updated 7/16/2008 11:33:27 AM ET 2008-07-16T15:33:27

Guest: Pat Buchanan, Mark Green, Rev. Eugene Rivers, Del Waters, Barbara Boxer, Christopher Bond, Karen Tumulty, Jill Zuckman, Perry Bacon

CHRIS MATTHEWS, HOST:  So who do you want to lead us in the world, Obama or McCain?

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  Two candidates, two speeches, two very different views about the war in Iraq.  Barack Obama and John McCain took on the war and each other today.  In Washington, Obama said the war had hurt America‘s interests around the world, including in Afghanistan.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE:  Senator McCain wants to talk about our tactics in Iraq.  I want to focus on a new strategy for Iraq and the wider world.

(END VIDEO CLIP)

MATTHEWS:  Moments later, John McCain came back with a speech in Albuquerque.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE:  I know how to win wars.  I know how to win wars.  If I‘m elected president, I‘ll turn around the war in Afghanistan, just as we have turned around the war in Iraq, with a comprehensive strategy for victory.  I know how to do that.

(END VIDEO CLIP)

MATTHEWS:  We‘ll take a look at the two candidates‘ competing views on the war, plus a new poll on who Americans think would make a good commander-in-chief.

Also, Barack Obama told the NAACP last night that he‘s not going to stop talking to African-Americans about individual responsibility, the very thing that got Jesse Jackson so upset last week.  So who speaks for African-Americans today, Obama or Jesse Jackson?

And President Bush said today that we‘re not in a recession and that the economy is basically sound.  That‘s what he said.  We‘ll hear from two senators with two very different views about that, and on the other things the president had to say today.

Plus, why does John McCain keep talking about a country that no longer exists?  We‘ll check that out in the HARDBALL “Sideshow.”

But first, Obama and McCain fight over Iraq.  Pat Buchanan is an MSNBC political analyst and Mark Green is the president of Air America radio.  Let‘s go right now—here‘s Senator Obama today on the Iraq issue.  Pat, you respond to this.

(BEGIN VIDEO CLIP)

OBAMA:  George Bush and John McCain don‘t have a strategy for success in Iraq, they have a strategy for staying in Iraq.  They say we couldn‘t leave when violence was up, and they now say that we can‘t leave when violence is down.  Theirs is an endless focus on tactics inside Iraq, with no consideration of our strategy to face threats beyond Iraq‘s borders.

(END VIDEO CLIP)

MATTHEWS:  Pat?

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  My view is that he makes a very good point about that in Iraq.  But I will say this, Chris.  I thought John McCain clearly won the day today when he came out and said “I know how to win wars,” Barack Obama opposed the surge, we would have been defeated in Iraq, I supported the surge, we‘re winning in Iraq, I will win in Afghanistan, this is the way to do it.  I think he‘s on his strongest ground.  It‘s an Eisenhower versus Adlai battle here, Chris.  I think it‘s McCain‘s strongest ground.  I really do.  And I do believe he had the stronger, simpler, clearer, more focused day.

MATTHEWS:  Mark Green?

MARK GREEN, AIR AMERICA RADIO:  Not surprisingly, I disagree with my colleague, Pat Buchanan.  I thought Obama, especially in that clip, Chris, had good rhetoric, presidential delivery.  And the facts on the ground are now sustaining him.  He‘s been consistent from the beginning.  He said we shouldn‘t go in because we‘d end up with an occupation that would end up hurting us.  He‘s making the same point.

And look, if al Maliki in Iraq that says a withdrawal date is a good idea, which is Obama‘s position and not McCain‘s, if, tragically, we‘re losing more soldiers in Afghanistan these two months than in Iraq—nine yesterday—which is—which sustains Obama‘s point that Iraq has taken our eye off the ball in Afghanistan, and if in Iran, Secretary Gates, with Powell and Baker and Hamilton, say we should have aggressive diplomacy, rather than a preemptive strike, again, Obama‘s position against McCain—

I see, this, Chris, as good policy by Obama versus good biography from McCain.  Hence the public is split on who you trust more.

MATTHEWS:  Well, here‘s Senator McCain...

BUCHANAN:  Chris...

MATTHEWS:  ... himself—Pat, let‘s look at McCain here, responding to what Obama said today.  This is hot news.

BUCHANAN:  Fine.

(BEGIN VIDEO CLIP)

MCCAIN:  Senator Obama will tell you we can‘t win in Afghanistan without losing in Iraq.  In fact, he has it exactly backwards.  It is precisely the success of the surge in Iraq that shows us the way to succeed in Afghanistan.  It‘s by applying the tried and true principles of counterinsurgency used in the surge, which Senator Obama opposed, that we will win in Afghanistan.

With the right strategy and the right forces, we can succeed in both Iraq and Afghanistan.  And they are not disconnected.  Success breeds success.  Failure breeds failure.  I know how to win wars.  I know how to win wars.  If I‘m elected president, I‘ll turn around the war in Afghanistan, just as we have turned around the war in Iraq, with a comprehensive strategy for victory.  I know how to do that.

(END VIDEO CLIP)

MATTHEWS:  Pat, are you saying we‘ve won the war in Iraq?  I mean, what do you mean by winning wars?  What wars has John McCain won?  Seriously.  Name the wars that we have won under his leadership, or his view.

BUCHANAN:  Well, Chris, you want to get into the substance, you want to get into the politics?

(LAUGHTER)

BUCHANAN:  Look, the American people—the American people believe we made a mistake going into Iraq.  Barack wins that.  The American people believe the surge has worked.  It is working.

