updated 9/20/2007 1:17:30 PM ET 2007-09-20T17:17:30

Guest: Scott Glover, Bill Bastone, David Bonior, Wes Clark, Pete Hegseth,

Jonathan Allen, Joan Walsh, Ross Douthat

CHRIS MATTHEWS, HOST:  Naked gun—Simpson gets charged with 10 counts of felonies and now faces spending the rest of his life in prison.  Is this the punishment he escaped for murder?

Let’s play HARDBALL.

Good evening.  I’m Chris Matthews.  Welcome to HARDBALL.  The big story tonight: Leaving Las Vegas.  O.J. Simpson, who now faces felony charges, including kidnapping and robbery with the use of a deadly weapon, posted bail today.  Let’s get to what really happened that night in Las Vegas in that hotel room.  We’re going to get the facts tonight.

Our second story tonight, Hillary Clinton hanging with lobbyists.  John Edwards seems to be the only one with guts enough to take on the front-runner, and that’s Hillary.  His top aide calls her campaign corrupt for holding a fund-raiser in Washington to introduce lobbyists, people selling stuff to the government, to congressional members.

And the Senate is debating a bill tonight that would allow troops more time at home before being redeployed back to Iraq.  The Bush administration says the president will veto the bill.  That’s our HARDBALL debate tonight, and it’s a hot one.

But we begin with David Shuster’s report on what happened in that room in Vegas and the latest on the Simpson case.

(BEGIN VIDEOTAPE)

DAVID SHUSTER, HARDBALL CORRESPONDENT (voice-over):  In front of a daughter who did not want to be photographed and before a packed courtroom filled mostly with reporters, today O.J. Simpson faced a judge for the first time since his arrest.

JOE BONAVENTURE, JR., NEVADA JUSTICE OF THE PEACE:  Mr. Simpson, do you understand the charges against you?

O.J. SIMPSON:  Yes, sir.

SHUSTER:  The judge read back from the criminal complaint, which charges Simpson with kidnapping with use of a deadly weapon, armed robbery, coercion with use of a deadly weapon and assault with a deadly weapon.  Simpson did not enter a plea today.  That will happen later this fall.  This morning, the court dealt with terms for Simpson’s release, agreed to by the prosecution and defense.

BONAVENTURE:  Accordingly, bail is set on this case at $125,000 total bail cash or surety.

SHUSTER:  Simpson will be allowed to travel anywhere in the U.S....

BONAVENTURE:  Where do you live, Mr. Simpson?

SIMPSON:  I live in Miami, Florida.

SHUSTER:  ... but Simpson was instructed not to have contact with any witnesses or other defendants in the case.

BONAVENTURE:  Do you understand everything?

SIMPSON:  I do, sir.

SHUSTER:  The short hearing then ended, and Simpson was processed and released.

Simpson’s trial next year will revolve around what happened last Thursday night in this Las Vegas hotel and casino.  According to the police report, Bruce Fromong and Alfred Beardsley, two sports memorabilia collectors, were waiting in room 1203.  The room had been rented by this man, Thomas Riccio, who promised the collectors that a buyer would show up who was highly interested in purchasing a lot of valuable collectibles.  The police report says that at approximately 7:30 PM, five men, including Simpson, burst into the room.  One of the startled collectors said the men yelled, Police, and came in military style.

ALFRED BEARDSLEY, WITNESS IN SIMPSON CASE:  I was ordered to stand up, and I was frisked, like—you know, I thought it might have been law enforcement or the FBI or something because I was ordered to stand up and I was frisked for weapons.

SHUSTER:  Beardsley says he believes the intruders had at least two guns.

BEARDSLEY:  I saw one gun, and I know after speaking to my friend and partner, Bruce Fromong—he said, Wait a minute, there were two guns because they had Bruce at gunpoint with a gun stuck in his face.

SHUSTER:  Beardsley says he and Fromong were ordered to turn over sports collectibles that Simpson claimed were his.  The items included autographed footballs, awards and pictures of Simpson in uniform.  On an audiotape obtained by the Web site TMZ.com, Simpson is heard giving orders.

(BEGIN AUDIO CLIP)

SIMPSON:  Don’t let nobody out of this room.  (EXPLETIVE DELETED) think you can steal my (EXPLETIVE DELETED) and get away with it?  Don’t let nobody out of here.

(END AUDIO CLIP)

SHUSTER:  The police report says that within 10 minutes, casino surveillance cameras captured these two men carrying boxes of sports collectibles out of the casino.  The men have not been identified.  Police have identified and arrested three other men who allegedly helped Simpson, including Michael McClinton, Walter Alexander and Clarence Stewart.

Simpson’s lawyer today promised that his client would mount a vigorous defense.

YALE GALANTER, SIMPSON ATTORNEY:  Listen, we are going to be examining, you know, what deals, what promises, what went on behind the scenes.

SHUSTER:  In front of the cameras, though, the circus has begun.  Note the man with the “O.J. in ‘07” T-shirt.  He made himself part of the Simpson defense team.

GALANTER:  That’s what he criminal defense lawyers do, we plead not guilty.

UNIDENTIFIED MALE:  Yes!  Yes!

SHUSTER (on camera):  Regardless of the spectacle surrounding another O.J. Simpson legal case, the facts against Simpson as told by the police are stark and incriminating.  But then again, they were the last time.

I’m David Shuster for HARDBALL in Washington.

(END VIDEOTAPE)

MATTHEWS:  Thank you, David Shuster.  This morning on the “Today” show, Alfred Beardsley, one of the witnesses in that hotel room, described how O.J. and his armed accomplices barged through the door of that Vegas hotel room.

