updated 2/9/2009 11:27:31 AM ET 2009-02-09T16:27:31

Time:19.00

Guest: Pat Buchanan, Lynn Sweet, Ron Brownstein, Martin Kady, Andrea Mitchell, Mike Viquiera

CHRIS MATTHEWS, HOST:  Looks like a deal.  Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.

Leading off tonight, there could be a deal.  Right now, the Democratic caucus is meeting to consider a reduction in the president‘s economic recovery plan down to $780 billion, down from over $900 billion.  Senator Harry Reid, the Democratic leader, is making case to his fellow Democrats that they should go with getting 90 percent of what they need and not let the bill get beaten by the absence of the 10 percent extra they‘d like to have.

There was some opposition in the caucus, on the left, on the liberal side, to accepting a compromise.  We‘re in a waiting position right now for a press conference to be held by two senators in the middle, Susan Collins of Maine, a Republican—who‘s just re-elected in Maine and won‘t get defeated for a long time if ever—and Ben Nelson, a conservative Democrat from Nebraska.

At any moment, they‘re going to hold a press conference to explain this compromise deal which looks to be in the works, which could lead to a vote tonight to get, perhaps, 60 votes which is necessary to avoid a filibuster and to get the stimulus package on the road to victory.

Let‘s get the latest from NBC‘s Mike Viqueira.

What broke?  How the ice gets broken today, Mike?

MIKE VIQUEIRA, NBC NEWS CORRESPONDENT:  Well, these two senators plus about 14 of their colleagues were behind closed doors all week in a series of meetings.  Their goal is to reduce that $920 billion stimulus package, the most expensive bill in the history of this republic, Chris.  They wanted to take about $100 billion off a “haircut,” it has been termed.  But it‘s been something of a more severe haircut now, bringing it down to about $780 billion.

A lot of the argument here has been, of course, what is

stimulative, what is not stimulative?  What is going to help the economy in

the short-term, which has been the stated reason for having this massive,

this colossal bill to begin with and what is worthy cause—for example,

spending on the pandemic flu, the National Endowment for the Arts, some

education spending, right on down the line.  What can be put off to a later

date because this bill was so large, and because these members of Congress

both in the Senate and House—sense there is a lot of anxiety around the country about the amount of money that Congress has been throwing around since last September, when the large bailout package was passed, and now talk of a new bailout package.  That‘s what gave everybody cold feet.

       

Plus, you look at the hard core Republican caucus, their conference led by conservatives.  This bill has been tailor made for them, the large spending items; they are trying to rediscover their fiscal conservative mantle.  They have opposed this bill in the House unanimously and very solid cores of Senate Democrats have opposed it as well.

But now, these moderates have come together.  There is this tentative deal.  This is one step in the process.  This does not mean the stimulus package is going to pass Congress tonight or this weekend or even next week.  They have to get back together with the House and reconcile these two measures assuming they go forward.

We should also watch the Senate floor here.  We could see Harry Reid announcing his intentions.  There are indications at this moment as we wait for this meeting to break, that they will allow a vote to go forward tonight on a compromise amendment.  This is the amendment that would trim this bill down to $780 billion, Chris.

MATTHEWS:  Will that compromise amendment require 60 votes or 50 votes?

VIQUEIRA:  No, that would require .

MATTHEWS:  That being (ph) with the vice president voting.

VIQUEIRA:  No, that would require 50.  Final passage, however, would require a 60-vote majority if Republicans choose to filibuster this bill.  And right now, they have indicated that they have not seen what the bill is, they have not made up their mind.  They‘re holding their cards close to the vest at this point, Chris.

Whether or not they decide they have already made their points on this bill and go forward with requiring a filibuster, requiring a kicking in of what‘s the cloture clock, and then a vote perhaps on Monday remains to be seen.  We could see this out of a Senate and into a conference committee with the House as early as this evening, Chris.

MATTHEWS:  How many Republicans are going to join this?  It looks like you got Susan Collins, you may have Olympia Snowe, Arlen Specter of Pennsylvania, that‘s three.

VIQUEIRA:  Right.

MATTHEWS:  Who else are we looking at?  Martinez and Voinovich, right, Florida and Ohio?

VIQUEIRA:  Yes, exactly.  Although Voinovich, we are told, has left the negotiations.  And, Chris, we‘re hearing reports of another dramatic appearance possibly by Senator Kennedy.  Of course, stricken with brain cancer over the summer, he has been back and forth.  The last time we saw him in the Capitol was the unfortunate day for Senator Kennedy, of course, Inauguration Day when he had to be taken and attended to from the inaugural luncheon.

But it‘s that close, at this point, and they‘re talking about bringing Senator Kennedy into the chamber for this vote.  Democrats now have 58 with the situation in Minnesota unresolved.  They need every vote they can possibly get on this.

MATTHEWS:  Do you believe it makes sense—well, I can‘t ask you a question because it really requires political—well, first, vivacity (ph) of the kind none of us have perhaps.  Is it smart for the Republicans to filibuster a bill that has 58 or 59 votes short of the 60, and those votes include that of Senator Ted Kennedy?  Why would they want to have an all night sleeper or whatever it takes to filibuster these things, exposing themselves as obstructionists against the only president we have and the only stimulus package we have?  Why would they want to risk that and filibuster?

VIQUEIRA:  Well, I think that‘s the calculation they‘re trying to make right now.  Have they made their points—I mean, Republicans have to start from the beginning with their political base.  And let‘s face it.  Anything that goes through Congress of this magnitude, regardless of the fact that we‘re still almost two years away from election, is going to be seen in a political context.

MATTHEWS:  Yes.

VIQUEIRA:  They have to make a point—they have to make the point to their base that they are back on the path of fiscal responsibility.  They have to start from the beginning.  Have they made that point?  I think it can be argued that they have.  There has been so much attention, much to the dismay of Democrats, that Republicans in the Democratic view have gotten attention disproportionate to their numbers and influence, particularly in the House of Representatives.

