HARDBALL
October 2, 2008
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
Guests: Roger Simon, Steve McMahon, Todd Harris, Debbie Wasserman Schultz, Douglas Holtz-Eakin, Mike Allen, John Heilemann
CHRIS MATTHEWS, MSNBC ANCHOR: Two hours until ring time in St. Louis.
Let's play "HARDBALL."
Good evening. I'm Chris Matthews. Welcome to "Hardball" tonight from the campus of Washington University in St. Louis, the host of the vice presidential debate tonight. The crowds are here as you can tell enthusiasm is high.
In just two hours it all gets started. It is not often that the under card, the VP card is more highly anticipated than the main event. But that may be the case tonight. Alaska Governor Sarah Palin and U.S. Senator Joe Biden take center stage in their first and only debate tonight.
Sarah Palin has stumbled badly in the last two weeks. The question is does she swing for the fences to protect her reputation or go for a bunt and avoid trouble?
MSNBC will have live coverage of the debate beginning at 9:00 p.m. eastern time. At 10:30 NBC's David Gregory will join me for a post-debate coverage. Then at 11:00 it's "Countdown with Keith Olbermann." Then at midnight we'll have a late night version of "HARDBALL" with analysis of how the vice presidential candidates did to night.
Now let's get into what the stakes are for Governor Palin. MSNBC's Joe Scarborough joins us right now. He's of course the host of "Morning Joe." And Roger Simon is with very prestigious news organization, "The Politico."
Joe, let me tell you, Roger and Joe, take a look now at Sarah Palin, in an interview on CBS News with Katie Couric.
(BEGIN VIDEO CLIP)
KATIE COURIC, CBS NEWS ANCHOR: What previous vice president impresses you the most and why?
GOV. SARAH PALIN, ® VICE PRESIDENTIAL NOMINEE: Oh, my goodness. All right, it would have to be a vice president-just a candidate and that would have Geraldine Ferraro, of course. But that's an easy one for me because she's one who first shattered part of that glass ceiling anyway in American politics. So it would be she as a candidate.
COURIC: What about as an actual vice president, if you had to name one?
PALIN: My goodness.
I think those who have gone on to the presidency; George Bush Senior having learned the ropes in his position as VP and then moving on up.
(END VIDEO CLIP)
MATTHEWS: I guess we saw a vice presidential candidate, Joe, as aspirations for the big job. Let's be serious she likes George Bush Senior because he went on to be president. Do you think that's what we're looking at now? A person who sees herself on the way to the top?
JOE SCARBOROUGH, MSNBC ANCHOR, "MORNING JOE": Well, certainly a month ago when she gave her speech in St. Paul, a lot of Republicans were saying this is a woman that may never be vice president but she's probably gone to the front of the line to the presidential sweepstakes four years from now. A lot has changed in the past month.
And if you are Sarah Palin or John McCain you're just hoping-tonight you were talking about a bunt-you're just hoping that she can go into the old Dean Smith's office, the four corners and then she can stall for 90 minutes.
The McCain campaign has mishandled this launch horrifically. It's been terrible. She needs to survive tonight. And tomorrow you're going to start seeing her playing to the base, going on conservative radio almost exclusively and going to cities like my hometown, Pensacola, Florida, where they can draw out the base and protect her more until she is prepared to answer the tough questions. She's not right now.
MATTHEWS: Let's go to the questions tonight. First of all Roger, you pick up her and Joe will follow up right now.
I want to ask you the hottest question tonight. What is the test for Sarah Palin tonight? And I want you to choose the following topics which it is and among which of these is the key issue tonight.
Is tonight about brains? Is it about her knowledge? Is it about her personality? Is it about her political skill? Is it about her credibility as a candidate for president or a vice president's case? Is it about her ideology? What is it about tonight, Roger Simon?
ROGER SIMON, THE POLITICO: It is about her ability to become commander-in-chief and president of the United States.
MATTHEWS: No, you have to pick one. Is it brains? Is it about brains tonight?
SIMON: It is about competence. You had competence in there. Competence is a big question. I don't think it can be about just being warm and fuzzy and satisfying the base. I think Joe is right that she satisfied the base, but you can't get to be President of the United States with just the Republican base. This ticket has to reach out beyond that.
If Sarah Palin cannot demonstrate tonight she is competent to be vice president or president someday, I don't think she can be said to have contributed to the ticket.
MATTHEWS: Joe, let me run those questions by you again. Is it about brains tonight? Is it about knowledge? Is it about personality? Is it about politics? Is it about credibility? Or as you suggest, about ideology? She simply has to appeal to the right?
SCARBOROUGH: Well, the problem is right now if you listen to people like Kathleen Parker, she is losing the right quietly behind the scenes, even her own base is starting to get very nervous. She has to show that she has got the brains to be vice president of the United States.
She's got to explain how a woman who was a mayor of a small town took on the most corrupt Republican establishment in any state in America and then she succeeded over the past two years of getting an 80 percent approval rating.
Now Chris, you and I both know being a governor is a difficult job. You don't get 80 percent approval ratings without having a lot on the ball, without being intelligent. Unfortunate again, she has been miscast horribly by the McCain campaign.
She has looked like she didn't have competence in the Katie Couric interview. She has got to show that tonight. She has got to show the magic that got her to an 80 percent approval rating in Alaska.
She has got to show she is competent because that base which she can help bring to the polls like Karl Rove helped bring Evangelicals to the base in 2004, remember, that is what elected George W. Bush in 2004. They want to know as well as everybody else that this woman is competent to be vice president of the United States. And right now, a lot of them are not so sure that she is.
MATTHEWS: Roger, I wonder what their plan is here. They expose her to Charlie Gibson, then Shawn Hannity and then Katie Couric. It has gotten worse almost in each case.
