updated 1/20/2009 1:50:08 PM ET 2009-01-20T18:50:08

Guest: Joan Walsh, Jonathan Martin, Chris Cillizza, Ron Brownstein, Tony Blankley, Tom Andrews, Roland Burris High: Most loyalists to President Bush hope his legacy will change with the passage of decades and possible changes in the future of the Middle East. When Obama takes office, he‘ll have to balance his stimulus spending with a commitment to deficit reduction.  What will George W. Bush‘s legacy be from the wars in Iraq and Afghanistan? Barack Obama prepares for his inauguration next week.  Illinois Senator Roland Burris discusses how he because a U.S. senator.  President Bush says goodbye to the nation.  Spec: Roland Burris; Illinois; Rod Blagojevich; Senate; Barack Obama;

George W. Bush; Politics; Democratic Party; Politics; Economy; War; Iraq;

George W. Bush

CHRIS MATTHEWS, HOST:  Obama mania.  Let the excitement begin. 

Let‘s play HARDBALL. 

Good evening.  I‘m Chris Matthews. 

Leading off tonight, sunrise, sunset.  So much is happening here in Washington this week, lots of street noise, lots of buzz about parties and balls and which Hollywood people are going to be where.  But it‘s really the story not of who‘s coming for the inauguration, but who‘s really coming to lead this country and who‘s going. 

Now hear this.  President-elect Barack Hussein Obama coming in on the train from Philadelphia Saturday.  George Bush will be leaving Wednesday.  Actually, he will be leaving Tuesday on that big plane no longer called Air Force One, at least not for this trip, down to Texas, where he promises to make coffee the next morning for the former first lady.  That, at least, is a smart political move. 

But guess who‘s already come to town?  That fellow who arrived under the umbrellas last week, stood there in the rain trying to get in the door, and is now as full-fledged as a United States senator as Ted Kennedy himself.

Senator Burris is sitting right here in front of me, Senator Roland Burris of Illinois.  And he will be on in just a minute.

Also tonight, Obama in Ohio today says the economy will get worse before it gets better. 

(BEGIN VIDEO CLIP)

BARACK OBAMA (D-IL), PRESIDENT-ELECT:  Recovery is not going to happen overnight.  It is likely that, even with the reinvestment package that we‘re putting forward, even with the measures that we are taking, things could get worse before they get better. 

(END VIDEO CLIP)

MATTHEWS:  But how much time, political time, does he have to turn things around?  Big question. 

And let‘s not forget those two wars our country and our people are fighting over there in Afghanistan and Iraq—one last debate tonight in Bush time on why we‘re fighting. 

In politics tonight, the whole shebang.  Barack is coming to fix the economy, to win and end or end the wars.  Bush is leaving to make coffee, cut brush, preach democracy, whatever.  Does he know that he, George Bush, more than anyone else, is responsible for the rebirth of the Democratic Party and the burial of the Republican Party? 

And guess what?  We have got a new HARDBALL Award winner tonight.  And I think you know who it is.  Boy, do you want this guy in charge when the situation gets scary—that and a look back at some of the best lines in inaugural address history tonight.  Here‘s a taste. 

(BEGIN VIDEO CLIP)

RONALD REAGAN, PRESIDENT OF THE UNITED STATES:  Government is not the solution to our problem.  Government is the problem. 

(END VIDEO CLIP)

MATTHEWS:  Well, we will see what that means right now.  I think government‘s the solution right now.

But, first, it‘s my great honor to welcome U.S. Senator Roland Burris. 

Sir, it is an honor. 

SEN. ROLAND BURRIS (D), ILLINOIS:  It‘s my pleasure. 

MATTHEWS:  We have—we have watched your march to town. 

(LAUGHTER)

MATTHEWS:  When did you know, sir, that you knew you had beaten the system, that you were going to be a United States senator, no matter what anyone thought in the Senate Democratic leadership, no matter what the press thought or anyone else? 

BURRIS:  I think it was Monday, Chris. 

I got a call from Senator Durbin indicating that he had the documents, and he thought that the lawyers were going to OK them.  There was the secretary of state‘s signature on the document, with the state seal.  And all he had to was attach that to the appointment.  And that then caused us to comply with rule two, which made me then eligible for the seat. 

MATTHEWS:  Why did that Jesse White, the same name as the Maytag man, I remember...

(LAUGHTER)

MATTHEWS:  ... why did he finally change his mind and said, I will sign up and make it official that you are a senator? 

BURRIS:  Well, no, that—that was the Illinois Supreme Court decision.  Once the Supreme Court issued its order that he didn‘t have to sign, but it says, all you have to do, then, is go and asked for a certified copy of the document that he was required to put his signature and seal on.  So, we asked for a certified copy.  I think we paid 10 bucks for it.  And then that took care of the problem. 

(LAUGHTER)

MATTHEWS:  What is he like, a notary public, this guy?

BURRIS:  Well, no.

(CROSSTALK)

MATTHEWS:  If you‘re secretary of state of a state, when you have to sign something, do you have to sign it like you‘re told to sign it, like in “The Godfather?”  Your brains or your signature are going to be on that—that paper? 

BURRIS:  Well, in order to enroll and endorse all documents, then he‘s supposed to sign them.  But there is now law that said he has to sign.

MATTHEWS:  Right. 

BURRIS:  And this is what the Illinois Supreme Court ruled, said whatever the governor signed is the law.  And the Illinois Supreme Court ruled that Roland Burris‘ appointment is legal. 

MATTHEWS:  OK. 

Let me ask you about Governor Blagojevich. 

BURRIS:  Yes. 

MATTHEWS:  Is he going to have a place to hang his hat when he comes to Washington?  Will you make his office—your office available to him as a place to sort of hang out when he comes to D.C.? 

BURRIS:  Well, Governor Blagojevich...

