Guests: Peggy Noonan, Mike Paul, Jennifer Palmieri, Tom Defrank, Perry Bacon
CHRIS MATTHEWS, HOST: Is the dropping Dow dipping this campaign into a ditch?
Let's play HARDBALL. Good evening. I'm Chris Matthews. Leading off, the faltering economy and the politics of distraction. Wall Street showed again today that it is not at all impressed with last week's bail-out vote. The Dow dropped 369 points today, falling below 10,000 for the first time in four years. In the past two weeks, two things have plummeted, the stock market and John McCain's poll numbers, and that's no coincidence. So the McCain campaign has tried to change the subject from the economy to what he calls character, from what to who. Here's Sarah Palin today in Florida.
(BEGIN VIDEO CLIP)
GOV. SARAH PALIN (R-AK), VICE PRESIDENTIAL NOMINEE: I'm afraid this is someone who sees America as imperfect enough to work with a former domestic terrorist who had targeted his own country.
(END VIDEO CLIP)
MATTHEWS: The campaign, the Obama campaign, fired back with ads reminding voters of McCain's connections with the Keating 5 scandal. We'll look at the economy, the election and whether McCain can change the campaign dynamics by changing the subject.
Plus, today's the deadline for voter registration in many parts of the country. Democrats are making huge gains in registering new voters and that has helped make Obama competitive in traditionally Republican states. We'll look at the new electoral map and get a first peek at the NBC News/"Wall Street Journal" poll out tonight.And round two-Obama and McCain face off for their second debate tomorrow night in Nashville. We'll preview the debate and talk about what each candidate needs to do. And speaking of debates, "Saturday Night Live" nailed it again, this time with its version of last week's vice presidential debate. And this time, it wasn't just Sarah Palin who got pilloried.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE, "JOE BIDEN": I love John McCain. He's one of my dearest friends. But at the same time, he's also dangerously unbalanced.
(LAUGHTER)
UNIDENTIFIED MALE: I mean, let's be frank. John McCain-and again, this is a man I would take a bullet for-is bad at his job and mentally unstable.
(LAUGHTER)
(END VIDEO CLIP)
MATTHEWS: Much more of that in the HARDBALL "Sideshow" tonight. And in the "Politics Fix" tonight, John McCain's effort to change the subject from the economy to character. Will it work? And remember, HARDBALL will be on campus at Belmont University in Nashville tomorrow night for the presidential debate. Three HARDBALLS tomorrow night, 5:00, 7:00 and midnight Eastern time. MSNBC will have full coverage of the debate moderated by Tom Brokaw beginning at 9:00 o'clock Eastern. Then at 10:30, David Gregory joins me for post-debate coverage and analysis. "COUNTDOWN" with Keith Olbermann will be live at 11:00. And then, as I said, we'll have a late night edition, the third edition of the night, of HARDBALL. I love those late night editions with all the kids around, raising trouble. It's fun.
But first, the Dow falls below 10,000 for the fist time in four years. Jim Cramer is the host of "MAD MONEY" on CNBC. We don't have to call it "MAD MONEY" just today, but that's what's coming. Cramer, what do we do?
JIM CRAMER, HOST, CNBC'S "MAD MONEY": OK...
MATTHEWS: I wonder what do we do?
CRAMER: If you need money, if you've got some sort of short-term consideration, need to buy a house, need to buy a car, you're about to put your kid through college, take some of the money out of the stock market, please, and put it in a cash account, meaning a savings account that's now insured to $250,000. If you don't need the money, you don't have any short-term demands, you can let it ride, provided they're in safe stocks. That means good yield. It means safe balance sheet. And it means they're conservative-you can smoke it, you can eat it, you can drink it. That's fine with me.
MATTHEWS: OK. So it's like owning a good house. If you know your house is solid, it's got a good structure, it's going to last another 100 years, stay there.
CRAMER: Yes!
MATTHEWS: And that's the same with the stock market, right? If it's worth...
CRAMER: That's a great analogy!
MATTHEWS: ... what it's worth...
CRAMER: That's a great...
MATTHEWS: If it's worth what it's worth, eventually, it'll get that price.
CRAMER: Totally. But I also don't want people to say, as they did in 2000, It'll come back. Don't worry about it. You know, if someone's about to retire in two years, look, take some of that money out right now. Don't wait to see if it comes back.
MATTHEWS: Well, that's the old argument. You'll run out of time before you run out of money. Look, I-that's a good argument, by the way, for getting the money now. But let me ask you this about the big picture. Is this going to go on for the next couple weeks through the election?
CRAMER: Yes.
MATTHEWS: Is this going to be as bad news-will we be talking about the stock market on the first Tuesday after the first Monday in November?
CRAMER: Absolutely. There's just-the worldwide problems are too great. This big decline today, where we had down 800, this isn't even us anymore, Chris. I mean, the largest developer in Europe fell apart over the weekend. Germany is making it so that everybody who has a savings account is insured. These are things that caused France to be down 9 percent. I mean, France is buying houses in the open market. Europe has gotten it now. They're down 8 to 10 percent. We were actually spared a very big decline.
MATTHEWS: Well, I don't care, really, about that. I want to know if that means something to us. Is that going to bounce back over here?
CRAMER: Yes. That's what I'm saying. I'm saying that we need some strong market somewhere. China's disappeared off the face of the earth. Russia, they keep closing the market all day. But the thing we need to know, Chris, is we're having trouble getting our financing for our own companies.
MATTHEWS: OK. Thank you very much, Jim Cramer. Bad news, but we'll get back to you and see if it's going to continue beyond the election.
CRAMER: OK.
MATTHEWS: We've already hear it's going to continue through the election. Anyway, "MAD MONEY" airs weeknights at 6:00 and 7:00 Eastern on CNBC. Joining me now, "Wall Street Journal" columnist, and the best in the business this year, Peggy Noonan, who's new book is appropriately called "Patriotic Grace." And "The Washington Post" columnist and MSNBC political analyst Eugene Robinson. We talked about the economy. What are the politics of the economy right now? What is this doing, the fact that the market dropped about 400 points today and it keeps dropping every day? What's that do to this election?
