updated 7/31/2007 11:03:33 AM ET 2007-07-31T15:03:33

Guests: Rep. Duncan Hunter, Rep. Joe Sestak, Michael O‘Hanlon, Brian Katulis, Jonathan Capehart, Joan Walsh, Matt Continetti

MIKE BARNICLE, GUEST HOST:  Gone fishin‘.  The Iraq parliament adjourns for a month.  Congress gets set to pack up and leave Washington this week and won‘t be back until after Labor Day, while the United States troops sweat it out, fighting the war in Iraq.

Let‘s play HARDBALL.

Good evening.  I‘m Mike Barnicle, in for Chris Matthews.  Today, President Bush and Britain‘s new prime minister, Gordon Brown, held their first press conference at Camp David, vowing continued cooperation on the war in Iraq.  More on this in a moment.

The 2008 race for the White House is heating up.  Hand-written letters that Hillary Clinton wrote to a friend when she was 19 show the private side of a very public woman.

And is the surge in Iraq working?  That‘s tonight‘s HARDBALL debate.

And a group of House Democrats are calling for impeachment proceedings against attorney general Alberto Gonzales.

But first, HARDBALL‘s David Shuster has this report.

(BEGIN VIDEOTAPE)

DAVID SHUSTER, HARDBALL CORRESPONDENT (voice-over):  It was their first official meeting since the new British prime minister took office, and despite enormous pressure in the UK on Gordon Brown to help the Iraq war, today at Camp David Brown gave President Bush the support administration officials were hoping for.

GORDON BROWN, PRIME MINISTER, GREAT BRITAIN:  Ladies and gentlemen, in Iraq we have duties to discharge and responsibilities to keep.

SHUSTER:  Brown said the British aim is to move control to Iraqis step by step.  And on troop levels, he echoed President Bush.

BROWN:  That decision will be made on the military advice of our commanders on the ground.

SHUSTER:  The United Kingdom has less than 6,000 troops in Iraq.  While that‘s just a fraction of the U.S. commitment, Great Britain is America‘s strongest ally and a complete withdrawal by the UK forces would be both humiliating for the Bush administration and would basically leave the U.S. all alone.  Today, in his own unique style, the president praised Brown.

GEORGE WALKER BUSH, PRESIDENT OF THE UNITED STATES:  He‘s a glass-half-full man, not a glass-half-empty guy, you know?

SHUSTER:  Then Mr. Bush laid out their goal.

BUSH:  And the challenge for Gordon and me is to write a chapter, the first chapter in this struggle that will lead to success.

SHUSTER:  In Iraq today, however, there was another setback.  The Iraqi parliament started a month-long recess without having enacted any laws related to stabilizing the country or reconciling warring factions.  The parliament will reconvene again in September, just before the top U.S.  general in Iraq, David Petraeus, gives Congress and Iraq progress report.

One of the major goals of the Bush administration‘s troop escalation had been to give Iraqi leaders breathing space to reach political accommodation.  There was one success, however, this weekend in Iraq.  The national soccer team, comprised of Shiites, Sunnis and Kurds who have been practicing in Jordan because Iraq is too dangerous, came together and won the Asian Cup.  It set off wild celebrations across Iraq but prompted another headache for the Bush administration because the player who scored the winning goal told reporters that U.S. troops should get of his country.

Against all of this, the Bush administration continues to get hammered over a high-profile domestic controversy, attorney general Alberto Gonzales.  President Bush today was not asked, nor did he say anything about charges that Gonzales lied to Congress, but this weekend, former Republican House Speaker Newt Gingrich sharply criticized the president‘s long-time friend.

NEWT GINGRICH ®, FORMER SPEAKER OF THE HOUSE:  Both the president and the country are better served if the attorney general is seen as a figure of probity and a figure of integrity and a figure of competence, and sadly, the current attorney general is not seen as any of those things.

BARNICLE:  And the ranking Republican on the Senate Judiciary Committee again called on Gonzales to resign.

SEN. ARLEN SPECTER (R-PA), JUDICIARY COMMITTEE:  The Department of Justice is second on the to the Department of Defense in protecting the American people—investigations on terrorism, on organized crime, on violent crime, on drugs.  And that department is dysfunctional and it‘s been dysfunctional for a long time.

SHUSTER (on camera):  This afternoon, a group of House Democrats said

they would introduce a resolution tomorrow calling on the House Judiciary

Committee had to begin impeachment proceedings against Gonzales.   It means

that the controversy over the attorney general is not about to go away,

even as the White House tries to put the spotlight on other issues, such as

the support President Bush is getting from the new British prime minister-

I‘m David Schuster for HARDBALL in Washington.

(END VIDEOTAPE)

BARNICLE:  Thanks, David.

California congressman Duncan Hunter is a Republican presidential candidate.  Congressman, before we get to ‘08 and the attorney general and assorted house cleaning items that film piece you just saw from Dave Shuster—the war in Iraq.  Prime Minister Brown was here, indicating support for President Bush in Iraq.  In the House of Representatives, it is assumed that Congressman John Murtha from the other side of the aisle is going to introduce an amendment at some point, perhaps this week, calling for redeployment of forces within 60 days, but no end date in sight for—for curtailment of forces in Iraq.