(LAUGHTER)

BURRIS:  ... has a few problems.  And I think he must get over the impeachment process, which will start very shortly in the Illinois Senate. 

And then, of course, he has to then have his trial.  And, remember, Chris, as a former attorney general, you‘re innocent until you‘re proven guilty in this system. 

MATTHEWS:  Do you believe he‘s innocent? 

BURRIS:  I don‘t know—that‘s not—that‘s not for me to believe.  Based on what I heard, I will not prejudge what the evidence—the information that‘s come forward.  I will not prejudge that. 

MATTHEWS:  Were you surprised when, after all the—all the talk and evidence, perhaps—you could call it evidence because it was in the U.S.  attorney‘s complaint—of how he was trying to deal that job, he was trying to make something out of it, the—the seat that you‘re now filling, that he didn‘t ask you for anything, he just gave you the seat; he said, I‘m going to give this because of your record, and you‘re the right person for this job, that he never said, hey, I want some help on fund-raising or something like that? 

(CROSSTALK)

BURRIS:  Well, I never talked to the governor, other than the time that he offered me the appointment.

MATTHEWS:  But he never said, here‘s the deal? 

BURRIS:  Absolutely not, no.  He saw nothing from me. 

As a matter of fact, if he is—his behavior, if what the indictment

I‘m sorry—I mean, the charges are stating, if those are proved to be true, those actions are reprehensible. 

MATTHEWS:  Yes. 

BURRIS:  You cannot sell a United States Senate seat. 

MATTHEWS:  Do you think that‘s a crime? 

BURRIS:  I‘m pretty sure there‘s federal laws against that. 

MATTHEWS:  Yes. 

BURRIS:  I mean, there‘s something—but that‘s what they‘re going to have to prove.

And we must remember, now, we cannot convict him in the press or convict him in the court of public opinion. 

MATTHEWS:  Do you think he‘s guilty of a crime by simply sitting in an office, plotting something with his staff guy?  Is that a crime, sitting there talking about it, and having it recorded, before you—if he doesn‘t make a deal with anybody, if he doesn‘t cut a deal with anybody, is it a crime just to think about it? 

(CROSSTALK)

BURRIS:  Well, there—no, you have to take some type of action. 

It‘s called a conspiracy. 

MATTHEWS:  Right.  That‘s what I thought.

BURRIS:  So, unless you move to make some type of act or step to carry out the crime, but you don‘t complete the crime, then you have a possible charge for conspiracy. 

MATTHEWS:  So, it is possible he can get off? 

BURRIS:  Well, that‘s what really I‘m saying.  We must be, you know, very careful about convicting someone before he‘s gone through our system of a trial by jury or a trial, you know, by a judge. 

MATTHEWS:  OK.  Let me ask you about your political call.  Have you decided to run for election as a senator yet? 

(LAUGHTER)

MATTHEWS:  Have you decided?

BURRIS:  Chris, I‘m trying to get my Senate legs under me.  I have been reading rules, and trying to get staff together, and trying to figure out how we‘re going to handle all these expenses that have come out of my pocket, because...

MATTHEWS:  Really?

BURRIS:  ... because we had to advance all this money, all the staff that was out here.  I had to put all that up front.  And then now...

(CROSSTALK)

MATTHEWS:  You have to pay Kurt Schmoke out of your own money?. 

BURRIS:  Well, no, no, now, that was my (INAUDIBLE) and that was volunteer. 

But, yes, you cannot have any type of voluntarily legal services, because then that‘s an illegal contribution. 

MATTHEWS:  Right. 

BURRIS:  So, they have to give me a bill.  I will have legal bills, substantial legal bills, because I had one lawyer working on this for about three weeks. 

MATTHEWS:  Do you like living in a job where you can‘t even have

somebody buy you a hamburger?  I mean, that is what it‘s like being a

senator these days.  There are so many rules involved with ethics that it‘s

you‘re being watched.  You know this. 

BURRIS:  And, Chris, you know that that would not have come about if somebody hadn‘t screwed up earlier.

And those rules and regulations come to try to protect the taxpayers and keep those politicians who would be dishonest to try to halfway keep them honest. 

MATTHEWS:  Let‘s talk about the big picture of next Tuesday.  In this city well, I don‘t think there‘s ever been—well, there was certainly was the inauguration of Lincoln and Roosevelt and I guess you could throw in Kennedy and Reagan.  This is one of the big ones. 

What does it mean to you? 

(CROSSTALK)

BURRIS:  It is so personal to me, Chris, you will never, ever know. 

I mean, I have been to a lot of inaugurations.  I was at Senator Kennedy‘s inauguration when I was a law student out here in 1960 at Howard.  And I went to Carter‘s inauguration and Clinton‘s inaugurations. 

But I never did dream, number one, that I would to go to the inauguration of an African-American president, never did dream that I would know that president personally, and never did dream that he would come from the great state of Illinois.  My state is great. 

MATTHEWS:  Did you see Obama coming up?  Did you see it...

BURRIS:  I saw...

(CROSSTALK)

MATTHEWS:  ... this bug he had, this amazing—not bug—this amazing charisma?

BURRIS:  You know what I was talking to Obama about when he ran for Congress our 1st Congressional District congressman, Bobby Rush?  I was upset with him.  I said, why you are going that?  You‘re going to ruin your political career.  You have a bright career. 

You—no, I was—I was just—I had run for governor, and I lost, I think.  I said, you can be attorney general and then go and be governor of Illinois.  Barack, why are you doing it? 

And he said, well, Roland, I have to do what I have got to do. 

So, I backed away from it, and he lost that race.  But then he comes in a few years later and come back and run for the Senate.  And, of course, that gentleman must be—something must be—what do you say, the stars are lining up for him?

MATTHEWS:  Well, he is lucky, because if he got to be the congressman from the South Side of Chicago, he would have had to be somewhere on the left politically to represent that district, and he would have never won statewide. 