PEGGY NOONAN, "WALL STREET JOURNAL" COLUMNIST: Oh, my goodness. It tells the American people we are in a real economic crisis. It leaves everybody feeling anxious. When people are anxious, they get angry. Who are they going to be angry at? They're going to be angry at the president's party. I mean, there is a rough justice on economic matters. If the economy is going well and Bill Clinton is the president, whether he had something to do with it or not, he gets the credit.
MATTHEWS: Yes, my dad always told me-he was a Republican. He always told me, Hey, it wasn't Hoover's fault. He had some good ideas.
(LAUGHTER)
MATTHEWS: He was working on those ideas...
(CROSSTALK)
MATTHEWS: It is judged on whose watch it is.
EUGENE ROBINSON, "WASHINGTON POST," MSNBC POLITICAL ANALYST: It does. It-you know, and so that's working against John McCain and in favor of Barack Obama. The other thing, frankly, that's working against McCain and in favor of Obama is how the two initially reacted to the fiscal crisis. And I think...
MATTHEWS: You mean the one that said the economy's fundamentally strong?
ROBINSON: Exactly. The one who said the economy-the fundamentals of the economy are strong, and then had an erratic path through the week to finally get to the point where, This is a crisis I have to suspend my campaign for...
MATTHEWS: OK, let's talk about...
(CROSSTALK)
ROBINSON: ... and the other one who was very steady, you know, perhaps didn't, you know, shoot the lights out on the crisis, but nonetheless, was steady and inspired confidence.
MATTHEWS: Let's talk about that word "steady." Back in the old days, we were all much younger and we wanted a daddy figure as our anchorman at night. Remember the daddy figure (INAUDIBLE) great Uncle Walter, or uncle? Back in those days, when we were a little more younger in our mentality, we wanted a daddy that would say, We'll get through the assassination, we'll get through the war, we'll get through Watergate. And Uncle Walter came on tonight and said, That's the way it is.One thing I noticed about Obama-and it sometimes drives me crazy, Peggy...
NOONAN: Yes?
MATTHEWS: ... is that he seems very calm. And I keep wanting him to be more like me and more like Cramer.
(LAUGHTER)
MATTHEWS: We're very much alike! And yet that almost Zen calmness of him-in our-Perry Como calmness of his...
NOONAN: Yes.
MATTHEWS: ... seems to be helping him, compared to the erratic-seeming McCain.
NOONAN: Yes.
MATTHEWS: Is that tenor important, or is it-at some point, do you have to show some passion?
NOONAN: I think Barack Obama made a big impression on the American people in the past 10 days. There was a crisis, and he was-the word I always think of for him is "languid." He was languid...
MATTHEWS: Is that good?
NOONAN: ... really cool. He was calm. He was laid-back. You know what's funny about him? He never gets a little tremor, never gets a shake. It's always straight ahead.
MATTHEWS: The voice of the...
(CROSSTALK)
ROBINSON: They call him "No drama Obama" and...
MATTHEWS: Well, here he is. Let's watch and see if we can measure any tenor (SIC) in his voice today, as this stock market just shakes, rattles and rolls downward. Here he is in Nashville.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL NOMINEE: I've got news for the McCain campaign. The American people are losing right now. They're losing their jobs. They're losing their health care. They're losing their homes. They're losing their savings. I cannot imagine anything more important to talk about than the economic crisis, and the notion that we would want to brush that aside and engage in the usual political shenanigans and smear tactics that have come to characterize too many political campaigns, I think, is not what the American people are looking for.
(END VIDEO CLIP)
MATTHEWS: OK. Now, hold that picture, everybody watching that picture, that guy there, with what's coming now. Here's Governor Palin talking about that man today in Florida.
(BEGIN VIDEO CLIP)
PALIN: I'm afraid this is someone who sees America as imperfect enough to work with a former domestic terrorist who had targeted his own country. This, ladies and gentlemen, has nothing to do with the kind of change that anyone can believe in-not my kids, not for your kids. What we believe in is what Ronald Reagan believed in, and that is America is an exceptional nation!
(CHEERS AND APPLAUSE)
MATTHEWS: In this same vein, here's the sheriff of Lee County in Florida. Speaking at a program before a Palin rally, he had this to say about the Democratic nominee for president.
(BEGIN VIDEO CLIP)
SHERIFF MIKE SCOTT, LEE COUNTY, FLORIDA: On November 4th, let's leave Barack Hussein Obama wondering what happened!
(CHEERS)
(END VIDEO CLIP)
MATTHEWS: OK. I'm a student of politics since I was 13 years old, and I see a pattern, all right? This has nothing to do with my views about these candidates. I see an attempt over the last several days to tie three points together in the thinking, of older voters especially, so that they can have a mystery about Barack Obama they haven't had last week. One, this question of his relationship with Bill Ayers, the Weatherman, back 10 years or so in Chicago politics, or Chicago organizing politics. Two, his middle name Hussein. And three, the question of who his donor list includes. I think they're putting this together by demanding that donor list. They're trying to build the case that he's a man of mystery, not that he's a street corner guy from the ghetto, but that he's somehow maybe connected to terrorism because of this past association with a terrorist, with his middle name being Hussein, which I predicted last week everybody-everybody I talked to-it was coming out, and third, this donor list game. They are trying to make him a man of dangerous mystery because they can't beat him on the standard issues of this election. Is that what they're doing?
ROBINSON: Absolutely. I mean, it's-it's...
MATTHEWS: Connect the dots.
ROBINSON: And they don't have to connect-but they're not connecting the dots. They just-they just...
MATTHEWS: Well, you're watching it.
ROBINSON: They just pop a dot up here and another dot out there, and they let people draw whatever...
MATTHEWS: Use their imaginations.
ROBINSON: They'll never say...