(BEGIN VIDEO CLIP)

BEARDSLEY:  One of the thugs—that’s the best way I can call them—somebody blurted out, Police.  And they came in military style, or just like police officers would come in.

I saw one gun, and I know after speaking to my friend and partner, Bruce Fromong—he said, Wait a minute, there were two guns, because they had Bruce at gunpoint with a gun stuck in his face.

At no time did Mr. Simpson hold any kind of firearm.

(END VIDEO CLIP)

MATTHEWS:  Well, that witness, Alfred Beardsley, who we just saw in that video clip, was arrested a short time ago in Las Vegas and is being held for a parole violation, warrant is out of California—just another twist in this story.

For more on the details of what really happened in that Las Vegas hotel room, we turn to Scott Glover of “The Los Angeles Times,” who spoke to O.J. Simpson shortly after the incident, and Bill Bastone of Thesmokinggun.com.  Let me go right now to Scott Glover.  Give us a—me a picture of what you know to be the narrative of what happened in that hotel room.

SCOTT GLOVER, “LOS ANGELES TIMES”:  The narrative coming from Mr.

Simpson?  I talked with him...

MATTHEWS:  No, coming from the police.

GLOVER:  Coming from the police?  Well, you know, in your intro, you talked about getting to the facts of that, and I don’t know that that’s possible at this point.  I think it’s very much a “He said, he said, he said” type of situation, with a cast of characters who have credibility problems.

I mean, Mr. Simpson and Mr. Riccio describe a sort of vigilante sting operation, where they were hoping to get Mr. Simpson’s property back, Mr.  Riccio says in a peaceful manner, and that it got out of control.  Mr.  Simpson describes the same thing.  In the interview that I had with him, he described a much calmer situation than what you hear on the tape.  What ultimately happened in that room, I don’t know.

MATTHEWS:  Well, how can you possibly believe O.J. Simpson’s account when you have the tape recording available to you?

GLOVER:  Well, I guess—I guess you can’t.

MATTHEWS:  OK.  Let me go to Bill Bastone.  Bill, give me what you think—what you know to be what happened in there, based upon the police report, let’s put it that way.

BILL BASTONE, THESMOKINGGUN.COM:  Well, I think what happened here was Riccio clearly was in—you know, he set it up.  I think what he was looking to do was he probably saw a future for himself as O.J.’s memorabilia dealer.  He brought these guys, you know, O.J. and a group of people, into the room, and seemed as if kind of all hell broke loose.  I mean, you can hear it on the audiotape.

In the interviews—I mean, the police report is kind of interesting because not only was Mr. Simpson talking to Scott Glover and talking to the AP, there’s two pages full of O.J. Simpson quotes to the cops when they initially spoke to him.  And he—you know, he paints a picture where it was just, I was just going in there to retrieve the stuff.  But Riccio, Fromong and Beardsley, you know, talk about basically being—having guns placed on them, Fromong and Beardsley, and basically have their stuff ransacked.

MATTHEWS:  Let me get one fact clear, if we can, Scott.  First of all, I understand—is this true, based upon your reporting, that the police do have two guns in custody?

GLOVER:  I am unaware that the police have two guns in custody.  I mean, we have a reporter who’s based in Las Vegas.  He’s following the breaking events there.  That may be.  I do not—I’m not personally aware of that.

BASTONE:  They actually have—when they executed a search warrant, the first search warrant they executed, they recovered a Beretta and a Ruger that they contend—the police contend were the weapons that were used during the heist.

MATTHEWS:  And they picked them up from the people that were involved in the incident in the room.

BASTONE:  Well, after they arrested Walter Alexander—he was the second guy to get popped—he clearly made post-arrest statements that led to three search warrants being executed.  And during those search warrants, they recovered some of the memorabilia and also the two handguns.  They were executed at private residences in the Las Vegas area.

MATTHEWS:  Scott, how did O.J., when you spoke with him after the incident, explain the use of guns, or he just never mentioned that there were guns involved?

GLOVER:  He insisted that there were no guns involved.  He said that this was just, you know, an operation that he and Riccio had put together, where he was hoping to reclaim what was rightfully his, that he acknowledges getting emotional and yelling but is steadfast that there were no guns.  And if I’m not mistaken, Mr. Alexander—his attorney says that he also denies there being any guns involved in the incident.

MATTHEWS:  Well, that’s what defendants do, of course.

(LAUGHTER)

MATTHEWS:  I shouldn’t be asking all these questions as if defendants aren’t going to deny.  Defendants deny the accusations.

GLOVER:  Well, when we’re talking about—when we’re talking about weapons being recovered and him leading to those weapons...

MATTHEWS:  Right.

GLOVER:  ... I think it just should be noted that he denies that any were used.

MATTHEWS:  Yes, I understand why you have to report that.  It is part of the story.  Let me ask you about the possibility—I guess O.J.  describes it almost the way a hockey game is being fought, or a football game, and a fight breaks out.  In other words, one thing’s going on, then all of a sudden, something else happened.  I guess that’s their defense, right, that they somehow went in there in a non-violent manner.  It became violent.  Is that the defense, or is it a denial it ever became violent, Scott?

GLOVER:  Well, from Mr. Simpson’s perspective, it’s a denial that it ever became violent.  I mean, this is based on the interview...

MATTHEWS:  There were never any guns, there was never any assault, never any kidnapping, never any threats to people to stay in the room?

GLOVER:  You need to understand, Chris—you need to understand that this is based on the interview that I had with him prior to his arrest, prior to this tape being made public, OK?

MATTHEWS:  Right.

GLOVER:  What was described to me was a much, you know, calmer encounter that involved no weapons and involved no violence.

