updated 11/30/2007 12:52:15 PM ET 2007-11-30T17:52:15

Guests: John Harris, Jonathan Alter, John Edwards, Naomi Klein, Michael Musto

KEITH OLBERMANN, HOST (voice over):  Which of these stories will you be talking about tomorrow?  Rudy Giuliani‘s love shack in the Hampton‘s, security expenses charged to New York City taxpayers.  Was his office in the city‘s doomed emergency command post at the World Trade Center used the same extra marital affair?  The Giuliani staff including the billing of his tryst related expenses to outfits like the New York City Office for people with disabilities hit the fan.

(BEGIN VIDEO CLIP)

RUDY GIULIANI, ® PRESIDENTIAL CANDIDATE:  First of all, it‘s not true.  I had nothing to do with the handling of their record.  And they were handled, as far as I know, perfectly appropriately.

(END VIDEO CLIP)

OLBERMANN:   As far as he knows.  And still the question of how well he knows—the man who let Khalid Shaikh Mohammed escaped capture by the FBI five years before 9/11.  Will Giuliani and Romney wound one another at the debate.  The lunatic right wing fringe goes nuts over questioners who may have had peripheral connections to Democratic candidates.  If you can‘t handle the Democrats, how are you guys going to handle al Qaeda?  John Edwards join us on how the Democrats are handling the opportunities presented them by the Republican self destruction.  And the new catch phrase for open-campaign fundraising that it‘s an election, not an auction.

Disaster capitalism.  Is that what the administration has done in Iraq, with Katrina, at every turn?  Seen not suffering, but opportunity to get reconstruction profits for their best friends.  Naomi Klein, author of “The Shock Doctrine,” joins us.  I‘ll plug my book and to say thanks again for it on the Amazon‘s Movers and Shakers list.

And breaking Paris Hilton news: She‘s even dumber than you thought.

(BEGIN VIDEO CLIP)

PARIS HILTON, CELEBRITY:  How would an elephant get off (ph) in the first place?  Why would I talk about that?  Why would I care?  Elephant got drunk - can an elephant get drunk?

OLBERMANN:  Oh, boy.  All that and more, now on COUNTDOWN.

OLBERMANN (on camera):  Good evening.  This is Thursday, November 29th, 331 days until the 2008 presidential election.  In a radio ad, the Rudolf Giuliani campaign started running last month in Iowa.  The former mayor of New York says, quote, “I have no question I can do the same thing for Washington that I did for New York City.” 

Now, our fifth story of the COUNTDOWN: If he‘s talking about what he did for the residents of New York City, that would mean President Giuliani could be expected to bill obscure Federal agencies for security expenses incurred on weekend getaways with the mistress, maybe even provide a Secret Service driver and car for this future hypothetical paramour.  If he means that he could do the same for Washington that he did for Judith Nathan specifically - well, you know I‘m going with that.  Your top sellers in action—new day, new revelations for America‘s so-called mayor to deny.  This afternoon‘s bombshell coming from the blogger at Abcnews.com.  Well before it was publicly known, he was seeing her, the then married Mr.  Giuliani provided a police driver city car for his mistress, Judith Nathan, the woman who would become his third wife. 

One former city official who worked for Giuliani telling ABC quote, “she used the PD” the police department, “as her personal taxi service.”  This coming on the heels of yesterday‘s bombshell from Politico.com that many of the security expenses for trips Giuliani to made, to rendezvous with Miss Nathan in the Hampton‘s, were initially billed to obscure city agencies.  Mr. Giuliani dismissing that story today to ABC as a pre-debate hit job.  Further in an interview with CBS News, Mr. Giuliani claiming that the police department really paid for those expenses anyway, explaining because the NYPD could be slow at first to cover its bills, city hall would find a way to cover the invoices in any way it could, calling it standard operating procedure that started from his first term. 

If only that were the case, why did, as ABC reports, New York City own comptroller begin to question the accounting?  Why did then Mayor Giuliani office decline to provide any details?  Ed Koch, who served as mayor of New York from 1978 to 1989 saying today, it looks to him as if Mr. Giuliani acted improperly and appears to be covering something up.  On CBS earlier tonight, Mr. Giuliani with a different take on how this will appear.

(BEGIN VIDEO CLIP)

GIULIANI:  It will show that we do things honestly, honorably, above board.  All of this is easily explained and all of it is very discoverable.

(END VIDEO CLIP)

OLBERMANN:  Giuliani‘s accounting regularities were uncovered by Politico.com.  We‘re joined now by its editor-in-chief, John Harris.  John, thanks for your time tonight.

JOHN HARRIS, POLITICO.COM:  Good evening.

OLBERMANN:  Let‘s start with news stuff, the meat of the ABC report is basically your report amped up by one degree, specifically saying that those hidden expenses involved over time and per diem costs for officers traveling with Giuliani to secret weekend rendezvous with Judith Nathan in the fashionable Hampton‘s.  That is tax supposed (ph) money for spending taxpayer money, does his answer today wash that it was long standing policy, that is a way to pay the bills quickly, that the police department reimbursed city hall for it?

HARRIS:  Well, a couple of things.  We did give him a chance to make that answer when Ben Smith, who first broke the story on Politico took what he‘s reporting to Giuliani campaign and to Giuliani in all ways a couple of days in advance.  They had no response.  So, it‘s certainly taken him a while to come up with this response.  And the thing that is still not answered is why obscure agencies like the New York City Loft Agency.  This is not how most trips were charged.  The most trips you can look at in the books and they‘re billed more conventionally.  You can see it charged to the mayor‘s office and, yes, indeed, it does get reimbursed to—the police department does get reimbursement, but it‘s all very easy to see.  The records that we saw were not easy to see.  No one had seen them except the city comptroller for several years.  And we still don‘t have an explanation of why.