Members of the House were extremely frustrated with the media, with Republicans, and even with the White House for saying as soon as that bill passed the House that it was going to be quote/unquote “strengthened” in Senate.  Well, what the heck was that supposed to mean, wondered a lot of House Democrats?  And that‘s part of the reason why you saw President Obama change that tone yesterday, culminating in the red meat speech down in Williamsburg, Chris, where he castigated Republicans and got back to this message of, “Hey, we won.”

And I talked to one or he held a brief press conference afterwards, Jim Clyburn, after that speech, he said, he, it has reminded him and reminded people across the country after that speech to the House Democrats last night of why they fell in love with Barack Obama to begin with.  So, the implications with that, perhaps, we fell out of him at some point.  But House Democrats were rapturous about that speech last night.  And perhaps there was some spillover into these negotiations today, Chris.

MATTHEWS:  OK.  Thank you very much for joining us.  Mike, we‘ll be back with you throughout the hour as we follow this vote.  It looks like it‘s coming to a head tonight.

MSNBC political analyst, Pat Buchanan, and Atlantic Media‘s Ron Brownstein are here with us.

Pat, it‘s great bit of theater here.  I don‘t see Jimmy Stewart, by the way, out on the floor there tonight.  I think that the Republicans have been winning some points.  They went after the contraceptives in the bill, they pointed out the Hollywood money in the bill.

Even John McCain is out there on the floor, making fun of something to do with lobster baiting or something on the floor of the ocean.  They‘re making their points that this is an imperfect package.  Are they‘re going to win on this if they join in enough to pass it?

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  Well, they‘re recapturing the flag of fiscal responsible that they lost under George W. Bush.  So, they‘ve done an outstanding job on that.  They‘re united as Republicans, can unite conservatives, can unite .

(CROSSTALK)

MATTHEWS:  Don‘t you enjoy opposition where the government .

BUCHANAN:  Well, we really enjoy a fight on principle and philosophy, head-to-head against the Democratic Party.  They love it.  They live for that.

Now, you make a good point though.  If you filibuster, what is the purpose?  There is only one purpose it seems to me.  This is going through some one form or another.  Improve it once more, beat them, and improve it once more, and then you let it go, I think.

MATTHEWS:  Don‘t obstruct.

BUCHANAN:  No.  I can see them going with one filibuster and then saying, “If you give us this, this, and this, we‘ll walk.”  So, they can go home and say, “We fought as well as we could, we‘re not obstructionists, we got as good a deal as we can out of there,” and that‘s where .

(CROSSTALK)

MATTHEWS:  How long would you play that tough game and hang out route, two days, three days?

BUCHANAN:  I would make sure the whole country saw what we were doing as a party.

MATTHEWS:  Yes, but just remember, we got a deadline here.

BUCHANAN:  Yes.

RON BROWNSTEIN, ATLANTIC MEDIA:  Yes.

MATTHEWS:  The president wants this on his desk by Washington‘s birthday.

BROWNSTEIN:  And the issue will be whether those Republicans from states where Obama was strongest, Maine, that he won it by 17 points, Pennsylvania that he won by 600,000 votes, are comfortable doing that.

Look—I agree with Pat, this whole debate has exposed.  From the beginning, I have felt that one weak spot in Obama‘s agenda was that it did not have a strong element of fiscal discipline.  Even as a candidate, he did not have the elements that Clinton had in ‘92 -- a promise to reduce the federal workforce or reduce the deficit.  And that has left some of the Democrats from where Republican-leading states in a difficult position.  After the election, they recalibrated this and said, “Look, we have to do this immense spending in the short term to get us out of this ditch.  But then, we‘re going to have a long term grand bargain on fiscal responsibility.”  That latter part of the message really has faded in these last two weeks.  He‘s allowed the Republicans to define this as fundamentally a spending bill.  And you know .

MATTHEWS:  There were so many cats and dogs in there.

BROWNSTEIN:  And the irony, of course, is that much of that is trivial compared to the overall size of it.  But there is—and the reason why it resonated was because there is a lot of long-term spending in here that reflects Democratic priorities of education and research but not necessarily .

MATTHEWS:  OK.

(CROSSTALK)

MATTHEWS:  Earlier in the night, I talked to the top senior adviser, the top adviser on communications, especially, David Axelrod at the White House about why the Democrats don‘t call the Republicans‘ bluff and demand that they filibuster.  Just pass it with 55 or 59 votes and say, “You want 60?  Test that with the public.  Here it is.”

(BEGIN VIDEO CLIP)

MATTHEWS:  You need six votes on the Republican side.  If you don‘t get the six, whose fault is it?  Is it the Republican Party for obstructionism?  Is it the Democratic leadership for going along with this need for 60 votes?  Why don‘t they just vote a majority up there and see—and dare the Republicans to oppose it?

I don‘t understand the tactic.  Why don‘t they just vote 51 or 54 Democrats?  Have the Republicans filibuster.  Go ahead, bring the cots in.  Stay up all night and point out the Republicans standing against the stimulus package.  What‘s wrong with calling their bluff?  I don‘t get it.  Call their bluff.

(AUDIO BREAK)

DAVID AXELROD, WHITE HOUSE SENIOR ADVISER:  Well, I‘m going to—man, you should be in the United States Senate.  I‘m not going to—I‘m not going to make—prejudge the tactics up there .

MATTHEWS:  Yes.

AXELROD:  . or what might happen down the line.  The fact is, there are a majority of votes in the United States Senate to pass an economic recovery package .

MATTHEWS:  Yes.

AXELROD:  . and begin the work of moving this country forward.

MATTHEWS:  Yes, there are.

AXELROD:  There are a minority.  They are a minority who are frustrating it now.  We‘d like to build the coalition and move this thing forward.  But what happens from this point on, we‘ll see.

(END VIDEO CLIP)

MATTHEWS:  This is high drama, whether you go for a filibuster, whether you‘d just say, “We‘ll play by the rules.”