MATTHEWS:  No, it hasn‘t.

BUCHANAN:  McCain wins that...

MATTHEWS:  The American people haven‘t been asked the right question, Pat.  You know you‘re wrong on this.

BUCHANAN:  But Chris...

MATTHEWS:  Pat, you‘re disagreeing...

BUCHANAN:  Chris...

MATTHEWS:  You‘re disagreeing with yourself on this, Pat.

BUCHANAN:  Chris...

MATTHEWS:  You have said in the past the reason to stick the Army in there with greater strength a year or two ago was to get the Iraqis to solve (ph) their own fish (ph), to put it together themselves politically so that we could come home.  By that definition, have we won?

BUCHANAN:  Chris, by the loudness of your argument and the intensity, you are suggesting McCain, indeed, has a powerful point.  We are winning in Iraq.  Violence is down.  American casualties are down.

MATTHEWS:  That‘s not the strategy.

BUCHANAN:  McCain is saying that strategy is working.  It will succeed...

MATTHEWS:  It might.

BUCHANAN:  ... if Barack Obama doesn‘t undermine it, in ending and succeeding in Iraq...

MATTHEWS:  Succeeding at what?

(CROSSTALK)

MATTHEWS:  Pat, I just want to know what you‘re talking about. 

Succeeding at what?  What war has been won in Iraq?

BUCHANAN:  I‘m telling you—what I‘m telling you is the success in Iraq, the overthrow of Saddam Hussein, removal of his regime, the emplacement of a regime that‘s more pro-American and anti-terrorism, the ability to go home and say this is no longer an anti-American, anti-Western country...

MATTHEWS:  Right.  OK.

BUCHANAN:  ... and to do the same in Afghanistan.

MATTHEWS:  Well, you got where I didn‘t think you‘d go.  You believe we‘ve won the war and we can come home eventually.

BUCHANAN:  I think there‘s no doubt we are winning as of now in Iraq...

MATTHEWS:  OK...

BUCHANAN:  ... because of the surge, and you can‘t deny that even if you oppose the surge.

MATTHEWS:  No, that‘s the most hawkish I‘ve heard you say, Pat.  Let‘s go to Mark on that.  Pat is asserting that we‘ve achieved our goal of creating enough peace in Iraq so that the contending sides could form a solid government that  can defend itself so we can leave.  Is that your assessment?

GREEN:  Pat quoted—cited Eisenhower before.  Let me quote Tacitus, whose Latin history Pat knows.  He said, We made a desert and called it peace.  How can you think that we‘re winning in Iraq when we went in, based on false intelligence, it would be a quick war, we‘d be greeted as liberators, terrorism would be abated, al Qaeda defeated.  None of that, Pat, of course, has happened.

John McCain made no sense in the clip you just ran, Chris.  I‘ll tell you why.  He said the success of the surge—his words—in Iraq shows how we can win in Afghanistan.  Even if you accept it‘s a success, which it is militarily but not politically, we don‘t have the troops to replicate in Afghanistan what we did in Iraq.

Second, on the surge succeeding.  Baseball reference, the night of the All-Star game—if the Yankees are beating the Red Sox 6-1 in the eighth and the Red Sox score one run, the Red Sox aren‘t winning.  They‘re still behind 6-2.  The people who misled us into this calamity are now suggesting it was a success.  That‘s a rhetorical argument.

BUCHANAN:  But you know...

GREEN:  The facts on the ground belie it, Pat.

BUCHANAN:  Well, look, hold it.  I opposed this war.

GREEN:  Yes, you did.

BUCHANAN:  I think it was a mistake.  I think the cost is entirely too high.  But there‘s—unquestionably, the surge has worked, and I think the American people see it as working.  And they do see McCain, by something like 7-to-4 or 7-to-5, as a far stronger man to lead the country.  And there is a clarity to that argument he is making.  Whether you agree with its substance and ultimate results or not, it‘s a more powerful message than the confused messages,, the very four or five messages Barack delivered today.  I‘m telling you...

GREEN:  Yes, Pat, you‘re making a good point...

BUCHANAN:  ... that clear and simple thing, “I know how to win wars,” is very powerful.  It is Ike versus Adlai.

GREEN:  Yes, one second.  Pat, you‘re in the war room and you‘re doing well.  I want to be in the wonk room.  Forgive me.

(LAUGHTER)

BUCHANAN:  You are!

GREEN:  The substance, I‘m afraid, by October will matter.  And it was Bush who said the success of the surge will be measured by less violence and political rapprochement between the two sides.  You would agree the second simply has not happened, right?

BUCHANAN:  No.  Maliki has made tremendous gains.  He‘s a much stronger leader.  That‘s why he‘s saying the Americans can maybe begin going home.  That is a success.  I think if the Americans see that and if McCain picks up on that, we‘re moving in the right direction, we‘re moving out of Iraq, and now I‘m going to win Afghanistan the way I won in Iraq...

MATTHEWS:  OK...

BUCHANAN:  I don‘t—the substance aside, it is a powerful political message for November, and anybody that thinks it‘s not...

(CROSSTALK)

MATTHEWS:  Pat‘s message—Mark, let—Pat‘s message holds true here.  “The Washington Post”/ABC News poll today finds a big advantage for McCain on the question of being a good commander-in-chief.  Nearly three out of four voters say that McCain would be a good commander-in-chief.  Obama, on the other hand, gets about a split decision at 48-48.