MATTHEWS: They want us to do the dirty work for them.
ROBINSON: They'll-exactly.
MATTHEWS: That's what's so brilliant.
ROBINSON: They'll-and-and...
MATTHEWS: They want the voter...
ROBINSON: ... so are we going to do it? Are we going to...
MATTHEWS: They want the voter to do it. That-I'll tell you, John McCain tomorrow night with Tom Brokaw will not attack him for his association. He will talk about him. He will say, Can he take a hit? Can he take questioning? Very smart. At the same time, Governor Palin is out there hitting him in the guts.
NOONAN: Yes.
MATTHEWS: And at the same time, they've got this sheriff out there in the sheriff's uniform talking about Hussein, and meanwhile, the DNC is being-they're going after their donor list, trying to find an Arab name on one of the checks. That's what the-it's all over the papers today. This is what they're after.Your thoughts, Peggy, because I don't know who you're going to vote for, by the way.
NOONAN: Oh!
MATTHEWS: I'm absolutely convinced I don't know who you're going to vote for. I can't tell.
NOONAN: I'm thinking it through. It has been a long and winding year!
(LAUGHTER)
(CROSSTALK)
NOONAN: ... a long and winding road.
MATTHEWS: ... the best reason to get "The Wall Street Journal" on Saturday morning is Peggy.
ROBINSON: It is.
MATTHEWS: Isn't it?
ROBINSON: It is. Absolutely.
NOONAN: This is...
MATTHEWS: And you're talking to one of the great columnists of our time.
(CROSSTALK)
NOONAN: Yes, I know that.
ROBINSON: And she's my favorite columnist, so...
NOONAN: Guys, that-what you just showed, Palin and the other fellow, that's the base talking to the base. That's fine. It's a little bit like Bob Dole in 1976 going out and talking about "Democrat wars." Do you remember that?
MATTHEWS: Right.
NOONAN: They sent Bob Dole out as the pitbull. That didn't...
MATTHEWS: In '76.
NOONAN: Didn't I say '76?
MATTHEWS: Yes. It's so long ago.
NOONAN: I know...
(CROSSTALK)
NOONAN: Nobody will know if we're wrong on that one.
MATTHEWS: You know what it's like...
(CROSSTALK)
MATTHEWS: ... people talking about Coolidge when we first got into politics!
ROBINSON: Exactly.
NOONAN: Yes, I know!
MATTHEWS: What are they talking about?
(CROSSTALK)
MATTHEWS: They're talking about Coolidge, I think.
(CROSSTALK)
NOONAN: But here's the thing. It's not that it's irrelevant, it's that it's not big enough for the moment. And the American people, I feel...
MATTHEWS: They want big.
NOONAN: ... know this.
ROBINSON: They want big.
NOONAN: They want big.
MATTHEWS: OK.
NOONAN: They're in an economic crisis...
MATTHEWS: OK.
NOONAN: ... that they think may grow into a great depression. These guys...
MATTHEWS: But you're the person who goes...
(CROSSTALK)
MATTHEWS: Let me ask you this. When we were studying in Catholic school-did you go to Catholic school, Gene?
ROBINSON: I did not.
MATTHEWS: OK, Catholic school, they teach you in scholastic philosophy, the difference between an essential aspect of a situation and an accidental aspect. Is this important to the whole question of who you marry, what business deals do you cut or whatever, what you do in life, your moral decisions, or is it accidental, right? The flavor of the ice cream is not that important. It's the essential thing you do.
Is this question of whether he went to some meetings back in the '90s, where there were some other people there from Chicago organizing business and one of the guys there is a guy who teaches at school there and had this terrible history behind him-is that essential to this question, or is it not? Is it accidental or essential? Because I think that's the key here. Should we be talking about Bill Ayers tomorrow night in Nashville?
NOONAN: This is what I think when I hear it on the radio as I drive here. It feels old to me. Failed congressional oversight feels new and pertinent to me. You know? What happened with...
MATTHEWS: Boy, that's pertinent.
NOONAN: Yes!
MATTHEWS: The Congress has not been watching these agencies.
NOONAN: Yes. But both parties, they have dirty hands. Both parties.
ROBINSON: They do?
NOONAN: They both have a lot to talk about. They have a lot to explain.
MATTHEWS: Peggy (INAUDIBLE)
NOONAN: We're taking the...
(LAUGHTER)
NOONAN: (INAUDIBLE) they've got a lot to explain. It's both parties. You know what the American people aren't going to quite believe anybody is going to...
MATTHEWS: Look at the numbers...
NOONAN: ... help us out of this...
MATTHEWS: ... on Congress, by the way.
NOONAN: ... economic mess...
MATTHEWS: Look at the numbers on...
(CROSSTALK)
NOONAN: ... unless somebody's honest about...
(CROSSTALK)
ROBINSON: ... Congress, look at 370 down on the Dow today...
MATTHEWS: Yes, I always wonder...
ROBINSON: ... and people look at their...
MATTHEWS: ... who's been minding the store...
ROBINSON: ... the numbers on their 401(k)s and...
NOONAN: Yes, that's it, the 401(k) money...
MATTHEWS: Imagine writing a history book...
NOONAN: ... is what I'm hearing, everybody...
MATTHEWS: The election turned on who the guy hung around with 20-some years ago. I tell you, I always try to look forward, then look backwards. What were the causes of the war? What turned the election? What were the big issues that turned the election? And then look back and say, That's a basis for judging, a big historic reason. You only get one vote.
NOONAN: But with only 30 days out, what does it say that this is the topic? It says something...
MATTHEWS: Well, it ain't big...
NOONAN: ... weird. It says...
MATTHEWS: ... but it's a great book.
NOONAN: ... that we're avoiding-it's almost as if history...
(CROSSTALK)
NOONAN: ... will look back and say, Look at the point we were at and...
ROBINSON: We shouldn't let them do that, though.
NOONAN: ... and this is what they were...
NOONAN: We in the media shouldn't let them do that.