BUCHANAN: Go for it.

MATTHEWS:  You go for the filibuster.

BUCHANAN:  Yes, cats and dogs.  You‘ve got cats and dogs.  Go up there in that podium, in that forum right there.  And each guy holds up a cat or a dog in this bill for .

(CROSSTALK)

MATTHEWS:  OK.  You said the Republicans went with a short term filibuster.

BUCHANAN:  Sure.  If David Corn says 100-to-1, the telegrams and calls are coming in on the conservative Republican side.  These guys are charged up.

BROWNSTEIN:  I think the Democrats are frustrated that, in fact, the Republicans have been winning the message argument to a large extent.  But there is a tipping point.  There is a danger.  I mean, the country right now is putting a lot of faith in Obama in part because the alternative is truly scary.

If you don‘t have faith in this president and this administration, to believing that they have a course to lead us out of this, you know, the other side of that is pretty scary.  And I think Republicans right now are at the risk of kind of overplaying what has been a well play hand.

MATTHEWS:  OK.  Suppose you need a car to get somewhere, right?

BUCHANAN:  Right.

MATTHEWS:  And the guy, he brings a car with the fin on and all this loaded stuff on, C.D.s, DVDs for the back seat, all this stuff.  You say, “I don‘t want that car, there‘s too much stuff on it,” but you still need a car.

BROWNSTEIN:  Right.

BUCHANAN:  You still need a car.

BROWNSTEIN:  Yes.

BUCHANAN:  But what these Republicans are going to do, they‘re going to say, “You‘re going to buy this stinking lemon?  Have you looked at the tires?  Have you looked under here, have you seen this?”

(CROSSTALK)

(LAUGHTER)

BROWNSTEIN:  I‘ll tell you, though, every Republican voted for, every Senate Republican voted for an alternative that was virtually all tax cuts and allows Obama to make his strongest argument that essentially what they‘re offering is more of what we‘ve seen over the last years.

MATTHEWS:  Was that (INAUDIBLE) tax cuts or rates cut?

BROWNSTEIN:  It was a rate cut.

BUCHANAN:  All tax cuts and nothing else.

BROWNSTEIN:  You know, a real quick point.  April 2001, George Bush comes in $1.6 trillion tax cut.  The House passes it, exactly as written.  Senate cuts it $450 billion.  He gets half of it back in conference.  Even if this is rollback, Obama does have an opportunity to recover some grounds.

(CROSSTALK)

MATTHEWS:  Here‘s Axelrod—I‘m sorry, Ron.  Here‘s Axelrod again on the political strategy when it comes to Republicans and what they‘re trying to do from it all the way.  This is the top thinker in the White House with this kind of stuff—David Axelrod, tonight.

(BEGIN VIDEO CLIP)

AXELROD:  I think those who fail to act, those who want to turn back the clock, I think, put themselves in some jeopardy.  But we‘re not trying to get into a political contest over this.  We‘re trying to move the country forward.

The president—and, by the way, the president does believe that we should have dialogue over these issues.  He‘s had conversations with Senator Snowe and others.  I think he believes that there‘s value in talking.  But the time for talk is now done.  We need to move this thing forward.

And if anybody needed a wake-up call, I think the statistics this morning, (AUDIO BREAK) 600,000 people lost their jobs last month, 3.6 million in the last 13 months ought to be that wake-up call.

(END VIDEO CLIP)

MATTHEWS:  Let‘s go to Mike Viqueira on the Hill.  It looks like the deal is set.  Here‘s Mike.

VIQUEIRA:  Well, just real quick, Chris.  I‘ve got an e-mail here.  The Democratic—part of the question here was, Ben Nelson took this deal that he entered into with Susan Collins and that group, that rump group of Republicans and Democrats.  He took it into the Democratic caucus.  And that‘s where we see that stakeout camera outside the Senate chamber, outside the caucus meeting.  And he tried to sell it to them.

Would they accept deals in education, for example?  And a lot of people had voiced, within the Democratic caucus on both sides of the Capitol, had voiced opposition to the cuts in some of the places they were talking about making cuts.  Nancy Pelosi calls it doing violence to the future and then she told Harry Reid that—and the president of the United States that today.

However, I am told now that the caucus, by and large, has accepted this deal which means that Harry Reid likely now will try to put this deal on the floor tonight, put this amendment on the floor tonight, and we‘re likely to see a vote on this amendment.  And that would clear the way for final passage.  And again, the only question on final passage is: Will Republicans try to filibuster and start that cloture, that procedural clock and put this off until Monday or will they just get it out of the way tonight?

MATTHEWS:  You think we got 60 votes here from the looks of it?  If you throw the rump bipartisan group led by Susan Collins and by Ben Nelson, throw their 12 or 14 members on top of the Democratic base, do you got 60 votes?

VIQUEIRA:  Sure.  But I don‘t think they‘re going to bring 12 or 14 Republicans.  I mean, I think .

MATTHEWS:  I mean, total (ph) to 14 now, I said 12 to 14 in the bipartisan group including five or whatever Republicans, is that enough?

VIQUEIRA:  Yes, I‘m looking at a wire story here.  And, obviously, I‘m not in the Senate chamber, outside the Senate chamber.  Senior Democrats say they have about three Republicans.  And that‘s probably going to put them at the bare minimum at 60.

MATTHEWS:  I love the way they say about three.  We‘ll right back with Mike Viqueira.

VIQUEIRA:  Yes.

(LAUGHTER)

MATTHEWS:  This is fine tuning.  Mike Viqueira, stay with us.  Pat Buchanan, Ron Brownstein.  More on the deal tonight—deal or no deal?  That‘s the question tonight.  It‘s a great NBC question, by the way.  We‘re talking about $780 billion compromise pare down from $900 billion.  Plus, the liberals are giving in, the moderates and the middle seem to be calling the shots—fascinating politics and policymaking here in Washington.

You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with MSNBC political analyst Pat Buchanan, and the Atlantic Media‘s Ron Brownstein.