First of all, do you think he will introduce such legislation?  What do you think the prospects are for such legislation?

REP. DUNCAN HUNTER (R-CA), PRESIDENTIAL CANDIDATE:  Well—well, mike, you‘re going to have to ask the other side.  They don‘t confide in me.  And what the Democrat leadership has been doing is coming at this from a number of different angles—the readiness angle, the simple—simple withdrawal angle.  And so it‘s difficult to understand or to anticipate what new strategy they will use.

But I will say this.  In Anbar province, which was the most dangerous part of Iraq, where those tough towns of Fallujah and Ramadi were the scenes of incredibly intense fighting between the United States Marines and insurgents, al Qaeda is being crushed—that‘s the words of one of our senior Marine leaders—because the tribal communities in Anbar province have turned against al Qaeda.  I‘ve seen the classified briefings on the numbers of attacks on American troops there.  They‘ve dropped off the cliff, and we are doing very, very well there.

And the one thing that is definitely silent about the Democrat majority right now is—you sit in these meetings, in these hearings, they will not compliment the Marines for the great progress that they‘ve made in Anbar.  They will not give them a pat on their back.  I think they‘ve gotten to the point where they simply want to get this ball across the finish line, and that means getting some kind of a resolution through the House floor and through Senate that will continue to compress the president (ph) over the next three or four months.

But we actually have made a lot of progress in Baghdad, and I think even though the Iraqi parliament has left on this recess that they‘re taking, as we‘re leaving on our recess, I think the key is standing up the 129 Iraqi battalions that comprises the Iraqi army, getting them battle-hardened and getting them into the position where they can rotate into the battlefield and displace American heavy combat forces.

BARNICLE:  Well, Congressman, why do you figure—I mean, the reality is that there‘s a couple of members of the Senate from your party, the other side of the hill, Senator Lugar, Senator Domenici, softening their position on the war in Iraq in terms of their partisan support of the president.  It‘s a little weaker now than it was four or five months ago.  You‘re about to take a recess in the House.  You are going to go around the country.  You‘re running for president.  Other members will go back to their districts.  No doubt many of them will hear nothing from people other than, When are we going to get out of Iraq?

What‘s your sense of what will happen to GOP support in the House for the president‘s policy in Iraq?

HUNTER:  You know, I think that the—I think the American people, particularly after this—the events that occurred in Great Britain, where fairly sophisticated members of the medical profession attempted to kill lots of innocent people—I think the American people have more endurance for this particular conflict than they have in years past.  And I think we‘ll come back—I think we‘ll get a good report out of General Petraeus, at least if it follows what‘s happened in Fallujah and Ramadi and other difficult parts of western Iraq.  He‘s going to give a good progress report on those areas.  We still have problem areas in the Baghdad area and the so-called Sunni triangle.

But I think that—you know, there‘s two—there‘s two levels here.  There‘s two paths.  One is the political path, and of course, politicians are making their adjustment to provide for their political longevity against the backdrop of this difficult and dangerous war.

But the other path is doing what‘s right.  And I think that the Iraqi government is going to hold, and I think that the army that they‘re standing up now is going to hold.  I think they‘re going to bump (ph) forward in an inept fashion, as most new governments do, but I think that this operation is working.

And you know something else?  We‘ve been—all of us, Republicans and Democrats, have been with this operation for the last four years, and I think that we should see it through.  I think we should accomplish this mission, finish this mission.  And I think, in the end, this is going to be a very important, strategic move for the United States, certainly the most important strategic initiative in this neighborhood of the world that‘s been taken in the last 50 years or will be taken in the next 50 years.  This is very important.  It‘s important that we get it right, and I think it‘s important that my colleagues don‘t base their Iraq policy on the latest poll.

BARNICLE:  Congressman, shifting gears, not over the next 50 years but over the next 50 days, attorney general Alberto Gonzales—what‘s your verdict on him, up or down?  Should he quit?  Should he get out?

SHUSTER:  You know, I haven‘t—I haven‘t been reading the transcripts, watching the hearings, so I—and I don‘t want to disserve him by just repeating the headlines and statements by senators.  So unless I was in those hearings and had a chance to really examine the record, I don‘t want to trash Attorney General Gonzales.

I would say that the Democrats have a major responsibility here under the so-called FISA legislation.  According to our intelligence people, we have a major gap in intelligence reporting because communicators, terrorist communicators who are outside the United States but who make a communication that goes through the United States, through our communication apparatus, are now—we are now barred from wiretapping those particular communications.  And that is depriving us of essential information for the security of this country.  I think that‘s more important than what happens to Mr. Gonzales.

BARNICLE:  Well, let‘s say you were elected president of the United States.  Do you think the attorney general of the United States of America ought to work for the president of United States, as Attorney General Gonzales seems to think, or for the United States of America?