OLBERMANN:  And the other part of this, the other ABC story today - he‘s mayor, he‘s providing a police driver and a city car for his mistress.  Unfortunately, he also has a wife at the time.  She also gets a police driver and city car.  A year ago, the comptroller of the New York state had to make a deal with prosecutors after he‘d been found using state employees as chauffeurs for his wife and she had physical problems, emotional, health problems.  She was also his wife.  That comptroller had to resign, pleaded guilty to a felony charge to avoid going to prison.  Could the Judith Nathan police taxi story be bigger than just political scandal for Rudy Giuliani?  I mean the fact, comptroller scandal was criminal, might this be criminal?

HARRIS:  I don‘t have any evidence this is criminal.  And I will say in fairness to him, it wasn‘t very long before his relationship with Judith Nathan became public.  So, presumably, she may have been at some security risk.  I don‘t know.  That‘s not our story suggested.  I don‘t think the ABC report suggested criminality.  What it does suggest, it always looked definite efforts being made to build these obscure agency, apparently to conceal the financial record.  It‘s unwelcome because it does kind of open a door to a part of his mayoral term that he‘s not particular eager to have subjected to public scrutiny here a month out from the Iowa caucus.

OLBERMANN:  And after his juncture, is that campaign approaching critical mass?  You have a car and driver for his then mistress; you have transferring security costs to these weekend trysts to the obscure city agencies, the report that came out in August from Wayne Barrett that he and the mistress would also rendezvous at seven World Trade Center which was that disastrous choice he made for where to put the city‘s emergency response bunker.  Bernard Kerik, you don‘t have to say much more that, except that he was using an apartment that was donated for the use of 9/11 emergency workers to rendezvous with his mistress, Judith Regan, who‘s still threatening all sort of dire consequences, the perjury may have be suborn.  At what point does a Republican candidate who was already viewed with suspicion by a large part of his party, to what—does he have to necessarily collapse under the weight of drip, drip, drip or can somebody like this survive something like this?

HARRIS:  You know, beats me.  I‘ve been surprised to the degree with to which Rudy Giuliani has had Teflon-coating, not just on personal matters, but also on ideology.  You know, he‘s got a lot of positions that don‘t traditionally fit well with the conservative base.  He‘s done well so far.  So, I don‘t know.  What I will say about this episode is that it shows that he has - I mean he did not handle this well.  If he had answered these questions initially, it‘s possible this wouldn‘t have blown up in such a big way.  We had a stone wall.  And then, you know, series of answers that still don‘t really fundamentally address the question.  And it seemed with that tactic‘s done, it‘s prompted a whole lot more additional stories.

OLBERMANN:  Right.  And there‘s one coming tomorrow in the “New York Times” on his use of statistics in the campaign, whether he‘s been the one who‘s reduced crime, reduced taxes or if, in fact, they increased.  So, you‘re right.  It is tended to make people much more suspicious than they were at the beginning of the week.  John Harris of Politico.com, who got this ball rolling.  Great thanks for your reporting and for some of your time tonight, sir.

HARRIS:  Thanks a lot.

OLBERMANN:  Mr. Giuliani finding no sanctuary during the rest of last night‘s Youtube Republican Debate, the entire first half hour devoted to illegal immigration and the man who were leading in the early primary states, Iowa and New Hampshire, former Massachusetts governor, Mitt Romney, accusing the national front runner, Mr. Giuliani of having retained New York status as a sanctuary city for illegal immigrants when he was mayor.

(BEGIN VIDEO CLIP)

MITT ROMNEY, ® PRESIDENTIAL CANDIDATE:  We‘re going to have to recognize in this country that we welcome people here legally.  But the mayor said, and I quote almost verbatim, which is if you happen to be in this country in an undocumented status - and that means you‘re here illegally - then, we welcome you here.  We want you here.  We‘ll protect you here.  That‘s the wrong attitude.

GIULIANI:  Mitt generally criticizes people in a situation on which he‘s had farther worse record.  There was even a sanctuary mansion at his own home, illegal immigrants were being employed, not—not—not being turned in to anybody or by anyone, so I would say, he had sanctuary mansion, not just sanctuary city.

(END VIDEO CLIP)

OLBERMANN:  Well, Mr. Giuliani and Mr. Romney would not stop their hits and let others talk; the crowd eventually booed Mr. Giuliani.  But the man who possibly won it on illegal immigration or at least appeared of won the moral high ground if not the debate itself was the former Arkansas governor, Mike Huckabee after Mr. Romney criticized him for a proposal he made as governor to give college scholarships to the children of illegal immigrants.

(BEGIN VIDEO CLIP)

ROMNEY:  Mike, that‘s not your money.  That‘s the taxpayers‘ money and

MIKE HUCKABEE, ® PRESIDENTIAL CANDIDATE:  In all due respect, we‘re a better country than to punish children for what their parents did.  We‘re a better country than that.

