updated 11/14/2007 2:33:06 PM ET 2007-11-14T19:33:06

Guests: Joe Klein, Ed Rollins, David O‘Steen, Julie Mason

CHRIS MATTHEWS, HOST:  Who‘s afraid of the big bad wolf?  First the Clinton people blamed the moderator in that Philadelphia debate for Hillary‘s bad night.  Then they confessed to feeding questions in televised town meetings.  Now they‘re trying to intimidate the next debate moderator.  Is everyone fair game except the candidate?

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  Welcome to HARDBALL, tonight from Los Angeles, where I‘m speaking at the Richard Nixon presidential library.  Just weeks ago, most political observers agreed that Hillary Clinton was the inevitable Democratic nominee for president.  In fact, most thought she had the best chance of being elected president in 2008.  It‘s still the best bet out there, and yet her armor of invincibility has been seriously pierced.

First she fumbled her performance at that Philly debate.  Then her workers in Hillary-land came out and tried to blame the moderator.  When critics brought up her flawed response on illegal aliens getting driver‘s licenses, Bill Clinton accused them of Swift Boating Hillary and went on to say the boys are ganging up on her—the boys.  And just this week, we find out her campaign is putting ringers out there at events to toss her softballs.  Talk about a reversal of fortunes!

Is this a well run, well managed campaign?  What is going on inside that Hillary Clinton campaign?  And who‘s calling the shots?  How‘s Hillary going to come back and win over the hearts and minds in the Democratic Party?

In a moment, we‘ll talk to two of the best in the business about bad moves in the Clinton campaign and the heating-up battle to beat Rudy on the other campaign.  Fred Thompson won the endorsement today of the National Right to Life Committee.  We‘ll talk to the executive director of that committee and ask him why he endorsed a candidate who‘s against a constitutional amendment to ban abortions.

But we begin tonight with “Time” magazine‘s Joe Klein, who wrote this week‘s cover story about Hillary Clinton, and Republican strategist Ed Rollins.

I‘ve got to go to you, Joe.  You wrote the big piece on Hillary. 

What‘s going on in the campaign with all this sort of rocky behavior?

JOE KLEIN, “TIME” MAGAZINE:  I don‘t know that there‘s all this rocky behavior going on.  I think that the narrative in the press has changed.  A few weeks ago, there was the notion that she was invincible, which I always thought was nonsense.  And now there‘s the notion that she stumbled, which may be equally nonsensical.

You have vast numbers of people in Iowa—and Chris, you know how this works.  They don‘t like making up their minds until the very last minute.  I‘ve always believed that at some point, there‘s going to be a gut-level, visceral decision about whether people want Hillary Clinton in their living rooms for the next four years.  That decision hasn‘t been made yet.  And I don‘t think it‘s going to be made on the basis of whether she‘s planting questions in audiences because, I got to tell you, everybody does that.  And...

MATTHEWS:  Who else does it?

KLEIN:  Oh, I remember in 2004, I bumped into a woman at a—who asked the first question at a Kerry town meeting, who did it.  Obviously, Bush does it with every last question during his town meetings.  But it‘s just not unusual.

You know, and the fact is, she does take tough questions from her audiences.  I‘ve traveled around Iowa with her and I‘ve seen her having to field them.  I mean, if we‘re going to talk about the substance of the campaign, then—you know, then that‘s one thing.  But these other issues I think are ways that we‘re trying to...

MATTHEWS:  Well, let‘s go...

KLEIN:  ... inject into the...

MATTHEWS:  Let‘s go through them.

KLEIN:  ... into the—you know, inject our own problems or our own desires...

MATTHEWS:  Sure.

KLEIN:  ... into a process that most people aren‘t buying into.

MATTHEWS:  You‘re on this show to express your will and your views and your perspective.  You‘ve been out there.  Let me ask you, Joe, a couple of things.  Do you think that Bill Clinton is playing a correct, smart political role in this—let‘s take a look at his latest comment the other day.

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES:  It‘s a great time to be a Democrat.  And I like it—I like it because even though those boys have been getting kind of tough on her lately, she can handle it.

(END VIDEO CLIP)

MATTHEWS:  Well, what do you make of that, and then the campaign putting out the word that “those boys” didn‘t refer to boys?

KLEIN:  That‘s the way Southerners talk, I think.  I mean...

(CROSSTALK)

MATTHEWS:  ... refer to girls?

KLEIN:  No, he...

(CROSSTALK)

MATTHEWS:  ... refer to boys.

KLEIN:  He was saying that—you know, “those boys” is the way Southerners say “those guys.”

MATTHEWS:  Yes, I know.

KLEIN:  You know, it‘s just not a big deal, I don‘t think.  I do think that there are some big deals here.  I think that Hillary Clinton‘s vote on the Iran resolution is a big deal.  But I don‘t think that this other—I think all this other stuff is background noise.  And when I talk to voters in Iowa, that‘s the impression I get.

MATTHEWS:  So you don‘t get the idea that this campaign is being too tightly micromanaged to avoid any kind of spontaneity?  You don‘t see that?

KLEIN:  No, I think she‘s actually more spontaneous than I‘ve seen her in the past.  She certainly has been with me.

MATTHEWS:  OK.  Let‘s go to Ed Rollins.  Your views—let‘s go through all of these matters.  Joe says they‘re inconsequential politically.  Maybe they are.  Let‘s take a look at this.  Coming out of the debate the other night in Philadelphia, somebody top in the campaign started blaming the moderator.  Then they started blaming the other candidates.  And then they blamed Swift Boating.  And then we had this little question about—well, this whole thing of maybe they‘re trying to play the gender card.  What do you think, Ed?

ED ROLLINS, REPUBLICAN STRATEGIST:  Well, first of all, they need combat.  The problem is this thing has gone on for so long.  They‘ve had a very practiced, very disciplined campaign, and it‘s like having too many exhibition games.  They need to get to combat.  Combat starts in 50 days in Iowa.  Once they start winning some races and doing some things that they need to do to—you know, they‘ll be OK.  She had a bad debate.  There‘s no question about it.  She got caught up in the Spitzer big mistake in New York.  And I think, to a certain extent, that hurt her.

