updated 1/3/2008 12:05:01 PM ET 2008-01-03T17:05:01

Guests: Jonathan Turley, Michael Musto, Eugene Robinson

KEITH OLBERMANN, HOST: Which of these stories will you be talking about tomorrow?

Iowa—and the key could be Dennis Kucinich telling his supporters who to caucus for as second choice in a contest tight enough to have three winners.

While the Republican flavor of the month leaves Iowa the night before the caucuses to appear on “The Tonight Show”.

Nearly two years after the first candidate announced, a year since the heavy hitters declared, somebody somewhere finally votes—but not before a final assault of TV ads that make the commercials during the Super Bowl look like graffiti.

Two minutes in the middle of every nightly newscast in every Iowa city.

(BEGIN VIDEO CLIP FROM HILLARY CLINTON FOR PRESIDENT CAMPAIGN AD)

SEN. HILLARY RODHAM CLINTON (D), PRESIDENTIAL CANDIDATE: I‘ll work my heart out to bring the country we love the new beginning it needs.

(END VIDEO CLIP)

OLBERMANN: Two minutes in the middle of every nightly newscast in nearly every Iowa city.

(BEGIN VIDEO CLIP FROM BARACK OBAMA FOR PRESIDENT CAMPAIGN AD)

SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: I‘m running to finally solve problems we talk about year after year after year.

(END VIDEO CLIP)

OLBERMANN: And a totally different approach from the third of what might be three equals.

(BEGIN VIDEO CLIP FROM EDWARDS FOR PRESIDENT CAMPAIGN AD)

DOUG BISHOP OF BAXTER, IOWA: I was laid off September of 2004. And I was asked, would you and your family like to come up and meet Senator Edwards.

(END VIDEO CLIP)

OLBERMANN: The Republicans bring out the long knives. Romney attacks Huckabee. Huckabee attacks Romney. McCain attacks Romney.

(BEGIN VIDEO CLIP FROM MITT ROMNEY FOR PRESIDENT CAMPAIGN AD)

MITT ROMNEY ®, PRESIDENTIAL CANDIDATE: If we want somebody who has a lot of experience in foreign policy, we can simply go to the State Department.

(END VIDEO CLIP)

OLBERMANN: And if we want to know who wins in Iowa, do we simply go to the online gamblers?

It is obstruction—the Republican and Democratic co-chairs of the 9/11 Commission blast the CIA for never telling them about the torture tapes. And the attorney general opens a criminal investigation into their destruction.

And Iowa has its big three, so does Hollywood. She makes out with three guys in 24 hours in Capri. She has a drink and a smooch with her ex—and with her ex.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: No, not him.

(END VIDEO CLIP)

OLBERMANN: All that and more now on COUNTDOWN.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Sometimes I‘m a bad boy, yes.

(END VIDEO CLIP)

OLBERMANN: Good evening.

This is Wednesday, January 2nd -- 307 days until the 2008 presidential election, the night before the Iowa caucuses. Iowa, consisting of 1/100th of the nation‘s population, an estimated 6 percent of whom will caucus tomorrow, meaning the first milestone of the campaign to elect the 44th president will be determined by .06 of 1 percent of the country.

In our fifth story on the COUNTDOWN, which such wrong end of the telescope proportions, it should perhaps come as no surprise that the outcome of tomorrow‘s Democratic contest could now hinge on Dennis Kucinich—the Ohio Congressman with absolutely no chance of winning the caucuses nor the nomination itself, asking his supporters to back Senator Barack Obama if he fails to meet the so-called viability voting threshold—you get at least 15 percent or you get nothing.

In 2004, Congressman Kucinich, having thrown his support in a similar manner to Senator Edwards, which helped Mr. Edwards finish second in Iowa that year.

Senator Obama with the apparent momentum tonight. According to the latest “Des Moines Register” poll, the Illinois Democrat with a lead that is double the margin of error of 3-1/2 percent. Heading into tomorrow‘s caucuses, he‘s at 32 percent, with Senators Clinton and Edwards in a statistical tie for second and 25 percent and 24 percent respectively.

I don‘t know why it says Hillary and everybody else‘s last name is there.

On the Republican side, Governor Huckabee out in front, also at 32 percent. Trailing him at 26 percent, Governor Romney. Senator McCain at 13 percent, but that number may be rising.

More on the Republican race presently with Eugene Robinson of “The Washington Post”.

First, the indecision of Democratic voters in the Hawkeye State, perhaps represented best by Susan Klopfer, the Iowa precinct captain who publicly switched her support and her lawn signs from Clinton to Obama about three weeks ago, posting a video blog on the Obama campaign Web site. Go out there and get another new sign.

Ms. Klopfer, showing up at an Edwards house party this morning, saying it was because she‘s on the verge of switching again—if not to Edwards then, perhaps to New Mexico Governor Bill Richardson.

Al Gore, if you‘re watching, you might still get an organization together in Iowa if you call Miss. Klopfer before sunrise.

The top three Democratic candidates doing their best to win over every Susan Klopfer in Iowa tonight by making last minute direct appeals during tonight‘s local newscasts in the state—two minute long saturation purchases across Iowa. Mrs. Clinton, by promising a new beginning, if not a new diet.

(BEGIN VIDEO CLIP FROM HILLARY CLINTON FOR PRESIDENT CAMPAIGN AD)

CLINTON: As we start this new year, America is at a crossroads. We‘re a nation at war in a dangerous world. We have a faltering economy, an energy crisis and 47 million people without health care. But after seven long years of this administration, we finally have the opportunity for a new beginning. Tomorrow, you can take the first step. After all the town meetings, the pie and coffee it comes down to this.

