updated 10/28/2008 12:37:48 PM ET 2008-10-28T16:37:48

Guests: Jonathan Alter, Chris Hayes, Chris Kofinis

KEITH OLBERMANN, HOST (voice over): Which of these stories will you be talking about tomorrow? The closing argument: Obama in Ohio. It's not just Bush past, it's McCain future.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA, (D-IL) PRESIDENTIAL CANDIDATE: The question in this election is not, "Are you better off than you were four years ago?" We all know the answer to that. The real question is, "Will this country be better off four years from now?"

(END VIDEO CLIP)

OLBERMANN: Can McCain possibly be better off eight days from now?

Even by appealing to selfishness and fear?

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R-AZ) PRESIDENTIAL CANDIDATE: Now, this election comes down to how you want your hard-earned money spent. Do you want to keep it invested in your future, or have it taken by the most liberal person to ever run for the presidency?

(END VIDEO CLIP)

OLBERMANN: Full (ph) moose: GOP ticket infighting in the rise of a Palin insurgency with enabler, Elisabeth Hasselbeck. The governor's new clothes still the talking point because the governor continues to point at them.

(BEGIN VIDEO CLIP)

GOV. SARAH PALIN, ® VICE PRESIDENTIAL CANDIDATE: I'm back to wearing my old clothes in my favorite consignment. And my wedding ring is in Todd's pocket because it hurts sometimes when I shake hands and it gets squished-a $35 wedding ring from Hawaii that I bought myself.

(END VIDEO CLIP)

OLBERMANN: The startled McCain senior advisor, who says, those "were not the remarks we sent to her plane." Palin versus McCain and the theory of the rogue diva. Funds debate: The top right-wing thinker who says the White House is lost. The campaign funds ought to go to the GOP senators and congressmen, and the pitch should be: make sure the Democrats don't control all three. Worsts: Joe "Wile E. Coyote" Lieberman suddenly realized there's no more mesa (ph) under him, just dust, telling reporters, "When I go out, I say, 'I have a lot of respect for Senator Obama. He's bright. He's eloquent.'" Membrane: Conflict of interest in Orlando.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE ANCHOR: How is Senator Obama not being a Marxist if he intends to spread the wealth around?

SEN. JOE BIDEN, (D) VICE PRESIDENTIAL CANDIDATE: Are you joking? Is this a joke?

UNIDENTIFIED FEMALE ANCHOR: No.

(END VIDEO CLI)

OLBERMANN: Actually, yes, it is a joke. The newscaster's husband is a Republican strategist. And tonight: a Campaign Comment. The GOP volunteer told police a black man mugged her, and then carved a "B" for Barack into her face. A plea to Senator John McCain, denounce the ugliness and win something in the last week, even if it is only respect.

All that and more: Now on COUNTDOWN.

(on camera): Good evening, from Philadelphia. This is Monday, October 27th, eight days until the 2008 presidential election.

The Democrat in the race for president is facing only one challenger still tonight. The Republican, it would seem, is taking on three at a time. Our fifth story on the COUNTDOWN: One final week remaining of McCain versus Obama, McCain versus Palin, McCain versus Bush. Good luck with that one, sir. No wonder, the Arizona senator appears to be waging enough hill fight. We begin tonight with Obama and McCain. The Illinois Democrat giving a rousing speech that his advisors call his "closing argument," making an emotional case for electing himself over Senator McCain, and returning to a campaign that has seen absent during the economic downturn-hope. Five different polls released in the last 48 hours giving Senator Obama the lead in-Virginia. Obama by 11 in polling by the Virginia Commonwealth University. Public Policy Polling, a nine-point lead. Survey USA also nine points. "The Washington Post," eight. Even Zogby at seven. With that as the backdrop, Senator McCain is still trying to gain some traction on the economy beginning with the meeting with some economic advisors and an attempt to portray his opponent, actually, the Democratic leadership as a whole, as dangerous on taxes.

(BEGIN VIDEO CLIP)

MCCAIN: Now, this election comes down to how you want your hard earned money spent. Do you want to keep it invested in your future or have it taken by the most liberal person to ever run for the presidency and the Democratic leaders, the most liberal, running Congress for the past two years-Nancy Pelosi and Harry Reid?

(CROWD BOOING)

MCCAIN: You know, my friends, this is a dangerous threesome.

(END VIDEO CLIP)

OLBERMANN: Democrats dangerous, check. Distance self from unpopular president, check, check.

(BEGIN VIDEO CLIP)

MCCAIN: This is the fundamental difference between Senator Obama and me, a fundamental difference. We both disagree with President Bush on economic policy. The difference is that he thinks taxes have been too low. And I think-and I think, that spending has been too high.

(END VIDEO CLIP)

OLBERMANN: A claim that might have more credibility, one, were it not for Senator McCain's voting record, and two, had Senator McCain not said on "Meet the Press," just yesterday, of himself and Mr. Bush, quote, "Do we share a common philosophy of the Republican Party? Of course." And that closing argument speech, Senator Obama arguing that it might really help if Senator McCain could define what he's actually for.