I think the biggest mistake now is her husband playing a public role.  Her husband‘s a brilliant strategist, but by comparison, she can never be as good as he is, and I think he needs to be behind the scenes.  He needs to appear in public as often as Mrs. McCain does, which is very little.  And I think, to a certain extent, he can give all the advice he wants, but at the end of the day, he needs to be behind the scenes, not out front.

MATTHEWS:  Let‘s take a look at a new slogan apparently being released out from the Clinton campaign.  Here it is.  She released it on Saturday night.

(BEGIN VIDEO CLIP)

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE:  So when the Republicans cut Head Start and refuse to fix No Child Left Behind, what do we do?

UNIDENTIFIED FEMALE:  Turn up the heat~!

UNIDENTIFIED MALE:  Turn up the heat~!

UNIDENTIFIED FEMALE:  Turn up the heat~!

CLINTON:  And when we Democrats fight for universal care and the Republicans veto health care for children and let the insurance companies and the drug companies undermine health care for the rest of us, what do we do?

UNIDENTIFIED MALE:  Turn up the heat~!

UNIDENTIFIED FEMALE:  Turn up the heat~!

UNIDENTIFIED MALE:  Turn up the heat~!

(END VIDEO CLIP)

MATTHEWS:  Joe, would you think that would be Hillary back in her groove, then?

KLEIN:  No, I don‘t.  I think that she‘s quite clearly not a very good big room speaker.  And let me just say that the campaign‘s reaction after that debate by using the gender card wasn‘t extremely wise.  But one thing that I am finding when I talk to people in Iowa is that the fact that she‘s a woman does play a major role for good and ill in this campaign.

You know, one thing that you hear about Bill Clinton constantly from men who support Hillary—Why do you support Hillary?  Because he‘ll be there and he was a really good president.  You don‘t hear that from the women on the trail.  So clearly, gender is a huge issue, bigger than we make it out to be maybe.

MATTHEWS:  What do you make of the role the former president is playing here, Ed Rollins, whereby he seems to come in almost like a lifeline or a big footer, who comes in and says, Now, you take care to be nice to the little woman?  I mean, I hear that.  He‘s doing it.  Should he not do that?

ROLLINS:  No, he should not do that.  I mean, the bottom line is she‘s a United States senator.  She‘s been there for seven years.  She‘s a frontrunner for president.  She doesn‘t need him.  And the argument that I think could be made is every time he steps in and sort of referees or protects her, is that she‘s not strong enough to do the job herself.  And I think that‘s a subtle message but an important message.  She‘s got to go out and win this thing.  She‘s got to be a strong candidate from now until November.  She‘s going to be in a very, very tough campaign, whoever the Republican may be, and she just better be prepared to go it alone.

MATTHEWS:  Joe, I think there‘s been a change in her tactics.  A couple weeks ago—maybe it‘s three or four weeks ago—I was raving about how well she handled the Chicago debate.  I said when she came out there and said, If you want a fighter, I‘m your girl, she was ready to take on the whole mob of the guys against her, and she was looking very good.  A lot of guys, you know, you and me probably both, love it when a woman says she‘s tough enough to take on the boys.  It‘s sort of like Cat Ballou, you know?  I‘m going to take them down.  And yet somehow, during this last skirmish, she came out looking for excuses.  I think there‘s been a difference.

KLEIN:  I think she had a bad night.  I think it was the first time, and she, you know, said to me when I interviewed her that, you know, she wasn‘t as artful as she could have been.  But I don‘t know—you know, the other thing that I might say—and I know it was an MSNBC debate, but I couldn‘t find anybody in Iowa, even the political junkies who go to her meetings, who actually saw the debate.  They saw sound bites afterwards.

MATTHEWS:  Yes.

KLEIN:  But I think we make a mistake if we...

MATTHEWS:  Yes.

KLEIN:  ... disproportionately react to one debate.

MATTHEWS:  Joe, nobody saw the Ted Kennedy interview with Roger Mudd because “Jaws” was premiering on television opposite it, but everybody remembers seeing it.

KLEIN:  But this doesn‘t compare to that.

MATTHEWS:  Well, I just wonder why...

KLEIN:  This was a clumsy, bad night that she had, but it wasn‘t like Ted Kennedy not being able to answer why he didn‘t...

MATTHEWS:  Well, what is—OK...

KLEIN:  ... why he wanted to run for president.

MATTHEWS:  OK, that one...

KLEIN:  That went to the heart of the campaign.

MATTHEWS:  Does she believe we should give documents to people in the country illegally?  I‘m not sure she‘s said that clearly yet.

KLEIN:  No, she...

(CROSSTALK)

MATTHEWS:  ... she sympathizes with governors like Governor Spitzer. 

Does she believe that‘s good public policy?

KLEIN:  In fact, she was supporting what I thought was a chuckle-headed public policy on the part of Governor Spitzer.  But then John Edwards used those exact same words...

MATTHEWS:  But you wrote in your piece that the only guy that was straight on this was Dodd, who said, Don‘t do it.

KLEIN:  That‘s exactly right.

MATTHEWS:  Well, what is the right position politically going down to next November?

KLEIN:  It‘s not a question of—I mean, first of all, it‘s ridiculous because there is no illegal alien who is going to come forward...

MATTHEWS:  And you make that point in your piece.

KLEIN:  ... and get a driver‘s license so they...

MATTHEWS:  So why are there...

(CROSSTALK)

MATTHEWS:  That can‘t be true, Joe, because the representatives in the state legislature In Albany are pushing like hell for this.  They want those documents.  And by the way, what they wanted originally was not just an ID—a driver‘s license, they wanted an ID card they could use for all purposes.

KLEIN:  Hey, Chris, the appearance of action in legislatures, state legislatures...

MATTHEWS:  Right.

KLEIN:  ... and especially Congress...

MATTHEWS:  OK...

KLEIN:  ... is about the best you can get these days.  We‘re not getting very...

MATTHEWS:  OK...

