updated 2/2/2009 9:32:19 AM ET 2009-02-02T14:32:19

Guest: Christopher Ward, Ben White, Harold Ford, Jr., Tony Blankley, Mike Murphy, Richard Wolffe, Eugene Robinson, Dylan Ratigan

DAVID SHUSTER, HOST:  Tonight, do you support Rush Limbaugh or the president of the United States?  Democrats are now running ads pressuring Republican lawmakers to oppose the economic plan. 

Plus, President Obama made this a big day for labor unions.  Senate Republicans are hitting back by holding up his choice for labor secretary. 

Later, those outrageous Wall Street bonuses.  We will separate the modest corporate execs from those who are tone deaf and tell you about a dramatic plan in Congress. 

Also, our continuing series on the problems at Ground Zero.  Tonight, the man responsible for the site will join us for a live interview. 

And they‘ve started changing the Blagojevich highway signs in Illinois, and the rewrite is not cheap. 

All tonight on 1600 PENNSYLVANIA AVENUE.

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

Change has come to the GOP.  Today, the Republican National Committee elected its first African-American chairman.  Former Maryland Lieutenant Governor Michael Steele won on the sixth ballot of the dramatic daylong election. 

After the win, he told the crowd of party faithful that today marked a start of a Republican revival. 

(BEGIN VIDEO CLIP)

MICHAEL STEELE, RNC CHAIRMAN:  We‘re going to bring this party to every corner, every boardroom, every neighborhood, every community.  And we‘re going to say to friend and foe alike, we want you to be a part of us, we want you to work with us.  And for those of you who wish to obstruct, get ready to get knocked over. 

(END VIDEO CLIP)

SHUSTER:  Joining us now, Harold Ford, Jr., chairman of the Democratic Leadership Council and an NBC News analyst, and Tony Blankley of “The Washington Times” and author of the new book “American Grit: What it Will Take to Survive and Win in the 21st Century.” 

Harold, your reaction to the election of Michael Steele? 

HAROLD FORD, JR., NBC NEWS ANALYST:  First off, congratulations to him.  I know him.  He‘s a friend. 

He has his work cut out for him.  That party, in this last election, really the last two national elections, have found themselves marginalized.  They‘ve lost more seats than they‘ve won.  And in this last presidential race, we obviously saw the normal playbook calls that Republicans have employed throughout national elections not work. 

If he‘s able to do that and reach out and expand, he‘ll find some success.  And knowing Michael as I do, he‘ll find some success.  I hope he doesn‘t find too much, as a Democrat, but I wish him well and congratulate him this evening. 

SHUSTER:  Tony Blankley, when Michael Steele was running for the Senate, he had a bumper sticker that said “Steele Democrat.”  And he was not proud of pointing out that he had actually been a Republican, at least on his resume and bio.

Any issues that you have with Michael Steele? 

TONY BLANKLEY, “THE WASHINGTON TIMES”:  No.  I know him.  I think—the best man won. 

Now, by himself, he‘s not going to be able to turn the Republican Party into a champion in a few months.  But there‘s no doubt that just as far as his judgment, his personality, his public presentation, his profile on issues, I think the party picked their strongest candidate to lead the national party. 

FORD:  It will be interesting, David, to watch how he finesses here over the next few weeks, how he‘s able to work with Boehner and McConnell.  And I think how he asserts himself, whomever may have won, but particularly in Michael‘s case, the new chairman‘s case, if he‘s able to assert himself in an constructive and compelling and substantive way right away in the stimulus debate, in the financial services debate, and obviously some of the thornier and bigger questions on the foreign policy side—so it will be interesting to see how that all shakes out.  I think it will determine how effective a spokesman he can be.

BLANKLEY:  Let me say, I have some experience working with party chairmen when I was with Newt.  Haley Barbour was our chairman there. 

I think the most important skill that he will bring to bear, as valuable as a spokesman is, is how he‘s able to work behind the scenes to bring the party, coordinate them together, get them to work as a team.  Haley was superb at that.  And when the party is out of power and there‘s no natural leader, the party chair is the man or the woman who is going to be able, if he is, to get them to work together. 

And I think Michael will have a good chance of doing that, because he is a conciliator.  He‘s not on aggressive...

FORD:  Governor Barbour had a majority when he was...

(CROSSTALK)

BLANKLEY:  No.  No.  No.

SHUSTER:  I dote want to get down to the history of Haley Barbour.  I am intrigued though to see how Michael Steele is going to deal with Rush Limbaugh, because Rush Limbaugh certainly seems to have filled a void.  Democrats are eager for Rush Limbaugh to be the face of the party. 

To set this up, here was Barack Obama, the president, today, talking about reversing policies of the Bush administration.  A big day for the labor. 

Here‘s President Obama earlier today. 

(BEGIN VIDEO CLIP)

BARACK H. OBAMA, PRESIDENT OF THE UNITED STATES:  We have to reverse many of the policies toward organized labor that we‘ve seen these last eight years, policies with which I have sharply disagreed.  I do not view the labor movement as part of the problem.  To me, it‘s part of the solution. 

(END VIDEO CLIP)

SHUSTER:  Now, obviously Rush Limbaugh disagrees.  And I want to play a clip of Rush Limbaugh today in which he was talking about the prosperity wire (ph).  Here‘s Rush Limbaugh essentially taking on the president and his party over the job losses. 

Watch. 

