Guest: Michael Eric Dyson, Tim Pawlenty, Matt Taibbi, Jonathan Capehart, Mike Barnicle, Jim Cramer, Rick Santelli, Pat Buchanan
MIKE BARNICLE, GUEST HOST: The housing crisis, the banking crisis, the auto crisis—what‘s a new president to do?
Let‘s play HARDBALL.
Good evening. I‘m Mike Barnicle. Leading off tonight: facing economic headwinds. On Tuesday, President Obama signed the stimulus bill. Yesterday he unveiled his plan to halt home foreclosures, and today the issue is trade, and specifically, the North American Free Trade Agreement as the president made his first international trip to Canada.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: As, obviously, one of the largest economies in the world, it‘s important for us to make sure that we‘re showing leadership in the belief that trade ultimately is beneficial to all countries.
(END VIDEO CLIP)
BARNICLE: Will President Obama‘s economic initiatives be enough to steer the economy back on track? We‘ll break down all the economic challenges confronting the president with CNBC‘s Jim Cramer.
And while we‘re talking about the economy, if you watched CNBC this morning, you couldn‘t miss this.
(BEGIN VIDEO CLIP)
RICK SANTELLI, CNBC: This is America! How many of you people want to pay for your neighbor‘s mortgage that has an extra bathroom and can‘t pay their bills? Raise their hand! How about we all...
(CHEERS)
SANTELLI: President Obama, are you listening?
(END VIDEO CLIP)
BARNICLE: Well, what was behind all that? We‘ll talk to the instigator who was speaking for a lot of Americans, CNBC‘s Rick Santelli.
Plus: Talk about making a big first impression. Listen to what the new attorney general, Eric Holder, said last night in a speech honoring Black History Month.
(BEGIN VIDEO CLIP)
ERIC HOLDER, ATTORNEY GENERAL OF THE UNITED STATES: Though this nation has proudly thought of itself as an ethnic melting pot, in things racial, we have always been and we, I believe, continue to be in too many ways essentially a nation of cowards.
(END VIDEO CLIP)
BARNICLE: OK. Well, what did Mr. Holder mean by that? Are we really a nation of cowards when it comes to racial issues? That‘s the hot debate.
Also, what exactly does the Republican Party stand for these days? So far this year, Washington Republicans have been the “just say no” party, but the nation‘s GOP governors are split. Some like the president‘s economic recovery plan. Others are actually refusing to take the money. Who‘s right here? Well, we‘ll talk to one of the governors who just might want to be president some day, Minnesota‘s Tim Pawlenty.
And here‘s an interesting revelation. J. Edgar Hoover‘s FBI was investigating whether Jack Valenti, a top aide to President Johnson who later became the head of the Motion Picture Association of America, was gay. What does this say about Hoover, the FBI and our obsession with sexual orientation? We‘ll get to that in the “Politics Fix.”
And finally, remember this, the incident that made one man the most famous journalist in Iraq? Well, today, the guy who threw his shoes at President Bush tried to talk his way out of trouble in court, and he just might get away with it. We‘ll have that in the HARDBALL “Sideshow.”
But we begin with the economic challenges facing President Obama. The great Jim Cramer is the host of CNBC‘s “Mad Money.” It‘s always a pleasure to see you, Jim.
JIM CRAMER, HOST, CNBC‘S “MAD MONEY”: Hey, Mike.
BARNICLE: In these turbulent times, I want to ask you one question right out of the box. We‘ve had the stimulus package passed. We‘ve had the president talking about foreclosures and introducing a new concept in terms of keeping people in their homes. I ask you, what is at the root of all of these problems that they‘re having? What would you deal with first, housing or the banks?
CRAMER: I think that they‘re one and the same, Mike. I feel like unless you get some house price stabilization or even appreciation, you‘re not going to be able to deal with the banks, which all are being weighed down by mortgages that can‘t be paid.
BARNICLE: All right, so how does it work for the banks, this proposed new plan by the president? I mean, doesn‘t it put them even in more detrimental terms? I mean, now they‘re being asked to reduce the amount of payments they‘re getting from people who might be unemployed, losing their house. So they‘re going to have less money coming into an already perilous situation.
CRAMER: Mike, that‘s what the stock market is saying. We had one—just one more huge decline in the banks, the financials today. They‘re now back to where they were in 1992. We also are doing a curious (ph) play on Wall Street. It‘s called waiting for Geithner. We don‘t know what happened to Tim Geithner. We hope he didn‘t leave the building. But we are waiting with bated breath about something that he says that will make it so that we don‘t feel the banks are weighed down exactly the way you described.
BARNICLE: Let me ask you about Wall Street. What is wrong with these people? Don‘t they have any faith in this country? I mean, I watch you, I watch CNBC all day long. It‘s getting depressing watching these bust-outs on Wall Street continually running this country down by allowing the market to run down every day. What‘s wrong with them?
CRAMER: Well, look, we don‘t have a Soviet-style government and we can‘t just halt stock prices and we can‘t take over companies, although there, of course, is always a move to nationalize the banks.
But you know, Mike, look, we accurately reflect worldwide stress. Let me give you just a silver lining. And I‘m not a big silver lining guy, if you watch my show. But we actually are better off than Europe, which is really amazing. I mean, we‘re actually further along. And our Federal Reserve chairman is being very proactive after a long period where I didn‘t think he was on the game. He‘s totally on the game. I wish the president would just get him in the room and say, What do I do, Ben? Because Ben‘s got answers. He has answers.