SHUSTER:  Listen, every attorney general—I think of Janet Reno.  Every attorney general is somewhat like a secretary of defense or like a CNO (ph).  They‘re working for the president.  On the other hand, they‘re working for justice.  And I would say that you always have to have that two-dimensioned capability, and when you get the other side of the aisle --  that is, the Democratic side now, with the majority and the ability to call hearings and to hammer at your exposures (ph) and hammer at your weaknesses, you‘re inevitably going to have the type of a drop in the popularity that Alberto Gonzales has.

And I notice when you play Newt Gingrich‘s statements—Newt Gingrich didn‘t say that he had done a terrible job, he said the appearance was that he had done a terrible job and that‘s bad for the country.  And obviously, these—these—this summer session of bash Gonzales hearings that the Democrats have been holding has been having an effect.

BARNICLE:  Congressman Duncan Hunter, thanks very much.

SHUSTER:  Many thanks.

BARNICLE:  UP next, Democratic reaction from Congressman Joe Sestak, a former vice admiral in the United States Navy.  And tomorrow on “NBC NIGHTLY NEWS,” Brian Williams will have an exclusive interview with new British prime minister Gordon Brown.

You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

BARNICLE:  Welcome back to HARDBALL.  It‘s a big week for Congress before it starts its vacation that will last until after Labor Day.  Congressman Joe Sestak is a Democrat from Pennsylvania.  He‘s a former admiral in the United States Navy and sits on the Armed Services Committee.

Congressman, the surge continues.  General Petraeus will be back in the middle of September to address you people in Congress, and of course, the rest of us here in the country, about the possibilities of progress from the surge.  If the surge continues into ‘08, into January and February ‘08, when happens—what happens to the United States armed services?  What happens to the Army, the Marine Corps, in terms of redeployment, in terms of troop strength?  What happens?

REP. JOE SESTAK (D-PA), ARMED SERVICES COMMITTEE:  We have a serious problem if this surge continues.  Every military officer I‘ve spoken to says that if we do not begin a redeployment of this surge force, at least, before next spring, our Army—which already here at home has not one unit, not one, active guard or reserve that‘s in a condition of readiness to respond anywhere in this world, if, for instance, our 30,000 troops in South Korea were to be attacked by North Korea, we aren‘t in a state of readiness to deploy.

That‘s why I say—it‘s not that I‘m anti-war, why I want a date certain to redeploy from Iraq.  I‘m pro-security.  And Democrats must now turn from opposition on the war in Iraq and turn towards authoring an implementable, comprehensive Middle East/Persian Gulf security plan because the aftermath of this war is so great for the consequences of America.  We‘ve got to stop saying it‘s Bush‘s war.  It‘s America‘s war.  And the elements to do it there, Mike, are present today.

BARNICLE:  Well, let me ask you about Afghanistan.  I mean, you served in that region.  You were in the United States Navy.  I mean, you were a flag officer.  Afghanistan—according to every report you read and everything you hear in this city from people who know a lot more about it than I do—that has now become an even stronger position for the Taliban.  What can the United States military do in Afghanistan that‘s not being done now that might be done were it not for deployments in Iraq?

SESTAK:  Three things.  First, when this war in Iraq began, we diverted all our attention and some of our resources away from Afghanistan to this tragic misadventure in Iraq.  I know.  I was on the ground in Afghanistan.  About two months after that war began, for a short two months, came back with my carrier battle group and then went back on the ground.

We took our special forces.  Our special forces actually worked with the citizens of that country, our psychological operations force, our civil affairs (INAUDIBLE) Iraq.  We need to redeploy those forces, about 3000-plus our generals have been asking for over a year, back into Afghanistan.

Second, when we heard from the national intelligence communities last week, they admitted in public that there is a safe haven right now in Pakistan.  That is where our inattention has permitted these al Qaeda—the center of the al Qaeda network to go.  We need to do a lot more.

We have the might of America.  We can see almost everywhere, and we need to be working better with Musharraf, the president of that country, in order to make sure that there is no safe haven for terrorists anywhere.  We‘ve diverted our attention to Iraq, and this is now a country where it‘s slipping back, prey (ph) to terrorists and to the control of the Taliban.  That‘s where the center of gravity is.

BARNICLE:  You know, your congressional district, where you come from in Pennsylvania, it‘s not exactly, you know, filled with a lot of people walking around wearing Birkenstocks or sandals and waving white hankies, you know, saying, Peace now.  What‘s the reaction that you get from people when you go home, when they understand and realize, as many of them do, that we are in a country, Iraq, where the legislature is about to go away for one month, having done very little, and the air-conditioning and electricity and running water in Baghdad is still not up to standards?

SESTAK:  They are concerned.  But I‘ll say this.  The Americans are tired of this war.  It‘s what I hear throughout my district.  But at the same time, they want to salvage the best of the situation, and they need Congress now to try to do it by turning towards a comprehensive way to do it, a strategic approach.  That‘s what I hear from them.

And the elements are there.  You mentioned them.  First off, what you have is an Army that must begin to redeploy by next spring if we are to salvage an Army that can be ready over the decades to come, years to come.  Second, that redeployment can‘t be tomorrow.  I tell everyone that.   You remember Somalia, Mike, after Black Hawk down, 6,300 troops to get out of that country took six months, and we inserted 19,000 service members in order to protect them because when you redeploy, withdraw, is when you‘re most vulnerable militarily.

