updated 9/8/2008 1:54:01 PM ET 2008-09-08T17:54:01

Guest: Bill Burton, Nancy Pfotenhauer, Michelle Bernard, Roger Simon, Ron

Brownstein, Todd Harris, Steve McMahon

CHRIS MATTHEWS, HOST:  Good-bye Bush, good-bye Cheney, hello Sarah.  John McCain splits with Bush and Cheney and takes on a new partner, Alaska governor Sarah Palin.

Let’s play HARDBALL.

Good evening.  I’m Chris Matthews.  Leading off tonight: Senator John McCain delivered his declaration of independence from the Bush administration in his acceptance speech last night.  President Bush didn’t attend the convention.  His father, former President Bush, wasn’t in the hall last night.  Dick Cheney’s name was never mentioned when McCain spoke.  And McCain made it perfectly clear this is a political divorce from the last eight years of Republican rule.

But the biggest applause line came when Senator McCain mentioned his new running mate, Alaska governor Sarah Palin.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL NOMINEE:  And I found just the

right partner to help me shake up Washington, D.C., Governor Sarah...

(CHEERS AND APPLAUSE)

MCCAIN:  ... Governor Sarah Palin of the great state of Alaska.

(END VIDEO CLIP)

MATTHEWS:  Boy, they love the new kid on the block.  But did John McCain do what he had to do last night in St. Paul?  More on that in a moment.

Sarah Palin emerged as the new rock star of the Republican Party, if you will, and today she took to the campaign trail with McCain in Wisconsin.  But Barack Obama says, in effect, Palin should not be treated any better or worse by the press because she’s a woman.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL NOMINEE:  I think she’s got a

compelling story, but I assume that she wants to be treated the same way that guys want to be treated, which means the records are under scrutiny.

(END VIDEO CLIP)

MATTHEWS:  Well, the Obama campaign has even enlisted, guess who, Hillary Clinton, who will hit the trail for Obama next week.  Can Hillary keep her passionate supporters from defecting to McCain and his new team?

Plus, we’ll talk to our strategists, one Republican and one Democrat, about what both sides need to do now that the conventions are over.

And if you were watching last night, here’s a funny moment.  I have to tell you, I love Andrea.  Look at this crazy moment!  For some reason—I don’t know whether it was foul play or what it was—a billion balloons went right into her when she was trying to do a report from the floor.  She was getting absolutely buried in that post-speech balloon drop.  And by the way, that’s one of the great moments.  By the way, Republicans are much better at balloons than Democrats.  Let me make it official.

But we begin—we begin tonight with Senator John McCain’s acceptance speech at the Republican convention.  It was the big event of the week, almost as big as the running mate speech.  Mark Whitaker is NBC News’s Washington bureau chief and Ron Brownstein is the political director of Atlantic Media.

First of all, I’m going to give you a chance to support the troops there, Mark.  One of your troops was under balloon attack last night!

MARK WHITAKER, NBC WASHINGTON BUREAU CHIEF:  We were calling her

“Andrea of the thousand balloons.”

(LAUGHTER)

MATTHEWS:  I think Tom Brokaw called her Boom-Boom (ph) last night.

Anyway, let me ask you about the staging, since you’re on right now, Mark.  Republicans do seem to be better at staging these things.  The balloon drop occurs on schedule.  The Democrats (INAUDIBLE) stuck up in the webbing up there.  What did you think of the whole rollout of the new running mate, and of course, the refurbished candidacy of John McCain?

WHITAKER:  Well, I feel like I just got back from a week of “Alaskan Idol.”  I mean, when you think about it, Sarah—a week ago, most Americans didn’t know who Sarah Palin was.  The other night, 37 million people tuned in to watch her speech.  She’s on the cover of “People” magazine.  It’ll probably sell out.  Clearly, she was the hit of this convention.

You know, I think last night’s speech by McCain was, I think—sort of did its job, but it was a little bit underwhelming by comparison.  But look, what he had to accomplish this week was to unify the party.  He came into the convention with a lot of doubts about him, not a lot of enthusiasm in the rank and file.  And I think Sarah Palin did that for him, and I think—without her, I think we would have been coming out of the convention feeling that it just didn’t really measure up to the Democratic convention, that the momentum was on the Democratic side.  I think she helped stop that.  I think the polls are going to suggest that it’s still a very, very tough and even race.

MATTHEWS:  Let me ask you this, Ron.  Is John McCain the Republicans’ choice?  I know he won the nomination fight fair and square.  He knocked out all other contenders.  Does he have the heart of the Republican Party?  I just was taken again during this week, when everybody was cheering the fact that this is a party of mavericks—well, of course, the Republican Party...

RON BROWNSTEIN, “NATIONAL JOURNAL”:  Right.

MATTHEWS:  ... is not a party of mavericks.  It’s a party of regular Republicans, middle-class people, mostly white, not very much diversity there, very much uniform in their thinking—lower taxes.  They support the war.  The idea of a party of mavericks—is that real or is that just the show business of this week?

BROWNSTEIN:  Well, I think it was not a very popular idea a year ago, and I’m not sure it’ll be as popular a year from now, if he wins.  The Republican Party is more ideologically uniform than the Democratic Party, whether you look at it by its electoral coalition or the folks in Congress.  And all the things that were being cheered this week—John McCain’s willingness to break with his party, his disagreements with Bush, his tendency to set an independent course—those were the principle obstacles to him in winning the nomination initially, one reason why he didn’t run so well among rank-and-file Republicans.  And if he is president and is trying to govern that way, there will be a lot more conflict.

Can I just disagree a little bit with Mark, politely?  I do not think John McCain accomplished what he needed to do last night.  I think the speech will be looked back on as a missed opportunity because I think it reinforced him where he was strong, rather than shoring up—shoring him up where he was week.

