updated 1/16/2009 11:37:22 AM ET 2009-01-16T16:37:22

Guests: Chuck Todd, Barbara Boxer, Joe Conason, Frank Gaffney, Pat Buchanan, Clarence Page

CHRIS MATTHEWS, HOST:  Coming soon, it is OK to say gays to serve openly in the military. 

Let‘s play HARDBALL. 

Good evening.  I‘m Chris Matthews. 

Leading off tonight:  The dogs bark.  The caravan moves on.  That‘s the picture here in Washington six days and counting before the presidential inaugural, lots of barking, some bite, but nothing to stop the march of change. 

Start with don‘t ask/don‘t tell.  Bill Clinton started this policy of telling gay recruits not to openly declare their sexual orientation.  Well, this just out:  Obama‘s going to stop it.  Starting soon, at a recruiting base near you, you will be able to sign up and speak up right on the spot. 

Speaking of full disclosure, the Senate Foreign Relations Committee wants Bill Clinton to post any big contribution to his global humanitarian efforts the moment he gets that contribution.  Will the Clintons obey?  Will Obama tell them to obey?

And why can‘t the guy who is going to set and enforce tax policy in this country pay his own taxes on time?  Is this a big problem, or, as Obama admits, just an embarrassment? 

(BEGIN VIDEO CLIP)

BARACK OBAMA (D-IL), PRESIDENT-ELECT:  Is this an embarrassment?  For him, yes.  He said so himself. 

(END VIDEO CLIP)

MATTHEWS:  So, is this any way for a short-term—well, is it anything more than a short-term distraction? 

And does the guy getting off the stage deserve credit for America not being hit by terrorism?  Since 9/11?  I‘m talking about George W. Bush.  And will history remind him and us that he was president on 9/11?

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  While there‘s room of healthy debate about the decisions I have made—and there‘s plenty of debate—there can be no debate about the results in keeping America safe. 

(APPLAUSE)

(END VIDEO CLIP)

MATTHEWS:  Well, Mr. President, here at HARDBALL, we think there ought to be some debate on that very point. 

Also, Obama broke bread with a tong of his conservative critics in the press last night.  He dined at George Will‘s house, along with William Kristol, David Brooks, and Charles Krauthammer.  Is this about keeping your friends close and your enemies closer, or is this smart politics?  We will get to that in the “Politics Fix.”

And, finally, what confectionery creation is a Chicago bakery making for Obama‘s inauguration?  That and more in the HARDBALL “Sideshow” tonight. 

But, first, we begin with Senator Barbara Boxer, California Democrat, member of the Foreign Relations Committee. 

Senator Boxer, it‘s great to have you on tonight. 

I‘m amazed that the president coming in to office who you supported so passionately has a lot of guts, as we know. 

SEN. BARBARA BOXER (D), CALIFORNIA:  Yes. 

MATTHEWS:  He is coming out, according to Robert Gibbs, to end the don‘t ask/don‘t tell policy, to allow people who want to serve their country whose orientation is gay or lesbian to come out and say so as part of their lifestyle.  They‘re allowed to say it.  I should say just part of their regular living experience.  They are allowed to say what they are.  It is not—does not have to be a secret. 

It that good policy, this change, and will Congress approve it? 

BOXER:  Well, I hope Congress does approve it.  I can‘t say that they will or they won‘t, because I haven‘t really focused on it.

But I can tell you this.  For people to hide a very basic truth about themselves is just very unhealthy for everyone.  And the fact is, if you look at military recruitment, when we really need to get people into the military, it turns out, you know, we really don‘t pay much attention to their sexual orientation. 

Nobody asks you about that if you are under fire.  So, it is only

when, you know, times are kind of slow, that people think about it.  It is

it‘s about time we overturn that.  It is—it is foolish, because we have so many gays in the military, and having them hide who they are is—is very cruel.  They are patriotic.  They are loyal.  They—they—they fight. 

Here‘s the point.  It seems to me you should just judge someone by the way they behave.  There is a very strict military code.  If you break it, you are out.  And that‘s how it should be.  We shouldn‘t have special rules based on sexual orientation. 

MATTHEWS:  Let me ask you about the hearings you sat in on yesterday as a member of the Senate Foreign Relations Committee.  I‘m curious, because it—it got a little murky there. 

Up front, the ranking member, Dick Lugar of—of Indiana, sort of a centrist Republican—he has sort of been over—he‘s no right-winger—he came out and said he didn‘t think that the restrictions the Clintons had agreed to with regard to disclosure were sufficient.  He thought they ought to—the former president ought to announce right up front if he takes a contribution of more than $50,000 from abroad.

BOXER:  Right. 

MATTHEWS:  In fact, he said, ideally, he shouldn‘t take any money from abroad. 

“The Washington Post” today basically backed that up, and pointed out that—that John Kerry, the—the—the chairman of the committee, a Democrat, had gone along with that principle as well. 

Where do you stand on the idea of further disclosure by the Clintons? 

BOXER:  Well, I always am in favor of the most disclosure possible, because I don‘t think that Hillary Clinton is going to know who gave her husband a contribution, nor do I think it will affect Barack Obama‘s foreign policy, which she is really staffing.  She‘s carrying it out. 