BURRIS:  Yes.  Well, that‘s also a problem.

And guess what, though.  You ever seen a candidate who come up with—in a primary, there was a gentleman who had a sealed divorce, and that got him in trouble, and the Republican nominee had a sealed divorce, and he had to get out of the race?  I mean...

(LAUGHTER)

MATTHEWS:  And along came Alan Keyes. 

BURRIS:  And along came the guy from Maryland, which was—which was a—I mean, I guess he‘s an educated man, but he was a sideshow coming to Illinois in that fashion, and carrying on.  It was an embarrassment.

(CROSSTALK)

MATTHEWS:  How long is this luck going to hold? 

BURRIS:  Well, it‘s going to hold greatly, because he is going to do great things for America. 

I‘m confident that Obama will be able to bring us out of this mess in

his first term.  And you will see the economy being turned around.  And 20

20 -- what is it, 2012?  And we will be then on in his second term and see the prosperous America that Bill Clinton gave us in the ‘90s will also be Obama in the early ‘20s. 

MATTHEWS:  Senator, will you hold on for one minute?  I would like to have you here while we do this.  We have a ceremony here. 

Last Friday, we gave the first ever HARDBALL Award to a person who showed the moxie, the street smarts to make the most of a tricky situation, the man before me, the honorable Roland Burris of the state of Illinois, who‘s now the United States senator from Illinois. 

I thought we wouldn‘t have another winner for some time.  Then, suddenly, yesterday, we were struck with another undeniably worthy HARDBALL awardee, Chelsey Sullenberger, the pilot who decided in a moment of life-and-death crisis on the one course that would save his passengers, and his crew and prevent harming or endangering others. 

Ernest Hemingway called courage grace under pressure.  What an example you gave us, Sully, veteran pilot, savior of 155 lives, man of courage, hero to America and the world, HARDBALL Award winner. 

Coming up:  Barack Obama, now just four days away from the presidency, warns, the economy may get much worse before it gets better. 

And, don‘t forget, tomorrow, Barack Obama and Joe Biden arrive in Washington aboard a train from Philadelphia.  We will have full coverage all day.  And join me for three hours of it between 5:00 and 8:00 Eastern for a special much-expanded edition of HARDBALL. 

You‘re watching it, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Coming up:  President Bush was a wartime president, but did his two wars help make America stronger and safer?  Did it make America prouder?  We will debate that later—and coming up, actually—right here on HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.

Barack Obama took his economic recovery plan on the road to Ohio today, and talked up his top priority. 

(BEGIN VIDEO CLIP)

OBAMA:  The way I see it, the first job of my administration is to put people back to work and get our economy moving again. 

(END VIDEO CLIP)

MATTHEWS:  But he also warned that the economy will likely get worse before it gets better.  How will a stimulus package actually set the tone for his first year in office?  That‘s the big question.  And how long will the public give him to steer us out this recession, which could be called a depression at some point?

Ron Brownstein is with the Atlantic Media and Chris Cillizza is with thewashingtonpost.com.

Ron and Chris, it seems to me that, at some point, we may have a language question.  Half-a-million jobs a month disappearing, at that rate, I figure we are up to 15 million unemployed by late summer.  That gets into the old 1930s situation. 

Ron? 

RON BROWNSTEIN, POLITICAL DIRECTOR, ATLANTIC MEDIA:  One of the things that we don‘t know is where the bottom is here.

The stock market, the job market, all of these indicators, it is an unnerving point for many Americans.  And, in many ways, you know, for all of the assets that Obama has coming into office, in some ways, that may be the most formidable, which is the fear that, if we don‘t act dramatically, we could be facing consequences of the sort we haven‘t seen since the 1930s.

And that is something that I think that really is in the minds of members of Congress, who are reluctant to not move as dramatically as they can against a problem that—that just keeps—seems—seems to keep getting bigger. 

MATTHEWS:  Depth and duration.  We don‘t know how deep it will go or how long it will last.  There‘s an assumption—a lot of people have built-in optimism it will be like the Reagan recession, very deep, very quick.  It could be very deep, very long. 

CHRIS CILLIZZA, “THE WASHINGTON POST”:  And I think, just to piggyback on Ron‘s point, listen to president-elect Obama‘s rhetoric when he talks about the economy.  It‘s going to get worse before it gets better. 

We had an interview with him yesterday in which he said, 2009 could be a very tough year. 

I think there is—he doesn‘t know where the bottom is.  He said, I don‘t have a crystal ball. 

He—he thinks this economic recovery package is the right way thing to do.  He has been told that.  But the truth of the matter is, Chris, he doesn‘t know.  No one really knows.  And, so, I think he‘s insulating himself, at least rhetorically, from, if this does get worse, that he can say, look, we knew it was bad when we got in.  It was worse than even we thought.  We‘re trying to do things to make it better, but this is not going to be an easy time.  There is no—if there was a quick fix, we would have already done it. 

MATTHEWS:  You have got a hundred—hundreds of thousands of people out there working on construction gangs, basically.  That‘s what we‘re talking about, building bridges, fixing roads, shovel-ready projects, right out in front of us. 

(CROSSTALK)

MATTHEWS:  Is that going to—is that going to push the economy, this gigantic $13 trillion economy, into action, when it‘s deflating right now? 

BROWNSTEIN:  That‘s only one relatively small piece of it. 

I mean, the thing about this that is really so striking is the breadth of it.  When you look at this package and you look at what—specifically what the Democrats put out yesterday in the House, you have an amazing amount of money going into an incredibly panoramic array of Democratic priorities. 

There are things like infrastructure, which are designed solely to try to put people to work in the near term.  There‘s also enormous sums in this bill for  traditional Democratic priorities that they think are the key to long-term economic prosperity. 

MATTHEWS:  Like what? 