MATTHEWS:  Do you have a sense, maybe, that you could report objectively that O.J. had a very casual attitude about this whole thing, even after the incident occurred?  We’ve watched a number of these perp walk scenes, where—not exactly perp walk, but like one, where he’s walking cuffed over to the car where he’s chuckling in the car, he seems to be trying to be debonair.  Is that his state of mind, as you could see it?

GLOVER:  When I spoke with him on Saturday morning in the lobby of the Palms hotel, that was exactly his demeanor.  He was dressed in a bathing suit, in a polo shirt and tennis shoes, and was talking about how he can’t believe the way that this has been blown out of proportion.  He can’t believe that people are talking about armed robbery, and so on.  In fact, you know, 20 minutes after we spoke, he called me on my cell phone and was joking and said, Hey, Scott, you know, I thought what happens in Vegas stays in Vegas.  You know, he had almost a flippant attitude about it.

MATTHEWS:  What do you make of that, Bill, this disconnect between the tape recording, the audio, the chart, the 10 counts against him now that could put him away for the rest of his life easily, the serious criminal nature of these charges against him, the arraignment today, and yet his—up until today, when he looked kind of somber today, obviously, when he was being arraigned—kind of a flippant, casual attitude by this guy, who seems to—you know, he does understand the judicial system.  He’s been through it.  He doesn’t seem to understand the gravity of what he’s up against here.

(CROSSTALK)

BASTONE:  It’s kind of interesting.  In the police report, police paint a picture of going to his hotel room at the Palms to do their interview with him.  And he asks a couple of women, unidentified females, who were in the room to leave.  And there’s a little dog in the room also.  But the cops report that he is, like, incredibly friendly.

MATTHEWS:  Yes.

BASTONE:  Hey, come on in, waves and shakes everybody’s hand.  And even though he’s clearly aware that there are reports floating around...

MATTHEWS:  Yes.

BASTONE:  ... that an armed robbery might take place, he’s in a position where I guess he thought, you know, perhaps he could charm these people and that, well, it’s—it couldn’t be anything other than...

MATTHEWS:  Or could it be that he thought that these guys were all such underworld figures, with arrest records and all kinds of problems out there, as we’ve learned, that they’d be the last people to ever go to the police, that this sort of was an “honor among thieves” thing.

BASTONE:  Yes, I have to say that may be part of it.  You have to—you know, the sports memorabilia business draws a lot of sleazy characters.

MATTHEWS:  Right.  And...

BASTONE:  But it’s really the bottom of the barrel of that group that actually deals with O.J. Simpson.  I mean, we did a story on our Web site about Riccio.  This guy is a four-time convicted felon—you know...

MATTHEWS:  Yes.

BASTONE:  ... prison escape...

MATTHEWS:  You know what strikes me?  There’s two theories here.  One, he’s a—well, three.  He’s just a bad guy and he uses guns to get things done.  And that has not been his record for 10 years or so, certainly.  And the other he’s got diminished capacity, he’s just an idiot to think this wasn’t armed robbery.  And the third is he was operating in a world of sleaze, in a dark underworld in which people were rough on each other all the time and they never went to the cops, they sort of settled their matters among themselves and they were just—they just trumped these guys.

But I am looking for an explanation because, Scott, in your reporting, and of course—and Bill, and everything we’ve read, there is a disconnect between the obvious real world this guy’s facing now, going to jail the rest of his life, and the almost comical nature of this escapade.

Anyway, thank you, gentlemen, for coming on and helping to us clear it up, Bill Bastone and Scott Glover.

Coming up: Why is John Edwards the only Democratic candidate willing to take on Hillary Clinton?  His campaign manager is going to come here in just a minute to tell us why they think Hillary’s got some real corruption problems going into this campaign.

You’re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  The John Edwards campaign took a swipe at Hillary Clinton yesterday for a fund-raiser she held here in Washington, saying that that fund-raiser that brought together the kind of Washington insiders that Senator Edwards says are running politics today.  I’m with Edwards’s campaign manager right now, David Bonior.

By the way, we were supposed to be joined at this little roundtable by Texas congresswoman Sheila Jackson Lee.  She’s a Clinton campaign national co-chair.  Well, she was about to come over here about a half hour before broadcast today, and canceled.  I am really wondering what was going on there.  She was at the meeting, let’s be blunt about it, of these lobbyists and members of Congress.

Let me ask you, Mr. Bonior.  You worked on the Hill for years.  You were a member of Congress for many years from Michigan.  Is it kosher to have a meeting set up where you bring a bring a bunch of lobbyists who sell equipment to the federal government, vendors, people that want money from the till, with policy members (ph) -- lawmakers from various committees, set them all together, give them food and booze, and say, Why don’t you guys get together?  And by the way, give me money in my campaign—for this little matchmaking, some might say pimping.  Do you think that’s good politics?

DAVID BONIOR, EDWARDS CAMPAIGN MANAGER:  It’s bad politics for the country.  It’s bad politics for the party.  It’s bad politics for the people who do it, for people who participate in it.  This is part of what we’ve been talking about in the John Edwards campaign of the corrupting and the corroding influence in Washington, D.C.

The situation has gotten so bad that people now wouldn’t even think that this is a problem, that you could bring lobbyists in for $1,000 a ticket, sit them down, get a briefing, have them work together with people who are members of Congress, heads of the committees.  You know, this is how you get no-bid contracts.  This is how you end up with sweetheart deals.  This is how you get a system that’s totally out of control.  And that’s why, you know, Congress’s approval ratings are down at 18 percent today.

MATTHEWS:  How do you beat the Republicans, who the Democrats have attacked for being in bed with Halliburton and giving them all that no-bid money for Iraq—billions of dollars, I guess, you know, Dick Cheney’s old company—and then you admit that the same deal works on the Dem side?