(END VIDEO CLIP)

OLBERMANN:  But for the far Right, the debate was all about the heretics, particularly retired army Brigadier General Keith Kerr, an openly gay man who came out after retirement who asked the candidates about the military‘s “Don‘t ask, don‘t tell” policy.  Because General Kerr had lent his name to a Hillary Clinton steering committee, a fact revealed by CNN in its post debate coverage, where lunatic fringe contending today that the general must have been planted by the Clinton campaign.  Michelle Malkin and Bill O‘Reilly for one and two, dividing that every questioner who is merely expressed support for a Democratic candidate at some point must also have been a plant.  Hey, Michelle, if you can‘t stand up to the Democrats, how are you going to stand up to al Qaeda?  Let‘s turn now to our own Jonathan Alter, senior editor of “Newsweek” magazine who‘s with us here in the studio.  John, good evening.

JONATHAN ALTER, NEWSWEEK:  Hi, Keith.

OLBERMANN:  So, the Right noise afterwards here is organic as it is in you know, from the Left after any debate.  The part that isn‘t is usually designed to paint something over, to hide something.  What was it in that debate that Republicans don‘t want people to remember the day after?  Was it the booing of Republican candidates, was it Huckabee‘s humane answer?  What was wrong with that debate?

ALTER:  The whole thing was wrong.  I mean, it - this did not present a very positive face for the Republican Party.  They were squabbling.  Republicans themselves don‘t like any of their candidates all that much.  Remember, the Democrats generally are happy with their candidates, the polls show.  Republicans are unhappy.  They thought that maybe Fred Thompson was going to solve their problems, he turned out to be a dud.  So, this is a very cranky party right now.  I think you see that on the blogs.

OLBERMANN:  Yes, moodiness, I think, was the kind way of phrasing what that looked like last night.  As contrasted to the last few Democratic debates, which have been not necessarily moody, but certainly, everybody versus Hillary.  There is no everybody versus fill in the blank yet, even with Giuliani‘s lead nationally or Romney‘s in the opening states.  Does that suggest that the poll thing is completely wide open, no matter who has a big lead and where and under what circumstances?

ALTER:  It‘s pretty wide open; it‘s bumper cars out there for them right now.  And actually, you know, Huckabee‘s emergence, I thought he clearly won last night, it‘s good news for Giuliani because if he beats Mitt Romney in Iowa and I was just there in the last few days and it looks like Huckabee is really surging.  That could help Giuliani down the road by taking out or at least hampering his primary opposition.  And then you have somebody‘s winner take all primaries under Republican side that could help Giuliani.  So, despite these scandals, what talkingpointsmemo.com, one of the great liberal blogs out there calls the shag fund the story.  Despite Giuliani‘s problems right now, he‘s in a fairly strong position, but hardly the preeminent favorite.

OLBERMANN:  Is that - to some degree, that story, the shag fund story, was that the surprise of the debate last night?  Because it is - Giuliani‘s assertion today that that was a plant from one of his rivals.  If that was a plant from one of his rivals, why did he only get one question from the audience and nobody touched it from - among his opponents?

ALTER:  Well, you know, when a story is breaking, rivals tend to want to steer clear of it until the dust settles a little bit.  So, that wasn‘t surprising.  I was actually surprised that CNN didn‘t press the issue a little more.  And I think they fell down a little bit there you know.  It was a breaking story.  They had a peg, a news peg as we call it, to pursue it.  And they just asked one question.

OLBERMANN:  Yes, there were a few problems.  But we‘ll just leave that alone.  You mentioned Huckabee.  Let‘s finish of there, being declared the winner by many especially again, for that humane kind of answer.  Is it possible that - he - describe this campaign as having like a shelf life the way milk does.  He spent all his money upfront.  There‘s no chance to get more.  He‘s got to expire at some point.  Is that now proving possibly not true?  Could he, in fact, be a top three tier candidate for this nomination?  Could he still get it?

ALTER:  Yes, absolutely, he could.  You know, I‘ve argued that he would actually be their strongest candidate in a general election.  His problem is that he doesn‘t have anything on foreign policy or national security and that‘s so important in that party right now.  And the other thing is his lack of money.  The Republican Party lack of money is a character flaw.  In the Democratic Party, you get away with it.  But so, he‘s certainly not the likely nominee.  But he‘s very much in the hunt.

OLBERMANN:  A moral failing lack of money.  The other thing, I mean, you know, we‘re talking about the sanctuary mansions.  I don‘t know why Romney didn‘t come back and say, well let‘s not talk about your mansion in the Hampton‘s, mayor.  Jonathan Alter, senior editor at “Newsweek,” great thanks as always.

ALTER:  Thanks, Keith.

OLBERMANN:  One additional note on Rudy Giuliani, more accurately on the coverage of Rudy Giuliani - Wayne Barrett of the “Village Voice” was on this newscast to discuss his reporting on Giuliani‘s connections to the royal family of Qatar last night, specifically to its one member who is himself accused of spiriting the 9/11 mastermind, Khalid Shaikh Mohammed way from capture by the FBI in 1996.  It should have been noted that much of Mr. Barrett‘s reporting was connecting the dots originally contained in reporting by the “Wall Street Journal” and the “Chicago Tribune.”

Mitt Romney took time off last night from slapping Giuliani to go after John Edwards as well.  Senator Edwards will join us from Iowa.  And “The Shock Doctrine.”  How to remake a people‘s economy?  For those people still stunned from a disaster, like hurricane Katrina or the Iraq war.  The author, Naomi Kline, joins us.  You‘re watching COUNTDOWN on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN:  Attacked by name in the Republican debate by Willard Mitt Romney, Senator John Edwards stuck among Democrats and certainly his sense of pride must have moved ever so slightly upwards.  He will join us from a presidential campaign trail in Iowa.

And the epic battle of the titans in Worst Persons.  Pat Robertson versus John McCain versus Bill O.  All ahead on COUNTDOWN.