BROWNSTEIN:  Like $13 billion for expanding Title I to poor schools.  Bill Clinton spent six years trying to get the Republican Congress to agree to a school construction program.  Never got to it.  There‘s $14 billion in there.

There‘s $16 billion in here for Pell Grants, $10 billion in here for scientific research, $2 billion for advanced batteries, as well as the things like incentives for alternative energy, money for building the electrical grid, so that we can reach out to wind and solar power and those kind of things.

So, really, the opportunity for Obama here, Chris, is that he is going to get a chance, with this bill, to really redirect the federal government in a profound way, to a much greater extent than Bill Clinton was able to do when he came in, in 1993.  He—he was fighting for $50 billion or $75 billion in investment.  Obama is talking about 10 -- up to as much as eight, 10 times that. 

So, this is really going to put a big imprint on the government and allow him to move forward on a lot of different fronts.  And the separate issue, of course, is whether it‘s enough to deal with the economy.  I don‘t know the answer to that.  I do know it is going to give him a big chance to redirect federal priorities. 

CILLIZZA:  Out of—you know, look, out of big crisis comes big opportunity. 

There‘s no question about that, from a political perspective.  And I think that‘s what Barack Obama sees.  He knows that inaction is not an option.  So, I think what he is doing is saying, look, I‘m being told that, the bigger we go, the better we go.  We‘re not sure exactly how this thing is going to end up.

But there‘s clearly an attempt here to institute priorities early on in a way that other presidents have not had the luxury of doing.  You know, Bill Clinton, the reality, he gets in, he‘s not able in fact to do the things he wanted to do because of the budget deficit. 

Barack Obama recognizes, is this difficult?  Yes, it‘s absolutely difficult.  You wouldn‘t want to take over at a time like this if you had thank our ideal situation.  But he sees opportunity in it to reshape the way the government works. 

BROWNSTEIN:  The flip side of that, though, is he is putting down a lot of the—of his chips on this initial package. 

I mean, you are going to have federal deficits after this that we really have never really seen in dollar terms, and even as a share of GDP, that we haven‘t seen World War II.  And that means, I think, there‘s going to be a lot pressure from more moderate to centrist Democrats and moderate Republicans on deficit reduction going forward, which means that, as he comes to health care—he wants to provide universal health care—the starting cost of that is $100 billion a year, growing to $200 billion a year.

He wants to significantly provide incentives for alternative energy.  After this, there‘s going to be a lot of pressure, I think, from the center-right of his party to focus on deficit reduction.  They don‘t want to go back home in 2010 with a trillion-dollar deficit and no plan to bring it under control.

And I think that is one of the reasons politically you hear him talking about a grand bargain, where he tackles entitlements, where you have Rahm Emanuel talking about a deadly serious spending reform, because, ultimately, if they‘re putting this much in spending and tax cuts, they‘re going to have to find some way to balance it on the other side of the ledger with some kinds of spending restraints, or else I think they‘re going to face a lot of concern among the members from more moderate to swing districts.

MATTHEWS:  But they‘re doing all this without any committee reports, any mark-ups.  They‘re just writing this Christmas list and filling Santa Claus‘s bag with it and spending the money without any check on the quality of these programs, the efficiency of the money that‘s being spent.  Isn‘t that a little scary?

CILLIZZA:  I think it‘s more than a little scary politically.  The way that it is being, I think, cast is, Desperate times call for desperate measures, that we are in a situation unique in American history, at least modern American history, and we‘re therefore going to have to act in that way.

But yes, to Ron‘s point, in 2010, I think, if you see a massive federal deficit, if you see Republicans starting to rally around the idea of, Well, we need to tighten our belts, we can‘t just spend ourselves—

Barack Obama is nothing but a big-government liberal—they‘ve scored successfully with that attack in the past.  A lot of Republicans after the 2008 election said, That‘s the core thing we need to get back to.

MATTHEWS:  Amazing conversation.  Thank you, Ron Brownstein.  Thank you, Chris Cillizza.

Up next: In four days, Barack Obama takes the oath of office and delivers his eagerly awaited inaugural address.  When we return, great moments in past inaugural speeches.  We‘re going to have the bites.  They‘re fascinating to hear, if you love history, all the way back—well, from Truman to Bush, all the TV tape we‘ve got.

You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Back to HARDBALL.  Inaugural addresses are the opportunity for the president to set the tone for the coming era, to tell you how they‘re going to truly make things different.  Here‘s a look back at some of the notable inaugural lines we‘ve heard through the years.

(BEGIN VIDEO CLIP)

HARRY S. TRUMAN, PRESIDENT OF THE UNITED STATES:  The supreme need of our time is to for men to learn to live together in peace and harmony.

DWIGHT DAVID EISENHOWER, PRESIDENT OF THE UNITED STATES:  We sense with all our faculties that forces of good and evil are masked and armed and opposed as rarely before in history.

JOHN F. KENNEDY, PRESIDENT OF THE UNITED STATES:  So my fellow Americans, ask not what your country can do for you, ask what you can do for your country.

LYNDON BAINES JOHNSON, PRESIDENT OF THE UNITED STATES:  I do not believe that the great society is the ordered, changeless and sterile battalion of the ants.  It is the excitement of becoming, always becoming, trying, probing, falling, resting and trying again.

RICHARD MILHAUS NIXON, PRESIDENT OF THE UNITED STATES:  If we succeed, generations to come will say of us now living that we mastered our moment, that we helped make the world safe for mankind.  This is our summons to greatness.

JIMMY CARTER, PRESIDENT OF THE UNITED STATES:  We will move this year a step toward our ultimate goal, the elimination of all nuclear weapons from this earth.

RONALD WILSON REAGAN, PRESIDENT OF THE UNITED STATES:  Government is not the solution to our problem, government is the problem.

