updated 9/10/2007 10:59:27 AM ET 2007-09-10T14:59:27

Guests: Jim Gilmore, Mark Green, Victor Garo, Joseph Salvati, Willie Brown, Heidi Harris, Jonathan Capehart, Craig Crawford

CHRIS MATTHEWS, HOST:  Who lost Osama?  Why did a man who attacked us, who an American president promised to get dead or alive, escape our grasp, escape even our attention except when he sends us some video sticking it to us?

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  Welcome to HARDBALL.  The big story tonight, Osama bin Laden, six years after he ordered the attack that killed thousands of Americans—he‘s still out there.  He likes to remind us each year that he‘s still out there with a little video.  But President Bush has gone from, We‘ll get him dead or alive, to being completely bogged down in Iraq.  Why isn‘t bin Laden a priority for Bush?  Why aren‘t any of the presidential candidates, including the Democrats, making bin Laden priority number one?  What happened to America‘s cry for justice?

The second story tonight: The FBI sends four men to prison for life, knowing they are innocent.  How could our government be so evil?  We‘ll talk to one of the men who served time, three decades for a crime the FBI knew he never committed.

In the political headlines, Michelle Obama tells us that her girls—

I can‘t believe this—say Barack Obama, their father, quote, “stinks.”  And our HARDBALL debate tonight: Who lost bin Laden?  We‘ll talk about that with former San Francisco mayor Willie Brown and radio talk show host Heidi Harris.

First, however, so what about bin Laden?  The new tape contains no overt threats, but bin Laden does criticize—catch this—the Democrats for not being able to stop the war in Iraq.  He says they have been bought off by U.S. corporations and their money.

Pentagon correspondent Jim Miklaszewski has more.  Mik, the significance, the message of this tape, please?

JIM MIKLASZEWSKI, NBC CORRESPONDENT:  Well, the significance, first of all, is that al Qaeda tries to release a tape around the anniversary of the 9/11 attacks six years ago.  The true significance of this tape is that it appears—it is proof that Osama bin Laden was alive, at least as late as last June.  That appears to be the benchmark that appears in this tape.  It is probably the better indication in what bin Laden had to say that he was alive at that time because he makes specific reference to the inauguration of the new French president in May and the installation of the new British prime minister, Gordon, in—Gordon Brown in June.  So U.S. intelligence officials say it appears that bin Laden was alive at that time.

I can tell you that they are still analyzing the tape to try to authenticate that this is, in fact, bin Laden, but U.S. intelligence officials tell us tonight that it is presumed that this is, indeed, Osama bin Laden on this tape.

MATTHEWS:  The highest water mark of this presidency, the finest hour for President George W. Bush, bar none, was when he stood at the rubble at the World Trade Center that Friday and said, We‘re going to get the people that knocked down these buildings.  How high a priority has been the catching of bin Laden, this man who‘s still on the loose?

MIKLASZEWSKI:  Well, it depends on who you talk to.  There are people, obviously, in the intelligence and special operations forces community who are focused on bin Laden entirely.  But then there are others who claim that the U.S., of course, missed its chance to get bin Laden during the war or immediately after the major conflict in Afghanistan, and were distracted, of course, by the war in Iraq, according to George Bush critics.

And it‘s interesting because throughout this tape, bin Laden uses the war in Iraq not only to taunt the U.S., but as you said earlier, the Democrats, claiming that the war continues because the entire political system, the Democrats, the White House, are held hostage by the political system that relies so heavily on money.  And at one point, he issues a taunt by saying, As you‘re the ones who have the saying which goes, Money talks.

MATTHEWS:  Well, I think that was Ozzy Meyers (ph) who went to prison for that comment.  Money talks, something walks.  Remember that phrase from the ABSCAM days.

MIKLASZEWSKI:  Absolutely.

MATTHEWS:  But I have to say, Mik...

MIKLASZEWSKI:  He didn‘t include the rest of that in that statement.

MATTHEWS:  I know he didn‘t, but I got to tell you something.  This guy is onto something.  He‘s tying together his Islamic zealotry with the old left‘s argument that wars and everything else bad are always caused by corporations.  And it‘s interesting that he‘s jumped—I don‘t think he‘s quite got the note here of the anti-war sentiment in our country.  The anti-war sentiment is, We want less casualties for Americans, we want less enemies in the world, we think this war was going in the wrong direction.  Blaming this on big corporations, I think, may be narrowing it down to a few ideologues.

MIKLASZEWSKI:  Right.  Right.  But you know, he does make the point that last elections, in which the Democrats were put back into power in both the House and Senate, were an indication that you, meaning the American people, want this war to end, but the Democrats haven‘t been able to deliver because, again, as he puts it, they are prisoners of the corporate money and that...

MATTHEWS:  Well, three quarters of that is definitional.  People did vote Democrat to end the war, and the war is still going on.  The motive is yet to be established.  Anyway, thank you very much, Jim Miklaszewski at the Pentagon.

MIKLASZEWSKI:  You bet, Chris.

MATTHEWS:  Well, it six years ago that President Bush, at the height of his popularity, as I said, went to ground zero three days after 9/11 and made this into an iconic moment in American history.

(BEGIN VIDEO CLIP)

GEORGE WALKER BUSH, PRESIDENT OF THE UNITED STATES:  I can hear you.  The rest of the world hears you.  And the people who—and the people who knocked these buildings down will hear all of us soon!

(END VIDEO CLIP)

MATTHEWS:  A magic moment.  I don‘t think anybody else could have pulled that off, including Al Gore, who got more votes than that guy, amazing moment to unify the country, unify the world against the evildoers who attacked us on 9/11.  And they were evil, and yet bin Laden‘s still out there.  We thought he was riding away on a burro with a dialysis unit hooked up to him.  And we thought a six-foot-five Arab in that part of the world would be easy to catch.  Why haven‘t we caught?  Why haven‘t we made enemy number one?  Why isn‘t he on the—why isn‘t his face on the Post Office everywhere in the world right now?