(COMMERCIAL BREAK)

OLBERMANN:  At the next scheduled Democratic debate, non-of the Democratic candidates will be answering questions from Republicans or from anyone else for that matter.  On our fourth story on the COUNTDOWN: CBS has canceled the December 10th debate after our next guest, John Edwards and others said they would not cross the picket line, the striking CBS writers.  Of course, that does not prevent any particular Democrat from weighing in on last night‘s Republican debate in which at least one Democrat was allowed to ask a question or from weighing on any of the embarrassments plaguing Mr. Giuliani like a plague of locust sore, about say, Mr. Romney‘s flip-flops about Muslims or abortion or anything else.  As promised, joining us now from Iowa City in the campaign trail, the former senator and current Democratic presidential candidate, John Edwards.  Senator, great thanks for your time tonight.

JOHN EDWARDS, (D) PRESIDENTIAL CANDIDATE:  Glad to be with you, Keith.

OLBERMANN:  The American people today are rising up, demanding to know how at least one Democrat slipped through the system last night, resist the temptation to ask you that question about how the Republicans answer al Qaeda, if they can, answer a Democrat.  Instead, can you tell us for the record if you have contingency plans in place if, heaven forbid, some time in the future someone who‘s not a Democrat, even an actual registered Republican were somehow able to ask you a question?

EDWARDS:  Heaven forbid.  I mean, how could we possibly survive if someone who is antagonistic or has a different point of view than you do ask you a question?  And no, we can‘t possibly expect somebody who answers questions from either independents or the other party to get elected president of the United States.  How could anybody be ready to do that?  I think this whole discussion‘s ridiculous.

OLBERMANN:  Speaking of ridiculous, what do you see as the biggest gift the Republicans have handed all the Democratic candidates, including yourself, up to and including last night?  What can the party do as it starts to focus on the actual general election of 2008?

EDWARDS:  I think two things.  One is they really, when it comes to the war, they sound like—to me, they sound like Bush on steroids.  I mean, they‘ve not given us such a clear choice.  I‘ve said clearly that I‘ll get combat troops out and end combat missions in my first year.  If they‘re going to continue the war, indefinitely, the best I can tell.  If Americans actually want this war in Iraq to continue for another decade or so, they should vote for the Republicans.  If they want the war ended, they should vote for me.  And I think that clear choice is something the American people are going to have next Fall.  And, then second, I didn‘t get to see the debate.  But I heard that Mitt Romney said something about the two Americas that I‘ve talked about in the past and how he doesn‘t think they exist.  You know, what planet does this guy live on?  I mean, all you‘ve got to do is pay any attention to what‘s going on.  The middle class is having trouble paying their bills.  Their wages are stagnant.  We got 37 million people who live in poverty.  We‘ve got 35 million people who went hungry last year.  And he thinks that everybody is doing great?  That‘s not the real world.  And they‘re completely out of touch with what‘s actually happening, and the fact that we have very well financed, very powerful interest in Washington that, in many ways, have taken over the government and the Democracy against the interest of most people in this country.

OLBERMANN:  You would think that even the two Americas that are constituted solely by those who are having their homes foreclosed on and those who are not would have registered in that debate last night.  But there‘s a breaking news story.  You mentioned Iraq.  There‘s a breaking story about what Australia is going to do.  The prime minister-elect, Kevin Rudd, who just succeeded or will succeed John Howard, who won the weekend before last in the election, has just said it is his intent to, by the middle of next year—it‘s not a huge contingent, but 550 troops.  He intends to get the Australian troops out of Iraq by the middle of next year.  Do you have a reaction to that?  Is that the kind of thing that builds momentum towards ending this thing?

EDWARDS:  It‘s not surprising at all.  I mean, he‘s seen what‘s happening in Iraq.  He sees there‘s no—what all of us see, that there‘s no serious progress toward a political reconciliation between Sunni and Shia.  Everyone, including the bipartisan Iraq study group have recognized that unless there‘s a political compromise, there can‘t be stability, there can‘t be an end to the violence.  And America needs to be leaving.  These people are going to eventually have to take responsibility for their own country.  And I think we‘ve reached that stage.  And so that‘s—I‘m not at all surprised.  I hadn‘t heard the news, but it doesn‘t surprise me.

OLBERMANN:  Yes, it just happened a couple of minutes ago.  Apparently he made a speech in Sydney.  Something that happened in a speech in Iowa during the week resulted in a lot of debate on the Democratic primary trail, whether President Clinton supported the invasion of Iraq or not.  And he claimed not.  I‘ve been trying to figure out, does it matter?  And if so, to whom and why?

EDWARDS:  Well, it may matter to President Clinton.  I mean, he‘s a very well-known national figure.  I don‘t think it matters to the presidential race.  I mean, he‘s not on the ballot.  Senator Clinton‘s on the ballot.  We‘ve talked about the differences, the policy differences we have on this issue.  I do believe we‘ve got—my first year in office, I have to get the combat troops out.  And we‘ve got to end combat missions.  She has a different view, about keeping combat troops there and continuing combat missions and she‘s entitled to that view.  But I think those differences give voters choices in the primary election.  But I don‘t think most people—most people understand that President Clinton is not on the ballot and Senator Clinton is on the ballot.

OLBERMANN:  Last point.  This has been raised in Iowa by you, summarized by something phrased on the Internet as this is an election, not an auction.  You‘re addressing the subject of raising funds and pledging.  Explain that, if you would.