Having given that palm leaf to Pat, I want to respond on Eisenhower and some history here.  General Eisenhower was elected in 1952 to end the war, which he did, in Korea.  General Eisenhower refused to go into Vietnam in 1954, despite the urgings of others, including Richard Nixon.  He refused to go into the Suez campaign in the Middle East in 1956, despite the good intentions toward Israel.

Let me just make this (INAUDIBLE)  General Eisenhower was a man of peace, a man of strength and peace, who knew how to restrain U.S. foreign policy in the interests of U.S. foreign interests.

Pat, you know this.  Why are you going back with this ridiculous comparison between a hawk like McCain and a man of strength and restraint like Eisenhower?  You know they are two very different men.

BUCHANAN:  Well, listen, I agree with you.

MATTHEWS:  OK.  Thank you.

BUCHANAN:  I think Eisenhower was a great conservative president.  But I do agree with this, Chris.  Adlai...

MATTHEWS:  You made a false comparison, Pat.  I want you to take it back.

BUCHANAN:  I‘m not taking it back.

MATTHEWS:  That‘s a false comparison.

(CROSSTALK)

MATTHEWS:  Eisenhower was a man of restraint in foreign policy, like you are.

BUCHANAN:  He was also...

MATTHEWS:  John McCain is a hawk.  Go ahead.

BUCHANAN:  Comparisons that are real are this.  Eisenhower was a military man who was perceived as knowing what he was doing.

MATTHEWS:  Right.

BUCHANAN:  People said, Ike knows it.  And Adlai Stevenson was an intellectual...

GREEN:  Wait a minute.  I‘ve got to interrupt...

(CROSSTALK)

GREEN:  Help me here.

MATTHEWS:  Interrupt, Mark.

GREEN:  Eisenhower and McCain both served, both heroes.  The analogy ends there, Pat, because at the risk of taking my name off the vice presidential list, what war did McCain win?  And he spent Vietnam, his biggest war, of course, in a POW camp.  As Wesley Clark struggled to say accurately but impolitically, Eisenhower ran a war, McCain did not.  The comparison is so—is so silly.

Second, you want to compare Obama to an Illinoisan?  Compare him to Lincoln, who didn‘t have a military experience, didn‘t...

(CROSSTALK)

BUCHANAN:  What are you talking about?

GREEN:  One second—didn‘t go to Fort Sumter but knew what to do. 

So that Obama hasn‘t served is a liability compared to McCain...

BUCHANAN:  Look, I‘m not...

GREEN:  ... as to commander-in-chief numbers.

BUCHANAN:  Look, I‘m not saying they‘re two exactly—what I‘m saying is Eisenhower comes in with the trust of the people because he‘s a military man who‘s known war.  Adlai didn‘t have any of that.

(CROSSTALK)

GREEN:  ... Adlai Stevenson?  Where did he come in?

BUCHANAN:  Because he‘s from Illinois and he ran against Eisenhower, for heaven‘s sakes!  Do you recall ‘52?

GREEN:  Yes, I do.  But Eisenhower ran a war and didn‘t engineer a wrong war.

MATTHEWS:  OK...

GREEN:  John McCain is associated...

BUCHANAN:  I‘m not saying they‘re...

GREEN:  ... with a calamitous war.

(CROSSTALK)

GREEN:  Why does John McCain have credibility...

MATTHEWS:  Mark and Pat, we sound like a bunch of old guys on a park bench in Miami.  We‘re sitting here arguing about Adlai Stevenson.

GREEN:  He is.

MATTHEWS:  Half our audience wonders—we might as well be talking about Calvin Coolidge and William Howard Taft.  They don‘t know who he is!

BUCHANAN:  They know who Eisenhower is.

MATTHEWS:  Well, I do, too, Pat.

GREEN:  He‘s not running.  The guy who screwed up Iraq is running.

BUCHANAN:  Well, listen, the very intensity of your argument, gentlemen, tells me that Barack Obama‘s got a problem on this issue.

MATTHEWS:  OK, if that‘s your measure...

(CROSSTALK)

MATTHEWS:  If that‘s your measure...

BUCHANAN:  That‘s my observation.

MATTHEWS:  ... of intellectual confidence, then, Pat, you lost a long time ago.

(LAUGHTER)

MATTHEWS:  Pat Buchanan, it‘s always an honor to watch you switch sides between your ideals, your ideology and your partisan responsibilities.  Thank you, Pat Buchanan.  Thank you, Mark Green.

Coming up: Barack Obama tells the NAACP he‘s not going to stop calling on African-Americans to take more personal responsibility, even if it angers people like the Reverend Jesse Jackson.  Has the torch passed to a new generation of African-American leaders?

You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  On Father‘s Day, as many will recall, Barack Obama spoke at the Apostolic Church of God on the South Side of Chicago and had some blunt talk for fathers.

(BEGIN VIDEO CLIP)

OBAMA:  We need families to raise our children.  We need fathers to recognize that responsibility doesn‘t just end at conception.  That doesn‘t just make you a father.

(APPLAUSE)

OBAMA:  What makes you a man is not the ability to have a child.  Any fool can have a child.

(END VIDEO CLIP)

MATTHEWS:  Even as some people, including Jesse Jackson, said Obama‘s talk was too tough, he‘s not backing down.  Here he is, speaking last night before the NAACP.

(BEGIN VIDEO CLIP)

OBAMA:  I know there are some who have been saying I‘ve been too tough talking about responsibility.  NAACP, I‘m here to report I‘m not going to stop talking about it.