Remember, the Soviet Union leaving Afghanistan, 120,000 in nine months it took them, and 500 people died on the way.  We have 160,000 troops there in Iraq and over 50,000 to 100,000 contractors.  What we have to do is remember we can only take a two to two-and-a-half brigades at a time.  And there‘s 40 brigade equivalents riding into Kuwait to wash them down, to shrink-wrap the helicopters, to put the tanks and clean them up and get them on the ships.  That is going to take 15 to 18 months. 

So, we have time here to do the third thing.  The road out of Iraq is through Tehran, Iran.  We need them.  We need to bring the last arsenal—last arsenal that we have not used, which is diplomacy, into this fight.  We need to deal with Iran. 

When I was in Iraq with Senator Hagel, Republican from Nebraska, we heard everywhere about the influence of Iran.  Let‘s change their behavior by changing their incentive.  They don‘t want an unstable country once we leave, the intelligence agencies told the House Armed Services Committee.

BARNICLE:  OK.

SESTAK:  Date certain permits us to redeploy and then work with them for stability in that country, so we can pay attention to Afghanistan, to Pakistan, and where the centers of gravity really are. 

BARNICLE:  Congressman Joe Sestak, thanks very much. 

Up next:  It‘s everything the White House wanted, a united Iraq.  Only, in this case, Iraqis have come together to support their national soccer team.  That story is ahead.

And don‘t forget the HARDBALL ad challenge.  Make your campaign ad. 

Send it in.  We will play it on the air. 

Here‘s an ad from Stephen Cody of Coral Gables, Florida.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE:  Massachusetts liberals, Michael Dukakis, Ted Kennedy, John Kerry, Governor Romney. 

MITT ROMNEY ®, PRESIDENTIAL CANDIDATE:  I believe that abortion should be safe and legal in this country.  Look, I was an independent during the time of Reagan-Bush.  I‘m not trying to return to Reagan-Bush.  I feel that all people should be allowed to participate in the Boy Scouts, regardless of their sexual orientation. 

UNIDENTIFIED MALE:  John McCain does not flip-flop.  You know where he stands on the issue. 

John McCain, right for Iowa, right for America. 

(END VIDEO CLIP)

BARNICLE:  Keep those ads coming, boys and girls.  Just upload them at our Web site, HARDBALL.MSNBC.com. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

BARNICLE:   This weekend, Iraqis of all ethnic backgrounds came together to celebrate the Iraq national soccer team, improbable winners of a major Asian tournament. 

No one expects the unity to last.

But, as NBC‘s Jane Arraf reports from Baghdad, for a few hours, there was only one Iraq. 

(BEGIN VIDEOTAPE)

JANE ARRAF, NBC CORRESPONDENT (voice-over):  A car bomb in central Baghdad today at a crowded bus stop has killed at least six people and wounded 30.

But the major attacks feared in yesterday‘s celebrations, after Iraq‘s stunning soccer win, did not develop.  In that one, Iraq beat Saudi Arabia 1-0, Iraq being the underdog, Saudi Arabia the three-time Asian Cup champion. 

That win sent tens of thousands of Iraqis out in the streets to celebrate, riding through the streets, waving flags, firing guns in the air.  Celebrations last week were marred by two suicide car bombs that killed more than 50 people.  Yesterday, though, there was only celebration.  Several people were killed by falling bullets as they came down, but no major attacks. 

Meanwhile, a major aid organization, Oxfam, along with a group of other aid organizations, says that up to 30 percent, 28 percent, of Iraqi children are malnourished. 

KASARAM MUFARAH, NGO COORDINATION COMMITTEE:  If right now, after the release of this report, there is already more funds for the humanitarian assistance to the most vulnerable of Iraqis, it will be a great outcome.  

ARRAF (on camera):  It calls it a crisis and it says that a large percentage of the Iraqi population, in fact, a larger percentage than before the war started, desperately need food, clean water, and health care. 

Jane Arraf, NBC News, Baghdad. 

(END VIDEOTAPE)

BARNICLE:  Coming up:  Aside from the soccer field, is Iraq making progress?  A Bush administration critic says yes, and he will be here for the HARDBALL debate. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MARGARET BRENNAN, CNBC CORRESPONDENT:  I am Margaret Brennan with your CNBC “Market Wrap.”

Stocks rebounded today after Wall Street‘s worst week in almost five years.  The Dow Jones industrial average gained almost 93 points in today‘s session.  The broad-market S&P 500 gained almost 15.  Tech stocks added about 21 points to the Nasdaq. 

After the closing bell, Sun Microsystems reported it swung to a quarterly profit from a year earlier loss.  In after-hours trading, Sun Microsystems shares are up almost 10 percent. 

Shares of “Wall Street Journal” publisher Dow Jones & Company were down more than 5 percent today, as the takeover bid by Rupert Murdoch‘s News Corp. appears to be in jeopardy.  “The Journal” report that News Corp.  is—quote—“highly likely” to proceed with its $5 billion offer if the offer does not get more support from the controlling Bancroft family.  We are standing by for news on that meeting now.