However, I think it makes people feel better to know there is full disclosure.  I think Hillary is right—Senator Clinton is right—when she says, no other president has revealed anything about their—who they get money from for their nonprofits.  And the president is going to do this. 

But I say the more the better, to the extent practicable.  But, honestly, Chris, you know, President Clinton has his foundation.  Hillary Clinton will work for Barack Obama.  He is going to set the policy.  She is going to carry it out.  And I am just not that worried. 

And—and I just don‘t think it is going to be a stumbling block.  I

I predict she will get a huge vote in the Senate, and get it quickly. 

MATTHEWS:  Well, here is what “The Washington Post” wrote today in its editorial—quote—“Ms. Clinton would be doing herself and Mr. Obama a favor by pressing her husband to accept greater disclosure, or, better yet, to suspend foreign fund-raising.  Otherwise, the questions raised by senators yesterday will haunt her, and her president, throughout their tenure.”

Let me ask you about this matter.  Is this a big...

BOXER:  Well, I just think—I just think...

(CROSSTALK)

MATTHEWS:  Well, go ahead.  I‘m sorry. 

BOXER:  Yes. 

I just think that is such an overstatement, “will haunt her.”  I mean, the fact is, Bill Clinton is doing extraordinary things with his foundation, to stamp out poverty, to help stamp out poverty, help stamp out AIDS, malaria, T.B., all the rest, start, you know, people on the road to well-being. 

And it is only going to inure to the benefit of the United States of America.  It is—it‘s winning the hearts and minds of the people abroad.  So, let‘s just say it is a very noble thing that the president is doing, full disclosure to the extent possible. 

But I honestly don‘t think that Hillary Clinton, as secretary of state to Barack Obama, is going to, first of all, form foreign policy.  It is going to be his foreign policy.  She will be carrying it out.  I‘m not that worried.

I think “The Washington Post” got a little bit overexcited about it. 

That‘s just my opinion. 

MATTHEWS:  Let me ask you about this other matter.  And then we will move on to the question of the hearings tomorrow coming up on Eric Holder. 

Tim—Tim Geithner, the nominee for the—the appointee for secretary of treasury, had a bit of a little tax problem.  Here is Barack Obama talking about that just now.  Here he is. 

(BEGIN VIDEO CLIP)

OBAMA:  Is this an embarrassment for him?  Yes.  He said so himself.  But it was an innocent mistake.  It is a mistake that is commonly made for people who are working internationally or for international institutions.  It has been corrected.  He paid the penalties. 

And as I have said before, if my criteria, whether it was for Cabinet secretary or vice presidents or presidents or reporters was that you‘d never made a mistake in your life, none of us would be employed.

(END VIDEO CLIP)

MATTHEWS:  Wow. 

What—what...

(LAUGHTER)

MATTHEWS:  Is it that—is it just—it just seems so often, Senator, that, every time somebody gets up for a big job, there seems to be some sort of nanny problem or a tax problem. 

Is this endemic?  What‘s this among better—people that make big incomes, or does everybody—it just strikes me there is a familiar tone to this whole thing about him not paying his taxes because worked for the IMF, and then not having all his papers straight about somebody who wasn‘t documented working for him. 

BOXER:  Look, this happens from time to time.  And—and that‘s why we have a confirmation process, to get to the bottom of it. 

You know, just listening to the president-elect, it—it is obvious to me he has been very, very briefed on this.  Barack Obama has a very high set of standards for people working for him.  And I tend to trust him. 

When I first read about this with Tim Geithner, I was very troubled by it at first.  And I didn‘t understand that, when you work for an international organization, it is kind of a different set of rules, in terms of there not being withholding, et cetera.  It is complex. 

But I think president-elect Obama has stated it—stated the case as it should be stated.  I think Geithner will be all right.  I—I‘m waiting to see what the committee of jurisdiction does before I can give you a definitive answer.  But he had the best lawyer he could get today, Barack Obama. 

MATTHEWS:  Right. 

Let me ask you, finally, about this.  We are going through all the vetting of these top people.  Everybody has a certain nick in their record.  Everybody—nobody is perfect, obviously, as the president-elect put it. 

BOXER:  Right. 

MATTHEWS:  What do you think of Eric Holder in this?  Should he bear the brunt of the decision by the former President Bill Clinton to grant pardons to Marc Rich in one case and to those Puerto Rican nationalists in the other case? 

Do you think these are the kinds of things that the president, the principal should bear the brunt for, or his—his lieutenant, in this case Eric Holder, who is now facing the confirmation hearing tomorrow?

BOXER:  That‘s such a great question, Chris. 

Here‘s what I think.  I think that you are responsible for everything you do in your life, and you do make misjudgments, and you do make mistakes.  And I think, in a case like this, you have to look at Mr.  Holder‘s entire record. 

For some people, they may think this is a deal-breaker.  For me personally, this was what President Clinton wanted to do.  He asked for advice.  He got advice.  I personally didn‘t agree with both of those pardons.  But the fact of the matter is, you have to look at Mr. Holder‘s entire record.

And, when you do, you know, if you just take a piece of paper, and you draw a line down the middle, and you say good things he has done and bad things he has done, I think, overwhelmingly, he has done so many great things, that, at the end of the day, I think he will make the case well. 