Mark Green is president of Air America Radio.  Jim Gilmore‘s the former governor of Virginia.  I want to start with Mark.  Why is this guy still on the loose?  Why is the enemy number one for America and for our president?

MARK GREEN, AIR AMERICA RADIO:  Because Mr. Dead or Alive, George W.  Bush, Mr. Bring It On, George W. Bush, misdirected billions and thousands of Americans into Iraq, rather than focusing on bin Laden, who was an admitted mass murder, and bin Laden has picked up on it.  After the Cole attack, bin Laden is so shrewd, according to Lawrence Wright in his defining “The Looming Tower,”  that bin Laden told his people, OK, now we hope to provoke the United States to attack us because it will help our al Qaeda movement.  And the U.S. didn‘t respond then because it was at the end of the Clinton and the start of the Bush presidency.

He understand what he‘s doing.  He knows how to play the American system.  In fact, John Kerry, right or wrong, thought that the bin Laden tape the Friday before the Tuesday election in November contributed to or cost him the election because bin Laden wanted Bush to win.  This is not fantastical because he benefits from Bush scaring his Muslim radical audience, and Bush benefits by al Qaeda scaring the American audience.  And so I don‘t know that either has much of an interest in—in...

MATTHEWS:  Yes.  You never know, though.  You never know, Mark.  In all fairness to you, and I think you‘re smart about this stuff, is that you never know about these bozos from other countries.  They sometimes nail it, they get it right.  The monkey types Merry Christmas, and sometimes the clock is right.  But sometimes they get it wrong.  He may have done this to maybe hurt Bush, to humiliate him.

Let‘s go to former governor Jim Gilmore.  Governor Gilmore, what do you make of this fact that we‘ve got this guy at large six years after the president declared, Dead or alive, we‘re going to catch him, and he seems to have been fading as a point of interest all these years?

JIM GILMORE ®, FORMER VIRGINIA GOVERNOR:  Well, I think we have accomplished a great deal.  The president went forward and destroyed the regime that was, in fact, giving this guy, this fellow, safe harbor.  OK, so he‘s elsewhere now, but he‘s in hiding.  He has to be a leader out of hiding.  The communication that he has to be giving to his followers is that, We are all in trouble, that we‘re in hiding.

We think we‘re going to get this guy, and we should get this guy.  But the bigger picture is what we have to focus on.  We can‘t just rely on things like defeatism out of Air America or the Democratic Party.  We have to really focus on the fact that this is going to be a major challenge that has historically been coming forward, and it‘s going to be incumbent on us and our allies and our friends, even in the Muslim world, to stand up for civilization.

Bin Laden just preaches hate and destruction and killing of innocent people.  That‘s not the way of the future.  And the American approach and the approach of allies and our friends across of the world, we‘re the wave of the future, not some...

MATTHEWS:  Well, why did we...

(CROSSTALK)

MATTHEWS:  Why did we shift attention when the war wasn‘t won in Afghanistan—and people said there weren‘t enough troops there because we had already—already indicated and assigned those troops to go to Iraq?  If we had kept enough troops in Afghanistan, wouldn‘t we have caught this guy at Tora Bora?

GILMORE:  Well, maybe, and maybe not.  Any time you‘re in battle and you‘re in a war, you just don‘t know what‘s going to happen.  And meanwhile, Iraq...

MATTHEWS:  Well, why didn‘t we keep our focus on the bad guy?  You know in politics or in life, you got to keep the focus, the main army on the main enemy.  Why didn‘t we keep it there?

GILMORE:  Well, because it‘s a bigger picture than just one country and one person or even just Osama bin Laden.  We have to address the fact that we have to be at battle with people who are Islamic fascists, people who want to kill innocent people and bring back a medieval type of philosophy.  We have to be prepared for that, and we will be decisive and do that.  I know this from the world that I‘ve done with the terrorism commission.

GREEN:  With all due respect to Governor Gilmore, who cited our problems in Iraq and attributed it to defeatism at Air America—if Air America existed or not, it was the president he voted for and supported, and sought to succeed, who invaded the wrong country, put us into the middle of a sectarian Muslim strife, that we can‘t stay or get out of.  So any defeat that occurs—remember, it was Rumsfeld who said it wouldn‘t last more than six months—is on his party and his head.  And so actually, to try to blame others is odd.

I agree with him we were right to go into the country that gave him sanctuary, which was Afghanistan.  And then the world understands and history will record that George W. Bush, this messianic neoconservative, either misled us or was misled or both into this Iraqi war, has taken now taken our eye off the ball.

One last thing.  The problem is that even if we catch bin Laden, A, think about the waves of suicide bombers that would inflict on us.  But B, because of our mistakes in Iraq, we have metastasized al Qaeda and extremism.  So there are now, instead of one al Qaeda planning a 9/11, or the next 9/11, God forbid, there are thousands of cells that bin Laden doesn‘t control.  So while it may be emotionally satisfying to catch him...

MATTHEWS:  OK, let me ask you...

(CROSSTALK)

MATTHEWS:  Let me ask you about Barack Obama, who says that we should go into Pakistan with any evidence we get, go after this guy, don‘t sit around waiting for Musharraf to approve the action.  Are you with him on that?

GILMORE:  Well, you know, I...

MATTHEWS:  Go in, whatever it takes and catch this guy, if we have the intelligence where he is.

GILMORE:  Well, in fact, I‘ve been to Pakistan and I‘ve been probably within 50 miles of exactly what that are is.  And we‘re going to have to work with the Pakistani government in order to make sure that we do bring this area to heel.  But we have to make it very clear to that government and to President Musharraf and to anybody working with him that we will stand not for a lawless area becoming a substitute for Afghanistan.  And they have to understand that there is a limit to American patience on this.

MATTHEWS:  Let‘s take a look at Obama.  This is Barack Obama talking about how he‘s going to track down, hunt down al Qaeda and bin Laden himself in Pakistan.

(BEGIN VIDEO CLIP)

Sen. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE:  If we have actionable intelligence about high-value terrorist targets, and President Musharraf will not act, we will.