(BEGIN VIDEO CLIP)

OBAMA: After 21 months and three debates, Senator McCain still has not been able to tell the American people a single major thing he'd do differently from George Bush, when it comes to the economy. Not one thing.

(APPLAUSE AND CHEERS)

OBAMA: Senator McCain says we can't spend the next four years waiting for our luck to change. But you understand that the biggest gamble we can take is to embrace the same old Bush-McCain policy that has failed us for the last eight years. We can't afford to take that risk.

(END VIDEO CLIP)

OLBERMANN: And about those supposedly dangerous tax cuts.

(BEGIN VIDEO CLIP)

OBAMA: No matter what John McCain may claim, here are the facts. If you make under $250,000 a year, you will not see your taxes increase by a single dime, not your income taxes, not your payroll taxes, not your capital gains taxes-no taxes, because the last thing we should do in this economy is raise taxes on the middle class. And we have been saying that throughout this campaign.

(END VIDEO CLIP)

OLBERMANN: As for the whole part of the Obama campaign's final stretch, it turns out this election may not hang on to the question of whether you are better off than you were four years ago after all.

(BEGIN VIDEO CLIP)

OBAMA: The question in this election is not, "Are you better off than you were four years ago?" We all know the answer to that. The real question is, "Will this country be better off four years from now?"

(END VIDEO CLIP)

OLBERMANN: Time now to call in our own Richard Wolffe, also, of course, senior White House correspondent for "Newsweek" magazine, who's traveling with the Obama campaign at the other end of this state, joining us tonight from Pittsburgh. Richard, good evening.

RICHARD WOLFFE, MSNBC POLITICAL ANALYST: Good evening, Keith.

OLBERMANN: During the primary, Senator Obama accused of not being able to close the deal. Is this approach to-and phrasing of it as the closing argument speech, is that part of a strategy to address this previous idea that he couldn't close the deal?

WOLFFE: Well, up to a point. I think there are two different sets of phases to the primaries as we think back to that period. This is the Obama of the Iowa period. And he had a closing speech, by the way, before the caucuses there. The candidate's fired up, the crowds are enthusiastic, and he's summarizing some of the big things which turned out, as it happens, to be very similar about McCain as they were for Hillary Clinton, this argument about changing and fixing the broken politics. But the campaign points out that in the later phase, when we think about the arguments that he couldn't close the deal, we're talking Pennsylvania or Ohio or Texas, states where the demographics are against him, where he didn't have much time to get himself known and he was running on an economic message against Hillary Clinton who had a very good lock-hold on that economic message. With McCain, it's a very different situation. So, it's not really the campaign points out about Obama, it's just a very different situation and the close here feels different right now in Pennsylvania and Ohio, earlier this morning, than it did in the primary phase.

OLBERMANN: Now, why Ohio for the rollout for that speech? Was it because that he struggled with working class voters in that state in particular during the primaries? Is it because no Democrats won the White House since Kennedy without Ohio in 1960? Or is it just some symbolism relating to how Kerry lost in 2004 basically in Ohio?

WOLFFE: I don't think anything is symbolic at this stage. This is very focused and targeted. Ohio is an offensive state in the sense that this is a Bush state, of course. It's still very close. You know, most people in the state think you still could go either way.

And then coming to Pennsylvania, at the end of the day, giving the same kind of speech, obviously, the single defensive move that he has in the sense that this is the state, McCain, for some reason, in spite of the public polling, still thinks he has a shot in. But really, most of this period, these last eight days, is going to be on Bush territory. And that's, I think, the relevance of Ohio.

OLBERMANN: And turning to Virginia, those five polls out of that state, all giving Senator Obama substantial leads of some measure. What-do we, at some point, get over the fact that we are actually talking here about the state of Virginia going for a Democrat in a presidential election?

WOLFFE: Well, you're right to point out. This is an astonishing set of events. When the Obama campaign started this general election, instead, listen, we're going to be focused on Virginia here. There was a lot of people in the press and in political class that said, this is really kind of wishful thinking. And at this stage to have that kind of lead, it is a clear sign. They are looking at multiple paths to getting enough votes in the Electoral College. Really, inside campaign headquarters, in Chicago, the Obama folks think that Virginia is the one to watch on election night. If they really winning by these kinds of margins, then, there are going to be lots of Bush states that will fall for Obama. But, you know, again, cautiousness-is that lead really going to hold? They think there's going to be a lot of tightening.

OLBERMANN: The candidate and television is the final topic, Richard. Do we know anything yet about that half hour Wednesday where he's buying every channel but Sci-fi. I mean, he's going to be on half an hour on, I mean, basically, all the broadcast networks, and possibly, many of the cable networks as well. Is this a documentary more than a speech? Is it more like Michelle Obama's performance tonight on the "Tonight Show"? Or what we do expecting out of this?