(BEGIN VIDEO CLIP)

RUSH LIMBAUGH, RADIO TALK SHOW HOST:  It puts the total, the casually total, in Barack Obama‘s war on prosperity, now at 46,700 jobs lost just since January.  We‘re tabulating here, ladies and gentlemen, the casualties in the war on prosperity waged by Barack Obama just as they shadowed, just as they talked about and counted the casualties in the war in Iraq. 

(END VIDEO CLIP)

SHUSTER:  Well, let‘s bring in Mike Murphy, veteran Republican strategist and an NBC News analyst.  Let‘s bring him into this conversation.

Mike Murphy, Rush Limbaugh, is he helping or hurting the Republican Party in the midst of all of this? 

MIKE MURPHY, NBC NEWS ANALYST:  Well, I think some of the arguments he‘s making are helpful.  I think Rush, being the center of attention, because he‘s a polarizing figure, is not helpful.  He‘s not the best messenger for those arguments, but I think somebody has to make them. 

The problem with zeroing in on Rush is he represents about 39 percent of the opinion, the vote in the country, and that‘s not a majority-building plan.  So I think part of it, too, is the press is a sucker now that there‘s a vacuum in the Republican Party to try to find one person, when the truth is, there‘s a lot of people now leaving the party.  There is no one person, and it‘s not Rush Limbaugh. 

BLANKLEY:  Let me make a point here.  I think the Democrats make a grievous mistake in wrestling with Rush Limbaugh.  Rush is cleverer and funnier than anyone who has ever fought with him, and he will get the better of them.  He‘s not the entire party, but he‘s a big piece of the communications along with other Republican leaders.  And so I think the president makes a mistake in elevating Rush. 

SHUSTER:  Well, the Democratic Party is certainly elevating him and using him to try to paint the picture of the Republican Party as being Rush Limbaugh.  The group Americans for Change, which is a Democratic advocacy group, here‘s the ad that they are now running on Republicans, and it features Rush Limbaugh. 

Watch. 

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL ®, MINORITY LEADER:  Every House member from New England is a Democrat.  You can walk from Canada to Mexico and from Maine to Arizona...

(END VIDEO CLIP)

SHUSTER:  That‘s actually Mitch McConnell.  All right.  That was actually Mitch McConnell.  The wrong tape loaded up there.  We‘re going to get the right tape loaded in. 

But again, the idea is that Democrats are using Rush Limbaugh.  They feel that this is a wise move for them.  And here is the ad Democrats are running. 

(BEGIN VIDEO CLIP)

NARRATOR:  Listen to what Rush Limbaugh said about President Obama‘s agenda and its jobs package. 

LIMBAUGH:  I hope he fails. 

NARRATOR:  The Obama jobs bill overwhelmingly passed the House, but not one Republican voted yes.  Everyone Republican voted with Limbaugh. 

We can understand why an extreme partisan like Rush Limbaugh wants President Obama‘s job programs to fail.  But the members of Congress elected to represent the citizens in their districts?  That‘s another matter. 

(END VIDEO CLIP)

SHUSTER:  Harold Ford, take us through the Democratic activist strategy in this.

FORD:  The substance of the ad is probably right, but I would take Mike Murphy‘s position.  I don‘t believe this is what President Obama campaigned on.  This is certainly not the way he would want to govern.  This kind of polarizing politics doesn‘t really have a place, I believe, nor I think most Americans believe, in the Barack Obama approach. 

One of the interesting things about, though, as you look at the content of the ad, which is Rush Limbaugh, you look at Michael Steele‘s election today and you look at Rush Limbaugh, they represent two different aspects and dimensions of the Republican Party.  The question that many Republicans and, for that matter, those who are looking at the next election cycle in 2010, who will represent, which face, which voice, which message will be the predominant one for the Republicans?  I think the bigger question is, which direction and which path will they take? 

SHUSTER:  And Mike Murphy, I‘ve got to ask you how Sarah Palin fits into all this.  Sarah Palin is coming into Washington this weekend.  She wants to be a player. 

Does she fit into all of this? 

MURPHY:  Well, she is a player by virtue of who she is, but not a big player.  I think it‘s a sideshow.  I think the media will be a sucker for it.

And I want to underscore something Harold said.  This ad is a problem for Obama. 

This thing undercuts the very message he‘s had such success with.  And I can guarantee, inside the White House, they‘re thinking the last thing we need is some rinky dink, cheap shot ad taking everything out of context from some left wing group, muddying up the kind of bipartisan spirit that he‘s created, which is doing him a lot of good. 

So I think, you know, we have to be careful in the media not to pay attention to the kind of trouble (INAUDIBLE) on the sidelines making noise and keep our eye off the big ball. 

SHUSTER:  Mike Murphy, Tony Blankley and Harold Ford, thank you very much.

We‘re going to hear from Richard Wolffe of “Newsweek” up next as we have an extended panel discussion. 

President Obama says the economy is a continuing disaster for American families, and he‘s appointed Vice President Biden to head up a new rescue effort.  Up next, our political experts will weigh in on how well this new task force will work. 

Also ahead, CNBC‘s Dylan Ratigan will help us identify some of the corporate villains and corporate heroes.  Who‘s using the corporate jets and who‘s cutting back in these tough economic times?

And how about the youngsters working in the White House?  There‘s a whole collection of 20-somethings who have a lot of responsibility in the Obama administration.