EDWARDS:  Well, I don‘t think that the Iowa caucus voters, New Hampshire primary voters, South Carolina primary voters, Nevada caucus goers, I don‘t think they‘ll vote for somebody because they raised the most money.  In fact, in some ways, that runs against what the Democratic Party supposed to represent.  We don‘t win elections—I heard your earlier discussion.  We don‘t win elections about raising the most money.  We win elections on principle, by doing what‘s right.  By actually being the party of the people, not by being the candidate who‘s actually raised the most money.  So, actually, I‘m proud of the fact that I agreed to take public financing for this presidential primary election.  I did it for a reason.  And I think that, actually, caucus goers and primary voters are going to decide who is telling the truth about Washington and who will fight it for them.

OLBERMANN:  John Edwards taking time out from the campaign trail in Iowa to talk with us this evening.  Always a pleasure, Senator.  Great thanks for your time.

EDWARDS:  Thank you, Keith.

OLBERMANN:  Ahead on Worst Persons: Even the Republicans at that debate last night showed they have enough of people comparing honest dissent with appeasing the Nazis, John McCain finds out and finds out if he can beat Bill O and Pat Robertson for tonight‘s crowd.

And, robot dentistry.  Doctor, my mouth tastes like metal.  When COUNTDOWN continues.

(COMMERCIAL BREAK)

OLBERMANN:  Eighty years ago today in the Bronx, New York, was born the sports broadcaster of sports broadcasters.  At age 25, the youngest man to call a World Series game, an announcer for 28 different series, a role model and a hero to virtually everyone in his professing and the only one in it about whom you never hear catty stories, nor from whom you get the slightest sense of superiority, and a man who next summer will begin his 59th year in the same job.  Happy birthday to the voice of the Los Angeles and the Brooklyn Dodgers, Vincent Edwards “Vin” Scully. 

Let‘s play Oddball.

(BEGIN VIDEOTAPE)

OLBERMANN (voice-over):  We begin in Tokyo with world‘s largest robotic convention displaying a wide array of man-made genius.  Some robots played drums while dressed as geishas.  We don‘t really know why.  Some mini robots danced.  Maybe it was tai chi.  Not sure about that either.  We don‘t know why. 

But there was at least one exhibition that really made sense.  Robots as dental patients so that dental students can practice without hurting real people.  The lady robot even has teeth.  As you heard, she cries out when the student drills too close to the nerve.  That‘s right, save the anesthesia for the humans. 

(END VIDEOTAPE)

OLBERMANN:  The Iraq war as economic reset, as described by our guest, the author of “The Shock Doctrine,” Naomi Klein. 

And Paris Hilton finally responds to the misquoted story that suggested she was taking up the cause of drunken elephants in Africa.  Just when you thought she couldn‘t make a bigger fool out of herself, she does.  These stories ahead, but first time for COUNTDOWN‘s top there best persons in the world.

Number three, best reality TV show reference, an unnamed 19-year-old man from Chihalis (ph), Washington, arrested at a mall after he allegedly punched a policeman in the face several times.  The suspect had gotten uncontrollably angry, he said, because, quote, Tila (ph) Tequila would not respond to his e-mail.  Police took away his nun chucks.  If you have ever seen “A Shot at Love” with Tila Tequila, you already know what they should have taken away was his TV. 

Number two, best hockey fan, artist Kurt Kauper, who has now painted at least three oils of 1960s and 1970s Boston Bruins stars Bobby Orr and Derick Sanderson (ph).  One of the Orr paintings is seven and a half feet tall.  In each of them Orr and Sanderson are shown on the ice, on skates and otherwise naked.  Hey, Bobby is using a curved stick. 

Number one, best invention, Gail Knight, 26 year old student in London, in England, seeing a need and coming up with an idea.  Just going into service there; if you text the word toilet from your cell phone to the SatLab service, it will send you back a text message telling you where the nearest public toilet is.  Anybody tell Senator Larry Craig? 

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OLBERMANN:  The U.S. and Iraq this week announced a broad framework for long-term relations between the two nations.  The Associate Press reporting this involves a sustained U.S. presence in Iraq and preferential treatment to American investments.  You know, a treaty.  Only don‘t call it that and nobody in the Senate gets the chance to not ratify it, or to ask why would Iraq give up a prize like that preference to American investments in return for a military presence the U.S. supposedly needs for its own security anyway? 

In our third story tonight, a new book says the answer may lay in Chile.  In the early ‘60s the economist Milton Friedman pushed an extreme version of the free market, minuscule taxes, wide scale privatization of everything from utilities to schools, and virtually no government involvement in the private sector on everything from tariffs to regulation. 

The hitch?  Democracies did not want to trust their fate to the free market.  Enter Friedman‘s friend, Chilean Dictator Augusto Pinochet, who imposed much of Friedman‘s agenda anyway, introducing school vouchers, privatizing Social Security.  Chile‘s economy then crashed.  Some of Friedman‘s disciples kept faith that tyranny, war or natural disaster would give them opportunities to try the shock therapy of remaking entire economies overnight in Friedman‘s image. 

Those deciples included Donald Rumsfeld, who saw a chance for Friedman‘s shock therapy in Iraq, as did Vice President Cheney and coalition administrator Paul Bremer, who cut Iraq‘s corporate taxes to 15 percent and planned to sell off Iraq‘s biggest businesses, almost all of them owned by the country itself, to foreign investors.  As in Chile, Iraq‘s people opposed these plans, so Bremer delayed elections, installed the provisional government instead, when it looked like the popular candidates would block the Iraqi sell-off. 

