updated 12/20/2006 3:15:53 PM ET 2006-12-20T20:15:53

Guests: Charles Gasparino, Chuck Todd, A.B. Stoddard, Tony Blankley, Joel Stein, Roxanne Roberts

TUCKER CARLSON, MSNBC HOST:  Welcome to the Tuesday edition of the show.  We‘ve got a lot to coverage today.  But we will start with news from the corporate world.

Federal regulators are trying to recoup $91 million in salary earned by former Clinton budget director Franklin Raines during the six years he ran the Federal National Mortgage Association, more commonly known as Fannie Mae.  Raines and at least one other Fannie Mae executive are accused of inflating the company‘s earnings in order to justify their bonuses. 

If it‘s true it‘s a scandal, but what is unquestionably true and possibly even more scandalous is the fact that Franklin Raines made $91 million in the first place working for a quasi-government organization.  Raines didn‘t invent Fannie Mae.  He didn‘t found the federally guaranteed mortgage concept.  So what did he do to deserve $91 million?  No one seems to know.  No one seems to care.  It is just assumed that executives who run huge organizations deserve huge compensation packages. 

But that should not be assumed.  $91 million for six years or corporate caretaking isn‘t fair; it‘s greedy.  And ultimately, it‘s destabilizing for any society that allows it.  There aren‘t any revolutions brewing in this country, but keep up that sort of nonsense and there soon will be.  That‘s prediction.  We‘ll get to all that and more in a minute.

First now, the war in Iraq, and a reported rift between President Bush and the Joint Chiefs of Staff.  Joining us now to talk about that, A.B.  Stoddard, associated editor of “The Hill” newspaper; Chuck Todd, editor-in-chief of the “HOTLINE”; and Tony Blankley, editorial page editor of the “Washington Times”.

Welcome to you all. 

Tony, the “Washington Post” reports today that there is a rift of sorts between the Joint Chiefs of Staff and the president.  The president wants as part of his new Iraq strategy to put a sizable number of troops temporarily in Iraq to get the situation in Baghdad under control.  And the Joint Chiefs say that‘s a bad idea.  Is this true?  Is this really happening?  And, if so, what does it mean?

TONY BLANKLEY, “THE WASHINGTON TIMES”:  Well, as Tony Snow, the press secretary, said it was—the article was tonally inaccurate. 

CARLSON:  Right.

BLANKLEY:  As a former press secretary, I understand sentiment.  You can a lot of facts cited in a news story that aren‘t wrong, but it points the readers in the false direction.  Now I don‘t know because, unlike the authors of that article, I was not in the room when the president was talking with Joint Chiefs of Staff.

My hunch is that there‘s a lot of consternation going on as to how to carry out what is, I think, the president‘s intent is to try to use more troops...

CARLSON:  (INAUDIBLE)

BLANKLEY:  ...  and the military justifiably saying, OK, if that‘s the objective, how do we do it?  And so there‘s going to be a lot of back and forthing on understanding what are the resources that are going to be necessary, is the president asking for enough, is he asking for too much. 

Now, individuals who want to—there are plenty of kibbutzes in the Pentagon.  And if there are people are telling reporters, you know, I hear that so and so is rejecting it, I find it hard to believe that there‘s a general there on active service who is saying, I won‘t do the order.  I assume that there‘s a legitimate debate about how to carry out a policy. 

CARLSON:  But it does—if this is true or if even strains of it are true, parts of it are true, Chuck, it puts the president in a difficult situation.  As he has said from the beginning, I listen to the uniformed chiefs—I mean, I listen to the people who run the military and I most of the time do what they suggest I do. 

If this is true, he‘s kind of bound, isn‘t he?

CHUCK TODD, HOTLINE:  Well, I was reading the article at face value. 

And the one thing that came out at me is like, maybe this is the Joint Chiefs trying to get control of the Pentagon back.  You know, Donald Rumsfeld ran roughshod over them, at least in the minds, if you believe the Woodward... 

(CROSSTALK)

TODD:  ... Yes, exactly.  If you believe all these books that came out before Rumsfeld resigned.  And so I was struck that maybe this is just the Joint Chiefs saying, look, we‘re going to will draw a line here, OK?  We may end giving at some point.  But it was sort of a warning shot to the White House, hey, Rumsfeld‘s gone, we want a new type of order in how we negotiate.

CARLSON:  Assuming, A.B., that “Post” isn‘t just making the quotes—

I think we have to assume that they‘re not—something from the Joint Chiefs, or in that orbit anyway, is leaking to the “Washington Post”.  That‘s something you don‘t see very often.  That‘s a sign.

A.B. STODDARD, “THE HILL”:  Look, we have on the record General Abizaid saying the military is stretched to capacity, Schoomaker as well.  Off the record or on background, military sources are telling the “Washington Post” that because we‘re out of alternatives, the White House is leaning on something that is not a viable option, one the Joint Chiefs oppose. 

Now, the big factor here is that Robert Gates has not weighed in.  And when he does, he has said that he is open to more troops.  That will be a huge factor in what President Bush decides to do. 

But I think it‘s very significant that they would come out.  It‘s doesn‘t matter who‘s in charge, who‘s secretary of defense.  The fact that they would inform the reporter and provide a context for the reporter to write an article saying President Bush is doing something that the Joint Chiefs oppose because he‘s out of options, and it will only provide a temporary reprieve and will lead to further damage is really, big, bad news. 

CARLSON:  It does seem like people—everyone is sort of running away from the Iraq policy.  Where are the people, Tony, who are going to stand up say, I‘ve got a great idea, here‘s what it is?