(END VIDEO CLIP)

OLBERMANN: Mr. Obama in his almost saturation eve of caucus two minute commercial, sticking with his theme that has made him a contender, promising a new direction.

(BEGIN VIDEO CLIP FROM BARACK OBAMA FOR PRESIDENT CAMPAIGN AD)

OBAMA: Tomorrow, we‘ll come to the end of a 10 month journey. You‘ve heard from all of us and read our plans. You‘ve been bombarded with mailings and phone calls. And you‘ll be glad to know this is one of the last times you‘ll hear me say I‘m Barack Obama and I approved this message.

But the question you have to ask yourself when you walk into that caucus tomorrow is this—who can take us in a fundamentally new direction?

I‘m running to finally solve problems we talk about year after year after year—to end the division, the obscene influence of lobbyists, and the politics that value scoring points over making progress. We can‘t afford more of that—not this year, not now.

(END VIDEO CLIP)

OLBERMANN: Former Senator Edwards, meanwhile, taking perhaps the most radical approach, deciding his candidacy would best be served at the last moment if he did not appear in his direct appeal at all.

(BEGIN VIDEO CLIP FROM EDWARDS FOR PRESIDENT CAMPAIGN AD)

BAXTER: I myself, as a former Maytag employee, I was laid off September of 2004. And I was asked, would you and your family like to come up and meet Senator Edwards. And this is something I‘ll never forget. He grabbed my 7-year-old son by the hand. He dropped to one knee and he looked him straight in the eye and he said, “I‘m going to keep fighting for your daddy‘s job, I promise you that.” You know, that stuff sticks with you. That‘s the kind of things we need in a leader in this country—not somebody that‘s going to go to a big fundraiser and say write me a check for $2,300 and I‘ll let you know you have my support. I want a guy that‘s going to sit down and look a 7-year-old kid in the eye have tell him I‘m going to fight for your dad‘s job.

(END VIDEO CLIP)

OLBERMANN: Let‘s turn to our correspondent, David Schuster, who‘s covering the action in Des Moines tonight—David, good evening.

DAVID SHUSTER, MSNBC CORRESPONDENT: Good evening, Keith.

OLBERMANN: The key phrase in that Kucinich news release asking his supporters to back Obama is the clause that says “if he does not make the 15 percent threshold.”

Review that rule off the top for those who might not be familiar with it or who think they are and need a clever way to avoid actually coming out and asking what it means and why it‘s so important.

SHUSTER: Well, it just applies to the Democratic caucuses. There are 1,800 precincts across the state, so 1,800 places tomorrow night where people will be standing for a particular candidate. If in one of the precincts, for example, Keith, Dennis Kucinich were to get just 14 people standing for him, he would not reach that magic 15 percent viability in order to essentially make it to the next round.

So what the Kucinich caucus goers would have to do is they would have to convince somebody else—one of the other 86 at the particular precinct—to join them or they would then have to go to a second choice. The original intent was to try to make sure that the results were not so dispersed that there were not clear results, but essentially to have the Iowa Democrats register some preferences—some clear preferences. And that is what happens when you eliminate candidates who do not reach the 15 percent in every precinct.

OLBERMANN: So that begs the obvious question that if Kucinich has already done this and essentially thrown, provisionally, his support to Obama, what about the other ones who are less than likely to get 15 percent on the first ballot tomorrow?

Is there jockeying underway—negotiating?

Are people buying and selling 200 votes at a time in Iowa?

SHUSTER: Yes, absolutely, Keith. And that‘s why you‘ve heard—even, for example, there was Joe Biden criticizing Hillary Clinton for some statements she made about Pakistan. And yet the Clinton campaign went out of its way to praise Joe Biden and say nice things about him and Chris Dodd and Bill Richardson, with the understanding that there might be some precincts around the state where Joe Biden will not reach the magic 15 percent, where Clinton wants to be the second choice.

And that‘s where John Edwards may have something of an advantage, because in the latest polls, when Iowa Democrats were asked OK, who‘s your second choice—never mind your first—John Edwards would then come out ahead. So you hear the Edwards campaign, Obama, Hillary Clinton saying all these nice things about people who are still taking shots at them, with the hope that these frontrunners can then appeal on the second round and thereby boost their percentage tomorrow night.

OLBERMANN: Tim Russert said tonight on “NIGHTLY NEWS” that all of his off the record sources in the Democratic camps are saying this is so tight that their pollsters literally have no idea what‘s going to happen tomorrow.

Does that—to some degree, does that discount the value of this poll from “The Des Moines Register?”

Does that paper not have a pretty sharp track record?

SHUSTER: Well, here‘s the problem with the latest poll, and that is, it gave something like 60 percent—it predicted 60 percent would be first time caucus goers tomorrow night. That is—it was 30 percent four years ago. So a lot of people have problems with that aspect of the poll and also the aspect that suggested that 45 percent would be non-Democrat.

However, having said that, and despite all the criticism that even the Obama campaign has been registering at people who are criticizing the polls, despite all of that, “The Des Moines Register” does have a history of getting it right. If you look back at the last “Des Moines Register” poll in 2004, Kerry 26, Edwards, 23, Dean 20, Gephardt 18. The results were Kerry, Edwards, Dean and Gephardt, with the numbers boosted, Keith, largely because of the viability issue—people who were choosing Kerry, Edwards and Dean in their second round, essentially boosting their numbers.