WOLFFE: Well, they are keeping it under tight wraps here, but this is going to be a professional production. They are working very intensively on it. They've got a number of teams working on it in terms of their advertising guys. And the people who are working on it are known for being meticulous about the execution. So, I think, they are trying to make good TV, but the content, we still going to wait and see.

OLBERMANN: Richard Wolffe of "Newsweek" and MSNBC, in Pittsburgh for us tonight. Thank you, Richard.

WOLFFE: Thank you, Keith.

OLBERMANN: And as for the McCain campaign, quoting here, "Any serious Republican has to ask, how did we get into this mess. It's not where we should be. And it's not where we had to be. This was not bad luck." That from former House Speaker Newt Gingrich.

To look at the other side of this equation, let's bring "Newsweek" columnist, MSNBC political analyst, Jonathan Alter.

Good evening, Jon.

JONATHAN ALTER, NEWSWEEK: Hi, Keith.

OLBERMANN: For Senator McCain, this closing argument idea that Obama has raised here, McCain's argument is one of Nazi's, not Bush. They shouldn't elect-the voters should not elect the three Democratically-controlled parts of this government, and also, they should not elect a tax happy liberal. Is that it? Is that the closing argument? Here's what you don't do?

ALTER: Apparently, it is, you know. And this argument has failed. It hasn't worked. It's not as if John McCain hasn't been trying the argument for a while, Keith. And you can tell from Newt Gingrich's quote that there are a lot of Republicans who wish he would focus more on the future. People like Gingrich, whatever you think of what he did in government, he's always talking about things like nano-technology or he just wrote an article with John Kerry about more evidence-based medicine and the need for that. Other issues than just the old liberal bashing that has played out, the old attacks on tax and spend liberals just don't work. So, in that sense, John McCain is not just an older candidate, his ideas and his whole approach are smelling very old tonight.

OLBERMANN: Is the geography here, the physical logistics, the story at this point that both candidates are campaigning almost exclusively in states that George Bush won four years ago? I mean, when McCain literally is defending turf, does that make any kind of cohesive final message even more difficult to craft, let alone sell?

ALTER: Well, remember, you know, except for being in Pennsylvania, which he hopes to pick off from the Democrats, they won it the last time, and also New Hampshire, which went for John Kerry and there are some indications that McCain has a connection there because he won two big primaries up in New Hampshire. Other than that, the McCain strategy is to win the Bush states. And so, it's not surprising that he would try to go to the base and try to reproduce, after all, you know, these many months, reproduce the 2004 victory. The problem is that the Karl Rove play book, even Karl Rove doesn't think that it's applicable to this year's election. So, the only way for McCain to win at this point, and there's still has a chance, is for one of two things to happen. Either if there will be some huge external event, and even that might not necessarily play to his benefit, although he's the default candidate, you could argue that that conceivably help him, or to just play to fear of Obama, fear of the other, fear of electing a president whose middle name is Hussein. All the things we know are out there in parts of the electorate. If they weren't, if Barack Obama was your usual vanilla candidate, this thing would be totally over.

OLBERMANN: Fear and Pennsylvania. I'm in Philadelphia. I'm not going to be here that long. I didn't get the pulse of the city or anything during my time here, but I've heard a few things here. Why-why Pennsylvania when Philadelphia could deliver, conceivably, a seven-digit-the Philadelphia area could conceivably deliver a seven-digit margin for Obama? Does McCain actually have a chance in this state?

ALTER: Well, I think what they are playing on is the James Carville theory of Pennsylvania-that it's got Philadelphia on one side, Pittsburgh on the other, and there's Alabama in the middle. And John McCain is going to win Alabama. They also noticed that, even though he had several weeks, Obama did badly there in the primary. Even Philadelphia, African-Americans didn't turn out in overwhelming numbers for him. He didn't do particularly well in Montgomery County and Bucks County and those areas around Philadelphia. So, the easiest way for McCain to win this thing would be to change everything around in Pennsylvania. But, he's in a deep hole there and he's still digging.

OLBERMANN: Jonathan Alter of "Newsweek" and MSNBC-as always, thanks, Jon.

ALTER: Thanks, Keith.

OLBERMANN: With one week to go, there is something John McCain can do to change the story of this election. My Campaign Comment to him tonight on the alarming silence from his candidacy in the hoax perpetrated by one of his volunteers and pushed by one of his campaign's spokesman. With problems like that when it is no wonder Governor Palin is rebelling against the very McCain handlers charged with keeping her in check. Shouldn't you expect rogue behavior from a self-described maverick?

(COMMERCIAL BREAK)

OLBERMANN: The would-be empress' new clothes. That story of all things is pitting Governor Palin against her own campaign advisors. The RNC's other money problem is putting millions of dollars on the McCain story as the momentum stays in Obama's favor, just throwing away the money.

And in Membrane: The anchor who compared Obama to Karl Marx, Joe Biden asked who helped to write those questions, wait until you hear the possible answer-ahead here on COUNTDOWN.