Americans already believe John McCain is a person of integrity with a heroic personal story, and I think he was very effective of recounting those aspects of his career.  But where he was weakest in the speech is where I think he ultimately will have the greatest need in this race, regardless of what happens in the next few days in the tracking polls.

The biggest obstacle for McCain is the doubts among those swing voters that he has energy, vision a plan to deal with their day-to-day concerns, and that’s where the speech was clearly at its weakest.  There really was very little effort to kind of show that he could roll up his sleeves and deal with their kitchen table problems.  And I think that lost opportunity will be significant.  If they can’t figure out a more effective way to convince people that they’re in there, you know, kind of under the hood, solving problems, I think it is going to be a problem for McCain and probably force him back into a strategy that focuses on disqualifying Obama.

MATTHEWS:  But isn’t that a risk he would take—let me ask Mark this

because just politically, if he lays out a litany of things he’s going to do, a new vision as a maverick, he goes the ideological route which makes that room happy, the red meat ideological route, rolling back the New Deal, cutting taxes dramatically, maybe a more hawkish foreign policy, then he risks the middle.  Didn’t he have a Hobson’s choice there?

WHITAKER:  Well, you know, the other thing you have to remember is—

I’m not sure that this new—this reform message is fairly new.  And I think it may actually have been driven in a kind of chicken and egg way by his choice of Sarah Palin.  Up until less than almost a little bit more than a week before the convention, our reporting suggests that McCain very much wanted to pick his friend, Joe Lieberman.

MATTHEWS:  Yes.

WHITAKER:  I think if he had picked Lieberman, it would have been a different message.  It would have been bipartisanship.  It would have been experience.  I think at the last minute, he went to Palin.  And I think because of her life story and her image as a reformer, I think they decided to go with the reform message.  So I’m not sure that they actually have the specifics lined up behind that message.  Maybe we’ll see more of that in the coming days.

BROWNSTEIN:  Chris...

MATTHEWS:  Boy, it’s a stunning development, gentlemen, because if that was the case—and that was reported by “The New York Times,” Elisabeth Bumiller, and I believe Andrea’s on that story, too—Mark, that he was really edging up close and was probably talked out of it by his people.  What a dramatic change.

Let’s watch now John McCain speaking last night.  It’s such an amazing confession, I thought, for a major acceptance speech.  Here he is talking about—I believe this bite is him sort of recounting the sins, if you will, of the last eight years.

(BEGIN VIDEO CLIP)

MCCAIN:  I fight to restore the pride and principles of our party.  We were elected to change Washington, and we let Washington change us.  We lost—we lost the trust of the American people when some Republicans gave in to the temptations of corruption.

(END VIDEO CLIP)

MATTHEWS:  Mark, I’ve been following politics since I was about 10 years old, and I’ve never heard a political party candidate admit the sins committed by not himself, his party.

WHITAKER:  Look, you know, when Sarah Palin was up there talking about the outsider, the reformist message, it was very credible because she’s about as far away from Washington as you can get.  She does have a record.  I mean, we’re going to look at it.  We’re going to scrutinize it.  But clearly, she has—there’s some evidence that she stood up to special interests, and so forth.

I mean, you know, McCain has some record as a reformer, as a maverick, but the fact is he’s been a creature of Washington for decades now.  And it just—you know, watching that speech in the hall last night, it just didn’t come across credibly.

And you know, you talked about staging.  And perhaps it’s a little bit unfair to dwell on these superficial things, but you know, also, if you’re going to say you’re a reformer, he—at one point, he said everything—almost everything in Washington needs to be changed.  Well, you have to have a sense that you’re somebody who has sort of the energy and the drive to go in there.  He wasn’t projecting that last night.

BROWNSTEIN:  Yes.

WHITAKER:  I think some of the—that screen behind him sort of made him look like he was in an aquarium most of the night.

(LAUGHTER)

WHITAKER:  You know?  So I mean, I think—you know, I’m not sure that that part of the message went off that well.

BROWNSTEIN:  Chris?

MATTHEWS:  Go ahead.  Go ahead.

BROWNSTEIN:  Yes.  I was going to say, that kind of rhetoric reflects the overarching strategic, you know, reality of this campaign, which is that John McCain cannot win by simply unifying Republicans.  He has to win independents in order to win, which is not true in reverse, by the way...

MATTHEWS:  Yes.

BROWNSTEIN:  ... for Barack Obama.  And the reason is because the Democrats now outnumber Republicans in the electorate.  In 2004, Bush was able to win because he was able to drive up Republican turnout to the point where it equaled Democrats.  He lost independents and still got elected.

John McCain has to find a way to try to narrow that partisan ID gap, that intensity gap, and to also try to reach out to the middle.  And as we have said, I mean, Sarah Palin is an attempt at a two-fer here, that with the social conservative views to try to get some energy in the base—she certainly electrified the hall on Wednesday—and hoping that with her kind of reformer ID, that he can reach out to the middle.

But I think the piece that was missing last night was process reform, yes, policy outcome, not so much, and as Mark said, not the energy.  I mean, the issue about his age I don’t think is whether he is competent to be president, it’s whether he is forward-looking, has new ideas, a vision, the energy to change things.  And I don’t think he conveyed that very effectively last night.

MATTHEWS:  I think the question, Is there a McCain future—as simple as that—is the challenge, I think you’re right, still facing the party.

Ron Brownstein, thank you.  Mark Whitaker, thank you.

Coming up, the strategists.  And with the conventions over and the vice presidents nominated, what’s next?  We’ve got a weekend ahead of us, and a couple weeks from now, we got the big debate coming up.

You’re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  The vice presidential candidates have been picked.  The conventions are over, believe it or not, and now McCain and Obama head into the home stretch.  So what’s coming next?  Will Palin turn out to be a good pick for McCain?  Looks good so far.  Will Obama be able to win and keep those disillusioned Hillary supporters in the team?

