updated 1/17/2008 11:05:36 AM ET 2008-01-17T16:05:36

Guests: Bay Buchanan, Mark McKinnon, Chip Saltsman, Steven A. Smith, Dana Milbank, Margaret Carlson

CHRIS MATTHEWS, HOST:  Looking for Mr. Goodbar.  How long will the Republican voter play the field?

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  Welcome to HARDBALL, tonight from Los Angeles, where I‘m doing the “Tonight” show with Jay Leno.

Republican candidates step right up.  Everybody‘s a winner.  Last night, Mitt Romney took Michigan, creating a incredible muddle on the Republican side.  On the Democratic side, the top three contenders debated last night in Las Vegas and agreed, apparently, not to debate, at least not harshly.  So we‘ve got a tight contest on the Democratic side.  It‘s the Republicans that look lost.

Is there no direction home for Republicans in this amazing race?  Later, with South Carolina looming, we‘ll talk Southern strategy.  And with all the focus on Hillary versus Obama, let‘s not forget John Edwards on the Democratic side.  That‘s our “Big Number” tonight.  It has to do with Edwards.  Plus, all the latest polls and advertisements in our “Politics Fix.”

But first, to the Republican muddle.  That‘s my word for it.  Huckabee took Iowa, McCain won New Hampshire, and last night, Mitt Romney—must-win Mitt—beat them both and took home Michigan.  Up next, all three are walking into South Carolina to contest that battle this Saturday night, along with Fred Thompson.

Well, check out this scenario.  Suppose it works out this way?  Long-shot candidate, son of the South Fred Thompson, does win in South Carolina this Saturday night, and in 13 days, New York mayor Rudy Giuliani‘s gamble pays off and he wins in Florida.  Everybody wins!  We got five Republican winners, therefore no big winner.

On the Democratic side, John Edwards has been forced to stand in the shade of history between two ground-breaking candidates, Barack Obama, the first African-American to win the Iowa caucuses for president, and Hillary Clinton, the first woman to win the New Hampshire primary for president.  But what if John Edwards wins Nevada on Saturday in those caucuses and wins again in South Carolina in 10 days?  Well, more on the Democrats in a moment.

We start tonight with the Republicans.  HARDBALL correspondent David Shuster is on the phone with us from South Carolina.

DAVID SHUSTER, HARDBALL CORRESPONDENT:  Well, Chris...

MATTHEWS:  Let me ask you about that battle right down there.  Go ahead, David.

SHUSTER:  Well, Chris, I mean, it starts, of course, with Mitt Romney, who came here today fresh off of his victory in Michigan.  And when he arrived here, he lowered expectations for Saturday, said he does not expect to win.  He called this state John McCain‘s state to lose.  And he portrayed the nomination fight as a war of attrition.  Watch.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R-MA), PRESIDENTIAL CANDIDATE:  I‘m looking to rack up the delegates I need to win the convention.  I like wins better than second place, and so I‘m going to be campaigning hard here in South Carolina.  I think Senator McCain has a very strong lead here.  He‘s the clear frontrunner.  It would been a enormous surprise if he were unable to win here.  I‘d like to do better than my current place, which is fourth, but even a strong fourth is better than what some of the other guys saw in Michigan last night.

(END VIDEO CLIP)

SHUSTER:  That, of course, was a reference to Fred Thompson and Rudy Giuliani.  But in Michigan and here in South Carolina, Romney has been referring to John McCain as a Washington insider, so McCain is now trying to counter that charge with this ad.  It‘s similar to an older one that highlights McCain‘s opposition to wasteful government spending, and that again that a lot of people in other places, in Iowa and New Hampshire, have seen before.

Now, on the campaign trail, Chris, McCain has been focusing on South Carolina‘s large military and veteran population.  He‘s been talking up Iraq.  He‘s been talking about the Iraq troop surge and his foreign policy experience.  And McCain has his own predictions about this primary.  Watch.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE:  I detect the same enthusiasm that we had before.  I think that people understand that Governor Romney was the native son and they supported him.  And I thought we would do better there, and we didn‘t, but I didn‘t predict victory.  I‘m saying we will win South Carolina.

(END VIDEO CLIP)

SHUSTER:  McCain and Romney are both facing a huge challenge from Mike Huckabee.  He has a large evangelical base here in South Carolina, and he‘s running hard to the right on issues like immigration and social issues.  Today, there was Mike Huckabee, taking shots at Mitt Romney‘s flip-flops on abortion.  Here it is.

(BEGIN VIDEO CLIP)

MIKE HUCKABEE (R-AR), FMR GOVERNOR, PRESIDENTIAL CANDIDATE:  I know you‘re going to read all about our biographies and what we‘ve done and where we‘ve been, and that‘s important.  And frankly, it‘s important because looking at where a person has been may give you a pretty good indication of where that person will go.  If a person has not been clear on issues like where life begins and the sanctity of human life and the need to preserve it and protect it, you may not be all that confident that the person will hold that view in 10 months or 10 years.

(END VIDEO CLIP)

SHUSTER:  Now, Chris, South Carolina is living up to its billing as a campaign that sometimes features nastiness.  There have been mailers placed on windshields across the state, mailers attacking John McCain, Mitt Romney and Mike Huckabee.  They‘ve all been targeted in some of these nasty mailers—Chris.

MATTHEWS:  Who‘s putting out the mailer that John McCain sold out when he was a POW in the Hanoi Hilton?

SHUSTER:  That is a group, or at least an individual, out of Virginia.  As near we can tell, Chris, it is not connected to any other campaign, or not Ron Paul, as some McCainiacs had suggested.  It‘s simply an individual in Virginia who said he wanted to try to make this point.  McCain was very effective, though, in coming out yesterday and calling this nonsense.  There was Orson Swindle, who served as a POW with John McCain, pointing out that, Look, John McCain is a hero, and so they‘re dealing with this very aggressively.