(COMMERCIAL BREAK)

OLBERMANN: A key question from McCain-Palin campaign today: Does Governor Palin really believe John McCain would be a good commander-in-chief? And if so, why is she already disobeying his commands? Our fourth story tonight: Based on multiple reports from multiple sources, Sarah Palin is a rogue GOP elephant. The first trickle of reports of last week of tension, of disloyalty, turned into a flood over the weekend.

Saturday: Politico.com quoting four sources close to Palin saying she has decided to reject McCain's strategy and, quote, "go rogue," specifically ignoring mandates from Team McCain, from chief McCain strategist, Steve Schmidt, and fellow Bush veteran Nicolle Wallace, one of the lead McCain people on Palin's team. Twenty-four hours after that report, Governor Palin did little to dispute it. Less than one minute into a rally in Florida, Palin not only defied the campaign mandate, not to mention that whole $150,000 in clothing money for the Palin family, she also revealed whose advice she was now following instead.

(BEGIN VIDEO CLIP)

PALIN: This whole thing with the wardrobe, you know, I tried to just ignore it because it's so ridiculous. But I'm glad now that Elisabeth brought it up because it gives me an opportunity without the filter of the media to get to tell you, the whole clothes thing. You'd think, not that I would even have to address the issue because, as Elisabeth is suggesting, the double standard here, gosh, we don't even want to waste our time. I'm glad, though, that she brought up accessories, also. Well, enough about clothes and hairdos, and high heels, though I would say, when I heard Elisabeth speaking, she is one to take the gloves off when the heels are on. That's Elisabeth.

(END VIDEO CLIP)

OLBERMANN: Who is this Elisabeth whose counsel has eclipsed that of McCain's most trusted advisors? She's Elisabeth Hasselbeck, who became co-host of "The View" after finishing fourth on "Survivor: The Australian Outback." CNN today quoting an unnamed McCain advisor, saying that Palin's Hasselbeck-ian comments, quote, "were not the remarks we sent to her plane." Quoting another-and I can't stress this enough-McCain advisor, quote, "She," Palin, quote, "is a diva. She takes no advice from anyone." Hasselbeck. "She is playing for her own future and sees herself as the next leader of the party. Remember, divas trust only unto themselves."

Let's turn now to Chris Hayes, Washington editor for "The Nation" magazine, and specialist in political divas. Thanks for your time, Chris.

CHRIS HAYES, "THE NATION" MAGAZINE: Thank you, Keith.

OLBERMANN: To whatever extent it's true that the Obama camp is acting as if there's already a win in the bag, is not the message of infighting from the McCain camp, that the McCain campaign, particularly Governor Palin, they're acting as if they have already got a loss in the bag?

HAYES: Yes, absolutely. I mean, what we're seeing is a breakdown of discipline. That's really quite staggering actually. I mean, you always got to be a little careful about stories that are naming on, you know, that come with blind quotes and unnamed sources. But a lot of the reporting that was done over the weekend is done by people I really trust. And at this point, it's pretty clear that there is an all out civil war between the two principal members of the ticket and their staffs. And already, it seems like the main, political fight that's happening internally in the campaign is people's political fight to save their jobs and to save their reputations, most importantly, and their livelihoods, once this campaign is over.

OLBERMANN: The Politico report included this observation that Palin would like to go even, quote, "more rogue." And again, we're saying rogue, and not Rove-although the two things might be similar. But given the result so far, what else could she do between now and next Tuesday to help the Democrats more than going more rogue right now?

HAYES: Well, I have honestly no idea, although, I will say that going more rogue is definitely my favorite phrase thus for of the entire campaign season. I mean, what she did today was, actually, I thought, pretty shocking in terms of the rally clip that you played earlier. You know, at this point, I can't imagine. Look, her negative approval ratings and her unfavorables are so high that I think she's probably bottomed out in certain sense. I think the people that are going to like her, like her. The people who are going to like her, aren't going to like her. And I can't imagine that her going more rogue or, you know, diva-ing it up down the stretch is going to make a huge difference one way or the other.

OLBERMANN: Except for this. I mean, the McCain aides, who are then returning fire here, are taking shots off the record and maybe, by the end of the week, they'll be on the record at Palin. Are they not, essentially, the shots-are they not also boomerangs and that any critique of her reflects still on McCain because, after all, McCain chose her, it's not like she wasn't already there when he got the nomination?

HAYES: Absolutely. It's tremendous selfish and stupid to give these blind quotes that they're giving. I mean, it's really remarkable.

Look-you know, there's a week left in the campaign and you're exactly right. I mean, John McCain-and let's remember as we know from the Draper story in "New York Times" magazine over the weekend, and his staff, were behind the Palin picks. So, they cannot, you know, there is no one to blame but themselves when this is all sort of computed in the final analysis.