BONIOR:  You know, it doesn’t work for us when you engage in this kind of activity.  So what John Edwards is suggesting—and he’s challenged everybody.  OK, the past is the past.  I mean, you know, everyone’s been in politics a long time.  Going forward, no more lobbyist money into anybody’s coffers, running for president, running for Congress, DNC, members of different parties in the Senate  and the House.  We’re not going to take that money anymore.  We can start there, until we can get a decent...

(CROSSTALK)

MATTHEWS:  But don’t you guys take money?  Isn’t the Edwards campaign funded heavily by the trial lawyers?  They have an interest in government legislation.  They want no caps on damages.  They want to influence policy, right?

BONIOR:  The Edwards is the only—well, actually, Obama’s campaign as well.  We don’t take PAC money and we don’t take any lobbyist money.

MATTHEWS:  But you take money from the trial lawyers.

BONIOR:  Well, we take money from people who want to contribute.

(CROSSTALK)

MATTHEWS:  Yes, but they have got an interest.

(CROSSTALK)

MATTHEWS:  They’re not doing it out of love.  These trial lawyers aren’t exactly sweethearts, you know.

BONIOR:  They have an interest.

(CROSSTALK)

MATTHEWS:  Yes, they want big settlements.  They want huge settlements.  They do not want to be restricted on how much money they get.

Is that fair game?  Is that kosher from your perspective, taking money from trial lawyers? 

BONIOR:  Well, what we would prefer is that we have a situation in which we have public financing.

MATTHEWS:  Hillary can say that.  But Hillary would say that.  I would prefer to get...

(CROSSTALK)

MATTHEWS:  Who wouldn’t rather get free money from the government, if  you don’t have to panhandle for it?

BONIOR:  But she takes it directly from the lobbyists themselves.  And there’s a huge difference.  That’s the link we have to at least start with to break.

MATTHEWS:  She says—and I’m like—I will defend her, because Sheila Jackson Lee got delayed coming over here today somehow, because she must have realized that she was at the meeting we’re talking about.

I will make the case that she would have made, which is that Hillary says, if you’re going to cook up a health care deal, you have got to bring the doctors in the room, you have got to bring the nurses in the room, you have got to bring the hospital people in the room, the insurance companies, or you can’t cut a deal that will pass Congress.  You need to get in bed with these people if you’re going to get anything done.

BONIOR:  Well, that’s the problem with Washington, is getting in bed with these people.  And that is why we don’t have, for instance, today national health.  And that’s what is helped defeat national health insurance, universal health insurance in 1993.

It’s what helped create one of the lousiest pharmaceutical bills in the history of this country.  They wrote it, the pharmaceutical companies.  John Edwards’ position is that you invite these people to sit at the table with you, they’re going to eat all the food.  And I would add also that they’re going to take the silverware and the china with you.

You know, this is a situation in which you have got to stand by some basic principles and take them on.

(CROSSTALK)

MATTHEWS:  I like the way you guys are running this campaign, because you’re taking on the front-runner.

But you have got this guy Barack Obama standing between you and her.  He’s not campaigning.  I don’t know what he is doing.  He is having interviews with people like Brian Williams on the roof of 30 Rock, which are very nice to have if you’re Brian.  But I don’t see how that advances a campaign against Hillary.  He will not go after her.

Can you beat Hillary if you have got Obama standing in your way between her and you?

BONIOR:  We can win this race.  We are leading now in Iowa.  The latest “TIME” magazine poll of about a week-and-a-half ago had us up by five points over Hillary Clinton...

MATTHEWS:  Yes. 

BONIOR:  ... and about seven, I think, over Obama.

And in a four-person race, with the top four candidates, we were up by eight points over Senator Clinton.  So, we’re doing well in Iowa.  We have got a great organization there.

In New Hampshire, we’re running second now, technically.  If you look at the latest polling numbers, Obama is a little bit ahead, but within the margin of error.

(CROSSTALK)

MATTHEWS:  Is this corrupt, what Hillary Clinton is doing, holding fund-raisers with lobbyists, pimping them, basically, saying, if you give money to me, you lobbyists, I will sit you down to lunch with members of Congress, chairmen of committees, and they will sit around with you and you will get to be friends with each other, but give me the money first, and I will set up those deals, those lunches? 

Is that corrupt, that practice?

BONIOR:  That is a bad, corrupt practice, and needs to end.   

And she needs the recognize.  And the fact that she doesn’t and the fact that people in this town...

MATTHEWS:  They used to call this “Eggs McBentsen.”  Remember when Lloyd Bentsen used to have these things, breakfast with lobbyists?

BONIOR:  I know.

And the fact that people don’t recognize the corrosiveness of this just shows you how out of touch they are with the rest of the country.  You  tell this to the rest of the country, the country is going to say, what?  People pay $1,000; then they get to meet with the chairmen of the committee to help...

(CROSSTALK)

MATTHEWS:  It’s called pay to play.  It’s in every big, corrupt big city in the country.  It’s how politics is played at the mayor’s level.  You know that, right?

BONIOR:  Yes, let’s start cleaning it up.  And this is a good place to start, is right here in D.C.

MATTHEWS:  If you want a city contract, you have got to give to the mayor.  You know how this game is played.

BONIOR:  I know how.  I have been in politics for a while now.

MATTHEWS:  Yes, I know.  It’s sweet.  It’s why people hate it.

BONIOR:  And one of the deals is, you know, it used to be what happens in Washington stays in Washington.  Not anymore.

MATTHEWS:  Well, thanks for bringing this out.

BONIOR:  People like that.

MATTHEWS:  I like you guys playing hardball.

Thank you, David Bonior.

BONIOR:  You’re welcome. 

