updated 1/22/2009 12:35:46 PM ET 2009-01-22T17:35:46

Guest: Jonathan Weisman, Eugene Robinson, Pat Buchanan, Richard Wolffe,

Dan Gross, Sally Quinn, David Corn

DAVID SHUSTER, MSNBC ANCHOR:  Chris and thank you for sticking around for a few minutes.  We‘ve got a heck of a show coming up.  Chris Matthews.

Tonight, we will go through Barack Obama‘s first full day in office, including the calls to world leaders, the slew of meetings and the new executive orders.

Plus, the battle over Obama‘s Treasury Secretary Nominee, Tim Geithner apologized repeatedly, today, for his own tax problems.  Will it be enough?

Later, Hillary Clinton was confirmed for Secretary of State just in time for a National Security meeting at the White House.

Also the Republicans who are preparing to grill CIA pick Leon Panetta they‘ve earned a spot in our “Hypocrisy Watch.”

Finally it was the biggest craft for any event in U.S. history.  More on the inauguration, the balls, and the wonderful surprise the Obama girls discovered at the White House, all now on “1600 PENNSYLVANIA AVENUE.”

Good evening, everybody, I‘m David Shuster.  Welcome to the show.

Today, wee got our first look at President Barack Obama at work.  The first official image from the White House photographer included this one from a meeting earlier this morning, that‘s President Obama talking with Chief of Staff Rahm Emanuel at the President‘s desk in the Oval Office.

Joining us now “Hardball” host and friend, Chris Matthews.  And Chris, as we‘ve seen these iconic images today, what‘s been your sort of view and your reaction as you‘ve been watching this?

MATTHEWS:  The staffer is the photographer in this show.  Him or her meeting with boss is a very attractive picture to put on your wall to get into his favors.  And of course, Rahm Emanuel is going to be one tough ramrod of this administration.  I bumped into him the other day at a party and he said, remember what‘s in “The Prince” by Machiavelli, it‘s better to be feared than to be loved.  I think that could be the standard of this administration.

We‘ve got to get things done in this country.  Rahm Emanuel is going to make sure they get done.

SHUSTER:  Chris, I was—it was also so striking.  There was a John McCain on the senate floor urging bipartisanship.  Let‘s run that sound bite and then I‘ll get your reaction on the other side.  Watch.

MATTHEWS:  Ok.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, ® ARIZONA:  We also had a remarkable and historic time yesterday as this nation has come together in a way that it has not for some time.  I, like all good politicians, pay attention to the President‘s approval ratings.  They‘re very high.

But more importantly, I think the message that the American people are sending us now is they want us to work together and get to work.

(END VIDEO CLIP)

SHUSTER:  Chris, you know John McCain so well.  What was your thought about that?

MATTHEWS:  Well, he was defending in that conversation Senator Clinton‘s nomination for Secretary of State.  He doesn‘t want any small problems to prevent comedy here, for people to get along on the big—clearly Barack Obama wants Hillary Clinton, he‘s got her now.  She was sworn in her own office this afternoon.  She‘s going to be a major player.

We‘re looking at a major political coalition here between Obama and Senator Clinton.  This is almost like a parliamentary coalition, two strong political players with strong constituencies.

She had 18 million votes.  This is serious power politics.  And I think McCain, who is a heavy weight, is saying, don‘t get in the way of a person putting together a government because that‘s the key to getting the job done.  You‘ve got to let the boss and this time the President put the government together before you can argue about policy.

So he‘s saying, let‘s not get in the weeds here over these potential conflicts.  Let‘s deal with the real need for action.

SHUSTER:  And then Chris, Barack Obama also spoke early this morning talking about this huge opportunity that exists with this bipartisanship.  With the cabinet that Obama‘s put together.  Here‘s Barack Obama.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  And what a moment we‘re in.  And what an opportunity we have to change this country.  And for those of us who have been in public life before, you know, these kinds of moments come around just every so often.  The American people are really counting on us now.  Let‘s make sure we take advantage of it.  I know you will.

(END VIDEO CLIP)

SHUSTER:  Chris, I know we‘ve been talking ever since yesterday about what an incredible time this was yesterday and, again, incredible moments we‘re seeing today.  I wonder if you Chris, with all your experience can put it in some sort of context historically for us.

MATTHEWS:  Well, I know what it is like to sit in one of those rooms and hear the President and perhaps come in and make a pitch.  And I think the more we see this, the better.  I like to see Presidents doing their jobs.  I like to see meetings, I like to see guys or whoever the President is, getting things done in a room.

I don‘t want to hear about it in the paper next week.  I don‘t want to hear he‘s off cutting brush either by the way or working out on his treadmill or whatever he‘s doing something in some workout.  I want to hear that he‘s actually working, putting in 40 hours a week, at least a presidency working.

And I think what we‘re seeing from Barack Obama, maybe it is to show off his difference from Bush, but you actually see him doing stuff today.  And that‘s more than just going to prayer services.  It‘s actually running the government.

And so I think we‘re going to see more of this.  My hunch is that Barack wants us to see him actually being President.  And so I think we‘re going to see a lot more pictures of him in action which I think is more transparency than we‘re used to.