As I said, everybody does make mistakes.  He, I believe, made a mistake.  Now, I don‘t know if he feels that way.  I‘m waiting to hear what he says.  But I think this is a man of great accomplishment, and this is a little stain on the record.  And, again, let‘s see how he handles it at the confirmation.  But, again, I think he will make it. 

MATTHEWS:  Thank you very much. 

This has been—why do you think this is going so well?  I mean, we‘re talking—we are part of the dogs that are barking.  It is our job to bark when people go by. 

BOXER:  Yes. 

MATTHEWS:  But the caravan moves on. 

According to the latest polling, this president-elect has the highest

approval rating of anybody since Ike, General Eisenhower, back in his

second term, back in ‘55, going into the second term—actually, 56, ‘57 -

the most popular record, in terms of public approval for a transition effort since him.

What‘s his—what is the power here?  Why is Barack looking so good to the public? 

BOXER:  People need to have Barack Obama succeed. 

Look at what‘s happening, two wars never-ending.  We have got this horrible economy, terrible stock market, people suffering.  Health care is in a mess.  Deficits are in a mess.  Debt is in a mess.  The financial system is sinking.  People need to believe in something again. 

Barack Obama comes to this office with an amazing set of attributes that I think people responded to.  And they are rooting for him.  And I think he will be given some time. 

MATTHEWS:  OK. 

BOXER:  And I am hopeful that he succeeds, because, if he does, America does. 

MATTHEWS:  OK.  Thank you very much, U.S. Senator Barbara Boxer of California. 

(CROSSTALK)

MATTHEWS:  Coming up in just six days, Barack Obama will be sworn in as the 44th president—by the way, six days from now.  And this city is ready, lots happening in this town.  I wish everybody could feel this excitement.  The scaffolding is going up.  Millions of people are on the road coming here already.  They‘re—everybody wants a ticket to something.  Everybody wants to stay at my house. 

How will this city and this country fundamentally change when Obama takes the oath of office?  Chuck Todd joins us next. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Coming later on HARDBALL:  Supporters of President Bush tout the fact that he kept America safe after 9/11.  Is that a safe—is that an appropriate measure?  Does he deserve that credit, or—and, if so, what about the time leading up to 9/11?  Wasn‘t he president then, too? 

Our look back at the Bush years, starting at the beginning, later—coming up on HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

Barack Obama‘s call for change—and that‘s the big word still here in Washington—propelled him to the White House.  In six days, it is all up to him to make that change happen.  How is he going to do it?  How is he going to show it?  How is he going to convince America we are on the move? 

Chuck Todd is NBC News chief White House correspondent and political director.  He‘s also the co-author—co-author of the big new book “How Barack Obama Won.”

Chuck, how Barack Obama won—the question I want you to translate is, how the way he won, how is that going to show us how he‘s going to try to win as president?  Big iconic events?  Lots of pictures?  How is he going to show us and sell us on his change? 

CHUCK TODD, NBC NEWS POLITICAL DIRECTOR:  Well, I want to take you back to February 10, 2007, Springfield.  You were there, very cold.  He did something that—what presidential candidates in the past had done a lot of, gave a reason for why he was running for president, gave a diagram, an outline for what he was going to do. 

Obviously, speechmaking is a very important tool to Obama.  And I think that‘s—that‘s the first hint.  But I—the reason I want to take you back there is that you do not have a comparative event for Hillary Clinton or John McCain, the candidate that finished second and third in this race for the White House. 

And they never announced.  They never gave an announcement speech.  They never gave—never gave the organizing theory as to why they wanted to be president. 

Barack Obama went out there and told the country why he wanted to be president.  He defined what change was between himself and Bush.  And, so, this is a guy that I think what that tells us is that, going forward, he‘s always going to be giving the big speech to define how he sells something. 

We saw that with the stimulus last week.  He gave a speech to try to outline exactly how it is going to be.  And he‘s always going—he‘s always going to try to have a—a message that he is pushing, and that it‘s going to be a complete spot.  I don‘t think you will see him be herky-jerky about things. 

I think there will—you will—there will be the big idea.  He may quibble with the details, and he may change the details and try to sell it.  But there will always be sort of this initial organizing principle that you will be able to see.  There isn‘t going to be a lot of shock about where he goes with something when it‘s policy. 

(CROSSTALK)

TODD:  I mean, we saw it—this isn‘t going to be like Bill Clinton, where, one minute, he‘s going to be doing this, and, the next minute, he is going over here and doing that. 

I think this guy, there is a reason the phrase no-drama Obama became so popular with those that covered him and those inside the campaign. 

MATTHEWS:  Yes. 

TODD:  They telegraph everything.  There aren‘t surprises with him. 

MATTHEWS:  You are so smart.  You know, that reminds me.  Bill Clinton, not to knock him, because he is brilliant in many ways, and did a lot of good things, but Bill Clinton, it should have—his—his salesmanship should have been something like those old drugstores that said “Sundries and Notions” on the outside.

(LAUGHTER)

MATTHEWS:  It was a bunch of different things.  You know, it was a variety store.

TODD:  Right. 