OLBERMANN: The "American Spectator" reported today that the anti-Palin stuff is, in fact, coming those who transferred out of the Mitt Romney campaign into the McCain overall GOP effort, you know, hoping to knock her down so that Romney would have a comparatively clear path, I supposed, or is an easier path in 2012. But if that is true, does it not also suggest, (A), that McCain's staff, again, already is assuming this election is over and McCain is done, and (B), that a violation of the Reagan 11th commandment, "Thou shalt not speak ill of the fellow Republican," by itself just suggests that what's ahead for the Republican Party, unless there's a victory next Tuesday, is a serious and long term fracture?

HAYES: I think that's exactly what it represents. I mean, you know, I will admit to some shouting for it (ph), as I watched this spectacle ensue, but the breakdown in discipline from the party that has been, if nothing, ruthlessly disciplined and united often over the last eight years, is really something to see. And it's often the case that an army in retreat loses discipline. And so, it's not surprising that this is what we're seeing. What is surprising is that we're seeing it before Election Day even happens.

OLBERMANN: Chris Hayes, the Washington editor for "The Nation." "More rogue" is the phrase. Many thanks, Chris.

HAYES: Thank you, Keith.

OLBERMANN: Palin's roguery not the only problem for the GOP today. Proud Palin endorser, Senator Ted Stevens of Alaska, becoming only the fifth senator in U.S. history to be convicted of a crime in office. A jury today convicting Stevens on seven counts of lying about the free work his oil companies buddy did in not only in Stevens' home, $250,000 worth of free work. At 84 years old with no priors, Stevens is not expected to do much time, if any, despite the five years in prison prosecutors could seek for each charge. Stevens says he will stay on the ballot next Tuesday for his seventh full term as senator of Alaska, and legally, he could still serve if he wins, but his conviction is not politically helpful for Republicans hoping to minimize Democratic gains in the Senate. Word for Palin who has been running on the claim that she cleaned up corruption in Alaska, today, she called Stevens as an example of the corruption she was elected to fight, without actually calling on him to resign, and declining to answer whether or not she might still vote for him. Meantime, Senator Biden laughs off a question comparing his running mate with Karl Marx, the anchor was not joking. Why was a healthreporter questioning the vice presidential candidate. McCain in the Membrane is coming up. And in Worsts: Senator Joe Lieberman starts his great national backtrack. A week out from Election Day, and suddenly, Barack Obama isn't such a bad guy. All ahead.

You're watching COUNTDOWN on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: May not have seemed that way at the moment, but on this date in 1939 the world got a lot funnier. Besides being one of the driving forces behind the impeccable "Monty Python's Flying Circus", he is a writer, producer, actor and singer and we found out on this program a poet, John Cleese who allowed me to debut his poem "Ode to Sean Hannity" a few weeks ago. If you remember its conclusion, "Oozing with vanity, Plump as a manatee," Happy birthday to John Cleese. Let's play "Oddball." We begin back at the hockey rink. You will recall that on October 11, Governor Palin was showered with boos as she dropped the ceremonial first puck here in Philadelphia for the Rangers and the Flyers. Flyers sources tell me here tonight by the way that at the direct instructions of the team's owner, recordings of cheering was pumped over the public address system as Governor Palin was introduced to drown out any booing. It didn't work and the Flyers lost that game and then lost their next five. Friday, in St. Louis, Palin tried again. Standing on a blue carpet she dropped the puck for St. Louis and the L.A. Kings. But once again the Blues did not escape the Palin curse. Before the governor went out there, watch Blues goalie Manny Legasse (ph) taking the ice for pregame warm ups and slipping on Palin's Blues carpet. The goalie strained his hip. The Blues got shut-out four nothing. They lost again Sunday. Now the rest of the National Hockey League is asking that Sarah Palin she suspend her puck dropping campaign. To Dallas, where they've got some set of balls, beach balls, everybody. These are the world's largest measuring 65 feet tall. And they are about to crush those people. No, they're OK. It's a publicity stunt sponsored by a cruise line trying to drum up some business. Scores turned out to whack at the big shiny objects until just like a day at the ballpark a killjoy 427 foot groundskeeper flattened the balls like pancakes. Finally, to the Interwebs, this is the view looking out from the business end of a Target store, somewhere in America. And a textbook demonstration of how not to unload shopping carts from an 18-wheeler. Ever wonder why you always get the one with the gimpy wheel? It's because they all have gimpy wheels now, thanks, boys. The magic mark of 270, the latest NBC map has Obama vaulting past that figure. Will the Republicans rethink throwing money at the McCain campaign in light of that? Should they? And what John McCain should be doing after the Ashley Todd hoax. A campaign comment on the Republican nominee's missed chance to offer some leadership. But first, the most outrageous or untrue things said by or on behalf of Republican presidential nominee John McCain. "McCain in the Membrane." Number three, change of address. Vice presidential hopeful, Palin tries a new smear against Obama and once again ends up stepping in it.