And I hope it actually shows us what‘s going on.  I thought today when he was actually swearing in those staffers with Joe Biden, the VP, and he was giving a pitch to his staffers about what kind of action and what kind of ethics he wanted them to uphold, he‘s not going to give them any raises, he said that to the top staffers.  He doesn‘t want them becoming lobbyists and coming back and lobbying the government on his watch.  He‘s laying down the law in public.  And I think that‘s a good thing, myself.

SHUSTER:  Chris Matthews the host of “Hardball.”  Chris, thanks so much.  Terrific show tonight.  And again, “Hardball” airs again at 7:00 p.m. Eastern.  And Chris thanks again.

MATTHEWS:  Thank you.

SHUSTER:  This show, of course, is all about “1600 PENNSYLVANIA AVENUE.”  So stay with us everybody we‘re going to have a full rundown on the President‘s day throughout the show including which top staffer couldn‘t find his way into the White House today.

Plus, some big changes to the official White House Website.  It‘s all coming up this hour on “1600.”

Well, the first order of business for the new President is getting his staff in place including nominees that have run a new confirmation trouble.  The Senate approved Hillary Clinton as Secretary of State late today.  But lawmakers did not show the same love to Treasury Secretary Nominee, Tim Geithner, under fire for underpaying his taxes from 2001 to 2004.

(BEGIN VIDEO CLIP)

TIMOTHY GEITHNER, TREASURY SECRETARY NOMINEE:  I did what I thought was the right thing to do at that time which is the IRS told me what I owed.

JON KYL, ® ARIZONA:  Yeah.  Would you answer my question rather than dancing around it?  Please?

GEITHNER:  I would never put myself in the position where I was not intention—where I was intentionally not meeting my obligations as an American taxpayer.  In this case, I made a series of mistakes but they were not intentional mistakes.

(END VIDEO CLIP)

SHUSTER:  That was a tough exchange there with Arizona Republican Senator Jon Kyl.  Let‘s bring in “Wall Street Journal” White House correspondent, Jonathan Weisman who broke the Geithner tax story last week.

If we can get his take on the latest of the confirmation battle.  And Jonathan, it does seems that despite this sort of grilling today about the taxes that it does seem Geithner is still eventually going to get confirmed, right?

JONATHAN WEISMAN, THE WALL STREET JOURNAL:  Yes, it‘s really interesting.  I think if this was happening in a moment of peace and tranquility and prosperity this would be a big deal.  The press would be looking for something to grab on to.

And I think that a lot of the lawmakers would be looking for something to grandstand on.  And remarkably, you know, $32,000, or $34,000 in unpaid taxes seems to not be waylaying Geithner.

Tim Geithner did have a pretty tough time today but nobody thinks this is going to stop his confirmation.

SHUSTER:  The irony was that, I mean, Geithner has been associated with some of the problems that helped create this economic mess and this sort of lack of regulation in the first place.  And that came up from the Senator Jim Bunning a Republican from Kentucky.  Watch.

(BEGIN VIDEO CLIP)

SEN. JIM BUNNING, ® KENTUCKY:  Mr. Geithner has been involved in just about every flawed bailout action of the previous administration.  He was the frontline regulator in New York when all the innovations that recently have brought our markets to their knees became widespread.

All those actions are failures to act raise questions about the nominee‘s judgment.

(END VIDEO CLIP)

SHUSTER:  Jonathan, that criticism from Senator Bunning, is it fair or unfair?

WEISMAN:  Well, you know, it‘s a double-edged sword.  Look, when Geithner‘s name first came up, a lot of people said, hey, I‘m not sure if it‘s wise to name somebody who is actually there at the creation of this crisis.

But others said, look, this guy knows this inside and out.  He has been there.  He‘s been fighting this—fighting this crisis from the very beginning.  Nobody knows what is going on in Wall Street and in the financial markets like Tim Geithner.

Look, he might have had problems, but he is the guy in the spot and that argument has won the day.

SHUSTER:  It was so clear, today, as Barack Obama met with his national—with his economic advisers, and you are already hearing about the rollout on Capitol Hill involving this economic stimulus plan, the biggest in U.S. history, that clearly the President is trying to use the sort of bully-pulpit to try to make sure that members of Congress fall in line.

How much of a distraction has the Geithner confirmation hearing been in terms of it hasn‘t gone as quickly, obviously for the reasons you‘ve articulated and reported.  But how much of a distraction has it been?

WEISMAN:  Well, you know, we spent a lot of time watching those hearings today.  So in some ways this was a lost day.  Nobody was talking about the stimulus plan.  There was a big economic meeting today, was mostly focused on what in the world to do about the latest collapse in banks and bank stock.

Nobody was talking about that either.  They were talking about Tim Geithner‘s taxes.  That‘s not a good day for the President.

But, look, he‘s still got the bully-pulpit.  And when he issued the warning yesterday to opponents of his economic plans that the ground has shifted beneath them, that was a stark warning to anybody who‘s standing in his way on these economic matters.