Questions for our strategists tonight, Todd Harris, Republican strategist who was John McCain’s communications director, and Steve McMahon, who’s a Democratic strategist who’s worked with Howard Dean.

Gentleman, have you been dragooned in action, Todd, to help brief the governor of Alaska on what John McCain thinks?  Because I understand there’s an underground briefing commencing, where they’re going to tell the good governor—and I really—everybody likes her, obviously, it’s not about liking her—to fill her in on what John McCain thinks.  She doesn’t know it, apparently.

TODD HARRIS, REPUBLICAN STRATEGIST:  Well, you know, obviously, when

she’s going to be traveling around the country, she’s going to have to speak about his record, and I think it’s only appropriate that they would take some time to brief her up on that.  And I’m certain that over the next couple of weeks, the press is going to be pounding her and the campaign, wanting to know where the access is.  There’ll be a lot of process stories about, Why isn’t she talking to reporters?  There will be a lot of noise that voters, frankly, don’t really care about.

And for as frustrated as the press is going to be, it’s a smart move by the campaign because voters, like I said, don’t care about these process stories, but if she goes out and makes a mistake, that is something that they’ll care about and that’s something that will haunt them for a while.  So I think this is a smart move.

MATTHEWS:  As an American, are you happy with the idea that a candidate for vice president of the United States has to be protected from the nasty boys and women in the press corps?  Are you happy...

HARRIS:  It’s not a question of...

MATTHEWS:  ... with the idea that somebody has to be in a cocoon on the way to the presidency or the vice presidency?  You happy with that?

HARRIS:  Look, this is a woman who can wrestle a moose and has taken on the big oil companies in Alaska.

MATTHEWS:  Oh!

(LAUGHTER)

HARRIS:  I don’t think—I don’t think she’s afraid...

STEVE MCMAHON, DEMOCRATIC STRATEGIST:  Todd!  Todd!

HARRIS:  ... of any reporters.

MATTHEWS:  OK, go ahead.  Take over, Steve.

MCMAHON:  Todd, come on.  Listen, Todd, I know that—I know that you were out late last night and you may not be thinking clearly, but it’s not a process story.  It’s not a process story if Sarah Palin can’t answer questions about the issues that she might face as vice president, or heaven forbid, as president.  And I think that the American public is going to be very interested in finding out whether or not she knows not only what John McCain thinks but what it is that John McCain has promised the American people and the direction that John McCain and the Republicans want to take the country.

And she’s going to have to know foreign policy.  She’s going to have to know all kinds of things.  And she better learn quickly because the reporters are going to expect from the “Straight Talk Express” a little bit of straight talk and some answers to some simple questions.

MATTHEWS:  When you do think, Todd...

HARRIS:  Well, look...

MATTHEWS:  No, I want to ask you a straight question.  Pretend your an average American with no partisan zeal here.  Do you believe, at some point in the coming months, in September, there comes a time when this candidate for vice president of the United States, a heartbeat away from a 72-year-old president, 73-year-old president, has to answer tough questions of tough journalists?  Or do you believe it’s fair to keep her away from them?

HARRIS:  No, no, no.  She—no, she’ll have to go through the whole media gauntlet.  There’s no question.  I know that everyone in the press is chomping at the bit right now for her to start, but look, she was just put on the ticket a couple days ago and...

MATTHEWS:  OK, give me a day.

HARRIS:  There will...

MATTHEWS:  Give me a day.  When should she be out there?

HARRIS:  Probably about two weeks or so.

MCMAHON:  How about tomorrow, Todd?  How about tomorrow?

(CROSSTALK)

MATTHEWS:  All right.  Two weeks sounds right.

MCMAHON:  There are 60 days left...

MATTHEWS:  Two weeks—no, no.  Well, two weeks will be fine.

MCMAHON:  There are 60...

MATTHEWS:  Hey, look, if she starts doing “Meet the Press” in two weeks, that is a profound development, don’t you agree?  Steve, if she faces the toughest journalist in two weeks, is that good enough?

MCMAHON:  By the way, if she goes on “Meet the Press” and she faces the toughest journalists in two weeks, I’ll be surprised.  I’ll be amazed.  Todd, I’ll buy you a beer.  I don’t think it’s going to be two weeks...

HARRIS:  I don’t need any more beer!

MCMAHON:  ... before she faces the tough ones—OK...

MATTHEWS:  OK, let me—let me ask you a tougher...

MCMAHON:  And I think it should be sooner before she starts answering questions.

MATTHEWS:  OK, let’s look at the latest ABC poll.  It’s interesting how the public is quick to make judgments here.  If you look at likability, favorability, unfavorability, they’re about the same.  Even though she’s the new person on the block, look at that, 50 favorable, 37 unfavorable.  A lot of that’s just partisan attitude people have.  The other one, Biden, 54-30.  He’s pretty good on that, actually -- 33 low on unfavorability in a national contest.

Now let’s look at the hotter question—preparation, right experience.  Does this person have the right experience?  Fifty percent, a plurality, say she doesn’t have the right experience, whereas Biden’s about 3 to 1 on the veteran status there.

Is that an opportunity for the Democrats, Steve McMahon?

MCMAHON:  Yes, it is an opportunity for the Democrats.  And frankly, you know, notwithstanding the fact that she gives a great speech and she can read a teleprompter like a pro, she’s going to have to answer questions.  She’s going to have to demonstrate that when she is a heartbeat away from the presidency, she’s ready to take over that office, if and when that time comes.  Forty-two percent of the public right now believes that she’s up to it, even after her stellar performance.  I think, Todd, you had your big night last night, and it’s all downhill from here.

MATTHEWS:  Todd Harris?

HARRIS:  Well, I think it’s funny that Steve is, like, denigrating the fact that she’s a great speaker because the top of your ticket, Steve, that is his one and only qualification to be president.  I mean, we can debate all day long...

MCMAHON:  But Todd, that’s not true.