MATTHEWS:  Well, it looks to me like the face of evil.  Anyway, thank you very much, David Shuster.

Bay Buchanan‘s an adviser to the Romney campaign—a big victory for them last night.  Mark McKinnon is a media adviser and an expert in the media with the McCain campaign.  And on the phone from South Carolina, Chip Saltsman is Huckabee‘s campaign manager.

Let me start with Bay Buchanan.  Last night—I‘m amazed at the Republican Party, and I‘m trying to figure it out.  It‘s almost like when you and I were kids, looking through a kaleidoscope, you know, all these different fragments of glass, different colors, and trying to figure the darn thing out.  What is your party up to?  I mean, who is the national candidate?  It is Romney?  Can he run nationwide, your guy?

BAY BUCHANAN, ROMNEY CAMPAIGN ADVISER:  Absolutely.  If you watched here, and I know you have, Chris, we were strong out there in Iowa, clearly did not win but came in with a solid second.  Then in New Hampshire, did much, much better.  We really closed a 14-point gap down to 5, came in a very, very strong second.  And then now just last night, won again really big, really big, and actually won the evangelical vote.  People thought maybe Mitt wouldn‘t be able to do well there.  He beat Huckabee last night with the evangelicals.

Our message is working.  Mitt Romney has a good organization, and his message is strong in all of the states, and that‘s where we‘re playing.  We‘re not picking and choosing, we‘re going in all of them.  He is the candidate that can win the 50 states and take this nomination and take it right to the Democrats and head to the White House.

MATTHEWS:  Let me go to Mark.  You know, John McCain, is he a national Republican or simply a New Hampshire Republican?

MARK MCKINNON, MCCAIN MEDIA ADVISER:  No, I think he‘s a national Republican, Chris.  And I think it‘s interesting that Mitt Romney is lowering expectations so much for South Carolina.  As you know, I think, in almost every Republican contest, South Carolina has picked the nominee, so why is Mitt Romney, who says he‘s a national candidate, not really playing in South Carolina?  And I‘m glad that he‘s talking about how well we‘re going to do in South Carolina.  We expect to do well there and take our message of character and principle and consistency and truth telling.  Maybe he‘s not going to South Carolina because he doesn‘t have a textile worker bailout plan, like he did for Michigan.

(LAUGHTER)

BUCHANAN:  Chris—Chris, he is down there now, Mitt Romney, as you just pointed out.  He‘s down there.  He‘s fighting.  We‘re up on ads.  We are down there in South Carolina.  Obviously, we‘ve been focused entirely on Michigan for this last week.  The economy is the issue, and Mitt Romney is the candidate with an answer.  He‘s got the experience and the plans to turn this country around, not just the industries up there in Michigan but the industries in South Carolina, as well.  So there‘s no question that on issues, as well as organization, Mitt Romney‘s running the team here.

MATTHEWS:  Let‘s bring in Chip Saltsman, who‘s on the phone.  We couldn‘t get him on camera.  But let me ask Chip about this race.  It seems to me a Southern accent is helpful in South Carolina.  You and your candidate, Mike Huckabee, of course, who did well in Iowa, could do well down there, but you‘ve got Fred Thompson, another Southern guy, running.  Are you going to split the Southern vote?

CHIP SALTSMAN, HUCKABEE CAMPAIGN MANAGER:  Oh, I don‘t think so.  Governor Huckabee‘s had great crowds since he‘s been back in South Carolina from Michigan.  There‘s a lot of excitement about what we‘re doing down here.  We fully expect to do really well Saturday night.  South Carolina‘s a great state for us.  And we‘ve been competing in every state, as well.  We‘ve been outspent in every state.  We‘ve been attacked in every state.  But yet Governor Huckabee is the only candidate amongst the group that‘s been talking about the economy and the middle-class issues since the beginning of this campaign.  And I think now that you see the issues, coming around, talking about the economy, talking about jobs, a lot of people are paying attention to what Governor Huckabee‘s saying since the very beginning of this campaign.

BUCHANAN:  You know, Chris...

MATTHEWS:  If you lose to...

BUCHANAN:  ... I think...

MATTHEWS:  If you lose to Thompson—suppose Thompson wins down there.  Suppose Rudy wins in—Rudy Giuliani wins in Florida on the 29th.  The Republican Party‘s beginning to look more and more like Iraq, the war we‘re fighting.  You‘ve got the Sunni wing of your party, which is the moderates, which is Rudy and McCain.  Then you‘ve got the Shia, the Huckabees and the Thompsons.  And then you‘ve got the Kurds, your guy, Bay, the Romney candidacy, which doesn‘t quite fit in any of them.  It‘s very hard to figure out how you get a unitary government out of all this.

(CROSSTALK)

MCKINNON:  ... dream to have a brokered convention, but it‘s just not going to happen.  And as we‘ve seen in the national polls, as soon as people saw that  John McCain was once again in a viable position, we‘re seeing all the national polls, McCain is leading now, and also that he‘s the one Republican who can beat the Democrats.

(CROSSTALK)

MATTHEWS:  Bay first.  I want to go the Bay on this.  Bay, can you see any one of the three candidates, including your own, getting 50 percent of the delegates before you get to St. Paul next September—this September?

BUCHANAN:  As I said, we‘ve gotten the most votes so far.  We‘ve got the most delegates.  We have the strongest organizations in more states than anyone else.  I think there‘s a possibility on the 5th of February that this thing breaks open and it‘s clear who‘s going to be the frontrunner at that stage.

Anything can happen, as we all know.  But when it comes to issues, the American people know that Washington has failed them miserably and that  John McCain‘s just part of that failed system.  There‘s, like, a big (INAUDIBLE) deer in the headlights, looking in the headlights, Washington is.  It hasn‘t moved.  It can‘t answer these problems.  They need somebody fresh, somebody with new ideas, somebody with the energy and the will and the courage to take care of things.  That‘s Mitt Romney, whether it‘s on amnesty and illegal immigrants or if it‘s on the economy.