Little reported at the time, violence surged well after the U.S. took control, just as word spread of Bremer‘s plans, and fears rose of downsizing, devastated Iraqi business, fearing the competition of rich unfettered foreigners.  One GOP lobbyist said, “one well-stocked 7/11 could knock out 30 Iraqi stores.  A Wal-Mart could take over the country.”  Kidnappers targeting foreign businessmen demanded that foreign businesses leave. 

And Iraq is not alone.  After the Pacific tsunami, author Naomi Klein found pristine beaches turned over to the big resorts, while the people were too shocked to stop it.  In Mississippi, most federal Katrina recovery funds have helped big business and the affluent after the Republican governor got the Bush administration to waive a Congressional requirement that half help the poor, who wound up getting only 10 percent of the funds. 

We turn now to Naomi Klein, best selling author of “No Logo,” whose book new book is called “the Shock Doctrine, the Rise of Disaster Capitalism.”  Thanks for coming in tonight. 

NAOMI KLEIN, AUTHOR, “THE SHOCK DOCTRINE”:  Glad to be here. 

OLBERMANN:  Explain this basic premise if you can. 

KLEIN:  The basic premise is that these are very unpopular policies, that people tend to protect their labor protections, their social programs.  They don‘t actually want to hand their democracies over to multinational corporations.  So, you need some kind of a shock.  And that shock could be a war.  It could be an economic meltdown.  It could be a terrorist attack, but something that creates a period of confusion, of dislocation, of regression. 

And then politicians come forward, playing a father figure.  If this remind you of anything?  Let me know. 

OLBERMANN:  Yes. 

KLEIN:  And use that period of dislocation to push through policies in a state of emergency that they wouldn‘t be able to do otherwise.  In this country, obviously, the shock of September 11th was used to privatize the U.S. military, to privatize the government, to create this hollow infrastructure of a government that is the Bush specialty. 

OLBERMANN:  In Iraq, the mess that we saw there, was that the result of no planning, or was it the desired result of a bad plan? 

KLEIN:  Well, Iraq is the classic example of the shock doctrine.  You had a military strategy that was called Shock and Awe.  It was a military strategy designed to maximize disorientation.  The theory was—This is a quote from Richard Armitage, the former deputy undersecretary of state, who said that the theory was that Iraqis would be so shocked, they would be easily martialed from point A to point B.

In that moment when they were supposed to be easy to control, easy to martial, you had Paul Bremer waltz in his Brooks Brothers suits and Army beauties, the uniform of the disaster capitalists, and say Iraq is open for business, and create this sort of—an attempt to create a corporate Utopia for American multinationals. 

It didn‘t work out.  Then you saw the emergence of a third shock, not an economic shock, but shocks to body, the shock of torture, as they attempted to control this rebellious country.  There‘s three kinds of shocks in “The Shock Doctrine,” the shock of the crisis, then an economic shock therapy program, and then, if people don‘t behave, a third shock, which is the shock of torture. 

OLBERMANN:  Did the Iraqis speak up about this attempt to privatize their country when Bremer started this? 

KLEIN:  They absolutely spoke up about it.  I was in Iraq in that first year reporting for “Harper‘s Magazine.”  I met a worker at a vegetable oil company, one of the largest state-owned factories.  He said that they were so opposed to privatizing that company that there were two choices.  They would either burn it to the ground or they would blow themselves up inside it.  That was the level of determination against these policies. 

What Iraqis saw was that, you know, this was a continuation of the war.  That‘s the way it was perceived.  There is a word for what happens when you invade a country, especially on a false pretense, and then you grab its assets.  It‘s called looting, right?  And it‘s illegal.  And Iraqis responded as if their country was being looted.  Not as if it was being restructured or developed or reconstructed or any of the cleansed words that were used to describe it. 

OLBERMANN:  It was a corporate takeover with guns. 

KLEIN:  Yes, armed robbery, yes. 

OLBERMANN:  And if it‘s a corporate takeover with guns, your argument is that awareness of the pattern, seeing where it‘s played out around the world and what this country has had to do with it, that‘s the key to stopping it? 

KLEIN:  Exactly.  Think about September 11th, that state of disorientation.  Now we look back on it, and we realize how much we lost in that moment.  We‘re only piecing—we‘re only piecing it together in this forensic accounting, which happens through scandal.  There‘s a Blackwater scandal.  Then we find out how much this one company has expanded its reach.  Or the Abu Ghraib scandal breaks and we find out, OK, there‘s private companies doing prison interrogation. 

It‘s all retroactive.  It‘s all back accounting.  If we understand how our states of shock are exploited, if we can recognize the signs, then the next time there is a crisis—and it can be an economic crisis.  And it‘s really relevant.  One of the things I do in the book is I show this 35-year history.  In much of that history, it was economic crises that played that role.  It‘s just as anti-Democratic.

But when the next shock hits, we can prepare.  I have a quote in the book, as you know, from Milton Friedman, who says that only a crisis, actual or perceived, produces real change.  He says when the crisis hits, the change depends on the ideas that are lying around.  So it‘s not just about recognizing the pattern, it‘s also about having your ideas lying around when the next shock hits. 

OLBERMANN:  We‘ll see, if we do slide into recession, maybe that‘s the one that they‘re looking for next.  Naomi Klein, the book is “Shock Doctrine.”  Congratulations on it and great thanks for coming in. 

KLEIN:  Thank you. 

OLBERMANN:  It‘s been too long since there‘s been a controversy involving basketball coach Bob Knight.  The wait is over.  There are guns.  There is videotape.  Let the party begin. 