HARRIS:  ... our number two.  But at the top, Steve...

MCMAHON:  Todd...

HARRIS:  Hold on.  Steve, at the top of your ticket, this is a guy that was in the Illinois state senate, got elected to the U.S. Senate and immediately started running for president.  So I will happily take the experience in terms of change and reform of McCain and Palin than Barack Obama.

MCMAHON:  And I’ll acknowledge that Senator Obama gives a great speech.  But I will tell you this, 36 million voters or 37 million voters have vetted this guy.  He was out there for two-and-a-half or three years answering every single question that came.  He beat Hillary Rodham Clinton and the Clinton machine.  That’s no easy task.  This is a man who’s...

MATTHEWS:  Well, let me ask you about an objective thing...

MCMAHON:  ...  (INAUDIBLE) president of the United States, and he’s going to take—go ahead.

MATTHEWS:  Let me go to something objective, a hard fact.  Churchill used to say that, if you don’t look at the facts, they will look at you.

One of the facts looking at us this morning now is the new unemployment rate.  It has spiked to 6.1 percent, the highest in five years. 

Todd, you know, I think voters do look at objective things, not just personalities and experience levels.  They go, do we want a change or not? 

How can the Republicans run for reelection for a continuation of their contract with the American people with a 6.1 percent unemployment rate? 

HARRIS:  Yes, well, this is exactly why you saw John McCain take the Republican Party to the woodshed last night.  He understands that the Republican Party, as it’s currently constituted in Washington, has not been meeting because of some of these scandals, because of runaway spending, has not been meeting and addressing some of the problems of everyday working Americans. 

MATTHEWS:  Well, then why reward them?

HARRIS:  John...

MATTHEWS:  Why reward a party that has failed, then?  I don’t get it.

HARRIS:  Because John McCain has been as critical as any single person in Washington about all of that excessive spending. 

But you also, last night, saw Senator McCain talk about his Jobs For America program, a program that’s going to reorientate our community colleges to train people for the jobs of the 21st century.

MATTHEWS:  Yes. 

HARRIS:  And in an economy—hold on—hold on—in an economy where we are bleeding jobs...

MATTHEWS:  Yes. 

HARRIS:  ... you can either do that, or you can do what Senator Obama wants to do, which is to raise taxes on small business, raise the corporate tax rate, which will only bleed even more jobs out of our economy. 

(CROSSTALK)

MATTHEWS:  Todd, did you ever see the movie “Mrs. Doubtfire”?  Did you ever see the movie “Mrs. Doubtfire”, where the guy fails—Robin Williams fails as a husband, so he comes back dressed...

HARRIS:  Yes. 

MATTHEWS:  ... as a housekeeper, and he gets a job, so he could have the responsibility for the kids again, having failed them as a dad and as a father and as a husband. 

Is what John McCain’s doing and the Republican Party doing out there in Saint Paul coming back as Mrs. Doubtfire? 

(LAUGHTER)

MATTHEWS:  We failed in our role for eight years.  We have got a new costume on.  Accept us and give us custody of the country again because we look a little different. 

Your thought on this, Steve McMahon? 

(LAUGHTER)

(CROSSTALK)

MATTHEWS:  It is the Mrs. Doubtfire strategy. 

(CROSSTALK)

MCMAHON:  It is a Mrs. Doubtfire strategy.

You would think, listening to the speech last night, that Senator McCain had never met George Bush.  Instead, Senator McCain has been in Washington for 26 years now.  And, for the past four years—or past eight years—he’s supported just about every single thing that George Bush has brought down the pike. 

So, if there have been failures—and there have been many—John McCain has every bit as much responsibility for them as George Bush, because John McCain supported George Bush 90 percent of the time. 

As Senator Obama said, this election is about whether or not we want to take a 10 percent chance on change.  I think most people don’t. 

(CROSSTALK)

MCMAHON:  They want change.  And John McCain is not offering the kind of change that people want. 

MATTHEWS:  Todd—Todd, how many times last night did John McCain mention the name Bush, the word Bush? 

HARRIS:  Well, you...

(CROSSTALK)

MATTHEWS:  The word Bush.

HARRIS:  If you were to play a drinking game...

MATTHEWS:  One word.

HARRIS:  If you were to take—play a drinking game and take a shot every time someone said the word Bush at that convention, you would end the evening disappointedly sober. 

(LAUGHTER)

HARRIS:  I don’t think it’s any—I don’t think it’s any surprise...

(LAUGHTER)

HARRIS:  ... that there weren’t a lot of Bush references.

MATTHEWS:  How about Cheney?  How about Cheney?  Is like—is Cheney still around?  I mean, he’s in the witness protection program.

I didn’t hear the word Cheney.  I didn’t hear the word Bush. 

But here’s the funny one Todd—and it’s not so funny—I didn’t hear the word Republican much. 

HARRIS:  Well, look, like I said, John McCain took his party to the woodshed last month.  It’s—it’s not—it’s no secret that the Republican brand right now is not all that popular, which is we, by rook, by crook, or just dumb luck, ended up with the one nominee for our party who has consistently been a maverick, consistently fought for reform, and taken on his own party in Washington, which is something that Barack Obama certainly cannot say he’s ever done. 

(LAUGHTER)

MATTHEWS:  Steve and Todd, thanks. 

Steve, they need you.

MCMAHON:  For 26 years, though...

MATTHEWS:  They need you, Todd.  They need you, Todd Harris. 

(CROSSTALK)

MATTHEWS:  You have got to get out of this commentary job.  You have got to get back over to the business of the workbench over there. 

Up next, NBC News’ Brian Williams is going to make a call.  He’s out here in L.A. as well.  He’s doing some good work out here on the cancer front.  Let’s talk to him about last night’s show, including the balloon show last night.  The troops got hit pretty hard by balloons last night.

We have got to talk about that.