(APPLAUSE)

(END VIDEO CLIP)

MATTHEWS:  And a Gallup poll just released shows that 29 percent of African-Americans name Barack Obama as the person they‘d choose as their spokesperson on racial issues.  Only 6 percent said the Reverend Al Sharpton.  Only 4 percent, 1 in 25, said Jesse Jackson.

Joining me now is the Reverend Eugene Rivers of the Azusa Christian Community Church and Del Waters, a columnist for “Ebonyjet.”  Gentleman, thank you both.  This is a tricky issue when speaking to a larger audience which includes whites, as well as black Americans.  How do you address an issue like that when everybody‘s watching, Reverend?

REV. EUGENE RIVERS, AZUSA CHRISTIAN COMMUNITY CHURCH:  You talk straight and tell the truth.  Today, black America is in the midst of a generational and philosophic transition, and those two developments are similar but not synonymous.  What Senator Obama has done has struck the perfect philosophical note.

Forty years after the death of King and the Kerner commission report, black America is in a new context and we need a new conceptual framework.  And so what Senator Obama has done and should be encouraged to do more of is challenge the black community to do for itself and go from the audacity of hope to the politics of responsibility.

MATTHEWS:  Let me ask you, Del Waters, who does this help?  Because the average guy, the working guy, African-American guy who‘s busting hump, raising money for his family, helping his wife raise the kids, doing everything right—I mean, doing everything God asked him to do and mankind would like of him—he already is doing this.  What does he think or feel when he hear the reverend—or hears a politician like Barack Obama talking that line?

DEL WATERS, COLUMNIST, “EBONYJET”:  I think what he hears is somebody that‘s willing to take the reins of leadership, and I think that‘s what this issue boils down to, is leadership, leadership, leadership.  I think what you‘re seeing in the poll numbers is the fact that African-Americans like the message, regardless of who the messenger is.

I think when you talk about race as being the third rail in American politics, the fact that Barack Obama is addressing it front and center, not really seeking trying to be popular with groups like the NAACP or Reverend Jesse Jackson, but actually speaking to the issue itself, which is an issue in America that needs to be addressed—I think you see African-Americans dealing with the fact that they like what he is saying in the same way that when he addressed the issue on the war, he said, I opposed the war, we shouldn‘t have been in the war.  It‘s not necessarily a black or white issue, it is a leadership issue.

MATTHEWS:  Let me ask you, Reverend, Reverend Rivers, how does an African-American leader like Barack Obama make this case that there‘s a lot of self-responsibility obviously in every American family?  Everybody‘s got to raise their families.  There‘s no welfare out there to look out for all of us.

What—how does he balance that act with being a social Democrat, a liberal, if you will...

RIVERS:  That‘s right. 

MATTHEWS:  ... who believes the government ought to play a bigger role?

RIVERS:  He addressed that by being philosophically sophisticated. 

Del Walters got it right.  It‘s about leadership.  And what he‘s doing is saying that there are certain things that the state is politically and morally responsible for, as a good social Democrat.  What he‘s also arguing, which makes his position much more philosophically interesting, is that he‘s saying to the black community, black community, you have a special history.  And you have a certain obligation to collectively organize your resources to provide measurable outcomes. 

It is not—it is no longer adequate, when you have got a Serena and Venus Williams conquering Wimbledon, right, to argue that racism is the primary thing that holds black people back, when you have had two secretaries of state who were black for the last eight years. 

What Senator Obama‘s done is say, I‘m taking the black community to a new level of understanding and responsibility.  No longer are we going to trade in the politics of grievance.  He‘s saying, listen, black community, you better than this.  And we can correct the problems that confront us, because we‘re good enough to do it.  And I‘m challenging you to step up. 

MATTHEWS:  You know, let me talk about—let me ask you about that, Del.  You and I have known each other for a long time.  What do we say to white people about this ?  Let‘s be blunt about this. 

You know, Barack Obama, who‘s done everything right, by anybody‘s standards—he‘s worked hard at school, been a stellar student, going all the way to being head of the Harvard Law Review, which is just about the highest academic honor there is.  He‘s been an organizer to get people together, pull up from their bootstraps in the local community out in Chicago. 

He has not gone out reaching for the buck.  He has done everything he could for the people he grew up with.  He is a good guy by any moral standard, a good marriage, a good father.  And, yet, the white people out there—I sense it—I sense a lot of white people are going to be looking at that “New Yorker” cover yesterday and giggling over it. 

What do you say to them? 

WALTERS:  I think what you have a separate out—and I‘m sure that the good reverend would agree with me on this—without white America, there would have been no civil rights movement. 

RIVERS:  That‘s right. 

WALTERS:  And we have a tendency to overlook that. 

RIVERS:  That‘s right. 

WALTERS:  I think, sometimes, you have to realize that, even though, when we talk about Michael Jordan, and Denzel Washington, and Halle Berry, and Tiger Woods, and Oprah, there‘s still a part of America that only can see Barack Obama for the color of his skin. 

RIVERS:  That‘s right. 

WALTERS:  And that‘s going to take a lot of time to get over.

RIVERS:  That‘s right. 

WALTERS:  I think, sometimes, that‘s what you see in some of the polls where...

MATTHEWS:  Yes. 

WALTERS:  ... when you talk about that blue-collar vote that he can‘t get. 

RIVERS:  Right. 

WALTERS:  He may not ever be able to get that vote.  And that‘s why the issue of race is so important to this country.  It has to be discussed if America is to live up to its potential. 

And I think that is what you‘re seeing in this latest poll that came out, is that black Americans are saying, this is the course that we want to be on, where there is an honest dialogue about race in this country. 