KLEIN:  ... much substance from legislatures.

MATTHEWS:  OK.  Ed Rollins, will she have to change her position on that to the clear position of opposing giving legal documents to people in the country illegally?

ROLLINS:  I think she does.  But the problem is that she‘s starting to look like her husband did when he was running before.  He was known as a panderer.  Bill Clinton always wanted to be loved by all sides.  One of the arguments about Hillary is that she has a core of beliefs and she‘s going to stick to them.  I think worse than the debate was the performance after the debate in which she blamed everybody but herself.  And I think the reality is that she does not have a clear position on this and she‘s pandering, and that basically will make her very weak and very vulnerable.

MATTHEWS:  That‘s what I think.

KLEIN:  I agree with...

MATTHEWS:  Thank you...

KLEIN:  I agree with Ed on that.

MATTHEWS:  I think we all agree.  Ed Rollins and Joe Klein are both coming back.  We‘ll talk about Republicans when we come right back.  The heat is on Rudy.  Something‘s going on out there with the numbers and the positions of these candidates.  Their performances are getting hotter and hotter.  They are turning up the heat.  We‘ll be right back.

And also, we‘re going to have the “Big Number” tonight.  Every night, I‘m going to give you a vital number.  We‘re calling it the “Big Number” that you can take away from the show, a little tchotchke to make whatever use you want of.  Tonight, the HARDBALL “Big Number” is $1.2 trillion.  According to the Democratic staff of the Congressional Joint Economic Committee, that‘s the total cost to America of the war we began in Iraq four years ago.

It‘s important to remember, by the way, the top people in the Bush administration made a big point to undersell the cost of the war before we got in and to oversell the economic benefits.  Paul Wolfowitz, the deputy defense secretary, testified before Congress that the bulk of rebuilding Iraq would be paid for by Iraqi oil, not by us.  Larry Lindsey, the president‘s chief economist—that‘s Bush‘s chief economist—said our invasion and occupation of Iraq would actually increase the supply of oil in the world and thereby—catch this—cut the cost of gasoline at the pump.  Promises, promises, $1.2 trillion, the American cost of the Iraq war so far.  That‘s tonight‘s “Big Number.”

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Rudy Giuliani leads national polls for the Republican nomination for president next year, but there‘s a real battle to take him on now.  Can Mitt Romney do it?  What about Fred Thompson?

HARDBALL‘s David Shuster has tonight‘s report.

(BEGIN VIDEOTAPE)

DAVID SHUSTER, HARDBALL CORRESPONDENT (voice-over):  Just 51 days until the 2008 voting begins, and today the intensity of the Republican presidential battle took center stage.  Fred Thompson campaigned in South Carolina but picked up an potent endorsement in Washington, D.C., from the National Right to Life Committee.

DAVID O‘STEEN, NATIONAL RIGHT TO LIFE COMMITTEE:  We look at the stands he takes on life.  And we look at the fact that while there are various polls, and some are up and down, the overwhelming consensus has been that he is best positioned to top pro-abortion candidate Rudy Giuliani for the Republican nomination.

SHUSTER:  The anti-abortion group usually gives a lot of money and organizational help to the presidential candidate it endorses, and this could be particularly helpful to Thompson, who needs a boost.  The GOP frontrunner in the early caucus and primary states is Mitt Romney.

MITT ROMNEY (R-MA), PRESIDENTIAL CANDIDATE:  What a thrill to see so many friends here!

SHUSTER:  On Friday, John McCain‘s mother brought up the scandal-plagued Salt Lake City Olympic Committee and robbed (ph) Romney of his star quality.

ROBERT MCCAIN, JOHN MCCAIN‘S MOTHER:  And as far as this Salt Lake City thing, he‘s a Mormon, and the Mormons of Salt Lake City caused that scandal.  And to clean that up, I—it‘s—there‘s not even—again, it‘s not a subject.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE:  The views of my mother are not necessarily the views of mine.

(LAUGHTER)

SHUSTER:  Here is Romney‘s reaction.

ROMNEY:  Mrs. McCain‘s comments?  You know, I give a pass to anybody that‘s over 90.  They can say whatever the heck they want.

SHUSTER:  Romney appears to be spending whatever he wants on television ads.  The latest records show Romney has already burned through $10 million for TV ad placements this year.  It‘s a record amount for this point in a campaign, and all of the money has been spent in Iowa, New Hampshire and South Carolina.

No television commercial in Iowa, though, is generating as much heat as the one just unveiled by Republican Tom Tancredo, a border control fanatic.

UNIDENTIFIED MALE:  There are consequences to open borders beyond the 20 million aliens who‘ve come to take our jobs.  Islamic terrorists now freely roam U.S. soil, jihadists who throb (ph) with hate, here to...

SHUSTER:  The ad is graphic and dramatic.

UNIDENTIFIED MALE:  ... the price we pay for spineless politicians who refuse to defend our borders against those who come to kill.

SHUSTER:  Rudy Giuliani, the Republican who‘s actually been confronted with terrorism, has yet to run a single television campaign ad promoting his candidacy in Iowa or New Hampshire.  Giuliani is behind in both states, and his campaign is divided over whether or not to hold off and spend all of his campaign ad money in Florida, New York, California and other blockbuster delegate states.

(on camera):  Giuliani‘s campaign insists he could still win the nomination, even if he doesn‘t get a single victory in the early states of Iowa, New Hampshire or South Carolina.  But that hasn‘t happened in 30 years.  And even Fred Thompson‘s campaign, which got the big endorsement today, says any candidate is going to need at least one victory early on.

I‘m David Shuster for HARDBALL in Washington.

(END VIDEOTAPE)

MATTHEWS:  Thank you, David.  We‘re back with Republican campaign consultant Ed Rollins and “Time” magazine‘s Joe Klein.  Gentlemen, I‘ve had weeks of believing that Rudy Giuliani can win because he can win the big states along the East Coast and the West Coast because they have unit rule in most cases, winner take all.  He can take early losses and still sweep in Florida, New York, New Jersey, Connecticut, California, whatever, Illinois.  Is that still a credible belief, Joe?