Katie Couric asked her the wide open questions, what do you read? And she had a problem with that question. I don't know what could be easier. What is an easier question we could come up with besides what do you read?
Or is it a trick question?
SIMON: That one of all the questions is the most inexplicable since presumably she reads something every day. I'm sure she does. Where she really has fallen down is usually not on the first question. She usually has a talking point. She knows how to deliver from her playbook and important to be in Alaska where you can actually see Russia.
Where she gets in tremendous trouble-and where she got in trouble with Katie Couric is when she is asked a follow-up question. When she's asked explain what you mean by that. Why is it really important to be next to Russia? Give us an example of a Supreme Court case you disagree with. Tell us a specific newspaper you read.
A debate format may actually help her since the moderator is limited in the number of follow-ups she can ask. Sarah Palin doesn't do all that badly when asked a direct question. Where she does do badly is where she is asked to think on her feet.
MATTHEWS: You know, Joe, you and I know politics pretty well and we know that the issues that have confronted the right and the left for 50 years now have been around ideology, about the role of the government in our lives, the role of the courts in our lives.
People have been arguing about the Brown case, about the prayer in school case, about all these issues in our lives, usually having to deal with social issues like abortion rights or education.
When she was asked to name any court decision besides the abortion case in '73, she couldn't mention one. I thought that the moral majority had billed itself on the issue of prayer in school; how much they didn't want that court ruling to be in effect. How could you not have an opinion on the Supreme Court and call yourself a conservative?
SCARBOROUGH: Chris, I mean, how stunning. You are exactly right because that is the issue for conservatives. For the Evangelical conservative base that elected George W. Bush in 2004 that is the issue. He delivered with John Roberts. He delivered with Alito.
But Chris she doesn't have to go back to '73. She doesn't have to go back to '56. Just this year conservatives would have loved her to say I can't believe the Supreme Court gave the rights of habeas corpus to terror suspects. I can't believe this year, this same Supreme Court said that states couldn't execute a child molester that killed a 4-year-old girl after sexually molesting her.
There were so many things that she could have done that she chose not to do. And I have got to draw this parallel, she reminds me when I'm watching her speak like George W. Bush back in 2000. You sit there and say, okay, she is saying she is a conservative, but is there that ideological grounding?
What would you say if you asked her about Milton Friedman? What would she say if you asked about Hayek? What would she say if you asked her about what Ronald Reagan's overriding message was in 1976 and 1980? I don't think she would have the answers.
And when she says her favorite vice presidential candidate ever was Geraldine Ferraro, conservatives across America are saying, really? Really? How could you say that? I don't know that she is that ideological.
It may have just been a pursuit of power in Alaska. She certainly hasn't shown me a deep, ideological understanding about the battle between the individual between the individual and the state which, of course, lies at the heart of the conservative battle.
MATTHEWS: Let's take a look at this poll number. In the "Washington Post"/ABC News poll on the question of understanding complex issues; three out of four say Senator Biden gets it and half say Palin doesn't get it.
But here is a trickier one. Here is an opportunity for Palin tonight. But Biden and Palin are about even on the question of "understanding problems of people like you."
Roger, can she win tonight if she demonstrates she connects with average people and their concerns and doesn't get into the questions of knowledge or brains even?
SIMON: I think that's the most she can hope for. And I think if she gets through 90 minutes without her knowledge being questioned, which seems unlikely, but can connect with people on a one to one level then she'll have done well in a debate. That question of a person just like me or a person who understands me is what people tell pollsters, the main reason they cast their vote in the polling booth. It is an important question.
The trouble is it may not be a good time for that in America at a time with our financial system in collapse, when we are in two shooting wars and where wonkiness and where intelligence seems to have an increased value over feel good, what she says is Joe six-pack America. Her fallback position is sure you can stump me on these little gotcha you questions but I'm a regular person and the American people want that. This may be very a bad time in American history to do that.
MATTHEWS: Joe, let me touch you on that. Just to be balanced, Joe, it seems to me-is it a time, because these issues that we confront today are so complex, especially with the economy that we're not looking for the average Joe right now, or average Jane. Is that true or not?
SCARBOROUGH: In the end, I always found when I campaigned, Chris, and I know you have seen it time and time again that people vote for reasons that scare the hell out of elected officials. I remember in 1994 the first time I ran I stood around the polling place for about ten minutes and then said I have to get out of here if these are the people who are determining my future. Coming up and asking me these random questions. I got out of there and stayed away.
I think in the end it is a gut decision by voters. I don't know that wonkiness ever plays into that gut. I think it comes down to-as Roger said-the person who understands the situation I'm in, the person I can relate to, the person who is going help me, my family, my community, my country out.
MATTHEWS: Yes. It just seems to me that when you are being operated on it is nice to look up at the wall and see a really nice degree on that wall.
SCARBOROUGH: You are exactly right.
MATTHEWS: Thank you.
Much more from St. Louis coming up. What do Joe Biden and Sarah Palin need to do tonight? And must they avoid doing tonight?
Our strategists are going to join us, a Democrat and a Republican. It's getting close to the big event tonight. You're watching "HARDBALL" live from Washington U in St. Louis, only in MSNBC.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JOHN MCCAIN, ® PRESIDENTIAL NOMINEE: By the way, in case you missed it, Governor Sarah Palin's going to have a little debate tonight. I know she'd be pleased.
(END VIDEO CLIP)
MATTHEWS: Welcome back to "HARDBALL" live from St. Louis as we get ready for the vice presidential debate tonight.
Time for our strategists. Joining me are Steve McMahon, Democrat, Todd Harris, Republican. I want to ask, gentlemen, both of you this question, what is the test for Sarah Palin? You are laughing a lot tonight, Todd. We will get to the question about Joe Biden in a second.