MATTHEWS:  Yes, on both sides. 

Go ahead, Reverend Rivers.  Your thoughts. 

RIVERS:  Listen, Mr. Walters has it perfectly correct. 

And the beauty of Senator Obama‘s approach is that he‘s saying, we‘re going to have an intelligent conversation that doesn‘t fall back on one-liner rhetoric that plays the grievance card.  He‘s done a brilliant job. 

And the thing that‘s actually quite fascinating, when you think about it, is that, for the first time, we have a presidential candidate who‘s actually an intellectual, a thinking guy.  I mean, this is just a remarkable time in the history of this country.  And I think Senator Obama is to be applauded and encouraged for philosophically and morally challenging black America and, by extension, the larger society to do better. 

(CROSSTALK)

MATTHEWS:  Who was the last intellectual president? 

(CROSSTALK)

MATTHEWS:  I have got to get to—this is too hot to handle.  Who was the last intellectual president?  Woodrow Wilson?  Who would you say?  Kennedy a little bit.  Who was the last guy who thought speculatively?

(CROSSTALK)

WALTERS:  Yes, I would have to say that Kennedy challenged us intellectually by saying we have to be better as Americans.  And I think Obama is really doing the same thing.  And I think that‘s what America is reaching out to.  We have to look to America for what it is, not for what it used to be and not for what we want it to be.

MATTHEWS:  Yes. 

RIVERS:  Absolutely.

WALTERS:  And I think that that‘s what Barack Obama is doing in his campaign.  We talked about all of these different icons out there.  But there still are a lot of people who have fallen behind. 

RIVERS:  That‘s right. 

WALTERS:  And they have to be helped up...

RIVERS:  That‘s right. 

WALTERS:  ... and not given a handout, but helped out—helped up. 

(CROSSTALK)

MATTHEWS:  Right. 

WALTERS:  And I think that‘s what Barack Obama speaks to. 

MATTHEWS:  Go ahead.

RIVERS:  Senator Obama represents a new philosophic direction that says, we‘re going to move in new directions on a philosophical approach, politics, policy, and program.  And, for that reason, this is absolutely amazing.  And he has to be supported and encouraged to even challenge us more philosophically, in terms of our agenda.

MATTHEWS:  OK. 

We all share the American religion.  The way thing things are is not the way they have to be. 

RIVERS:  That‘s right. 

MATTHEWS:  Thank you very much, Reverend Rivers. Thank you, Del Walters.

WALTERS:  Thank you. 

MATTHEWS:  Up next:  John McCain shows off his international bona fides by citing a country—this a little sarcasm here—that, unfortunately, no longer exists.  That‘s next in the “Sideshow.”

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

Time now for the HARDBALL “Sideshow.”

Well, now, John McCain would like you to think that he‘s the foreign policy expert in this election, that he could take anyone in a game of risk.  Well, he may need a history refresher, at least when it comes to one region.  Check out this exchange yesterday. 

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE:  I was concerned about a couple of steps that the Russian government took in the last several days.  One was reducing the energy supplies to Czechoslovakia.  Apparently, that is in reaction to the Czechs‘ agreement with us concerning missile defense. 

(END VIDEO CLIP)

MATTHEWS:  Yes, problem there, Czechoslovakia hasn‘t existed in over 15 years.  It split up into the Czech Republic and Slovakia back in 1993.  And, unfortunately, it looks like no one gave McCain the heads up.  Here he is at a town hall just this afternoon. 

(BEGIN VIDEO CLIP)

MCCAIN:  I regret some of the most recent behavior that Russia exhibited.  And I will be glad to talk about that later on, including reduction in oil supplies to Czechoslovakia, after they agreed with us on a missile defense system, et cetera. 

(END VIDEO CLIP)

MATTHEWS:  Czechoslovakia was, of course, that country that Hitler began grabbing in 1938 and took all of in ‘39. 

Next, the wait is finally over.  Former Minnesota Governor and pro wrestler Jesse Ventura has been teasing the media for weeks now about getting into the ring for the U.S. Senate race against incumbent Norm Coleman and challenger Al Franken out in Minnesota.  Ventura went on CNN last night to end speculation once and for all.  Or did he?  Take a listen. 

(BEGIN VIDEO CLIP, “LARRY KING LIVE”) 

JESSE VENTURA, FORMER GOVERNOR OF MINNESOTA:  I will tell you now, I am not going to run at this moment.  But, if between now and 5:00, maybe God comes and speaks to me, like he did the president, and tells me I should run, like he apparently told the president to invade Iraq, well, then, maybe at 5:00 tomorrow, Larry—don‘t call me a liar—just understand, God sent me to file. 

How‘s that? 

(END VIDEO CLIP)

MATTHEWS:  That‘s what he told Larry King. 

So, it‘s still, as I speak tonight, a battle between Democrat Al Franken and incumbent Republican Senator Norm Coleman out in Minnesota.  No divine intervention in St. Paul. 

Next, it‘s been a tough year for Zimbabweans, as you know, political turmoil aside.  “Newsweek” reports that Zimbabweans are dealing with a financial crisis far worse than anything we have ever seen in the world. 

One newspaper tags the inflation rate in Zimbabwe at 32 million percent a year.  That‘s 32 million percent.  Now the German company that supplies half of the government‘s currency has stopped sending the paper that the Zimbabwean dollars are printed on. 

Next, they will be running out of wheelbarrows to carry the money in. 

Time now for tonight‘s “Big Number.”