You’re watching it, HARDBALL, on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

What did the McCain—or the Obama campaign think about McCain’s speech last night at the Republican Convention? 

Bill Burton, let me ask you about that. 

I think there was a very hard charge from the other side.  Senator McCain said, look, I have worked across the aisle and gotten things done. 

And we all know he has.

Has your candidate ever done that? 

BILL BURTON, OBAMA CAMPAIGN NATIONAL PRESS SECRETARY:  Absolutely. 

And John McCain knows it.  His colleagues in the Senate know it.  He’s worked—Barack Obama’s worked with Dick Lugar on issues like nuclear proliferation.  He’s worked with other Republicans on ethics and lobbying reform.  He’s been there as one of the most bipartisan, work-across-the-aisle senators that they have got. 

But, look, I have got to say, on John McCain’s speech last night, what he did was, he missed a huge opportunity.  And when I found out today that more people watched his speech than Barack Obama’s, I thought, that’s great news, because people can see that John McCain is for the same programs that George Bush is. 

He had a huge opportunity last night to tell the American people, in straight and unequivocal terms where he differs from George Bush when it comes to the economy, and he didn’t take the opportunity.

We were—we—I think that the American people want to know, how are you going to be different than George Bush?  How are you going to move our economy in a different direction than we have seen over the course of the last eight years of the Bush administration that John McCain has supported 90 percent of the time? 

I just don’t think the American people are willing to take a 10 percent chance on change. 

MATTHEWS:  Some people were also watching “The O’Reilly Factor” the other night. 

Let’s take a look at your candidate, Barack Obama, with Bill O’Reilly. 

(BEGIN VIDEO CLIP, “THE O’REILLY FACTOR”)

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL NOMINEE:  I think that the surge has succeeded in ways that nobody anticipated, by the way, including President Bush and the other supporters. 

(CROSSTALK)

BILL O’REILLY, HOST, “THE O’REILLY FACTOR”:  But if were up to you, there wouldn’t have been a surge. 

OBAMA:  Well, look, he...

O’REILLY:  No, no, no, no. 

OBAMA:  No, no, no, no, no.

O’REILLY:  If it were up to you, there wouldn’t have been a surge. 

OBAMA:  No, no, no, no.

O’REILLY:  You and Joe Biden, no surge. 

OBAMA:  Hold on a second, Bill. 

Bill, what I have said is, I have already said it succeed beyond our wildest dreams. 

O’REILLY:  Right.  So, why can’t you just say, “I was right in the beginning, and I was wrong about the surge”? 

OBAMA:  Because there’s an underlying problem with what have we done. 

We have reduced the violence.

O’REILLY:  Yes.

OBAMA:  But the Iraqis still haven’t taken responsibility.

(END VIDEO CLIP)

MATTHEWS:  What do you make of that?  That’s been blown up, Bill, as an acknowledgement that John McCain was right about the surge and your guy was wrong.  In fact, he acknowledged that he was wrong, in the sense that he said that this has succeeded beyond the wildest expectations.  I assume would that would his own expectations. 

(CROSSTALK)

BURTON:  Well, let me first take this as an opportunity to plug your colleague Keith Olbermann.  Barack will be on with Keith on Monday night, talking about some of the same issues.

But what Senator Obama was talking about yesterday with Bill O’Reilly is the same thing that he’s been talking about for months, which is that, if you put more troops in Iraq, of course you’re going to be able to decrease the violence, and, of course, the brave young men and women who are serving in our armed forces are going to be able to make—make progress, in that sense. 

But, still, I don’t think—and Senator Obama doesn’t think—that the sort of political advancements that we needed to make in order to advance our strategic interests there in Iraq have been able to be achieved. 

MATTHEWS:  OK. 

BURTON:  But the bottom line is, we have got to get our combat troops out of Iraq, get them into Afghanistan, you know, get the appropriate number into Afghanistan, so that we can take the fight to the war on terror exactly where it is, and take on those terror networks that have gone ignored far too long. 

MATTHEWS:  Thanks, Bill—Bill Burton speaking for the Obama campaign.  Thanks for joining us tonight. 

Nancy Pfotenhauer is a spokesperson for the McCain campaign. 

Let me ask you this.  I—I am—I am amazed at the ability of a candidate for president to go before the American people and give a very good speech, but in that speech is a kernel of confession, a statement of what went wrong the last eight years.

Isn’t your candidate running to continue Republican rule in the White House?

NANCY PFOTENHAUER, MCCAIN CAMPAIGN POLICY ADVISER:  Well, you know,

Chris, what—what John McCain’s running to do is to change this country and get it back on track.  He’s always been the conscience of—conscience of Washington, rather than a creature of Washington, which is why he’s broken the China over the years whenever it needed to be done, and taken on members of his own party, as well as the Democratic bosses.

And, you know, Barack Obama just doesn’t have that record.  I was listening to your earlier guest.  And, you know, it’s a joke.  They have got nothing to—to list, because the man started running for president as soon as he got to the U.S. Senate. 

And, you know, they reel out a list of things that were—you know, some of which were voice votes, for goodness’ sake. 

MATTHEWS:  Yes. 

PFOTENHAUER:  And, when he was in the state legislation, he—you know, he voted present on -- 130 times, which was ducking contentious issues and challenges, rather than being a profile of courage that John McCain has always been. 

MATTHEWS:  Well, the reason I ask you is because I have been in Washington a long time, as you know.  And I know how the parties matter.  People say, parties don’t matter.  They matter, because they’re the pool from which you draw your people. 

You’re a Republican.  Most times, when people hire people to run an administration, they hire the people of their party.  If John McCain gets elected—and I think it’s a 50/50 shot—he goes into Washington, he starts recruiting, he’s going to hire all the old people.  He’s got John Burton from the—or John Bolton from the U.N.

(CROSSTALK)

MATTHEWS:  All the usual suspects come back in.  All the people at the gala, the inaugural parties, will be the same Republican people that were there for the Bushes, won’t they? 