OLBERMANN: MSNBC‘s David Schuster for us in Des Moines tonight.

And he‘ll be back for us tomorrow night.

We‘ll talk to you then, David. Thanks.

SHUSTER: Thanks, Keith.

OLBERMANN: Our own Dana Milbank pointing out in his column in “The Washington Post” this morning that in 2004 only six percent of Iowa‘s eligible voters showed up at the Democratic caucuses. Any lower, Dana noted, and voters would have been outnumbered by the thousands of journalists, campaign staffers and volunteers who had descended upon the Hawkeye State, as they do every January every four years.

Let‘s turn now to another one of those people, our own Jonathan Alter, senior editor at “Newsweek” magazine, join us, also, from Des Moines—John, good evening.

JONATHAN ALTER, MSNBC POLITICAL ANALYST: Hi, Keith.

OLBERMANN: Is it antiquated?

Is it absurd?

Is it every voter counts?

What is it, the fact that fewer than a quarter million Iowans have this, effectively, collectively shoot the starting gun in a presidential nomination process that will take nearly a year and, in some respects, has been going on for four or five years?

ALTER: Well, you know, it reminds me of “The Godfather” where they say, “This is the business we have chosen.”

(LAUGHTER)

ALTER: This is the system we have chosen—except we haven‘t chosen it. It sort of happened by accident coming out of 1972 and 1976. And we have this process now which has its advantages, because it allows for retail politics.

The voters here are extremely well-informed, so they‘re good surrogates for the larger American public. But it is passing strange that our system is such that the difference of only a couple thousand votes could make the difference in who becomes our next president. And that‘s pretty troublesome. And I think there are a lot of people in the Democratic Party who are finally ready the next time to start to look at a different system.

OLBERMANN: In the interim, given how close this seems to be, is this—is this a healthy thing that we don‘t know how this is going to turn out and it seems to be, perhaps, a three-way tie?

Has that helped the democracy or hurt the democracy?

ALTER: Well, it makes the democracy more fun, you know, for people like you and me and an awful lot of others. It doesn‘t get any better than this. We have never, in the history of the Iowa caucuses, not known who was going to win both the Democratic and Republican caucuses. Sometimes it‘s unclear on one side or the other. But—so there‘s a lot of suspense and excitement.

And Tim Russert was quite right. In my conversations today, nobody knows what‘s going to happen and anybody who says they do is B.S.ing you.

OLBERMANN: Obama, Clinton, Edwards—how close does it have to be perceived as a three-way tie?

And does a three-way tie then render Iowa meaningless?

ALTER: Well, the history of these things is that a win is a win. And there‘s a lot of effort to spin these by the camps that don‘t. But anybody who comes out of here on top is going to get a big boost. But if it is really close, you could have kind of a mush ball effect, where, in some cases, these candidates are actually clearing out tomorrow night for New Hampshire, shortly after the caucuses end.

OLBERMANN: Well, if you get 27, 26, 25, I think all—I think the people with 26 and 25 will probably be able to claim that, which leads us to the next question.

ALTER: Right.

OLBERMANN: We‘ve been talking about this for as long as there have been Democratic 2008 candidates.

Is there actual blood being drawn among them here or—at least in terms of their supporters?

ALTER: Yes.

OLBERMANN: Is there vitriol or no vitriol?

Are people—does it seem like a majority of the Democrats, at least, would be happy to see their second choice get the majority of support from the caucuses?

ALTER: Yes. Among the voters, there‘s no blood being drawn because, unlike the Republicans, the Democrats are really happy with their candidates. But in the scrum between the campaigns, it‘s getting pretty hot. And if this thing stays close and goes on to these next primaries, I think you‘re going to see a war within the Democratic Party.

OLBERMANN: They can follow the lead of the Republicans, a subject we‘ll get to in a moment.

Jonathan Alter of “Newsweek” and MSNBC, a pleasure, sir. Thanks for some of your time tonight.

ALTER: Thanks, Keith.

OLBERMANN: All right.

However, if you‘ve had enough of all this balloon juice and you just want to know the outcome now, there‘s the Intrade futures exchange—the Irish-based online wagering site which offers contracts to betters based on who they think will win the nominations, the primaries, the election—with the reminder that the percentages represent how confident the gamblers think an individual candidate is going to win—not by how much they would win.

Obama is the favorite in the Iowa caucuses tomorrow by 46.2 percent; 32.9 percent for Clinton, though she is the huge favorite among these betters for the nomination. It‘s 21 percent for Edwards.

Betting on the Republicans in Iowa, Huckabee in a cakewalk, 70 percent; Romney at 35.1 percent; yet Giuliani is still the gambler‘s favorite for the nomination, narrowly over Romney and McCain.

Clinton and McCain are the Intrade favorites in New Hampshire, by the way.

We think MSNBC is your best bet. Coverage all day from Iowa tomorrow. We‘re hoping for the first precinct reports, maybe even a call during COUNTDOWN at 8:00 Eastern, 5:00 Pacific, at which point Chris Matthews will join me for our wall to wall coverage of the—finally—first actual voting in this, the third year of the 2008 presidential race.

As the gambling suggests, the Republicans are having something of a demolition derby in Iowa. Mike Huckabee with a remarkable twofer gaffe, tonight over the TV writers‘ strike.

And, first, it‘s co-chairs slam the CIA for obstructing the 9/11 Commission, then dramatic news. Even the attorney general is investigating what laws were broken when the agency destroyed its torture tapes—waterboarding-gate.