But what's the test for Sarah Palin tonight? And I mean these questions to be tough. Is it about her brains, her knowledge, her personality, her politics, her credibility, her ideology or simply her composure before some tough questioning?
What would you say, Steve, it is about tonight? What is she being tested on?
STEVE MCMAHON, DEMOCRATIC STRATEGIST: It is about her knowledge because she clearly has ideologically pleased the right. She is obviously very smart. She's got an 80 percent approval rating so she talks well.
The question is whether or not she knows what she needs to know to be president of the United States and God forbid-I'm sorry, vice president of the United States and God forbid if something happened to John McCain, president. And I think her experience on CBS Evening News in the last few days makes people wonder. And tonight they're going to look for answers from her.
MATTHEWS: So you say she doesn't know what she's talking about?
MCMAHON: Well, no, listen.
MATTHEWS: I'm asking Steve-
MCMAHON: Listen, all I'm saying is she hasn't demonstrated that she knows what she is talking about. She may very well know what she is talking about and just be over-programmed. We don't know but she can't answer the simplest questions. And that is a little bit troubling as an American, not even as a Democrat.
MATTHEWS: Todd, what is it about tonight, brains, knowledge, personality? What is it about tonight?
TODD HARRIS, REPUBLICAN STRATEGIST: It's about two things tonight:
number one, it's her ability to literally reach through that television and connect with the average American voter. I promise you you're going to hear her talking several times tonight about how she is a mother of five kids, a baby with special needs, a daughter who is going to be a young mother, a son who is getting ready to go off to war in Iraq.
And the other thing that she's going to do tonight-that she has do tonight is put that Sarah Barracuda hat back on and take the fight to Barack Obama. The more she goes after Obama tonight the more she can make this debate about him, the less it is going to be about her.
MATTHEWS: You make it sound like the questions that emcees on quiz shows ask the contestants during intermission. Like, tell me what your family's like? What about the actual quiz here? What about her knowledge base. Is it important that she knows, as Steve says, that she knows what she is talking about? Is that important or not?
HARRIS: Yes. She's going to have to show some real substance tonight. But I think the Democrats in the media have succeed in lowering the bar so low that my guess is she will be well-briefed and well-prepared to talk about energy policy, talk about a couple of domestic issues that she dealt with as governor but then really take that hammer to Barack Obama.
MATTHEWS: You mean the Democrats like Kathleen Parker and Charles Krauthammer and David Brooks and David Frum, all of them being conservative commentators and columnists who say she has a problem being unprepared for this office. Steve, it hasn't been the lib labs that have been knocking her, it's been her own side of aisle that have been knocking her.
MCMAHON: Well, it's basically been Governor Palin providing all the ammunition for both the left and the right to question whether or not she knows what she needs to know to be vice president or president of the United States. And you know that is going to be the test tonight.
Gwen Ifill isn't going to ask her about her family. Gwen Ifill is going to ask her about issues. And Senator Biden is smart. He's very smart indeed. What he'll do is he'll answer questions and he'll say, you know, I would be interested to know what Governor Palin thinks about that.
And he'll lead her down a path where she has to look at the camera with a blank look on her face or she has to answer the question. So I think it is going to be a real test for her tonight. I think America is waiting to see if she knows the answers.
MATTHEWS: Let's talk about Joe Biden tonight. You first, Todd, what is Joe Biden's big hazard, what is his sand trap in golf terms tonight?
HARRIS: I think that his real danger is going to be to try to take advantage or exploit a potential gaffe that Governor Palin might make. He needs to almost ignore Governor Palin. At the end of the day tonight's debate is not about Palin, it's not about Biden; it's about McCain and Obama.
And my guess is that Biden will put his old prosecutor's hat back on and take the attack right to John McCain. He has to avoid looking condescending to Sarah Palin. So even if he sees the opportunity for a zinger, my guess is that he is going to avoid it.
MATTHEWS: Steve, can he do that, restrain himself when there is an opportunity looming in front of him to exploit it? Can he hold back? And should he hold back?
MCMAHON: I think he needs to. I think Todd is right. He needs to take the fight to John McCain. He needs to let Sarah Palin speak as much as possible. And I think he has got to avoid appearing condescending in any way, shape or form.
Look, this is about Governor Palin tonight. Everybody has seen the CBS Evening News. Everybody has seen Tina Fey on "Saturday Night Live" and they're kind of waiting to see from Governor Palin whether or not she has the mettle to be vice president.
It is all about her. She can try to take it to Senator Obama. She can try to take it somewhere else. But at the end of the day she has got to perform tonight and if she doesn't the McCain campaign is in even bigger trouble than it already is.
MATTHEWS: Ok. I predict she goes on offense. I hear, I believe she'll talk about taxes. She'll go after Joe Biden's record on tax issues, going back to when he went to the senate in '72. She'll pound him on the word taxes the first half hour. You watch.
Steve McMahon thank you. Todd Harris.
Up next, we will check in with our great crowd out here at Wash U. You're watching "HARDBALL" live from St. Louis for the vice presidential debate.
(COMMERCIAL BREAK)
MATTHEWS: You are all going to be watching tonight right here. I want to know this, what are you going to be listening for in tonight's debate between Sarah Palin and Joe Biden?
UNIDENTIFIED MALE: I'm looking for a sharp exchange between the two candidates. I'm really forward looking to Sarah Palin coming out and knocking one out of the park and reiterating those conservative ideals that matter to us.
UNIDENTIFIED FEMALE: I'm looking for Sarah Palin to stop avoiding the questions that she needs to answer. I want her to have something substantive to say. And for Biden to completely crush her because-
I'm looking for Biden to come off as the more experienced candidate that he is.
MATTHEWS: What are you looking for?