More on them ahead on 1600 PENNSYLVANIA AVENUE.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES:  It‘s good to see so many of my friends—our friends from organized labor as well. 

Welcome back to the White House. 

(APPLAUSE)

(END VIDEO CLIP)

SHUSTER:  Welcome back. 

That was Vice President Joe Biden taking a not-so-subtle dig at the previous White House occupants at the announcement for President Obama‘s middle class task force. 

Today, the president announced the creation of the task force to be headed by Vice President Biden, and signed a series of labor friendly executive orders.  He said the orders signal a shift in policy and philosophy. 

(BEGIN VIDEO CLIP)

OBAMA:  Strong, vibrant, growing unions can exist side by side with strong, vibrant and growing businesses.  This isn‘t an either/or proposition between the interests of workers and the interests of shareholders.  That‘s the old argument.  The new argument is that the American economy is not and has never been a zero-sum game. 

(END VIDEO CLIP)

SHUSTER:  Let‘s bring in our panel: Eugene Robinson, columnist and associate editor for “The Washington Post,” and an MSNBC analyst; Tony Blankley of “The Washington Times”; and MSNBC political analyst Richard Wolffe. 

Richard, how fired up are the labor unions over these series of provisions that the president and vice president gave them today? 

RICHARD WOLFFE, MSNBC POLITICAL ANALYST:  Well, they‘re very excited, but they think it‘s a down payment for what it also to come here.  Remember, they campaigned hard for this guy as candidate.  He campaigned very effectively and comfortably with people like Jimmy Hoffa.

So, there is an alliance here of interests, of backgrounds.  But they think this is the start of things to come.  And the question is, how far is he and how fast is he willing to deliver? 

The big piece of legislation is this free choice act, employee free choice act which would make it easier for unions to organize and put pressure on people who do not want to be part of unions.  How quickly the White House going to get behind that and how fierce is the Republican resistance to that going to be? 

SHUSTER:  And Eugene Robinson, the big piece of legislation is this essentially Free Choice Act, Employee Free Choice Act, which some argue would make it easier for unions to organize, perhaps put some pressure on people who don‘t want to be part of unions.

How quickly is the White House going to get behind that?  And how fierce is the Republican resistance to that going to be?

EUGENE ROBINSON, MSNBC POLITICAL ANALYST:  It will be extraordinarily fierce.  You‘re talking about the bill that‘s commonly known as “Card Check,” I believe.  And that‘s going to be a battle royale when it eventually is joined. 

I‘m not convinced that it will be joined in the near future.  I don‘t think the White House is eager to wade into this battle just yet, and would imagine that it hopes that the unions are, you know, excited and happy at the orders sign today, at the creation of this task force, and at this general sense of friendliness and welcome from the White House that they certainly haven‘t gotten in the last eight years. 

SHUSTER:  And yet, Tony Blankley, the Republicans in the Senate are essentially holding up the labor nominee Hilda Solis.  Arguably, she didn‘t do such a great job in answering questions, but she has now made it clear that she does support this legislation. 

Republicans may have an ideological difference with that, but why bother holding her up? 

BLANKLEY:  Oh, I think that‘s just a little bit of elbows out.

Look, Obama has thrown some crumbs to the unions today, but I think he understands that playing to the unions is not playing to the working Americans.  American workers have been running away from the unions for 30 years.  There are very few American workers who belong to unions anymore in the private sector.  And the laws that their asking for, which would take away the secret ballot and require a compulsory arbitration and have the government setting wages in companies, is going to be so damaging, that I can‘t imagine Obama would really like to see that happen. 

It‘s not just the Republicans who...

(CROSSTALK)

SHUSTER:  But Tony, you would acknowledge the unions are infuriated, though, as they look up and see these stories of all the money that executives are still making in the midst of this economy.  The unions, a lot of them want to organize simply to try to pare that back, to support the legislation we‘re going to be talking about in our next segment. 

BLANKLEY:  No, the unions want to organize in order to raise funds.  That‘s what they‘re in the—substantially in the business for doing, is getting the fees from their workers.  That‘s why they unionize.

And also, from their point of view, to advocate for workers.  Most workers don‘t want to belong to unions, and that‘s the political reality of America in the late 20th and beginning of the 21st century. 

SHUSTER:  Richard, how is the White House going to handle this?

ROBINSON:  And David, I think you make a very good—you  make a great point about the salaries, especially in the companies that are being bailed out by the TARP, these enormous salaries, $4 billion in bonuses from Merrill Lynch.  I think if the union movement ever needed a big advertisement, it would be what‘s happening with this executive pay.  And I think that is something that American workers, not just those who belong to the unions, can relate to and can understand and can get angry about. 

BLANKLEY:  Look...

(CROSSTALK)

SHUSTER:  Richard, how is the White House going to handle this?

WOLFFE:  I think the White House—the people around Obama saw the unions

were critical in delivering the states that really mattered, that any

presidential candidate and party has to win—in Ohio, in Pennsylvania,

and in Michigan.  Tony‘s right, the unions have now declined.  But right

now, they‘re important in those key states.  And in this economy, you have

got to side with people who need the help, and siding against management is

you know, this is a candidate who said he wanted a Department of Labor, not a Department of Management.  They think there is no downside here. 

(CROSSTALK)

SHUSTER:  Go ahead.  Yes, go ahead, Tony.

BLANKLEY:  If I can just get in one second—in a world economy, where we‘re pressured by wages abroad, the idea of raising wages in America to an uncompetitive level with the rest of the world doesn‘t create higher wages, it destroys jobs. 