KLEIN:  Yes.  Absolutely, I think it‘s a credible belief.  You know, I‘m—but there seems to be some confusion in the Giuliani campaign.  I mean, I think he‘s going to be in Iowa tomorrow.  What‘s he doing there?  I think that at this point, Iowa is a far more important contest on the Democratic side than it is on the Republican side, unless you are looking to who‘s going to finish second and third to Mitt Romney.  Romney is way ahead there, I think.

MATTHEWS:  What do you think, Ed?  Can he survive losing a couple of early ones, in fact, maybe two or three early ones, but still sweep those big states with the unit rule?

ROLLINS:  I don‘t know.  You know, the bottom line—first of all, California doesn‘t have the unit rule.  California is...

(CROSSTALK)

MATTHEWS:  Well, it has it by C.D., OK.

ROLLINS:  It‘s C.D.

The bottom line is, we don‘t know what those three weeks are going to be about.  If you lose everything from January 3, and you go 20, 22 days before you win a delegate, we don‘t know what‘s going to happen.  There may be some momentum.  We have seen it in the past.

The difference is, Romney has $75 million or $100 million of his own money.  He doesn‘t have to go out and basically raise money.  He has money to spend.  And he may be able to get in some of those states and compete pretty effectively. 

Giuliani has been running as a front-runner, an inevitable nominee.  And, clearly, his numbers are not strong enough.  There‘s been a lot of erosion.  I don‘t take anything away from him as a candidate.  But I think the assumption that you‘re going to win because you‘re ahead in polls two or three months in advance don‘t mean a whole lot, and don‘t show the experience that a lot of us have had in those early states, where the momentum catches you by surprise. 

I think their—I think their campaign made a gigantic mistake yesterday by saying, we can win without those early primaries. 

You still need to pay attention to those states.  Otherwise, you‘re guaranteeing...

MATTHEWS:  Right. 

ROLLINS:  ... you are going to get really rejected. 

MATTHEWS:  Right. 

OK, let me go with Joe. 

KLEIN:  He‘s got to play somewhere.

MATTHEWS:  Joe, start. 

What do you think, Joe?  Do you think—I know this is a tough call.  Imagine you‘re the candidate, you‘re Romney, and you are LDS, you‘re Church of Jesus Christ of Latter Day Saints, and you know that‘s a problem in certain parts of the country, not everywhere.  It may be a problem in the evangelical areas of the South, the Bible Belt. 

Would you address that issue directly or hope that you can win on charisma, money, successful campaigning generally? 

KLEIN:  Sooner or later, he‘s going to have to address it, I would imagine.  And it isn‘t all that hard to address. 

I mean, there‘s all kinds of soaring, uplifting rhetoric he could use about how he‘s an American.  But I do believe it‘s going to be a situation, although less of a situation if he wins Iowa and New Hampshire.  He can afford to lose South Carolina in that case, which he may well lose.  That‘s the place where Thompson has to break through, or—or his campaign is toast, although it seems kind of toasty right now. 

MATTHEWS:  Ed, what is the issue, belief or loyalty?  In other words, is it what he believes about God and man or is it where his loyalties lie in terms of church discipline? 

KLEIN:  I think it‘s weird—the issue here is weirdness.  People—the general impression that people who don‘t know about Mormonism have is that it‘s kind of strange. 

I mean, it‘s—it‘s a new religion.  You know, it started in the 1830s. 

MATTHEWS:  Yes. 

KLEIN:  There were visitations by angels 150 years ago and gold tablets and multiple wives. 

ROLLINS:  It‘s—it‘s not...

KLEIN:  That‘s—that kind of stuff has to be answered. 

(CROSSTALK)

MATTHEWS:  Well, can it be, Ed...

(CROSSTALK)

MATTHEWS:  I‘m a Roman Catholic, but I don‘t think people that run for office should have to explain transubstantiation on television or exorcism or anything like that that is in the religion. 

(CROSSTALK)

KLEIN:  Yes, but that was too—that was a long time ago, Chris. 

(LAUGHTER)

MATTHEWS:  No, it happens every day in church, by the way. 

(CROSSTALK)

KLEIN:  The problem is—I‘m not saying that this is a legitimate concern.

What I‘m saying is that the people who are concerned about Mormonism are more concerned about weirdness than anything else. 

MATTHEWS:  All right. 

Do you believe that, Ed? 

ROLLINS:  No, I don‘t. 

I think—I think this is a credible candidate.  I think he‘s gone out and proven himself.  I think there are people who have doubts.  And, unfortunately, many of them may be Republican primary voters. 

But, at the end of the day, I think he‘s a credible candidate.  I think he has tremendous resources.  Every one of these candidates has a flaw. 

MATTHEWS:  Yes. 

ROLLINS:  I mean, the amazing thing to me is—I mean, everyone does. 

I mean, Rudy Giuliani is a guy that you and I would have had a conversation over a bar, Joe, a year ago and said, he doesn‘t have a snowball‘s chance in hell.  He‘s now the front-runner.  We can take each and every one of these. Fred Thompson, we thought, would be a much better candidate than he‘s become.

Mike Huckabee is a guy no one gave a snowballs chance in heck of, and he‘s moving very strongly in Iowa.  So, this is a race unlike anything we have ever seen before.  And I think we‘re going to have to watch it play out.

KLEIN:  No, that‘s right.  And I didn‘t—by—I didn‘t mean to imply that Romney isn‘t a plausible candidate.  In fact, in traditional terms, I would consider him the front-runner at this point, because the national polls really don‘t mean all that much.  The polls in Iowa and New Hampshire, where he‘s substantially ahead, do mean things. 

But Ed is absolutely right.  This is a race that really doesn‘t have a legitimate front-runner.  And—and we have not seen anything like this before, especially from Republicans, who like to sort things out in advance. 

MATTHEWS:  Well, I love doing this. 

(CROSSTALK)

MATTHEWS:  I love having you guys on. 

Last word.  Last word, Ed. 

ROLLINS:  The other part is, we have not—we have seen everybody tell their own story.  We have not seen anybody else telling their story. 