MATTHEWS:  But it didn‘t—and let me go back to this, because I thought it was interesting.  Whatever he is doing right now, 71 percent of the American people, according to our NBC poll, think he is doing a great, bang-up job in this transition. 

TODD:  Right. 

MATTHEWS:  Let me ask you about the big questions coming right now, tonight. 

TODD:  Mm-hmm. 

MATTHEWS:  I was stunned that he has been so courageous, if you will, in saying no more don‘t ask/don‘t tell.  If you are gay and you go into the military, you can say it right at the recruiting station.  You can tell the Marine guy in that spiffy uniform, OK, I want to be a soldier.  I want to be a Marine, and guess what?  I happen to be gay.  I want to be a soldier.  I will obey the rules, like everybody else.  But I want to let you where I stand in terms of my orientation. 

That‘s a dramatic step forward, if he can get that through Congress. 

But it is going to cause some—some noise. 

TODD:  It is. 

And it is going to have some wondering, wait a minute, this is exactly how Bill Clinton got off on the wrong step.  Don‘t get distracted.  Don‘t get into a fight on something that takes your eye off the ball.  And in this case, the ball is the economy and creating jobs.  And actually...

MATTHEWS:  Well...

TODD:  ... it‘s creating jobs and focus on the economy.  So I think he does feel...

MATTHEWS:  He‘s doing it, though, Chuck.  He‘s doing it.

TODD:  I know, and he feels—and I think part of this—you wonder, is this pressure over the criticism he got from the gay community, over the decision to bring in Rick Warren for the inaugural?

MATTHEWS:  Well...

TODD:  ... And is this a tip of the cap, saying, Look, I‘m not—you know, I am—you know, I will be—as controversial as it will be to gay Americans that I‘m bringing Rick Warren in, while I‘m also going to—I‘m not afraid to start a fight about gay rights when it comes to the military.  That may the message he wants to send, and so be it.  There will be some that say, Wait a minute, don‘t get caught in the same trap Bill Clinton got caught in back in ‘93.

MATTHEWS:  Yes, well, the voices that are going to be heard are the people who‘ve served in the military, men and women who‘ve served the military, who will know that they‘ve served with people who are gay in orientation.

TODD:  Right.

MATTHEWS:  And they will have a view about that.  And some people will say, You know, a lot of my friends in the military were gay, no problem.  I knew about it.  It didn‘t get in my way.  It didn‘t distract me from my duty.  Others will have different views.  We‘re going to hear from the generals on this.  This is going to be interesting.

Let me ask you about other iconic things to come.  He‘s going to close Gitmo...

TODD:  Right.

MATTHEWS:  ... right?  He‘s going to end this war in Iraq.  He‘s going to have stem cell research paid for by the federal government.  He‘s going to release that $350 billion from that bail-out money.  Lots of shock and awe in terms of policy coming out right away, right?

TODD:  Well, I think—yes, I mean, look, I think whoever was going to be president, because of the circumstances they‘re inheriting the presidency, was going to be forced to be big in a lot of ways, just big in reactions, in the same way Bush became big after 9/11.  It doesn‘t matter whether you agree with his big ideas or disagree with them, he was forced to be big.  Big challenges end up forcing a president to have to make big decisions and deal with big ideas.

And I think that that is—the sheer volume of that money, that $350 billion, obviously—coming on the heels of also trying to sell his own stimulus package.  The stem cell thing I think is something—I don‘t know how—you know, we may not know the effect of something like that for 20 or 30 years.  So that is...

MATTHEWS:  Yes.

TODD:  That is one I don‘t know if he‘s going to get judged on as early any time in his own political life, for the remainder of his political life, so...

MATTHEWS:  Well, let me tell you, people who have Alzheimer‘s in their family are rooting for something to develop in that area, and other diseases that require real, you know, cell technology...

(CROSSTALK)

TODD:  Chris, he‘ll always connect it to jobs.  I think one of the things we—we ought to—that you‘ll see the guy...

MATTHEWS:  To buy (ph) a technology.  You got to buy a technology, right.

TODD:  Exactly.  Everything is about jobs with this administration right now.

MATTHEWS:  Before we leave, I want to realize—you are smart to talk

to me as a colleague to talk about this.  Every one of these big, dramatic

decisions he makes, whether it‘s gays in the military, it‘s the $3 billion

$350 billion in the bail-out money that hasn‘t been allocated yet, or closing Gitmo, are complicated.  Gays in the military, in terms of open service, is complicated—you know, submarine service, close quarters, in battle situations.  You have romances.  You know, these kinds of things have to be dealt with through the code of military conduct.  It has to be enforced.  There has to be a disciplinary approach.  It is more complicated to serve openly.

But I wonder—you know, it doesn‘t take away from the need for a strong thrust to say what you believe in terms of values.  So I‘m asking you, can a strong thrust by him in saying where I stand in principle get past and push through the complicated nature of making these things happen?  Can he make it happen?

TODD:  He has a lot of leeway right now.  I mean, you saw—he‘s in the middle of a honeymoon we have not seen a president have in the modern era, all right?  He‘s not even president yet, but he is in the middle of this huge honeymoon.  So yes, he can push things through, and I think that that is what some of his most ardent supporters are looking for him, is sort of—he‘s got all this political capital.  Part of it is out of desperation, OK?