SHUSTER:  Tony, I want to circle back to something we started the show with, and that is Michael Steele, the new RNC chairman. 

Here‘s what Michael Steele said to Tavis Smiley in February of 2008, at a mostly African-American conference: “I‘m very proud to see Barack Obama do what Barack Obama has done and is doing.”

But then this summer Michael Steele told NewsBusters at the Republican Convention in September, “If he wins, if Obama wins, he‘s a media creation.  He‘s a brand.  America doesn‘t need a president who‘s a brand.  America needs a president who can lead.”

Does the Republican Party, Tony, need somebody who will essentially cater to the audience that he‘s speaking to? 

BLANKLEY:  Well, it‘s always useful to communicate with the people you‘re talking to. 

(LAUGHTER)

BLANKLEY:  I don‘t—I think we all understand that concept.  But look, both statements are true. 

Obama is a wonderful phenomenon, and Michael and the rest of the country admires what Obama‘s accomplished.  He is also a creation of a media that helped elect him.  Those are both correct statements. 

SHUSTER:  Tony Blankley, a pleasure, as always, having you on. 

BLANKLEY:  Thank you.

SHUSTER:  We love making you squirm, Tony.

Also, thanks to Eugene Robinson and Richard Wolffe.

BLANKLEY:  I didn‘t feel like I was squirming too much.

SHUSTER:  No, you handled that very well. 

Thank you all.  We appreciate it. 

In managing our government, transparency and public trust are crucial.  Keeping your word is also important, and that takes us to tonight‘s “Hypocrisy Watch.”  And I think Tony is going to like this one. 

According to Politico, the Obama administration has now hired more than a dozen people to top jobs in the administration who previously lobbied the U.S. government.  Several officials were lobbyists within the last two years. 

The list includes Agriculture Secretary Tom Vilsack; Deputy Defense Secretary William Lynn; Deputy HHS Secretary William Corr; White House Director of Intergovernmental Affairs Cecilia Munoz; and White House Political Director—White House Political Affairs Director Patrick Gaspard.  These officials and the others are all highly qualified and should be regarded as excellent choices.  Furthermore, the dozen or so lobbyists represent only a tiny fraction of the 8,000 people who have joined the administration. 

The problem is that during the presidential campaign, Mr. Obama said there would be zero lobbyists working for him. 

Watch. 

(BEGIN VIDEO CLIP)

OBAMA:  I am in this race to tell the corporate lobbyists that their days of setting the agenda in Washington are over.  I have done more than any other candidate in this race to take on the lobbyists, and I have won.  They have not funded my campaign.  They will not work in my White House. 

(END VIDEO CLIP)

SHUSTER:  They will not get—“They will not work in my White House,” as in not one.  That is a pretty broad and all encompassing pledge.  Furthermore, the president recently signed an executive order forbidding executive branch employees from working in an agency they had lobbied in the last two years. 

There‘s nothing wrong with the Obama White House admitting their campaign promises were too broad and therefore a mistake.  But until the Obama team makes that admission, the hiring of any lobbyists is hypocrisy. 

Up next on 1600...

(BEGIN VIDEO CLIP)

SEN. CLAIRE MCCASKILL (D), MISSOURI:  They don‘t get it.  These people are idiots.  You can‘t use taxpayer money to pay out $18 billion in bonuses.  What planet are these people on? 

(END VIDEO CLIP)

SHUSTER:  Fighting words from Senator Claire McCaskill, who has a new proposal for Wall Street.  If your company gets bailout money, your executive salary gets capped at $400,000. 

We‘ll talk to CNBC‘s Dylan Ratigan about that idea, as well as the corporate villains and heroes out there. 

This is 1600.

(COMMERCIAL BREAK)

SHUSTER:  Welcome back to 1600.

The Commerce Department confirmed today what many of you probably already suspected.  In the last quarter of 2008, the economy contracted at a faster rate than it has in decades.  President Obama spoke about the economic downturn this morning. 

(BEGIN VIDEO CLIP)

OBAMA:  The recession is deepening and the urgency of our economic crisis is growing.  Yesterday we reached a new threshold, the highest number of Americans receiving unemployment benefits on record.  Every day it seems there‘s another round of layoffs, another round of jobs lost, and families‘ lives turned upside down. 

(END VIDEO CLIP)

SHUSTER:  The recession has corporate causalities as well, of course.  For the first time in eight years, Detroit‘s big three will sit on the Super Bowl sidelines, opting out of buying ad time.  And that‘s just one example of the money that won‘t be spent in Tampa Bay this weekend. 

PricewaterhouseCoopers estimates that $150 million will be spent by visitors, down from $200 million in Phoenix last year.  And corporations are scaling back on their game day parties. 

But despite the ongoing recession, some companies are still making record profits.  ExxonMobil shattered the record to become the most profitable U.S. corporation ever last year.  Today it reported $45.2 billion in profits, despite the yearend plunge in oil prices.

Joining us now is Dylan Ratigan, anchor of CNBC‘s “Fast Money.”

Dylan, it certainly feels like the gap is widening between the haves and the have-nots.  Is that accurate?

DYLAN RATIGAN, ANCHOR, “FAST MONEY”:  Absolutely.  I want to go directly at the sound bite that you played coming in here, which is a suggestion of the $400,000 cap on CEO compensation. 