(END VIDEO CLIP)

MATTHEWS:  What do you make, Mark, of the charge by Osama bin Laden today in that tape that‘s just coming out right now that the Democrats who ran and won control of Congress last November with the promise to end the war in Iraq have failed to do so because they‘re in the tank with big U.S.  corporations?  They take too much campaign money.  You laugh, but a lot of money goes into the pockets of both parties.  These big corporations hedge their bets, as you know.  Is that one reason why they‘ve been so, well, let‘s say less than zealous in ending this war?

GREEN:  Chris, the reason I laugh is if bin Laden says that Federer may win the Open, it doesn‘t mean he won‘t.  And I laugh because I‘ve written several books about big business political influence and a book about how money shouts.  And I didn‘t write the line in bin Laden‘s talk.  Look, you can blame big business in America for a lot of things, from the environment to our tax policy.  But what‘s going on in the Middle East is not driven by big business.

And of course, he‘s right that Democrats won in ‘06.  And from the Baker-Hamilton commission to Senator Warner and the GAO report, there‘s overwhelming empirical evidence we shouldn‘t be in Iraq and we should leave in an orderly way.  So but why haven‘t we?  U.S. Constitution, notwithstanding the War Powers Act, gives one guy—or two people, Bush-Cheney, the ability as commander-in-chief to stay there irrespective of evidence and popularity, not to mention to think about going after Iran.

MATTHEWS:  Yes, but your party has the power of the purse strings.  They have the majorities in both houses.  They could cut off the funding for this war, if they had the cojones to do it.  You know it.

GREEN:  That‘s correct.

MATTHEWS:  That‘s a fact, OK?

GREEN:  Well, that  is a fact.  And I think Pelosi and Reid‘s rhetoric is very tough...

MATTHEWS:  OK...

GREEN:  ... but they are flinching at voting to cut off funds because the Republicans are so brilliant at interpreting that as anti-troops instead of...

MATTHEWS:  OK...

GREEN:  ... being pro-troops to bring them home safely.

MATTHEWS:  OK, let‘s write that down.  Mark says Republicans are brilliant.  Let me ask you one last question, Governor Gilmore.  Forty-two percent of the American people say we‘re not going to catch bin Laden.  Are they right?

GILMORE:  No, we‘re going to catch bin Laden.  We‘re going to catch bin Laden.  And it‘s much bigger than bin Laden.  This is a battle that we‘re going to be facing for a long time.  His tape today is designed to create division in a free country with free speech just like we have here today.

And Mark is a very eloquent spokesman, to be sure, but the goal here is to create dissension within the United States as possible.  It‘s not just a matter of Iraq or no Iraq or Afghanistan.  We have to be resolute in going forward and recognizing that the future...

MATTHEWS:  OK...

GILMORE:  ... is about freedom and democracy, it‘s not about this fascist guy sitting in a cave someplace.

MATTHEWS:  Well, the president ought to catch this guy.  Anyway, thank you, Mark Green.  Thank you, Governor Jim Gilmore.

Coming up: The FBI put four men in prison for decades for a murder the know—the FBI knew they didn‘t commit.  Now it‘s $100 million penalty for the federal government because they did this.  Why did the FBI abuse its power?  Why did the federal government prove itself to be so—and I can‘t think of a better word for it—evil?

You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Now a horrendous Kafkaesque story that you cannot believe happened in our country.  The federal government has been ordered to pay over $100 million in damages for framing and putting four men in jail, in federal prison, for a 1965 murder they did not commit and the FBI knew they did not commit.  It was a cover-up that the attorney for one of the men says went all the way to the FBI director himself, J. Edgar Hoover.  Joseph Salvati served 30 years in prison before being paroled, and he‘s here with his attorney, Victor Garo, to tell us his personal horror story that robbed him of his youth, his family and much of his life.

Good evening, gentlemen.  I want to start with the attorney, Mr.

Victor Garo.  Tell the story of this horror, if you can.

VICTOR GARO, ATTORNEY FOR JOSEPH SALVATI:  What it has to do with is the FBI‘s fight against organized crime.  And as Judge Gertner (ph) said in her decision, these four men were collateral damage in the war against organized crime.  To the FBI, the plaintiffs‘ lives and those of their families just did not matter.  This case is about an intentional misconduct, subornation of perjury, conspiracy, and the framing of innocent men.

The FBI‘s conduct was intentional.  It was outrageous.  It caused the plaintiffs immeasurable and unbearable pain, and the FBI must be held accountable.  The entire FBI hierarchy was implicated in supporting this decision and the perjury that occurred.

What it was, Chris, is all the way up to J. Edgar Hoover, they have known since 1965 that my client has been innocent.  They have known it from two sources.  One was their prized informants had told them that Salvati was innocent, and two, from a three-and-a-half-year illegal wiretap on Raymond Patriarca, the alleged head of organized crime in the New England area.  The FBI had...

MATTHEWS:  You mean the guy from Providence.

GARO:  That is correct. 

MATTHEWS:  Yes, I know about him. 

GARO:  And what they did is, they took tape recordings.  They took notes. They took logs.

And everything that was said there went up to J. Edgar Hoover, all the way up the line.  They knew my client was innocent.  As we talk today, they have that evidence.  At the trial, they stated they had no duty to disclose to my client...

MATTHEWS:  OK. 

GARO:  ... his lawyer, or the state that he was innocent.  They had no duty to disclose, even though he was facing the electric chair. 

MATTHEWS:  OK.

Let me go to Mr. Salvati. 

You, sir, served all the—where did you—where did you serve all that time? 

JOSEPH SALVATI, FALSELY CONVICTED OF MURDER:  All over.  We started out in Walpole and ended up in Norfolk. 

MATTHEWS:  And, all that time, you knew you hadn‘t committed the crime. 

SALVATI:  Absolutely. 

MATTHEWS:  And what did you think of your defense?  I mean, how did this happen?  Was this something that you were railroaded by the top?  Do you believe J. Edgar Hoover was involved with this? 