MATTHEWS:  Chip, does Mike Huckabee hate Washington, too?  That seems to be the theme here.

SALTSMAN:  Well, I‘ll tell you, he‘s definitely from Washington and not of Washington.  We don‘t have a lot of Washington political consultants on the campaign or maybe even coming on television speaking for us.  What we‘ve got is a lot of grass roots folks from around the country, people that believe in Governor Huckabee‘s message, and that‘s why we‘re do so well.  That‘s why we‘re going to do so well on Saturday in South Carolina, and on to Florida after that.

MCKINNON:  John McCain‘s the one guy in Washington...

MATTHEWS:  I just don‘t understand...

MCKINNON:  ... who‘s tough enough, Chris—yes, McCain‘s the one guy in Washington—

MATTHEWS:  Let me ask you all this question.  President Bush is in Washington.  He lives at the White House, at 1600 Pennsylvania Avenue.  President Reagan was president for two terms.  George Bush‘s father was president for four years.  Five of the last seven presidents of the United States have been Republicans.  In all of the years of the Republican rule, why has Washington remained the bad place, the badlands?  Mark, you first.  Why do you still run against Washington, having been leading in the country for so many of these years?

MCKINNON:  Well, I think that‘s—it‘s always popular to run against Washington, Chris.  And let me just say that John McCain is the one guy in Washington who hasn‘t been changing his positions, like these other candidates.  And he‘s the one guy who represented change by changing the Iraq strategy and supporting the surge before anybody else in the Republican field would stand up with the courage to do that.  And he‘s the guy who‘s tough enough and strong enough, has the courage to put people in jail like Jack Abramoff.  He‘s the one guy up there fighting for change.  And if he can do that as senator, imagine what he‘ll do as president.

BUCHANAN:  He‘s been fighting for change...

MATTHEWS:  Well, why is Washington so—why has Washington become Sodom and Gomorrah?

BUCHANAN:  Well, it‘s easy, Chris.  You know, I‘ve traveled this country the last couple years on the issue of illegal immigration.  I went from place to place, talked to Republicans, Democrats, did the talk radio.  I‘ve never seen an electorate angrier and more frustrated with Washington, with their government.  They have failed them.  They refuse to address key issues.

You look at John McCain.  Two years ago, he put together this enormous amnesty.  The American people said, No, we don‘t want it.  What‘s he do 12 months later?  You‘re right, he doesn‘t get it.  He brings back another amnesty.

He does—his answers are wrong for America.  He refused to move ahead with tax cuts that would help middle-class Americans.  He stopped (INAUDIBLE)  He stopped the judges.  We had a bold idea, the president did, to try to break loose the problem in the Senate and get our judges through, and who stopped it?  None other than McCain.

He doesn‘t have any answers!  He‘s yesterday!  He‘s stuck in the morass of Washington.  And if we want to break things up...

MATTHEWS:  You‘re so tough!

BUCHANAN:  ... we‘ve got to bring somebody new in!

MATTHEWS:  Bay, you‘re so tough...

BUCHANAN:  It‘s true!

MATTHEWS:  ... on this guy.

BUCHANAN:  You know...

MATTHEWS:  It sounds like you don‘t like McCain more than you like Romney.

(CROSSTALK)

MATTHEWS:  You just talk about McCain.  I‘ve never heard anything like this.

MCKINNON:  Chris, Bay...

BUCHANAN:  Well, all that I say is true, it is not?

MCKINNON:  It‘s not.  In fact, Mitt Romney can spend his entire fortune saying that John McCain supported amnesty, and it still won‘t be true.

BUCHANAN:  Oh, my golly!  America‘s laughing at that statement!  We all know it was amnesty!  What do you think the phone calls were saying?  No amnesty!

MCKINNON:  He never supported amnesty.

BUCHANAN:  No, it was...

MCKINNON:  What we have now is de facto amnesty.

BUCHANAN:  His bill is a big, fat amnesty!  No, you have a de facto one, and that‘s because John McCain and his pals back in Washington...

MCKINNON:  If you‘re penalizing people...

BUCHANAN:  ... refuse to do anything!

MCKINNON:  ... and you‘re not giving them privileges, it‘s not amnesty.

BUCHANAN:  Oh, nonsense!  It‘s clearly—we know what it is.

MATTHEWS:  OK, can I ask, Bay Buchanan, is that your—Bay, Bay...

BUCHANAN:  Yes?

MATTHEWS:  ... I want to ask you one tough question.  And you can take a minute to answer it.

BUCHANAN:  Sure.

MATTHEWS:  Do you believe that John McCain did anything wrong as a POW that was unpatriotic?

BUCHANAN:  I have no reason to believe that whatsoever.  I do not believe it.

MATTHEWS:  OK, thank you very much.  We cleared the air on that baby!  Anyway, thank you, Chip Saltsman.  Thank you, Bay Buchanan, who is fired up, and Mark McKinnon, who‘s playing defense tonight.

And up next: On the Democrats‘ side, hold onto your bets on that one.  Will Hillary or Obama or Edwards emerge as the frontrunner by winning in Nevada and South Carolina, both coming up?

You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  The fight for the Democratic nomination is wide open, as well.  Obama took Iowa, as we all know.  Clinton took New Hampshire.  And Nevada is coming up this Saturday.  What‘s at stake out there—or rather, down there—I‘m sorry, out there, I keeping forgetting I‘m in LA right now—in the desert of Nevada.  Who‘s going to win that one?