SHUSTER:  And the President, of course, we just learned is going to be meeting with members of both parties in Congress at the White House to talk about some of those economic matters on Friday.

And Jonathan, we look forward to talking to you, perhaps, then about this.  Jonathan Weisman, now White House correspondent for the “Wall Street Journal.”

Jonathan thanks for coming in.

WEISMAN:  Thank you.

SHUSTER:  Up next, President Obama hit the ground running today meeting with his national security as well his economic team to discuss ways to end the war in Iraq and how to close Guantanamo bay.  Analysis ahead from the very best: Pat Buchanan, Eugene Robinson and Richard Wolffe.

And we have an encouraging update.  Senator Ted Kennedy has returned home and is reportedly in good spirits after suffering a seizure during yesterday‘s inaugural luncheon.  Doctor‘s blame the 76-year-old‘s latest health scare on simple fatigue.

More “1600” in a moment.

(COMMERCIAL BREAK)

SHUSTER:  Welcome back to “1600.”  Today, Hillary Clinton was easily confirmed by the U.S. Senate as Secretary of State.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  94 members having voting aye and two members voted nay.  The nomination is confirmed.

(END VIDEO CLIP)

SHUSTER:  And over at the White House, the new guard was sworn in at the White House.

JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES:  I, repeat your name please, do solemnly swear or affirm.  That I will support and defend the constitution of the United States.  Against all enemies foreign and domestic.

(END VIDEO CLIP)

SHUSTER:  This afternoon, President Obama held his first formal meetings in office with his economic team and his defense team which now includes, of course, Secretary of State Hillary Clinton.

Here to talk about the politics and policy of the global challenges Obama has before him.  Our panel of political analysts: Washington Post columnist, Eugene Robinson; former Reagan communications director, and Nixon‘s speech writer, Pat Buchanan; and “Newsweek” senior White House correspondent, Richard Wolffe.

Eugene, we just saw the senior staff there being sworn in.  What were you thinking?

EUGENE ROBINSON, WASHINGTON POST COLUMNIST:  I‘m thinking it‘s not what I‘m thinking—it‘s what they were thinking.  I think they were all becoming cognizant of the responsibilities and also the volume, the mountain of work that they have before them in all these areas.  And foreign policy is always job one in that it happens when you least expect it.

SHUSTER:  Now Pat, 94 to 2 is the vote for Hillary Clinton.  Two Senators voted against, Cornyn and DeMint of South Carolina and Cornyn from Texas.

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  Well, DeMint and Vitter of Louisiana.

SHUSTER:  I‘m sorry, DeMint and Vitter.  What was the feeling on that?

BUCHANAN:  Well, Vitter was a—looking very hard into the conflict of interest in the Bill Clinton thing, I think DeMint is looking to break out of South Carolina, you‘ve got Lindsey Graham there, you‘ve got Sanford, both been talked about Vice Presidential possibilities.  DeMint led the anti-immigration battle or the anti-immigration reform.

I think he‘s gone national making a name for himself, quite frankly, here, standing out because he feels down the road if this looks bad he was the one guy that stood up and voted no.

SHUSTER:  And what about Vitter, Richard Wolffe?  I mean, why would Vitter possibly oppose Hillary Clinton as the Secretary of State?

RICHARD WOLFFE, NEWSWEEK:  Oh, he‘s very conservative.  And the wing of the Republican Party that is, for want of a better term, the black helicopter crowd.  I mean, that‘s anti-internationalists.  And you know, standing up to a Democratic foreign policy figure like Clinton, what harm does it do you?  You establish your credentials.  She‘s going to raise a lot of money for Republicans through this next cycle.  And you get some credibility on that wing of the policy.

BUCHANAN:  He‘s in trouble and he‘s up in two years.  A vote against Hillary Clinton is not going to hurt you in Louisiana.

SHUSTER:  Democrats are going to say, ok, that guy is on our target list.

BUCHANAN:  He already is.

SHUSTER:  All right.

Let‘s talk a little bit about Guantanamo bay.  There was a meeting, of course, with the national security team.  They have floated this memo that outlines the executive order they‘re considering to close Guantanamo Bay.

Richard, is this enough simply to put it out there, so the press will talk about it to satisfy people that, yes, this is under consideration?  Why bother sort of floating a memo before the memo is actually ready to be released?

WOLFFE:  Well, that‘s a good point, I mean, for a start they did take some pretty significant action which is to stop the immediate military commissions.  The trial is going on down there.

This is going to be a long-term challenge for them.  Dealing, especially with that hard-core group that they still think need to face trial.  But this is moving.  You‘ve got international government saying they‘re going to take some of these detainees.  They obviously want to signal to their base that they are moving the signals for the rest of the world that they‘re moving on this.

So there are a number of reasons.  But I think first and foremost because it leaked, they need to show that this is actually real.  There is some substances here.

SHUSTER:  Well, speaking of sending signals to the rest of the world, I want to go back and play some stuff that I think is worthy of a second-day look.  And that is Barack Obama, his apparent hits on President Bush in the inauguration speech.  Watch.