(BEGIN VIDEO CLIP)

GOV. SARAH PALIN, ® VICE PRESIDENTIAL CANDIDATE: "The New York Times" reported that Barack Obama's inaugural address is already written.

CROWD: Booing.

PALIN: Nine days out from the election. Nine days out and yet it's already written.

(END VIDEO CLIP)

OLBERMANN: Except it's not. She's lying through her teeth. What she is referring to is a sample inaugural address written by John Podesta, who by the way was working for Hillary Clinton at the time that the address he wrote was published in his book this past summer. Such subtleties apparently are lost on the governor. Podesta, Obama, sample, actual, right, wrong, stuff like that there. Number two, country loving. Governor Palin nearly making the same blunder in Asheville, North Carolina this weekend that she made in Greensboro, North Carolina 10 days ago. That somehow North Carolinians are more pro-America and have more love for America than the rest of us.

(BEGIN VIDEO CLIP)

PALIN: This is where the goodness and the courage, the best of America is. It's in these areas where you love America. You have never been not proud to be an American. You are proud to be an American.

(END VIDEO CLIP)

OLBERMANN: Oopsie. Remember that horrific '70s sitcom, "Love American Style." The governor thought it was a political tract.

Number one, gotcha journalism, Senator Joe Biden finding himself in a truly surreal "interview", with quotes around, with local Florida TV station WFTV in Orlando last week. The reporter, Barbara West, whose station biography lists her primary job as health reporter asking him questions like, quote, "Aren't you embarrassed by the blatant attempts to register phony voters by ACORN, an organization that Barack Obama has been tied to in the past?" And, "Are you forewarning Americans that nothing will be done and America's days as a world leading power are over?" And, "What do you say to the people concerned that Barack Obama will want to turn America into a socialist country much like Sweden?" And even quoting Karl Marx to Biden.

(BEGIN VIDEO CLIP)

BARBARA WEST, WFTV ANCHOR: How is Senator Obama not being a Marxist if he intends to spread the wealth around?

SEN. JOE BIDEN, (D) VICE PRESIDENTIAL CANDIDATE: Are you joking? Is this a joke?

WEST: No.

BIDEN: Or is that a real question?

WEST: That's a question.

(END VIDEO CLIP)

OLBERMANN: So where did Ms. West get her real questions for the Democratic vice presidential nominee, questions that sounded remarkably like every right wing talking point expounded by the McCain campaign and the far right talking heads? Surely, it's just a coincidence that her husband is a GOP media consultant.

(COMMERCIAL BREAK)

OLBERMANN: As Barack Obama continues to make progress across the electoral map over John McCain, that's sparking a whole new unexpected problem within the Republican Party, how to turn around this so-called mess. That was the quote from Newt Gingrich.

Our third story on THE COUNTDOWN, the RNC and its campaign coffers. Is John McCain no longer the wisest investment? Here's the map that should be giving them all pause. The MSNBC electoral outlook which shows Obama officially over 270, with a 286-163 lead, up from 264-163 just a week ago. Colorado and Virginia having moved from "toss-up" to "lean Obama." And McCain's home state of Arizona no longer now rock solid in the McCain column. The ripple effect of the dismal campaign being felt down the ballot. The GOP now defending 23 Senate seats. The Democrats 12. In the House, 29 to the Democrat six. Leaving the Republican National Committee, having to decide whether to cauterize the down ballot bleeding or to keep throwing money at a losing McCain campaign. Democratic strategist and former communications director for the John Edwards campaign, Chris Kofinis joins us now. Chris, Good evening.

CHRIS KOFINIS, DEMOCRATIC STRATEGIST: Good evening, Keith.

OLBERMANN: David Frum virtually wrote this in the "Washington Post" yesterday. He didn't come out and say it but the only conclusion that he had there was, cut the losses, stop spending money on the presidential campaign and just worry about salvaging stuff in the Senate and in the House. Is he right?

KOFINIS: Well, eight weeks ago, when it looked like a close presidential race, he probably wasn't right. But what's happened, especially with the financial crisis, the bottom fell out. And now you're seeing the Bush-McCain dynamic just killing down ballot races, and races Republicans never thought they would have to defend, they're not only defending, they actually may end up losing on election night. This has become a Republican ship that's sinking pretty fast. And they are trying to figure out how to stem the bleeding. What's happening now is everyone is a man for themselves, if you will. And they are trying to wonder how do you stop this political realignment, this map that is now expanded to include battlegrounds they never thought were possible in the Obama campaign. And that is a big problem for them. So I think there are definitely some Republican leaders that want to focus on the Senate races. The question is, are they going to abandon McCain? And that part is going to be an interesting statement. Because if they do, I think you are going to see the ship completely sink and the Republicans are going to face a real tidal wave in November.