MSNBC‘s Tucker Carlson joins us to do a nice autopsy on last night.  Tucker, I want you to give me your expert‘s opinion of some of these bites from last night.  I don‘t think it was the most exciting debate in history.  It reminded me, sort of, of Donald Trump‘s “Apprentice” show, with everybody sitting around a table.  But here they are.  Here‘s Hillary Clinton in last night‘s debate, running against Bill—I‘m sorry—running against George W. Bush.

(BEGIN VIDEO CLIP)

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE:  In this time, in this period, where we‘re going to have to repair a lot of the frayed relationships coming out of the Bush administration...

I‘ve worked very hard on the Senate Armed Services Committee to, you know, try to make up for some of the negligence that we‘ve seen from the Bush administration.

I think that there‘s a difference between what President Bush has done, which has frankly used fear as a political weapon, and a recognition...

I think we have to do everything we can to prevent President Bush from binding the hands of the next president.  You know, President Bush is over in the gulf now, begging the Saudis and others to drop the price of oil.  How pathetic!

(END VIDEO CLIP)

MATTHEWS:  You know, “pathetic”—that‘s a tough word.  That reminded me, Tucker of—remember Margaret Thatcher saying to Bush, Sr., “Don‘t go wobbly”?

TUCKER CARLSON, HOST, MSNBC “TUCKER”:  “Don‘t go wobbly.”  That‘s exactly right.

MATTHEWS:  “Pathetic”?

CARLSON:  Well, look, she...

MATTHEWS:  That just struck me as very Thatcherite right there.

CARLSON:  She is speaking to the Democratic base, which is her constituency, people who are already sold.  Keep in mind, still to this day, to this moment, the one thing all Democrats have in common, not their foreign policy views, not their social policy views, their loathing of George W. Bush.  He is the unifying force in the Democratic Party.

This is a key difference right here, this exactly the clip you just showed is the key difference between Hillary and Obama.  This is her message.  You agree with me already, come to my side.

Obama‘s message is I think more subtle than that.  You will not hear Obama say this.  He‘s a Bush fan.  He‘s not running as an ally of Bush.  He doesn‘t like Bush.  But he‘s saying, Look, even if you do like Bush, I‘m the unity guy.  Come to my side.  Moderates, liberal Republicans, come to me.  He‘s the unity candidate.  It‘s a tougher sell in a primary.  I think it‘s a more effective message in the general, should he get there.

MATTHEWS:  Yes, I couldn‘t agree with you more.  I think that‘s very smart.  it‘s very unifying.  The problem is, he has to get to be the nominee first, and Hillary...

CARLSON:  That‘s exactly right.

MATTHEWS:  ... is going on the inside rail.  She‘s going for the sure votes of the Democratic partisans, who hate Bush. 

CARLSON:  Exactly. 

MATTHEWS:  Let‘s take a look—I want you to take another look at this debate last night.

Here is a fight over what constitutes the job description—I can‘t believe we are this primitive—the job description of the president.  What it is? 

(LAUGHTER)

(BEGIN VIDEO CLIP)

TIM RUSSERT, NBC WASHINGTON BUREAU CHIEF:  Do the American people want someone in the Oval Office who is an operating officer?

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE:  Well, I think what I was describing was how I view the presidency.  Now, being president is not making sure that schedules are being run properly or the paperwork is being shuffled effectively.  It involves having a vision for where the country needs to go. 

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE:  I do think that being president is the chief executive officer.  And I respect what Barack said about setting the vision, setting the tone, bringing people together.  But I think you have to be able to manage and run the bureaucracy.

We have seen the results of a president who, frankly, failed at that. 

We saw the failures along the Gulf Coast with, you know, people who were totally incompetent and insensitive failing to help our fellow Americans. 

(END VIDEO CLIP)

MATTHEWS:  You know, she even talked cronyism with Michael Brown.

CARLSON:  Yes. 

MATTHEWS:  I mean, she—it was really an argument.  Who is right?  We need a big sweeping Franklin Roosevelt-type president or a really good nuts-and-bolts manager?

CARLSON:  Well, they are both right. 

I mean, Obama is wrong he says being president it is not just a matter of shuffling paperwork correctly.  Actually—you know this—you live here—mastering the bureaucracy is a huge part of using power.  Why is Senator Byrd so powerful?  Not just because he has been in the Senate so long, because he understands how the Senate works.

So, actually mastering bureaucracy, as Dick Cheney has shown us for seven years, really matters.  Hillary is right.

But, on a rhetorical level, that is not a powerful argument.  She is essentially saying:  I am a more effective technocrat.

Now, there‘s no question she is right about that.  I believe she is right.  She probably is a more effective a technocrat.  But that is not a message of inspiration.  And, again, that‘s I think going to be a less effective message for Democrats in November.

I‘m not shilling for Obama, but I think, if you stand back, you have got to say that, going into—this is why the senators are not elected president, because they make arguments like this, right?  Hanging around the Senate long enough, you talk like this and you don‘t get elected. 

MATTHEWS:  Right. 

And I remember that the late Daniel Patrick Moynihan saying, the reason he didn‘t run for president all those years is because, as he put it:  I have no executive skills.

How many people are that honest? 

CARLSON:  Right. 

(LAUGHTER)

(CROSSTALK)

MATTHEWS:  Here is Barack Obama attacking Hillary for exploiting fear. 

Here he is.

(BEGIN VIDEO CLIP)

OBAMA:  The tragedy in New York was a trauma to the country that it is going to take a long time for us to work out.

And Senator Clinton did good work in terms of helping the city recover.  But I have to say that when Senator Clinton uses the specter of a terrorist attack with a new prime minister during a campaign, I think that is part and parcel with what we have seen, the use of the fear of terrorism in scoring political points.  And I think that‘s a mistake.  Now, I don‘t want to perpetuate that.

(END VIDEO CLIP)

MATTHEWS:  Is that a glancing blow that he should have followed through with or not even bothered with?  I don‘t know.  What do you think, Tucker? 

CARLSON:  Well, like—both. 