UNIDENTIFIED MALE: I'm looking to see whether John McCain, I think this is more about him than anyone else, whether his gamble to pick Sarah Palin is even going to break even. Whether his judgment is going to be confirmed tonight or whether the American people are going to decide that he has made an unwise decision as far as the nation's security has gone.
MATTHEWS: You have the makings of a brilliant pundit.
UNIDENTIFIED MALE: Thank you, Chris. I learned from the best.
MATTHEWS: What are you looking for tonight?
UNIDENTIFIED MALE: I just want to know that she knows what she is talking about and that she knows something about foreign policy and domestic policy. And that she has something more to say than what she said.
MATTHEWS: Are you going to watch fairly or do you have an attitude?
UNIDENTIFIED MALE: I love Obama. I don't like Sarah Palin at all.
MATTHEWS: Ok, thank you. I think that is clear.
What are you going to be looking for tonight?
UNIDENTIFIED MALE: I'm looking for Sarah Palin to articulate a significant breadth of experience and a significant depth on a particular issue which I don't actually believe she is able to do but I'm excited to see if she can do it.
MATTHEWS: John McCain, her running mate has said that she knows more about energy than anyone in the country. Do you think she'll be able to demonstrate that tonight?
UNIDENTIFIED MALE: I will see. I mean she seems to know a lot about oil drilling. But beyond that, I don't know how deep her experience really is on that issue.
MATTHEWS: so you are not one of these drill, drill, drill guys?
UNIDENTIFIED MALE: I'm not. No. I'm not. I'm certainly an environmentalist.
MATTHEWS: What was that?
UNIDENTIFIED MALE: I love you, mom.
MATTHEWS: Thank you.
Why don't you call home once in a while then? What are you looking for tonight?
UNIDENTIFIED MALE: It is all about economy. Everything's about the economy, I think, tonight. Happy birthday Angeli (ph).
MATTHEWS: What are you looking for.
UNIDENTIFIED FEMALE: I'm looking for an explanation of each candidate's environmental policy. I want to know what their plan is, how they are going to implement it, and over time, what those changes will be.
MATTHEWS: Have you made up your mind?
UNIDENTIFIED FEMALE: Yes, I have. I'm for Obama/Biden.
MATTHEWS: Ok, thank you.
Here we go. Another Biden, I better find a McCain. Catholics for Obama; now there's an interesting overlay. What does religion got to-my religion actually, in this case-have to do with the issue?
UNIDENTIFIED FEMALE: Well, I was actually talking to someone about this the other day. And under Democratic presidents abortion rates actually go down. For many Catholics that is the main issue. And with health care going for everyone, I think that will decrease abortion rates which is very important to me.
MATTHEWS: Well, that's a sound position. I think I will shake your hands on that one.
We'll be right back with more from the Wash U campus. Get that kid up there? That kid is gung-ho.
We'll be right back from Wash U with the vice presidential debate tonight.
(COMMERCIAL BREAK)
MATTHEWS: Welcome back to HARDBALL.
We're on the campus of Washington University, where the one and only vice presidential debate is 90 minutes off right now. So, what are the political-political stakes?
Congressman Debbie Wasserman Schultz is an Obama supporter.
Congresswoman, let me ask you tonight-you are a politician, and you're on this show a lot. So, let me ask you the same question I have asked everybody.
(LAUGHTER)
REP. DEBBIE WASSERMAN SCHULTZ (D), FLORIDA: Sure.
MATTHEWS: What is the test for Sarah Palin tonight? Is it brains? It is knowledge? Is it personality? Is it politics? Is it credibility? Is it ideology? Or is it simply composure in a difficult night?Try to pick one of these, brains, knowledge, personality...
WASSERMAN SCHULTZ: Sure.
MATTHEWS: ... politics, credibility, ideology, or composure. What is it about tonight?
WASSERMAN SCHULTZ: Well, I think it is about readiness.
I think that's-that that has been the consistent test for Sarah Palin and for any vice presidential candidate this entire election and any presidential election. She has to show tonight that she is ready to be one heartbeat away from the presidency-from the presidency.
And, thus far, she's not done such a great job of doing that. And the expectations are fairly low, so she has got a-a fairly low bar to clear tonight. But, you know, she has got to be prepared on the issues. She has got to show that she has the knowledge. And she has to show readiness that she is ready to go on day one if, God forbid, anything happens to the 72-year-old running mate of hers.
MATTHEWS: Is this about her brainpower?
WASSERMAN SCHULTZ: No.
I mean, you know, well, it is really not nice to suggest that there is something wrong with her brainpower. This is about some-whether or not she is ready to be president of the United States. That is the only responsibility of a vice presidential candidate, Chris. Are you ready? I mean, you are one-one heartbeat away from the presidency.
Ready means, does she have the knowledge? Does she have a grasp of the depth of the job? Does she have the-the information that she can draw from. All of those things are going to be incredibly important criteria to judge whether or not this is a person that should be one heartbeat away from the presidency.
And, thus far, Sarah Palin has not demonstrated that she has any of those things, not even very much of a command of the-of the facts or the issues that are necessary for someone who is going to be the vice president of the United States, potentially.
So, I think she has really got a tall order tonight. But she has demonstrated in previous debates that she rises to the challenge. And, like I said, the bar is kind of low. So, it-this is going to be a test of wills. And because of the format, she is going to have an opportunity to really kind of get in those short answers that she seems to be good at, and use a lot of quips and cute remarks that-that might endear her to an audience.
So, this is not going to be a cakewalk for Joe Biden, at all.
MATTHEWS: Well, do you think cute will beat brains?
WASSERMAN SCHULTZ: Well, I think that what happens to candidates like Sarah Palin, who are not ready for prime time, is that they sort of retreat into, you know, cute one-liners and-and comments. And she will probably talk a lot more personally, you know, and try to draw the audience in that way.