BLANKLEY:  Well, General—former General Keane last week at American Enterprise Institute laid out a proposal.  He was the Vice Chief of the Army until very recently and, by the way, one of Rumsfeld‘s favorite generals.  So he proposed more troops and not just in a surge, but for a sustained period of time. 

But let me make a point that you don‘t want to jump to false conclusions.  One of the requirements, probably, of the president‘s proposal, if it is his proposal to increase strength, is we‘re going to have to—we allow more troops in the Army National Guard and the Army Reserve to be called up for more than once every five years. 

Now, until that is agreed to by the president, then it would be legitimate for the generals to say, if you don‘t change that rule, we can‘t do this with the forces we‘ve got.  So there‘s going to be a lot of going back and forth.

Now, one other piece that I think you can‘t over-appreciate is that the military and each unit in the military is so focused on protecting their own force, be it Army, Navy, or Air Force, particularly with the Army and Marines, that sometimes I have a feeling that they don‘t quite see the strategic American concern and are more focused on—understandably—protecting their resources from being degraded. 

And I think that‘s a challenge the president has now, which is to say, look, I understand these problems.  And we have a national strategic crisis.  We‘ve got to figure out how to handle it. 

CARLSON:  Well, we‘re all parochial in a way.  I agree with that.   

You heard, Chuck, the First Lady Mrs. Bush earlier, I think late last week, say, you know, the media are inflating the gravity of the situation in Iraq.  I want to point out something out I thought was really, really interesting.  It has to do with Ollie North, the former Marine colonel and an impressive guy, in my view, in most ways. 

This is an interesting, however.  Last week on sixth of December, a Marine major called Megan McKlung (ph) -- she‘s a public affairs officer in Iraq—was killed.  She was killed by an IED getting out of a vehicle, I believe in Ramadi.  She has just finished immediately before taking around Ollie North and his Fox crew around Iraq. 

This is Ollie North the following day, December 7, the day after the woman who was escorting him was killed by IED.  Quote, this is what he said on Fox, “The battalion commander from this unit, the First Battalion, Sixth Marines, the Army brigade commander, all working together to make a better city ought to be great news.  Somehow it just doesn‘t get transmitted through the airwaves to the folks or the masters in the media.”

Now, it seems to me—and I hate to beat up on Ollie North because I think he‘s more impressive than most people in the media by a lot—however, there is, I believe, an equal and opposite force on the other side of this spinning things in an unjustifiably positive way.  And that doesn‘t get the attention that it should. 

TODD:  Well, and at this point, though, that the White House is trying to talk this way, I mean, it‘s interesting that they‘re having Laura Bush now do the media bashing when it comes to coverage of Iraq because she‘s about the only person left in the White House with any credibility with the American public on any issue, maybe, at this point. 

But particularly, maybe on this issue, I just think they ought careful.  I think at this point, they‘ve lost the media battle when it comes to deciding whether things are going well in Iraq or even whether going to Iraq was the right decision or not.  Now it‘s sort of—they have to figure out how at least to gain some credibility that whatever policy they come up with is at least a step in the right track. 

CARLSON:  And the media, because they are in the end dumber than they

are left-wing and lazier than they are ideological—I really believe that

in the beginning, supported the Iraq war.  I mean, they was—they‘re followers.  They‘ll go along with whatever that, you know, most Americans believe it seems to me.

STODDARD:  But it‘s just no longer—I mean, Chuck is right, they‘ve lost the media battle.  But they‘ve lost the hearts and minds of the American people.  And this election told us so.  And that‘s—as Chuck says, President Bush is in a corner and he must come would up with a new policy, a way forward that shows people that he‘s listening and that shows people that it‘s—he has a means to his end.  And he hasn‘t. 

And what‘s is interesting about, actually, the interview that you cite, is that there is a serviceman that Oliver North is talking to, and he‘s talking about being at a school—and in individual cases, I think that the servicemen that are there believe that they are winning the hearts and minds of the Iraqis in individual cases.  But in a macro sense, that‘s been decided.

CARLSON:  Very quickly, Tony, do you think this is fair criticism for Mrs. Bush, that this is actually much more positive in Iraq than we know? 

BLANKLEY:  Look, I mean, the media is almost always not completely accurate on almost every topic.  There‘s no doubt that in the early years of this war that the media was not getting out in the countryside and reporting some of the good news that was then occurring. 

However, it is now unambiguously the case—I‘ve talk with enough people who are pro-war, who have been there to agree that the general perception that things are going very badly is accurate.  And to say that that‘s no longer correct reporting --- whatever the media did badly in the past, I don‘t think is valid. 

CARLSON:  I agree with you.

Coming up, it is the season for corporate executives to give themselves obscene cash bonuses.  What could CEOs possibly be doing to merit tens of millions more than they already make?  If there‘s an answer, we will find it.

Speaking of, Donald Trump should get a bonus for the Miss USA scandal alone.  We‘ve got clips and comments of the greatest news conference ever held in this country.

Stay tuned for that.

(COMMERCIAL BREAK)

CARLSON;  Not feeling the annual Christmas spirit, you say?  Then you are certainly not a top executive of a giant company.  Because if you were, you would be rubbing your hands together right now and getting ready to cash a bonus check that would make Ivan Boesky blush—not that that‘s possible. 

Is it an outrage or an essential part of the world‘s largest economy, these bonuses?  Here to explain, one of the best business reporters in the business, Charlie Gasparino of CNBC.  Charlie thanks a lot for coming on.

CHARLES GASPARINO:  Thanks for having me.