MATTHEWS: I'm holding up...
(CROSSTALK)
MATTHEWS: ... Peggy Noonan...
ROBINSON: We should make them talk about...
MATTHEWS: ... "Patriotic Grace." I want to thank you, Peggy Noonan.
Thank you, Gene Robinson. You're a great writer, one of the best. I've been watching and studying politics, as I said, for a long time. What we're seeing here is a campaign that knows it's on a losing course, that knows it needs desperately to change the subject. I'm talking about the McCain campaign. The subject right now is the economy, and it's killing the incumbent party. If you ask someone if they like the direction this country's heading in, only a fraction, a slice of the voters say, yes, keep it up. So what do the wise guys around John McCain tell him? They tell him that he either goes at his rival personally or he loses. He needs to change the subject from, What do you think of the way things are headed in this country, to, Who is this guy Barack Obama? Mystery. That's what they want to shroud Obama with, mystery. The guy's been out there in the open now for four years. We've been watching his every he move, grabbing his every sound bite, watching everything he does in public, everything we've look at in his public record. But that's not the point. What the geniuses around John McCain want voters to do right now is to worry about something they can't determine, could never determine from the facts. They want to create a mystery that the imaginative voter can connect like a string of dots from, oh, paling around with terrorists to his middle name to his donor list that might just include some foreigners. They're out to say that Barack Obama is friendly to the people now threatening our country. That's the dirt. And using this technique of creating a mystery in our minds, they want the voters to throw that dirt. Coming up, new numbers from our NBC poll. We're going to show you that tonight. Plus, first-time voters are registering in record numbers in many battleground states, and a majority of them are coming out for the Democrats. Where does Barack Obama stand to gain the biggest advantage from new voters? We'll tell you. NBC's Chuck Todd joins us with a look at all of that next. You're watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
MATTHEWS: Welcome back to HARDBALL. To win this election, Barack Obama is like a bride-to-be. He needs something old, something new, something borrowed, something blue. Well, look at these new registration figures in today's "Washington Post." Something old-in Florida, newly registered Democrats outnumber newly registered Republicans 2 to 1. Something new-in Colorado, it's a 4 to 1 advantage for Democrats. Something borrowed-in North Carolina, it's nearly a 6 to 1 advantage for Democrats. And something blue-in Pennsylvania, that's a blue state, nearly a half million new Democrats on the rolls, while Republicans-catch this, this is the only state this has happened-Republicans have lost 38,000 registered voters in the state of Pennsylvania. What does it all mean?
NBC political director Chuck Todd joins us from Nashville, the site of tomorrow night's debate. And Jennifer Donahue is with us from the New Hampshire Institute of Politics. Both of you, thanks for joining us, Chuck and Jennifer. =One of the-first, Chuck, this question of the numbers, it seems to me that there's two arguments made in this campaign. One is, first African-American candidate, a lot of dispute about what that means among older white voters, and, yet, all these new voters we keep hearing about. How do you measure one against the other, the more conservative feelings among older voters and this flash of new registrants?
CHUCK TODD, NBC NEWS POLITICAL DIRECTOR: Well, we can only measure what we have seen. And what did we see? Think back to Ohio, Chris, and how Barack Obama actually remade the electorate. He was on a trajectory that said he couldn't win older white voters, the whole conversation that we're having now a little bit. And what did he do? He changed the electorate. He turned out 100,000 more Democrats than anybody thought could be turned out. The estimates had-the highest had been 125,000. He turned it into 240,000, and he wins by 10 points. I think that's what we're seeing. This is part one of this strategy that the Obama campaign had always promised in the back rooms with Democrats in D.C., which is, you know, yes, there might be some trouble in the northern tier. There might be some trouble with older white voters in Pennsylvania, in Michigan, but here's how Obama overcomes it. He puts new states in play. Virginia, North Carolina, they will see an African-American turnout and a youth turnout that nobody's ever seen before. Well, so far, part one has happened. And that is the voter registration numbers. He may have changed the electorate, changed what it looked like in Virginia. It isn't what it looked like four years ago. It's going to look different. And, if that's the case, that's the difference between winning and losing if he sees a 20 percent new voter spike.
MATTHEWS: Jennifer, do the same thing. Put that up against each other, the resistance of older voters and the explosion of new, younger voters.
JENNIFER DONAHUE, SENIOR ADVISER FOR POLITICAL AFFAIRS, NEW HAMPSHIRE
INSTITUTE OF POLITICS AT SAINT ANSELM COLLEGE: Well, it's clear that-that Chuck is absolutely right, that a lot of tossups and even Republican states are seeing serious increase among Democratic voters. Young voters are lining up in droves to register.
I have seen that at voter registrations at Harvard at Saint Anselm. There's no doubt about that. What we do not know yet, though, compared to the Iowa analogy is how Republicans and independents will vote on Obama. And that does leave a question mark in the middle of the whole equation, which is that, will people actually go and vote? It is different to register than to actually do the act of voting. So, while the numbers are very, very intense and persuasive, we don't know if that will mean that there will be this mass voting for Obama.
MATTHEWS: Yes. We will have some numbers, by the way, coming out of the new NBC poll out tonight on our second edition at 7:00, courtesy of Chuck. We will have some new numbers about-very interesting numbers about independents and how they're moving right now. It wouldn't surprise you. By the way, Chuck's team has a new electoral map out today. All the changes are for Obama, no change for McCain. Here's what it looked like for Obama week ago. And here's what it looks like now. So, you want to give us a narration of that a bit, Chuck, what's changed?
TODD: Well, what's changed is we have seen the-as the economy and this double stomach punch for McCain, right, which was basically losing the debate to Obama, through public perception-other people scored it how they want to score it-the public made a decision that Obama and Biden won the first two debates. Combine that with the economic downturn, the right track just cratering, wrong track going way up again, economic issues to the forefront, And we're seeing all these Kerry '04 states. There is not a single Kerry '04 state where Obama trails. More importantly, there's not a single Kerry '04 state where Obama's lead is anything less than five points. I mean, really, only Pennsylvania, of those Kerry blue states, seems remotely competitive right now. Anything can happen in 29 days, but, right now, only Pennsylvania seems remotely competitive.