It looks like a possible deal is in works in the next couple of minutes, which brings to mind that sometimes we have a lengthy political process.  You elect Barack Obama.  You elect a majority of Democrats.  Who makes the calls?  The middle of the road people—the Arlen Specters, Susan Collins, the Ben Nelsons—the conservative Democrats and liberal Republicans.

BROWNSTEIN:  The model expectation that requires 60 votes to pass anything in the Senate.  It gives enormous power to those last few marginal members.

(CROSSTALK)

BROWNSTEIN:  Absolutely.  And, you know, and we are seeing it here again.  But I would just point out, this is not necessarily in the process.  As I said very quickly before, Bush‘s tax cut was trimmed by $450 billion in 2001 by the Senate.  He recovered half of that back during the conference.

And so, you know, there‘s going to be more discussion about what exactly is in here.

BUCHANAN:  Right.

BROWNSTEIN:  The Republicans have had one legitimate complaint, here, that the Democrats have been using this as a vehicle to try to advance some long-term goals (INAUDIBLE) stimulus.  What the Republicans really have not had, though, is a legitimate alternative that is something different than the economic policy .

(CROSSTALK)

MATTHEWS:  Here‘s—sorry, Ron.

BROWNSTEIN:  No problem.

MATTHEWS:  Here‘s Senator Reid, the Democratic leader.

SEN. HARRY REID, (D) SENATE MAJORITY LEADER:  Crisis gets worse, lending freeze is still upon us, small businesses are shutting down as we speak, job losses are significant this month, alone.  That is the month of January, 600,000 jobs.  And the month of February is starting to be even worse than January as far as layoffs. 

In Nevada, the unemployment rate has gone well over 9 percent.  Leading economists are comparing today‘s crisis to the early days of the Great Depression.  Now, Madame President, we‘re doing everything we can to make sure that this severe recession we‘re in does not become another Great Depression.  And we‘re a long ways from a Great Depression.

Great depression, stock market dropped 89 percent, 25 percent of all Americans were unemployed, millions of other were underemployed.  But we do not want this recession we‘re in to march into a depression.  And that‘s why we have worked all week to come up with a solution to the problems, to try to help jumpstart this economy.

This Obama plan, he acknowledged, himself, it wasn‘t perfect.  I have to be very candid with everyone here.  I‘ve learned a lot the last few days by people coming in good faith, saying what is in here should not be in here.  And on a few occasions, in listening to what was propounded by those who have come up with this bipartisan agreement, we had to swallow real hard.  But it was all done in good faith.  This is a very critical juncture in time.

MATTHEWS:  Well, there‘s Senator Harry Reid, of course, the Democratic leader admitting that there are elements in this stimulus package which are not essential to the economic stimulus program needed to, as he put it, jumpstart the economy.  Quite an admission by a very tough customer, who many people consider very partisan.

Let me go to Andrea Mitchell for the White House strategy.

Andrea, Rahm Emanuel has been up on the Hill tonight.  Is there a deal cooking involving the White House in terms of accepting something less than what they wanted initially?

ANDREA MITCHELL, NBC NEWS CORRESPONDENT:  Absolutely.  If Harry Reid is standing on the floor of the Senate and saying that they have a deal, this is a deal that is going to be acceptable to this White House.  They need something.

They don‘t want the markets opening on Monday morning without a deal.  They got Tim Geithner in the box coming out Monday with the second, big, hundreds of billions of dollars of bailout and insurance guarantees for the banking system.  And then the housing deal to come.

So, they‘ve got to get this out of the way.  They have to announce an agreement.  And you then got the president going to the country, as you know, in Indiana and in Florida, going to “ground zero” of unemployment areas and trying to sell this to the country in campaign modes, Chris.

MATTHEWS:  Who put together the package that is now so troublesome?  In the House, it was Nancy Pelosi and Dave Obey, the chairman of the appropriations committee.

MITCHELL:  Right.

MATTHEWS:  But now, we‘re finding that the Senate isn‘t even happy with its own package that the Senate, itself, put together.  Who are the grand designers of these packages who now have to play defense?

MITCHELL:  Well, it was not the White House.  But clearly, Susan Collins and Ben Nelson and that group of moderates, the gang of whatever—again, trying to forge compromises.  And that‘s why when Robert Gibbs said less than a week ago that this is only, you know, the third inning or whatever the baseball analogy he used, they all along thought they were going to have to change it in the Senate and that they could work together with like-minded people in the Senate to come up with some kind of compromise.

And this won‘t be perfect either.  But this is going to be very close to what ends up being agreed upon because—they keep talking about going to conference.  In your day and mine, up there, we used to think of conferees being appointed.  They don‘t have time for that.  There are going it be two conferees: Nancy Pelosi and Harry Reid.

MATTHEWS:  And so, next week, during the week, the tough fight will

be between two people, the leader of the House and the leader of the Senate

.

       

MITCHELL:  Right.

MATTHEWS:  . trying to reconcile these two measures which are enormous in terms of spending, the kind of spending like ten-fold what Congress usually spends when they put a bill together.

Andrea, the question here is—is Barack Obama learning to play this game?

MITCHELL:  I think what you‘ve heard is that he and Rahm Emanuel both have learned some lessons here, and you have a, you know, former senator who knows something of the culture of the place, calling people individually.  So, he‘s much more actively engaged certainly than George W.  Bush ever was.  He is more Clintonian in that he is personally getting involved in that kind of negotiating.

And Bill Clinton, for a long stretches of his second term, was out of action in terms of hands on negotiating with the Hill, because he was playing defense on all of those other issues like impeachment.  This is a different game but they‘ve learned that they‘ve got to be more engaged.

I don‘t think it‘s fair to expect them to have crafted this bill

themselves.  They had to have the House coming up with it.  But the fact is

that in the future, they‘re going to have to be involved much earlier.