MATTHEWS:  Yes.

TODD:  You have a lot of people who are rooting for him because their own—their own life is in so much trouble, their own economic...

MATTHEWS:  Yes.

TODD:  So he can get through some of these little things, if he really wants to.  If he wants to push, he can get it through and he may get it without a lot of drama as long as there‘s always sort of a big push on the economy front.  I mean, he is still going to be defined by the unemployment number in 2012.  If the unemployment number...

MATTHEWS:  Well, my...

TODD:  ... you know, is 11, you know, .2, doesn‘t matter how incredible every State of the Union speech he‘s given or great ever speech he‘s given, the country‘s going to be upset.

MATTHEWS:  I agree with you completely.  Thank you very much, Chuck Todd, for that smart analysis.  Your new book is called “How Barack Won,” a great way to get through the numbers and understand what really happened the last month, two months ago now, before it passes in to history.  You can get this book now and see current history.

Up next, the HARDBALL “Sideshow.”  Don‘t forget, this Saturday, Barack Obama and Joe Biden arrive in Washington by train as they get ready for the inauguration.  They‘re coming here the way Lincoln came here from Philadelphia on that train.  We‘ll have full coverage all day Saturday.  Join me between 5:00 and 7:00 for three hours of coverage—that‘s Eastern time—for our expanded edition, Saturday edition, of HARDBALL.

You‘re watching it, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  OK, back to HARDBALL.  Time for the “Sideshow” tonight.  Can‘t we all just get along?  That‘s the theme of this week‘s run-up to next Tuesday‘s presidential inaugural, showing that Washington does not have to be a city of relentless dog-eat-dog, take-no-prisoners, my-way-or-the-highway partisanship.  Change, that‘s what‘s happening here this week.

To make this point, last night Barack Obama attended a dinner at the house of conservative columnist—there he is going in the door—George F. Will.  It was a dinner that other right-leaning columnists, including Bill Kristol, David Brooks and Charles Krauthammer also attended.

OK, so it wasn‘t the most exciting crowd to spend an evening with. 

Anyway, can you imagine even for a nano-second our own President George W.  Bush of Crawford, Texas, even thinking of breaking bread with his political flip side, oh, people like “New York Times” columnist Paul Krugman?  The fact that Obama is already doing what W. never thought of doing tells you something‘s up.

Well, next up, democracy at work.  This afternoon, battling Rod

Blagojevich, the under-attack Illinois governor—we call him B-Rod here -

oversaw the—you won‘t believe this—the swearing in of the new state senate out there.  What‘s noteworthy about this is that those 59 state senators whose swearing-in he just oversaw will be the jury this month of Blagojevich‘s impeachment trial.

Time now for tonight‘s “Big Number.”  A Chicago bakery has a very

sweet, very large inauguration gift for Barack Obama—I love this stuff -

giant cheesecake.  There it is.  Eli‘s (ph) Cheesecake Company designed the cake specifically for Obama‘s Lincoln-themed inauguration by adding an apple filling, attributed to President Lincoln‘s love of anything apple.  I learned something there, Lincoln liked apples.

So when all is said and done, just how big will this inauguration confection be, this cake?  It‘s a 500-pound cake.  Talk about a pound cake.  That cheesecake will be shipped to D.C. and served to over 3,000 servicepeople and their families at the commander-in-chief‘s inaugural ball next week, a Chicago bakery‘s quarter-ton tribute to Obama‘s inauguration, tonight‘s “Big Number.”

Up next, the inauguration of Barack Obama‘s just six days away right now, and America will turn the page on the Bush presidency.  We continue tonight our long look backward at the Bush presidency.  Up next, we‘ll examine one claim you hear a lot from Bush supporters these days, that President Bush kept America safe after 9/11.  No question, there were no attacks after 9/11 here in this country, but is it fair to start the clock on the success of this administration in the security area on September 12th, 2001?  That debate, hot one, coming up here next.

You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

(CNBC MARKET WRAP)

MATTHEWS:  Welcome back to HARDBALL.  All this week, we‘re taking a different look at aspects of the Bush presidency.  As we look forward, we also look backward.  Today we‘re looking at the issue of keeping America safe.

As President Bush makes his round of final speeches, his long good-bye with interviews, et cetera, he‘s taking credit a lot of times, fairly or not, that the United States was not attacked after 9/11.  In other words, ever since September 11, 2001, after that horrendous attack in New York and here in Washington on the Pentagon, we have not been hit at home.  Is he due credit for this?  This is a big question for the historians.  And what‘s been the cost, if there has been one, in terms of America‘s record morally in the world, militarily in the world, the loss of life in keeping that record?

Joining me is Joe Conason of “The New York Observer” and Frank Gaffney of the Center for Security Policy.  Gentlemen, thank you for joining us.

The White House has released a list, a fact sheet, if you will, or areas of which—where the United States was threatened, in fact, there was an attempt to hurt us since 9/11: an attempt to bomb fuel tanks at the JFK airport, a plot to blow up airliners bound for the East Coast, a plan to destroy a Los Angeles skyscraper, a plot by six al Qaeda-inspired individuals to kill soldiers at Fort Dix in New Jersey, a plan to attack a Chicago-area shopping mall, a plot to attack the Sears Tower in Chicago.