MATTHEWS:  A former member of Congress managing the campaign of John Edwards.

Up next:  Rudy Giuliani goes across the pond, to Britain, to raise money.  Well, we’re outsourcing fund-raising now?

And Fred Thompson takes another misstep in Florida.  We will have the very latest from the 2008 campaign trail next.

You’re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

Time now for the politics out there.

Jesse Jackson, who has been low-key of late, reverted to the old

firebrand yesterday, saying that his candidate, Barack Obama, is—quote -

“acting like he’s white.”  Jackson doesn’t like the fact, apparently, that the Illinois senator isn’t down in Jena, Louisiana, with him and Al Sharpton protesting the arrest of several black juveniles for attempted murder.

Rudy Giuliani is in London today, raising money from overseas Americans and hanging out with Tony Blair in London and, who else, Gordon Brown.  Who says politics stops at the water’s edge?

And more bad news for President Bush and Congress:  A new Reuters poll has their approval ratings at a new low.  Just 29 percent give the president a positive grade for his job performance, 29 percent for Bush—catch this -- 11 percent for Congress.

Congress’ problem is that it’s getting whacked from both parties, the Democrats and the Republicans.  Republicans don’t like the Democrats who control Congress.  And the Democrats don’t like the fact that the Democratic Congress can’t end this dreaded war.

Finally, bipartisan?  Mitt Romney, who not long ago was a pro-choice, pro-gay-rights moderate, is now parading himself as a far-right cultural conservative.

(BEGIN VIDEO CLIP, AD)

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(END VIDEO CLIP)

MATTHEWS:  Well, defending traditional marriage, that’s a far cry from the days when he told Massachusetts voters, Mitt Romney did, that he was more pro-gay than Teddy Kennedy.

Coming up next, the HARDBALL debate:  Should Congress mandate the amount of time U.S. soldiers need at home before going back to fight in Iraq?

We will be right back with that hot debate.

(COMMERCIAL BREAK)

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

The Fed rate cut rally continues.  The Dow Jones industrial average gained 76 points, after soaring 336 points yesterday.  The S&P 500 rose nine points, and the Nasdaq climbed almost 15 points.

Stocks were helped by news of a rare decline in consumer prices.  They fell a tenth-of-a-percent last month. 

And, meantime, core inflation, which excludes food and energy, and which the Fed closely watches, was well-contained in August.  It rose just two-tenths-of-a-percent.

More grim news on the housing front, though:  Housing starts dropped again last month to the lowest level in 12 years.  Meantime, building permits, which forecast future activity, also dropped to the lowest level in 12 years.

And oil closed in New York at a record high for a third straight day. 

Crude finished at $81.93 a barrel, after rising 42 cents.

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

HARDBALL. 

MATTHEWS:  Welcome back to HARDBALL. 

Well, the Democrats have found a way to shift war policy in Iraq. 

Their saying is an amendment by Democratic Senator Jim Webb that would require troops returning from combat in Iraq to get the same amount of rest time at home before they’re redeployed to the battlefield. 

The Senate is debating the bill right now, but the Bush administration says the measure is unconstitutional and would amount to a backdoor troop withdrawal.  Would the Webb amendment protect our troops or cause even greater harm to them on the ground in Iraq?  And should the bill be passed? 

General Wesley Clark is the former NATO supreme allied commander.  He’s also author of a great new book, “A Time to Lead.”  And Pete Hegseth is an Iraq war veteran and executive director of Vets For freedom. 

General Clark, make the case for the Webb amendment. 

WESLEY CLARK, FORMER NATO SUPREME ALLIED COMMANDER:  The case is very simple. 

We have, for over four years, kept our troops deployed or redeploying back and forth to Iraq and Afghanistan.  The number of troops is finite.  They’re limited.  These are the same troops that have been there two, sometimes three times previously.  The families are getting tired.  They need recovery time if we’re going to sustain this into the future. 

I think the Webb amendment is a prudent way of getting that recovery time.  It’s no more than what the Army committed to several years ago, in saying that the troops would have at least a year at home after they had been gone for a year.  And we found we were unable to do it. 

So, this is Congress’ responsibility.  It’s responsible for raising and maintaining an army.  It’s in the Constitution, and Congress is asserting its authority.  I think it’s time to do it. 

MATTHEWS:  Pete, what’s wrong with this amendment to give the troops time at home equal to the time they are serving on their tours, so that they go back rested and ready for battle? 

PETE HEGSETH, EXECUTIVE DIRECTOR, VETS FOR FREEDOM:  Well, it’s just another example of Congress trying to legislate strategy in Iraq. 

You have got generals, all the way up to Secretary Gates, General Petraeus, General Pace, and others, have all said this would do great damage to the Army and the military’s ability to deploy—deploy troops, if necessary, to different areas for emergencies or for just natural troop rotations. 

When the leadership of your military is saying this is something that will not only hurt our rotations, but put troops at risk—if you read what Secretary Gates said the other day in a letter, he said, this amendment will put our troops at risk, because it will not give our commanders an opportunity to deploy them in the way we may need to in a dynamic war environment. 

MATTHEWS:  General?

CLARK:  Well, I think they would be more likely to be deployable in a dynamic war environment if you had a reserve of troops that was prepared and well-rested and ready to go. 

They can always be bought—brought back to Iraq in a tactical emergency, if that’s necessary.  The fact is that, when they’re there in Iraq, they’re continuously in combat.  The units are wearing down.  The equipment is wearing down.  And, if we’re going to have an effective force, we need to have it rested, ready to go and able to sustain for the long term.  This is a force that’s—that’s wearing down rapidly.  It needs recovery time. 