MATTHEWS: Well, run through that. I originally heard that the Republican plan was, they knew they couldn't get Iowa, but they were hoping to pick up from the old map of 2004 New Hampshire, Michigan, and Pennsylvania, in that order.
Jennifer, is that still reasonable? Looking at it from your end, New Hampshire, is that three points, electoral votes, still available to them? They have given up on Michigan. Are they aiming now at Pennsylvania and New Hampshire, and holding fort in Ohio?
DONAHUE: Well, that's a really good question. I mean, we had a poll done by Saint Anselm that showed Obama up by 12 just a few days ago. And we're seeing extreme volatility, including Democrats, who were just elected two years ago now having to fight for their seats. If you have a chair in Washington, you're in huge trouble. That's the bottom line. But these debates are really not shedding a lot of light on the issues. I walk around New Hampshire, and I hear voters saying, you know, I'm so sick of hearing about these two guys' baggage. I want to know what it means to me financially.
MATTHEWS: Yes.
DONAHUE: I think John McCain has one chance of turning this thing around. He should have voted against the bill, probably, and said, we haven't had one minute of hearings in committee on the biggest government bailout of the economy that we have ever had. We haven't had one minute of hearings.
MATTHEWS: Yes.
DONAHUE: He should say that. He also needs to stay on the Republican message of tax cuts. That's how Bush did this in 2000. All he talked about was tax cuts. I went to a Sununu-Shaheen debate at Saint Anselm today, and I'll tell you what. Most of what John Sununu talked about was tax cuts. That is a message Republicans could still win on, although their odds are really, really uphill right now.
MATTHEWS: Well, this just in guys: Fifty percent of voters say Obama and Biden did better in the two debates. That's NBC/"Wall Street Journal" poll out tonight. Twenty-say percent say McCain/Palin. Chuck, your thoughts on why it's so lopsided? Why is it 50/29? You only have about 10 seconds here.
TODD: I just think that voters are grading McCain and Palin on a curve. They're having-making them have to do more somersaults to prove that they're going to be change, that they're going to change things.
MATTHEWS: OK.
TODD: Obama and Biden are getting the benefit of the doubt.
MATTHEWS: OK. Thank you very much, Chuck. Thank you, Jennifer, for joining us-Jennifer Donahue.
DONAHUE: Pleasure.
MATTHEWS: "Saturday Night Live"'s Tina Fey has been doing a number on Sarah Palin. And, this weekend, "SNL" struck with this interesting impression of Joe Biden.
(BEGIN VIDEO CLIP, "SATURDAY NIGHT LIVE")
UNIDENTIFIED ACTOR: I love John McCain.
(LAUGHTER)
UNIDENTIFIED ACTOR: He's one of my dearest friends. But, at the same time, he's also dangerously unbalanced.
(LAUGHTER)
UNIDENTIFIED ACTOR: I mean, let's be frank. John McCain-and, again, this is a man I would take a bullet for...
(LAUGHTER)
UNIDENTIFIED ACTOR: ... is bad at his job and mentally unstable.
(LAUGHTER)
(END VIDEO CLIP)
MATTHEWS: That's so Joe Biden. More of that ahead on the HARDBALL "Sideshow."You're watching it, HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
MATTHEWS: Back with HARDBALL.
Time for the "Sideshow."
"Saturday Night Live" is the one big winner this election. They have had a lot of fun at Governor Palin's expense. Hey, I sometimes think, watching Governor Palin, when I'm watching her, that I'm actually watching her play Governor Palin.
Anyway, but, this time, "SNL" went after Joe Biden.
(BEGIN VIDEO CLIP, "SATURDAY NIGHT LIVE")
UNIDENTIFIED ACTOR: I love John McCain.
(LAUGHTER)
UNIDENTIFIED ACTOR: He's one of my dearest friends. But, at the same time, he's also dangerously unbalanced.
(LAUGHTER)
UNIDENTIFIED ACTOR: I mean, let's be frank. John McCain-and, again, this is a man I would take a bullet for...
(LAUGHTER)
UNIDENTIFIED ACTOR: ... is bad at his job and mentally unstable.
(LAUGHTER)
(APPLAUSE)
UNIDENTIFIED ACTOR: As my mother would say, God love him, but he's a raging maniac...
(LAUGHTER)
(APPLAUSE)
UNIDENTIFIED ACTOR: ... and a dear, dear friend.
(LAUGHTER)
UNIDENTIFIED ACTRESS: Governor Palin, would you like to respond to Senator Biden's comments about John McCain?
TINA FEY, ACTRESS: No, thank you. But I would like to talk about being an outsider.
(LAUGHTER)
FEY: You see, while Senator Biden has been in Washington all these years, I have been with regular people, hockey moms and Joe Six-Packs.
(LAUGHTER)
FEY: And I would also like to give a shout-out to the third-graders of Gladys Wood Elementary...
(LAUGHTER)
FEY: ... who were so helpful to me in my debate prep.
(LAUGHTER)
(END VIDEO CLIP)
MATTHEWS: I can't tell them apart.
The winner of last week's V.P. debate, I say Tina Fey. Anyway, things got argumentative today on "The View." Let's check it out.
(BEGIN VIDEO CLIP, "THE VIEW")
WHOOPI GOLDBERG, CO-HOST: Barack Obama is not the terrorist. Let's make sure that we're clear that Barack Obama is not the terrorist.
(APPLAUSE)
GOLDBERG: So, linking him to people and linking-we can link all of these guys to people. That's-I'm done.
ELISABETH HASSELBECK, CO-HOST: Barack Obama went to the house of William Ayers...
GOLDBERG: Yeah.
HASSELBECK: ... who is a U.S. terrorist...
GOLDBERG: In...