You are watching COUNTDOWN on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: “On some great and glorious day,” wrote H.L. Mencken 88 years ago, “the plain folks of the land will reach their heart‘s desire at last and the White House will be adorned by a downright moron.”

Tonight, Governor Huckabee not only leaves Iowa on the eve of the Republican caucuses, but does so to go to L.A. to appear on “The Tonight Show,” while announcing his support for the striking writers—who unbeknownst to him, apparently, are still striking “The Tonight Show”.

We‘ll look at the Republican field in Iowa next. Don‘t wear your good shoes.

(COMMERCIAL BREAK)

OLBERMANN: Unlike the Democrats, Republicans in Iowa tomorrow cannot vote for a second choice. But also unlike the Democrats, not a lot of Republicans seem to be happy with any other Republican‘s first choice.

In our fourth story tonight, which Republican will lose least badly?

Mike Huckabee, with a remarkable double misstep tonight in Iowa. Not only was he actually to leave the state on the eve of the caucuses, to fly to Los Angeles to appear on “The Tonight Show,” but he told reporters he supported the striking TV writers and was relieved he would not to have cross a picket line—not realizing that it was “The Late Show” that reached a new contract with the writers nor that there were protesters outside “The Tonight Show” studios carrying signs reading “Huckabee Is A Scab”.

There has been other laughter—laughter of the “at” kind, not the

“with”—for his announcement Monday that he would take the high road by not airing an attack ad against Romney, after which he promptly played the attack ad for reporters.

And then there‘s today‘s report from Politico.com that Mr. Huckabee blew $150,000 -- not the $30,000 he claimed—on the aborted anti-Romney push.

All this after Huckabee reacted to the Bhutto assassination by botching his description of Pakistan‘s border and reacted to the National Intelligence Estimate on Iran first by admitting he had no clue about the NIE, then falsely claiming he only had a few hours to learn about it, then telling Iowa‘s “Quad-City Times” that he couldn‘t keep up with the NIE or the latest Britney Spears news because of his tough campaign schedule, despite the fact that Huckabee had displayed considerable mastery of the subject when he was asked two weeks ago about the pregnancy of Britney Spears‘ sister.

On that note, we‘ll turn to “Washington Post” columnist and associate editor, Eugene Robinson.

Gene, thanks for your time tonight.

EUGENE ROBINSON, “WASHINGTON POST”: Good to be here, Keith.

OLBERMANN: Lord help us if we start electing or not electing presidents based on their Britney Spears I.Q. But the thing with the talk show gaffe tonight—which is—that‘s going to make great photographs—the stuff with the NIE, isn‘t the problem really the one here—not that it makes a candidate look uninformed on a given issue, but that it marks this candidate as the guy who either does—will not ask anybody around him to check something like that out or doesn‘t have anybody to ask?

ROBINSON: Yes, the question about Huckabee is becoming is this guy ready for primetime?

I mean somebody ought to tell him about this newfangled thing called the Internet, where you can, you know, learn all sorts of news that‘s going on or newspapers, say, he might want to read and catch up on things like the National Intelligence Estimate. You know, one of these gaffes is one thing, but the succession of incidents in which he is misinformed, ill-informed, just plain clueless, it has got to make people ask questions.

I was out in Iowa over the weekend and people did ask questions about Huckabee. And certainly Democrats were laughing. But Republicans were asking questions, as well, about whether this guy is ready to be even considered as a president.

OLBERMANN: The non, non-ad that blasted Romney‘s record in Massachusetts included that damning phrase “no executions.” And, obviously, Romney has got to be just terrified about that.

McCain, on the other hand, is now standing by his anti-Romney ad, which quotes Romney explaining why presidents don‘t need foreign policy experience.

Are they hitting Romney for the same reasons on different fronts or are there different motives here?

ROBINSON: Well, they‘re hitting Romney for the same reason. He‘s the guy who, for months, has been ahead in Iowa and ahead in New Hampshire. Huckabee, to have any chance at the nomination, has got to win in Iowa and, indeed, he‘s shot to the top of the polls.

But Romney is starting to come back. He‘s got to win there. And Huckabee, obviously, is not going to attack on the basis of foreign policy, since he doesn‘t seem to know anything about it. So he‘s going to use his domestic issues to go after Romney.

And McCain has to win in New Hampshire if this apparent resurrection of his campaign is to continue. He‘s doing pretty well in Iowa. He could finish third. But it‘s really about New Hampshire for him. And his positions on domestic issues are anathema to the Republican base. So he‘s got to use foreign policy as his kind of wedge against—against Romney.

So Romney gets it from both sides in both directions.

OLBERMANN: So this, then, would read to anybody who listened to what you were saying, maybe even wrote it down and made little diagrams with arrows going in different directions, that the Republicans may not realize they seem to be conducting, like I said before, a demolition derby. And every time two of their battered candidates run into each other, they each come away minus a headlight or a fender.

Who can survive that?

Do we get 1996 with them again, a kind of Bob Dole-ish candidate who‘s just out there and people go, you know, get the mirror out for him?

ROBINSON: Maybe we do. I mean the fundamental problem is that the Republican coalition that elected George W. Bush to two terms as president has not yet found a candidate who kind of sets its collective heart aflutter. It‘s certainly a candidate who appeals to more than one of the various constituency blocks in the Republican coalition. And all of these candidates have—have problems. And so they rise and then they get chipped away and eroded and they lose a fender, as you said. And, you know, that seems to have happened to Giuliani. It seems to have happened to Romney. It seems to be happening now to Huckabee.