I mean, like so many Obama points, it kind of falls short at the end.  It‘s not explicit enough.  It‘s too subtle.  You have the read it to really understand what he is saying. 

He is absolutely right.  She is basically using fear to attempt to win votes.  She is saying this guy is callow, inexperienced.  Who knows what would happen if he were elected?  He is right. 

Here is what I have—I notice in every campaign I have ever covered

and I have covered a lot.  Whenever you have somebody complain about attacks against him, people may agree that the attacks are unfair, but they end up believing the attacks anyway. 

It always looks like whining when you complain about being attacked, even when you are right to complain about it.  So, I am not sure that is a winning tactic for Obama.

MATTHEWS:  Right. 

CARLSON:  I think it works better for him when he sort of ignores Hillary Clinton and just continues on with the airy rhetoric, which seems to be working. 

MATTHEWS:  Why do you think they call it hardball? 

Tucker Carlson, sir, thank you very much for joining us.

CARLSON:  Thanks, Chris. 

Up next:  Michigan Republicans get it wrong?  John Edwards gets personal about himself.  And Mike Huckabee gets, well, squirrelly, literally.  We will tell you what else is going on out there in politics in just a minute.  We will give you the latest out there.

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

So, what else is new out there in politics? 

Well, Tuesday night, when the primary results were in—were in—

the Michigan Republican Party fired off an e-mail blast, declaring—quote

“In a close-fought victory, Senator John McCain succeeded again in Michigan in the Republican primary, winning over a traditionally unpredictable voter base in Michigan.”

Impressive, isn‘t it?  Only one problem; it didn‘t happen, of course.  McCain lost last night.  Romney won the Michigan primary.  A party spokesman in Michigan said—quote—“We prepared a release for either scenario.  We simply pushed the wrong button.”

Hmm. 

Speaking of John McCain, his staff worked overtime last night to thwart a nasty assault from a group in North Carolina called Vietnam Veterans Against McCain.  The group sent out a letter to newspaper editors in South Carolina claiming that McCain gave his captors information on U.S.  flight paths in exchange for better medical care after he was taken prisoner in Hanoi. 

My fellow Americans, are there really such people among us who would put out something like that? 

Anyway, John McCain spent five-and-a-half as a POW in Vietnam, refusing to leave without his fellow soldiers.  We all know that.  And, for that, he‘s a hero.  Let‘s keep it plain.  Let‘s keep it simple.  Lay off that stuff.

Anyway, the president‘s big Mideast tour continues.  If you loved the forget me not or this one from Israel...

(BEGIN VIDEO CLIP)

(MUSIC)

(END VIDEO CLIP)

MATTHEWS:  A great way to learn Hebrew—anyway, you will love this one, President Bush donning a handsome—look at this costume—a fur-lined robe as he heads to tea with Saudi Arabian King Abdullah.

Looking good.  Boy, when in Rome, huh? 

And you have heard of the freshmen 15 in college, right?  It is the idea that kids gain 15 pounds during their first year in college, all that pizza and junk food, of course.  Well, for Mike Huckabee, famous for losing 120 pounds several years ago, it was not pizza in the oven. 

(BEGIN VIDEO CLIP)

MIKE HUCKABEE ®, PRESIDENTIAL CANDIDATE:  When I was in college, we used to take a popcorn popper, because that was the only thing they would let us use in the dorms, and we would fry squirrel in popcorn poppers in our dorm room. 

JOE SCARBOROUGH, MSNBC ANCHOR:  Oh!

(LAUGHTER)

(END VIDEO CLIP)

MATTHEWS:  Is that some kind of “How you can tell I‘m a redneck” joke? 

I don‘t think so. 

And, finally, it‘s time for the HARDBALL “Big Number” tonight, as advertised.

John Edwards, who lost in Iowa, then lost in New Hampshire, showed some good signs of life, people say, in last night‘s Democratic debate in Vegas.  How did he do that?  By turning his campaign into something, well, personal. 

(BEGIN VIDEO CLIP)

JOHN EDWARDS (D), PRESIDENTIAL CANDIDATE:  I feel an enormous personal responsibility to continue to move forward. 

And this is a very personal thing for me.  It is central to this campaign, and it is a personal, personal, personal fight for me. 

And I feel that in a really personal way. 

Besides having somebody who truly understands in a personal way what‘s happening.

And it is personal to what I will do as president of the United States. 

(END VIDEO CLIP)

MATTHEWS:  You ever hear of the personals column?

Anyway, how many times did Edwards use that word “personal” last night in that one debate?  Seven different times, seven mentions of his personal fight.  Obviously, it was in the talking points—tonight‘s “Big Number.” 

Up next:  The presidential campaign heads south to South Carolina. 

Who‘s got what it takes to win down in Dixie, in the Palmetto State?

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

BERTHA COOMBS, CNBC CORRESPONDENT:  I‘m Bertha Coombs with your CNBC “Market Wrap.”

Stocks finished an up and down day on the down side—the Dow industrials dropping nearly 35 points, the S&P 500 falling seven, while the Nasdaq lost 23 points. 

Consumer prices rose a moderate three-tenths-of-a-percent in December.  And so-called core inflation—that‘s when you take out food and energy—rose just two-tenths-of-a-percent.  But, for the year, 2007 consumer prices rose more than 4 percent.  That‘s the biggest increase in 17 years.

The Federal Reserve‘s latest snapshot of the economy, called the Beige Book, showed growth slowed in late November and December, but still rose, the Beige Book released one day before Federal Reserve Chairman Ben Bernanke testifies before Congress. 

Meantime, New York Senator Charles Schumer tells CNBC Bernanke wants Congress to act quickly to pass an economic stimulus package. 

And oil prices fell, as U.S. inventories rose unexpectedly.  Crude slid just over $1 to $90.84 a barrel.