Joe Conason, does this administration deserve the credit it has given itself?

JOE CONASON, “NEW YORK OBSERVER”:  Well, you know, Chris, they‘re going to get some credit because it was President Bush‘s watch.  But as you suggested at the top of the show, you can‘t start the clock when you choose if you‘re president.  The clock starts the day that you‘re inaugurated.  That was January 20th, 2001.  Nine months later almost, the country suffered the worst terrorist attack in post-World War II history, and they have to take a shared responsibility for that, as well.

All of the attacks that you just mentioned—I think there were six -

are actually pared down from a list they used to use of 10 supposed attacks that they thwarted.  None of these attacks, except for I guess one, are even alleged to have come from al Qaeda.  Very few of them, if any, were actually serious conspiracies that had reached an operational stage.  So it‘s a pretty thin list.

I think al Qaeda‘s ability to mount a serious attack against us was greatly diminished after we went after them in Afghanistan, which the president does deserve praise for.

MATTHEWS:  Well, Frank Gaffney, do you defend this administration‘s record in terms of protecting the United States from day one, or just since after 9/11?

FRANK GAFFNEY, CENTER FOR SECURITY POLICY:  Look, I would say, Chris, that the president deserves criticism for having continued the Clinton administration‘s policies in so many areas, intelligence, counterterrorism, homeland security, the wall, as they call it, between intelligence and law enforcement, that contributed, I think, to the fiasco, the disaster, the catastrophe, if you will, of 9/11.  So I would cite that as legitimate grounds for criticism.  I do I think the president...

(CROSSTALK)

MATTHEWS:  Excuse me, Frank...

GAFFNEY:  Hear me out, Chris.

MATTHEWS:  That‘s kind of a pissant...

(CROSSTALK)

GAFFNEY:  The president deserves credit!  Give him credit for what he is entitled to, Chris.

MATTHEWS:  But you‘re blaming...

GAFFNEY:  After 9/11, he learned from the mistakes that he made...

MATTHEWS:  ... Clinton for 9/11?

GAFFNEY:  I‘m sorry?

MATTHEWS:  You‘re blaming Clinton for 9/11?

GAFFNEY:  I‘m blaming the policy.

CONASON:  They‘ve been doing this for years, Chris.

GAFFNEY:  Look...

CONASON:  This is nonsense.

GAFFNEY:  It‘s an objective reality.

CONASON:  It is not an objective reality.

GAFFNEY:  The policies that was pursued by...

CONASON:  President Clinton tried to warn President Bush about this.

GAFFNEY:  Chris, may I have the floor?  May I have the floor just to respond to your question?

MATTHEWS:  Go ahead, Frank.  You‘re blaming Clinton for 9/11.  Go ahead.

GAFFNEY:  No, I‘m saying that the policies that were in place when this president took office, that he did not change for nine months, I think he deserves criticism for doing that.  I think the Clinton administration‘s policies for the previous period contributed to the whole series of attacks that we had, and I would argue contributed to the belief al Qaeda had that they could conduct the attacks of 9/11 with impunity.  But give him his due, after 9/11, for having learned from those mistakes and I think having made significant changes that have kept us safer.

MATTHEWS:  OK.  Let‘s take a look at what happened on 9/11, since we‘re back there.  The president‘s daily briefing on August 6th, 2001, said “bin Laden determined to strike in the U.S.”  Let‘s take a look at Richard Ben-Veniste questioning Condi Rice in the Iraq Study Group, questioning what she thought and how she reacted to that memo. 

(BEGIN VIDEO CLIP

CONDOLEEZZA RICE, SECRETARY OF STATE:  I remember very well that the president was aware that there were issues inside the United States.  He talked to people about this.  But I don‘t remember the al Qaeda cells as being something we were told we needed to do something about. 

RICHARD BEN-VENISTE, 9/11 COMMISSION:  Isn‘t it a fact, Dr. Rice, that the August 6th PDV warned against possible attacks in this country?  And I ask you whether you recall the title of that PDP. 

RICE:  I believe the title was “bin Laden determined to attack inside the United States.”  Now, the—

BEN-VENISTE:  Thank you. 

RICE:  No, Ben-Veniste. 

(END VIDEO CLIP)

MATTHEWS:  Frank Gaffney, your thoughts. 

GAFFNEY:  It makes the point I‘m trying to make.  I think the Bush administration was, I believe, inadequately steeled to the reality that those, in this particular case al Qaeda, but more generally who adhered to what the Islamists call sharia, were, in fact, intent on bringing their terrorist attacks to us in a highly, highly lethal way.  And I think the administration does deserve to be criticized for, as I say, having not changed course from the kinds of policies in this area that they inherited. 

But they did after 9/11 and I think that you just have to give them credit for that, too, Chris. 

MATTHEWS:  Yes.  Response? 

CONASON:  Well, look, President Clinton and Richard Clarke and other officials of the Clinton administration tried from before January 20th, 2001, as the transition was occurring to the new Bush administration, to warn President-Elect at that time Bush, Vice President-to-be Cheney, and other incoming officials of the grave, grave danger from al Qaeda. 