And, you know, it is going to be Joe Biden's responsibility to focus on the fact that John McCain is going to be the-the president of the United States if he wins this election, and that he is wrong on the issues that matter to America, confused about what to do with this economy.
At one point, he-two weeks ago, he said the fundamentals of the economy were strong. Sarah Palin is going to have to defend that record. And I-you know, she does not have an incredibly strong grasp of a broad range of issues, understandably so, because she has been the governor of a very small state.
So, like I said, she has got a tall order, a big-a big hurdle to jump. But there are debating skills that she has that she's going to be able to employee effectively, I'm sure. So, this is going to be a very interesting debate to watch.
MATTHEWS: Do you think she would do better on the questions on "Jeopardy" or the interview they do during halftime?
(BOOING)
WASSERMAN SCHULTZ: You know, I think she would probably do better on the-during the halftime interview.
And-but you know what? You can win a debate during the halftime interview, because you have an opportunity to show the personal side of you, as-as the candidate. And that, you know, often...
MATTHEWS: Right.
WASSERMAN SCHULTZ: ... appeals to an audience.
So, Joe Biden has a tremendous amount of experience. He is a skilled debater. But Sarah Palin has been through numerous debates. And this is a format that we expect her to be strong in.
MATTHEWS: OK.
WASSERMAN SCHULTZ: Joe Biden will ready. Sarah Palin, on the issues, probably will not be.
MATTHEWS: Congresswoman, Congresswoman, how much would you-how much would you like to be debating her tonight?
(LAUGHTER)
WASSERMAN SCHULTZ: You know, I-it's extremely tempting. It would be-it would be an exciting opportunity.
MATTHEWS: I think you're right.
WASSERMAN SCHULTZ: But Joe Biden is-is going to be ready, and I think he will do just fine.
(LAUGHTER)
WASSERMAN SCHULTZ: But I'm champing at the bit, I have to admit.
MATTHEWS: I think I got you blushing. I think I got you to blush, Congresswoman, because you know you would be dying to be in there.
(LAUGHTER)
MATTHEWS: Anyway, thank you, Congresswoman Debbie Wasserman Schultz...
WASSERMAN SCHULTZ: You're welcome.
MATTHEWS: ... Democrat of Florida.
WASSERMAN SCHULTZ: Good to see you.
MATTHEWS: Now to the campaign McCain senior policy adviser Douglas Holtz-Eakin.
So, what do you-what is about tonight, brains, knowledge, personality, politics, credibility, ideology, or composure?
DOUGLAS HOLTZ-EAKIN, SENIOR MCCAIN ECONOMIC ADVISER: It is about knowledge of the middle class. It's about connecting a real middle-class experience, which is hers, a working mother, Todd Palin, who has worked three jobs because had to make ends meet for the family, vs. the sort of artificial, arugula-style middle class that is being espoused by...
MATTHEWS: What is the arugula middle class?
HOLTZ-EAKIN: An arugula middle class is if you want around talking the talk, but you're going to raise taxes, have $800 billion in spending, and have a recipe for disaster for the middle class.
MATTHEWS: What is arugula? It's some kind of salad, isn't it?
HOLTZ-EAKIN: I think it's Barack's favorite food.
MATTHEWS: And why do you bring this up? You are saying that Joe Biden is an elitist? I don't think so. I mean, come on.
(CROSSTALK)
HOLTZ-EAKIN: We have seen...
MATTHEWS: Joe Biden is an elitist?
HOLTZ-EAKIN: We have seen them last week try very hard to claim the middle-class mantle. But the policies they have are bad for the middle class. Sarah Palin understands their issues. And we're going to go there.
MATTHEWS: What-I love the new slurs when they arrive. What is an arugula middle class?
HOLTZ-EAKIN: It's a not-very-real middle class. The real middle class is not eating arugula.
MATTHEWS: Is like the Brie and Chablis, the latest version of that elitism? Are you-is this the cultural issue you guys are going to raise tonight?
HOLTZ-EAKIN: No, this is...
MATTHEWS: That she is one of us, and that he is not?
HOLTZ-EAKIN: This is-this is about literally connecting with the pressing problems facing America.
MATTHEWS: OK. OK.
Do you think these informational questions that Katie Couric has been asking have been fair, like, what do you read? Give me a sense of your knowledge of the Supreme Court and its history? Are they fair questions?
HOLTZ-EAKIN: Every question is fair. You know, you don't run for...
MATTHEWS: Are those fair?
HOLTZ-EAKIN: Yes.
MATTHEWS: OK.
HOLTZ-EAKIN: These are fair.
(CROSSTALK)
MATTHEWS: Were the answers she gave good ones?
HOLTZ-EAKIN: She chose, out of two hours of interviews, some questions and answers that may not have been the best. We will get to see Sarah Palin live tonight. And she will knock them dead.
MATTHEWS: So, she edited out the good stuff, you're saying?
HOLTZ-EAKIN: We are very confident that, tonight, you will get to see her.
MATTHEWS: Are you saying that CBS deliberately edited out the good answers?
HOLTZ-EAKIN: We believe that there were-there were excellent answers throughout those two hours that could have been put on TV. We saw what we saw.
MATTHEWS: Let me ask you, do you think you guys will raise the tax issue tonight? I'm betting you will, heavy and early.
HOLTZ-EAKIN: Absolutely. This is a recipe for disaster. It's a bad idea.
Barack Obama himself has said, it is a bad idea. But they have an ideological commitment to doing things that are damage small business. I don't think most people know, in this economy, bad shape, small businesses have created 331,000 jobs this year. These is businesses with 50 or fewer employees.
MATTHEWS: Right.