(BEGIN VIDEO CLIP)

OBAMA:  We reject as false the choice between our safety and our ideals.  Those ideals still light the world and we will not give them up for expedience‘s sake.  America is a friend of each nation and every man, woman and child who seeks a future of peace and dignity.  And we are ready to lead once more.

Earlier generations faced down fascism and communism not just with missiles and tanks but with sturdy alliances and enduring convictions.  Power alone cannot protect us.  Nor does it entitle us to do as we pleased.

(END VIDEO CLIP)

SHUSTER:  Pat, your reaction.  I mean, he‘s going after the Bush administration on torture, he‘s saying when there‘s a false choice between our safety and our ideals, saying, no we can still stand for the rights of man for common law as opposed to throwing that away for security?

BUCHANAN:  This is a repudiation of neo-conservatism and the Bush/Cheney policy, quite frankly.  In terms of foreign policy, we use our power to basically impose our Democratic ideology.  Sometimes we have to use ugly and horrible means in order to get at the truth to save lives.

He‘s saying we‘re moving in a different direction and I agree with Richard.  He‘s appealing to his base here; he‘s saying exactly what he‘s going to do.  And frankly, it is the differentiation between him and the Bush administration.  He‘s made his commitment to the Guantanamo Bay.  I don‘t see any way he can avoid doing what he promised to do, even though he‘s got a hellish problem on his plate by doing it.

RICHARD WOLFFE, NEWSWEEK:  By the way, David, I don‘t think—I don‘t think—sorry—I don‘t think as a candidate, Obama could have said that line, that power alone will not protect us nor does it allow us to do as we pleased.  You can never get away getting elected and saying that kind of thing because it‘s such anathema to what we‘ve heard for the last eight years.

SHUSTER:  What about the situation in Iraq?  I mean, he met with his joint chiefs today.  One of his other campaign promise is that there would be a new mission on day one.  Did we hear about the new mission today?

EUGENE ROBINSON, MSNBC POLITICAL ANALYST:  Not really.  In a sense, this is ironic.  That Iraq—in a sense is the least of his problems because there is a broad consensus about Iraq.  We are on the way out.  It‘s a question of how quickly we get out.  And everyone seems to be on board that idea.

I agree that on Guantanamo, he has to make a statement, he has to make a commitment, I think with the time certain.  I think what was being floated was, you know, one year as opposed to the idea of a statement about getting out of Guantanamo.

BUCHANAN:  The immediate problem is the Middle East, quite frankly, making this cease-fire stick.  He‘s already called the Palestinians first.  He wants to get those borders secured to protect the Israelis.  No more weapons going in.  But what is he going to do about the humanitarian crisis in Gaza?  Is he going to make the Israelis open that up to electricity, fuel, food?  In which case he‘s going to have a real problem with the Israelis.

SHUSTER:  And I think it was very smart of them to make their first series of phone calls to the Palestinians, Israelis and other leaders in the Middle East because clearly that is the conflagration point, right Richard?

WOLFFE:  Right.  And look at his language in that statement.  These statements get scrubbed by everyone in the foreign policy establishment who‘s actually got sworn in today.

Two things to that: that would not have come out of the Bush White House.  First of all, spending on infrastructure in Gaza—that‘s not something we‘ve seen at all, no effort at that, really.  And secondly, he talked about an effective anti-smuggling mechanism, not saying the Palestinians have to stop this and then everything else will follow.

By mechanism, that‘s diplomatic double speak for an international enforcement, so not just the Egyptians here.  But you could see an international force coming in and closing down those tunnels which, by the way, Richard Angle was crawling that today.  I mean, if NBC can get into them then international people can.

ROBINSON:  This is something we would not have heard in the last eight years from George W. Bush.  In the preceding eight years we would have heard something like this from the Clinton administration.  In the proceeding four years we would have heard it from George H.W. Bush.  In a sense, it‘s a return to a more traditional American foreign policy and posture in the Middle East.

BUCHANAN:  Bush has been more strongly pro-Israel than any president in history in my memory.  I think in order to get a deal done, there‘s going to be a bit of a collision.

But I‘ll tell you, you do that here and in the country—I mean, the Congress voted only five dissenting votes to a 100 percent pro-Israeli resolution—

SHUSTER:  That takes us to an issue we‘re going to get back to.  I promise, Pat Buchanan, you‘re the best on that.  Maybe that‘s not the right word.  You‘re the best about arguing with people who disagree.

Pat Buchanan, Richard Wolffe, Eugene Robinson, thank you all so much. 

We appreciate it.

We‘ve been hearing about Republican plans for the confirmation hearing of President Obama CIA nominee, Leon Panetta.  And that is the subject of tonight‘s “Hypocrisy Watch.”

According to the “Washington Times” Republicans on the Senate Select Committee and Intelligence intend to grill Mr. Panetta, about what, if any role he played as President Clinton‘s chief-of-staff and shaping the policy known as extraordinary rendition.  The practice involves seizing a terrorist suspect in one country and taking him to another without judicial proceedings.  Oftentimes the destination country embraces torture.