And a huge night in Worsts, Pat Robertson versus John McCain versus Bill-O, kind of night when you wish there didn‘t have to be a loser. 

(COMMERCIAL BREAK)

OLBERMANN:  Our number two story tonight, Keeping Tabs, beginning with celebrities armed with buck shot in Texas, besides Dick Cheney.  What you‘re about to see is a standoff near Lubbock between Texas Tech basketball coach Bob, don‘t call me Bobby, Knight, for nearly five decades the leading American distributor of temper tantrums, and a neighbor named James Simpson, who confronted Knight and a hunting companion about shooting doves too close to his, Simpson‘s, home. 

The video, courtesy of the “Dallas Morning News” is fuzzy, but then again, so is Bob Knight‘s sophistry. 

(BEGIN VIDEO CLIP)

JAMES SIMPSON, NEIGHBOR OF COACH BOB KNIGHT:  I asked you nicely. 

BOB KNIGHT, TEXAS TECH BASKETBALL COACH:  What? 

SIMPSON:  Move down.  You‘re too close to my house.  Pellets fell on my house. 

KNIGHT:  I didn‘t shoot once in that direction. 

SIMPSON:  Pellets fell on my house.  I‘m filming you. 

KNIGHT:  Do whatever you want.  You swore.  You cussed. 

SIMPSON:  That‘s exactly what I said.  I‘m asking you now to move down so the pellets don‘t land on my house again. 

KNIGHT:  You ask us politely, I‘ll be glad to do it. 

SIMPSON:  Don‘t move the gun towards me again. 

KNIGHT:  I did not shoot once!

SIMPSON:  Do not move the gun towards me again. 

KNIGHT:  Nobody moved a gun towards you. 

SIMPSON:  It‘s on film.  Don‘t do it again.  I‘m asking you now to move.  How would you like for pellets to land on your house? 

KNIGHT:  Fifteen times—why don‘t you go?  We heard you.  We‘re here legally. 

SIMPSON:  Move down away from my house. 

KNIGHT:  Go!  Go!

SIMPSON:  Move down away from my house. 

(END VIDEO CLIP) 

OLBERMANN:  The actual standoff, more than five minutes of it, ended peacefully.  But the Associated Press reports two people have complained in the last month about being hit by Knight‘s buckshot.  Knight, who has never once been wrong about anything, calls it ridiculous. 

The miracle of marketing—honestly, I‘m put off any time I see someone on TV selling their own book.  But what you‘ve done about the Special Comments book “Truth and Consequences” continues to astound me.  In two days it‘s gone from about number 12,000 on the Amazon sales list to number 198.  It‘s number two on its movers and shakers list, number two in sales among all journalism books, number two among all American political books, number one among all books among American presidents.  Stop it, you‘re embarrassing me.  No, don‘t. 

You thought the idea that Paris Hilton had adopted rampaging drunken elephants as a cause was too stupid even for her?  Evidently not.  That‘s ahead, but first time for COUNTDOWN‘s worst persons in the world. 

The bronze to Pat Robertson, the televangelist Rudy Giuliani supporter, asked by a viewer yesterday about the Christian view of Yoga.  Does it really have its origins in evil?  Yes, it does, he answered.  Stretching is fine, but by repeating common yoga mantras, you‘re actually praying to the Hindu gods Vishnu and Krishna.  You‘re not even aware of it. 

Firstly, that‘s not evil.  That‘s just a different model of the same product you‘re selling.  Secondly, if you think the mantras violate your brand of religion, then don‘t say the mantras, moron, just stretch!

Runner up, Senator John McCain of Arizona, trotted out his Don Rumsfeld mouse club ears during the debate last night, saying he has heard Congressman Ron Paul, quote, talk about bringing our troops home, about the war in Iraq and how it‘s failed and wanted to tell you that that kind of isolationism, sir, is what called World War II.  We allowed Hitler to come to power with that kind of attitude, isolationism and appeasement. 

Here is a hint to Senator McCain and Tom Tancredo and Bush and Cheney, and all the others attempted to invoke Hitler again, the crowd booed McCain when he did it.  The crowd at a Republican debate booed not Ron Paul, not Adolf Hitler, but John McCain. 

Our winner?  Bill-O, reveling in a decision by the city council of Ft.

Collins, Colorado to continue funding public Christmas decorations.  O‘Reilly again having his annual delusion known as defending Kris Kringle in the War on Christmas has now cited this as a great victory!  Defending Christmas, brought to you by the guy who said on the air he thought Christ lived 5,000 years ago. 

Bill, wait, that‘s why they call it Christmas O‘Reilly, today‘s Worst Person in the World. 

(COMMERCIAL BREAK)

OLBERMANN:  As we indicated to you earlier in this newscast, the next Democratic debate had been canceled.  That would have been the next Democratic scheduled televised debate had been canceled, because many of the participants did not want to cross picket lines at CBS.  The next scheduled Democratic debate is next Tuesday from Iowa, a radio debate on National Public Radio in the afternoon.  So, our apologies for that and the correction now stands. 

To our number one story on the COUNTDOWN.  There are those who must face the elephant in the room and then there are those who must confront the story that they are helping the drunken elephants in the room.  That‘s what Paris Hilton recently did, after having read the news that concerned her most, the news about Paris Hilton.  But, in our number one story, even that far exceeds the reading list of Britney Spears, evidently, who raced wildly through a Barnes and Noble, like a rampaging elephant, so she could get a cup of coffee. 