SALVATI:  Absolutely, with no—without a doubt. 

MATTHEWS:  How do you know? 

SALVATI:  Well, it‘s proven.  We have a lot of papers that prove it.

GARO:  We—we filed evidence, Chris, at the time of trial, that J.

Edgar Hoover knew everything that was going on in this case. 

And, in fact, if he was alive today, I would be requesting that he be indicted as a conspirator to murder Joe Salvati. 

MATTHEWS:  Well, what was Hoover—in his own conscience, such as it was, what was his justification for putting four innocent men in prison for life?  What did he have to justify that kind of awful decision? 

GARO:  PEG, power, ego, and greed.  The more convictions they get, the bigger the budget they get.  But, at the same...

MATTHEWS:  OK.  Come on.  You have got to narrow it down a little bit, Victor.  Give me the best—were they using this to protect another source, to protect a friend of another source? 

GARO:  Oh, they were doing this to protect their informants. 

MATTHEWS:  Right. 

GARO:  The informants were the killers.  They were using these—it was more important for the government to protect their murderous informants than it was to protect an innocent man who had young children.  That‘s what is so outrageous of this.

They protected the murderers themselves.  And they became informants for the FBI.  This is all about hiding the evidence for over 30 to 40 years.  The truth has never come out. 

MATTHEWS:  Let me ask you, Mr. Salvati.

GARO:  It did come out at trial.

MATTHEWS:  What did—what did it do to your life, to be in prison for that 30 years? 

SALVATI:  Oh, it destroyed it.  The only thing that kept us together was my—the glue that held—my wife, Marie.  She held the whole family together.

MATTHEWS:  She always knew you were innocent? 

SALVATI:  Absolutely.  The whole family stuck with us and stuck with me.  And what they done was, they took all the youth away from my wife and my family.  And they—they just—and didn‘t care.

This is America.  It‘s not supposed to happen.  The very same people that are supposed to protect you are putting you to death.  It‘s...

MATTHEWS:  Let me ask you.  You got on parole.  Did you get out before the evidence got out that you were innocent?  Or did you just get out because you served your time?

SALVATI:  I got a commutation from Governor Weld. 

GARO:  No, this was—this was a—we got a commutation, like a parole first.  I had been—I have been working on the case for free since 1977. 

(CROSSTALK)

MATTHEWS:  How much of this has to do with Whitey Bulger, Billy Bulger‘s brother, and all of stuff you see in the movies, and all this gangland stuff, and informants, and deal-making by the FBI, Victor? 

GARO:  There was part—that‘s part of it. 

What it is, is, they were informants.  They were prized informants.  What it was is, this criminal element was testifying against—gave evidence on this criminal element.  And the FBI, with their protection, allowed this criminal element to do everything they wanted to do, including murder. 

MATTHEWS:  OK.  What role did Dan Rea up there play, the—the local reporter, Channel 5 guy?  What—what role did he play here? 

GARO:  In—I had been on the case since 1977.  In 1993, I had obtained quite a bit of evidence.  But I knew I needed some media exposure. 

I went to Dan.  It was put—he was introduced me through dean Cass, the dean of Boston University School of Law.  I told Dan about this case.  He studied it and he went with me.  He‘s been on the case since 1993 with us and has reported several times. 

As a matter of fact, he was—he was—it was made a mockery in the newspapers by saying, mission impossible.  Has Dan Rea gone over the line?

MATTHEWS:  Well, I‘m very proud to be in the same world and the same business of television journalism as Dan Rea, because he told me about this case.  He didn‘t tell me what a role he played in it.  Boy, what a courageous move by a journalist, to find the truth and to bring it out and have it matter, the truth.

Congratulations, Mr. Garo. 

On behalf of our country, I‘m apologizing to you, Mr. Salvati.  J.

Edgar Hoover doesn‘t look too good tonight.

Thank you, gentleman, for coming on. 

Up next:  Michelle Obama tells us her girls say that their dad—I can‘t believe this—stinks.  With Barack down double digits to Hillary, is this—is this working, this dumping on the husband, this Vaudeville act?  Why does Michelle keep sticking it to her husband?  He needs some help.

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

Let‘s get into the political world. 

There‘s an old phrase in politics.  I heard it years ago.  Behind every great man, there‘s a woman trying to kill him.  Now, that can be unkind, but you get the point.  Sometimes, the person giving the candidate the toughest time is the spouse at home, the one who is not getting the attention, the one who gets mighty jealous, in fact, when she hears the hubby getting all the attention from the jumpers out there in the audience and on the campaign staff.

So, with that questionable bit of political culture and legend, meet

Michelle Obama.  She just told “Glamour” magazine that her two girls get

into bed with her in the morning, but insist on kicking her husband, Barack

Obama, out of that bed, the hero running for president, of course, because

quote—“He snores and he stinks.”

               

What, for God‘s sake, is the point of someone saying that about a candidate who is a full 20 points behind Hillary Clinton right now?

Please, Michelle.  This guy needs all the buildup he can get.  No more put-downs.  No more stinky-poo. 

This is all real, by the way. 

And, oh, boy, the man who targeted the axis of evil, instead of keeping his eye on the ball, on Osama bin Laden, is at it again.  President Bush, down in Australia the other day, seemed to tear up the Korean armistice, the one Ike forged back in ‘53, by saying—I don‘t who—which neocon is writing this stuff for him—that the Korean War is still being waged. 

(BEGIN VIDEO CLIP)

ROH MOO-HYUN, PRESIDENT OF SOUTH KOREA (through translator):  If you could be a little bit clearer on your message, I think...

(CROSSTALK)

ROH (through translator):  ... I would very much appreciate it. 

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  I can‘t get make it any more clear, Mr. President. 

We look forward to the day when we can end the Korean War.  That will end—will happen when Kim Jong Il verifiably gets rid of his weapons programs and his weapons.

(END VIDEO CLIP)

MATTHEWS:  I don‘t get it. 