OLBERMANN: All right. Obviously the thinking behind this is that's what's going to happen unless things are shifted anyway. So is it worth the possibility of rather than having the only - if the Democrats prevail in the House and they grow the lead in the Senate, if there is 60 Democratic senators, the only power institutionally in this government for the GOP would be the filibuster in the Senate. Is it better to try to put some of the money, A, in the Senate races or B, in the House races? Which is the priority if you were to say, abandon McCain?

KOFINIS: My guess is if they choose to abandon McCain, they are probably going to focus on the Senate. They want to basically stop a filibuster proof majority for the Democrats. You basically have five races that right now are strongly leaning Dem. Colorado, New Mexico, New Hampshire, Virginia, now, Alaska.You have three others, you have Oregon, North Carolina and Minnesota that are leaning Dem and two others, in terms of Georgia and Kentucky with Mitch McConnell, which is unbelievable if you think about it. The minority leader for the Republicans who is in real jeopardy. They want to try to stop those last five from going Democrat. My guess is they are not going to be able to stop all five. They are going to have at least two or three that are going to go Democrat because the tidal wave that has happened now is not simply about Senator Obama and a great campaign, it's a repudiation of the Republican Bush philosophy that McCain has embraced. The American people are screaming across the board in down ballot that they want to go a new direction and the Republicans have gotten swept into this and they are really suffering for it.

OLBERMANN: We are hearing all of these quotes about the GOP mess, the Newt Gingrich quote which I read before, for a refresher. "It's not where we should be. It's not where we had to be. This was not bad luck." What took them all so long to get to this point when others saw this coming? Was it denial? Was it lack of political savvy? Did they simply not want to believe they were going to get to this stage?

KOFINIS: It was denial. I am not sure if they've been watching the McCain campaign over the last many months. Remember, this is the McCain campaign that basically took five months off where they neither defined their candidacy nor did they define their potential opponent.

And then, you've see a campaign dominated by a lack of message, no real strategy, gimmicks and tactics. And unfortunately they have been suffering because of it. So the notion that somehow this came out of the blue and they didn't see this coming, I have a hard time believing. This was a campaign that I think people saw the wheels coming off really early. So unfortunately the McCain campaign is in the state they are in, but they have really no one to blame but themselves. They put themselves in it and the Republicans are going to suffer for it.

OLBERMANN: Not that they are not trying to find other people to blame. Chris Kofinis, the former communications director with the Edwards campaign, thank you Chris, take care.

KOFINIS: Thanks, Keith.

OLBERMANN: McCain facing obviously an uphill battle for any electoral chance. But he could win back a great deal of respect, at least, if he would break his silence on the hoax perpetrated by the young woman who said a black man had mugged her and carved a B for Barack into her face. A campaign comment ahead.

And in worsts, "The Washington Post" succumbs to the will of Bill O., the clown. What could he do, what could he have done, what do they do back? Ahead on COUNTDOWN.

(COMMERCIAL BREAK)

OLBERMANN: One of the ugliest incidents of this ugly campaign, a McCain campaign volunteer claiming she was attacked by a black man who carved a B for Barack into her cheek. The story highlighted and disseminated by the McCain team until it proved false.

Tonight a "Campaign Comment", Senator McCain, it is time to speak up about this. That's next. But first, time for COUNTDOWN's number two story tonight, "Worst Persons in the World." The bronze goes to "The Washington Post." Last week, the newspaper ran a story about Bill O. the Clown with a photograph and a caption that described him as a right wing pundit. The Frank Burns of news was disturbed by that description. So he raised a stink and got the paper to print a correction stating "a photo caption in the October 22 Style section incorrectly referred to Bill O'Reilly as a right wing pundit. The Fox News host presents himself as an independent." They could have also gone with official loofah inspector or he's a Nielson ratings conspiracy theorist or a bold fresh piece of expletive of second place to COUNTDOWN on Friday for the third time in 10 weeks. Thanks, viewer. The silver to the independent senator from Connecticut Joe Lieberman who is reading the polls and beginning to talk out of the other side of his mouth. About the man nominated by his former party Senator Lieberman told the "Hartford Courant" quote, "When I go out, I say I have a lot of respect for Senator Obama. He's bright, he's eloquent." This respect comes from senator who once said, when asked if Senator Obama was a Marxist, quote, "That's a good question." Newfound respect for the senator he accused of voting against funding for troops in Iraq, even though John McCain did the same thing using the same bogus criteria in that first charge. But the winner, Chad Michael Morissette (ph) of West Hollywood, California in a misguided Halloween prank dressed up a female mannequin to look like the Republican vice presidential nominee Governor Palin and hung it with a noose from his roof. Morrissette also fashioned a McCain mannequin to look like it was on fire in his chimney and called the display art in the spirit of Halloween. No, uh-uh, as unacceptable as if it were McCain as if it were Obama. This is not the spirit of Halloween, it's the spirit of violence. Chad Michael Morrissette, today's worst person in the world.