CARLSON:  So we found today that Franklin Raines, late of Fannie Mae is being investigated in a civil way anyway for re-jiggering the numbers over there in order to inflate his bonus, but the bottom line is over six years, he makes $91 million.  That seems unjustifiable.  Is it justifiable? 

GASPARINO:  Well, listen, if it wasn‘t a fraud.  We should differentiate Fannie Mae from a regular company.  Fannie Mae was essentially a quasi-governmental company.  I think that much money given to someone who works essentially for the government, is obscene, absurd, maybe even fraudulent on top of that.

There‘s a case of possible accounting fraud there.  That‘s a lot different than what is going on at Goldman Sachs.  I‘m sure you‘ve read all the headlines.  We broke a bunch of major stories at CNBC about some of the people getting a lot of money over at Goldman Sachs.  They are getting paid a lot of money because they make lot of money for the shareholders.  They make a lot of money for New York City taxpayers.  You know, they are a big company, located in New York City.  A lot of their investment bankers live there.  And that—the money they make—the $25 million, the $50 million dollars they make—gets filtered back into the New York City. 

CARLSON:  Yes, but wait a second.  I mean, look, I don‘t want to be Upton Sinclair here.  I‘m hardly a lefty—I‘m pro-market, I‘m as conservative as anybody else ...

(CROSSTALK)

CARLSON:  Preface this by saying, that I‘m not you know, an envious person espousing class war.  However, when you see Bill Gates, you know, the richest man in the world, you flip on your computer and there‘s Windows -- hey Bill Gates made that—I get it.  Someone whose making $40 million for a single year‘s bonus at Goldman Sachs—what exactly is he creating, what is he adding to the sum of America that he earns $40 million bucks.  I just don‘t get it.

GASPARINO:  I think there‘s a little more gray area than the black and white you‘re displaying here.  Listen. you‘re right, I mean, there is—you shake your head and wonder how people who essentially transact securities trades, they make money by bidding up a certain stock or trading when the stock is down and figuring out how the market is going to work.

There is a sort of essential absurdity that people making that much money just from doing that.  However the business of Wall Street, whether it‘s doing that, that sort of minute by minute stock trading, or whether it‘s finding investment banking deals for investing in undervalued companies, that helps create the next Microsoft. 

Microsoft started somewhere.  Someone took a chance on it.  And that chance was taken on Wall Street.  They were able to flow an initial public offering. hey were able to list on the NASDAQ.  They made a lot of people rich because of the system of Wall Street which, yes, does give people a lot of money, maybe more money than they deserve when you think about how much a schoolteacher is making, but that essential business of Wall Street helps the economy run and is the reason why we have a good economy right now. 

And Tucker one more thing—there‘s a reason why liberal Democratic people who run major cities like Alan Hevesi, controller of New York State who may be indicted tomorrow, we don‘t know, but the controller of New York City, Bill Thompson, why they love bonuses from Wall Street, is because the money that all these guys make gets filtered back into the New York economy and it helps poor people. 

CARLSON:  Right.  It helps poor people.  It helps ensure their re-election.  They are as greedy as anybody on Wall Street or even more so.

GASPARINO:  Yes, but you can‘t deny—Wall Street doesn‘t put this money in a mattress.  It reinvests it.  Listen, I go to San Pietro restaurant.  I met you at San Pietro restaurant ...

CARLSON:  Yes, that‘s true—great restaurant.

GASPARINO:  Guess what, guess what  -- all the working class waiters there, immigrants from Italy and Albania and Portugal—they love Wall Street bonuses this season because they make more money. 

CARLSON:  Very quickly—Democratic Congress in power or will be as of January.  I am not espousing any kind of legislative remedy to this, what i think is a problem of corporate pay.  But they might.  Are people on Wall Street worried that the government is going to somehow try and curtail their bonuses? 

GASPARINO:  Not yet. I mean, you will see this maybe at the beginning on next year.  You have to realize that a lot of these sort of liberals on Wall Street, the Barney Franks of the world, the Pat Leahys, these guys—the Chuck Schumers.  They do love Wall Street.  They‘ve been getting campaign contributions from Wall Street for many years. 

I doubt Chuck Schumer is going to propose some sort of a tax on the rich Wall Street guys given all the campaign contributions he received. 

CARLSON;  What ever happened to the left because Clinton killed the populist left.  Thanks a lot.  Charlie Gasparino, I appreciate it.

GASPARINO:  No problem.

CARLSON:  Coming up John McCain is getting ready to run for president.  Can he get elected as one of the only Iraq hawks left in public life?  Good question?

Plus, any plans Miss America Tara Conner might have had to run for president were probably dashed at her historic press conference today.  But there is good news—she was not run out of her current office and even better, we‘ve got the tape.  the amazing details coming up.

(COMMERCIAL BREAK)

CARLSON:  Is corporate compensation out of control?  CNBC‘s Charlie Gasparino  made a good case that it‘s not, but you don‘t have to be a socialist to suspect that yes, maybe there is a problem here.  Here now with their views, three of America‘s hundred-million-dollar bonus winners, A.B. Stoddard of the “Hill,” Chuck Todd, editor-in-chief of the “Hotline” and Tony Blankley, editorial page editor of the “Washington Times.”

Tony, I‘m not saying that Congress ought to step in and limit what people make or decide what people make, obviously, that‘s a disaster as has been proven.  However, societies in which there is a dramatic disparity in wealth, where there is a small group of very rich people and a very large group of not as rich people.  If the disparity is big, even if the poor people are not poor by international standards, it causes unrest in the country.  I mean, we know that.