BARBARA WALTERS, CO-HOST: Doesn't it bother you, with everything that's going wrong with this country, that either side is going back to smearing?
HASSELBECK: This is what bothers me truly about Barack Obama, because when I heard him back, I really thought there was hope for him. It bothers me that he's not open. Whether you agree with Sarah Palin or not, she's open...
SHERRI SHEPHERD, CO-HOST: Why do you say he's not open? He did address...
(CROSSTALK)
HASSELBECK: He wants to hide. He wants to hide all of his radical connections.
(CROSSTALK)
GOLDBERG: You know what? That's such...
(END VIDEO CLIP)
MATTHEWS: We haven't seen, by the way, North Korean leader Kim Jong Il lately, but, this weekend, the North Korean official government news agency said he was at a soccer game. According to our own Associated Press, that state news agency source wouldn't say where or when that soccer game actually took place. But they did put out a bit of what the official North Korean news agency said were the dear leader's casual comment in watching that soccer game. I love this line-quote-this is what a guy supposedly said at a soccer game while watching the game-quote-"The revolutionary and militant students in our country are good at art and sporting activities, while devoting all their wisdom and enthusiasm to the study of science for the country and the people"-close quote-again, a casual comment from the dear leader. If you ever doubt, ladies and gentlemen, the value of a free press, remember these words: This is the way an unfree press kisses the royal behind of a dear leader. Now it's time for tonight's "Big Number." The ongoing trooper-gate investigation is looking into whether Governor Palin abused her powers by firing a commissioner who refused to fire her brother-in-law. That's the governor's brother-in-law. A number of aides to Governor Palin had said they would not testify in the probe, but not anymore.According to the AP, seven aides to Governor Palin have reversed themselves and will testify in the trooper-gate case in Alaska. And, by the way, the report-or the verdict on that case is going to come out this coming Friday. We will all be watching. That's tonight's "Big Number"-seven, seven aides to Governor Palin who have now said they are going to testify in the trooper-gate case up in Alaska. Up next: Will we see an aggressive John McCain in tomorrow night's debate with Barack Obama? There's only two debates left. And as McCain's poll numbers slip, his chances to get back in the race are dwindling. We will preview tomorrow night's debate-next.
You're watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
JULIA BOORSTIN, CNBC CORRESPONDENT: I'm Julia Boorstin with your CNBC "Market Wrap."
Stocks recovering late in the date from a record plunge, though still suffering heavy losses. The Dow Jones industrials finished the day down 369 points, the Dow had been down a record 800 points. It closed below 10000 for the fist time in nearly four years. The S&P 500 lost 42 points, and the Nasdaq dropped 84. Stocks tumbling because of a continuing global credit crunch. Over the weekend, two major European banks had to be rescued. The late-day rally was triggered in part by talk of a coordinated interest rate cut by central banks around the world. Meantime, oil prices continue to plunge. Crude fell $6.07, closing at $87.81 a barrel. And, after the closing bell, Bank of America reported third-quarter profits plunged 68 percent. It also announced it's cutting its dividend in half, and that it is planning a $10 billion stock sale to raise capital. That's it from CNBC, first in business worldwide-back to HARDBALL.
MATTHEWS: Welcome back to HARDBALL. Barack Obama and John McCain will square off again in their second presidential debate tomorrow night in Nashville, Tennessee. Are Sarah Palin's attacks on Obama's ties to William Ayers a preview of what we will see tomorrow night from McCain? A top McCain strategist told "The New York Daily News" that-quote - the campaign plans to ramp up its attacks-"It's a dangerous road, but we have no choice. If we keep talking about the economic crisis, we're going to lose." That's from a campaign aide to McCain. Mike Paul is a Republican consultant who has advised to Giuliani. And Jennifer Palmieri is with the Center For American Progress. Let me start with you, Mike. Do you think it's fair ball to ignore the major issue of our times and go back after a personal association and make it like the biggest thing in the world, like Governor Palin is doing right now and her campaign? She's saying it's the biggest thing in the world. We should focus on that more importantly than anything else. That should be the campaign, right there?
MIKE PAUL, PUBLIC RELATIONS CONSULTANT: Well, I think that...
MATTHEWS: Bill Ayers, former Weatherman, currently a professor of a college out in Chicago, who has had some sort of relationship with Barack Obama going back to the '90s.
PAUL: Radical who also was involved with trying to blow up the Pentagon and also the U.S. Capitol.
MATTHEWS: Right. Right. That's right.
(CROSSTALK)
MATTHEWS: Well, he was a Weatherman back in the '70s -- '60s and '70s.
PAUL: That's terrific. But that's not what we're focused on either. Look, I think that all issues are on the table. I don't think that you should be holding back any issues.
MATTHEWS: What's the central issue of this election? What should people be thinking about? You only get one vote, Mike. What should you be thinking about?
PAUL: Well, you get one vote, but you can certainly be thinking about more than one issue when you cast that one vote. And I think that's certainly fair for the American people to have that choice. Is the central issue of the week, is the central issue of the month, is the central issue that's going to-as you just heard from Jim Cramer, going to go beyond even Election Day, going to be the economy? I think the answer to that is absolutely yes. But I think it is the job of both staffs of this campaign to say, but that's not what it's all about. It's one of the central issues, but we certainly should be talking about character. We certainly should be talking about a moral compass. And we certainly should be looking for judgment. Because what we want in these situations is the right judgment at the right time.
MATTHEWS: I just wonder whether it's like in a criminal case where the smart defense attorneys will shift it to some crazy thing, get the voters thinking-the jurors in this case-the voters thinking about something off the scope and focus on it. There's a great case called "The Anatomy of Murder," a movie-Jimmy Stewart plays the defense attorney, says, don't think about a blue cow. Of course, all the jurors think about a blue cow. I that's what this is about. Create a mystery out there, get a focus out there, and think about that, because you can't get it out of your mind. What do you think?