       

MATTHEWS:  Well, let me tell you.  We‘ve got a word here.  Senator

John Kerry came out and told the press.  I‘m picking up little tidbits here

that it‘s 42 percent tax cuts now, 58 percent spending.  That‘s almost a 50/50 split between the winners and losers of this last election, Andrea.  That‘s a pretty good compromise if you‘re a Republican, it seems to me.

       

MITCHELL:  Right.  It seems to me that the Republican when this president said, “We‘re going to listen to you,” and he really forced Harry Reid into the position of listening more and negotiating more than Harry Reid ever has, because he‘s usually much more partisan than that.

So, the word from the White House about being bipartisan was real. 

They did know and want to get Republicans buy it.

MATTHEWS:  Andrea, hold on.  Let‘s take a listen to this colloquy here involving the Senate Democratic leader and John McCain.

SEN. DAVID VITTER, ® LOUISIANA:  I would just point out that that‘s certainly not alternating speakers in terms of position on the amendment.  And I would again suggest we do what we virtually always do and alternate speakers with regard to the pending issue which is this new amendment.

REID:  I would say through the chair to my friend, wouldn‘t it be better if people who responded to these four senators had some idea what the agreement was?  It would seem to be so much more logical.  I would hope that my friend would allow us to proceed in that manner.

I would also—before I know that my friend stood for—you know Madame President, we have gone out of our way to protect everybody‘s rights.  And we haven‘t tried to blindside anyone.  We‘ve listened to all the amendments.  We‘ve been fair all the time.  I just can‘t imagine why my friend would want to do this.  My senators need to know what this agreement is.

VITTER:  Madam Speaker, I -

UNIDENTIFIED FEMALE:  The senator from Louisiana.

VITTER:  I will not object.  I‘d just like to respond to the majority leader through the chair and say I‘m very eager to understand all of the details of this proposal.  And I‘ll be doing that by getting a copy of the proposal and digesting it over a reasonable period of time over the weekend since it is a trillion dollar proposal.  But I will not object to that specific request.

UNIDENTIFIED FEMALE:  Is there objection?  Without objection, so ordered.

(INAUDIBLE)

UNIDENTIFIED FEMALE:  The senator from Nebraska.

SEN. BEN NELSON, (D) NEBRASKA:  Madam President, I rise this evening to speak about the need for Congress to support substantial and swift-acting help for our nation.  These days, all too often, when tuning into the news, we cringe.  Layoffs, job losses, poor earnings, business closings, state fiscal problems, foreclosures, global financial troubles and the worried faces of so many Americans.  Our great nation is mired in the worst economic downturn since the Great Depression.

My state of Nebraska usually late to recessions has been caught by the crisis, too.  Thousands of Nebraskans have lost their jobs, have been laid off.  Many business owners are worried, and the economic downturn is affecting everyone‘s budget and wallet and outlook.  One of the strongest Nebraska values is our work ethic.  But right now, a lot of Nebraskans just want to show up for work tomorrow or hope for a better job in the future.

That‘s why I‘ve been pleased to work with my good friend, Senator Susan Collins, and a bipartisan group of senators to address this crisis now.  To find a plan that creates jobs and restores America‘s economic strength.  We‘ve reached an agreement on a bipartisan plan that does that.  With so much at stake, however, and the cost to our children and our grandchildren so high, it is important that we get it right.

The economic recovery bill we support, today, fuels two powerful engines.  Major tax cuts for the middle-class and to create jobs and targeted investments in America‘s infrastructure and job growth.  Our bipartisan group worked long and hard, going line by line, dollar by dollar, to reduce spending from the original bill.  We trimmed the fat, fried the bacon, and milked the sacred cows.

The cost of this savings to the American people, to the taxpayers, is $110 billion, hardly the $1 billion dollars that was just mentioned.  The total package is $780 billion.

Now, the remaining bill consists of tax cuts for the middle class and specific job-creating investments providing long lasting economic benefits.

I truly want to thank my colleagues from across the aisle.  Our good friends, my good friends and partners in this effort, Senator Susan Collins and Senator Arlen Specter and my good friend from Connecticut, Joe Lieberman, for their work.  Also, we have the support of a number of our colleagues including the presiding officer on this side of the aisle.  And I guess I can affectionately call all of us the jobs squad.

Now, they made non-stop efforts and non-stop meetings to do this work this week.  And they never lost hope no matter whatever the word was on the street or the fact that there was, maybe one or two or more leaks of information.  We will never lose hope.  Their guidance and their wise counsel were invaluable as we continued to work to advance and development this consensus today.

Our plan pared back and pares back a very substantial amount of money that we believe didn‘t belong in the bill, didn‘t belong in a bill that was designed to fix our economy called a stimulus package.

Now -

CHRIS MATTHEWS, HOST:  This is breaking news right now.  That‘s Ben Nelson, the relativity conservative Democrat from Nebraska.  He‘s been working with moderate Republican, Susan Collin of Maine, to fashion a bipartisan compromise which will reach the 60 votes necessary to pass the stimulus package.  I want to go right now to Mike Viqueira who‘s going to give us an update.

Will Susan Collins speak up next?  Is that the plan here, Mike?

MIKE VIQUEIRA, NBC NEWS CORRESPONDENT:  Yes, that was the brief discussion, that procedural discussion at the beginning of this debate where David Vitter, the Republican conservative from Louisiana objected because Harry Reid wanted to do just that, have the sponsors of this measure come out and speak, in turn and sort of explain what‘s in the package.  Ben Nelson, the Democrat of Nebraska, saying they trimmed the fat, fried the bacon, and milked the sacred cows, Chris.

And one thing that‘s fascinating about this process from an institutional point of view is these moderates stepping forward.  Now, moderates, traditionally, for years have been taken for granted in both the House and the Senate, now emerging as powerbrokers.  And perhaps after that the straight party line vote in the House and all of the partisan back-and-forth we‘ve seen over the past week in relation to this bill and its negotiation behind closed doors, this could be the emergence of the some of the bipartisanship that so many people had looked for in Washington—a bipartisanship that may not have been realistic since people really hadn‘t envision how it was going to work in the face of generations of embedded cultural procedures and practices especially in the House.