John McCain at least has been around. A lot of people don‘t like him. Some people love him. But we know who he is. And I think as this process goes on, it only helps McCain, who is a known quantity.

OLBERMANN: And Newt Gingrich, who‘s sitting in his castle rubbing his hands together saying closer, closer.

Eugene Robinson of “The Washington Post”.

As always, a pleasure.

Thanks.

ROBINSON: Great to be here, Keith.

OLBERMANN: I don‘t know if any pundits have said it yet, but evidently it‘s literally true. Senator Barack Obama is like BUTA (ph). We‘ll explain this.

And, as ever, we‘ll try to explain this—Paris Hilton linked to exes of Britney Spears and Anna Nicole Smith.

But first in the news breaking in the administration‘s 50 other scandals, Bushed. Number three, FEMA-gate. The agency‘s administrator of Gulf Coast recovery, Gil Jamison, will retire Thursday after two years of public service that was both tireless and pointless.

Retire from what?

This is the big break for old kill.

What?

Number two, the Iraq War. You remember the Iraq War. Ten more Iraqis dead there in a suicide bombing today—possibly conducted by a woman. Thirty-two dead Monday in a bombing at a funeral.

Didn‘t anybody tell those dead Iraqis that the surge worked?

And number one, Dick Cheney Energy Task Force Gate. Ahead of all projections and schedules and under budget—their budget, not your budget. They‘ve done it. The price of light sweet crude oil today hit $100 a barrel and a mighty roar went up from the crowd.

(BEGIN AUDIO CLIP FROM “ROLL OUT THE BARREL”)

(COMMERCIAL BREAK)

KEITH OLBERMANN, HOST:  Not to say our political system has changed and changed for the worse but, it was on another January 2nd that John Fitzgerald Kennedy first announced he would seek the Democratic presidential nomination for 1960.  He declared this on January 2nd, 1960 -- back in the days when you could still start and finish a campaign in the same year.  On that nostalgic note, let‘s play “Oddball.”

We begin in China: with the Beijing Olympics just a few months away—on NBC—China has decided to dedicate one of its state-run TV channels to nothing but Olympic-related coverage.  This is cell phone footage of the Chinese sportscaster Zhang Bin(ph), on the left, attempting to announce the launch of the channel just as his wife interrupts him, steals the podium, and tells China her husband is cheating on her.  Oops.  Whose way? Also a Chinese TV sportscaster, on the right, outed her husband saying today, quote, “Today is a special day for the Olympic channel and a special day for Mr. Zhang Bin because, just two hours ago, I found out that besides me, Mr. Zhang Bin has been maintaining an improper relationship with another woman.”  9.4, 9.5, ooh, an 8.2 from the German judge. 

To Pasadena, yesterday‘s 119th Annual Tournament Of Roses Parade, this is the Honda float.  As you can see, it begins the parade as an average pick-up truck made from yellow carnations, and then it‘s a scene out of “Animal House.” In mid-parade, a transformation of a flying rocket-propelled, Azimo the Robot-piloted spaceship.  The hood of the car opened up into a cockpit, the doors turned into wings, the tailpipe transformed into a flame-throwing rocket boosters—everything but the gizzards made out of flowers.  Besides winning “Oddball‘s” praise, the float took home an award for its inventiveness and then managed to score a touchdown against the University of Illinois at the Rose Bowl game.

Finally to Toledo, in Iowa, and if you‘re wondering what‘s behind the recent surge in the polls for Barack Obama, look no further, this is a butter Obama bust, and it‘s the work of Iowa native Norma Lyons.  She says she tried to present Obama with the sculpture at a town hall meeting last week but she never connected with the senator.  As for the accuracy of the Obama bust, experts say the likeness is somewhat off but is still within the margarine of error.

Waterboarding-gate, back with a vengeance.  The attorney-general appoints a prosecutor.  And the only prosecution she faces is from the dating police.  24 hours, three guys?  These stories ahead but first, time for COUNTDOWN‘s top three “Best Persons in the World”.  Number three, best excuse to the cops: police questioning a driver in Washington after he hit a light pole, asked what caused the accident, the non-inebriated man responded, “pterodactyl.”  The driver was born 29 years ago.  The giant-winged reptile died off 65 million years ago.

Number two, best timing: Becky and Kyle Armstrong.  Their son Caden was the first baby born in Gettysburg, Pennsylvania, in 2007.  Their daughter, Faith, the first baby born in Gettysburg, Pennsylvania, in 2008.  So what?  Every year, on April 1st at their house, you hear, “Okaaaaaaay, now.” 

And number one, best dumb criminal: Adam Grennan of Hall, Massachusetts.  Accused of robbing a bank in Dorchester, outside Boston, handing a note to the teller, demanding a large cache of bills and no funny money, wearing a hooded parka and a scarf that cored his face, eyes included, evidently, since Mr. Grennan never noticed Boston Police Officer Camille(ph) Pritchard standing right next to him in the bank line.  

(COMMERCIAL BREAK)

OLBERMANN:  On the day before the first electoral test of 2008, when all eyes are on Iowa, comes a last-minute reminder of just why the election that formally begins tomorrow in Davenport and Sioux City and Winterset and Council Bluffs is so important.  Our third story on the COUNTDOWN, the opening of an official criminal investigation into waterboarding-gate, the destruction of the CIA interrogation torture tapes—tapes that included torture that were hidden from the 9/11 Commission, that at least three senior White House lawyers knew about and talked about, including the vice president‘s current chief of staff and the former Attorney-General, Alberto Gonzales. 