Rudy has got to talk about what he did on 9/11.  There‘s going to be forces out there telling what he didn‘t do.  And every one of these candidates now has to go through the negative process that John McCain found out about in South Carolina in 2000.  And that changes the dynamics dramatically. 

MATTHEWS:  OK, Ed Rollins.

I love being on with the heavyweights.

ROLLINS:  Thank you. 

MATTHEWS:  Ed Rollins, Joe Klein.

Great piece in “TIME” magazine on the cover, Joe.

KLEIN:  Thank you. 

MATTHEWS:  So, who is buying Bill Clinton‘s explanation about the boys ganging up on Hillary?  We will get into that and the rest of what‘s out there politically on the campaign trail.

And, later, can Fred Thompson make headway with conservative voters?  Will it be enough to slow down Rudy with this new Right to Life endorsement?

HARDBALL returns after this. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

So, what else is new out there politically? 

Well, yesterday, Bill Clinton took a shot at Hillary‘s boy problem. 

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES:  It‘s a great time to be a Democrat, and I like it. 

(CHEERING AND APPLAUSE) 

B. CLINTON:  I like it because, even though those boys have been getting kind of tough on her lately, she can handle it. 

(END VIDEO CLIP)

MATTHEWS:  Well, today, the Hillary people are trying to spin the Clinton intervention this way:  Oh, no, the former president is not trying to flash the old gender card.  He‘s not saying that the male candidates are ganging up on the female candidate.  That reference of his to boys, the Hillary people now piously inform us, is Arkansan, Southern for people generally.  Of course it doesn‘t refer to someone‘s gender.

Well, I guess it depends on what your definition of “his” is.

Speaking of Hillary, John Edwards won‘t say he will vote for her even if she does beat him out for the Democratic presidential nomination.  “The New York Times” reports today that Edwards refused to say that even when asked on two occasions if he would back Hillary if she won. 

Senate Democratic Leader Harry Reid said today that Democrats won‘t approve more funding for the war in Iraq if the president doesn‘t agree to start bringing the troops home.  This week, Congress is supposed to vote on a $50 billion war funding measure that does call for the troops‘ withdrawal immediately.

Finally, gay voters have become an important part of the Democratic Party base, and, today, Hillary Clinton picked up one of the most respected politicians in this country, who happens to be gay, Massachusetts Congressman Barney Frank, who chairs the Financial Services Committee of the House of Representatives.

Up next:  Fred Thompson wins the endorsement of the National Right to Life Committee.  Can Thompson be the candidate of the cultural right? 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

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

Stocks rallying on Tuesday, with the Dow Jones industrial average surging some 319 points.  The broad market also saw a 42-point game on the S&P 500.  And tech stocks also leading upward, a 89.5-point gain on the Nasdaq. 

The Dow surged after assurances from top bankers, both at Goldman Sachs and J.P. Morgan, that those firms will face limited fallout from the subprime mortgage mess.  That news offset not-so-positive reports from Morgan Stanley and Bank of America that they are feeling pressures from the mortgage market.

Wal-Mart also did help stocks today.  The nation‘s top retailer raised its fourth-quarter outlook and posted an 8 percent jump in third-quarter earnings.  Wal-Mart boosted its own bottom line in part by making deep discounts, not only on products in stores, but cost cutting internally. 

Oil plunged after a report showed soaring prices are in fact cutting into global demand.  Crude oil fell $3.45 in New York‘s trading session, closing at $91.17 a barrel. 

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

HARDBALL. 

MATTHEWS:  Welcome back to HARDBALL. 

On the heels of Senator Brownback‘s endorsement of John McCain and Pat Robertson‘s support of Rudy Giuliani, the National Right to Life Committee officially today threw its weight behind Republican presidential candidate Fred Thompson.  Can Thompson be the candidate for the pro-life movement and social conservatives generally? 

David O‘Steen is the executive director of the National Right to Life Committee.

Thank you, sir. 

Why did you pick Fred Thompson, rather than John McCain, who is a real lifelong pro-lifer?            

DAVID O‘STEEN, EXECUTIVE DIRECTOR, NATIONAL RIGHT TO LIFE COMMITTEE: 

Well, we examined three things, the candidate‘s position, the candidate‘s record, and their electability. 

And, quite frankly, Senator Thompson scored on all three.  He has got a strong pro-life stand on the issues.  He‘s committed to appointing the kind of judges that would reverse Roe v. Wade, judges that will interpret the Constitution according to their text. 

He‘s voted right down the line on the issues, including—and his stand on embryonic stem cell research is very pro-life.  He opposes the kind of research that would require killing human embryos and supports the kind of research that is producing cures now and wouldn‘t harm anyone.  And he‘s got a record...

MATTHEWS:  Well, how do you stand—but what about his opposition—he was doing—he said this on “Meet the Press” recently, very recently—that he opposes passing a constitutional amendment, amending the Constitution to basically outlaw—let‘s take a look at what he said about the amendment to ban abortion. 

(BEGIN VIDEO CLIP, “MEET THE PRESS”)

TIM RUSSERT, NBC WASHINGTON BUREAU CHIEF:  Could you run as a candidate on that platform, promising a human life amendment banning all abortions? 

FRED THOMPSON, REPUBLICAN PRESIDENTIAL CANDIDATE:  No. 

RUSSERT:  You would not? 

THOMPSON:  No. 

I have always—and that‘s been my position the entire time I have been in politics.  I thought Roe vs. Wade was wrongly decided.  I think this platform originally came out as a response particularly to Roe vs.  Wade because of that. 

Before Roe vs. Wade, states made those decisions.  I think people ought to be free at state and local levels to make decisions that even Fred Thompson disagrees with.  To have an amendment compelling, going back even further than pre-Roe vs. Wade, to have a constitutional amendment to do that, I do think would be the way to go. 

(END VIDEO CLIP)

MATTHEWS:  But doesn‘t—Mr. O‘Steen, doesn‘t a right-to-lifer believe in outlawing abortion, period, not leaving it up to the states, like states‘ rights? 