BLANKLEY:  Yes.  Despite the fact that there‘s been some stickiness in the wage gaps in the last 10-15 years, America is the perfect example of a country where you don‘t have a small, wealthy group and vast, suffering masses.  We have the largest middle class proportion of any population in the world.  So I don‘t we‘re in a pre-revolutionary state because movie stars and big executives make a lot of money.  The resentment in America has always been by the poor and not against the rich.  That‘s the secret of our success.

CARLSON:  No, that is actually a good point.  And here‘s the difference, though.  With the corporate executives—with some corporate executive, one gets a feeling, Chuck, and I agree pretty much with what Tony said, but he‘s saying that it‘s almost fixed.  I‘m the CEO, you‘re the board, I‘ll race your compensation, you raise mine.  That‘s not a system, that‘s not a meritocratic system.  That‘s an inside job.

TODD:  Well the thing is, one thing that we learned in this election that anybody who voted on the economy as a major issue voted Democrat because they were upset.  So they didn‘t like—even though we were told by the numbers, the economy is good, everything is going great.  But the fact is, particularly in the Midwest, where populism, the sort of bash corporate America stuff really played well, in Missouri and Indiana and some of these states, where we saw dramatic Democratic victories.  It showed you that this is a message that‘s resonating. 

Now Democrats always have to be careful when they overplay it because at the end of the day, the average lower/middle class guy thinks they‘re just one Powerball jackpot away or one crazy invention away from also becoming super rich.  So we‘re still an aspirational society, but this wage gap—look, John Edwards is banking his entire presidential campaign that this wage gap thing that we‘re talking about is real and is a message that‘s worthy.

CARLSON:  Well Edwards didn‘t—I think because he is the anti-Clinton.  I mean, Clinton spent eight years sucking up to corporate power like no one ever had.  And he changed the Democratic Party in the process.  They weren‘t the anti-corporate party, as they had been throughout the ‘70s in my view, and the ‘80s.  Is it changing again?  I mean, is John Edwards the future?  Is Clinton the past?

STODDARD:  I think the Democrats are coming to town and you‘re going to hear a lot of talk about this middle class squeeze, and wages are not keeping up with inflation and people can‘t afford basic things like health care and energy. 

And we‘re going to hear a lot about this.  But they‘re not going to cut bonuses.  They‘re going to look, obviously at shifting the tax burden at some point.  But they‘re going to play both sides.  Just like he said before about Chuck Schumer liking Wall Street.  I mean, they‘re going to play it—they‘re going to play it straight and they‘re going to be practical politicians because they are looking to hold power in the next few cycles and they‘re not going to make Wall Street mad.

And as far as the real gap, we have two—I mean, there‘s nothing that can be done about this.  This revolution you speak of is not nascent, it‘s not going to happen.  People have a choice.  They can‘t either boycott these bonuses, boycott the corporations.  These people who are getting all this money at the end of the year are driving huge profits.  And you can either get mad or you can think about something else or you can try to get a job there.

CARLSON:  Well about moral sense?  Tony, why was the 1980s or the decade of green and Gordon Gekko and all that, and that was all very bad.  We‘re supposed to feel guilty about it, but now, corporate—and through the ‘90s to now, corporate bonuses as a percentage have been getting higher, I believe every year.  Why nobody—this isn‘t the decade of greed, why?

BLANKLEY:  It‘s not the decade of green because when a Democrat is a president, then it‘s not a decade of greed.  When a Republican is a president, it‘s a decade of greed.  But more importantly, the people who should complain, if there‘s a complaint there, were the corporate shareholders.

CARLSON:  I agree with you.  Why aren‘t they? 

BLANKLEY:  Well I assume that the institutional shareholders, the big guys who have hundreds of millions of dollars of shares, the pension funds are judging that they they don‘t feel cheated by the compensation. 

Keep in mind, even from Fannie Mae, people say, well it‘s a quasi-government organization, which maybe it is.  But the fact is, he‘s not a GS-18.  He is managing the real estate market of the country, for goodness sakes.  If Fannie Mae makes a hash of things, we have a real estate panic in this country.

So you want somebody—his responsibilities are as big as the president of General Motors or anybody else. 

CARLSON:  Or the president of France, for that matter.

BLANKLEY:  If he committed fraud, that‘s another matter.  But the fact that he was doing a job managing all those assets and all of the leverage those assets have on American real estate, I don‘t think that there‘s any reason to say he‘s not entitled to more than a GS-18‘s compensation, because it happens to be somehow affiliated with the government.

CARLSON:  I don‘t know—I wish I had more time.  Unfortunately, we‘re coming up.  I have a more thoughtful answer, but we‘re out of time.

Coming up, when will Rudy Giuliani throw his hat in the ‘08 presidential ring?  Pretty soon would be my guess.  But can a Republican with so many Democratic views win in his own party?  The eternal question, we‘ll ask it once more.

And speaking of parties, break out the caramel corn and the diet soda.  Gather around the TV, ladies and gentlemen.  You‘re moments away from today‘s Miss USA press conference recap.  Ignore all incoming calls and stay tuned, it‘s worth it.  We‘ll be right back.

(COMMERCIAL BREAK)

(NEWS BREAK)

CARLSON:  We have breaking news on Miss U.S.A. and her saga in just a moment, but right now for a recap of all that‘s happening in domestic politics, we are rejoined by A.B. Stoddard, associate editor of the “Hill,” by Chuck Todd, editor and chief of the “Hotline,” and by Tony Blankley, editorial page editor of the “Washington Times.”  Tony, Can John McCain, who is really the last hawk standing in public life, of prominence anyway, can he run as a supporter of a war that is painfully unpopular? 