It appears the Clinton administration and the previous administration of George H.W. Bush approved of a few extraordinary renditions.  However, the practice increased exponentially under the administration of George W.  Bush.  All the while, most Republicans insisted it was an essential tool and they hammered critics.

It‘s refreshing to hear so many Republicans now describe extraordinary renditions as bad policy and un-American and there should be some inquiries into Panetta.  We all deserve to hear his views.

But the Republicans plan to go beyond inquiry and possibly badger and condemn Panetta is ridiculous.  Slamming Panetta for something you supported for eight years?  That‘s hypocrisy and wrong.

Likewise, if Democrats fail to ask Panetta on his view on extraordinary renditions after years of complaining about the practice, that would be hypocrisy as well.

Up next, a key talking point for Wall Street bailout defenders, is that U.S. taxpayers have made money with the deal.  Not true.  Mythbusters with Daniel Gross is ahead.

Plus, the Obama administration promises a change.  From politics as usual, how has Washington changed in the last 24 hours?  What‘s the impact already in the city‘s elite social scene?  Especially following some of the stories from those balls last night.

You‘re watching “1600 PENNSYLVANIA AVENUE.”

(COMMERCIAL BREAK)

SHUSTER:  Welcome back.  We‘re going to get to a special edition of “Mythbuster” Wednesday with Dan Gross in just a moment.

But first, top White House staffers will be feeling the pain of tough economic times in their own pocketbooks.  Today president Obama signed an executive order freezing the pay of White House personnel who make more than $100,000.  It‘s a largely symbolic move but many consider it to be an appropriate one given the economic crisis that we‘re in.

That includes the government‘s recent massive bailouts of Wall Street firms otherwise known as the Troubled Asset Release Program or TARP.  It‘s come under fire because of the lack of oversight and the hundreds of millions that have been doled out, some into the bank accounts of CEOs of these various institutions.

Some politicians are now claiming the $700 billion bailout is actually making money for taxpayers.

Here to bust that myth is Dan Gross, senior editor at Newsweek.  Dan, here‘s what Republican Senator Judd Greg had to say in the “Wall Street Journal.”  “The TARP, for all its warts, has involved using tax dollars to invest in assets that will have a return to tax payer.  In fact, the estimate to date is that the TARP has actually had a gain of about eight billion dollars, while recapitalizing the financial system.  With this type of stimulus, there will be little if any long-term increase in the debt.” 

What‘s wrong with that? 

DAN GROSS, “NEWSWEEK”:  David, you know what that is.  It‘s a myth.  That was based on some very preliminary numbers that were done in December and the creators of those numbers, an outfit called Beonco Research (ph), has since disavowed as being not accurate. 

Look, the government essentially created a mutual fund based on large financial companies like Citigroup in the fall.  And since then, the values of all those stocks that we‘re now part owner of has plummeted.  The theory was that the United States borrows at two or three percent a year.  We get this preferred stock that yields seven or eight percent.  The difference could be the profits.

But you have to account for the actual value of that stock and the fact that many of these companies, especially Citigroup, which now needs a new backstop, are in trouble. 

SHUSTER:  Dan, I don‘t want to wade into my own sort of myth busting.  I‘m on unsure territory in your area of expertise.  As far as the whole idea that we were going to be able to track, almost in real-time on the government website, how this money was sort of being used or how assets were being bought, has that now proven also to be a myth, given that so many of these institutions simply can‘t say or won‘t say what they did with the money? 

GROSS:  Yes.  The larger issue is we don‘t have any real-time information.  If you own a mutual fund, you can go every day to see what shares they own, what they‘ve been buying and selling and what the net asset value is.  The Federal Reserve lent 30 billion dollars to an entity called Maiden Lane.  It bought all this stuff from Bear Stearns.  It was worth 30 billion dollars.  That was in the spring.  By the end of September, which was three months ago now, it was down to 27 billion.  It had already lost 10 percent in a four or five-month period.  The information we‘re getting is really a trickle. 

SHUSTER:  So, Dan, to circle back to Senator Judd Greg and what he said in the “Wall Street Journal,” the people who are putting this stuff out there about the TARP essentially giving a gain to taxpayers, what is driving them to say that stuff, given that folks like you have already proven that it‘s a myth? 

GROSS:  Part of it is about confidence.  We don‘t want people to think that our financial system is falling apart.  We want them to think these companies that we are propping up are actually being propped up and that the market is realizing that.  As we see day-by-day, especially Citigroup the best example, the biggest—used to be the biggest bank.  It is trending downward and downward. 

SHUSTER:  Daniel Gross, senior editor at “Newsweek,” our myth buster.  If it‘s Wednesday, it‘s Myth Buster Wednesday with Dan Gross, even if I can‘t say it.  Dan, thanks for coming in.  Great stuff. 

GROSS:  Thank you. 

SHUSTER:  Thanks, Dan. 

Just a few minutes ago, we were talking about Guantanamo Bay and how a draft of an executive order to shut down the military prison was being circulated.  We have an update for you.  The Associated Press is now reporting that President Obama will sign that executive order tomorrow to close Guantanamo Bay within a year. 