O‘STEEN:  Well, of course, what—first, let me—I will point out, Fred Thompson has clarified it.  He wouldn‘t try to change the Republican platform. 

But no one can promise a human life amendment in the next term of—the next presidential term.  It would take a change of 25 to 30 votes in the United States Senate.  And that‘s not going to happen. 

The human life amendment has been a goal of the right-to-life amendment, but it‘s a tool.  It‘s a tool to protect unborn children.  What we‘re trying to really do is protect unborn children.

MATTHEWS:  Yes. 

O‘STEEN:  And that‘s going to be done first by reversing Roe v. Wade, by getting the kind of judges that Fred Thompson will appoint.  Now, having...

MATTHEWS:  What is your ultimate goal?  Your ultimate goal, though, as a right-to-life organization is to outlaw abortion in America, isn‘t it? 

O‘STEEN:  Our ultimate goal is to pass laws to protect unborn children. 

But, remember, with a human life amendment or reversing through the court, it‘s going to take enabling state legislation. 

You know, Fred Thompson voted in the Senate against a resolution praising Roe vs. Wade.  He voted against a sense of the Senate resolution.  His support to overturn Roe vs. Wade is clear.  He‘s been there.  He knows that life begins at conception.  He has stated that.  He opposes abortion.

Remember, also, he‘s a conservative.  He‘s a federalist.  And, of course, we have a federal system of government.  And, when he states that people in the states and people, through their legislatures, can pass laws he disagrees with—and notice he said he disagrees with—that‘s just our system of government.  But he‘s a pro-lifer.  He wants to see pro-life laws passed.  And he worked hard in the Senate...

MATTHEWS:  What about—what about Romney?  Romney says he‘s a pro-lifer.  McCain is a pro-lifer. 

Let me ask you about Romney, who is—who is doing so well in the polls in Iowa and New Hampshire.  He may well be the early front-runner when we start actually voting in this country.  Would you support him if he were to win the nomination? 

O‘STEEN:  I don‘t want to get into hypotheticals, because I believe Fred Thompson will win the nomination. 

But let me say this about the early states.  And Fred Thompson is positioned well to win in states like South Carolina and Nevada.  With the compressed primary schedule and essentially a mini national primary February 5, it‘s not clear how—how those early states are going to play in this. 

MATTHEWS:  Yes. 

(CROSSTALK)

MATTHEWS:  I have always wondered something about...

(CROSSTALK)

MATTHEWS:  I have always wondered something about the pro-life movement.  If—if you believe that killing—well, killing a fetus or killing an unborn child is—is murder, why don‘t you bring murder charge or seek a murder penalty against a woman who has an abortion?  Why do you let her off, if you really believe it‘s murder? 

O‘STEEN:  We have never sought criminal penalties against a woman. 

MATTHEWS:  Why not? 

O‘STEEN:  There haven‘t been criminal penalties against a woman.

MATTHEWS:  Well, why not?

O‘STEEN:  Well, you don‘t know the circumstances and how she‘s been forced into this.  And that‘s...

MATTHEWS:  Forced into it? 

(CROSSTALK)

O‘STEEN:  ... to be effective.

We‘re out—we‘re not out—we‘re out to try to protect unborn children.

(CROSSTALK)

MATTHEWS:  See, this is where the hypocrisy comes in, sir.  If it‘s wrong to have an abortion, why don‘t you criminalize it?

(CROSSTALK)

O‘STEEN:  I don‘t think that‘s the way you‘re going to protect unborn children.

(CROSSTALK)

MATTHEWS:  But, if you say it‘s murder, why don‘t you act on that? 

O‘STEEN:  I think civil—I think civil penalties, aiming at the doctors, taking away their financial incentives.  We‘re after what works to protect unborn children.  And that‘s the goal.

MATTHEWS:  But the problem with all the states‘ rights is, you just go to the next state.  And, if you outlaw it in America, you just go to Canada or Mexico or Dominican Republic.

Unless you penalize the person who has an abortion, I don‘t see how you actually stop somebody from having one. 

O‘STEEN:  Well, I—I‘m not—we have never sought criminal penalties against a woman. 

I think it‘s much—far more effective to take away the financial incentive of the abortion doctors that are doing this for profit and for money.  And we are—and our goal, remember, is to protect unborn children and to do what will work. 

And it is a fact we have a federal system of government, yes.

MATTHEWS:  Right.   

O‘STEEN:  Yes, we‘re going to work for laws in all of the states.  And we will overturn Roe v. Wade.  And Fred Thompson would help do that. 

MATTHEWS:  Do you believe that abortion is murder? 

O‘STEEN:  I believe it‘s the killing of a human being.  Murder is a technical term.  And right now, unfortunately, it‘s legal.  But it‘s the killing of a human being. 

MATTHEWS:  But you do believe it‘s murder? 

O‘STEEN:  I believe it‘s the killing of a human being, that‘s the term. 

MATTHEWS:  It just seems like you make a basic political judgment that would blame the doctor, when, in fact, these doctors don‘t go door to door offering people abortion services.  The person who wants the abortion goes to a doctor and has the procedure done by the doctor.  Yet you put the onus on the doctor.  It just seems to be the strangest way to enforce a law.

O‘STEEN:  Remember, that‘s where the financial incentive is, and the physician knows what they‘re doing.  How many women have been told this is a blob of tissue?  This isn‘t really a human life?  How are they pressured by men that want to escape their responsibilities, perhaps?  What about a young girl that‘s been impregnated by a male, where it‘s a case of statutory rape? 

But the abortion doctor knows exactly what they‘re doing.  They‘re taking a human life.  And you will see Roe v. Wade reversed and you‘ll see respect for human life restored.  And Fred Thompson will help do that. 

MATTHEWS:  Thank you very much for coming on this show, David O‘Steen of the National Right to Life Committee.  Up next, Rudy Giuliani is still leading in the big states.  But who is in the best position to catch him?  The round table is coming up next.  This is HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Let‘s get right to the round table.  Chuck Todd is our NBC News political analyst.  David Gregory, of course, is the chief White House correspondent for NBC News, and Julie Mason is with the “Houston Chronicle.”  We‘re going to get a good report from David Gregory in just a moment, the next segment after this, about what‘s going on with this Fred Thompson thing.  But let‘s start with the hottest game in town, which is still the Democrats.