Why is this American leader trying to rip up the scab, rip the scab off the treaty signed a half-century ago?  President Eisenhower ended the Korean War after promising to do so.  President Bush elected to start the Iraq War, and now nobody can tell us how to end that one.  Is his goal to leave office with war on all fronts?

Well, as Al Franken gears up for his Senate fight out in Minnesota against Republican Norm Coleman, Republicans are zeroing in on Franken‘s history of using crude jokes.  “The Wall Street Journal” reports that they have been combing through his “Saturday Night Live” transcripts, and taping his casual banter out on the campaign trail. 

Last fall, for example, Franken called Coleman, the incumbent—quote

“one of the administration‘s leading B”—fill in the blank—“boys.”

In response to Coleman‘s complaints, Franken said: “It was meant as a joke.  I should have said, well, lapdog.  And I have said I will use lapdog from now on.”

Well, Al, I think we got the point the first time. 

Besides, I know a guy who got himself elected to the U.S. Congress by calling his opponent, the incumbent, a jerk.  Sometimes, the nasty word is the nasty truth. 

Up next, our HARDBALL debate:  Who lost bin Laden? 

You‘re watching it, HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

REBECCA JARVIS, CNBC CORRESPONDENT:  I am Rebecca Jarvis with your CNBC “Market Wrap.”

Stocks plunged after the latest jobs report.  The Dow Jones industrials lost nearly 250 points.  The S&P 500 fell 25, and the Nasdaq dropped more than 48 points. 

Wall Street was stunned when the Labor Department reported this morning that the economy lost jobs last month for the first time in four years.  Payrolls shrank by almost 4,000.  An increase of about 100,000 jobs had been expected.  Job growth in July was also revised downward.  All this raised fears that the housing slump and credit crunch could push the economy into a recession. 

But analysts say the shocking job numbers could give Federal Reserve policy-makers a reason to cut interest rates when they meet September 18. 

Meantime, oil rose 40 cents in New York today, closing at $76.70 a barrel. 

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

HARDBALL. 

MATTHEWS:  Welcome back to HARDBALL. 

Well, he did it again.  Osama bin Laden sent the U.S. another video message as the sixth anniversary of his attack on America approaches.  With all our technology, firepower, intel, military might, who lost Osama bin Laden? 

I‘m joined by former San Francisco Mayor and former Assembly Leader in California Willie Brown, and Heidi Harris, who is a radio talk show host in Vegas. 

Let me start with the Mayor.

Mayor Brown, you‘re a politician.  Why can the president walk away from the number—public enemy number one for six years, and not take any hit for it? 

WILLIE BROWN (D), FORMER MAYOR OF SAN FRANCISCO:  Well, it‘s because people really haven‘t laid it on him, as they attempted to lay it on Bill Clinton. 

If you will recall, Chris, Bill Clinton said, unequivocally, he failed to find join capture and kill bin Laden.  And, for that, he was indeed, sorry.  This new president, however, didn‘t even look for bin Laden in the first eight or nine months of his term as president of these United States.

Yet, we Democrats have not laid it on him hot and heavy.  And that‘s too bad. 

HEIDI HARRIS, RADIO TALK SHOW HOST:  Oh, come on. 

MATTHEWS:  Heidi Harris.

HARRIS:  The only reason that Bill Clinton said he didn‘t find bin Laden is because he‘s no longer in office, so he‘s no longer capable of trying.  President Bush hasn‘t given up yet. 

BROWN:  President Bush is...

(CROSSTALK)

MATTHEWS:  Let me ask you, Heidi.  Make the case, Heidi, do you have any evidence that the president has made this priority number one?  I don‘t see this guy‘s face on the post office wanted list.  I don‘t see the United States troops chasing after him in back Pakistan.  I see the American Army in Iraq, not where bin Laden is.

HARRIS:  Well, we still have troops...

MATTHEWS:  You tell me, what‘s going on? 

HARRIS:  We still have troops in Afghanistan.  They are still actively searching for him on a daily basis.  I don‘t know that he‘s in Iraq.

MATTHEWS:  But he‘s not in Afghanistan.

HARRIS:  Well, do you know where he is, Chris? 

MATTHEWS:  Well, everybody in this administration is saying he‘s probably in the northwest region of Pakistan.  That‘s what all the administration people are saying.  So, why aren‘t they there looking for him? 

HARRIS:  Well, I don‘t know where he is for sure, and I don‘t know that they know where he is for sure.  That‘s the problem. 

And we do need more cooperation from Musharraf.  We‘re not getting the cooperation that some people think we should be from him.  That‘s a big factor. 

MATTHEWS:  Let me ask you...

BROWN:  Chris, let me assure you and...

MATTHEWS:  Go ahead, Mayor.

BROWN:  ... and Heidi both, if 180,000 troops, as currently are encased and, I suppose, entrusted in Iraq, we do 180,000 troops in Pakistan on the border between Afghanistan and Pakistan, we would find a flea, including bin Laden. 

MATTHEWS:  Heidi?

BROWN:  So, is that what we should do, move all our troops totally to Pakistan, and forget about Iraq?  Is that what you think we should do? 

BROWN:  I think we never should have gone into Iraq. 

HARRIS:  Oh, there we go.

BROWN:  We were never—we were never, never involved in any manner and with any threat from Iraq.  That was...

HARRIS:  Yes, there‘s no al Qaeda in Iraq.  That‘s right.  Oh, here we go. 

BROWN:  That was orchestrated by an administration that has led this nation to the lowest form of acceptability for the rest of the nations of the world.  And that‘s a tragedy.

(CROSSTALK)

MATTHEWS:  Let me ask you, Heidi, about the president.  There‘s no one who didn‘t cheer the president when he stood at ground zero that Friday after 9/11...

(CROSSTALK)

MATTHEWS:  ... and put his arm around that firefighter, and said, we‘re going to get the people that knocked down this building. 

HARRIS:  That‘s correct.