Why?  Because they had stopped several attacks on American soil that al Qaeda had planned, because they had a very robust anti-terrorist operation before the Bush administration began.  And, you know, the history on this is extremely clear. 

Frank is completely wrong about this.  The Bush administration ignored those warnings, not from August 6th, 2001, but from January 20th, 2001.  And the record is clear.  Paul O‘Neill made this point in his memoirs very clearly.  Richard Clarke has made this point.  This is the history that‘s going to be examined as this administration passes.  And the attempt to try to blame this on President Clinton are absurd.

MATTHEWS:  Look, I—who is going to win this battle?  Do you think, who is leaving office, will be blamed for 9/11, not preparing for it?  Do you think he will be blamed? 

GAFFNEY:  I think, as I have just suggested, he is entitled to be

blamed for some of this.  But he shouldn‘t be blamed for what the Clinton

administration didn‘t do before his, which led, among other things, to the

Cole disaster and the embassy bombings in Africa.  You can‘t honestly say,

Joe, that this was just a completely steel trap when there were serious

threats, serious terrorist attacks, there was a serious failure to go after

bin Laden on the Clinton administration‘s watch.  Look, the main point is -

-

CONASON:  That‘s false. 

GAFFNEY:  The reality is we are grateful.  We should be grateful, whether you are Democrats who hate George Bush or whether you are Republicans who love him, or whether you are a like a lot of other people who just are grateful to still be alive in this country, seven years after 9/11, without another serious attack.  And I think we ought to give the president his do.  And the fault, if you wish, but no with blinders on about what preceded it. 

MATTHEWS:  Speaking of responsibility, in today‘s “Washington Post,” Bob Woodward reports that the alleged 20th hijacker from 9/11 cannot be prosecuted.  He quotes Susan Crawford, the convening authority of military commission saying, quote, “we tortured Qahtani.  His treatment meant the legal definition of torture, and that‘s why I did not refer the case for prosecution.”

Frank, if we torture, I guess we get evidence.  That may be ends justifying the means.  But in that case we have admitted that the means were torture.  Do you think that is justified in the protection of this country? 

GAFFNEY:  I think there are circumstances in which it is justified, Chris.  I don‘t know if this is one of them. 

MATTHEWS:  Joe? 

CONASON:  Well, that at least was an honest answer.  We don‘t know whether the torture that has gradually been revealed ever brought forth any useful information.  And a lot of our military—experienced military leaders believe that torture is actually very much against the interests of the United States, almost never results in usable information, and should not be our policy, and that we lose moral authority every time we do it. 

GAFFNEY:  I think that‘s generally right and I think there are exceptions.  And I think most people on both sides of the aisle would agree that there are circumstances, ticking time bombs and the like, where you are going to use extreme measures.  I hope we don‘t have to run that gauntlet again. 

CONASON:  Unfortunately, we went much further than that. 

GAFFNEY:  Not in this case, I don‘t think.

MATTHEWS:  Joe Conason, Frank Gaffney, thanks for coming on.  Please come back again.  Up next, Barack Obama dined with some of his conservative critics, George F. Will, William Kristol, David Brooks and Charles Krauthammer.  Is this about keeping your friends close and your enemies closer?  I think that was a Godfather role.  This is HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  We are back now.  Time for the politics fix with MSNBC political analyst Pat Buchanan.  He‘s up in New York.  And “Chicago Tribune” columnist Clarence Page, who is right with me.  Pat, you weren‘t on that list the other night?  The president went to George Will‘s house, all these—well, these neo-cons were there, Kristol, Krauthammer, a mixed bag of conservatives, Peggy Noonan.  I figured out he had two “New York Times” reporters, two “Wall Street Journal” columnist, two “Washington Post” columnists. 

He had two from each of the big papers.  Then he had Lawrence Kudlow, who describes himself as a representative of the investor class, and Michael Barone, who is sort of a former liberal, now a conservative.  What do you make of that crowd, that he chose to dine with? 

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  I think the victorious was meeting the vanquished, quite frankly.  I think a lot of these fellows—first, you want to meet the president of the United States if you get the opportunity.  Very smart on Barack Obama‘s part.  What he‘s saying is, look, I understand you folks are my critics.  You are not my enemies.  I realize I‘m the president of all the people, and we have a country that‘s divided on issues.  You probably are on the other side.

We can be friends, social friends and we can talk.  Very smart on Obama‘s part.  On the part of the neo-conservatives—there were some conservatives there.  But the neo-conservatives have taking a horrendous beating, Chris.  I think their main projects have really been discredited.  Many of them have been discredited.  I think they want to get back in the great graces of the city. 

The neo-cons are not folks who really want to spend a long time out in the cold.  They‘re not revolutionaries.  They go with the party in power if they can get something.  That‘s their mind set.  If Barack Obama will give them something in foreign policy, I think they‘ll be very accommodating. 

MATTHEWS:  Are you saying they lack your audacity? 

BUCHANAN:  I‘m saying they‘re not conservatives.  They came to the conservative movement.  They all showed up outside of Ronald Reagan‘s transition office and said we‘re all fighting on another front. 