BLANKLEY:  Well, I don‘t know, but there are two possible ways how he could.  One, he is clearly proving his convictions, because the expedient thing to do is break from the president, and there‘s a value in the American electorate in honest politicians, or people who are perceived to be that way.  Reagan, often—I worked for Reagan for years.  Reagan often, one of the things in our polling was I may not always agree with him, at least I know where he stands. 

CARLSON:  Right, same with Bush.  I think he‘s benefited from that.

BLANKLEY:  And so that‘s an asset.  The other possible upside is that perhaps things will turn around, in which case, he will seem to be right, but if the war goes worse, I agree, I think he has positioned himself—I don‘t think he‘s positioning himself.  He‘ll find himself in a very difficult position. 

CARLSON:  You think it‘s authentic. 

BLANKLEY:  No, I‘m not a fan of McCain, but I think this is an authentic position on his part. 

CARLSON:  Chuck, you had a really interesting column this week about the Senate and how the Democrats could hold on to it.  Will you recap?  I mean—

TODD:  Well, the numbers are really working against the Republicans over the next six years. 

CARLSON:  For retaking the Senate?

TODD:  For retaking the Senate, because the 2008 cycle and 2010 cycle are reelections of the very successful Republican cycles, that were 2002 and 2004.  Meanwhile, this one cycle now, for the Democrats that just came through, 2006, it‘s now got half the Democrats that have been elected are from this same class, 2006.  So, just by the numbers, Republicans have to defend more seats in 2008.  Never mind that they also are going to have retirement, which always come with power switch overs.  But also serious retirements like New Mexico, a swing state, Virginia, possibly, a swing state, even a North Carolina, though some tell me that Elizabeth Dole is definitely running.  Don‘t think about that, which is a moderately competitive state.  No Democrats going anywhere under these circumstances. 

CARLSON:  What about—I mean, historically, when a party takes a chamber, or the whole Congress, that party holds on to it for a while. 

TODD:  For a long while.  I mean, in the Senate we‘ve seen, sort of, on a six to eight years, that it goes.  Usually when one party gets it, they usually hold on to it.  When they win it in an election, not the way the Democrats won it in 2001, but when they win it in an election, it usually takes a good six years to flip it. 

CARLSON:  Yes, six, adds on six and before you know it, it‘s a generation.  A.B., what do you think, Rudy Giuliani?  You keep hearing people—you know, all of the smart kids are saying, well, gee, you know, he‘s too liberal for primary voters in South Carolina, specifically, But New Hampshire too.  But then he‘s at the top of all these polls.  What do you make of that?  Why are conservatives supporting a guy who‘s just a full blow liberal?  

STODDARD:  Well, there‘s a question about which conservatives are supporting Giuliani.  Among the activists, who are concerned primarily with social issues, I don‘t know that they are really rooting for him.  And there‘s a discussion going on, and I‘ll be interested to see how long the Republican party has to have this debate, about whether or not they really want to win and they need to pick a winner.  If you talk to Republicans who are for Giuliani, they like star power.  They want a winner.  They want him to be Hillary Clinton. 

And this debate will be taking place about whether or not they are going to abandon their focus on the issues that drive the Republican nominating process, and just be a more moderate party that wants to win, or whether or not they are going to eject him from the process and that debate will decide.  If the people who are practical minded and want a winner, win out over the social conservatives who run the primary process, he can make it, but if not, he can‘t. 

CARLSON:  Tony, if you have a Republican party whose presidential candidate is pro-choice, pro-illegal immigration, pro-gun control, for, you know, raising taxes, I mean, in what sense do you have a Republican party?  What‘s the point?  Why would I vote for that guy over the Democratic, I guess? 

BLANKLEY:  Well, I mean, that‘s why most of the smart Republican

political operatives think that Giuliani will melt once the primary

electorate start seeing those positions.  I think there‘s half of a

plausible case to be made for the fact that if he is the strongest

candidate, and if terrorism is the primary issue, and if he played it right

and said I‘m going to pick a very conservative vice president.  I‘m going

to make a commitment to honor the Republican platform.  What I‘m running

for is to protect the country and manage the government, perhaps under some

circumstances he can make the sale.  He is a genuine hero.  He‘s not simply

a fabricated candidate.  But I have to say that --  I mean, it‘s hard to

look at what I‘ve seen over the years, of the Republican primary voters,

and see his set of issues and wonder how he gets to the other end

CARLSON:  Very quickly, Chuck, because we have to get to Miss U.S. A.  as quickly as we can.  I she raising money and is he going to have trouble raising enough money? 

TODD:  He‘s raising money tonight and we‘re going to find out.  I mean, I think he clearly is going to raise that first chunk of money pretty easily.  This is New York folks.  They love him.  He‘s a start and he will do that.  It will be interesting.  So I think the first 20 comes fairly easy to him.  What will be interesting is that next 20, and with all these guys, with John McCain as well, that next 20 is the harder 20.  It‘s the one where you are really trying to get the activist who believes in you.  By the way, I mean, Rudy is the competency candidate.  If somehow Katrina and Iraq can be merged into one issue, you can see a plausible case where Rudy says, hey, I‘m the Republican that will clean up this mess.   

CARLSON:  Yes, who actually knows how to do these things.  OK, well we have been teasing for last 35 minutes, because we are diabolical TV people, the really remarkable press conference given by Tara Conner, Miss USA, today.  So, without further ado, here‘s some clips.  Watch this. 

(BEGIN VIDEO CLIP) 

DONALD TRUMP, “THE APPRENTICE”:  Tara is a good person.  Tara has tried hard.  Tara is going to be given a second chance.  I believe, after speaking with Tara, I believe that she can do a tremendous service to young people.  She‘s agreed to go into rehab. 