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

HARDBALL. 

MATTHEWS:  Welcome back the HARDBALL. 

Campaign ‘08, the focus now is shifting southward.  And South Carolina could play a critical role in the fates of both Republican and Democratic candidates.  So, what is at stake in the South.  And how can the Democrats and the Republicans win down there? 

We have got two experts, former Mississippi Senator—it‘s hard to believe it—former Senator Trent Lott from Mississippi, who is supporting Senator John McCain, and former—again, a big loss to the Senate—

Louisiana Senator John Breaux.

Together, they recently founded the Breaux-Lott Leadership Group, a lobbying and consulting firm.

Gentlemen, I have got to ask you privately why you left the Senate, because there must be no fun there with you guys gone. 

(LAUGHTER)

MATTHEWS:  But let‘s start with Senator Lott.  I don‘t get why you left, but let me ask you this.

This Southern fight, can John McCain, your guy, win among Southerners, among Fred Thompson of Tennessee and Huckabee of Arkansas?  Will that Southern accent be an advantage down there? 

TRENT LOTT ®, FORMER U.S. SENATOR:  Well, the McCain family original hails from Mississippi, actually, Chris.  I don‘t know if you knew that or not.  But, yes, he can win in the South.

MATTHEWS:  I didn‘t. 

LOTT:  In South Carolina, for instance, you have got a lot of veterans.  You have got a lot of military installations.  South Carolina has, I think, more service-connected people per capita than just about any other state.

But it is also a fiscally conservative state, a lot of evangelical Baptists in South Carolina.  Huckabee has an appeal there.  But I really think, in South Carolina, it is going to be between John McCain and Mike Huckabee.  And, from what I saw at the rallies I attended last week, John is probably going to have the edge in South Carolina. 

MATTHEWS:  Senator Breaux, it seems to me the Republican Party is acting like the Democratic Party this year, totally disorganized.

(LAUGHTER)

MATTHEWS:  I was suggesting—I know this is going to cause trouble, which is what I like to do.

(LAUGHTER)

MATTHEWS:  But the Sunni wing of the Republican Party has got McCain and Giuliani in it.  They are the moderates.  The more extreme people, the zealots, are Huckabee and Thompson.  And then you have got the Kurds, Romney.

I mean, who is going to put all these guys together? 

JOHN BREAUX (D), FORMER U.S. SENATOR:  Well, I am not sure they can come together.

I mean, there‘s some real divisions.  I mean, you‘re going from a Rudy Giuliani on the left, all the way to Fred Thompson, perhaps on the right.  They have got a lot of choices, and nobody has got a clear lead.

On the Democratic side, I mean, I think it is a lot more clear.  I think—I would be surprised if Obama does not win the Nevada caucuses.  The union that endorsed him, they‘re the caucus in the hotels they work in.

And, in South Carolina, I mean, John Edwards has—was born there, so I think he has the edge over there.  But then you get to Super Tuesday, and then you have got Arkansas, you have got New York, you have got California.  I think that Hillary is going to do very well on Super Tuesday.  And I think we have got a clearer idea of what is going to happen on the Democratic side. 

MATTHEWS:  Let‘s go back to the Republicans, because I love this kaleidoscopic craziness in your party, Senator Lott, because I think it was Will—what was it, Mark—not Mark Twain—Will Rogers said, I belong to no organized political party; I‘m a Democrat.

(LAUGHTER)

MATTHEWS:  That description sounds more like your party right now. 

(LAUGHTER)

LOTT:  It does.

But, you know, this is the first time in modern history where there has not been sort of an heir apparent, no vice president or president.

MATTHEWS:  Right. 

LOTT:  And, so, we have got a wide-open race going on here.

I‘m not as despondent about that as some people.  Maybe it looks disorderly or chaotic, but I would like to think of it as maybe one way you have addition.  You have got social conservatives.  You have got fiscal conservatives.  You have got national security people.  And they are supporting different people.

But, as the campaign goes forward, I think it will winnow on down.  I suspect that one more will drop out after South Carolina.  And then some people are going to have to make some tough decisions after that Super Tuesday.

And, as the field gets down to a couple, then I think, obviously, it will be clearer what is going to happen. 

MATTHEWS:  You are soft-soaping this, Senator Lott.

(LAUGHTER)

MATTHEWS:  You know the Republican Party is different than the Democrats.  It‘s not a free-for-all.  Usually, a couple business guys from downtown, wherever they‘re from...

(LAUGHTER)

MATTHEWS:  ... the Alta Club in Utah, or the Petroleum Club in—somewhere in Oklahoma, they go downtown.  They have lunch together.  They have a long lunch.  They decide who the nominee is for Congress.  They work out the presidency the same way.

Isn‘t your party usually a party that gets together at the top and picks a George W. Bush, like you did back in 1999? 

LOTT:  Yes.  That‘s right.  Yes. 

MATTHEWS:  Well, how come you haven‘t gotten together and picked somebody this time? 

(CROSSTALK)

LOTT:  Because there is no heir apparent and because there is, you know, disagreements with—a little bit with each one of them, some of their background, whether it is Giuliani, or McCain, or Huckabee or Romney.  I don‘t think anybody could pull together a group and say, OK, we are going to make it this one.  And, frankly, I like it better that way. 

Let‘s let the people decide.  Let‘s let the process go forward.  Sooner or later, we are going to wind up with a nominee and there will be a nominee on the Democratic side.  And I suspect you will see the poll numbers close up very quickly.  And I still think that even though the head winds are in our face, Republicans will be very viable by the time we get to fall. 

BREAUX:  I think the head winds look like a hurricane right now. 

MATTHEWS:  Are you amazed that John Edwards has had such a hard time breaking into the leadership here of this fight.  He hasn‘t won anything yet and he is an attractive candidate, in many ways.  But he‘s a good speaker.  Why can‘t he get to the front of the line? 