MATTHEWS:  If that was the goal, to catch the Islamic fascists, as they are called now, to catch bin Laden and his people, al Qaeda, if that was the goal, why did we go to Iraq? 

HARRIS:  Well, here is the thing.  When we...

(CROSSTALK)

MATTHEWS:  Well, why did we go to Iraq, if that was the goal? 

HARRIS:  Well, we didn‘t go to—but, Chris, we didn‘t go to Iraq first.

We have got them on the run.  We have to chase them from place to place.  When we get people like Khalid Sheikh Mohammed, President Bush never gets any credit for that.  When we get people like Zarqawi, President Bush never gets any credit for that. 

It‘s like that old Whac-A-Mole game at the carnival.  You know, you whack one down and the next one pops its head up.  You have got to constantly keep chasing these people.  But the idea that they‘re going to stay in Afghanistan, if that is where we are, is ludicrous.  Of course they are going to go somewhere else, and we‘re going to have to chase them when they go. 

MATTHEWS:  But we moved the Army.  We never put in a full complement of troops in Afghanistan, because they were already being deployed to Iraq.  Wasn‘t that a mistake, Heidi, to stop one war before we won it? 

(CROSSTALK)

HARRIS:  But we haven‘t stopped the war in Afghanistan.  We haven‘t. 

We have more troops in Iraq, but we have not finished looking for bin Laden.  We just don‘t know exactly where he is.  If we do—did, if the administration knew, they would find him.  They would capture him.  Of course they would like to. 

MATTHEWS:  Mayor, talk about the Democrats.  You know, bin Laden, who knows nothing about our politics, except how to play some games against us, says the Democrats haven‘t fought politically hard enough to catch—to end this war in Iraq, because they are bought out by the corporations. 

Your response?

BROWN:  My response is, they will pay for that in the 2008 elections, if the public believes that. 

The public didn‘t believe that the last time around.  And that‘s why the Democrats won control of both houses of Congress.  My guess is that, if they continue in the vein they are in, they will have trouble convincing the American people that they‘re sincere on this war issue as well. 

We have got a golden chance to win the presidency and both houses of Congress again in 2008, but it depends on our credibility vis-a-vis this war. 

HARRIS:  Oh, I can hardly wait. 

MATTHEWS:  Do you believe the Democrats have been too soft in attacking the president‘s war position, Mayor? 

HARRIS:  There‘s no question.  I think Barbara Lee and that crowd have been more militant on the issue involving the war, and the Democrats ought to follow that. 

HARRIS:  Oh, my gosh.  You know, I can hardly wait until 2008.  All I ever hear from the Democrats, all the people running for office, most of Congress, all the Democrats who are against the war, all I hear is, we have to get out. 

I don‘t ever hear, we need to win the war.  I hear, we need to end the war.  I have not heard one solid plan out of any Democrat.  So, if they get what you would like them to get in ‘08, Willie Brown, I would love to see them succeed.  I don‘t know what their plan would be. 

And I don‘t know that the American people have the confidence in them to vote Democrats in, in the majority or as...

BROWN:  You see, Heidi...

(CROSSTALK)

HARRIS:  ... Democratic president.

BROWN:  You see, Heidi, I accepted George Bush‘s pronouncement on that aircraft carrier.  He said, in effect, the war is over, we‘ve won.  And that‘s the point at which we should have split right out of Iraq, gone over to Pakistan and Afghanistan, and by now there would not be video coming out of bin Laden.  There would be memorials coming from bin Laden. 

MATTHEWS:  Ladies and gentlemen—I want to ask Heidi this question. 

Let‘s be nonpartisan here for three seconds. 

HARRIS:  OK. 

MATTHEWS:  Everybody said—maybe our intel was wrong.  Here‘s a guy, an extremely very tall man for that part of the wall, 6‘5 or something, very distinctive face.  I mean, once you see bin Laden, you sort of know what he looks like.  Riding on a Burro with dialysis, because he had a bad kidney problem.  And he‘s escaping through the mountains on this Burro, and he‘s 6‘5, and he‘s got dialysis equipment with him or something.  Why is it so hard to catch him? 

Everybody thought at the time he would be an easy mark.  What do you think happened? 

HARRIS:  You‘re asking me? 

MATTHEWS:  Yes, I want to know what you think happened, as a snoop, as a journalist?  Just tell me what happened.  How did this guy get out of Tora Bora?  How did he get across the border or wherever he went.  He could be in Chicago for all we know.  How did he get away? 

HARRIS:  That‘s a good point.  Here is what I think, when you plan something that catastrophic on American soil, and you plan it far ahead, which we know he did, obviously, you plan many ways to hide, because you know we‘ll come looking for you.  Not to mention the fact that if you ingratiate yourself with the villagers in the various areas where he was, why would they tell our troops where he is?  He‘s their friend, not our friend.  That‘s something we‘ve had to try to overcome.

MATTHEWS:  That‘s a bigger problem.  The people in the Islamic world -

When I‘m in Kenya, mayor—I‘m in Kenya last year on vacation, in Lamu, out on the coast, and they have bin Laden posters all around.  That is a problem.  He‘s a hero in that part of the world. 

HARRIS:  That‘s right. 

BROWN:  And he will continue to be a hero to that part of the world, and that‘s why it‘s necessary for us to exhaust ourselves in those regions, where he‘s allegedly currently hiding.  I can assure you, just as we found some of the other members of that 52-card deck, we can find bin Laden.  But it‘s going to take somebody with a greater talent than currently exists running the White House. 

MATTHEWS:  I would love to have the job of catching him.  Anyway, thank you Willie Brown, former mayor, former assembly leader, one of the heroes of California.  Heidi Harris, thank you for coming on the show. 

Up next, our HARDBALL round table and the 2008 spouse factor. 