TARA CONNER, MISS USA:  Walking into this tower this morning in no way did I think that it would be possible for a second chance to be given to me.  I‘ve had a very big blessing bestowed upon me, and you will never know how much I appreciate Mr. Trump for saving me on this one.

(END VIDEO CLIP)

CARLSON:  We here at NBC know what compelling television looks like, and that, ladies and gentlemen, was compelling television, and what a deal, rehab for the Miss USA title.  That crown and sash must mean a lot to her. 

Joining me now is someone else who knows the value of a crown and sash, former Miss U.S.A. judge and current writer for the “Los Angeles Times,” Joel Stein.  Joel welcome.  Mr. Trump promises that Tara can do a, quote, tremendous service for young people.  What do you think that service would be?

JOEL STEIN, “THE LOS ANGELES TIMES”:  Where was he?  He was speaking like he was Lou Gherig in Yankee Stadium.  Who speaks like that?  It seemed like the most important thing anyone has ever said in their life.  Well, obviously she has to go to rehab, right.  She‘s under 20 and drinking.  In today‘s culture, there‘s no great crime.  Yes, I don‘t know what decade Trump is living in, or if he‘s ever looked at his own life, or if she just wouldn‘t sleep with him.  I don‘t know what‘s going on. 

CARLSON:  To be fair, there was cocaine and a hint of bisexuality. 

STEIN:  Yes, she‘s 20.  You don‘t know what 20 year olds do now. 

CARLSON:  Along with the naval piercing and tattoo on their lower back.  Of course, no, that‘s a very good point.  Is this real?  I mean, this does seems like a—

STEIN:  A hint of bisexuality?  She kissed another girl.  What happened? 

CARLSON:  Something or something similarly appealing.  Something like that.  Yes, I think she kissed Miss Teen U.S. A., my producer is telling me.  My producer, who gets “US Weekly,” is telling me in my ear. 

STEIN:  Wow. 

CARLSON: Yes, that was my response.  What are the chances, do you think Joel, that this is all part of an elaborate publicity stunt cooked up by Mr. Trump and Tara?

STEIN:  He‘s good.  I don‘t know if he‘s this good.  This is kind of brilliant.  I mean, obviously he saw an opportunity, at the very least.  There was some footage of Miss USA doing Coke, or kissing another Miss US something, and he figured he could make a big deal of this and send her to rehab, which is great for the children.  It teaches us all a lesson.  You know, I was a judge for the Miss USA pageant, and their morality was something we looked at very, very strongly in making a decision. 

CARLSON:  I mean, I know that the Miss America pageant pretends to be a scholarship program, or something to that effect, but this is basically softcore porn, isn‘t it?  Or is there something more?

STEIN:  Yes, it was pretty soft and it was kind of boring, but it was a little porny, at the same time. 

CARLSON:  What are the criteria used to crown Miss U.S.A.?  Well, I think, what they look like in a bikini, what they look like in a moniki (ph), what they look like in a string bikini.  I can‘t remember all the categories, but there were a lot of them. 

CARLSON:  She said, Tara said, I don‘t know if you got a chance to see her whole press conference.  I‘ve got it on DVD and I‘m willing to send it to you later, if you don‘t.  But she said, as I stepped into the shower today, I thought deeply about the situation.  She is basically just titillating us, isn‘t she? 

STEIN:  You can‘t get upset with someone in the age of blogging.  I actually MySpaced her three days ago, asking if she would go with me to an event at the New York Public Library and something at the Council on Foreign Relations, to kind of improve her image.  I have not—honestly, I thought that would make a fun column, I haven‘t heard back from her yet.  But, I think it may have tipped.  It may be too late for me.

CARLSON:  When you were out there, Joel, when you were judging—

STEIN:  Her MySpace page is phenomenal.  I recommend it.

CARLSON:  What else is on it? 

STEIN:  There‘s some pictures of her, which are similar to the ones we‘ve all seen now.  I found out what kind of music she likes.  This is a lot of information.  I can‘t go into right now. 

CARLSON:  That sound you hear in the background is thousands of our viewers signing on to their computers to get to her MySpace page.  Joel Stein, thanks so much. 

STEIN:  Thank you.

CARLSON:  Coming up, Old Reliable is at it again, Marion Barry in hot water with the fuzz, the heat, the coppers, the national park service.  Oh, if only we were kidding.  We‘re not kidding.  Stay tuned for details.  We‘ve got them.  And if it‘s Tuesday, there must be gossip coming straight out of Washington, D.C., and indeed there is.  Today‘s star, Roxanne Roberts of the “Washington Post‘s” Reliable Source.  Don‘t miss it. 

(COMMERCIAL BREAK)

CARLSON:  It‘s that time again, time to turn from the deeply serious, Iraq, presidential politics, Miss USA pageants, to the equally important, mildly less serious, D.C. gossip.  For today‘s helping we are joined by Roxanne Roberts, the great Roxanne Roberts, who, of course, is the columnist behind the Reliable Source.  That‘s the “Washington Post”—

ROXANNE ROBERTS, “THE WASHINGTON POST”:  How are you.

CARLSON:  Roxanne, how are you? 

ROBERTS:  Hey, we got a tip today that a big time TV host went to go to see the new James Bond movie last night here in DC.  You‘ll never guess who it is. 

CARLSON:  Did he have a ten year old blonde boy with him. 

ROBERTS:  Yes.

CARLSON:  That would be me and my son, yes.  We did go see it yesterday.  You really got that tip, that‘s frightening actually.

ROBERTS:  We honestly got that tip.  It was a slow news day.  What can we say? 