Up next, there‘s been a flurry of activity at 1600 PENNSYLVANIA AVENUE, as President Obama serves his first full day in office.  We have all the highlights from his day for you. 

Plus, President Obama ran on a campaign of change.  Now that he‘s in office,  will the change he promised really shake up all of Washington, D.C.?  More 1600 after this.

(COMMERCIAL BREAK)

SHUSTER:  Welcome back to 1600 PENNSYLVANIA AVENUE.  President Obama had an action-packed first day as leader of the free world.  It started with a traditional prayer service with First Lady Michelle Obama, sharing a pew with Vice President Joe Biden and Mrs. Biden, Bill and Hillary Clinton. 

Then it was time to hit the office and get to work.  First figuring out the door to the Oval Office and finding what‘s inside.  Here‘s what was on the new president‘s desk the first time he came in, a letter that 43 left for 44. 

The White House movers left the letter, but moved out some of the furnishings, as you can see from this photo of President Obama at his desk with Chief of Staff Rahm Emanuel. 

Around lunchtime, it was off across the street to Vice President Biden‘s stomping grounds in the Old Executive Office Building.  There the new president greeted the new senior staff with stricter ethics rule and a pay freeze.  He signed some executive orders and shook hands with his new staffers. 

Then it was back to 1600 for an open house and some light refreshments before a meeting with his economic team to talk about the financial crisis, and then his defense team to talk about Iraq, Afghanistan and Gaza. 

A late note about new Secretary of State Hillary Clinton was supposed to be at this afternoon‘s defense meeting, but apparently she was not confirmed in time to attend.  President Obama welcomed his new White House staff today with a tall order, remaking America. 

(BEGIN VIDEO CLIP)

OBAMA:  From our vantage point, yesterday, you couldn‘t help but be inspired by the sight of Americans as far as the eye could see.  They were there because they believe this is a moment of great change in America, a time for reinvigorating our democracy and remaking our country. 

(END VIDEO CLIP)

SHUSTER:  Joining us now is Sally Quinn, “Washington Post” journalist and author.  She also founded and co-moderates “On Faith,” a blog from the “Washington Post” and “Newsweek.”  Sally, you attended that traditional prayer service.  We were talking a minute ago.  You noticed some immediate changes just today.  Tell us about them. 

SALLY QUINN, “THE WASHINGTON POST”:  I thought it was one of the most pluralistic services I have ever seen.  It had every religion represented.  They had a Muslim and a Jew and a Catholic and a Hindu. 

But the most interesting part about it was that the women ruled the day.  The sermon was given by a woman, Reverend Sharon Jackson.  The presiding bishop, Catherine Jefford Shorey (ph), gave the closing prayer.  The Muslim preacher was a woman, and so was the Hindu. 

So you had—and several other women gave prayers.  So you had this sense that already something was happening, that there was an inclusion, because normally in a lot of religions in America, they don‘t have very many women involved.  And some—even the Episcopal Church has had problems with having Catherine Jefford Shorey as being the presiding bishop. 

I thought this was like a statement that things are really going to change and we are going to be more inclusive than before. 

SHUSTER:  Speaking of inclusive, two million people packed the mall yesterday or the areas around it for the inauguration swearing in.  The Secret Service and the police today said not a single arrest.  It was clearly one of the most inspiring events, if not certainly the biggest event in U.S. history, in terms of the number of people in attendance.  What sort of impact does this have on Washington moving forward? 

QUINN:  I think it‘s the same atmosphere.  Can you imagine two million people?  We walked for an hour, stood outside trying to get to our destination, couldn‘t get in.  There were cops everywhere and standing out in the freezing cold.  There were all these people who tried to get to the actual—had tickets to the inauguration, couldn‘t get in.  The tunnel of doom they got stuck in. 

Nobody lost it.  It was just—I‘ve never seen anything like it in my life.  But, again, I think it‘s about Obama and it‘s about this whole new idea of we‘re all in this together.  I think it was a metaphor that you can have two million people and not a single incident, not a single arrest. 

Just think of it.  You can‘t have a soccer game without somebody getting arrested. 

SHUSTER:  Some of the new tone certainly feels like it‘s being driven by younger people.  There were so many younger people in the crowd yesterday.  There‘s a very young, vigorous feel to the White House team.  The president went to the balls last night and actually spoke at the youth ball.  Watch. 

(BEGIN VIDEO CLIP)

OBAMA:  What started out as an improbable journey, when nobody gave us a chance, was carried forward, was inspired by, was driven by, was energized by young people all across America. 

The future will be in your hands if you are able to sustain the kind of energy and focus that you showed on this campaign. 

(END VIDEO CLIP)

SHUSTER:  Young people are certainly already involved.  Just if you look at yesterday, the person who wrote a speech, the chief speech writer, 27-year-old Jon Favreau.  The person who designed Michelle Obama‘s dress, 26-year-old Jason Wu.  Is Washington becoming that much younger?  What‘s the impact on these established circles in Washington? 

QUINN:  I think that it is becoming younger and I think it has certainly energized Washington, which has been in a stupor, you know, sort of Rip Van Winkle.  Everybody is waking up and rubbing their eyes, and saying, what happened?  Where have we been?  We‘ve been asleep for a long time.  There hasn‘t been anything going on. 