HOLTZ-EAKIN: Why would you go after them? It makes no sense.
MATTHEWS: Well, what was the jobless rate when Republicans took office in 2004?
HOLTZ-EAKIN: The truth is, I don't remember.
MATTHEWS: It was 4.2 percent.
HOLTZ-EAKIN: I knew you would have it.
MATTHEWS: What is it going to be tomorrow?
HOLTZ-EAKIN: Right now, it's at 6.1. We're going to go north of that tomorrow.
MATTHEWS: So, in other words, unemployment has risen under the Republicans?
HOLTZ-EAKIN: We have seen unemployment go up recently. And we have got to change that.
MATTHEWS: It's risen in the last five years.
HOLTZ-EAKIN: No doubt about it.
MATTHEWS: Well, what is wrong with the old Ronald Reagan question, are you better off than you were four or eight years ago? What is wrong with that question?
HOLTZ-EAKIN: Because they are not running against George Bush. They're running against the guy who is-despite their best efforts to run against George Bush, they are running against someone who has tangled with George Bush on a regular basis. They're running with someone who desperate understands that we need to be free of our reliance on imported oil.
MATTHEWS: Right.
HOLTZ-EAKIN: A bit part of our trouble this year, rise in unemployment, comes from oil going to $140.
MATTHEWS: Has George Bush done a good job on the economy?
HOLTZ-EAKIN: George Bush has left us with the economy that you see.
Are you happy?
MATTHEWS: No.
(LAUGHTER)
MATTHEWS: Well, nobody is. But I'm just asking you.
I just think, have Republican policies been good for the country, economically?
HOLTZ-EAKIN: Oh, we know that-that spending was out of control hand over fist. That's a mistake.
MATTHEWS: So, Republican policies have failed the last eight years?
HOLTZ-EAKIN: Those parts of Republican policies have failed. There's no question.
MATTHEWS: Is that-it's hard to say, re-up us, give us another lease on life, if we have failed after eight years? That's a hard argument to make, isn't it?
HOLTZ-EAKIN: I think it is a very straightforward argument to make.
John McCain...
MATTHEWS: It is hard.
HOLTZ-EAKIN: Yes, but it's the real argument, because this is about the future. This is about having genuine leadership skills.
We know the records. Barack Obama has never crossed his party or his political backers to cast a tough vote. John McCain has. We know that there are hard issues in entitlements...
(CROSSTALK)
MATTHEWS: OK.
Jack Welch was on-Jack Welch was on "MORNING JOE" the other-yesterday morning, I heard him. And he predicted a fourth quarter from hell. In other words, the last quarter of this year, it's going to be deep negative growth, in other words, the beginnings of a deep, entrenched recession.
Is that a good result of eight years of Republican rule, to leave this country with a deep, deep recession?
HOLTZ-EAKIN: One of the things...
MATTHEWS: Is that a good thing to brag about?
HOLTZ-EAKIN: There's nothing good about a recession, and no one should brag about it.
But one of the reasons John McCain went-suspended his campaign, went back to Washington to try deal with this credit crunch is, we have real pain out in the economy right now. There are-there are dry cleaners, there are car dealers, there are people who rely on short-term loans to simply make their payrolls. It is not available.
And, if we don't deal with it and address it, we're going to have a fourth quarter that is from hell.
MATTHEWS: How does the fiscal policy of John McCain differ from that of George W. Bush, the fiscal policy?
HOLTZ-EAKIN: He will not spend money. He will not-he voted against the prescription drug bill. You can't blow up entitlements if you're not going to have them paid for.
He is not going to have discretionary spending be $180 billion higher than it would have been if we had just stuck to the Clinton-era budget balance agreement in 1997. That's a disaster.
MATTHEWS: So, George W. Bush was wrong on fiscal policy; John McCain is right?
HOLTZ-EAKIN: John McCain is right on fiscal policy...
(CROSSTALK)
MATTHEWS: And George W. Bush was wrong?
HOLTZ-EAKIN: He should have controlled spending.
MATTHEWS: OK. Thank you very much. You're an honest man.
(CROSSTALK)
HOLTZ-EAKIN: Thank you.
MATTHEWS: Douglas Holtz-Eakin.
Less than 90 minutes to go now before the big debate between Joe Biden and Sarah Palin.
(CHEERING AND APPLAUSE)
MATTHEWS: Up next: what to look for tonight.
This is HARDBALL, live in Saint Louis, only on MSNBC.
(CHEERING AND APPLAUSE)
(COMMERCIAL BREAK)
(CHEERING AND APPLAUSE)
MATTHEWS: We're back from Saint Louis, site of tonight's vice presidential debate. It's time for the "Politics Fix" with "The Politico"'s Mike Allen and "New York" magazine's John Heilemann.
Boy, we have got a lot of people out here who are going to vote.
Everybody here going to vote?
CROWD: Yes!
(CHEERING AND APPLAUSE)
MATTHEWS: OK. Good.
(CHEERING AND APPLAUSE)
MATTHEWS: Let me-let me ask you this.
And I know this is so uncool to ask this question. That's why I keep asking it. It seems to me, if you show all the responses to Katie Couric's questions, especially, some of them Charlie Gibson's, what has grabbed people is not the answers she gave, but where she seemed to not have an answer, that long pause and that difficult use of words without thoughts, where you just start-like we did on the test in school.
MIKE ALLEN, CHIEF POLITICAL CORRESPONDENT, POLITICO.COM: Right. Just fill up the blue book.
MATTHEWS: Is it, tonight, about brains? Is that what people are worried about, that the judgment of John McCain was to pick someone just for cultural reasons, geographic, gender reasons, but was it really a person who knew what they were talking about? Is that what it is about tonight, yes or no, Mike Allen?
ALLEN: I say no.