Here‘s my concern.  If you believe that capitalism is good for America, if you believe that a small businessman or a big business‘ ability to take risks and reap the rewards of that risk-taking is the best way to create creativity and innovation and growth and new ideas in health care solutions and energy solutions in this country, which I actually think most people do, you have to understand that what happened in New York with the bankers was not capitalism.  It was a total corruption of the capitalist system fostered by legislation pushed for by lobbyists in Washington, D.C.  Those lobbyists paid by the bankers. 

Why is that?  The bankers were able to create a structure that allowed them to take risk that really was risk that has been stuck with us, the taxpayer, while they kept the bonuses. 

The outrage should be with Congress and their willingness to allow those laws to come to be, obviously with the bankers for being so stupid as to think they could continue to get away with this.  But it would be a tragedy for this country if we allowed this idiocy, the bad legislation, the bad sister of legislation, and the greedy and really foolish bankers here in New York to corrupt the way we look at capitalism as it serves the balance of our country. 

There is a huge difference between a series of laws that allow a banker in New York to sell insurance on a home loan and then stick the taxpayer with the losses and a cap on somebody‘s salary just because they made too much money.  Those are very different things. 

SHUSTER:  Well, I want to give you viewers a taste of what the atmosphere is like here in Washington.  Here‘s Senator Claire McCaskill, who introduced this legislation on the Senate floor to cap corporate salaries for bailout recipients. 

Let‘s listen. 

(BEGIN VIDEO CLIP)

SEN. CLAIRE MCCASKILL (D), MISSOURI:  These people are idiots.  You can‘t use taxpayer money to pay out 18 billion dollars in bonuses.  You want the people at your financial institution to have a job tomorrow?  Then you‘re going to have to limit everyone‘s pay at your company to the same salary that the president of the United States makes. 

(END VIDEO CLIP)

RATIGAN:  I‘ll add to that.  David, these banks would be bankrupt already.  The big argument is, we‘ve got to pay them for the franchise; we‘ve got to protect the franchise.  I‘ll tell you what, they should have thought about that before the CEOs at the banks ran the banks into the ground.  The U.S. taxpayer has no responsibility to protect some banker‘s franchise, any more than he does to protect my franchise hosting a TV show, or anybody else‘s franchise, running a barber shop or shoe store.  It‘s insulting.

Again, you‘ve got to be careful not to mix up people who make a lot of money because they‘re good at something and people who corrupt the system to steal money, because they‘re good at lobbying Congress. 

SHUSTER:  Give us some examples of both.  Who are the people who deserve the money?  Who are the people who don‘t, or who don‘t deserve the money and have recognized that? 

RATIGAN:  Sure.  Those who deserve the money are anybody who works for a living, anybody who has ever started a business, or anybody who‘s ever created something in a group or on their own, without anybody else‘s help.  I don‘t care what it is, if you work as a janitor or if you‘re Mike Bloomberg, if you‘re Richard Branson, if you‘re Bill Gates; those people created businesses.  They created jobs for other people.  The blue-collar worker goes in, creates value for that company and walks out with a paycheck. 

The difference between all those other people, David, and these bankers is that the bankers basically started an insurance scam, enabled by the U.S. government, and then had the benefit of a former banker in the form of Hank Paulson to help them cover up their mess.  Somebody who sticks the risk, the consequences of their bad decisions with somebody else, which is what the bank CEOs have done, Stan O‘Neil, an obvious one, built Merrill Lynch, runs it into the ground, pays himself 160 million dollars.  The company loses eight billion.  They go to the government for money.  That is outrageous.  We should able to claw back that bonus.

I can go down a list of people.  Look at AIG.  They were insuring every credit loan, every home loan in America, collecting all the insurance money.  But then when the insurance claims came in, they didn‘t have any money, so they stuck it with the taxpayer.  It is not a crime to make a lot of money.  It is a crime to steal a lot of money.  We should make a distinction between those who are effectively bank robbers and those who are actually capitalists. 

SHUSTER:  We‘re going to find out whether Senator McCaskill and her colleagues in the Senate is listening, because we‘re going to be talking to them about this next week.  Dylan Ratigan, anchor of cNBC‘s “FAST MONEY,”  Great stuff, Dylan.  Thanks, as always. 

RATIGAN:  See you soon.

SHUSTER:  Up next, our continuing series on Ground Zero.  The Port Authority of New York and New Jersey is responsible for the site and the rebuilding efforts.  We‘ll talk to the executive director straight ahead. 

And Turkey‘s prime minister received a hero‘s welcome when he returned home from the World Economic Summit in Davos, Switzerland this week, all because he threw a temper tantrum and stormed out of a discussion.  More 1600 after this.

(COMMERCIAL BREAK)

SHUSTER:  Welcome back to 1600 PENNSYLVANIA AVENUE.  We‘ve been talking all week at this time in our show about the fierce debate over Ground Zero in New York, and how our nation should reclaim the can-do spirit of those who worked and died there. 

Joining us is Christopher Ward, executive director of the Port Authority of New York and New Jersey, the government agency responsible for the rebuilding at Ground Zero. 

Mr. Ward, thank you for joining us.  Before I throw some questions at you, I want to start by giving you some credit that you deserve.  The underground—this is to help our viewers.  The underground transportation hub and the ground level 9/11 memorial are coming along.  You‘ve made progress on those issues, where others have failed.  So congratulations. 