PFOTENHAUER:  Chris, you should not put...

MATTHEWS:  Won’t they be the same people?

PFOTENHAUER:  You wouldn’t—you should not put money on that.  You know that John McCain has always—it doesn’t matter what your party is.  If it will help solve the problem, he’s going to work with you. 

And that’s part of why some folks have viewed him with skepticism, if you will, because he would work with Ted Kennedy on immigration, he will work would Joe Lieberman on real climate change. 

MATTHEWS:  But will he build his government with Republicans from the usual crowd of Republicans, or go to a new pool of people?  Will he pick them among the usual crowd? 

PFOTENHAUER:  I think...

MATTHEWS:  Because, if it’s the usual crowd, it’s the same old deal, isn’t it? 

PFOTENHAUER:  You know what, Chris?  He’s going to choose the best man or woman for the job, and he proved it when he—when he chose Sarah Palin to be his running mate. 

And she, too, is just like John, in that she’s a maverick.  She’s someone...

MATTHEWS:  OK. 

PFOTENHAUER:  And those aren’t just empty words applied to these two people.  These aren’t talking points.

MATTHEWS:  I know.

PFOTENHAUER:  They’re real.  Their record stands out.

MATTHEWS:  You know what I’m trying to do here, Nancy?  I’m trying to get him to commit on this show through you it’s not going to be the same old crowd that ran the country the last eight years...

(LAUGHTER)

MATTHEWS:  ... because you can’t confess failure, and ask for more responsibility, unless you’re going to change something.  And you say it’s going to be a different crowd, a different crowd.

(CROSSTALK)

PFOTENHAUER:  And, Chris—and, Chris, it’s not like he, you know, got an election-year conversion and started complaining about the way things have been done. 

MATTHEWS:  OK. 

PFOTENHAUER:  You and I know this man—sometimes, almost alone—stood on the floor of the U.S. Senate...

MATTHEWS:  OK. 

PFOTENHAUER:  ... and called out members of his own party, as well as their Democratic colleagues.  And I might point out, the Democratic Congress has an approval rating that has—that is significantly below President Bush’s right now, and for good reason.

MATTHEWS:  Nancy—I’m sorry—Ms. Pfotenhauer, thank you very much

Pfotenhauer.  Thank you so much.  You have made the case. 

PFOTENHAUER:  Thanks, Chris. 

MATTHEWS:  You have made news.  It will be a new crowd running Washington next year, if he wins. 

(LAUGHTER)

MATTHEWS:  Thank you. 

Up next, NBC’s Brian Williams will be here.

Plus, by the way, I’m going to be on “The Tonight Show With Jay Leno.” 

That’s why I’m out here in L.A. tonight.  I love doing “Tonight Show”s. 

Stay up tonight, 11:30, lots of jokes.  Then, I’m on with some movie star. 

You will all like it.

Anyway, you’re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MIKE HUCKMAN, CNBC CORRESPONDENT:  I am Mike Huckman with your CNBC

“Market Wrap.”

And stocks ending a rough week on a mostly positive note, the Dow Jones industrial gaining 33 points, the S&P 500 picking up five points, while the Nasdaq just lost three points.  For the week, the Dow is down almost 3 percent.  The S&P 500 fell more than 3 percent, and the Nasdaq dropped more than 4 percent. 

The day started, though, with disappointing news, that the nation’s unemployment rate hit a five-year high of 6.1 percent in August, as employers cut 84,000 jobs.  It was the eighth straight month of job losses. 

But it isn’t all bad news today.  Oil dropped another $1.66, closing at $106.23 a barrel.  That’s the lowest level since April 4. 

And “The Wall Street Journal” is reporting that the Treasury Department is finalizing a deal to shore up mortgage giants Fannie Mae and Freddie Mac.  This plan reportedly includes changes in senior management at both of the companies. 

That’s it from CNBC, first in business worldwide—and now back to

HARDBALL. 

MATTHEWS:  Welcome back to HARDBALL. 

Last night’s speech by John McCain capped off two of the most exciting weeks we have had so far this in presidential campaign. 

For a look ahead, let’s bring in “NBC Nightly News” anchor Brian Williams, who is out in L.A.

Brian, I want you to look at this scene from the convention hall last night.  It was a moment of frivolity and good cheer. 

(BEGIN VIDEO CLIP)

ANDREA MITCHELL, NBC CHIEF FOREIGN AFFAIRS CORRESPONDENT:  I am

somewhere, somewhere on the floor of this convention, surrounded by balloons and confetti. 

BRIAN WILLIAMS, ANCHOR, “NBC NIGHTLY NEWS”:  I have been in Ramadi

with that woman with automatic weapons going off.  That didn’t stop her. 

But it appears Mylar has stopped Andrea in her tracks. 

KEITH OLBERMANN, HOST, “COUNTDOWN”:  We have lost a cameraman, too.

(LAUGHTER)

WILLIAMS:  Another senseless victim of the balloon drop. 

MITCHELL:  At least this crowd of Republicans knows how to throw a party. 

(END VIDEO CLIP)

MATTHEWS:  Brian, you have always paid attention to the staging of these things.  Republicans do seem better at balloons.  What does that tell you? 

WILLIAMS:  Huge, absolutely huge. 

And, back at the hotel, I was talking to a couple delegates in the elevator, in the kind of balloon afterglow.  Chris, I had a theory, looking up at those rafters last night—I tend to be balloon-centric at these kind of events—but I figured, we didn’t hear from Cheney and Bush, remember.  We had this truncated convention. 

Were there more than one balloon drop—was there more than one balloon drop on the schedule?  Did we have balloon hoarding, in effect, because of the shortening of the convention, so, we had a—a massive release that wasn’t scheduled?