GEORGE H.W. BUSH, PRESIDENT OF THE UNITED STATES:  We as a people have such a purpose today.  It is to make kinder the face of the nation and gentler the face of the world.

WILLIAM JEFFERSON CLINTON, PRESIDENT OF THE UNITED STATES:  Though we march to the music of our time, our mission is timeless.  Each generation of Americans must define what it means to be an American.

GEORGE WALKER BUSH, PRESIDENT OF THE UNITED STATES:  The survival of liberty in our land increasingly depends on the success of liberty in other lands.  The best hope for peace in our world is the expansion of freedom in all the world.

(END VIDEO CLIP)

MATTHEWS:  Not much, was it?  Anyway, four days from now, Barack Obama will add his own historic words, and they‘re going to be better than these, I can bet that right now.  But they‘ll be added to our national memory starting next Tuesday.

Up next: When Barack Obama takes over, he‘ll inherit two wars.  When we return, we‘ll have one last Bush-era look at Bush‘s decision to invade Afghanistan and Iraq.

This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

(CNBC MARKET WRAP)

MATTHEWS:  Welcome back to HARDBALL.  Among the biggest problems Barack Obama inherits on Tuesday is the U.S. involvement in two wars.  All this week, we‘re looking at George W. Bush‘s legacy, and the wars in Iraq and Afghanistan are perhaps the most divisive aspects of that legacy.  The death toll among U.S. military in Iraq is over 4,000, over 600 in Afghanistan.  By the way, an estimated 100,000 Iraqis have been killed in this war since the invasion in 2003.

Tom Andrews is the national director of Win Without War and Tony Blankley‘s a conservative—well, he‘s just a conservative.  He‘s also a syndicated columnist and author of the new book, “American Grit.”  I should get that book.  You should come on and talk about that book.

Here‘s President Bush last night on the reason for us going to war in Iraq.

(BEGIN VIDEO CLIP)

BUSH:  The battles waged by our troops are part of a broader struggle between two dramatically different systems.  Under one, a small band of fanatics demands total obedience to an oppressive ideology, condemns women to subservience and marks unbelievers for murder.  The other system is based on the conviction that freedom is the universal gift of almighty God and that liberty and justice light the path to peace.  And in the long run, advancing this belief is the only practical way to protect our citizens.  When people live in freedom, they do not willingly choose leaders who pursue campaigns of terror.

(END VIDEO CLIP)

MATTHEWS:  Tony, is this why we went to war in Iraq?

TONY BLANKLEY, SYNDICATED COLUMNIST:  Well, look, as you know, there were a lot of reasons that Bush mentioned—weapons of mass destruction.  He gave the speech at AEI on democracy.  I think most of the public thought we went because of weapons of mass destruction, not to do democracy, although he did list all of those reasons.

MATTHEWS:  Well, let‘s take a look before (INAUDIBLE) Let‘s take a look.  Here‘s President Bush laying out the case for war back in 2002.

(BEGIN VIDEO CLIP)

BUSH:  Some ask how urgent this danger is to America and the world.  The danger is already significant, and it only grows worse with time.  If we know Saddam Hussein has dangerous weapons today—and we do—does it make any sense for the world to wait to confront him as he grows even stronger and develops even more dangerous weapons?

(END VIDEO CLIP)

MATTHEWS:  And here the president is in the final press conference this week, talking about that WMD issue in Iraq.

(BEGIN VIDEO CLIP)

BUSH:  There have been disappointments.  Abu Ghraib obviously was a huge disappointment in the presidency.  Not having the weapons of mass destruction was a significant disappointment.  I don‘t know if you want to call those mistakes or not, but they were things didn‘t go according to plan, let‘s put it that way.

(END VIDEO CLIP)

MATTHEWS:  What do you make of that, Tom?

TOM ANDREWS (D-ME), FMR. U.S. CONGRESSMAN, DIR., WIN WITHOUT WAR:  You know, the irony here, the bitter irony, Chris, is the very principles and values that the president said that he was defending and promoting in this war he subverted systematically.  He deceived the American public.  This was not just a matter of bad intelligence.  There was an operation within the White House called the White House Iraq group that was designed to systematically take bits of information, manipulate them, poll the American people, find out what was going to scare the American people the most, and then feed them what the White House knew to be untrue information that would lead the American people into believing that an attack was fully justified.

MATTHEWS:  Why?

ANDREWS:  Why?  Because the...

MATTHEWS:  Why‘d they do it?

ANDREWS:  Why?  Because you had a group of people that the administration basically gave the steering wheel of the White House and the country to, called these neo-cons, who had a preordained power agenda that they wanted to fulfill, and they saw 9/11 as a vehicle to put that plan into effect.  It was a radical plan.  It was nonsensical.  It was outrageous.  But they saw it as an opportunity to do it, and of course, the president just gave them the wheel.

MATTHEWS:  Well, I found it interesting that the president, who admitted he was wrong about WMD as a justification for war, called it a “disappointment.”  If a police officer in the line of duty in the middle of the night shoots a fellow because he thinks he‘s got a gun and it turns out he‘s got a wallet, your reaction, if you‘re a police officer, is not that you‘re disappointed he didn‘t have a gun, it‘s shame that even if it was a technical mistake you made, that you killed a guy without reason.

Why‘s the president used the word disappointment when he says they didn‘t have the WMD to justify this going in?  I think it‘s an odd use of the word.

BLANKLEY:  It is, but I think as you know...

MATTHEWS:  It is.

BLANKLEY:  I think every politician knows that there‘s a gotcha game if you admit mistakes.  Now, I think he‘s got to the point where he can probably do it because he‘s out of office in five days.  But if you say, I made a mistake, then that becomes the headline.

I do want to just briefly contest one of many of your points, that the president knowingly misstated facts to the public.  Clearly, the facts were mistaken, but there‘s a difference between mistaken and intentionally doing a lie.  I don‘t...