And an FDA scientist recommended that GlaxoSmithKline‘s widely used diabetes drug Avandia should be pulled from the market because of heart risks. 

That‘s it from CNBC, America‘s business channel—now back to

HARDBALL. 

BARNICLE:  Welcome back to HARDBALL. 

So, how is the war in Iraq really going?  There is a big question. 

The Bush administration reported earlier this month that the security issue continues to be extremely challenging, the economic situation is uneven, and the Iraqi government is slow in progressing toward a democratic society. 

But Michael O‘Hanlon of the Brookings Institution, who just returned from Iraq, says things are looking up.  In an opinion piece in today‘s “New York Times,” he suggests the surge is working and there‘s enough good happening in the country to warrant sustaining U.S. efforts into 2008.

On the other hand, Brian Katulis of the Center For American Progress says O‘Hanlon‘s assessment is wrong, and, worse, it‘s nothing more than propaganda to boost the war. 

Both gentlemen are with us tonight for the HARDBALL debate:  Is the war in Iraq working?

Michael, eight days in Iraq.  You went around the country, several different places, Tal Afar, Ramadi.  And things are looking better to you?  You are more optimistic than you were, say, six months ago?  Is that a fair assessment? 

MICHAEL O‘HANLON, SENIOR FELLOW IN FOREIGN POLICY STUDIES, BROOKINGS

INSTITUTION:  Yes, that is a fair assessment, although the political environment in Baghdad is still bad.  And, in the end, if that does not improve, there is no way we can find any kind of meaningful stability out of this effort. 

So, this is a very interim result that Ken Pollack and I wrote about today, in terms of military progress on the battlefield, but it is still rather striking.  And I would, frankly, reject the claim that it is propaganda.  We went and we tried to observe what was happening.  We were very clear about the things that are not working well. 

This is honest assessment and reporting.  It doesn‘t mean we‘re headed for victory in Iraq, but it is a very clear sense that we had in Iraq last week that the military aspect of this is finally beginning to show some results. 

BARNICLE:  Brian, tough word, propaganda. 

BRIAN KATULIS, SENIOR FELLOW, CENTER FOR AMERICAN PROGRESS:  Well, I think it is very much a propaganda piece.

Michael and Ken cherry-pick their facts.  They only talk about certain parts of the country.  And they ignore the fundamental premise of the surge, which was to get the politics working, to get Iraq‘s leaders to strike those political bargains. 

And what had happened—what happened today?  The Iraqi parliament decided they are going to go on summer vacation.  There is very little progress. 

And what is more, I am concerned that some of the forces that U.S.  military is aligned with right now actually are against our strategic interests in the region.  We are actually boosting the power of some of the very militias that are aligned with Iran, some of the very forces that actually don‘t like Israel, that don‘t like Jordan and some of our allies in the region, and we are suffering from strategic confusion.

And this is a big part of the problem which these interim assessments.  We have heard it before from Michael and Ken and a few other analysts.  And they have been wrong before.  And I am afraid that they are wrong again. 

BARNICLE:  Michael, eight days in Iraq, and you come back, and you say you are more optimistic than you were six months ago, and, yet, today, again, as is every day, six killed, 30 wounded in a bus explosion in Baghdad.  And you just said that, you know, without Baghdad being cohesive politically, nothing will work in Iraq, and, yet, nothing seems to be working in Baghdad.  So, how can you be optimistic? 

O‘HANLON:  I‘m not optimistic.  I said the military part of this strategy is working well enough to warrant a few more months of effort.

And I really wish Brian would stick to the assessment.  I think he‘s -

he‘s going to a little bit of a lower level than he usually does, in attacking the credibility of the people trying to make this argument.

I was one of the people saying five years ago, if you are going to go in and do this, you have got to do it seriously with a lot of force and a serious game plan.  I have been a critic of the administration all along.  I have been wrong sometimes.  I have been right a fair number of times.  I would rather just debate this on the merits.

We are not cherry-picking the facts.  We talk about a number of places where there are good things going on.  But we also say the sectarian problem has not, by any means, been resolved.  And what we are talking about is a situation where there is some progress on the military front that I think permits us to try, for a few more months, to have some effort at political reconciliation. 

That is an inconvenient fact for someone who has already decided that the mission has failed, but it is the reality on the ground. 

BARNICLE:  Brian, let me ask you, don‘t think there is some level of success in some areas of Iraq? 

KATULIS:  I agree that there are some degrees of stability that has been increased—increased stability in some parts of Iraq.

But that is on the shoulders and that is with forces, Sunni forces, Shiite forces, that we should not trust and trust very closely.  Plus, on top of that, a lot of these measures that the military is doing has been criticized by the Iraqi government.  In fact, we have had reports that Prime Minister Maliki wants to throw General Petraeus out of the country because some of these programs to arm the tribal elements that Michael and a few others support are actually going against the grain of building a cohesive Iraqi national government.