The key issue, at least for us, is the dispute over which set of office towers should be built along side the ground level memorial.  Again, to help our viewers, here is the latest video of the Freedom Tower office building plan.  We can see concrete and construction going about 30 feet above ground level.  This is the artist sketch of what the Freedom Tower is supposed to look like when completed. 

And here is a Twin Tower design embraced by many 9/11 families.  Again, both plans incorporate the transportation hub and the ground-level memorial.  So let‘s focus on the office tower dispute.  Christopher, as you know, a strong majority of the 9/11 families want the Twin Towers, not the Freedom Towers.  Same with New York police and firefighter organizations.  In our own online poll this week, involving nearly 900 respondents, 93 percent want the Twin Tower plan; seven percent the Freedom Tower plan. 

My first question is, does the public view matter? 

CHRISTOPHER WARD, PORT AUTHORITY OF NY AND NJ:  Well, I don‘t know where you got that polling from.  This project has been going on in New York City obviously quite some time.  There was a broad public consensus that brought together the plan we are, in fact, building today.  And as your introduction made clear, the One World Trade Center is going up.  We are building the memorial.  We are building the transit hub. 

But all of these are part of one large project, integrated into a single downtown community.  So for people to now talk about an opportunity to bring back another plan, we are beyond that debate and we are now—what we are not debating is the need to build downtown. 

SHUSTER:  I get your point, except that the Twin Tower plan was never allowed to be introduced as part of the whole process years ago.  Again, the Twin Tower plan would incorporate the transportation hub and the memorial.  Again, here‘s another issue.  The Freedom Tower apparently hasn‘t received any corporate tenant commitments.  A big potential one pulled out recently.  I know that there are negotiations involving a government agency that may rent some space. 

If the market has decided against the Freedom Tower design and rent, why should any local, state, or federal government agency, on behalf of taxpayers, buy into the Freedom Tower? 

WARD:  First of all, I don‘t know about any tenant that has pulled out.  In fact, we do have private sector tenants who have signed a letter of commitment.  We also have a commitment from the federal government as well as the state government to take just a portion of that building.  This will be a class-A office space in downtown, the largest structure in New York City, a green building. 

We believe this is going to meet the market at the right time and allow other private tenants augment what we already have as critical base tenants for the financing of that overall iconic structure. 

We‘re confident with the construction we have to date, the speed with which it‘s being built, that both the governmental, the private tenants, which I mentioned before.  Then when the real estate market comes back, as we know it will, that tower will get filled. 

SHUSTER:  We look forward to hearing who the private tenants are, because that doesn‘t seem to be public knowledge.  We haven‘t found any.  That‘s another issue.  Here‘s the larger issue that I think so many 9/11 families have.  This was expressed by Twin Tower engineer Ken Gardner, who was on our show earlier this week.  Watch.

(BEGIN VIDEO CLIP)

KEN GARDNER, ARCHITECT:  This symbol is to recognized in countries around the world, in every culture and every language.  This is an opportunity to show the world that the boldness of America, the boldness and strength of this economy is back. 

(END VIDEO CLIP)

SHUSTER:  Again, he‘s talking there about the Twin Towers.  Do you really believe, Christopher, that, in your heart of hearts, that the Freedom Tower plan is the proper way to remember—the proper way, the proper response to terrorists who hated America‘s can-do spirit, as represented by the Twin Towers? 

WARD:  I think most important thing to recognize, which wasn‘t said,

is the most important thing we‘re building is the memorial, that beautiful

state which will allow the city, the state, the nation to gather and to

remember exactly those terrible attacks.  That‘s why the notion that you

could bringing the Twin Tower backs, take out almost four billion dollars

worth of infrastructure that‘s already been built, you know, tear that out

--

SHUSTER:  Four billion dollars?  I‘ve heard about a billion dollars. 

Maybe you can provide publicly how the four billion dollars is spent.  Nobody else seems to know.  Again, the issue—you‘re right, the memorial is terrific.  It‘s going to be a magnificent memorial.  The question is, do you want a memorial people that walk under the ground to, which is the 9/11 memorial, and that‘s fine?  Or do you want a memorial that says, you know what, the Twin Towers were icons recognized around the world?  The Freedom Towers is a design that‘s not recognized around the world, and a lot of people, frankly, don‘t like. 

WARD:  Look at the history of the city of New York.  The city of New York rebuilds itself every 25 years.  The amount of beautiful architecture that we‘re bringing back to the site, recognizing what the World Trade Center was before, is the new vision for downtown.  Not only will you have the Freedom Tower; you‘ll have three beautiful buildings designed by three of the greatest architects in the world, recreating a new vital downtown, speaking to the past, but perhaps more importantly, leading us forward in a way that is rejuvenating, which is of a rebirth, which will bring the financial services industry back to downtown, will be part of a 24/7 integrated community. 

We don‘t need to always look back to remember what happened to the United States and what‘s happened to New York City.  Sometimes we actually have to look forward. 

SHUSTER:  Right, except looking forward, Christopher, when you build four different buildings, different sizes and shapes, that costs a lot more than building two Twin Towers that are essentially mirror images of each other, and that have economies of scale. 

WARD:  There was much debate about what would be going on downtown, how would you build it?  What would the cost estimates be?  We have a plan now.  This is the important thing.  We have to plan now that can be built.  We need to move on.  We have a design.  We have a construction team.  We have a commitment.  We have funding. 

The key thing is to make sure downtown comes back as quick as possible. 