(COMMERCIAL BREAK)

OLBERMANN: Finally, a "Campaign Comment" about the fraudulent race attack claim since acknowledged and recanted by a John McCain campaign volunteer in Pennsylvania. You know the story well, by now. It's a sad and demoralizing tale of a woman who could be summarized by the awful term B actress. Ashley Todd was not sexually assaulted by a big black man. He did not carve the letter B on her face to punish her for supporting John McCain. It apparently never dawned on her it resembled less a cut than an abrasion done by a weapon no more sinister than a nail file. She was not even at the ATM where she claimed the attack took place. It apparently never dawned on her that the machine had security video and she would not be on it. And clearly, somewhere in her mind was a calculation that a story like this one with layer upon layer of racial threat could be some kind of game changer for the presidential candidate she worked to get elected in at least two states for at least two months. Her saga is pathetic. She now claims mental illness. If this too is not true, Miss Todd might think she's pulling another fast one over on the rest of us. In fact her claim seems to be accurate, whether she knows it or not.

And much more disturbingly, so was her calculation. At least until her story, in retrospect a ludicrous confection, fell apart and she had to confess her crime. She had inspired dozens, perhaps hundreds of journalists and bloggers and all those in between on both political sides to stand over this nation's ever present tinderbox of racial prejudice and racial fear and racial hatred. And she had brought them all matches. We already know what the executive vice president of Fox News had written while his organization was perched next to that tinderbox waiting for the slightest excuse to light it and our nation ablaze. The over the top, caveat thrown in for window dressing balance with not the slightest intention that it ever be taken seriously. Quote, "If the incident turns out to be a hoax Senator McCain's quest for presidency is over, forever linked to race-baiting." That is the well-known part of what John Moody wrote. What preceded it was far less publicized and far more important. "Part of the appeal of, and the unspoken tension behind, Senator Obama's campaign," he wrote, "is his transformational status as the first African-American to win a major party's presidential nomination. That does not mean that he has erased the mutual distrust between black and white Americans and this incident could become a watershed event in the 11 days before the election.

If Ms. Todd's allegations are proven accurate, some voters may revisit their support for Senator Obama, not because they are racists, with due respect to Representative John Murtha, but because they suddenly feel they do not know enough about the Democratic nominee."

Moody wrote that. It wouldn't be racism to suddenly blame Barack Obama for an attack on a white woman by a black man intending to punish her for not supporting another black man. It would instead by a watershed moment because it somehow meant, "They suddenly feel they do not know enough about the Democratic nominee." Its only connection would have been racial. But the response would not be racism. The tinderbox again, and a very large match provided by John Moody. I know that man. He is not stupid. Not careless. He has in fact an education background identical to my own, right down to the same college radio station. He knew what he was writing. A rationalization for racism. That Moody should be fired goes without saying. But if not fired that he should resign in shame is also obvious. Neither will happen because there is no one of sufficient authority to reproach him. And the others, who but for Ashley Todd's inability to maintain her inner hoaxster for more than two days would have solemnly and grimly and some secretly, happily set this presidential campaign on its ear and knocked this nation's tenuous grip on the relationship between the races off its axis. Because there was nobody to say, "No. Don't." This is where you come in, Senator McCain. No histrionics from me to you this time, Senator. No yelling. Just a plea. Say something about this. Now. Say something strongly and succinctly about the unacceptability of what happened, and how some of your supporters tried to exploit it. I am not asking you to assume the responsibility for this. No matter how your campaign pushed this story, I have no doubt that in the mirror image scenario many of Senator Obama's supporters would have done the same. But I also have no doubt that by this point in that mirror image scenario, Senator Obama would have said something to try to stop the next Ashley Todd, or the next John Moody. Senator, of all the things I don't like about you or your campaign, I have never thought you a racist. As imperfect as was your moment with that Minnesota woman mumbling about Arabs, I thought it was the finest moment of your campaign. I believe that you feel as I do, that racial prejudice and hatred have no place in this campaign, nor in this country. I believe that you feel as I do, as Clarence Darrow said in a different time and a different context, "I am pleading for the future. I am pleading for a time when hatred and cruelty will not control the hearts of men. When we can learn by reason and judgment and understanding and faith." Sometimes, Senator McCain, it is as if we are almost there. And then some unthinking act like the one by that Ashley Todd throws us back against the rocks and we barely escape with our ship intact. In that time of foundering, Senator McCain, far too few of us have a chance to personally right the ship. To heal instead of to stand idly by. To make a difference in this oldest and most wearying of our struggles as a nation. This chance, sir, is yours. Say something. Or better yet, say something with Senator Obama, about race and how we live with one another and how we can. Let this last week of the campaign be remembered, no matter how it turns out next Tuesday, as something other than the time Ashley Todd lied, and the John Moodys threatened, and you said nothing. Senator McCain, once again, grab the microphone. Thank you. That's COUNTDOWN for this, the 2007th day since the declaration of "Mission Accomplished" in Iraq. Up next, RACHEL MADDOW SHOW. From Philadelphia, I'm Keith Olbermann. Good night and good luck.

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

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