MATTHEWS: It's not about brains?
ALLEN: Because she is not...
MATTHEWS: Heilemann, is it about brains?
ALLEN: She is not going to win that argument. What she...
(CROSSTALK)
MATTHEWS: Well, what is it about, are people looking for? What are people looking for to see tonight?
ALLEN: Look, there is a sign back here says Tina Fey '08. And that is what Democrats hope this will be. But that's not who you're going to get.
MATTHEWS: OK.
ALLEN: What you're going to get is get someone who is going to come out and show that she can connect with real people. She's going to talk about how she's a working mom. And...
MATTHEWS: Well, we know she can do that. But we know that answer, Mike.
ALLEN: Chris, think about how you felt half-an-hour before her speech at the convention?
MATTHEWS: OK.
(CROSSTALK)
MATTHEWS: That was a scripted speech. It could have been written by Randy Scheunemann, for all we know.
(LAUGHTER)
MATTHEWS: Go ahead.
JOHN HEILEMANN, "NEW YORK": You have had this list of things all night.
I want to choose from the Chinese menu, right? Credibility is key.
MATTHEWS: That's on there.
HEILEMANN: Credibility, demonstrating that she can be commander in chief.
And I think brains is central to that.
MATTHEWS: Yes.
HEILEMANN: I think, that, at this moment, with the entire financial system melting down, one of the huge advantages that Obama has had is that it seems like he's smart...
MATTHEWS: Right.
HEILEMANN: ... that he has intellectual capacity. And I think she needs to demonstrate at least a minimal degree of intellectual coherence on stage, or she's going to come off having lost the debate.
MATTHEWS: You're on a plane. All right, this whole country is on an airplane right now. The pilot is out of action, OK? He is out of action right now. And you are yelling on a plane, does anybody know how to fly this fricking plane? And Sarah Palin come up and says, I'm not sure if I do. Let me try.
(CROSSTALK)
MATTHEWS: Now, is that the right-is that the answer?
(CROSSTALK)
MATTHEWS: Or do you go, who says they know how to fly this plane, and that person better know how to do it? Somebody has got to run our economy starting January 20, right?
ALLEN: Right.
MATTHEWS: Is she the one to do it?
(CROSSTALK)
MATTHEWS: Is John McCain the one to do it?
ALLEN: The point is, she needs people to trust her. She needs to remind Republicans why they originally were excited about her.
And she's going to come out and she's going to do that by, she's going to push back against Biden.
(CROSSTALK)
ALLEN: You're going to see very different styles. Senator Biden, he's never going to mention her. He wants to talk about McCain. He wants to talk about Obama.
MATTHEWS: You're giving me style, Mike. I'm amazed you're not talking substance here.
(LAUGHTER)
MATTHEWS: Does she got to show she's got the substance, got the chops to be vice president?
ALLEN: Well, of course she can't look ridiculous.
MATTHEWS: OK. That's what I'm asking.
Does she have to show she's got the chops.
HEILEMANN: I think she does.
I think she has to show that, when-she certainly can't drop the ball on anything. I mean, it will be disaster for her if there's an answer like the one she gave the other night about the Supreme Court decisions and when she couldn't come up with another answer. That will be catastrophic for her.
MATTHEWS: She had no familiarity with the role of the vice presidency in the Katie Couric interview tonight. She couldn't name one vice president and what they have done well as vice president.
She wasn't able to talk about any Supreme Court decision, not able to talk what newspaper she reads. What question is an easy question for her?
ALLEN: Well...
MATTHEWS: Tell me what the easy question is, and then they can ask it.
(CROSSTALK)
(LAUGHTER)
ALLEN: The newspaper was, she didn't want to-she just didn't want to show it.
(CROSSTALK)
MATTHEWS: What is she hiding?
ALLEN: You're going to see-what you're going to see is, she's going to asked very specific questions.
MATTHEWS: OK.
ALLEN: And you're going to see very general, 50,000-foot answers.
And, Chris, you're not her target audience.
MATTHEWS: I'm...
ALLEN: She's trying to reach people...
MATTHEWS: OK.
(CROSSTALK)
MATTHEWS: OK. Suppose Joe Biden was asked, "What newspapers do you read?" and he said, I would rather not answer that question.
(CROSSTALK)
ALLEN: He would at least say "The Wilmington News Journal."
HEILEMANN: She has not sounded good hovering around at 50,000 feet in a holding pattern. She did that on Katie Couric, and she sounded awful.
ALLEN: The point is, you're not going to win a contest with Joe Biden about world leaders.
(CROSSTALK)
HEILEMANN: But I don't think she has to win the contest. She just has to hit a certain minimum bar, right?
ALLEN: Right. I agree with that.
MATTHEWS: OK. I'm just trying to-let me get back to this.
What should a vice president of the United States know?
ALLEN: A vice president of the United...
MATTHEWS: What should a person who is up for the job-what is the minimal intellectual requirement? Give me a sense of it. Is it some sense of American history, some sense of the history of the job of vice president, some sense of the Constitution of the United States? Those are the questions Katie Couric put to her.
These are citizenship questions.
ALLEN: Right.
MATTHEWS: These are questions you ask somebody just applying to become a U.S. citizen.
ALLEN: Right. But, Chris...
MATTHEWS: Tell me what the-what the-what the courts do in this country. Tell me-you know, these are basics.
(LAUGHTER)
ALLEN: But, Chris, something I think that we all agree on is, those are questions for John McCain, who chose her. These are questions about how she was chosen and why.
HEILEMANN: But she could be president.
You know, if she-if he gets elected, she could be president any time in the next four years. I think the answer to your-the answer to your question is yes, yes, yes, and yes to all those questions you just asked.
I think she needs to know as much as the president knows. That's the fundamental test, right? Can this person be president if the president drops dead?