Suddenly, people are ready to go.  I have to say that Washington socially is on its knees today.  There have been so many parties and so many events and concerts and, you know, people are just really dragging.  But I think that—give everybody a week off and they‘ll be back at it again.  I think that—one of the nice things about it is that part of this whole inclusiveness, and you can look at the cabinet and administration, is that they‘re people of all ages. 

You have the secretary of state and you have the secretary of defense, who are older, and the national security adviser and some of the team.  Then you have Rahm Emanuel is younger.  So you have a whole different group of people in all different generations.  And it‘s part of this inclusive thing, where I think that the younger people are mixing well with the older people.  Everybody seems to want to reach out and meet new people. 

Washington is always a sucker for a new president anyway, because it‘s new blood and we thrive on an influx of new people in transition and all that.  I think it‘s going to be a very exciting and really fun time for everybody. 

SHUSTER:  Sally, good of you to join us.  Thanks so much for coming in.  Sally Quinn of the “Washington Post.”

Tomorrow, Press Secretary Robert Gibbs will field the questions at the daily press briefing.  Today, it was apparently the press secretary‘s turn to ask an NBC reporter how to get into work. 

Plus, Sasha and Malia Obama spent inauguration night playing at 1600 PENNSYLVANIA AVENUE.  They went on a treasure hunt.  What did they find out the end?  You‘ll want to stick around for this. 

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JAY LENO, “THE TONIGHT SHOW”:  The Supreme Court justice—Chief Justice John Roberts made a mistake during the swearing in of Barack Obama.  Did you see that?  That‘s the second mistake the Supreme Court has made with the president if you count the time they declared Bush the winner.  That would be two. 

(END VIDEO CLIP)

SHUSTER:  Some late night laughs courtesy of Jay Leno.  That kicks off today‘s briefing room.  Remember that verbal flub yesterday?  Well, Barack Obama was taking the oath of office.  Even though President Obama and Chief Justice Roberts are both taking responsibility, we have done some reporting and analysis.  Here‘s what happened. 

It was, indeed, the chief justice‘s fault.  When the chief justice administered the oath, he rearranged one of the 35 words.  That apparently threw off President Obama for a moment.  He paused and waited.  Roberts repeated the phrase correctly, and they were back on track. 

Later, President Obama was asked if he was trying to help Justice Roberts with the oath. 

(BEGIN VIDEO CLIP)

OBAMA:  We‘re up there.  We‘ve got a lot of stuff on our minds.  And he actually, I think, helped me out on a couple of stanzas there.  So overall I think it went relatively smoothly.  I‘m very grateful to him.

(END VIDEO CLIP)

SHUSTER:  Right after the oath, at the inaugural luncheon at the Capitol, the president and chief justice were able to talk away from the microphones.  Associate Press reporter Mark Sherman said it appeared Roberts told Obama, quote, “sorry, it‘s my fault.”  That, of course, was not the chief justice.  Good for the chief justice and even better that both men are being so gracious. 

By the way, the issue did come up again today when Vice President Joe Biden couldn‘t resist making light of the high profile gaffe.  President Obama called on Mr. Biden to administer the oath of office for the White house senior staff.  Biden had just sworn in the newly confirmed cabinet secretaries and forgot he hadn‘t done the second group yet. 

(BEGIN VIDEO CLIP)

OBAMA:  Joe, you want to administer the oath? 

JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES:  Am I doing this again? 

OBAMA:  For the—

BIDEN:  For the senior staff, all right. 

OBAMA:  Remember, the cabinet members have already—

BIDEN:  My memory is not as good as Justice Roberts, Chief Justice Roberts. 

(END VIDEO CLIP)

SHUSTER:  Everyone laughed except the president.  The swearing in continued without a hitch. 

Next up, remember this very cute moment from the Democratic convention in Denver this summer?  Michelle Obama brought daughters Sasha and Malia on stage and said, we have a surprise.  One of the girls appeared to respond, the Jonas Brothers?  It was adorable.  The surprise that night was not the Jonas Brothers, just their dad via satellite from Missouri. 

Anyway, dreams do eventually come true when you live at the White House.  Last night, the first daughters entertained some new pals from school.  One of the games included a scavenger hunt to help Sasha and Malia get familiar with the White House. 

At the end of the hunt, Sasha and Malia looked behind a door and discovered Kevin, Joe and Nick Jonas waiting for them.  As you might expect, the Obama girls and their friends for ecstatic.  What a great surprise. 

Finally, all of us can relate to the confusion and logistical questions on the first day at a new school or a new campus.  Well, it‘s been the same for some of the new Obama White House staff.  NBC News chief White House correspondent and political director, Chuck Todd, was at the White House very early this morning, and ran into Press Secretary Robert Gibbs.  Gibbs was looking for help.  Here‘s Chuck on “MORNING JOE.”