PALMIERI: I think you laid it out earlier in this show three things that they appear to be doing, one invoking Ayers and Wright, two, culling through the donors to try to find foreign donors, and three is evoking his middle name, Hussein. It seems to me, as someone who's worked on a campaign, as a strategy that's probably been lying around there for a long time, and they weren't ready to employ it until they felt they absolutely have to. But I think that it's probably too late. I think that the American people decided certainly after the first debate and then also after watching how Obama handled the crisis-What was the big hurdle for him? The big hurdle has been, is he ready to lead? Can we really see him as a president? He's past that bar. He's met that bar. If you're going to try to make him seem like a French to terrorists, you're going to have to start that months ago.
PAUL: Jennifer, if you're going to bring that up, then we have to bring up the other side. This week, certainly, one thing that Obama's campaign is bringing up is the Keating situation, and they're also trying to say that a senator who, ironically we just heard in a spoof that VP running mate is saying he's a good guy and an honorable man-they're saying he's unhinged. Obama was just saying that just a couple of days ago. Let's be fair. Let's talk about both sides.
MATTHEWS: What was Obama saying a couple of days ago? What was that?
PAUL: He said this is a man that is unhinged, in other words, a man -
-
MATTHEWS: He said-
PAUL: -- grasping at anything-
MATTHEWS: He said that John McCain is unhinged. He said that? Where did he say that? When did Barack say that? Unhinged? Where did he say that, Mike?
PAUL: That's what he said.
MATTHEWS: We're going to check that out. I find that fascinating. I hope one of my producers will go looking for that, unhinged. Let's get back to what we can prove one way or another. You're arguing that the Barack Obama campaign is wrong in bringing back the Keating 5 issue as counter-fire? Is that what you're saying? Because they did it as counter fire to this Bill Ayers thing.
PAUL: I'm saying that this is a campaign. I'm saying that every political campaign that I've ever worked on, whether it's at the local level, the national level or the presidential level overall, has had some issues that deal with character, has had, quite frankly, some issues that are uncomfortable for people to sometimes listen to, have had some issues that are not as important as the issue of the day on that day, but are still important issues for the overall campaign.
PALMIERI: Here's what I think about the Keating 5. I think that it is-
MATTHEWS: Explain the Keating 5.
PALMIERI: Keating 5, Senator McCain 22 years ago was involved in a scandal, mostly campaign finance-
PAUL: And exonerated.
PALMIERI: Well, he was censured.
PAUL: Exonerated.
PALMIERI: That's not what's relevant.
PAUL: It's relevant. It absolutely is relevant. You know, you guys are something else, you know. When you have something from a Democratic perspective, you're more than happy to blow it out of the water. But when there's another story from the other side-
(CROSS TALK)
PALMIERI: What's relevant about Keating 5 at this point is that if the American people needed more evidence that John McCain was on the side of the deregulators and on the side of the banks for a long time, Keating 5 gives it to you. The problem with Keating 5 now isn't that he took money from Charles Keating. That's not the-
MATTHEWS: He was a land developer.
PALMIERI: What's relevant is he supported the policies that led to deregulation of S&L. That's why the Obama campaign brought it up. I don't know that they actually need more evidence that he's tied to these-
MATTHEWS: Mike, do you think it's fair ball-I don't think you believe you think anything is ball-do you think it is fair ball to try to sell some connection between-today we saw it-Barack Obama's consorting-I think that's Bill Kristol's word-with this guys Bill Ayers, back in Chicago. They're both on the Democratic side, or left side of things, if you will. And his middle name, Hussein, and the Democratic donor list right now; you don't see them trying to put all that together to make the case that this guy is a mystery man, perhaps dangerous to the country? You don't think that's what they're up to.It's not about hanging around with Bill Ayers. It's about suggesting there's a dangerous aspect to this guy, right?
PAUL: It also has to do with judgment. If you say you haven't had a relationship with the guy for the past three or four years, guess what, it is certainly OK for the research staff to go back and find out that he talked to him as early as 18 months ago. To the effect of him not-
MATTHEWS: What is the point?
PAUL: For him to be involved with a radical group that at one time in this country was trying to blow up federal buildings in this country, which is certainly a sensitive issue. If you're going to say the economy is a sensitive issue, you can darn sure say blowing up buildings in this country is a sensitive issue. I live here in New York City.
MATTHEWS: It's more than 35 years ago the guy was involved. That was back in the late '60.
PAUL: And how long ago was the Keating 5, Chris? Let's be fair.
MATTHEWS: I reported on it. It was within the last 20 years at least. A lot more recent than the other one. That's why-just remember, Keating 5 was brought up as counter fire to this bringing up of Bill Ayers.
PAUL: It doesn't matter.
MATTHEWS: It does matter.
PAUL: Why does it matter?
MATTHEWS: Because they're trying to shut down this effort to distract the campaign. They're making the other campaign pay for its distraction, is what they're doing. You know what's going on. Mike, you know what's going on. I'm arguing with a pro here. You know exactly what's going on.
PAUL: And both sides need to be heard. I'm not saying you shouldn't discuss it. I'm saying both sides need to be heard. You called me the prop man before. I brought the gloves back. There's going to be a debate tomorrow. The gloves will be out on both sides. Guess what, there won't be any love lost either. We're going to make sure we have love.
MATTHEWS: You've got all the props. Let me tell you, the issue is does anything go?
PAUL: I do think that anything goes.
MATTHEWS: I've got to go. Mike Paul, thank you, sir. Please come back. Jennifer Palmieri, please come back.