It is his successor, Michael Mukasey, who today officially announced a full criminal probe into the destruction, recusing the regulars and appointing not a special counsel, but the First Assistant U. S. Attorney, John Durham, from Connecticut, to investigate the case as acting U. S. Attorney for the Eastern District of Virginia.  He‘ll report back to the Department of Justice.  The inquiry coming as the chairman and vice-chairman of the 9/11 Commission accused the CIA and the White House of deliberately hamstringing their investigation by refusing to disclose the existence of the tapes despite repeated requests for all interrogation material.  They wrote a joint op-ed, a Democrat and a Republican in this morning‘s “New York Times” reading, quote, “as a legal matter, it is not up to us to examine the CIA‘s failure to disclose the existence of these tapes.  That is for others.  What we do know is that government officials decided not to inform a lawfully constituted body created by Congress and the president, to investigate one of the greatest tragedies to confront this country.  We call that obstruction.” 

I‘m joined now by Jonathan Turley, constitutional law professor at George Washington University.  Jon, as always, great thanks for your time tonight. 

JONATHAN TURLEY, CONSTITUTIONAL LAW PROFESSOR, GEORGE WASHING UNIVERSITY:  Thanks, Keith. 

OLBERMANN:  Mr. Kean, Mr. Hamilton referenced at least one of the possible charges in this case—obstruction, in particular, obstruction of justice.  What other possible charges should this inquiry be looking into?

TURLEY:  Well, it‘s a considerable list.  There‘s at least six that made compelling—there‘s a compelling basis for at least six.  You‘ve got obstruction of congress, obstruction of justice, you have perjury, conspiracy, I think, a spoliation.  There‘s also a chance you might have false statements, so the list gets longer.  But the original one is torture.  You know, many people in Congress and in the White House and at the Justice Department are framing this as an obstruction investigation, as if what‘s on those tapes is an episode of Barney.  What‘s on those tapes is the original crime in the scandal.  And that‘s the crime of torturing people.  It is still, even after the last seven years, a crime to torture suspects. 

OLBERMANN:  How many branches of government could the Department of Justice investigation involve and could the Department limit the investigation to just the CIA or cancel it altogether if it gets too close to the White House?

TURLEY:  Well, Keith, that‘s the problem with the fact that we don‘t have someone independent.  They went out and they selected someone within their own ranks.  The investigation will essentially be the Justice Department investigating itself because, on that list of agencies that you are talking about, one of the agencies is likely to be the Justice Department.  There‘s also the CIA.  Obviously, the White House is involved.  The intelligence agencies are involved. The national intelligence director‘s office is involved.  The National Security Council is involved.  It‘s a very considerable list.  But you can‘t ignore the fact that the Justice Department itself is involved. 

OLBERMANN:  Does the appointment of this outside prosecutor from Connecticut mitigate that to any degree, or is that dressing unnecessary dressing here that really should not redound to the Attorney-General‘s credit?

TURLEY:  It‘s completely cosmetic.  If this was a law firm, this would be like saying, the Turley law firm has a conflict of interest, so I‘m going to have one of my out-of-town offices conduct the investigation.  Picking some guy in Connecticut or Cincinnati or Delaware or any other state doesn‘t make any difference.  His boss is Michael Mukasey.  And Michael Mukasey‘s boss is the president of the United States.  And if torture occurred, he was the guy who ordered it.  So this doesn‘t help a conflict of interest at all.  And so what most of us wanted was someone independent to come in, somebody who is not within this line of—this chain of command—to investigate these things independently, but nobody seriously wants that.  And I‘m not talking about just Republicans.  This investigation now involves a range of crimes and a number of people that make it more serious than what originally triggered Watergate.  And I can‘t imagine a case for a better call for a special counsel. 

OLBERMANN:  Is there a way the way it‘s constituted now could still lead to criminal culpability for the president?

TURLEY:  Most certainly it can.  That original crime could only have been ordered by the president.  It leads directly to his office.  And that‘s the concern about the justice department.  They can narrow this, define it in a way to avoid torture.  You‘ve already seen this happen.  Play back all the tapes of the leaders in Congress, the White House and Justice Department, and notice that they rarely use the word “torture.” and nobody in this town wants to talk about it because they know that there‘s a lot of people in the country that like the idea of torturing these people.  And that‘s just a painful fact.  But it‘s also a painful fact that it‘s a crime.  And when the president says that we‘ve got some useful evidence, I don‘t know if that‘s true or not.  But it‘s immaterial.  Just because it had good results or good motivation, it remains a crime. 

OLBERMANN:  Jonathan Turley of George Washington University with a constitutional fact check of great importance to all of us.  Great thanks, Jon. 

TURLEY:  Thanks, Keith.

OLBERMANN:  Another of the great legal issues of our times.  If Britney Spears lets one of the paparazzi stay over in her hotel room, is he still a paparazzo or a boudoir photographer?

And, perhaps, you cheered when you heard Bill Kristol was going to write in “The New York Times” thinking he was great in “Forget Paris”.  Well, different Bill Kristol.  This will be a topic of some discussion in “Worst Persons”, ahead on COUNTDOWN.

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OLBERMANN:  Eddie Murphy marries Babyface‘s ex-wife.  Paris Hilton is seen with Britney Spears‘ ex-husband and Anna Nicole Smith‘s child‘s father.  You thought the caucuses were fun.  And in “Worst,” the government official who doesn‘t know about the smoking ban he‘s supposed to enforce versus “The New York Times” versus the right wing extremist who accuses proponents of sex ed of making money off teenagers‘ abortions.  That‘s next.  This is COUNTDOWN.          