(BEGIN VIDEO CLIP)

CHUCK TODD, NBC NEWS WHITE HOUSE CORRESPONDENT:  Robert Gibbs asked for directions this morning.  He didn‘t know what gate he needed to go into when I bumped into him this morning.  That was probably—he was like, where do I go.  But the good news was he was here before the crack of dawn.  They are trying to get to work very early. 

(END VIDEO CLIP)

SHUSTER:  The other good news is that Chuck walked in with Gibbs and showed him the northwest gate.  Gibbs has been to the White House a few times.  But like the rest of us, he may have been thrown off by the reviewing stand and the risers still left over from yesterday‘s inauguration. 

However, in case anybody inside the White House is still looking for guidance, 1600 is here to help.  So, if any of you in the White House want to take public transportation or walk into the complex, here‘s the map.  From the blue line, orange line at Farragut West Metro, walk south on 17th, then east on Pennsylvania Avenue, and go through the White House Northwest Gate. 

If you are driving, it gets a little more complicated.  First, make sure you have a White House parking space.  Robert Gibbs, if you don‘t have one as press secretary, you need to complain to Rahm Emanuel. 

Assuming you do have a space, and you‘re driving, if you‘re coming from south of the White House, go north on 17th and make a right to get to the White House‘s southwest gates.  Spaces are between the White House and the Old Executive Office Building. 

If you‘re coming from north, drive south on 17th, turn left a block past Pennsylvania Avenue and go through the same southwest gate. 

If you see Chuck Todd walking, especially on a cold day, please give him a lift. 

Still ahead, the transition of power online at the official White House website.  At noon yesterday, WhiteHouse.gov changed hands from the Bush to Obama administration.  The new look and content is intriguing.  Up next, some great analysis on the changes from our Muckraker of the day. 

(COMMERCIAL BREAK)

SHUSTER:  The inauguration of President Barack Obama has changed the images now coming out of the White House.  The White House website has undergone some very clear changes as well.  Here‘s what the White House website looked like for the past several years.  Here‘s what it looks like as of yesterday afternoon. 

There is a new color scheme, different font sizes and more.  Earlier this week, there was this instruction to people who e-mail Obama White House staff, quote, “any message sent to these accounts could be forwarded to the White House accounts and subject to the Presidential Records Act.” 

David Corn is Washington bureau chief for “Mother Jones” and a blogger for CQPolitics.com.  He‘s been following transparency issues for years.  He is our Muckraker of the day. 

David, first of all, congratulations.  Your read on the White House website.  Also, tell us about this executive recorder that will make it more difficult for the previous administration. 

DAVID CORN, “MOTHER JONES”:  A lot happened today.  I have to give a shout out to Nick Bowman, my reporter at “Mother Jones,” who has been writing about this for us.  There were several executive orders and memos released.  One basically was about the Freedom of Information Act.  IT was a direction to everybody in the government, which Barack Obama is now the head of—he‘s the big boss—saying you have to give the benefit of the doubt when deciding whether to release information to the notion of releasing it. 

You know, in the memo itself, it says “in the face of doubt, openness prevails.”  Not words I think Dick Cheney ever, ever said.  That was just one of a flurry of executive orders. 

Another one dealt with the presidential records and how they‘re kept.  According to an order that Bush put out, it made it very easy for past presidents, such as, say, the father of a current president, to keep their records secret by invoking executive privilege.  Under the new order that President Obama put out today, it‘s a lot more difficult. 

If a president—former president wants to invoke executive privilege, he might have to go to court if the current president thinks the documents should be released. 

SHUSTER:  Making it much for difficult for the previous administration. 

CORN:  Openness is prevailing.  The Bush White House lost five, ten—we don‘t even know—million e-mails.  As you just put on the screen, the Obama administration is going to create pains to keep those e-mails.  In fact, even John Podesta, who is heading the transition, the other day, he said, let Barack Obama keep his Blackberry, knowing full well that all the e-mails and text messages he might send on that would fall under the Presidential Records Act, and would one day become public. 

Do you want your e-mails public? 

SHUSTER:  The burden, then, is on him to make sure he doesn‘t put anything sensitive in there.  The burden is not on reporters like yourself.  as it was during the Bush administration to prove this incredible complex hurdle, to get over the hurdle and some how have the hope of getting access to it. 

CORN:  Openness prevails.  It is a philosophical shift.  I think it‘s a generational shift.  If you look at the people moving into White House positions, you know, tech positions and others, these are people who grew up in the 2.0 generation.  And they have a—you know, their default position is transparency, accountability and openness.  And so far Barack Obama has hit a home run or maybe at least a strong triple on the first day in office. 

SHUSTER:  The change from President Bush could not be greater.  David Corn, because of all the work you‘ve been doing all these many years, and today, you‘re our Muckraker of the day.  Congratulations. 

CORN:  I accept with honor. 

SHUSTER:  That is the view from 1600 PENNSYLVANIA AVENUE tonight.  I‘m David Shuster.  Thank you for watching.  We‘ll see you back here tomorrow night, same time, 6:00 p.m. Eastern on MSNBC.  Remember, you can get the latest political news delivered to your inbox, Shuster.MSNBC.com.  I‘m David Shuster.  “HARDBALL” starts right now.

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

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