(CROSSTALK)
HEILEMANN: And, if she doesn't know those things, if she doesn't know those things, she's not qualified.
ALLEN: And that's been one of the premises of John McCain's candidacy until the moment she was chosen, was you need somebody ready.
(CROSSTALK)
MATTHEWS: I think John McCain, his judgment is on trial tonight. And she may well win it tonight with charm and smarts and political perspicacity, and know how to work around the questions.
But I still am stunned with her inability to answer these general knowledge questions that most people who read the paper can answer. I don't know why she is afraid to answer them. Maybe it's her bad training. My suspicion is that she has the same lack of intellectual curiosity that the president of the United States has right now. And that is scary.
(CROSSTALK)
HEILEMANN: Mike, do you think-do you think when she wouldn't-when she wouldn't answer what she-what she reads, do you think that was because she doesn't read, or do you think that is because she was afraid to say the local say the local Wasilla newspaper, or she was afraid to say "The New York Times"? Which of those do you think it was?
ALLEN: Somebody told me, she should have just said "The Economist."
Everybody lies about reading "The Economist."
MATTHEWS: No. Come on, Mike.
(LAUGHTER)
MATTHEWS: Every politician reads the local newspapers, don't they?
ALLEN: It's an easy answer. I agree with you completely.
MATTHEWS: That's how they know what to say.
ALLEN: I agree.
(CROSSTALK)
MATTHEWS: I mean, if you don't read the local paper...
(CROSSTALK)
MATTHEWS: I think it's an open question. I think she's been intimidated by the questions. But I think there's a real open question, based on the Couric interviews, more than anything else, about her knowledge base.
And I think it's going to be answered tonight. Let's give her a big chance tonight.
John Heilemann, who is tough, Mike Allen, who is soft as squish tonight.
We will be back with the crowd here at Wash U.-just over an hour to go before the vice presidential debate.
(CHEERING AND APPLAUSE)
MATTHEWS: You're watching HARDBALL, only on MSNBC.
(CHEERING AND APPLAUSE)
(COMMERCIAL BREAK)
(CHEERING AND APPLAUSE)
MATTHEWS: We're back at one of the most prestigious schools in America, Washington University...
(CHEERING AND APPLAUSE)
MATTHEWS: ... in Saint Louis.
(CHEERING AND APPLAUSE)
MATTHEWS: And we're about to have the vice presidential debate.
And I want to ask the students here, who are all hardworking. You have got to be smart to get in this school. And they all got in. I want to ask them what are they looking for tonight.
You're from Hyde Park, Illinois, home of Barack Obama.
UNIDENTIFIED MALE: Illinois!
UNIDENTIFIED FEMALE: I'm looking for Palin to mess up and really prove...
(BOOING)
UNIDENTIFIED FEMALE: ... that's she's not ready for this job, that she's...
(CROSSTALK)
UNIDENTIFIED FEMALE: ... for this job.
MATTHEWS: Well, that's honest. Well, that's honest.
What are you looking for?
UNIDENTIFIED FEMALE: I'm looking for her to finally give some answers. Can we finally figure out what is going on in her head maybe? Come on.
UNIDENTIFIED MALE: Come on? OK.
Your question tonight.
UNIDENTIFIED MALE: I'm looking for Joe Biden to show his experience and outperform Sarah Palin.
MATTHEWS: You think he will?
UNIDENTIFIED MALE: Absolutely.
(CHEERING AND APPLAUSE)
MATTHEWS: OK, I want to ask somebody also from Illinois, I believe President Lincoln. What do you you're going to be looking for tonight?
UNIDENTIFIED MALE: This won't quite be me vs. Stephen Douglas, but I think it's going to be a great debate. Sarah Palin just isn't qualified, and it shows McCain isn't a leader for choosing her as his vice president.
(CHEERING AND APPLAUSE)
MATTHEWS: All right. OK.
What are you looking for tonight to-to douse water on these people's hopes?
UNIDENTIFIED MALE: Well, I think what I'm looking for is, as many of you know, or if you have been watching TV lately, Biden does have a history of sticking his foot in his mouth. So, I can't wait for one of those times to show us tonight.
MATTHEWS: Thank you.
Anybody else?
What are you looking for tonight?
UNIDENTIFIED FEMALE: I'm looking for their views on education, and hope that they will show support for underprivileged communities, and hope that the children of our future will have more chances than they do currently.
MATTHEWS: Well said.
What are you looking for tonight?
UNIDENTIFIED FEMALE: I'm looking for Sarah Palin to really give us something substantial. You know what? I'm a woman, and I'm not fooled, not yet.
MATTHEWS: You're not one of those PUMAs?
UNIDENTIFIED FEMALE: No. No, sir.
(LAUGHTER)
MATTHEWS: You know what I'm talking about? You know what I'm talking about?
What are you looking for tonight?
UNIDENTIFIED FEMALE: Same thing.
MATTHEWS: Move over here.
(LAUGHTER)
MATTHEWS: What does that say? "I'm anti..."
UNIDENTIFIED FEMALE: Palin and anti-war. I'm insulted that John McCain thinks that, just because Sarah Palin is a woman, women will vote for her. And I want to hopefully show that her absence of any kind of substance will show that he made a bad decision.
MATTHEWS: OK.
Somebody else disagrees, right?
UNIDENTIFIED FEMALE: Yes. I'm looking for Joe Biden to falter tonight when they ask him how he's going to fund his socialist programs with...
MATTHEWS: Oh, socialist programs. I think we caught the theme there.
Anyway, we will be right back with more HARDBALL.
In fact, we're over.
"COUNTDOWN WITH KEITH OLBERMANN" right now.
(CHEERING AND APPLAUSE)
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
END
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