SHUSTER:  Isn‘t the key thing to remember what the 9/11 families want, what the police want, what the firefighters want?  So many people said, you know what, the Twin Towers were icons.  If America wants to say we‘re back, let‘s build the Twin Towers.  And, again, you mentioned four billion dollars that‘s been spent.  How is that possible?  Because when you look at the site, there‘s nothing really there.  There‘s some building about 30 feet off the ground and there‘s a lot of stuff underground.  Four billion dollars for that? 

WARD:  You have to understand that when I said four billion dollars, we had to take that site, excavate it, build temporary pass stations, create the system that allows these buildings to get now built.  We‘ve already purchased almost 1.4 billion dollars of one World Trade Center. 

I want to come back to the fundamental question you asked, in terms of whether or not the architecture of the World Trade Center is the only way to remember this site.  It can‘t be the only way to remember the site, in the same way that New York has rebuilt itself time and time again.  The point of this plan is that it integrates a community, a memorial, a real estate and a financial industry that must return. 

I think if you look at where New York City will be 20, 30 years from now, we will look back proudly and see what actually got built there. 

SHUSTER:  It‘s a great point you make, Christopher.  Again, congratulations on the memorial.  Again, the memorial would be part of the Twin Tower site.  I—

(CROSS TALK) 

SHUSTER:  Let me finish and you can make a point.  If somebody burned down the Capitol, if somebody burned down the White House, we wouldn‘t redesign the Capitol with modern architecture.  We wouldn‘t rebuild the White House and make it a different color. 

WARD:  In that case, I think you‘re dealing with, you know, national monuments, as opposed to real estate—

SHUSTER:  Weren‘t the Twin Towers worldwide monuments, a symbol of American capitalism and the can-do spirit?  Maybe we disagree on that—

WARD:  I want to go back to one important thing.  You can‘t have the memorial where it is, what it will be and bring back the Twin Towers.  You just can‘t do that.  I also want to—

SHUSTER:  Well, the designer of the Twin Tower plan, Christopher, says you can.  He says he showed you the plan and said you can keep the 9/11 memorial as it is and build the Twin Towers around it. 

WARD:  You can‘t.  This is one project.  This is not discrete projects.  The steel, the beautiful reflective pool, the water fall—it sits right in the middle of the site.  You can‘t simply take everything else out and now expect that you can drop in the old footprints of the Twin Towers.  It‘s not physically possible.  And I think—

SHUSTER:  His plan, though, keeps the footprints and, again, builds the Twin Towers essentially catty corner to them, and again, away from the West Side Highway.  You would be able to have windows and floor to ceiling glass, as opposed to the Freedom Tower, I understand, is going to essentially have no windows up to the tenth floor, because it‘s so close to the West Side Highway? 

WARD:  The Freedom Tower has a beautiful base of crystalline glass that‘s going to be surrounded by the trees, mirroring the trees on the memorial.  The iconic structure that we will have there will be a symbol, exactly like the Trade Centers were before, of downtown, of the strength of the real estate industry, of the certainty of the financial markets here in Lower Manhattan. 

I think this is the vision that took many years to put in place.  The key thing now is to not doubt, not look back, to make sure we‘re building and going forward.  That‘s been my mission and that‘s what the Port Authority‘s mission is now. 

We can‘t wait any longer.  The debates are behind us.  We have a plan.  We think it fits with all of what Lower Manhattan needs, what the city and nation needs.  And that‘s what we‘re building. 

SHUSTER:  Christopher Ward, good of you to joins us; 9/11 families obviously have a different view and so do the rest of us.  But in any case, good of you to join us.  You‘re a very articulate spokesman for what you‘re trying to do down there.  We appreciate you coming on. 

WARD:  My pleasure. 

SHUSTER:  Does age really matter?  Up next, we‘ll take a closer look at the new crop of 20 somethings who are invading 1600 PENNSYLVANIA AVENUE. 

Plus, President Obama has invited members of Congress over to the White House to watch the Super Bowl.  Who are some of the lucky ones on the invite list?  More importantly, what does one bring to a presidential Super Bowl party?  More 1600 after this.

(COMMERCIAL BREAK)

SHUSTER:  We‘re back with a look inside the Briefing Room.  Clearly, change has come to the White House.  The Obama team is much younger than the previous Bush squad.  More than a few 20 somethings now have access to the West Wing.  John Favreau is the president‘s speech writer.  He began writing for then Senator Obama back in 2005.  He‘s 27 years old. 

Sam Kass is an assistant White House chef.  He used to be the Obama‘s family personal chef back in Chicago.  He‘s 28.

Josh Dubois is the director of the newly created Council for Faith Based and Neighborhood Partnerships.  He‘s 26. 

Reggie Love is a personal aide to the president, or what‘s known as the president‘s body man.  Anywhere the president goes, so does Love.  He‘s 26. 

Eugene Kang is a special assistant to the president.  He works in the Executive Office of the President, and his duties are similar to a personal secretary.  He‘s 24. 

Then there‘s Peter Orszag, senior statesman on this list, as the administration‘s budget director.  Peter‘s responsibilities include keeping track of trillions of dollars.  He is 41. 

It has been just about 24 hours since Illinois lawmakers removed Rod Blagojevich from office.  State signs on the highways are already being changed.  Crews were spotted earlier today in front of just one of the 32 blue signs.  The toll-way spokesman says the plan is to keep the signs up, but cover up the former governor‘s name with the name of the toll plaza.  The signs were first put up in 2004.  Officials say the total cost to change all 32 signs will be 480,000 dollars. 