(CROSSTALK)

BLANKLEY:  It‘s an old—it‘s an old debate, but...

ANDREWS:  No, this is important because he‘s trying to recreate history here.  He quoted a U.N. report that never existed.  He quoted a defector who said absolutely the opposite of what he actually said.  One of my...

MATTHEWS:  What about the 16 words...

ANDREWS:  The 16 words...

MATTHEWS:  ... about the nuclear arms, nuclear purchases out of Africa?

(CROSSTALK)

ANDREWS:  Hold on.  Wait a minute.  My favorite...

BLANKLEY:  I mean, this is old debate, but I mean, in fact, the British continue to believe in the yellowcake there, right?

ANDREWS:  Listen, my favorite was he told the American public that Saddam Hussein had the capability of taking a drone, putting biological weapons onto it and flying it, launching it off the East Coast and flying down the coast, killing millions of Americans.

MATTHEWS:  Right.  I remember the story.

ANDREWS:  Now, he had in his possession—we now know he had in his possession a U.S. Air Force report that documented that that was completely impossible.  He had no such capability, nor would he have such capability.

BLANKLEY:  Well, I‘ll...

ANDREWS:  But he went on the air telling the American people something he knew...

(CROSSTALK)

MATTHEWS:  Why did he build this picture in our minds of some balsawood plane coming from Iraq carrying even in one case nuclear weapons?  Why did he build that picture in our minds, so that the American people thought that Saddam Hussein was a strategic threat to the United States?

BLANKLEY:  Let me—let me say...

MATTHEWS:  Why did he do it?  If he did it by accident, why did he do it?

BLANKLEY:  We‘re talking about the legacy of the war, and we‘re now like debating causes and arguments for it, rather than effects of it.

MATTHEWS:  How about reasons for it?

BLANKLEY:  No, let me—let me (INAUDIBLE) The Civil War was fought not to end slavery but it was fought to save the union.  It‘s a fact.  Its legacy was to free the slaves.  I think it‘s an interesting discussion to revamp over and over again all the things that were said five years ago...

MATTHEWS:  The war was fought over expansion of slavery into the territories.  At least it fought over slavery.

BLANKLEY:  Right.  But the question—the question of the legacy is, Are we going to better off 5, 10, 20 years from now for this war or not?  I think that‘s an open debate, but it‘s a more interesting one than haggling over whether George Bush was given some false information, you know, six years ago.

ANDREWS:  Should a president of the United States...

BLANKLEY:  Five years ago.

ANDREWS:  Should a president of the United States lie to the American people?

BLANKLEY:  No.

ANDREWS:  Should a president of the United States engage in the systematic...

BLANKLEY:  You know...

ANDREWS:  ... deception of the American people...

(CROSSTALK)

MATTHEWS:  ... of your morality here?  If a cop shoots a guy by accident because he thinks he‘s armed, which is a good metaphor for this.  You think the bad guy‘s armed.  And you say, Well, even if he wasn‘t armed, at least he never got to shoot anybody again, so it‘s justified 10 years later.

BLANKLEY:  No, that‘s not the point.

MATTHEWS:  That‘s an incredible moral argument.

BLANKLEY:  No, it‘s not, and I‘m not making that argument.  We are supposed to be discussing the legacy, the consequences of the Bush presidency.  And the consequences of the Bush presidency will be defined centrally by whether the Iraq war ends up being good for America or bad for America.  We haven‘t had that debate...

MATTHEWS:  How would you judge it positively?  How would it turn out?

BLANKLEY:  Well, if—if—and we don‘t know yet.  The story hasn‘t...

MATTHEWS:  Tell me how it would look.

BLANKLEY:  If, in fact, Iraq ends up being a benign, non-radical at least neutral or friendly to the West country, and that ends up reducing radicalism and tyranny in the Middle East, then probably, fighting the war 50 years from now will look like a good decision.  If, on the other hand, as could still be the case, you have Sunnis and Shias fighting and they suck the other countries in and we have a holocaust of fighting in the Middle East, it‘ll be a disaster.  That‘s the interesting question.  Which way does it go?

MATTHEWS:  All those British wars in the Middle East that were propping up monarchies in the British model, if it turned out that those monarchies had lasted in Iraq and Syria and places like that, then the British empire would have been justified?  Well, that‘s what you‘re arguing. 

BLANKLEY:  I think the British Empire was justified.  I think India benefited.  It‘s a better country because they have traditions of democracy and the commonwealth.  Do you think India‘s better off than—

MATTHEWS:  I‘m talking about the Middle East. 

BLANKLEY:  Nothing lasts forever, but I think that you can make an argument—

MATTHEWS:  Do you think there‘s a good bet that Iraq is going to turn out to be a stable democracy?  That‘s a good bet?  Tony, for a second.  Is it good bet that it‘s worth 100,000 dead Iraqis? 

BLANKLEY:  I would bet at about 50/50.  And if that‘s the case, and if history unfolds and the Mideast becomes more benign because of that—we could have a nuclear war out of the Middle East, you know, at any point, as you know, with the weapons building up.  So if that resulted that way, then it was a bet worth making.

MATTHEWS:  Can I give you another case?  It‘s your argument, I‘m sorry.  But if we had left Iraq in place and they had been a buffer to Iran, Israel would not be threatened by an unchecked Iran right now. 

BLANKLEY:  No.  Because Iranian missiles can fly over Iraq. 

MATTHEWS:  But Iraq was a buffer and a challenge to Iran.

(CROSS TALK) 

MATTHEWS:  We removed the biggest threat to Iran, Iraq. 