Michelle Obama is something else.  What‘s she going after her husband for?  Shouldn‘t she be going after Hillary?  Anyway, we‘re going to talk about that.  Guess whose coming, Nora O‘Donnell, mother of two, mother of twins.  She‘s coming back on HARDBALL right now, Nora O‘Donnell.  We‘ll be right back.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Tonight‘s HARDBALL round table, Craig Crawford is a columnist for “Congressional Quarterly.”  Jonathan Capehart sits on the “Washington Post‘s” editorial board, an extremely prestigious crowd, and MSNBC political analyst.  And by the way, MSNBC‘s chief Washington correspondent Norah O‘Donnell is coming back to HARDBALL at this very moment.  She‘s a mother now of twins, Grace and Henry. 

Can we look at the picture?  What a mommy.  Look at the blue eyes, all six blue eyes you have there.  What a picture.  Hold that picture, it will be the nicest thing we see all night.  Norah, there the kids are.  Which one is which? 

NORA O‘DONNELL, MSNBC CHIEF WASHINGTON CORRESPONDENT:  Henry is in the blue, and Grace is in the pink. 

MATTHEWS:  I should have known. 

O‘DONNELL:  Yes.

MATTHEWS:  What does it feel like to be a mom. 

O‘DONNELL:  Those outfits are from Chuck Todd, our political director. 

MATTHEWS:  Thank you Craig, you‘re the expert on such things.  Let me ask you Norah—it‘s nice to see you back.  You look like no worse for wear. 

O‘DONNELL:  It‘s the greatest thing in the world. 

MATTHEWS:  Let‘s talk about—get in trouble.  I want to start with this Michelle Obama thing, because we have a woman on here who‘s a great wife and a great mother, obviously.  I‘ve got to ask you, Michelle Obama, what is her number?  What is she saying.  In the morning my two daughters get in bed with me, which kids like to do, and they won‘t get in the bed until they kick Barack Obama out of bed, because he snores and he stinks.  What is this about? 

O‘DONNELL:  She said that she made the comment because she doesn‘t want people to deify him and think he‘s a god. 

MATTHEWS:  He‘s 20 points back. 

O‘DONNELL:  There‘s two ways to think about this.  Either this sort of humanizes him in some sort of way.  Or some people say it‘s TMI, that people want to deify the president.  They don‘t want to know he‘s stinky and snory. 

MATTHEWS:  I don‘t think Nancy Reagan, Jonathan, was out there saying my husband stinks and snores.  That wasn‘t a great build up.

JONATHAN CAPEHART, “THE WASHINGTON POST”:  No, Nancy Reagan probably never said that publicly. 

MATTHEWS:  We‘re talking about publics. 

CAPEHART:  Let‘s put this in context, though.  She didn‘t say the girls kick him out of bed.  They say they get into bed if he‘s not there because he‘s too—

O‘DONNELL:  Still. 

MATTHEWS:  It‘s unbelievable.  The trouble is people will believe that line from the kids.  They won‘t believe anything else these politicians say.  But they‘ll believe those charges. 

CAPEHART:  Why is this—why is this such a big deal? 

MATTHEWS:  Let‘s go to Craig Crawford, the political expert.  Craig, it‘s a schtick.  Obviously it‘s a schtick.  I know it‘s aimed at being regular folks and all.  But it does detract from the fact that she is supposed to says this guy really has a vision for America.  This guy can bring together the country racially, politically, ethnically.  This guy can change America.  Doesn‘t she have to be a true believer if she lives with the guy? 

CRAIG CRAWFORD, “CONGRESSIONAL QUARTERLY”:  She is out there giving substantive speeches.  I think, in addition to what Norah mentioned, which is true, she‘s concerned about his deification and humanizing him, she is also signally that she‘s not going to be a Stepford Wife. 

MATTHEWS:  No doubt about that.  I tell you.  You know, Lily Martin used to work at the White House with me.  He‘s the civil rights guy.  He said behind every great man, there is a woman trying to kill him.  This is true.  Let me—I love that.  Thank good for Norah‘s cackle.  It‘s back.  Yes dear?

O‘DONNELL:  listen, you are talking about this in the context of the spouse factor.  This is the year of the spouse.  We have so many interesting—

(CROSS TALK)

O‘DONNELL:  Elizabeth Edwards, who is enormously outspoken, criticizing a lot of Democrats.  We have Bill Clinton, of course, who wants to be the first laddie, as he says, in the White House, and Michelle Obama, who is impressive. 

MATTHEWS:  My dog was named Laddie.  I wouldn‘t use that if I were him.  There are already complaints in that department. 

O‘DONNELL:  The better question for a historian too is how much personal information do people want to know about their president. 

MATTHEWS:  What‘s that phrase everybody uses, too much information? 

O‘DONNELL:  TMI. 

MATTHEWS:  Is this too much? 

O‘DONNELL:  It may be TMI. 

MATTHEWS:  Let me ask you, Jonathan, about this question.  Certainly Bill Clinton is helping Hillary in the Democratic primary.  We all agree with that.  Maybe in the general he‘ll be a problem.  He helps, right?  We agree. 

CAPEHART:  Sure.

MATTHEWS:  Craig, your assessment, does Bill help Hill in the Democratic primaries and caucuses? 

CRAWFORD:  I certainly do, particularly in the primaries and caucuses.  He‘s so popular among Democrats.  He‘s also been out there pushing a book, getting on Oprah himself, Larry King, lots of places, and being very out front.  I think his position in this is actually one thing that has caused a sort of reshuffling of the deck on the roll of spouse, when you have a candidate who has got a former president as a spouse and will certainly serve some sort of substantive role in the Clinton administration. 

(CROSS TALK)

CRAWFORD:  The other spouses, I think, feel a little pressure to come out and be a little more than what spouses have seen on the surface. 

MATTHEWS:  OK, I want to make a nomination for spouse of the week. 

Who has been the best, most loyal spouse of the week. 

CAPEHART:  Clinton. 

MATTHEWS:  Best spouse of the week?

O‘DONNELL:  Well, Clinton helped, going on Oprah, when she was on Ellen.  Seventy percent of the people in the last Gallup poll said they think he‘s an asset. 