BREAUX:  I think he is an articulate candidate.  He‘s got good credentials.  But I don‘t think people like his message.  I think it is a divisive message, quite frankly.  I think people right now want a candidate that has experience and also committed to change and talk about the future.  And I think that it sounds like he is an angry candidate right now and I don‘t think that angry candidates do very well. 

MATTHEWS:  Let me ask you about the Democratic party and what it can do in the south.  I keep thinking all of the time that the softer states of the south, like Arkansas, if Hillary Clinton is the nominee—Louisiana used to be a gettable state for the Democrats.  Is there any gettable state?  Maybe Virginia now?  Where could Hillary win in the south? 

BREAUX:  Chris, you have to take a look at the south.  It is not that different from any of other part of the country.  There‘s a lot of dissatisfaction, quite frankly.  They think the war has gone on too long.  There are a lot of people losing their homes because of the mortgage crisis.  A lot of people are losing their jobs and a lot of people don‘t have health insurance. 

You remember the slogan, it is the economy, stupid.  That it come could back.  This could be a race based on the economy.  And I think the people in the south would like to see someone who is going to address those issues and make some changes and give them the same economic opportunity they used to have. 

MATTHEWS:  You don‘t think there might be a problem with a woman candidate or an African-American candidate in the south more than the rest of the country?  Or you say it is all about the same now? 

BREAUX:  Chris, I think that if you talk to a conservative white males in the south, they used to think Margaret Thatcher, as a woman prime minister, was a great choice in Great Britain.  She was tough.  She was strong.  She knew how to get the job done.  I think they‘re not going to be antagonistic to a woman candidate, nor a qualified black candidate, like Obama is clearly, one who is articulate, has a message of hope and optimism.  We have a large black population down there as well. 

LOTT:  And look at Louisiana, to the credit of Louisiana, they just elected the first Indian—

BREAUX:  Republican of Indian heritage.  I think that shows that the south can step up to the plate and vote for the most qualified person. 

MATTHEWS:  Senator Trent Lott, why did you guys leave the Senate?  I would like to be a senator, if I could hang out with you guys.  It seems to be losing its charm, that exclusive club there.  Trent Lott, sir, why have you left?  

LOTT:  Well, first of all, I served 35 years in the Congress, House and Senate, and four years as a staff member before that.  John and I started getting to know each way back in 1968.  And 35 year is a pretty good career.  Plus, John and I talked about the idea of getting together and forming a bi-partisan firm.  For years we kind of joked about it.  And then it just seemed like it was time for us to see if we could do this.  I think that there is going to be a big demand, frankly, for somebody that can talk to both sides of the aisle. 

MATTHEWS:  Senator Breaux, what happened to the old southern tradition of dying in office?  I mean, John Stennis and people like that, they just hang around and then slowly fade into a building being named after them or something, and they sort of notice that they are dead at some point?  They never actually left in the old days, did they Senator Breaux? 

BREAUX:  Some people probably think I did die in office.  It was time for me to leave.  But I think that really—I think things have started to change.  I think that people like to have more than one career in life.  they want to be able to take care of their family and their grandchildren.  You have to make sure you make the commitment to serve your country and then at some point, you have to make room for new ideas and new people and I think Trent and I both decided it was the right time to do that. 

MATTHEWS:  Great to have you on.  It‘s great to have you two great veterans, political heroes and legends of the Senate.  Anyway, thank you all for joining us, Senator John Breaux, Senator Trent Lott. 

Up next, two presidential races and two muddled pictures.  We straighten it in the politics fix.  We try to figure out, what is the theme of the Republican fight this year?  As Churchill said, this soup has no theme.  In the Democratic party, is it still an even match among the top contenders?  This is HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL and the politics fix.  Tonight, our round table; Dana Milbank is a columnist for the “Washington Post.”  He‘s always on page two.  He is author of the new book “Homo-politics, the Strange and Scary Tribes That Run our Government.”  Margaret Carlson of Bloomberg, she is joining us right now.  And Steven A. Smith of ESPN. 

Lady and gentlemen—I want you to start, Margaret.  Last night‘s debate—maybe we shouldn‘t call it a debate.  It did look a like the Trump show, “The Apprentice,” with people sitting around a very well-polished mahogany table.  I didn‘t see the contre-temps there.  I missed it if it was there.  They seemed to be too gentile.  Margaret, what did you think, who won? 

MARGARET CARLSON, BLOOMBERG:  Obama and Clinton had to make up.  They had to have that love-in at the beginning because it wasn‘t helping anybody.  Particularly, it wasn‘t helping Obama, who has wanted and needed to be not the black candidate.  He was being turned into the black candidate.  So they made peace and then they moved on to other issues and we are back to the pre-Philadelphia debate model, where Hillary Clinton is the queen of the facts, and Senator Obama is the Prince of Likeness, and Senator Edwards—former Senator Edwards just wants to fight, fight, fight, because it is personal, personal, personal.  And not that much happened. 

MATTHEWS:  Who wins that kind of battle? 

CARLSON:  There were a few matters of substance, but there is not that much difference between the candidates, so it does get back to personalities in the end. 

MATTHEWS:  Yes, let me go to Dana Milbank on that.  Dana, it seems to me, if that—if they return to their corners, as they do in boxing, there is no fight going on, and if they are in their corners, each in their separate corner, why would anything change, except Hillary leading out here in California by about 20 points, and on to Super Tuesday, where she takes it home to the bank. 

DANA MILBANK, “THE WASHINGTON POST”:  Conceivably, that could happen.  I don‘t see how a debate in which they are not sparring is going to really be very exciting to the voters or allow either of them to be getting any momentum whatsoever.  I am not sure; maybe they do care about the Yucca Mountain out there in Nevada.  But people would rather see these guys mixing it up.  We want to see that kind of fratricidal battle that is going on in the Republican side. 