BLANKLEY:  Wait a second.  We don‘t know how this story is going to play out yet.  If Iran doesn‘t develop—I think mostly liberals argue that Iran is not a country that‘s impossible of being integrated into society.  That‘s why we reached for people who are not the crazies in Iran.  That‘s the argument for why we shouldn‘t bomb Iran that I hear from my liberal friends, is that Iran can be integrated and that they do have an interest in being engaged in the West.  

ANDREWS:  We have undermined them. 

BLANKLEY:  No, we‘ve strengthened them. 

ANDREWS:  By declaring them the Axis of Evil, by asking them for help in Afghanistan, where—where the actual attack on this country started.  Hold it.  Tony, just listen.  They supported our attempt to stop the people that came into our country and attacked us.  Iran supported us.  A week or so after they supported us, and enabled us to be victorious in that first wave of Afghanistan, and getting the Taliban—

BLANKLEY:  No. 

ANDREWS:  We rewarded them by declaring them the Axis of Evil.  We took our eyes off the ball, the real people who had attacked us.  Instead, we put those ideological blinders on that the neo-cons provided this country, and went after a country that was no threat whatsoever to the United States, killed thousands of our soldiers, hundreds of thousands of innocent Iraqis, and put this country in the disaster that it—

BLANKLEY:  That is the debate of 2003 reiterated. 

MATTHEWS:  What you now call a 50/50 bet. 

BLANKLEY:  I think it is a 50/50 bet. 

MATTHEWS:  A hundred thousand people dead, 4,000 American service members dead, families missing servicemen for a 50/50 bet. 

BLANKLEY:  Was World War II worth it? 

MATTHEWS:  It wasn‘t a 50/50 bet.  We got rid of Hitler and that was good. 

BLANKLEY:  We didn‘t know in the beginning.  When my old country, England, started, they didn‘t know they were going to win.  London lost 40,000 people in the blitz alone.  Was it worth it?  Yes, to beat Hitler, you betcha. 

MATTHEWS:  It turned out that Roosevelt was right, the Japanese did attack Pearl Harbor.  It turned out that George Bush was wrong, Saddam Hussein did not have WMD.  Thank you, Tony.  Don‘t ever go with the metaphors.  They‘re trouble.  Tony Blankley, I want your book on when you come on, for that abuse you had to take.  Tony—and being on the wrong side of the issue here.  Tony Blankley, Tom Andrews, thank you.  Former Congressman from Maine, right? 

ANDREWS:  That is right. 

MATTHEWS:  Up next, get ready for Obama.  He‘s coming to town tomorrow on a train ride from Philadelphia, coming down Amtrak like everybody else.  I think it‘s a special train.  Nearly three quarters of the American people, by the way, now approve of the way he‘s handling this transition.  It‘s pretty good consensus for this country.  We‘ll be back with the politics fix in just a minute. 

Take a look at this, they‘re getting ready for the big concert down on the Lincoln Memorial.  There it is.  That‘s going to be big.  And you know it‘s going to be a cold inaugural weekend when the violin players are wearing gloves.  There‘s a chill and a buzz in the air, as Washington gets ready to welcome the 44th president.  This is HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back for the politics fix.  Joan Walsh is editor in chief for “Salon,” and Jonathan Martin is a senior writer for “Politico.” 

It‘s Friday afternoon, right before the inaugural.  Joan, you‘re smiling, so are you, Jonathan, and I‘m smiling, except I‘m tired.  Let‘s go to this, it seems to me that we have a president coming into office with big hopes and huge, huge problems, the economy.  We‘re losing a half million jobs a month at this rate.  By next summer, at the end, we‘ll be up to 15 million people unemployed, Joan.  If you get to the hard numbers and you get away from percentages, 15 million people unemployed, we are getting up there -- 

JOAN WALSH, “SALON”:  We are. 

MATTHEWS:  -- to something called a depression.  And it may be even longer than any recession we‘ve had since the ‘30s.  Is this blockbuster stimulus package, somewhere about 800 billion dollars, got the clout to deal with this problem? 

WALSH:  I think it is a start.  I think a lot of people are happy with it, Chris.  I don‘t think anybody entirely knows.  But I think there‘s still a significant number of Republicans who are raising questions about should we be spending this much money?  Is this just more old fashioned Democratic spending?  That‘s why we saw Obama today go to the state of Ohio, John Boehner‘s home state—I don‘t think it was his district—but taking the fight out. 

And he is going to have to spend some political capital to get this passed.  He is really got to make the case that this is smart spending, this is needed spending, and that it will stimulate the economy and create and save jobs. 

MATTHEWS:  Jonathan, we just showed a clip in the third part of the show tonight of the long ago—it seems long ago inaugural address of Ronald Reagan, where he said “government is not the solution, government is the problem.” 

JONATHAN MARTIN, “POLITICO”:  Yes. 

MATTHEWS:  Have we gone full circle on that?  Is it now time not for the private sector, which has failed, if you look at the housing situation, the car sales—it has failed right now—for a government to be the solution?  Is that really the profound difference in the times? 

MARTIN:  Chris, as you well know, don‘t forget that President Bill Clinton, a Democratic president, said, much more recently, that the era of big government is over.  And it appears like, at least temporarily, it‘s make a comeback here.  I think that President-Elect Obama and a lot of Democrats and some Republicans believe that there are few things that we can do to get this economy moving again.  But one of the things you can do is to, you know, invest in infrastructure, try to create some jobs. 

And obviously if you‘re a Republican, and even some Democrats, prefer cutting taxes to try to encourage businesses to create more jobs.  So government is sort of intervening here, is playing more of a role.  It‘s a temporary thing, Chris.  It will be fascinating to see what happens not this year but next year and 2011.  What kind of approach Obama takes to government, using the sort of tools of government.  That, I think, will pay a big role in his re-election in 2012. 

MATTHEWS:  Well, one thing for sure, nobody is looking to New York to save the country, the financial community.  No one is looking to Detroit to safe the economy.  What‘s good for Detroit isn‘t necessarily good for the economy yet.  Let‘s take a look at what the president-elect is talking about doing today. 