As we mentioned earlier in the show, Senator Obama delivered a major speech on Iraq and national security this morning to make it very clear what he considers to be the next front in the war on terror.  Take a listen. 

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE:  The situation in Afghanistan has deteriorated.  Real security and development in Afghanistan.  The security of Afghanistan.  Al Qaeda in Afghanistan.  We cannot lose Afghanistan.  Refocuses on Afghanistan.  Parts of Afghanistan.  Heroically in Afghanistan  Than Afghanistan.  Combat brigades to Afghanistan. 

(END VIDEO CLIP)

MATTHEWS:  So, all together, how many times did Obama mention Afghanistan in that speech?  Twenty-two times.  That‘s right.  There were 22 mentions of Afghanistan in a speech that was supposed to be about Iraq.  As I said, it‘s sharp politics there that cuts into McCain‘s turf of being the best guy to defend the country—tonight‘s “Big Number.”

Up next;  President Bush says the economy is growing, while calling on Congress to lift that ban on offshore oil drilling and also shore up the mortgage giants Fannie Mae and Freddie Mac. 

When we return: reaction from two U.S. senators, Democrat Barbara Boxer of California, Republican Kit Bond of Missouri. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

COURTNEY REAGAN, CNBC CORRESPONDENT:  I‘m Courtney Reagan with your CNBC “Market Wrap.” 

Well, stocks closing mostly lower, as oil prices plunged.  The Dow Jones industrials fell 92 points.  The S&P 500 lost 13 points, while the Nasdaq eked out to three-point gain. 

Well, oil fell more than $10 a barrel at one point, before closing at $138.74 a barrel, down $6.44 for the day, that all as investors worried about whether sky-high prices are sustainable. 

General Motors announced new cuts.  GM says it will reduce its salaried work force by 20 percent, cut truck production, and suspend its dividend as it seeks to raise $15 billion to survive. 

And in semiannual testimony for Congress, Fed Chairman Ben Bernanke warned, the economy faces numerous difficulties.  He also cautioned about inflation risks. 

And after the closing bell, tech bellwether Intel reported quarterly earnings that beat analyst estimates.  Shares are higher in after-hours trading. 

That‘s it from CNBC.  We‘re first in business worldwide—now back to

HARDBALL. 

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  The bottom line is this.  We‘re going through a tough time.  But our economy has continued growing.  Consumers are spending.  Businesses are investing.  Exports continue increasing.  And American productivity remains strong. 

(END VIDEO CLIP)

MATTHEWS:  Welcome back to HARDBALL. 

President Bush says the economy is growing.  Really?  Today, the Dow closed below 11000 for the first time since July of 2006. 

Democratic Senator Barbara Boxer of California chairs the Environment and Public Works Committee.  And Senator Kit Bond is a Missouri Republican. 

Thank you, both, Senators, for joining us.Here‘s President Bush, today, talking about the economy.  I want you to respond, first, Senator Boxer. 

(BEGIN VIDEO CLIP)

BUSH:  I‘m not an economist.  But I do believe that we‘re growing.  And I can remember—you know this press conference here—people yelling “recession” that as if you‘re economists.  And I‘m an optimist.  I believe there‘s a lot of positive things for our economy.

But I will tell you it‘s not growing the way it should, and I‘m sorry people are paying as high gasoline prices as they are.

And all I know is good policy will help expedite—will strengthen our economy. 

(END VIDEO CLIP)

MATTHEWS:  Barbara Boxer, Senator, it‘s $4.75 a gallon out here in San Francisco today. 

SEN. BARBARA BOXER (D), CALIFORNIA:  It‘s just awful.  I have seen it over $5 for diesel fuel. 

And, you know, listening to the president, he just seemed to be mumbling.  I—I didn‘t really sense what he is suggesting for this country. 

And it only underscores the need for change, a change in an energy policy, just an overall change in the way we value our workers, the way we train them.  And it‘s—it‘s definitely something that I think is going to help Barack Obama.  It‘s going to help Democrats who are running this year for the United States Senate. 

Change is the word.  There‘s a lack of leadership here.  And then you have got John McCain‘s Phil Gramm saying we‘re all a bunch of whiners.  We‘re certainly not a bunch of whiners.  People understand how bad things are. 

They see it with the gas prices.  They see it with the housing market. 

They see it all around them.  And it turns—people are hurting, Chris. 

MATTHEWS:  Senator—Senator Bond, Ronald Reagan was elected president over Jimmy Carter.  He basically kicked him out of office by asking the question, are you better off than you were four years ago?  If you asked that question today, people would have to say, no, wouldn‘t they?

SEN. CHRISTOPHER BOND ®, MISSOURI:  Let me answer some of the things that my colleague from California said. 

Number one, people are hurting.  People are hurting in California.  They‘re hurting in Missouri.  They‘re hurting on the East Coast.  This $4.00, $4.75 gas, diesel prices even higher, this is causing real problems for the economy.  And the economy is hurting.  Businesses are hurting.  But, most of all, families are hurting. 

Now, what we need to do is change 30 years of policy that have prevented us from producing the energy that we have off our shores, in our lands, in the shale oil, the energy that we have underground in coal, and the lack of any refineries. 

We need change.  And, unfortunately, my colleague represents the party that has kept us locked up without the energy supplies.  We need more responsible production.  We need more conservation.  We need more alternative fuels.  And we also need to make sure the markets work well.  Those are the kinds of changes that will bring relief to the people of America. 

MATTHEWS:  Senator Boxer, do we need to start drilling in places we haven‘t wanted to drill before? 