But now, we‘re seeing it today.  As these senators come forward tonight and it‘s still unclear.  Jon Kyl, one of the top Republicans in the Senate has told our friends over at CNBC that there‘s not actually going to be a vote tonight.  So, it‘s unclear to me exactly how they‘re going to proceed.

But all indications are now that it will be a squeaker.  But Democrats are confident that they do have the votes ultimately on final passage to pass both this amendments being described on the floor and then later, the entire stimulus package clearing a way for a conference with the House and then final passage from both chambers and on the president‘s desk, as is the plan, anyway, late some time next week by Washington‘s birthday, as you referred, Chris.

MATTHEWS:  Well, just—it‘s not President‘s birthday .

VIQUEIRA:  It‘s Presidents Day.

MATTHEWS:  It‘s Washington‘s birthday.  It‘s for his sake (ph).

(CROSSTALK)

MATTHEWS:  Look, it looks they‘re just going to fine-tune that, it looks we‘re going to have 58 Democratic senators, all the ones that are being seated because Al Franken hasn‘t been legitimized yet.

VIQUEIRA:  Right.

MATTHEWS:  That‘s 58 including the ailing Ted Kennedy.  He‘s coming in from Florida tonight.  That‘s 58 votes, three Republicans, that‘s 61 -- talking about a squeaker, that‘s one more than they need if they get it.  Mike Viqueira, stay with us.

Our live coverage of the Senate stimulus deal, which looks like it‘s going to come in right on the nose sometime this weekend.  You‘re watching HARDBALL only on MSNBC.

(COMMERCIAL BREAK)

SEN. SUSAN COLLINS, ® MAINE:  They don‘t have enough orders to keep the workers on the job.  Madame President, these are not just cold statistics.  These are not just jobs.  These are hardworking American people who need our help.  Who deserve a stimulus package .

MATTHEWS:  Well, this is pretty dramatic stuff.  We‘re watching Susan Collins, the moderate Republican senator just re-elected, by the way, from Maine, who‘s partnered with Ben Nelson, the conservative Democrat from Nebraska in fashioning this compromise which looks like it‘s going to win a Senate approval sometime over the weekend.  However, the senators want to read this bill.  They want to take a look at even the $110 billion or so cut in the bill and make a decision on Sunday, it looks like.

Let me bring in Andrea Mitchell, chief foreign affairs correspondent and everything else in the world as she likes to point out (ph).

Andrea, thank you for joining us.  What does it look like here? 

Looks like a Sunday vote according to Kyl and others?

ANDREA MITCHELL, NBC CHIEF FOREIGN AFFAIRS CORRESPONDENT:  That‘s what it seems like.  You know, Mike Viqueira was just talking about the new way of doing business.  This moderate group, the gang, Susan Collins, who, as you pointed out, was just re-elected from Maine in the wake of the head winds of a Democratic victory elsewhere .

MATTHEWS:  Right.

MITCHELL:  . and the Obama victory up there.  So, she is pretty much bulletproof.  And she has with Ben Nelson taken this on.  But they are a new way of doing business.

The old way of doing business is what you hear, at least according to “Reuters” from the spokesman from Mitch McConnell, the Republican leader.  They want time to, quote, “read it.”  And, of course, that‘s time to configure and readjust and figure out whether there are some another positions that the Republicans want to take, not to go along with this agreement.  So, that will be a couple more days if that is the decision that‘s made.

And then, of course, there would be time for Joe Biden, who is in Munich right now and is going to be here this weekend.  He could come back in case they needed him.  Whether or not Ted Kennedy would remain in town all weekend.  He‘s flying up, we were told, from Florida, as you pointed out.

But there are two days of doing business.  And I think what‘s propelling this now is the politics of the unemployment number and the administration and their Senate colleagues trying to get the wind behind them based on this terrible unemployment numbers that came in today and that is propelling the markets as well today to begin to think that there will be some agreement, if not tonight, at least it will be voted on by Sunday.

MATTHEWS:  Andrea, you‘re a Washington buff like me.  In other words, you know the culture of this city but you also know America.  It seems like the big message from America this week, and it was addressed directly to the Daschle situation was: Stop doing business as usual, listen to us.

Could it be the Republicans are hearing the message that Daschle heard which is: stop acting like Washington?  We don‘t want anymore procedural issues.  We want you to look at this measure, vote on its merits and go with a majority.

MITCHELL:  As long as it is a scaled back measure, the fact they went from a high of $937 billion down to $780 billion, I mean, you know, it brings you to mind the whole question of what‘s the—when you start talking about these kinds of numbers—what does it mean?  But it is $780 billion.  So, it is a smaller aggregate number than what was originally proposed and what came over from the House.

But certainly, you‘re right—the message from America is: Look at the unemployment numbers, 7.6 percent today.  Look at the places that the president is planning to go on Monday and Tuesday—Elkhart, Indiana.  They‘ve gone from an unemployment number, you know, all the way up to double digits.  Florida the next day—we‘re talking about from 6 percent to 10 percent unemployment down there and a lot of foreclosures.  And he‘s going to the heart of the problem, economically, and he‘s going to take this campaign to the people and they‘re seeing that.

MATTHEWS:  Well, politics is local.  We saw that this week when Governor Charlie Crist of Florida, a Republican .

MITCHELL:  Exactly.

MATTHEWS:  . and a man on the rise, politically, came out and came out in complete support of Barack Obama, President Obama‘s economic plan.  Anyway, stay with us.

Andrea, joining us right now is Martin Kady, congressional correspondent for “Politico.”

Martin, thank you for joining us.

MARTIN KADY, POLITICO‘S CONGRESSIONAL CORRESPONDENT:  Thank you.

MATTHEWS:  You‘re new on HARDBALL.  Tell me what you see about (ph) the hearing, in terms of the politics.  It looks like the middle has grabbed the reins.