HEGSETH:  Well, there’s no doubt it’s—it’s a difficult situation for the men and—men and women over there.  But you—it’s oversimplifying the problem—oversimplifying the solution to something. 

What you have got right now is, you have got a one-for-one ratio that Congress is trying to legislate, that, when you bring troops over there, you can bring them back and have them stay the exact amount of time that they were in Iraq. 

But the thing is, is, units do not deploy back—and you know this, General—units do not deploy back and then stay together.  The units come and the soldiers disperse into other units.  And when other units are then asked to mobilize and deploy, a lot of the new soldiers in those units will not be able to go, and you will break up the cohesion of units that are heading into a war zone. 

And, if there’s one thing I know we need—and I know this from firsthand experience—it’s platoons and companies that trust each other, that have trained together, and had the cohesiveness necessary to deal with a very difficult environment.  And this amendment oversimplifies troop deployment. 

(CROSSTALK)

MATTHEWS:  Let me ask—let me go to the general, because I know he has a policy, a view on this whole war in Iraq.

Is this a way of opposing the president’s policy on the war, in other words, of restricting his ability to prosecute his view of how we should protect our national defense? 

CLARK:  Well, it does, in some way, restrict the president’s ability to continue to put forces in there, at the expense of the long-term health of the armed forces. 

But the president always has the option of creating more forces.  If it’s that urgent, let’s get those forces built up.  The president has not chosen to do this, even though a number of Democrats have called for him to do this and called for an increase in the size of the armed forces. 

MATTHEWS:  Well, why—let me ask you, Pete, a larger question.  Why don’t we have a military capable of meeting the foreign policy objectives of the current administration?  We have a very aggressive foreign policy under way in this administration. 

We all know it’s forward-leaning.  It’s aggressive.  It’s get them there before they get us here. 

Why don’t we have a military establishment that’s built to meet that mission? 

(CROSSTALK)

MATTHEWS:  Why do we keep trying to meet a new kind of aggressive, neoconservative mission, whatever you want to call it, with a traditional army force?

CLARK:  It’s a great question. 

HEGSETH:  Well, I mean, we have...

CLARK:  It’s a great question, Chris. 

HEGSETH:  We have...

(CROSSTALK)

CLARK:  And what’s happened is, this administration has tried to do this mission on the cheap from the get-go.  They did not plan it adequately.  They didn’t put enough troops in at the outset.  The troops weren’t prepared...

HEGSETH:  General, but...

CLARK:  ... didn’t have the equipment to protect themselves.  And they now don’t have a large enough military to do the kind of aggressive foreign policy mission that they’re seeking to use it for. 

HEGSETH:  General, they have planned to increase the size of the military 92,000 troops. 

But I agree.  We do need more men and women in uniform to execute... 

(CROSSTALK)

MATTHEWS:  Let me go—Pete, you speak for the troops, all right? 

That’s what you’re doing here, right? 

HEGSETH:  That’s what our organization...

(CROSSTALK)

MATTHEWS:  Do you find—do you think, if this were ever passed and signed by the president, this requirement that troops get a full rotation home, a year home, a year on, like police sometimes do, an hour on, an hour off, OK, you think they wouldn’t like it? 

HEGSETH:  No.  It’s not about...

(CROSSTALK)

MATTHEWS:  They—no, wouldn’t—just answer the question.  Wouldn’t they like to be able to get home for the amount of time they’re spending over there?

HEGSETH:  Everybody wants to be home as long as they can. 

MATTHEWS:  Well, then they would like this. 

HEGSETH:  Sure.

MATTHEWS:  So, who doesn’t like this?

HEGSETH:  It’s about doing what’s right, not what you like.  If—this feels good in your heart, but you have got to think about how it works in your head.

MATTHEWS:  No.  I’m asking...

(CROSSTALK)

MATTHEWS:  Who are you speaking for, if not the troops? 

HEGSETH:  Well, I’m speaking for myself and for Iraq and Afghanistan veteran who want to complete the mission.  And they want policies from their generals and from their leadership that allow them to do so.  Chris, they don’t need Congress deciding—general, excuse me—they don’t need Congress deciding how we should deploy troops.  They need generals doing that.

(CROSS TALK)

CLARK:  If you’re speaking for the troops, you’ll hear the troops that come to me in e-mails and many other ways, they need time to recover.  They’re as patriotic and committed as they can be.  But this is an argument between Congress and the administration.  The administration tries to say Congress has no role.  Congress has a very important role to raise and maintain an army.  Congress is asserting its authority under the constitution.  I say it’s high time it did so. 

HEGSETH:  General, you say this is an argument between the administration and the Congress.  This is an argument that needs to be made by the generals, by the leadership of the military that deploys troops.  With all due respect, sir, you’re speaking with a political hat and not thinking about -- 

CLARK:  No, I’m speaking as a strategist who is looking at the long-term needs of the armed forces.  I know this, the most critical asset we have—just a second.  I gave you a chance.  You give me a chance. 

HEGSETH:  Yes, sir. 

CLARK:  I’m speaking as someone who’s looking at the long-term health of the armed forces.  It takes a long time to bring the right people in and train them the right way.  They’re family people.  They and their families need a chance to have as normal a life as possible while this country’s going to war.  The president hasn’t asked for a draft.  He hasn’t asked for taxes.  He hasn’t asked the American people to sacrifice. 

All the burdens coming on the men and women in uniform.  I think the least he can do is get enough people in uniform to give them a decent break when they’re back here.  Let’s face it, the surge hasn’t worked.  It hasn’t brought the political relief.  It’s time we recognize it and start thinking about the long-term health of the armed forces.  That’s why the Webb amendment is a very timely idea.  It’s the right idea, and I hope Congress will pass it tonight. 