BOXER:  We need to see the oil companies drill on the land, the leases that they have on shore and off shore.  There‘s 68 million acres that they have access to; they‘re not drilling.  There‘s at 28 million acres in the Naval Reserve that they could have access to.  They‘re doing nothing, Chris. 

And I maintain that when you have two oil men in the White House for eight long years and you see gas prices go up 300 percent, to turn around and blame the Democrats in Congress just doesn‘t wash.  The oil companies have gotten everything they wanted.  It‘s time to say use it or lose it.  Of course there are place we can drill.  I want you to know something; there are a lot of jobs that come out of a beautiful, pristine coast in certain areas of my country.  In my own state, for example, in Washington State, off the shores of New Jersey, for example, and many other places, North Carolina, I could go on.  The fact is that is a 70 billion dollar—

70 billion dollar coastal economy, two million jobs. 

So, of course, we want to drill.  Of course, we need to conserve.  Of course, we need renewable energy and my Republican friends, just to keep up a little argument here, are the ones who said, oh, no, we‘re not going to give the solar companies, the winds companies, the geothermal the tax credits, the tax cuts that they deserve.  And we‘re seeing that have a very bad impact.

So, yes, I would say this; it is time for change and it is not only an energy policy.  It has to with this war in Iraq that is sucking the money out of this country.  We need to invest in our country.  That‘s why I‘m so excited that November is coming.  I wish it was tomorrow. 

MATTHEWS:  What do we about the public‘s dissatisfaction with the way things are right Now, Senator Bond?  all of these programs for changing our energy policy won‘t kick in until, you know, four, five years from now at the earliest. 

BOND:  Well, first, let me say to the senator from California, California doesn‘t want to drill off their coast, that‘s fine.  Let them have that option.  But Virginia does.  Louisiana does.  Texas does.  Other states want to drill.  And we ought to do that and we ought to not tie them up endlessly in court battles. 

But the fact is the president did do something today.  He lifted the presidential moratorium on off-shore drilling.  That brought oil prices down six dollars.  If we simply show we‘re that going to get serious about producing the energy that we have, this will bring it down.  This will get the speculators.  And we need to make it clear that we will pursue all of these in an environmentally friendly way. 

All the rigs off Louisiana did not spill any significant amount of oil in Hurricane Katrina.  We can produce oil and gas in a much more environmentally sensitive way than the other countries that my colleagues want to beg to produce that oil. 

Now, yes, we need change and we need—I think the people in Missouri understand that it‘s simply Economics 101.  If you have constrained supply, it doesn‘t grow and the demand increases as it is in China and India, you‘re going to have prices going through the roof.  We need to get supply to catch up and bring conservation to bring the demand down. 

MATTHEWS:  Senator Boxer, Senator Bond, thank you both for joining us. 

We‘re out of time. 

BOXER:  You didn‘t give me a chance.

MATTHEWS:  I know, we‘re out of time.  Let me tell you, Senator Boxer, I want to thank you on behalf of NBC and everybody else who is concerned about getting that bill out of your committee to name that highway after Tim Russert up in New York State; Route 20-A is now going to be known as the Timothy J. Russert highway because the House voted today and the president is expected to sign it tonight. 

Thank you all on a nice personal note there.  Thank you very much for joining us. 

Up next, the politics fix.  Who would make the better commander in chief?  Barack Obama or John McCain?  The answer and why it might not decide this election.  This is HARDBALL, only on  MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL and the politics fix.  Tonight‘s round table, Perry Bacon of the “Washington Post,” Jill Zuckman of the “Chicago Tribune, and Karen Tumulty of “Time Magazine.”  Let‘s all take a look at this combination of polls, which is good news and bad news or bad news and good news for Barack Obama.  According to the latest “Washington Post”/ABC News poll, John McCain leads Barack Obama when it comes to who Americans think would make a good commander in chief, 72 to 48.  That‘s 72 percent say McCain would be great.  Only 48 percent say Barack would be great.  By the way, 48 percent say he wouldn‘t be, which is interesting. 

Even though the candidates are putting Iraq and Afghanistan front and center, the latest Quinnipiac Poll has the economy at 53 percent as the most important percent.  Iraq is down at 16.  Perry Bacon, bad news and good news for Barack Obama.

PERRY BACON, “THE WASHINGTON POST”:  Yes, I think there‘s good news in there.  One, that the economy‘s viewed as such a big issue.  Two, he‘s leading in these polls, in part because people are concerned about the economy, and view him as the best candidate.  The bad news is he‘s going to have to spend some more time, which is why he‘s going abroad and giving speeches about security, like today.  He‘ll have to spend more time emphasizing his ability to be commander in chief, which currently Americans view John McCain as the more qualified person to hold that very important job and the presidency. 

MATTHEWS:  Jill, when we get to October, when people watch the debates, when 80 million people, not 20 million, will be watching television on politics, and they‘ll be looking at these two candidates, what‘s the hotter issue?  The Iraq issue, Afghanistan, that front, Iran as well, or is it the home front, the economic front? 

JILL ZUCKMAN, “THE CHICAGO TRIBUNE”:  It seems to me when we‘re having runs on banks right now that the economy is not going to go away as the most important issue in this election.  Now, you have to throw in a caveat you don‘t know what‘s going to happen.  When it comes to foreign policy, things can pop up at the most inconvenient times.  For Senator McCain, that‘s a plus because he loves talking about that sort of thing.  For Senator Obama, I think this poll shows that this is an area that he needs to work on a little bit. 