Up next, the McCain campaign has taken the economy off the front burner by targeting Obama's character. But now McCain and Palin run the risk that those types of attacks will backfire. We'll get to that next in the politics fix. This is HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
MATTHEWS: Welcome back to HARDBALL. Now the politics fix. Tonight's round table, the "Washington Post's" Perry Bacon, and Tom Defrank of the "New York Daily News." Tom, thanks for joining us. By the way, we've been able to locate a comment from the Obama campaign itself that referred to John McCain as erratic. We haven't found that unhinged reference that we heard a moment ago. It may not be true. We will keep looking. Back in April, John McCain had this reaction when the North Carolina Republican party ran an ad calling Obama quote, too extreme, close quote, because of his association with the Reverend Wright. Here is the comment by John McCain back then: "I'm making it very clear, as I have a couple of times in the past, there's no place for that kind of campaigning and the American people don't want it." Tom Defrank, what's changed in John McCain's mind and soul?
TOM DEFRANK, "NEW YORK DAILY NEWS": What's changed, Chris, is the economy is killing his candidacy. That's as simple as I can make it. Obama has expanded his lead in direct inverse proportion to the tanking of the stock market over the last two or three weeks. And the McCain camp is desperate to get the national conversation off the economy, which is a bread and butter issue, a pocketbook issue that always traditionally helps Democrats. So they are trying to change the subject, change the conversation.
MATTHEWS: Well, Perry, it's hard to do that when the economy just suffers another fall like today, with the Dow Jones dropped. You know, ti dropped frighteningly today, down about 700 points below, and bounced back to about 300 plus points below. It's hard to distract from that, isn't it?
PERRY BACON, "THE WASHINGTON BACON": I think you're right. The headlines tomorrow will probably be more-McCain gave this very fiery speech toady about criticizing Obama. I suspect the headlines in tomorrow's papers will be more about the Dow going down than something about the McCain speech. The Obama advisers, when I talk to them, they think the economy will remain an issue no matter how many character attacks each side goes at each other. The economy will remain the dominant issue for the next few weeks in the election.
MATTHEWS: What's the Obama campaign plan to react? Is it simply to throw out the Charles Keating scandal, which is kind of amorphous from many years ago? Is that their only plan to match tit for tat?
BACON: I think if you look at what they have said the last couple of days, they talked about McCain being erratic. They talked about him being out of touch. They are making their own character-It's not that McCain is making character attacks and Obama is not. Both sides at this point are making character attacks. Character attacks are a part of every election cycle, to a great degree.
MATTHEWS: It seems to me, Tom Defrank, that if you look at the pattern of attack by the McCain forces-as you say, they have to change the subject-first of all, it was kind of odd things like Obama is no good; he's a celebrity. Then it was Barack is no good, lipstick on a pig is a bad phrase to use. Now, it's Barack is no good because he hung out in the Chicago politics, Democratic politics, with a guy named Bill Ayers back then. It seems like there is a pattern of erratic effort to try to change the subject no matter what it might be to.
DEFRANK: I don't know if that is a prima faci evidence of erratic behavior by the McCain camp. But I think it suggests that they don't have an overall strategy. It's basically tactical responses to the problem of day. And the problem of day today and for the last two or three weeks has been the economy.
MATTHEWS: Lee Atwater once said he never thought he would get as far as he did with just tactics. That was in 1988 when times were better. We'll be back with Perry Bacon and Tom Defrank for more of the politics fix. You're watching it, HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
MATTHEWS: We are back with Perry Bacon and Tom Defrank for more on the politics fix. Let's try to get some reporting out of you. First with you, Tom: in tomorrow morning's "New York Daily News" what will you report about the debate tomorrow night? Can you tell us now?
DEFRANK: Well, I don't want to say too much, Chris, but we are doing a debate preview. We're going to say that McCain is going to up the ante by going negative, and he's going to try to figure out a way to go negative in a way that is not too negative, but that raises doubts about Obama and gets-what he really has to do is to try to connect with the ordinary guy and get back some of the mojo he used to have.
MATTHEWS: Perry, it looked to me like today they were having McCain go out and make a statement which didn't make a direct reference to this guy Bill Ayers back in the '90s, or whatever, back what he did in the '60s, but they did have him make a comment that would fit into an evening news or a nightly news TV package. In other words, gave you guys some quote to use in the paper and on television, without actually him nailing the guy. Is that what they are going to use? Just use McCain on the periphery of this story, and let Governor Palin do the dirty work?
BACON: It looks like that, based on the weekend where Palin referenced Reverend Wright. She mentioned William Ayers, while McCain's speech was more about Senator Obama and what you don't know about him. Although to talk a little bit about the debate tomorrow, actually, tomorrow's debate has-they're in a town hall format. It's hard to imagine voters at a town hall are going to ask about Charles Keating or Bill Ayers. It will be hard for either one of the candidates to reroute how will you fix my health care into one of these personal attacks they're both doing. I suspect tomorrow may be different. They may preview attacks that won't actually come out tomorrow.
MATTHEWS: Tom, do you think they might get a ringer in there tomorrow, somebody on the side to raise these issues, one about Bill Ayers? I think it's hard for me to believe they are not going to bring that name up somehow, that McCain won't find, through whatever direction, to get that into the discussion, since it seems to be their main bean bag this week.
DEFRANK: As we learned at the vice presidential debate, there's always a way for skillful debaters to change the subject and not answer the question. Answer the question they want to answer, even if it is not the question that just got asked. I think you are right. I think they will both finds targets of opportunity there.
MATTHEWS: I think Governor Palin proved the extents to which you can go without answering a question. And you can say anything you damn well please in these debates, which is probably the way it has always been. Thank you very much, Perry Bacon. Thank you, Tom Defrank. Tomorrow, we are in Nashville for the second presidential debate between Barack Obama and John McCain, moderated by our own Tom Brokaw. Join us for HARDBALL at 5:00 and 7:00 tomorrow night, then again at midnight. Right now, it's time for "RACE FOR THE WHITE HOUSE" with David Gregory.
Copy: Content and programming copyright 2008 MSNBC. ALL RIGHTS RESERVED. Transcription Copyright 2008 ASC LLC (www.ascllc.net ) ALL RIGHTS RESERVED. No license is granted to the user of this material other than for research. User may not reproduce or redistribute the material except for user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon MSNBC and ASC LLC's copyright or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.
Watch Hardball each weeknight