MATTHEWS:  OK, thank you very much General Wesley Clark and Pete Hegseth.  Thank you, sir, for joining us. 

Up next, we’re going to argue the biggest stories of the day with our HARDBALL panel tonight.  They’re all coming here to talk about O.J. and, of course, this war and this Webb amendment, and, of course, what’s going on in the Hillary Clinton campaign.  There’s a problem here of lobbyists apparently in match making sessions that she’s putting together to teach them how to lobby.  Do lobbyists really need help to lobby?  This is HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Tonight’s round table, the “Atlantic Magazine’s” Ross Douthat, Salon.com editor Joan Walsh and “Congressional Quarterly’s” Jonathan Allen.  Joan, this O.J. story again—

I covered it for over a year.  This guy looks like he’s facing enough time now to meet all of the demands of those who thought he got away with murder the last time.  This is the weirdest story.  We knew the last one was about a double murder.  This is about a crime that from his perspective never even occurred, let alone he didn’t do it. 

JOAN WALSH, SALON.COM:  Right.  Chris, you know, I understand why we’re paying attention today.  He’s in a courtroom again.  He’s facing serious charges.  He really could conceivably go away for all that time.  But this is not O.J. three.  This is not the story it once was.  It’s not a double murder.  It’s not about domestic violence.  It’s not about race.  It’s not about the LAPD and black people.  It’s about tawdry guys. 

MATTHEWS:  Let’s hope it stays that way.  It doesn’t become a big tribal issue in this country. 

WALSH:  I’m hoping it won’t. 

MATTHEWS:  Everything has to be an ethnic issue.  Do you think it will escape that and then we’ll move on?  Jonathan, will this stay a local criminal case. 

JONATHAN ALLEN, “CONGRESSIONAL QUARTERLY”:  No. 

MATTHEWS:  Will Sharpton get involved?  Will everybody get involved and turn this into a Johnny Cochran event. 

ALLEN:  I think there’s a level at which folks will stay away from O.J. Simpson.  At this point he’s pretty radioactive.  The more folks—

MATTHEWS:  It won’t be a group versus group issue. 

ALLEN:  I think much less so.  At this point, you risk your own credibility. 

(CROSS TALK)

MATTHEWS:  Couldn’t be any more so than it was last time around. 

ALLEN:  No, it couldn’t. 

MATTHEWS:  We will change the subject if you agree, Ross, this is not going to be a big issue, in terms of America, who we are as a country kind of question, where we are in celebrity sex and race. 

ROSS DOUTHAT, “THE ATLANTIC”:  I’m with the rest of the panel.  I also think you have to look at the context of O.J. one.  It was the mid ‘90s.  The country was at peace.  It was a time when people were focused on something like a heinous double murder in Los Angeles.  Whereas now, the country’s at war.  You have a presidential election, and, as Joan said, this is not a double murder.  O.J.’s a punch line, to my generation at least. 

MATTHEWS:  What does that mean? 

DOUTHAT:  It means that he’s in the same category—it’s ridiculous in a way.  Obviously he did probably kill two people in.  But he’s in the same category as the Paris Hiltons and the Nicole Richie’s.  There goes O.J. again.  There goes—

MATTHEWS:  He’s just a cartoon character. 

DOUTHAT:  He’s someone for the gossip blogs. 

ALLEN:  But this is going to stay in the news.  You mentioned Nicole Richie.

MATTHEWS:  It may not stay on this show, but it will be in the news.  Let me tell you, this is a case that it is as big as the Lindbergh kidnapping was back in the ‘40s because it involves everything.  How often does a major celebrity, one of the greatest athletes ever, get convicted or not of murder.  And then face permanent imprisonment on an armed robbery case.  I mean, this is unusual. 

ALLEN:  From his perspective, this is life’s getting a lot better. 

Look where he was ten years ago. 

MATTHEWS:  You know what I think?  I think he’s Nixonian.  I think he likes the weird, weird masochistic nature of all this attention. 

WALSH:  He clearly does. 

MATTHEWS:  Which is really weird.  Let me go to the serious question of politics right now.  For the first time, one of the candidates is actually trying to rip the scab off Hillary Clinton’s establishment power.  What do you make of the fact that Joe Trippi, one of the real wild men in politics, and I say that kindly, was out there the other day nailing Hillary for holding one of these awful—talk about the Keating Five. 

Here’s a meeting in Washington with a bunch of Congress people, including apparently Sheila Jackson Lee, who escaped the chance to be on the show tonight, all sitting around being introduced to a bunch of lobbyists, who are trying to sell security equipment to the federal government.  It’s a match making operation, a pimping operation.  Hillary Clinton is the queen bee of it. 

Is this the future if she gets elected president? 

WALSH:  I don’t know if it’s the future.  I think this should be a warning to her.  I think, you know, Joe is known for strong language.  He called this corrupt.  But I think that’s the defensible thing to call it.  I think she’s vulnerable on all of the old associations and the new associations around fund-raising that just doesn’t look quite right.  So I think she—I think they landed a punch.  I don’t think it’s unfair.  And I think she really needs to be more careful about the company she keeps and the lobby—

MATTHEWS:  And the million bucks she took from this guy Hsu, who is a fugitive now.  It just looks like you’re out there shoveling for money.  You’ll meet with lobbyists.  In other words, she seems to be saying—I hate the word—cynically saying, whatever works. 

WALSH:  Whatever works and I’m above it, and I’m the front-runner.  You can try—She’s making this pitch, you can trust me.  These are just normal Americans with interests, she’s said.  She’s really kind of holier than thou on this, and some people may trust her.  But lots of others won’t.  I think this issue could stick. 