MATTHEWS:  -- “Dr. Strangelove” and what do you call it?  Some body fluids—what do they call it?  Yucca Flats?  Yucca Mountain?  What are they talking about?  Go ahead, Steven. 

STEVEN A. SMITH, ESPN:  I was totally bored and I was disgusted.  Chris, I thought Barack Obama took a significant step back.  I think the race issue, the fact that he was being turned into the black candidate, per se, I think really, really affected him.  I think it showed.  I thought he was entirely too deferential last night, deferring to Hillary Rodham Clinton on a number of occasions.  He didn‘t seem to be himself and the reason why it was even more conspicuous was because he had been gaining momentum over the last few weeks or so with the Iowa caucuses, coming in second place in New Hampshire, really making a statement that he was going to make a run for the presidency.

I thought that the momentum was favoring him tremendously and he took a significant step back because I think that he was looking at his own community looking at him, and he started wondering about himself, and we saw trepidation on his part for the first time. 

MATTHEWS:  Interesting assessment.  Let me go to Margaret.  It seems that Hillary Clinton was therefore, because he wouldn‘t engage her, able to take on President Bush and command the situation. 

CARLSON:  Right, any time she gets to do her Bush number, she looks like the presumptive nominee and that is good for her, because her whole purpose is to look presidential and experienced.  She is ready on day one.  How many times did you hear 35 years, ready on day one, I can walk into the Oval Office.  It is like a recording. 

So she got to do that and I thought that the only human moments in the debate belonged to Obama however, because he is the only one who admitted to actually having a weakness.  The other two—Edwards says his weaknesses is that he feels too much and Hillary‘s is that she‘s too impatient to get things done.  What hewey. 

MATTHEWS:  You are so great, Margaret, my friend.  That is exactly what I thought at the time.  Steven, it struck me like the only guy who played fair and answered Brian Williams‘ question, and gave an honest assessment of a weakness, was Barack, who said I‘m lousy with paperwork.  You have to give me the staff paper right before I go on.  The others just used their weakness to be another selling point.  It was so cheap on their part, I thought.  What did you think, Steve? 

SMITH:  That is true, Chris, but the problem is that is usually what works.  You guys are the experts.  How many political pundits out there have repeatedly stated throughout the years that the more you show a weakness, the more it is held against you on election day.  I personally like honesty.  I like somebody who is willing to admit their flaws, or what have you. 

But in Barack Obama‘s case, you are an African-American candidate, the preeminent African American candidate in American history, as far as I‘m concerned.  It is undeniable.  You can‘t go up, especially in life, in the short aftermath of the controversy involving you and Hillary Rodham Clinton and display any weakness at this time.  It is not the weakness that he showed.  It‘s the timing that occurred with it.  So immediately after that, I think it is going to be held against him. 

MATTHEWS:  This is so fascinating.  We will be back with Dana‘s thoughts on that.  I find this Democratic fight so close in, so tough and personal.  And yet the Republican party is like looking through a kaleidoscope as a kid.  You see nothing but flashes of broken glass, no theory.  Back with the round table.  You are watching HARDBALL.  I‘m out in L.A.  I am going to do “The Tonight show.”  It is only on MSNBC, this show. 

(COMMERCIAL BREAK)

MATTHEWS:  We are become with the round table talking about last night‘s round table.  Dana, I just wonder what we are accomplishing here.  I was watching debate last night intensely for two hours and I came to the conclusion was we the American people are doing a pretty good job of winnowing down a group to the people who are best able to succinctly make a point.  Hillary and Senator Obama are both very good, both these senators, at saying something very smart, very succinctly, very cogently.  Is that what we‘re looking for in a president. 

MILBANK:  That‘s what we‘re looking for from these debates.  As soon as one says something cogently, the other one merely repeats it and takes over the slogan for themselves.  It is possible.  The debate was done well enough by MSNBC, but it‘s possible this sort of thing is really not what‘s having an effect out there.  It‘s all going to be about a bunch of Culinary Workers in white hats running around Nevada that will, in fact, make the difference out there. 

Particularly with so many primaries in so many places and everybody having a battle plan, it may not focus on any of these things they are talking about in the debate. 

MATTHEWS:  Steven, don‘t you see the same old pattern occurring here?  I know I owe this theory to Ron Brownstein of “The National Journal.”  But it seems to me ever since I can remember watching the Democratic party nationally, there‘s been this wonderful rift between the idealist, whether it‘s Bobby, Gene McCarthy, or Gary Hart, on the idealist side, and then the interest group expert, whether it is Walter Mondale, somebody like him, Dukakis, that rounds up the usual suspects and puts together a 40 percent some coalition. 

Hillary seems to be doing better at that.  Does that mean inevitably the Titanic, the ship, rather, being captained by Barack Obama is going to sink? 

SMITH:  I think a lot of that depends on what we‘re going to see over the next few weeks.  The reality is that Hillary Clinton, you expect her to do what she‘s been doing, building that coalition.  We all know about the Clinton machine, and how well it‘s worked, and how effectively it work throughout the years.  It was never a question about it working well.  The question was is Barack Obama going to be able to make some inroads. 

The key for him was to not be distracted by anything and to build his own coalition, which he‘s been doing in admirable fashion.  As far as I‘m concerned, he‘ll continue to do that, but you‘ve still go to pay attention because this is where Hillary really shines.  You expect her to do this kind of stuff.  You just do.

MATTHEWS:  Margaret, please come back tomorrow night.  I want your thoughts.  Please come back.  We‘ve run out of time here.

CARLSON:  I‘ll come back.

MATTHEWS:  I overdid it.  I‘m in L.A., I‘m confused.

Anyway, thank you, Dana Milbank.  Thank you, Margaret Carlson.  Thank you, Stephen A. Smith.  Right now, it‘s time for Tucker.

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

END   

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