CARLSON:  So there are people all over the city who call, creepy voyeur types, who call in about other people? 

ROBERTS:  Only if they‘re incredibly cute and famous.  So, someone is like—think about it this way, Tucker, you made somebody‘s day.  So, think of yourself as a walking public service. 

CARLSON:  Not just the popcorn vender.  What of note is going on in our fair city. 

ROBERTS:  Oh, my favorite—well there are two things.  My favorite today is that, now you do recall disgraced lobbyist Jack Abramoff, who was spotted in court wearing really big, ill fitting suits.  And his tailor was distressed because people thought they were his suits, and it turned out that the fabulous custom tailors that Jack had had made, those suits were in storage because he wouldn‘t pay for them.  And so they sat in storage for a while, until earlier this month, when a local journalist, who happened to have exactly the same dimensions of Jack, in his big days, offered to buy the suits.  He bought two of them and a blazer and he wore one of them to a White House press party last week. 

CARLSON:  That‘s unbelievable.  So you are wearing Jack Abramoff‘s discarded clothing?  Had Abramoff ever actually donned these suits?

ROBERTS:  No, Jack was too cheap.  See, he had these suits and he‘s a big guy, so he had these beautiful custom suits made for himself.  Then he lost weight and he lost so much you could not be altered.  So the tailor, very graciously, made him new, skinnier suits, on the condition that he would buy back the old suits.  Then Jack, of course, stressed out, eat too many, you know—I don‘t know, donuts, got fat, wanted the suits back, wouldn‘t pay for them.  The tailor said no.  So the suits were, sort of, held ransom in storage.  And so we wrote about it, and this journalist, the Washington correspondent for the “Rocky Mountain News,” read about it and said, these are exactly my dimensions.  So he was able to buy custom suits.  One of them has, on the lining, in gold, it says Jack Abramoff on it.   

CARLSON:  Wow, I wonder if the orange jump suit he‘s now wearing will be on sale when he‘s done. 

ROBERTS:  You know, there are people that would buy that.  There are people that would give that as a Christmas present if they had the option to do that.

CARLSON:  Honestly, I would do that.  So what else is going on?

ROBERTS:  Of course you would. Well, Prince Albert of Monaco was in town.  He snuck in town last month to look at a three million dollar house in a very tony section of Northwest called Kalorama, beautiful, gorgeous architecture.  Well, it turns out that Monaco is opening its first ever embassy here.  You know, before that they were, sort of, you know, the little brother to France, diplomatically.  Well now there is a new treaty signed, so they are allowed to have—so the ambassador, who is at the U.N. right now, is going to come down here, move in here.  You know, he has an American born wife.  They‘re going to have an embassy here. I am secretly hoping that they‘re going to have a disco and a casino in the basement, so I can go have, sort of, that Monaco feel. 

CARLSON:  So this means that Prince Albert is going to be on the loose in Washington, D.C., eating our food, impregnating our women, having the run of the town? 

ROBERTS:  Well, you know, he‘s a little older.  He‘s calmed down some.  So I‘m not sure about the—you know, I hope eating our food.  I hope, actually, I‘m eating his food.  I am hoping to be a guest at the embassy, where technically I would be, you know, in Monaco, under the largess of the, you know—Because they can afford it more than I can. 

CARLSON:  I don‘t think there‘s any question if Prince Albert has a party, you will be there.  I‘ve never been to a party that was any good that you weren‘t at.  Roxanne Roberts of the “Washington Post.”  Thanks Roxanne. 

ROBERTS:  Bye-bye.

CARLSON:  If it happens here, you know about it, amazing. 

BLANKLEY:  I actually have some commentary on that. 

CARLSON:  Tell me.

BLANKLEY:  Seeing the picture of the house, and it‘s on Kalorama, the French embassy residence is also an Kalorama, and it is immensely larger than that picture they showed of Monaco‘s house.  So, they‘re still the country cousin.

CARLSON:  I know, it‘s sad.  It‘s sad, because Monaco is a proud

little princedom, fiefdom, whatever, emirate, whatever,

TODD:  It will be an emirate in the future. 

BLANKLEY:  Does that mean Prince Albert in the can jokes? 

CARLSON:  But it is amazing in Washington—I mean, the old line about how politics is Hollywood for ugly people, and all that.  I mean, Washington is, everyone says this every year the White House correspondents dinner, but it never ceases to amaze me in its trueness, totally in love with famous, handsome people. 

STODDARD:  And we haven‘t really had many here in awhile.  It‘s gotten, sort of, quite undashing.  I‘ve lived here now since 1990, and think it‘s—I‘m sorry, this is no comment on Republican rule or anything, but it did get a little, sort of, less social and less—I don‘t know, wild.   

CARLSON:  Do you know why?  Because the people who have been elected president, since 1992, and I think Clinton falls in this category, and Bush definitely does, have contempt for Washington and its permanent culture.  They hate it.  They run against it.  They come here like oh, we‘ve got nothing to learn from you.  Then they set themselves on fire midway through the second term and then they realize why -- 

TODD:  We actually have a bunch of celebrity candidate.  If Rudy, Obama, McCain, they are going to be very much celebrity presidents, if one of them gets elected.  So I actually think it will bring the celebrity back to the White House if one of those three people gets elected.  Mitt Romney too, I mean, talk about a beautiful guy.  I mean, he‘s got the whole—you know, they will bring celebrity and good looks back to Washington, D.C..

CARLSON:  I actually feel stirrings when I look at him.  I‘ll be totally honest.  On that note, my final question, can Mitt Romney convince conservatives he is one of them, and not simply posing as one? 