DOUTHAT:  I just wonder—and I agree with everything Joan said basically.  But I wonder if this is the kind of issue that voters really care about.  I mean, when you look back -- 

MATTHEWS:  You know what I think? 

DOUTHAT:  What do you think, Chris?

MATTHEWS:  They don’t like sleaze.  And they don’t like the fact that this government’s being owned by the Halliburtons of this world and that the Democrats can’t clean—keep the money out of their pocket.  Look, they know what the worst is.  You know what the worst thing you can say to a journalist is, you guys like those politicians.  You hang out with them.  Whenever they say you’re too tough on these guys, they say keep it up. 

We’ll be right back with the round table.  You’re watching it,

HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  We’re back with Ross Douthat, Joan Walsh and Jonathan.  Joan, we just got word that late this afternoon, the U.S. Senate has failed to bring that up issue of trying to limit the troop rotation, saying that the troops that fight in Iraq have to take a year off if they’re serving a year, then another year off for another tour.  You got a back and forth between home leave and actual fighting in the combat zone.  That has failed to get the requisite 60 votes.  It looks like not enough Republicans are going to join it.  I don’t see how the Democrats stop this war.  That was their last gasp.

WALSH:  I don’t see how either.  I thin it’s really disturbing.  You did such great coverage of the Petraeus hearings last week, and, you know, came—zeroed in on the fact that he could never tell us that the war made us safer.  He could never tell us that we could win the war.  But he could also never tell us when the troops were coming home.  I there that the country watched that and the country did not have its mind changed. 

All the polls show people still want the troops to come home.  Yet,

the Republicans, some of whom, as you recall, talked very tough to General

Petraeus, cannot get it together to challenge the Bush administration on

any of this.  So the Democrats are left alone trying to fight, trying to

attach time lines. 

MATTHEWS:  Here’s what I hear.  Jack Murtha reported last night—

Jack Murtha knows a lot of members on the other side of the aisle.  He’s rather popular within the cloak room.  He says, Ross, that a lot of Republicans are acting very hawkish now.  They’re not going to go with any anti-war provision of any kind until after their primaries are over with next spring.  Then they are going to start acting. 

In other words, they are playing very safe with their right wing—their very hawkish bases.  Does that sound right?  Maybe that’s pie in the sky.  The Democrats are hoping at some point the Republicans will join them on this thing. 

DOUTHAT:  It seems politically plausible to me.  I think the central dynamic to understand in the Republican party is that you have 25 percent of the country, basically the core of the Republican base, who very strongly support the war, and believe that victory is obtainable in Iraq.  Therefore, they support the surge and so on.  And these are the people who the Republican presidential candidates are playing too when they talk tough on the war, and these are the people that Republican senators are worried about. 

And it’s true.  If you look at the reaction in the conservative media and in the conservative base to those Republican senator who have sort of gone off the reservation a little bit on Iraq, they’ve been attacked.  And I think politically it does sort of make sense.  But the other thing is that—I mean what Joan said is true.  You have heard for years almost now Republicans talking about, well, in six months, you know, we’re going to break with the president, and now another six months. 

MATTHEWS:  The Republican party, to be blunt about it, is willing to get down with the ship, it looks like. 

ALLEN:  I don’t think they’re going to go down with the ship entirely.  It’s not just plausible what Murtha said, it’s dead on.  If you talk to Republican Congressmen, they will tell you quietly, and in some cases with their names attached to it, that they’re waiting for the primary.  They have got to get out of their base, get past that, and then switch during the general election.  Talked to a Congressman from Indiana that was talking about that a couple months ago.  You’ll see it with the Senate Republicans, the big-time Senate Republicans in swing districts. 

MATTHEWS:  So next year around June, they’re going to start being dovish. 

ALLEN:  That’s exactly right. 

WALSH:  And how many more. 

ALLEN:  Get to the primary, they’ll start moving. 

WALSH:  How many more soldiers die while they wait. 

MATTHEWS:  We know now 60 to 90 a month is the projection.  It was given by General Petraeus to Lindsay Graham.  It’s almost like we’re getting European.  It used to be in America we thought, hopefully, we’d get through a war with few casualties.  Now, we’re doing it like Europeans.  You’re assuming a certain level of casualties that come with warfare.  We’re no luckier than any other country.  Maybe it’s growing up, Joan, but we now realize that we stay in this war six more months, do the multiplication.  Six times 90; 550 some people are going to be dead. 

WALSH:  I think it’s tragic. 

MATTHEWS:  The country—the country as a majority is opposed to this war.  But you’re pointing out, Ross, that as long as a core base of the president’s party supports this war, and as long as he has the commander in chief role, as constitutional leader of the country, even a majority can’t end the war. 

DOUTHAT:  And part of it—one dynamic at work here too that’s different from Vietnam is you’re dealing with an all-volunteer army.  It’s a smaller force than in Vietnam.  And it just has—the stress of war leaves a smaller cultural imprint.  What that means is that even if 60 percent of the country is technically in favor of withdrawal, those 60 percent are not as deeply invested in withdrawing as a majority might have been in Vietnam. 

MATTHEWS:  Let me ask it to Joan.  Now that we have just learned the Senate has failed to reach the number of votes they need to bring up this matter of limiting the rotation of officers and troops going back and forth to Iraq in a way of sort of back during an end to the war, is that the last hope? 

ALLEN:  I think for the Democratic perspective, for folks who want to end the war, it absolutely is, at least for the time being. 

MATTHEWS:  This is the end of the game.  The president has won it.  Match point.  Any way, thank you very much, Joan Walsh, Ross Douthat, and Jonathan Allen.  Join us again tomorrow night at 5:00 and 7:00 Eastern for more HARDBALL.  Right now it’s time for “TUCKER.”

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