KADY:  Yes.  I mean, it was interesting to see this breakaway group.  They met a lot yesterday behind closed doors.  They did so today.  And, you know, they broke through.  We thought it was going to be stuck.

Collins, who‘s speaking now, was not on board until today.  And Rahm Emanuel came up to the Hill, went and he talked to the Republicans, he didn‘t go to Reid‘s office.  He went and talked to a couple of these moderate Republicans.

Is this the 10, 12 Republicans Obama originally wanted?  No.  Is it enough to get this through?  Yes.  And, you know, no one remembers the Steelers didn‘t cover the spread but they won the Super Bowl and that‘s how the Democrats are going to treat this.  They‘re going to win this vote.

MATTHEWS:  Let‘s talk about timing, Martin, as you describe it.  It looks to me like the middle may have won the substance but they‘re not winning on the timing.  It looks the Republican conservatives are going to demand a couple days, as they put it, to read this measure.

KADY:  Yes.

MATTHEWS:  What would be the other motive for wanting to vote for this on Sunday rather than—or even later rather than voting tonight?  Why would they want to slow this down as politicians?  What would be their motive?

KADY:  Well, there‘s a lot of news cycles even between now and Sunday.  They‘re going to get a lot of editorials from the right that pick apart this bill.  They want to go in and cherry-pick some of the things that they think will get the rise out of the public.  You know, they want to find the next little thing that looks like sod for the National Mall, contraceptives—a lot of that stuff has already been taken out.

MATTHEWS:  Yes.

KADY:  But, you know, they‘re going to look for things to pick apart, they‘re not going to, you know, crossover and vote on this if they have 48 hours to look at it.

MATTHEWS:  Well, it is refreshing, isn‘t it, Martin, that senators and members of Congress are actually reading bills?

KADY:  Yes.

MATTHEWS:  That‘s something new, isn‘t it?  Actually taking a look inside these grab bags, these omnibus bills.  I mean, I‘ve watched for years.

By the way, just to put these numbers in perspective, Patrick and I were talking a moment ago, when he was working back as an editorial writer back in the ‘60s, $100 billion was the total amount of federal spending.  When I came to the Hills in the ‘70s, I remember seeing a measure called an ironclad ceiling on federal spending at $265 billion.

This measure, by itself pared down, is three times what was once in the ‘70s the total federal budget for the year.  Patrick?

PATRICK BUCHANAN, MSNBC POLITICAL ANALYST:  Susan Collins has taken out of this measure, a sum of money, 150 billion, which is half, again, as the entire federal budget of the United States of America in the early years of the Vietnam War.

RON BROWNSTEIN, ATLANTIC MEDIA:  You know, but the point, the point, Chris .

MATTHEWS:  Ron Brownstein.

BROWNSTEIN:  When this gets done, President Obama will have the opportunity to redirect federal spending and federal priorities to an extent that is remarkable for a single bill, really even for a presidential term.  This is still a very big deal if it comes in anywhere along the lines of what we‘re talking about precisely for the reasons that you talk about.  I mean, this is an incredible amount of money to spend without having to worry about balancing .

MATTHEWS:  And none of this went through a committee.

BROWNSTEIN:  Right.

(CROSSTALK)

BUCHANAN:  Look—what is this $150 billion that‘s been cut out today?  That‘s the entire budget of California.  Was it was just slop (ph) and it was milk sacred cows and bacon and things like that?  I mean, what is exactly was it?  The Republicans .

MATTHEWS:  It‘s education funding.  A lot of it was Pell Grants and sort of higher education.

BUCHANAN:  But the Republicans have a right to -- $150 billion— they got a right to look at it and they ought to look at it before they vote yes or nay.

MATTHEWS:  You may not know it, but you‘re always tearing the heart out of liberals when they have to see this stuff cut.  They believe in these things, Pat.

BUCHANAN:  Well -

MATTHEWS:  You know that.

BUCHANAN:  We all believe in education.

(LAUGHTER)

(CROSSTALK)

BROWNSTEIN:  But some of it, I mean .

MATTHEWS:  I went to college on student loans.  There‘s nothing wrong with student loans.

BROWNSTEIN:  Absolutely.  But a little—but some of this to some extent isn‘t (INAUDIBLE) and trying to put things in this bill that they need to fight through a regular-budget process.

MATTHEWS:  Right.

BROWNSTEIN:  And Obama, probably, is signaling that he can live with some of that because that is really gravy next to the immediate problem.

MATTHEWS:  That coverage of the Senate stimulus deal which is in the works right now.  There‘s Arlen Specter.  We‘ve got to get back and hear from him.   He‘s one of the key players.  We‘ll be back with HARDBALL, obviously, the place for politics.

(COMMERCIAL BREAK)

SEN. ARLEN SPECTER, ® PENNSYLVANIA:  That we have passed a $700 billion bailout bill, TARP, where we didn‘t know what was in the bill.  We didn‘t have regular order of hearings and questions and cross-examination, or committee work on the markup line-by-line or the committee report.  We didn‘t even have a floor debate and we made a lot of mistakes.  And they were compounded by the administration carrying it out.

And I voted against the release of the second $350 billion.  And I said, “Mr. President, let‘s not do it again.  There‘s nothing magical about February 13th, before we start the week of recess for Presidents Day.”  The president responded, emphasizing the severe nature of the problem, and not telling us all which he has told us privately about the serious problems which he sees and his advisors see for any delay at all.

So, we‘re responding to his timetable.  I don‘t like it, but I‘m responding to it.  There are other aspects .

MATTHEWS:  There you have—that‘s Arlen Specter of Pennsylvania, and like the other Republicans on this compromise, he clearly put it out there by saying, he doesn‘t like the timetable of rushing this bill through.  He didn‘t like the way the bailout bill was rushed through, without knowing its internal ingredients, but he‘s saying I‘m going, but I‘m responding, Ron, to the president.  There you have a good example of a Republican who‘s cutting a deal.