MATTHEWS:  I love it.  I love when people have their own fights.  The great thing about Pat Buchanan is he never leaves the fight.  Let me ask you, Clarence, I guess the way to get on somebody‘s party list is to say this—here‘s what Bill Kristol, who was at the party last night, had to say about Barack Obama—this is what got him on the dance card—“the more you learn about him, Barack Obama, the more Obama seems to be a conventionally opportunistic politician, impressively smart and disciplined, who has put together a good political career and a terrific presidential campaign.  But there‘s not that much audacity of hope there.  There‘s the calculation of ambition and the construction of artifice, mixed in with a dash of deceit, all covered over with the great conceit that this campaign and this candidate are different.” 

There‘s a way, completely undercut the guy, cut his legs off and then bring your plate up next to him and sit next to him. 

CLARENCE PAGE, “THE CHICAGO TRIBUNE”:  I was invited to the Clinton White House with some other pundits several time.  Never in eight years of the Bush administration, having been out in the wilderness now.  I‘m waiting for Obama, for heaven‘s sake, the home town guy here. 

MATTHEWS:  What do you make of this meeting with the enemy?  After the battle of Saratoga, the Brits and the Americans had dinner together, the officers did, of course.  Is this good—

PAGE:  He‘s looking good on—

MATTHEWS:  Who was the guy after the big riots in L.A. that said, “can‘t we all just get along?” 

PAGE:  Rodney King.  This is Obama saying no red state, no blue state, we‘re the United States of America.  I‘ll be more impressed when he brings in Sean Hannity and some of the other really rabid, not just critics, but assault dogs who go after him every night over on Fox.  Why does he meet with the neo-cons?  I‘ll wait for him to invite Pat over.  He‘s a nice guy. 

BUCHANAN:  Hey, Clarence—Clarence, don‘t feel bad you weren‘t invited to Bush‘s White House.  I wasn‘t either, Clarence. 

MATTHEWS:  Let us ask—let‘s get back to brass tacks.  If you get invited by the other side, Pat, that you don‘t agree with, to dinner and you have a couple of nice dinner, maybe see a movie—I once went to the White House with George Sr. and had a movie with my wife and my parents.  I was nice to the president for a couple weeks.  My father kept saying, don‘t trash that guy.  We just had dinner there. 

BUCHANAN:  Chris, you are very right. 

MATTHEWS:  Statute of limitations.  How long are you nice to a guy? 

BUCHANAN:  You‘re exactly right.  Listen, I went to George Bush Sr.‘s

place as well as you did.  And, look, what this does is, you come and say -

look, Barack Obama is a charming man.  He doesn‘t have a mean streak in him that I can find.  He‘s gracious.  He‘s got a sense of humor.  You sit down, have dinner with him and wise crack back and forth.  And you walk away and you‘re sitting down angry about something, you start writing; you say, I can‘t write that about the guy.  He‘s a nice guy.  I‘ve done it as a young editorial writer, Chris.  I met a guy I—

MATTHEWS:  OK, we will have to come right back.  I want to find out—

I want Clarence to answer this and I‘ll answer it.  How long does it take for you to get over it?  Forget you had dinner with the guy, go back to your typewriter and write the truth. 

If you can‘t peel the bark off somebody at the typewriter, why have the job?  We‘ll be right back with Pat Buchanan and Clarence Page to answer that question: how long does good will last?  You‘re watching HARDBALL.  Or a good meal?  We‘ll be right back on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with Pat Buchanan and Clarence Page.  We‘re talking about these wonderful evenings of civility, where Washington lets down its guard.  Pat Buchanan, just to admit my situation, I was invited by President Bush Sr., the first president, to come to dinner for a movie.  I forgot who was in the movie.  We saw the movie with my parents there.  I was—my father‘s best night of his whole night, he told me.  It was the greatest thrill of his life to be at the White House.  I think these things are powerful. 

Let me ask you about this McCain dinner.  It‘s coming up Monday night.  In a rare case of true chivalry, Barack Obama, the winner, is holding a dinner in honor of John McCain, who he bested in the campaign, a dinner in his honor at the Washington Hilton, where Ronald Reagan, of course, was shot.  That‘s how it‘s known by so many people in Washington, that dinner - - that hotel. 

What do you make of that evening?  I think that‘s going to be a very nice, smart, American night. 

BUCHANAN:  Well, I‘d use just two words to describe it: class act.  That is an extraordinary gracious gesture the evening before he is inaugurated.  It is intelligence.  It is smart.  It speaks enormously well to the president-elect.  Simply, Chris, you don‘t have to be invited to the White House.  I see myself seeing him reach out and doing this—it says, look, I‘m going to be true to my word.  I said I‘m going to reach out to these guys, my critics and opponents, and I‘m doing it.  So you‘ve got to admire that.  Frankly, that is disarming for people like myself who are likely to be fairly severe critics of a lot of what he does. 

PAGE:  This will to help to elevate his stature as well.  It puts him in the context of other leaders.  This is like his inviting all the living ex-presidents to the Oval Office. 

MATTHEWS:  Magnanimity, one of the great human traits.  Thank you, Pat Buchanan.  Thank you, Clarence Page.  right now, it‘s time for “1600 PENNSYLVANIA AVENUE” with David Shuster.

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

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