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OLBERMANN:  Number two story on the COUNTDOWN, “Keeping Tabs” wherein Paul McCartney greets the new year by saying good-bye to the old and saying hello to the old.  The acrimony with his estranged wife Heather Mills marches on.  It‘s now coming to life Sir Paul had secret heart surgery last year according to “The Times of London”, a coronary angioplasty to allow greater arterial blood flow for possible stress-reducing factors.  McCartney and Mills were at it again over Christmas with the handover of their 4-year-old daughter, Beatrice.  Ms. Mills reportedly accused McCartney of spending too much on the girl.  Mills complained that the still unsettled divorce was putting her under financial pressure and yet, the UPI reports, that Ms. Mills‘ threw a New Year‘s  eve bash costing $60,000, including $30,000 for fireworks.  Like she needs to pay for fireworks.

Well, then, to happier future ex-wife news, Eddie Murphy has re-married, and San Francisco‘s bachelor Mayor Gavin Newsom is engaged.  Mr. Murphy tied the knot with film producer Tracy Edmonds yesterday, ex of Babyface.  The nuptials took place at sunset on a private island off Bora-Bora.

And in Hawaii, Mayor Newsom proposed to actress Jennifer Siebel and she accepted, according to a friend of the couple.  It will be his second marriage.  We had some trouble remembering it was Newsom who admitted to an affair with his best friend‘s wife.  Murphy was the one who picked up a free op transsexual on Santa Monica Boulevard at quarter to 5:00 in the morning.

And now, the first 15-seconds self-promoting self-indulgence of the new year: a week after the official date of publication, the special comments book,  “Truth and Consequences”, today went into a third printing.  So collect the whole set.  One from each edition. 

Which is ickier: Paris Hilton smooching Kevin Federline or Paris Hilton smooching Larry Birkhead?

That‘s ahead but first, time for COUNTDOWN‘s “World Persons in the World”.  The bronze to Antonio Nu¤ez, president of the Food Standards Agency of the nation of Portugal seen ringing in the new year in a casino on the outskirts of Lisbon by lighting up a cigar.  Senor Nunez was advised that a couple hours earlier a new national law had gone into effect in Portugal banning smoking in public places.  Not only had he violated the law on its first day on the books, but the government agency Nu¤ez leads is, in fact, the one responsible for enforcing the new law.

Runners-up: “The New York Times”.  That‘s right, they‘ve gone and done it.  They‘ve hired William Kristol of Fox Noise, the weekly standard, until they got rid of him, “Time” magazine as a columnist.  It‘s the same Bill Kristol who once praised Pres. Bush‘s second inaugural address without ever mentioning he had consulted on the writing of Pres. Bush‘s second inaugural address.  And it‘s the same Bill Kristol who, in 2006 after “The Times” detailed the use of international banking records to track alleged terrorists said, quote, “I think it is an open question whether “The Times” itself should be prosecuted for its totally gratuitous revealing of an on-going secret classified program that is part of the war on terror.”  The “secret classified program”, of course, had been posted for months on a public website of one of the companies doing the tracing of the banking records. 

You guys at “The Times” can hire any conservative columnist you want.  Why did you pick the really dumb one?  Unless—oh, he‘s going to be your Alan Colmes?

But our winner, a woman named Wendy Wright, president of the self-styled Concerned Women for America.  Answering the complaint that those trying to address teenage sex issues by only preaching abstinence need to be teaching, say, you know, contraception, too.  Wright went on fix news and said the advocates of comprehensive sex education are trying to encourage kids to have sex because those advocates, quote, “benefit when kids end up having sexually transmitted diseases, unintended pregnancies, and they lead them into having abortions.  You have to look at the financial motives behind those promoting comprehensive sex ed.” 

And the condoms the sex educators keep trying to make available for kids, those are for what?  Water balloons?  Wright forgot to add that the educators also went into the proletarian zones and had sex with prostitutes and deliberately contracted syphilis.  You‘ve heard of Miss Wright.  This ain‘t her.  Wendy Wright.  How‘d you like to get stuck defending her at a sanity hearing? Today‘s “worst person in the world!”    

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OLBERMANN:  A personal admission to make tonight.  I‘ve always found the word “caucus” faintly obscene, particularly the verb form “to caucus.”  On that note, never mind the big three among the Democrats in Iowa, in our number one story on the COUNTDOWN, how about the big three among the Hollywood icky girls set—Britney Spears caucusing with the paparazzo in her hotel room?  Lindsay Lohan reportedly caucusing with three different men in  24 hours?  And Paris Hilton caucusing with, first, Kevin Federline and, then, Larry Birkhead. 

Start Saturday evening at a Las Vegas nightclub, Hilton bumping into Britney Spears‘ ex, Mr. Federline.  The two conversed.  Boy, that must have been a scintillating conversation.  According to “Access Hollywood”, they shared a laugh and Hilton kissed Federline on the cheek.  Later that same evening, K-Fed stopped by Hilton‘s hotel room to hang out, according to “People” magazine. And, on Sunday night, Hilton and Federline were spotted at a different Las Vegas club, downing a shot of tequila.  Just the one?  The very next night, Miss Hilton candid with Larry Birkhead, according to various reports, ringing in the new year at—where else—some Las Vegas nightclub. 