MATTHEWS:  You know who has been the most loyal political spouse of the week?  Mrs. Larry Craig.  She comes out and stands with him, two press conference in a row, totally denies the charges, completely with the guy.  There has never been—Nancy Reagan is a piker compared to this woman.  This is Stepford Wife exponentially.  We‘ll be right back with our round table.  You are watching HARDBALL on MSNBC.  Welcome back, Norah. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  We‘re back with the round table, Craig Crawford, Jonathan Capehart, and Norah O‘Donnell.  Let‘s take a look at Fred Thompson advisor Rich Gallen and what he said about Thompson‘s wife, Jeri, his much younger wife, “look, she‘s either too involved or she‘s the trophy wife sitting out by the pool eating bonbons.  You can‘t have it both ways.” 

What does that mean, Craig?  Is she—well, we look at the picture; I guess she could pass as a trophy wife if you just go by appearance, but what is this bonbons sitting by the pool remark? 

CRAWFORD:  I think because she‘s attractive these comments are made.  But she is clearly playing a substantive role in the campaign and I don‘t see anything wrong with that. 

MATTHEWS:  Let me ask you, Jonathan.  I think she will attract attention.  He‘s about 65.  She‘s about 20 years younger.  Is that going to hurt him on the trial with first wives, second wives, and everything else in this business. 

CAPEHART:  With all of the other people with their second wives and third wives and fourth—who knows. 

MATTHEWS:  The only Republican with one wife is the Mormon. 

CAPEHART:  Governor Romney.  So I don‘t think that is going to be a big deal.  I really don‘t. 

MATTHEWS:  How about the role she‘s playing in the campaign?  Apparently the aides are dropping like flies around Thompson, because she doesn‘t like people. 

O‘DONNELL:  She has been criticized by some as playing a -- 

MATTHEWS:  I love the way you do this.  This is the Norah O‘Donnell merry go round.  There are some who say—

(CROSS TALK)

O‘DONNELL:  How many times have candidates‘ spouses wives been criticized for being too involved. 

MATTHEWS:  They are too involved.  Every time the guy goes to bed, they say, I don‘t think that guy is on your side, or I think -- 

O‘DONNELL:  But people act surprised that a wife is involved.  This man chose to marry her.  He confides in her.  That‘s what Fred Thompson said defending her.  He said thank goodness she‘s there.  He said she‘s part of the main reason he‘s running.  

(CROSS TALK)

CRAWFORD:  I think it‘s a good thing that these wives who are involved

it‘s now out in the public and we know about it.  In the old days wives ran things behind the scenes and kept it quiet.  I think it‘s better to be outside.

MATTHEWS:  It‘s two for the price of one now.  We know the price tag and we know the product.  Let me you, Craig, about something he may have been ill-advised to say today.  In this whole discussion about the bin Laden tape we have been talking about tonight that just broke—and we are getting to probably see it tomorrow sometime.  He said bin Laden was just a symbol.  He was quoted in a way to suggest that he‘s not the worst menace in the world.  He‘s just a symbol. 

Is that going to be a smart thing to say when guys like McCain are out there ready to jump on him? 

CRAWFORD:  I think it‘s been striking, Chris, particularly with the Democrats, who you would think have an incentive to really jump on this notion that hey, look, we haven‘t caught him.  I think everyone who is thinking about potentially becoming president realizes if they set up bin Laden as a template, as a standard for their presidency, catching him, they may not be able to fulfill that. 

So official Washington is really on both sides of the fence, almost been declaring him irrelevant for a long time now, because they can‘t find him.  They can‘t catch him, so they want us to—

MATTHEWS:  You know the old wimpy line in the Popeye comics was, I will gladly pay you on Tuesday for a hamburger today.  All they want to do is get that election today and they will promise to get anybody. 

O‘DONNELL:  There is something specific, a distinction worth making here.  What Fred Thompson said about bin Laden, he said it‘s more symbolism than anything else, the tape.  What John McCain said is this just shows how strong the commander in chief has to be, and it will be my mission to get Osama bin Laden.  That‘s sort of the difference that some people are pointing out today in the response of these two Republican candidates.  Everyone is watching Fred Thompson very, very closely this week to see if he actually has what it takes. 

MATTHEWS:  Yes, what do you think? 

O‘DONNELL:  We don‘t think we know yet. 

MATTHEWS:  Let me ask you, Craig, about the different roads we could have taken, the roads less travelled by.  Had President Bush pursued bin Laden, put full force into Afghanistan, dealt with Musharraf in a way that cornered this guy, caught him and focused entirely on the destruction of the al Qaeda network, beginning but not ending in Afghanistan, not going into Iraq, put up with that pain in the butt in the region, Saddam Hussein, but focused on the al Qaeda network, which still threatens us even today in Germany. 

Had he focussed in that direction, weeding out al Qaeda, would he be a successful president today? 

CRAWFORD:  He would be at 60 percent, 70 percent approval in the polls, and his party would not have lost control of Congress.  I think that is—historians will say this is where his presidency went down.  Also, I think we played into bin Laden‘s hands.  And hearing this tape and reading what we have seen so far, this confirms to me what he always wanted is for us to languish troops in the Middle East, destabilize the region—

MATTHEWS:  Create and east-west war, in which the east would have to choose sides and they would choose him.  Jonathan? 

CRAWFORD:  What he and Bush have in common is they both want us to stay in Iraq. 

CAPEHART:  I agree with Craig.  The president would be at 60, 70 percent, if he had stayed focused on getting bin Laden and focused on rooting him out of Afghanistan or Pakistan. 

MATTHEWS:  Right that as a column in the “Washington Post.”  I will read it and advertise it. 

CAPEHART:  That Fred Thompson symbolism comment is the Republican equivalent of John Edwards saying the war on terror is a bumper sticker for the Bush administration. 

MATTHEWS:  Big mistake.  Thank you.  It‘s great having you on, Jonathan, smart guy.  As always, Norah O‘Donnell, mommy, great to have you.  Craig Crawford—names Henry and Grace.  Right now it‘s time for “TUCKER.”

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

END   

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