First, on the Ellen Degeneres show, Miss Hilton personally addressed the story that she had taken up the cause of drunken elephants in India, a report that was retracted the same day it came out.  The underlying story was true.  A bunch of elephants had consumed rice beer on a farm in India and gone on a rampage.  But Miss Hilton was giddily immune to knowledge outside her own orbit. 

(BEGIN VIDEO CLIP)

PARIS HILTON, “THE SIMPLE LIFE”:  I heard that‘s true.  I‘m like, how would an elephant get alcohol in the first place?  Why would I talk about that?  Why would I care if an elephant got drunk?  Can an elephant get drunk?  I‘ve never talked about that in my life. 

ELLEN DEGENERES, “ELLEN”:  You‘ve never heard about it, you never nothing?   

HILTON:  No, I never even knew an elephant can get drunk.  I don‘t think they can still. 

(END VIDEO CLIP)

OLBERMANN:  As for Miss Spears, one would have thought she was mad to research some topic of global importance whipping through those book shelves.  Look at her go.  Was she there, at least, to pick up a good novel or even a children‘s book?  No, screw the literature.  There‘s coffee and coffee specials.  Spears ducked into Starbucks kitchen while her order was prepared.  Looks like an iced Mocha Choco Latte, possibly a venti skim chai.  We‘re sending correspondent Trisha Tockanowa (ph) and live truck to the scene to follow up.

Both Spears and her beverage well protected by eight L.A. police officers according to TMZ.com.  At this point, let‘s turn to “Village Voice” columnist Michael Musto.  Michael, good evening. 

MICHAEL MUSTO, “VILLAGE VOICE”:  Hi, Keith. 

OLBERMANN:  Coffee in a moment, first elephants.  Paris Hilton dismissed the plight of those drunken elephants and, in fact, she‘s even denied the existence of that problem.  Is her lack of elephant knowledge an aberration or is it emblematic of a larger societal problem? 

MUSTO:  It‘s emblematic.  I think the whole world needs to know the plight of alcoholic elephants, drug addicted giraffes, wildebeests with ADD.  Here‘s a side bar, Keith.  This whole thing started with Ellen.  The elephants belonged to Ellen, but they didn‘t get along with her cat, so she gave it to her hairdresser friend.  The agency moved in.  Please bring the elephants back. 

OLBERMANN:  One of her friends in India who owns a rice farm.  Ellen Degeneres read the quotes that had been reportedly uttered by Hilton.  They were false ones.  And Paris Hilton laughed, saying, they always put words in my mouth all over the press all the time.  She is right about this.  The words—press should not put words in—I know where you‘re going to go with this.  The press should not put words in her mouth. 

MUSTO:  I‘m going right there, Keith.  We only put things in her mouth to dislodge other things that shouldn‘t be there.  We don‘t need to make up quotes.  She‘s right.  The real quotes from Paris are good enough, like Wal-Mart sells walls, and I didn‘t like jail.  It wasn‘t too cool.  The best one was the Bible is my new favorite book.  It‘s even better than Cosmopolitan. 

OLBERMANN:  On this whole issue of focusing on drunk elephants, how is she supposed to do that when she‘s still trying to get down to Rwanda to help the kids? 

MUSTO:  Rwanda is where a lot of elephants happen to be.  If Paris ever does get there, which I doubt, she‘s going to have a lot of open bar parties in her honor.  It‘s only going to escalate the problem.  I suggest she stay in Beverly Hills, where the biggest problem is Kelly Clarkson had one too many Fudgesicles. 

OLBERMANN:  Or Britney Spears was rampaging through a book store.  Turning to her, are we being too hard on her as well?  She was running through the book store because the paparazzi was chasing her.  If they weren‘t there, she would be thumbing through at least Tolkien, right? 

MUSTO:  She was on rice beer.  No this is a pattern, Keith.  She recently went into a library for a place to sit down, stopped by the university for the soda machine.  I hear she actually recently visited Anne Frank‘s house because she heard there was a really cool bathroom in the attic.  Don‘t blame the paparazzi. 

OLBERMANN:  OK, I‘m not even going to go with the joke that pops into my head. 

MUSTO:  Something about the blog of Anne Frank? 

OLBERMANN:  No, no, no.  There was something yesterday about her being pregnant again and the producer was the father and all the rest of this.  And the blackberry message from him, they‘re saying Britney‘s pregnant and you‘re the father.  His replies were it‘s true.  Is that, it‘s true, another hanger on wants to make some money off Britney Spears or that it‘s actually true. 

MUSTO:  I think it‘s true that she‘s pregnant again.  She needs a new kid to make up for the ones she‘s losing.  And now she has had a dry run at being a mother.  She knows better what to do, which basically involves, when you go to Chuck E. Cheese, you ask for the sauce on the side. 

OLBERMANN:  Lastly, this poll of children, ages two through 17 -- we don‘t know how they polled the two-year-olds—the yearly question, who topped the naughty list, Spears and Hilton, number one and two, ahead of the Grinch and Darth Vader.  What do the Grinch and Darth Vader need to get back on top? 

MUSTO:  The Grinch is doing great with that rotten Broadway Show.  He and Darth need to do a comatose performance on the VMAs or drive drunk without a license.  Even bin Laden can get on the top ten if he comes out of the cave and stars in Repo the Genetic Opera. 

OLBERMANN:  The one and only Michael Musto of the “Village Voice,” great thanks.  That‘s COUNTDOWN for this, the 1,674th day since the declaration of mission accomplished in Iraq.  From New York, I‘m Keith Olbermann, good night and good luck.

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

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