Meantime, Ms. Spears was courting her own brand new hang-around, inviting a parazzo whom she had befriended to spend time with her children and their court-appointed monitor on the first evening of 2008 -- that according to “OK!” magazine. 

Not to be forgotten, Lindsay Lohan who reportedly smooched, kissed three different men in Capri, Italy, in the course of 24 hours, one of them a waiter, garron. 

Let‘s bring in “Village Voice” columnist, Michael Musto.  Happy new year, Michael. 

MICHAEL MUSTO, COLUMNIST, VILLAGE VOICE:  Thank you, Keith.  This is more like streptococcus.

OLBERMANN:  Yes, thank you.  Help me out here: Hilton-Federline, Hilton-Birkhead.  Who‘s on first, what‘s on second?  I don‘t want to know who‘s on third?

MUSTO:  Hilton, white pages, she‘s doing it with the ex of every bimbo, whether dead or alive.  Next, she‘s going to do with Arthur Miller.  I‘m sure she‘s a big fan of his work.  Soon, all of California will be exes of a bimbo, namely, her.  It‘s sick. 

OLBERMANN:  She recently said and I missed this—I don‘t know why we didn‘t do an hour-long special on this—that she would like to find the love of her life and start a family.  Is she going to do this on the fast track here with Kevin Federline, avoid the love of your life part, go straight to the, you know, shot score every time straight to the family bit?

MUSTO:  Well, he sticks it in and you start swelling.  I mean, this guy makes Dom de Luis look impotent by comparison.  In this case, if there is a baby, God forbid, I think even Jamie Lynn Spears would say, abort it, abort it.  Oh, by the way, K-Fed and Paris are still in the hotel from New Year‘s, trying to figure out how to countdown, four, three, I don‘t know.  And interesting—another interesting fact—they were watching “Logo” with Anderson Cooper and Kathy Griffin.  Oh, that was CNN? 

OLBERMANN:  Eh, Dom de Luis is in there, somehow...

MUSTO:  Lots of great references.

OLBERMANN:  Yes, it‘s conceivable that Hilton would spend time with Federline for the sole purpose of annoying Britney Spears, correct?  I mean, with whom she‘s had this off-again-on-again friendship.  But, what would the premise here be the cozying up to Larry Birkhead?  Death wish?

MUSTO:  No, she‘s already dead.  I think she‘s just giving him some Birkhead.  Look, he‘s definitely got a type which is a kind of a woozy moronic blonde and that‘s her type, too, so it totally works.  But I really, honestly don‘t think anything‘s happening here because he would never cheat on Howard K.  Stern. 

OLBERMANN:  Let‘s quickly get back to that picture...

MUSTO:  Or Dom de Luis

OLBERMANN:  ... Of Larry Birkhead with Miss Hilton.  Miss Hilton is wearing the “I heart Hilton” dress, and tmz.com reporting that on Saturday evening she was singing “Do You Think I‘m Sexy” to the crowd.  After this quick period of good works or at least announcements about good works, is she returned to her native narcissistic language, Michael?

MUSTO:  You would think so except that Larry was wearing an I look stupid shirt.  And after she sang “Do You I‘m Sexy?”, the crowd, as it were, responded with the loudest notes since they were offered free “Fred Claus” tickets.  But she does put the “narc” in narcissism.  When she powders her nose, Paris really powders her nose. 

OLBERMANN:  And, who knows if this report in “OK!” magazine is reliable but the scene we‘re asked to believe is Britney Spears visiting with her kids and the monitor appointed by the family court judge Commissioner Gordon and this paparazzo guy, is that really the best time to have a date?

MUSTO:  Yes, well, she‘s a multi-tasker, my Britney.  Wherever she goes she brings the two kids, the monitor, and a photographer.  This way, she figures somebody will tell her next time she tries to shave her head or sing live, plus chuck a cheese, this is really a good group, this is going to rate.

OLBERMANN:  And the premise on this, perhaps, dating a paparazzo is “if you can‘t beat ‘em, join ‘em”, so to speak?

MUSTO:  Oh, talk about sleeping with the enemy, this is like Olivia de Havilland sleeping with Joan Fontaine or Hillary with anybody.  It‘s just ridiculous. 

OLBERMANN:  All right, I‘ve got an Olivia de Havilland-Joan Fontaine reference.  I‘ll close it out with Lindsay Lohan—three make-out sessions reported in 24 hours, three different guys.  Is it refreshing that her sobriety has not impeded her joie de vive?  Or, is she just figuring out that at least one of them had to have a drink and she didn‘t get a contact guy.

MUSTO:  Yes, she was sucking on her tongue a little too intensely.  But it is amazing that it‘s just an energy drink and some Altoids—that kind that gets you zingy and have you scoring anything with facial hair, short of Queen Latiffa. 

OLBERMANN:  That‘s right.  Garron, give me a kiss and a lime.  The one and only Michael Musto.  Thanks, Michael. 

MUSTO:  Thank you.

OLBERMANN:  And that‘s COUNTDOWN for this, the 1,708th day since the declaration of mission accomplished in Iraq.  From New York, I‘m Keith Olbermann.  Remember, throughout the day tomorrow, join us here for the best coverage of the Iowa caucuses.  We‘ll probably get the first results, maybe even a call of Iowa when I join you for COUNTDOWN at 8:00 Eastern, 5:00 Pacific.  Chris Matthews then joins me and we will caucus the night away with you until midnight Eastern.  That‘s tomorrow night.  For now, good night and good luck.

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

END   

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