Chuck Todd, what is the shape of the field right now?  Is Hillary limping?  Is she coming back?  Is Bill getting in the way, big footing this thing, or what? 

CHUCK TODD, NBC NEWS POLITICAL ANALYST:  I think she‘s coming back to the field.  You know, part of this whole, you know, storyline, this idea that maybe Obama has momentum—I think, yes, he certainly got his sea legs over the weekend, and she‘s falling back a little bit to the field.  But she‘s still ahead.  There‘s going to be some more polling numbers coming out over the next week in Iowa and New Hampshire.  It‘s probably going to show similar falling back, but still ahead. 

So she doesn‘t look like—two weeks ago, three weeks ago, people were ready to say it‘s over.  This Republican race looks more interesting.  Now it looks like there‘s a race on our hands. 

As for Bill, I think that he is yet to be a positive for her in these last two weeks.  They need to figure out how to use him better because he‘s not on message with the campaign. 

MATTHEWS:  I‘m hearing you laughing at that, Julie.  I want the female view.  I‘m sorry, David, I‘ve got to hear this, because this whole thing about men and women in society is fascinating, because most of us are married to women who are very much our equals, whether we like it or not.  That‘s a fact.  We‘re all equals.  And we‘re all used to going home and arguing about these things.  What is going on where a strong woman who said I‘m your girl if you want a fight just a few months ago in Chicago, and now she‘s out sort of blaming everything from the moderator to the next moderator to the ringers to the other candidates to Swift Boaters?  Why so many excuses for somebody as strong as anybody else? 

JULIE MASON, “THE HOUSTON CHRONICLE”:  I know, it‘s so tedious.  Isn‘t it.  It‘s like she‘s trying to have it both ways.  But what strikes me is how all these things that are happening, like the planted questions and the excuses, it‘s all sort of serving the stereotype that people have of her, especially her detractors.  I just wonder if that‘s going to become a factor. 

MATTHEWS:  David, your thoughts, because I think these shots at her about character and manipulation are not ideological or partisan.  They‘re the things that can be used in a general election if she wins the nomination. 

DAVID GREGORY, NBC NEWS WHITE HOUSE CORRESPONDENT:  Couple points, just having returned from Iowa and talking to Democrats there, one thing that strikes them is that the race is not moving, that it‘s been sort of frozen in this time and space now for the last couple of months.  She‘s ahead, not by much.  It‘s still a three person race and she‘s not breaking away.  Nor are Edwards or Obama really taking her down.  The advantage for them, she‘s having to deal with things that are not what she wants to talk about.  But that‘s just a tactical issue.

the bottom line is, there‘s still a fundamental question that has to be answered in Iowa and in other early voting states.  Do they want—do Democrats want Hillary Clinton to be the nominee?  And these little issues, everybody is batting back and forth, go to this question of her credibility, of her integrity.  Those issues about whether people really trust her and like her.  That‘s really I don‘t think the ground she wants to be fighting on right now. 

MATTHEWS:  Yes, it seems like, Chuck, every time we have a conversation it‘s like a Rohr-Shock (ph) test.  Sometimes it‘s gender specific, but it isn‘t always.  We get a lot of reaction to the smallest things, like this ringer story.  Joe Klein was on and says everybody does it—I don‘t know if that‘s true or not—but everybody jumps sort of one way or another.  This shows that she‘s a manipulative candidate.  Other people say it‘s trivial to even talk about it. 

TODD:  The problem—and both David and Julie hit on this—is that she‘s got to be careful of the old story lines coming back.  You know, I‘ve always had this theory if she becomes president, it‘s because she‘s a woman.  If she loses, it‘s because she‘s a Clinton.  And that ultimately, the Clinton stereotype of being triangulating, calculating, parsing sentences, if that is ever the message of the week or the campaign debate of the week, as it was for three or four days—and planting questions fits into that whole umbrella—whenever that‘s being done, those are bad days for Hillary Clinton.  Then suddenly it‘s the Clinton being emphasized and not the Hillary. 

MATTHEWS:  David, it seems like there‘s so many voices coming out of the campaign.  Drudge referred to an insider today trying to intimidate our colleague, Wolf Blitzer, who said he is not being intimidated, but these weird voices that come out in the middle of the night.  Is it Mark Penn?  Is it Mandy?  We‘re not going to say who they are.  But it seems like there‘s so many voices coming out of that campaign.  They‘re not under control, or are they? 

GREGORY:  I think there‘s a flip side to knowing how to deal with the press and to engaging a lot.  You know, there‘s an over-emphasis on media management and on message management.  I think maybe they get into some trouble in that regard and they‘re trying to control so many aspects of this campaign and not make any mistakes.  That‘s impossible.  But they‘ve still gotten plenty of high marks.  But I just come back to these fundamental questions that have to be answered by this campaign, and I don‘t know that, in the end, it‘s a problem for her to be cautious on some of these things. 

She may take a shot that she‘s too cautious that she won‘t answer any tough questions, but in the end Democrats in Iowa and elsewhere want to know whether she can win. 

MATTHEWS:  That‘s the question.  Who is winning that argument right now?  Who is winning the argument?

GREGORY:  Who‘s winning the argument of whether she can win?  I think she‘s still effectively winning the argument.  But I think that Iowans, from people I talk to, are not only being very careful to look at this, but they‘re afraid of making a mistake.  They look back at 2004, where they went for the veteran in John Kerry and rejected the movement candidate; and they want to be sure, because they see it. 

You pick it up anecdotally.  I was at a Fred Thompson event and heard a Republican who voted for Bush said, I went to see John Edwards, and he impressed the heck out of me.  But I wouldn‘t walk across the street to go hear Hillary Clinton.  That‘s what she‘s up against.

MATTHEWS:  Let me ask Julie the same question.  Who do you think is winning the winnability argument right now, who is the John Kerry in this? 