(BEGIN VIDEO CLIP)

OBAMA:  Recovery is not going to happen overnight.  It‘s likely that even with the reinvestment package that we‘re putting forward, even with the measures that we‘re taking, things could get worse before they get better.  Now, I want everybody to be realistic about this. 

But if anybody doubts we can dig ourselves out of this hole, I invite them here to Ohio and look what you‘ve done here at Cardinal Fastener. 

(END VIDEO CLIP)

MATTHEWS:  Well, he‘s playing down hopes, Joan.  Is that smart?  Is that Rooseveltian or Reaganesque, to be playing down hopes of what he can get done in the next year? 

WALSH:  I think he has to, Chris.  I mean, there is no magic bullet.  There‘s nothing he can do on January 20th that‘s really going to immediately reverse this tide of job loss.  I think he‘s got to prepare us, he‘s got to talk to us like we‘re grownups, which we all enjoy, as painful as it may be to hear, and let us know we‘re in for a long struggle. 

I also want to say, I don‘t think it‘s government alone.  I think what we‘re going to see is government in partnership with the private sector.  A lot of the things Obama is talking about will help the private sector.  When you think about health care, health insurance reform, that is crucial to solving the problems of Detroit, where health care and pensions and health care for retirees adds so much to the cost of a car.  All across the private sector, there are these public burdens and responsibilities that we‘re talking about sharing in new ways. 

So I think that‘s what‘s exciting.  If this gets totally polarized into pro-government, anti—government, government/private sector, I think we could have a stalemate that nobody wants to see. 

MATTHEWS:  I‘m stunned to hear my liberal friend, Joan, talking about how you‘re counting on the private sector.  It hasn‘t exactly been hardy lately.  What part of the private seconder do you have faith in right now? 

WALSH:  The Internet. 

MATTHEWS:  OK.  Thank you, Joan.  That‘s where you are.  Joan Walsh, Jonathan Martin coming back in a minute. 

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BUSH:  As the years passed, most Americans were able to return to life much as it had been before 9/11.  But I never did.  Every morning, I received a briefing on the threats to our nation.  I vowed to do everything in my power to keep us safe. 

(END VIDEO CLIP)

MATTHEWS:  Joan, I have to tell you, your headline this morning in covering that speech last night was absolutely memorable: “Every Kid Gets a Trophy.”  It is the rule of little league.  It is the rule of every kids‘ sport now.  No matter how hard you play—I‘m sorry, no matter how badly you play, you get a trophy.  You‘re saying, in that spirit, President Bush delivered one to himself. 

WALSH:  Now, my friend—

MATTHEWS:  You are so cruel.  Go ahead. 

WALSH:  I quoted you.  You said it last night. 

MATTHEWS:  Did I? 

WALSH:  After his speech.  Are you kidding?  That‘s so funny.  Yes, you did, I was very impressed.  That was what it sounded like.  You know, like I didn‘t do a very good job, but I did my best.  The self-pity of that last moment that you captured, it went back to normal for you.  But I had to listen to the daily briefings.  I mean, give me a break. 

And finally—I‘ll stop in a second.  But the point that you made earlier about a cop who shoots an unarmed man does not then regret that the guy didn‘t have a gun.  He regrets that he killed an innocent man.  And he regrets that he didn‘t take the extra 30 seconds maybe to ascertain whether the guy was armed.

MATTHEWS:  You know, I have the greatest respect for policemen.  I mean, deep respect for them.  If a cop or—I was a Capitol policeman.  In that cases, it was a fairly unthreatening position.  I‘ve got to tell you, any policeman that does that by accident, no matter how accidental it was, in the case—Bush‘s best case for him is it was purely accidental; he didn‘t know what he was doing.  He didn‘t know what he was doing.  The best case for Bush is he didn‘t know what he was doing.  To say it was a disappointment they didn‘t have the WMD, when he should have felt shame, with 100,000 dead Iraqis, the 4,000 dead Americans, that a war was justified on the basis of something that wasn‘t there. 

Jonathan, your thoughts.  Render an objective thought here.  We need one. 

MARTIN:  Well, the hope is that he will be vindicated by history.  Look, I think it‘s going to be tough for him domestically to get any kind of a fair break.  I think the hope among the Bush loyalists is that 30, 40, 50 years from now, the Middle East will be in a place where Bush will get some credit for starting a sort of change there.  That‘s the idea.  Perhaps now, it sounds far-fetched.  I think that is certainly the hope. 

The challenge they have is that it‘s tougher to make that case, especially with the economy in the past six months, that domestically he is going to have much of a legacy. 

WALSH:  I‘ll spin it for him.

MATTHEWS:  Joan, does he know he‘s the number one reason why the Democrats are extremely popular right now? 

WALSH:  I think he does. 

MATTHEWS:  And the Republican party is a brand that can‘t even sell? 

WALSH:  I think he does.  I‘m going to spin it for him and for you and for Jonathan, Chris, and I‘m going to tell you what his positive legacy will be.  It will be that he created the conditions in this country to elect Barack Hussein Obama to get Americans to take a chance on this visionary, I believe, man, who will I think do a good job.  That might be the best he can do.  And I hope he‘s proud of that. 

MARTIN:  Chris, you‘re a student of history.  You‘ll appreciate this.  Obama is in many ways fitting in the American tradition.  We elect presidents who tend to be the exact opposite of their predecessor during tough times.  Clinton was very different, much more in touch with average Americans. 

MATTHEWS:  It‘s ironic, but it‘s true.  Me helped make Barack Obama possible.  Thank you Joan Walsh.  Thank you Jonathan Martin.  Have a nice weekend, big day coming up next week.  Join us again tomorrow night for a 5:00 special Saturday edition of HARDBALL.  Coming up next, “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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