Here‘s Mike Viqueira explaining it.  We got the “Chicago Sun-Times‘” Lynn Sweet joining us right now.

Mike, again, I want to start with you again.  What‘s the state of play again?

VIQUEIRA:  Well, we‘re trying to work out the procedures here.  Obviously, they allowed the original plan to go forward where the sponsors of this amendment, this so-called Collins-Nelson amendment that trims it down to a 780 billion, a mere 780 billion, are going to be allowed to go on the floor and explain the content.  It‘s unclear whether Republicans are actually going to go forward with an objection to a consent request of a vote tonight.  It appears likely that they will at this point.

Chris, I want to talk a little bit about how this theme of bipartisanship that everybody has been arguing about over the last several weeks and how it‘s been—everybody has been so shocked by the brutal nature of Washington.  You know, this gaping mob that the Obama administration has walked into and just been chewed up especially in the House of Representatives when there was a straight-party line vote.

And, I think, last night, when you saw the president go down to Williamsburg and give that red meat speech to House Democrats, he was going back to the tried and true especially in the House.  Those are the people that he has.  Their fortunes are going to rise and fall on each other‘s fortunes.  They have to be with each other.

Some people actually expected him to go down there and admonish Democrats for not being bipartisanship enough.  Oh, that‘s not the way it works especially in the House.

But I want—I‘m interested to see how the story is going to be written in the end when it comes to the politics and the bipartisan nature of it—because if this deal goes through in the Senate, I think you‘re going to see a lot of moderate Republicans—you know, maybe a dozen to two dozen come back over and have two bites at the apple.  Vote against it the first time it came out of the House .

MATTHEWS:  Right.

VIQUEIRA:  . when it comes back vote for this bill.  A lot of Democrats are going to be unhappy.  Liberal Democrats are going to be unhappy with the cuts that you mentioned in education and if there are cuts in Pell Grants and flu funding and National Endowment for the Arts things of that nature.  They may get some leakage on the left.

If there is a fix of the alternative minimum tax in the bill as there has been all along in the Senate bill, that‘s going to take away a lot of programs that were cherished by House members.  So, there are going to be some angry people in the House and we‘ll see how the final bill ends up.  But there‘s a possibility now that we could rewrite this whole story about this failure of bipartisanship at the outset of the Obama administration if this continues as it appears to be going tonight.

MATTHEWS:  Now, I want to—Lynn Sweet is joining us right now.  It looks to me like the victors here tonight and over the weekend will be in posterity perhaps, the moderate Republicans and Democrats who put together this deal.  It looks like 60 votes will be enough.

LYNN SWEET, CHICAGO SUN-TIMES:  Absolutely.  I talked to a top Senate source yesterday morning and they were confident they would be able to get the 60 votes.  They just weren‘t sure when.

You know, the key number is just getting it past the 900 billion-plus that was in the Senate.  Now, they‘re at 780 now.  Remember, Chris, in the House, it‘s 819.  Conference, conference, conference .

MATTHEWS:  Yes.

SWEET:  . that‘s is where the real work is going to be done.  You know, and Mike is right.  There‘s another bite at the apple.  The other thing to remember is that they never figured out what is the right answer to this.  Is it tax cuts or is it spending?  So, as you see, by the division of the bill, it‘s going to be a lot of both.

MATTHEWS:  It looks like it‘s going to be 3/5 spending increase and 2/5 tax cuts according to John Kerry‘s leak in this thing.  Anyway, we‘ll be right back with more tonight.  In fact, we‘ll be back with the deal tonight in the U.S. Senate.

You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with NBC‘s Mike Viqueira and Lynn Sweet of the “Chicago Sun-Times” watching the big four here.  That‘s, of course, Joe Lieberman of Connecticut, Arlen Specter of Pennsylvania, Susan Collins of Maine, and the conservative Democrat Ben Nelson.

Mike, it looks like—are those the big four that put this deal together that looks like it‘s going to get the stimulus package through the Senate?

VIQUEIRA:  I don‘t know.  Let‘s stick with big two, Collins and Nelson.  I‘m not sure—I mean Arlen Specter, obviously, a key player here.  He was one of the ones that was most gettable and appears that—well, he just announced that they have gotten him as a matter of fact, and Joe Lieberman, of course.  Lieberman, of course, for the last several years taking a lot of heat from the left for his support of John McCain .

MATTHEWS:  Yes.

VIQUEIRA:  . his support of the war.  But on everything other than national security, he‘s been a solid Democrat, Chris.

MATTHEWS:  OK.  Let‘s go to Martin Kady of “CQ” Martin, your thoughts about this—of “Politico.”

KADY:  Well, it‘s interesting—the Republicans have 48 hours more on this, really, to think about it.  And all they have is the talking points.  They obviously don‘t have the votes and they can try to court public opinion going into the conference committee, and that‘s all they have, though.

So this is their last voice because once this is done, once this is a done deal, the predominant image that America is going to see is a big signing ceremony and they‘re going to put a couple of Republicans, maybe Specter, maybe Collins, right there next to President Obama when he signs this.

I just got an e-mail from a Senate Republican office claiming that the bill—the 780 is not the right number.  That it‘s going to end up being 827 billion because there‘s a couple amendments including one Republican homebuyers tax credit that needed to be added back in that already passed.  So, the number 780, I wouldn‘t stick with that quite yet.

MATTHEWS:  Lynn Sweet, your thoughts as we go to break here.

SWEET:  Final thoughts—they have to have something in there for homeowners, whether it‘s a tax credit or some other kind of mortgage or relief or promise, one that is coming up very quickly.  And the final thing is—Obama is going to go on the campaign-style tour of Fort Myers, Florida and Elkhart, Indiana and whipping up his e-mail list to get support for this stimulus bill.

MATTHEWS:  OK.  Thank you very much, Andrea Mitchell, Mike Viqueira, Martin Kady, and Lynn Sweet.

Our coverage continues now with COUNTDOWN with Keith Olbermann.

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