And you had these locally heavy pockets of balloon-fall where our own Andrea—I understand search and recovery teams have located her today, with the help of dogs.  But it was dicey there for a while. 

MATTHEWS:  You know, in addition to the hoopla—there it is.  We’re watching it again.  It seemed like something almost unprecedented happened last night.  A candidate for a political party, its nominee for president, basically offered up a confession and said, there’s areas where we have failed, in terms of spending, over spending, in terms of corruption, in terms of failure to address the energy situation, but re-elect us.  That’s kind of a dramatic switch or pivot, if you will. 

WILLIAMS:  And the other embedded comment that was interesting and a lot of people found fascinating was the need to stay ahead of history.  A lot of people these days are of a mind, you know, we’re not the country we used to be, and on our watch, the country our dads built by hand during and after World War II has changed.  And I found that interesting.  Yes, there was a confession—I was interested listening to all of you guys who kind of analyze the speech.  A lot of people said that that personal, personal portion of the POW years perhaps should have gone up higher and not gone where it was put, that a lot of it was what our campaign embeds confirm was boiler plate what they have heard before in the campaign. 

Look at the television ratings.  Look at how Even Steven we are, what some people call these two nations going now into the general election season. 

MATTHEWS:  Astounding performance by the public last night, let alone the industry we’re in.  Something like 40 million people took the time to learn more about one of the candidates.  Again, I think the debates are going to draw double that number.  We’ll see.  Tell us about what you’re doing tonight off the political beat. 

WILLIAMS:  Yes.  I should explain the noises and lights and all that going on behind us.  You heard Homer Simpson a while ago.  This is a rare event.  The three networks, when they get together to form a road block and clear out live television, so that network television viewers can’t watch anything else.  They’ve done it before after Katrina, 9/11.  What do those have in common?  They were national emergencies. 

Tonight is called stand up to cancer, 8:00 Eastern time, 8:00 out West, because we have declared cancer an emergency.  We lose 1,500 of our fellow citizens a day.  We lose an American every minute to this disease.  So it is about time we did this. 

This is about cancer research.  It’s a reality check on where we stand.  It’s a blunt effort to raise money using celebrities.  And the fun part is I’m going to be joined by my friends and colleagues of the other networks, Katie Couric and Charlie Gibson.  They’re doing their newscast tonight.  Charlie’s up here on the balcony.  Katie’s about 50 yards away from us.  Then we’re going to come together on the special. 

A whole lot of celebrities answering phones.  If you call in from home, you’ve got a better than even chance of talking to Jennifer Aniston or Forrest Whitacker or any number of a laundry list of stars.  Really going to be worth tuning in for, Chris.

MATTHEWS:  Would you tell Jennifer Aniston that she has a fan who works on HARDBALL?  Just drop my name over there, if you don’t mind. 

WILLIAMS:  If I see her, I’ll—yes, I’ll tell her. 

MATTHEWS:  OK.  I like movie stars.  Thanks very much, Brian.  Good like tonight with a great cause.

Up next, the politics fix.  What a week we had, by the way.  What we should expect to happen next.  This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  It’s time now for the politics fix with MSNBC political analyst Michelle Bernard, with whom I spent the week outside, facing the lions, including some very extraordinary people out there, and the Politico’s Roger Simon.  Roger, you’re a vet.  Here’s the question: was there too much criticism of the media for its scrutiny of the new Republican candidate for vice president? 

ROGER SIMON, THE POLITICO:  Oh, absolutely.  I’m of the school that the only dumb question is the one you don’t ask.  If Sarah Palin can’t stand up to a few questions, she can’t stand up to the vice presidency.  I realize that some things are in bad taste, some things are out of bounds.  She’s running for the second highest office in the nation.  I think she’s got to expect a little scrutiny.  There’s absolutely nothing wrong if you get an improper question to say, I won’t not dignify that question with an answer.  Next question. 

Instead, they’re just hiding her away from the press.  That never works. 

MATTHEWS:  What I have a problem with is the notion of partisanship in this regard.  No one took worse heat than Gary Hart on his private behavior.  No one got more focus for 20 years than the Clintons, in terms of their private lives.  Then to say that somehow the press is being partisan by asking the most obvious questions that just jump out at you.  Anyway, that’s my view.  Your thoughts, Michelle?  Does there need to be a special standard on the basis of gender or just the new kid on the block, if you will?  Is there any basis for special standard here? 

MICHELLE BERNARD, MSNBC POLITICAL ANALYST:  There’s no basis for a

special standard here.  There weren’t just accusations flying of partisanship.  There were accusations of flying of sexism also.  You’ll notice that the only person that wasn’t complaining about sexism was Sarah Palin.  She is on the ticket for the second highest office in the land, and she has to absolutely expect not just some scrutiny, but a lot of scrutiny.  That’s the way the cookie crumbles.  We said it when Senator Clinton was running for president on the Democratic ticket.  You’ve got to take your licks like the men take their licks.  If there is sexist behavior, or somebody says something out of bounds, call it out of bounds, but keep on going. 

What would be discriminatory would be to treat her differently than you would treat any other man running for president or vice president of the United States. 

MATTHEWS:  OK, let’s get out to the margins here.  An AP Associated Press story came out last night.  It was not a blog or anybody else outside the mainstream.  The Associated Press did a story that she, the governor of Alaska, had been a freshman basically—been enrolled at six different colleges over the space of seven years.  Is that the kind of inquiry the public needs?  Back in the college days? 

SIMON:  It’s hard to make an argument—I don’t care how many schools she went to.  I don’t care if she was Phi Beta Kappa or flunked out.  But it’s hard to argue for some kind of cone of silence or right to privacy when you are running for president or vice president, especially when the your campaign pushes all the cutesy poo stuff about your private life.  Do we need to know that she likes moose burgers?  Do we need to know that she sunk the winning free throw at her championship basketball when she had a stress fracture in her ankle?  Do we need to know any of that?  No, the campaign pushes it because it makes her human.  Fine with me.