BLANKLEY:  I don‘t know.  He is being hung up on the 1994 statement he made about gay rights.  My hunch is—He had done so well on the circuit in town, meeting with conservatives, over the last several months.  My hunch is that he is going to get by on that, although it is going to be a close count. 

CARLSON:  When you pledge to be more pro gay rights than Ted Kennedy, it is a hard sell that you are an evangelical, but I agree with you.  He seems to be doing well.  Tony Blankley, Chuck Todd, the great A.B.  Stoddard, thank you both (sic), all three.

Coming up, the world exhales as the Miss USA scandal reaches a peaceful resolution.  What exactly was Tara Conner doing in New York City that caused all that trouble?  We‘ll get to the bottom of it. We‘ve got details when we come right back. 

(COMMERCIAL BREAK)

CARLSON:  If you thought we fully exhausted the topic of Miss U.S.A., her drinking, her drug use, her recreational bisexuality, you were wrong.  Willie Geist is here with more.

WILLIE GEIST, MSNBC CORRESPONDENT:  Tucker, you read that list with such glee.  It‘s kind of sickening actually.  Before we get to that, I have a quick update on an important snowman stabbing story we first brought to you yesterday.  The two men seen in this video have now been apprehended.  They are two 18-year-olds, who were arrested in Ohio for stabbing to death this defenseless inflatable snowman.  And just to give you an idea of how seriously the sheriff‘s office is taking this, in the statement they said, quote, the investigation continues to snowball. 

CARLSON:  Not really?

GEIST:  They sure did, in a written statement.  So, those guys have been nabbed.  It‘s an important lesson to young people, do not stab inflatable snowman.  I couldn‘t agree more.

CARLSON:  I agree.

GEIST:  Moving on Tucker, as you discussed just moments ago, Tucker, Miss U.S.A. has been given a second chance.  Now we give ourselves a second chance to see this video, again, by talking about Tara Conner now.  Come on, who could stay mad at that face.  As you know, Donald Trump granted Conner a reprieve and ordered her into rehab.  The former Miss Kentucky has been reported to have been doing too much hard partying around New York City during her reign.  Trump, who co-owns the Miss Universe organization, along with most other things in the world, said today Conner just got caught up in the whirl wind of New York. 

Tucker, two points here.  Number one, Trump obviously, with this press conference, cemented his legacy as the greatest American of all time.  He just passed Lincoln and Teddy Roosevelt, just today.  And also, the other thing, I kind of reject the whole premise of this, that she is letting all these people down as a role model.  Do you know girls who look up to Miss USA?  Do they have, like, posters of Miss U.S.A.?  I don‘t understand.

CARLSON:  Of course they do, she‘s a role model.

GEIST:  To you maybe, but not to children. 

CARLSON:  Yes, to me.  Look Willie, all I know is the last time I criticized Donald Trump on our show, he left me a message bragging about how much sex he has.  He said something to the effect—and I can‘t use the actual phrase, because it‘s R rated—but he said look, you may have better hair than I do, but I get more women than you do.  So, I‘m never criticizing the guy again.

GEIST:  I never have and I never would.

CARLSON:  That‘s the spirit.

GEIST:  In other news Tucker, the list of people out to get Marion Barry continues to grow.  The former Washington mayor now says he‘s being targeted by no less than the National Park Service.  Barry says he was detained by U.S. Park Police for nearly three hours Saturday, after he was pulled over for driving his green Camaro too slowly.  Police say a computer glitch incorrectly showed his license as having been suspended.  Well Barry is not buying that.  He says, quote, I‘m being targeted by the National Park Service, Park Police, Secret Service and other federal agencies to try to stop me on any pretense they can.  Now Tucker, this is the unluckiest son of a gun I ever did meet.  He keeps getting set up by the feds.  Don‘t you think it‘s terrible what they‘re doing to him.

CARLSON:  I just wonder why.  What are they trying to stop Councilman Barry from trying to do, to speak the truth about what? 

GEIST:  It doesn‘t seem worth it.  I just love that he drives a green Camaro, that‘s all. 

CARLSON:  So great. 

GEIST:  Finally, the smooth segue form Marion Barry to this next story was unintentional, I swear.  A woman was arrested in Florida on Friday after she complained to a sheriff‘s deputy that the crack cocaine she just bought wasn‘t very good.  Fifty year old Eloise Reeves (ph) approached the officer at a convenience store and said a man had sold her bad crack, that had wax in it.  She pulled a crack rock from her mouth to show the deputy.  She was then arrested and obviously charged with possession of crack cocaine. 

Probably wrong to do that, but who do you, may I just ask, complain to when you get bad crack?  Do you call the Better Business Bureau?  It seems like the police should be the one group you could go to with something like this.

CARLSON: It does seem like that.  Although every time I have heard one of these stories, the person who does the reporting is not lauded as a good citizen. 

GEIST:  No, no, that‘s a good point.  This reminds me of the story of the guy who called the police station to claim the marijuana that was found somewhere.  Just think it through first. 

CARLSON:  Think it through.  Willie Geist.

GEIST:  All right Tucker.

CARLSON:  A man who has thought it through, thanks Willie.  That does it for us.  Thanks for watching.  We will be back here tomorrow at the same time.  Tune in then.  Have a great night.  

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

END   

Copy: Content and programming copyright 2006 NBC.  ALL RIGHTS  RESERVED. Transcription Copyright 2006 Voxant, Inc.  ALL RIGHTS  RESERVED. No license is granted to the user of this material other than for research. User may not reproduce or redistribute the material except for user‘s personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon NBC and Voxant, Inc.‘s copyright or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.

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