MASON:  As you recall, Chris, it wasn‘t John Kerry at this time four years ago.  It was Howard Dean.  So I think people are still really looking at the numbers, and it still looks like Hillary.  But it‘s so close in Iowa, as we‘ve talked about before.

MATTHEWS:  Let me go back to chuck.  It seems to me that all this talk about Hillary being the target of abuse the last couple weeks, everybody‘s focusing on her—I‘m certainly doing it—out of that comes this weird American phenomena—the fact that Barack Obama is African-American is almost being ignored as a possible obstacle to election as president; and he‘s being considered—he would be the safe bet the last couple of days.  Has that moment passed? 

TODD:  No, I think that there‘s different—the way this calendar shapes up, I think gender was always the first question we were going to deal with, because Iowa specifically had a history of not electing women into high office.  It‘s one of just two states that never sent a woman to Congress.  OK?  I think South Carolina, down the road, assuming Obama can get through Iowa and New Hampshire, where they have never dealt with the racial politics issue—those are places he can get through this. 

South Carolina is going to be the test where suddenly we shift from talking about gender to where we‘re going to talk about race.  I think that if we get there, that‘s where it happens.

MATTHEWS:  If you guys want to know—and Julie want to know where states tend to elect women to high offices like U.S. senator, look for large bodies of water nearby.  For some reason, if you look at the map of the United States, this is one of those oddities; New York, Maine, Washington State, California, Texas; if there‘s a large body of water nearby, there‘s a better shot for a woman. 

Figure that one out.  We‘ll be right back with the round table.  We‘re going to talk Republicans, starting with David‘s interview with Fred Thompson.  You‘re watching HARDBALL, only on MSNBC. 

(BEGIN VIDEO CLIP)

GREGORY:  Facing an important decision, who is the most important person that you want in the room?   

FRED THOMPSON ®, PRESIDENTIAL CANDIDATE:  My wife. 

GREGORY:  Your wife?  She‘s your best advisor? 

THOMPSON:  Yes.

(COMMERCIAL BREAK)

GREGORY:  Do you think you‘re working hard enough to win this thing? 

THOMPSON:  Yes. 

GREGORY:  And to those people who question the pace of your schedule or your commitment or your passion, what do you say? 

THOMPSON:  See you election night. 

(END VIDEO CLIP)

MATTHEWS:  I love that, David.  Yep, gulp.  He went for the coffee rather than continuing the thought.  What is your sense of his—does he have the bug, as we call it in politics, the absolute desire to win? 

GREGORY:  I don‘t know.  I just can‘t say that I know.  He is, you know—I spent a lot of time with George W. Bush on the campaign trail and the thing that always struck me was the energy, the passion and the crispness of his campaign style.  Totally different style than Fred Thompson. 

MATTHEWS:  He‘s more of an MBA guy, right?  That‘s what he was when he came in.  Let‘s face it. 

GREGORY:  But I just mean his level of passion on the campaign trail was different.  I think Fred Thompson is a—yes, he tells a longer story, kind of a gentler figure.  He lacks that crispness in his presentation.  He‘s a comfortable figure.  He‘s an avuncular figure.  He made people feel secure, feel good.  I picked some of that up. 

But he‘s certainly not—I said, do you like to be underestimated, like Bush does.  He said, yes, up to a certain point.  But not forever. 

MATTHEWS:  Up to a point in time.  Let‘s go to Julie.  Julie, I thought one of the outside theories—I did not have—I have more of a sense that Hillary is the front runner on the Democratic side—I really do believe she still is the best bet.  But on the Republican side, I can see Rudy getting the coastal states, the big states, the big tickets, all those delegates.  And I can see Romney sweeping across the north with his money and his organization, and let‘s face it, his LDS support. 

Then I see a big thing in the south—I don‘t know where it‘s going to go.  Will Fred Thompson grab the bible belt, and become one of the three leaders at the end of this fight? 

MASON:  He could, Chris.  That could very well happen.  But what strikes me about Fred Thompson right now is that poll after poll show us that people, Democrats and Republicans, they want change.  They want dynamic, meaningful, urgent change.  I don‘t think Fred Thompson represents that.  I mean, this lackadaisical style, hold the course kind of thing.  Maybe for a different time in America he would be a better candidate, but for right now, it just seems the mood of America isn‘t really Thompson conducive. 

MATTHEWS:  What about the word comfort, La-Z-Boy recliner.  That‘s what I think of when I look at him, a La-Z-Boy recliner.  In fact, most of his acting roles, David, have been in those big leather chairs with the well appointed office behind him, very comfortable and very comforting. 

GREGORY:  Chuck will weigh in on this, but here‘s the rationale; Fred Thompson right now is running on the idea of what he‘s not, that he‘s not Giuliani.  He‘s not Romney.  On abortion, he‘s always been anti-abortion rights.  And that he is not doing what Giuliani is doing, which is telling the Republican party, let‘s change our identity.  Let‘s change what we are as a party and elect a guy like me, who cares about terrorism first, and let‘s put the social issues aside. 

He‘s say, no, let‘s be who we always were as conservatives, and just apply those principles to new issues.  He does—this is new.  It was nuanced but new.  He talks about Washington lacking credibility.  And he was willing to criticize the president yesterday, saying we didn‘t know we were getting into in Iraq.  That‘s different in terms of what we‘ve been hearing from these Republican candidates. 

MATTHEWS:  Let me go to Chuck.  Chuck, your thoughts, he got the Right to Life endorsement today.  I‘m sure the other guys would have liked to have get it, except for Rudy.  Does he get a bump? 

TODD:  I think that‘s an organizational shot in the arm.  National Right to Life that‘s like—they‘re like labor and how they—when they get behind a candidate, they spend money.  They do direct mail.  They do phone calls.  They have a following.  This is big in Iowa and South Carolina. 

MATTHEWS:  Thank you very much Chuck Todd.  Thank you very much David Gregory, Julie Mason.  Join us again tomorrow night at 5:00 and 7:00 Eastern for more HARDBALL.  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.

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