And, on the part of cherry-picking, frankly, their piece ignores the whole southern part of Iraq, which is the Shiite part of Iraq, the majority of Iraq, where we don‘t have much of a presence.  The Brits have actually decreased their presence.  And it‘s a mess.  And it‘s a big part of the problem, where we are looking myopically at certain parts of the situation, no looking at the whole, and seeing that the basic violence has not dropped considerably overall in the country, and the political process is stuck.

And I think we have got to call it like is.  And the more that we actually wish and dream and hope that Iraq might be a certain way, rather than calling it like it is, the further we get away from a solution.

BARNICLE:  So, Michael, tell Brian about Ramadi.  And, to my understanding, Ramadi is not a case of Shiites and Sunnis getting together and citizens getting together to throw al Qaeda in Iraq out.  It‘s a case of the United States Marine Corps doing extremely well with local leaders; is it not? 

O‘HANLON:  It is, although I don‘t—I, frankly, don‘t like the way Brian is making his argument.  And I am not just going to be the—the counterpart on the right to his extreme view on the left. 

I will come back at you and say, in Baghdad, things are still a mess.  And, here, Brian and I may agree.  But what I am trying to say is, there are models that are starting to work.  In Nineveh Province in the north, in Al Anbar Province in the west, in certain sectors around the city of Baghdad, and in a couple of neighborhoods of Baghdad, I think there is enough promise there to warrant a continuation of the effort for a few more months. 

I totally respect the point of view of someone who comes to the opposite conclusion.  But let‘s please acknowledge where each other have serious data and serious arguments, instead of stooping to this level of personal attack and calling people tools for propaganda.  It is really not doing justice to the severity of the stakes we face here as a nation. 

KATULIS:  I—I completely agree.

And the simple fact is, in many of the areas where you are citing progress, it rests upon the fact that we are actually working with sectarian police forces.  There has been sectarian cleansing in Mosul, in the province that you‘re talking about.  And a lot of the things that we‘re defining as progress, you‘re defining in your piece as progress, actually are the sorts of things that we are trying to guard against, in terms of sectarian cleansing, actually are the sorts of things that we trying to guard against is maintaining a unified Iraqi state. 

When we are actually developing security assistance programs that are aimed at undermining the Iraqi central government, it raises a big question about, what—what are we actually doing with the strategy and are we switching the basic terms of President Bush‘s surge strategy overall? 

BARNICLE:  Brian Katulis, Michael O‘Hanlon...

(CROSSTALK)

BARNICLE:  Go ahead, quickly, Michael. 

O‘HANLON:  It is a gamble, but what is the better policy?  There is no better policy if you still are trying to salvage something.  I think Brian has...

(CROSSTALK)

O‘HANLON:  ... and it‘s fair...

KATULIS:  The better policy is the one—the better policy is the one you advocated in 2004, where you said, set a date, and let‘s get out, and intensify our diplomatic efforts. 

BARNICLE:  Got to go.

KATULIS:  That‘s the better policy.

(CROSSTALK)

O‘HANLON:  The war was different then.

BARNICLE:  Up next: the HARDBALL panel on Hillary‘s teen angst, Giuliani‘s better half, and John McCain‘s version of 2.0.

This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

BARNICLE:  Welcome back to HARDBALL.  Time now to dig into today‘s hottest headlines with our political panel, “Salon.com‘s” Joan Walsh, the “Washington Post‘s” Jonathan Capehart and the “Weekly Standard‘s” Matt Continetti.

First up, letters from a teenage Hillary.  Hillary Clinton‘s detractors might peg her for a cold political machine, but newly released letters that Hillary wrote to a friend in the 1960s tell a different story.  The hand written letters depict an introspective, sometimes self-loathing, sometimes tortured emotional teen.  In one not to a friend she writes, “Sunday was lethargic from the beginning, as I wallowed in the morass of general and specific dislike and pity for most people, but me especially.”

In another, she asks, “Can you be a misanthrope and still love or enjoy some individuals?  How about a compassionate misanthrope?”  Is this a new dimension to the Hillary we have all come to know?  Joan Walsh, did you read the letters in the Times? 

JOAN WALSH, SALON.COM:  I did read the letters, Mike.  I think you put your finger on something.  I think they are a new dimension.  I think they are intensely humanizing.  You know, Hillary is somebody who has been depicted as this over achiever, kind of cold, certainly a super star.  She came to public attention, you know, really as a college student with that famous Wellesley address. 

She went to Yale law school.  She worked for the Watergate panel.  She married the man who turned into the governor and then the president.  There has not been a lot of hardship, except for in her marriage, I suppose.  She is like a person who was born with a silver spoon, politically.  She was middle-class. 

So I think the letters showed her as a person who really struggled and who is actually much harder on herself than other people.  There are no secrets.  There is nothing degrading.  There is nothing that you might want to hide.  So I thought they were a net gain, positive. 

BARNICLE:  The thing that surprised me about the letters, Matt, was that, A, she wrote them so consistently to this one guy over a period of a year or a couple of years.  I would not want anyone seeing anything I wrote when I was 16. 