The Super Bowl, as you know, is this Sunday.  President Obama has invited members of Congress to join him at the White House to watch the game.  Here‘s where the RSVPs currently stand.  The Steelers contingent will Senators, Bob Casey and Arlen Specter, as well as Congressmen Charlie Dent, Mike Doyle, and Patrick Murphy.  Senator Casey says he‘s bringing along a Terrible Towel to wave at the TV and taunt Cardinal fans.  Congressman Doyle is bringing some Iron City Beer. 

The Arizona cardinals faithful will include Congressman Trent Franks and Raul Grijalva.  We heard Senator John McCain was invited, but was not and able to attend. 

And to those whose allegiance is just unclear; from the Senate, Illinois Dick Durbin and Minnesota‘s Amy Klobuchar.  From the House, Maryland‘s Elijah Cummings, Alabama‘s Artur Davis, Connecticut‘s Rosa Delauro, New Hampshire‘s Paul Hodes, DC‘s Eleanor Holmes Norton and Michigan‘s Fred Upton. 

One thing that we do know, President Obama and Vice President Biden have both already said they will be pulling for Pittsburgh. 

With the economy in crisis, Wall Street bonuses are unheard of, right?  Wrong.  Up next, our Muckraker of the day reports that more than 18 billion dollars of bonus pay went to the financial industry, even as the industry was collapsing.  The unbelievable story when 1600 continues. 

(COMMERCIAL BREAK)

SHUSTER:  Welcome back to 1600.  It‘s the story heard around the world, the report about Wall Street bonuses in the “New York Times” has stirred outrage all across Washington and much of the nation.  “Despite crippling losses, multi-billion bail outs and the passing of some of the most prominent names in business, employees at financial companies in New York, the now diminished world capital of capital, collected an estimated 18.4 in bonuses for the year, the sixth largest hall on record.” 

Ben White wrote that story for the Times and he‘s our Muckraker of the day.  Ben, congratulations.  Great work.  Have you been surprised at all?  President Obama has referred to the story.  Joe Biden has referred to what you‘re talking about as shameful.  You surprised at all? 

BEN WHITE, “THE NEW YORK TIMES”:  Not terribly surprised.  It‘s always nice to get a reaction to a story.  Don‘t necessarily expect the president of the United States to cite it in a press conference.  That was certainly gratifying.

But the number is big.  A lot of people sort of miss the point.  I think they saw a 44 percent drop in bonuses from last year and took that as the lead of the story.  That was from a very high base last year.  And the number this year, the 18 billion, is still the sixth highest ever, in a year when losses on Wall Street were at least 35 billion, probably more than that.  We‘re getting hundreds of billions, trillions of dollars in government bailout money.  You see Bear Stearns sold, Lehman Brothers go into bankruptcy, Merrill Lynch sold, Goldman Sachs and Morgan Stanley become bank holding companies. 

So it doesn‘t actually surprise me that is sparks a lot of outrage that this kind of money is still getting spread around on Wall Street. 

SHUSTER:  Ben, how on Earth were these corporations justifying these bonuses? 

WHITE:  You know, they justify them by basically by saying we have performance metrics that we use.  If you hit a certain revenue target, you get a bonus.  A lot of it is discretionary and they claim that they need to pay this money in order to retain employees.  This is at a time when Wall Street firms and, you know, commercial banks are laying off huge numbers of people.  That argument rings just a tiny bit hollow to most people, the idea that somehow you need to pay somebody a six-figure bonus to keep them, when, in fact, there are layoffs all over the place. 

so There really is no justification.  It‘s somewhat of an outrageous number. 

SHUSTER:  Do you get the sense that these firms recognize just how infuriated the country is?  We‘ve seen the legislation introduced in the Senate to curtail the bonuses, especially to companies that got Wall Street bail outs?  People are so mad.  Do the sense in your reporting that corporations get that? 

WHITE:  No, I really don‘t.  In fact, I get the opposite.  I get a lot of feedback from people on Wall Street saying they think their bonus is too small this year and that they deserve more.  I think maybe at the highest level at the firms, they get it, the CEOs, the types at Goldman Sachs and elsewhere who forego bonuses for the year.  They kind of get it.  The rank and file don‘t necessarily get it. 

Wall Street operates in a different world than anyone else.  I don‘t think—

SHUSTER:  Ben, your reporting is head and shoulders above everybody else. 

WHITE:  Appreciate it. 

SHUSTER:  Congratulations on being our Muckraker of the day.  Great story.  Ben White of the “New York Times.”  That is our view from 1600 PENNSYLVANIA AVENUE tonight.  I‘m David Shuster.  We‘ll see you back here Monday, same time, 6:00 pm Eastern.  Remember, go to 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.

END   

Transcription Copyright 2009 CQ Transcriptions, LLC  ALL RIGHTS  RESERVED.

No license is granted to the user of this material other than for research.

User may not reproduce or redistribute the material except for user‘s

personal or internal use and, in such case, only one copy may be printed,

nor shall user use any material for commercial purposes or in any fashion

that may infringe upon NBC and CQ Transcriptions, LLC‘s copyright or other

proprietary rights or interests in the material. This is not a legal

transcript for purposes of litigation.>

transcript

Discuss:

Discussion comments

,