MATTHEWS:  Karen, look at this Quinnipiac poll that just came in.  It shows that Obama is seen by the voters as better able to handle the economy, 53 to 39.  Is that simply the residue of Bush? 

KAREN TUMULTY, “TIME MAGAZINE”:  I think to a great degree, it is.  I was traveling with Senator McCain last week at some of those town hall forums, where he‘s out there trying to talk about the economy.  One of the first questions he got at of them was from a supporter who said when are you going to just finally say, read my lips, I am not the third term of George Bush.  I think this is an anchor that John McCain is going to drag right up into November. 

MATTHEWS:  How does he disagree from Bush on the economy? 

TUMULTY:  There was a very interesting segment on one of the Sunday shows where I believe it was Wolf Blitzer asked one potential running mate, Governor Mark Sanford of South Carolina, that very question.  Governor Sanford was really unable to come up with a difference.  Senator McCain talks a lot about earmarks, curbing federal spending.  Certainly, that is not an issue where the Republicans have had a good record in the last eight years. 

But I don‘t think that quite qualifies as a major change in course economically. 

MATTHEWS:  Jill, I score that for Wolf Blitzer.  In this business, when you ask a big shot a question and they have no Earthly idea what the answer is, that‘s a victory for the questioner.  Wolf asked him a simple question, tell me one area where this will not be a third Bush term for Bush, where John McCain does differ in any way from what Bush would do if he got another four years.  He couldn‘t come up with one.  He kept saying, I can‘t think of anything. 

ZUCKMAN:  Governor Sanford has not spent a lot of time on the campaign trail with Senator McCain.  He did not support him during the South Carolina primary.  He stayed neutral.  He hasn‘t been out on the road with him.  So he hasn‘t been listening to him at town hall meetings, when he talks about freezing spending, about cutting domestic discretionary spending, about no more earmarks.  He is, I would say, Messianic on this topic.  It‘s a very big difference from the way the Bush administration has run things. 

MATTHEWS:  If you don‘t watch during the week, don‘t show up on Sunday.  That‘s the message to Governor Sanford.  We‘ll be right back with the round table for the politics fix.  We‘re going to talk about Iran and whether going to Israel is going to war with Iran.  You‘re watching it, only on MSNBC.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE WILL, COLUMNIST:  It will be Barack Obama‘s challenge to say that change and caution, risk and caution are the same thing this time, because the risk is to continue with, A, what he will say are the Bush economic policies and, he will say, the danger of war with Iran from a man who has said, as John McCain has, that bad as a war with Iran would be, it‘s not as bad as there getting nuclear weapons.  Since there seems to be no other way other than war to stop them. 

(END VIDEO CLIP)

MATTHEWS:  That‘s George Will on HARDBALL, not long ago.  We‘re back with our round table for more of the politics fix.  Here‘s what John Bolton, Bush‘s former UN ambassador, who is now with the American Enterprise Institute, wrote today in the “Wall Street Journal”; “Instead of debating how much longer to continue five years of failed diplomacy, we should be intensively considering what cooperation the U.S. will extend to Israel before, during and after a strike on Iran.  We will be blamed for the strike anyway and certainly feel any negative consequences result.  So there‘s a compelling logic to make it as successful as possible.” 

Boy, that‘s pretty strong words by the former ambassador to the UN of President Bush.  Perry Bacon, going to war with Iran; is this going to be an issue come October? 

BACON:  I think, probably no.  No.  I think neither McCain nor Obama -

we‘re fighting two wars now.  I expect think won‘t discuss starting a third.  I do think there‘s a difference between the two of them in how they would approach this issue, with Obama more focussed on continuing the multilevel discussions and that sort of effort.  McCain is more strident in supporting and talking about the military options. 

MATTHEWS:  Jill Zuckman, George Will points out that McCain has been clear on this, saying if they move towards weaponization, we ought to strike. 

ZUCKMAN:  Senator McCain is definitely very, very concerned about Iran.  He talks about it a lot.  I think, actually, though, contrary to what Perry just said, McCain and Obama are both supportive of multilateral talks as well as sanctions.  I think the difference comes more with Senator McCain Not wanting to engage in direct talks with their leaders and Senator Obama more interested in doing that. 

What I like about this issue is that this is a substantive disagreement.  They are having a substantive debate.  It‘s not name calling.  It‘s the real deal.  They are both coming at it from different area‘s. 

MATTHEWS:  I‘m with Jill.  I think there‘s a real dichotomy.  John McCain was caught making a joke about this, saying his policy towards that region was bomb, bomb, bomb Iran, like in Barbara Anne from the Beach Boys.  But, clearly, he is a hawk on this matter. 

TUMULTY:  Yes, but the kind of hypothetical that Bolton raises in that op ed is exactly the kind of thing that candidates do not and should not really address on the campaign trail.  John McCain does seem to be more forceful right now in how he talks about this.  He talks about the need to impose sanctions now on Iran, whereas Barack Obama talks about threatening them louder.  He also talks more about missile defense and the need to get that it up and operating. 

Again, what would you do if Israel went to war is not going to be a question that either candidate is going to address or, quite frankly, should address. 

MATTHEWS:  We‘ll find out.  Thank you very much, Perry Bacon.  I‘m worried about this.  Jill Zuckman, Karen Tumulty.  Join us again tomorrow at 5:00 and 7:00 Eastern for more HARDBALL.  Right now, it‘s time for RACE FOR THE WHITE HOUSE with David Gregory.

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

END   

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