But there’s all sides to being human being, including how many colleges you went to, apparently. 

MATTHEWS:  Michelle, when do you think that she should be available to tough scrutiny by people like Roger, serious journalists who write for serious organizations, not “US Weekly,” serious news organizations?  When should they have a shot at her, within a week, within two weeks?  We’ve only got two months left. 

BERNARD:  I think the day after her son deploys to Iraq, Sarah Palin should be available for press scrutiny and to talk with very serious journalists, not “US Magazine” or the “National Enquirer,” but talk with the mainstream media about her candidacy and what the Republican party’s vision for the future of America looks like.  I do think the American public will be forgiving and will understand if she spends the weekend with her son before he leaves for Iraq. 

MATTHEWS:  What do you think, Roger, about information questions?  There’s a fellow up in Boston that used to do this for a living.  You know, name the heads of state of the top five countries.  I’ve always been of the believe that if those aren’t central, reasonable questions, the reporter looks stupid.  You ask someone who is the head of Taiwan, a newcomer to national politics would know.  You ask them who the chancellor of Germany is, they better know.  They ought to know who the prime minister of Great Britain is, the president of France. 

Obviously, everybody in our business would love to see a candidate for president or vice president spell potato with an E at the end.  That’s not going to happen in our lifetime.  What do you think?  How do you get the information questions, without being caught asking a teacher’s question instead of a reporter’s question. 

SIMON:  I’m sympathetic to when candidates flub the answers to those questions.  I would flub a lot of the answers, if not most of the answers to that question.  That’s one of the reasons I’m not running for vice president.  It’s one of the reasons that the campaign is keeping her under wraps.  It’s not just all about Trooper-gate and the stuff in her family’s personal life.  It’s how prepared is she?  What countries has she traveled to?  What states has she traveled to?  What is her depth of knowledge? 

I’m sympathetic to the fact that her son is deploying to Iraq, but I think she should have been put out a week ago.  I think she should have been put out no later than this weekend on the Sunday shows.  I mean, she gave a terrific speech.  She gave the best speech at the convention.  In fact, that and the balloon drop were about the only two high points of the convention.  But you can’t just have a staged, set speech that you can memorize and rehearse and say OK, that’s the campaign.  Now, all she’s going to do is give speeches. 

She’s got to answer some questions.  The American people want to see if she can handle herself. 

MATTHEWS:  She’s going to have to debate Joe Biden.  That’s an hour and a half on national television.  I’ll be right back with you, Michelle.  You pick up when we come back.  The round table, more of the politics fix. 

You’re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. JOE BIDEN (D), VICE PRESIDENTIAL CANDIDATE:  The silence of the

Republican party was deafening.  It was deafening on jobs, on health care, on environment, on all the thing that matter to the people in the neighborhoods I grew up in.  Deafening. 

(END VIDEO CLIP)

MATTHEWS:  What a contrast.  We’re back with the round table.  You saw that, Michelle.  That’s Joe Biden, who is going to have to sit down on October 2nd, on national television, for 90 minutes against this very popular new face in American politics, the governor of Alaska.  Will he be able to bring the issue of jobs, the 6.1 percent unemployment rate that spiked up today?  Will he be able to bring a hard fight to her?  Will he have to pull his punches on the new comer? 

BERNARD:  You know what?  I think this is a woman who he can pull hard punches with.  He can’t be rude, but I think he’s going to able to pull hard punches, because after Wednesday night’s speech, I have no doubt that she’s going on the offensive and she will be coming in full force and ready for this debate.  It will be an interesting contrast though, and a discussion, because I fully expect that Sarah Palin is going to focus on what we heard her talk about on Wednesday night and what we heard from Senator McCain on Thursday.  It will be taxes.  It will be the economy.  It will be questions about energy independence, national security and terrorism. 

We’ll see something very different from Joe Biden.  Both of them, if you think about, have a very interesting, populist message.  For the Democrats, it’s Robin Hood; we’re going to steal from the rich and give to the poor.  For the Republicans, what Sarah Palin told us on Wednesday night is it’s a different type of populism.  The government has stolen your money.  I’m going to go in.  I’m going to take it back and I’m going to give it back to you.  I can’t wait to see the debate between the two of them and how Americans in Scranton, for example, will react to it. 

MATTHEWS:  I love the way you describe the Democratic redistributive policies, but I don’t think they ever call themselves Robin Hood outright.  They have to shoot people in the forest.  Let me ask you, what happens, Roger, when the governor of Alaska says, nice try, Joe.  You’ve been there 40 years.  You haven’t solved the problem.  Why are you going to do it next year. 

SIMON:  That’s your strongest point.  Of course, she’s running with someone on the ticket who’s been in Washington a pretty long time too.  One of the many internal conflicts of this ticket, part of the ticket is an outsider, part of the ticket is not an outsider.  Part of the ticket says he’s running against the Republican party, but he’s for the Republican party.  He’s the head of the Republican party.  John McCain’s biggest selling point is he has the experience to protect us against terror.  It worked in 2004 for George Bush.  He wants it to work again. 

But then you say, what happens if something happens to him?  Does the second person on the ticket have all this experience that McCain talks about?  It’s a really tough conflict within this one ticket. 

MATTHEWS:  Maybe we should have a debate between McCain and Biden and one between Barack Obama and Governor Palin.  That would be more interesting.  Thank you, Michelle.  Thank you, Roger.  Take a break this weekend.  What a two weeks it’s been.  What a toboggan ride.

Join us again Monday night on HARDBALL at 5:00 and 7:00 Eastern.  I’ll be a guest tonight on “The Tonight Show” out here in LA with Jay Leno.  So stay up tonight.  Have some peanut butter and crackers and a Coke.  Stay up and watch this.  It’s time for RACE FOR THE WHITE HOUSE now, with David Gregory.

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