MATT CONTINETTI, “THE WEEKLY STANDARD”:  That is precisely the point, Mike.  Hillary is used to having the press invade her private life, sometimes because of her husband‘s own actions.  But you wonder why people are sometimes discouraged to enter public service.  It‘s because they do not want the “New York Times” publishing letters they wrote as a talented 16-year-old on its front page.  This level of invasive journalism is really kind of—makes me roll my eyes. 

BARNICLE:  You read the letters, -- I sort of agree with that, actually.  I sort of agree with you, Matt. 

JONATHAN CAPEHART, “THE WASHINGTON POST”:  What about the guy who collected the letters and then kept them and handed them over? 

BARNICLE:  I want to know where he lives.   

CAPEHART:  But, you know what?  The interesting thing about these letters is that she is—Senator Clinton was not unlike other teenagers back then or even now.  As I was reading the Times story and the letters, I wondered if Hillary Clinton—if there is a Hillary Clinton out there today, this conversation would be done by IM or text messaging, and there would be lots of LOLs all over the place. 

So I have to agree that this does humanize her and makes Hillary Clinton to be just like any other introspective, thoughtful teenager. 

BARNICLE:  Joan, you know, when I saw this story and I began reading the story, part of me said, you know, do I really want to read this?  Because the invasion of privacy thing is one thing, but, you know, what, if anything, did this tell you about Hillary Clinton, these letters?  Other than the fact that she was, you know, a very well educated 17 or 18 year old young woman at Wellesley. 

WALSH:  I think they showed her to be a more sincere person than a lot of her detractors depict her as, Mike.  I think you saw the struggle from a Goldwater girl to a liberal Democrat, even beyond liberal for a time, I would say.  I think you saw that it was authentic.  I think it really made her seem like somebody who grappled with real internal issues, even sometimes demons, although, you know, when we are teenagers, everything seems like a demon. 

So I think we did gain something in our understanding.  And I do not begrudge the Times.

BARNICLE:  I tell you, I felt badly for her reading the letters.  I wanted to say, lighten up.  Have some fun.  You are in college.  What is this.  My god, the end of the world is coming.  You hate your father.  Stop it; go out and get drunk on the weekend. 

WALSH:  I have a teenager, so I wanted to read them and remember.  You know, we all have days like that.  But mostly it‘s a time you should be having more fun, actually. 

BARNICLE:  We are sticking with the Hillary theme right now, because we‘ve got Video 2008.  Time now to look at the hottest piece of political video on the air waves and on the Internet.  Here is Senator Hillary Clinton being heckled at a college Democrats convention over the weekend.  Take a peak.

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON (D), NEW YORK:  Let‘s fund 50 billion dollars to do this renewable, clean alternative energy.  And then let us make sure that we put it to work—

(CROSS TALK)

CLINTON:  That‘s all right.  That‘s all right—you know—

(CROSS TALK)

(END VIDEO CLIP)

BARNICLE:  I think what the sign said was, she does not care; all she wants is the power.  Basically, who cares about the video?  I don‘t know about people going online to take a piece at something like.  What, if anything, does that say to us about Hillary Clinton‘s tendency to attract people from both sides, polarizing influences? 

CAPEHART:  She probably stood there and said, that is the best they can do?  I mean, the Republicans threw lots at her and her husband for eight years.  So someone standing there with a sign saying all you care about is power, what is the big deal? 

CONTINETTI:  I thought she handled it well.  Obviously, any candidate is going to be heckled, sometimes more severe than that.  You can be a speaker on the college circuit and get pies thrown at your face for advocating certain opinions now.  This seemed pretty light and she handled it pretty well.  She is going to have a lot more as she approaches becoming president of the United States. 

BARNICLE:  Joan, she has become pretty good—much more adept at handling situations like that than she was a six months or one year ago.

WALSH:  She really has, Mike.  There are a couple of clips of her handling a Code Pink demonstration and heckling, where she really lost her cool.  I think she has learned that this is part of the terrain.  And I think she‘s definitely—in that scene, it really is only one person and the crowd handles the person.  So she can afford to be magnanimous.  It didn‘t seem like—

It was not about Iraq.  It was not a deep, wounding kind of thing.  She has definitely learned to roll with things and, in some ways, take herself less seriously. 

BARNICLE:  The sign holder was invited to that rally for her incredible lack of imagination.  We‘ll be right back with the panel to talk about John McCain and Rudy Giuliani.  You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

BARNICLE:  We‘re back with “Salon‘s” Joan Walsh, Jonathan Capehart of the “Washington Post” and Matt Continetti of the “Weekly Standard.”  Next up, new and improved McCain.  John McCain‘s campaign has suffered from week fund raising, staff defections and general disinterest.  Now he is plotting his comeback. 

“Newsweek” reports that at a New Hampshire McCain rally last week Journey‘s “Don‘t Stop Believing” was blaring and a homemade sign in the crowd read “The Mac is Back.”  McCain‘s supporters say his campaign troubles are not much different than Ronald Reagan‘s in 1980 when he had to overcome money trouble and internal fighting.  Bottom line, does McCain have a prayer?  The song, the Journey song, of course, was the song used at the end of the “Sopranos.”  Yes, was Tony clipped?  Is John McCain gone?

CONTINETTI:  I think John McCain still has a chance to become the Republican nominee for president, Mike.  It rests on one thing and that is if Michael O‘Hanlon and Ken Pollack, the Brookings Institution‘s authors of this op-ed in the “New York Times” piece, saying that there are some signs of military progress on the ground in Iraq—if they‘re right—if the surge ends up producing some results, then John McCain, the man who was the biggest backer of Bush on this Iraq policy, has a chance of becoming nominee.  Otherwise, it looks very difficult for him. 

BARNICLE:  Well, he is running against two calendars then; the political calendar and the Iraq calendar.  Joan Walsh, out there on the left coast, John McCain, you know, seismic campaign troubles, as reported back here in the east.  Has it had any impact on who people think McCain is in California? 

WALSH:  You know, I wouldn‘t say so.  I think he certainly has a chance when you‘re number one candidate on GOP side is none of the above.  John McCain has a fighting chance.  But it is going to be very tough for him to kind of re-bottle the magic from 2000, when he was the Straight Talk guy, who was very appealing to California independents. 

You know, we elected a governor who, in some ways, is cut from the McCain mold.  But then McCain squandered a lot of his political assets by glomming onto Bush in 2004, by hiring some Bush people, by sucking up to Jerry Falwell and Pat Robertson, which didn‘t even work.  The evangelicals still don‘t like him.  And yes, the war is costing him independent support in California and elsewhere. 

BARNICLE:  John, I‘ve got to tell you something; New Hampshire, I think, is just cranky enough that they could come back to McCain. 

CAPEHART:  But what does that mean?  He wins New Hampshire and then what. 

WALSH:  He did that already. 

CAPEHART:  And then he disappears again.  I think you hit it right on the head.  At least, for me as a member of the press, when John McCain did his speech—when he called Pat Robertson and Jerry Falwell agents of intolerance, I thought now there is straight talk.  That is someone standing on his own two feet. 

But then, when he walked away from that a couple of years ago or recently, I thought wait a minute; what happened to straight talk. 

CONTINETTI:  Jonathan may be disappointed.  But the press doesn‘t decide the Republican nominee for president.  Republicans do. 

CAPEHART:  But it does talk about character.  How can someone go from agents of intolerance to suddenly being hey, OK -- 

(CROSS TALK) 

CONTINETTI:  McCain‘s maverick problem is his support for Bush on immigration.  That‘s what is costing him Republican votes.  Giuliani, who has the same substantive policy, understood politically that he needed to be an enforcement first politician.  That gained him votes.  McCain, for sticking to his guns, lost votes.

BARNICLE:  We have a clip—a film clip here, taped—Bill Clinton earlier today on the spat between his wife Hillary and Senator Barack Obama over whether to talk to dictators.  Listen to the former president. 

(BEGIN VIDEO CLIP)

WILLIAM JEFFERSON CLINTON, FORMER PRESIDENT OF THE UNITED STATES:  I

don‘t want to get in the middle of that little spat Hillary and Senator Obama had.  But there‘s more than one way to practice diplomacy.  You can make up your own mind about that.  The point that I want to make is that they and all other Democrats had a vigorous agreement on the big question, which is should we have more diplomacy.  The answer is yes.  Then you can parse their answers to the specific questions to decide who you think is right.

(END VIDEO CLIP)

BARNICLE:  Jonathan, how many Democrats do you think are out there watching that and saying, why can‘t he run again?

CAPEHART:  Probably a lot of Democrats are asking that question.  But you know what?  I think Democrats probably, by and large, are happy compared to Republicans, which is the land of broken toys.  The Democratic field is an impressive field.  so as much as people—Democrats would like for Bill Clinton to jump back in the race and be president again, I think the choices they have to make are good ones. 

BARNICLE:  Land of broken toys, the Republicans.

CONTINETTI:  Here‘s another demonstration of Bill Clinton‘s political genius.  By inserting himself into this debate, he is letting this story go for another news cycle.  This is a story, I believe, every time it‘s in the news, Hillary Clinton wins. 

BARNICLE:  How is Hillary Clinton doing in California, Joan?

WALSH:  I think she‘s doing very well.  I actually started sing some house signs in San Francisco.  So, --

BARNICLE:  Well there‘s a surprise.

WALSH:  It‘s early.  I haven‘t seen any.  I haven‘t seen any others. 

But yes, I think she will do well here.  But I was blown away by that clip.  I didn‘t know how he would do it.  He still wants to be the leader of the party, whoever the nominee will be.  So he found a way to stay on both their good sides.  It surprised even me how masterful it was. 

BARNICLE:  It‘s amazing how he can dominate the stage and the spotlight and continue, as you said, through several news cycles.  Jonathan Capehart, Joan Walsh, Matt Continetti, thanks very much.  Join us again tomorrow night at 5:00, 7:00 Eastern for more HARDBALL.  We‘ll be joined by Congressman Jay Inslee, who wants to impeach Attorney General Gonzales.  Right now it‘s time for the incredible Tucker Carlson.

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

END   

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