BARNICLE: Do you think that they‘ll nationalize the banks? Not that they haven‘t already been nationalized, to a certain degree.
CRAMER: I think it would be a disaster. I think that people talk about the Swedish solution, that Sweden nationalized banks. We‘re not Sweden, Mike. Georgia is bigger than Sweden. I mean, our banks are complex. Do we think that they can be run by people who run—I mean, look, I love the Post Office, but can the people who run the banks—they also—you know, this is who you get, the guys who run Amtrak. I mean, the government is not necessarily prepared to step into the shoes of the people who run Bank of America. I don‘t think they can do as good a job.
BARNICLE: How did it get to this point? How did so many people miss so many signs just over the last year-and-a-half, never mind six or seven years ago, in terms of the housing boom and the mortgages to people who couldn‘t afford them, just the last year-and-a-half? How did so many smart people miss so many stop signs?
CRAMER: There was so much money made, Mike, it wasn‘t worth seeing the stop signs. You could make so much money on one of these trading desks or mortgage desk that, frankly, you stopped caring about your client. Now, I mean, look, I—look, I said that Bank of America (INAUDIBLE) do better than the government, but Bank of America, CitiBank, they all—if you were on the trading desk—I used to be on a trading desk—you could make $5 million, $6 million, $7 million, and it wouldn‘t—you‘d do it in three years. You‘d gaffe (ph) every one of your clients, and then you go home. And we had a level of greed that was only equaled by the amount of money you made. So there was just too much money to be made, Mike. It was just too bountiful.
BARNICLE: Let‘s flip to housing. Do you understand—tell me—explain this plan that the president talked about yesterday. How does it work?
CRAMER: Well, what you would do is you‘d modify the interest rate. Now, I have to tell you, I mean, I think that some of the reaction was good, but there isn‘t (ph) a single piece of data which says that unless you cut the principal, not the interest, can you keep people in their homes. The foreclosure rate will not be stopped by this. We have a continually large pool of homes from foreclosure.
Now, new homes are down from two million in 2006 to 400,000. This plan will maybe make it so that maybe, I don‘t know, a quarter of the people that would be foreclosed might not. If we cut principal, we can solve this problem, but no one wants to cut principal because it‘s considered sacrosanct for the banks.
BARNICLE: What do we do about human nature with regard to this plan?
I‘m living in my house. I bought it 10 years ago. I put a new kitchen in. I got a second mortgage. I can pay the mortgage. My wife is working. My next-door neighbor—he bought a house that he shouldn‘t have bought. He‘s not making enough money to have—you know, to make the mortgage payments. They shouldn‘t have let him buy the house in the first place.
What happens in terms of human nature when I think to myself, I‘m paying for this guy‘s mortgage to keep him in his house that he shouldn‘t have been able to afford in the first place?
CRAMER: I‘m having a town hall with Sheila Bair, who‘s the great head of FDIC, next week, and I‘m going to propose the following. A little hubris here, but why not propose something? No one else is able to. I want a 4 percent government mortgage. That‘s right, government gets in the business for 18 months, not just for the guy who overextended but for you, too, Mike. Let everyone refinance at 4 percent. You get rid of the moral hazard. Call it a 40-year. People cut principal.
But my plan doesn‘t have you on the sidelines, like Rick Santelli, my friend in Chicago, screaming that I‘m bailing you out. We give everybody the 4 percent. The government gets in the game. It alleviates a lot of tension in the banks. Otherwise, Mike, I got to tell you, that Great Depression thing keeps coming up again.
BARNICLE: Hey, quick question, Jimmy, before we let you out of here...
SANTELLI: Sure.
BARNICLE: ... to go to Rick Santelli. The automobile industry—
General Motors, Chrysler—do you let them file bankruptcy or do you continue throwing money at them?
CRAMER: Mike, I was a shop steward. I led a wildcat strike at one point in my life. I have been a lefty when it comes to unions. You got to break them. You got to break them. And only bankruptcy lets you break them.
BARNICLE: I‘m with you, Jim. Jim Cramer, thanks very much. You can watch Jim Cramer weeknights on CNBC at 6:00 and 11:00.
And now the aforementioned CNBC‘s Rick Santelli. He had a moment today on the floor of the Chicago Mercantile Exchange group. Take a look.
(BEGIN VIDEO CLIP)
SANTELLI: The government is promoting bad behavior because we certainly don‘t want to put stimulus forth and give people a whopping $8 or $10 in their check and think they ought to save it and in terms of modifications. I‘ll tell you what. I have an idea. You know, the new administration‘s big on computers and technology. How about this, president and new administration? Why don‘t you put up a Web site to have people vote on the Internet as a referendum to see if we really want to subsidize the losers‘ mortgages or would we like to at least buy cars and buy houses in foreclosure and give them to people that might have a chance to actually prosper down the road and reward people that could carry the water instead of drink the water.
UNIDENTIFIED MALE: Hey, Rick, there‘s a novel idea!
UNIDENTIFIED MALE: Hey, Rick?
SANTELLI: What? Who thought of that?
(CHEERS)
UNIDENTIFIED MALE: They‘re like putty in your hands. Did you hear...
SANTELLI: No, they‘re not, Joe! They‘re not like putty in our hands! This is America! How many of you people want to pay for your neighbor‘s mortgage that has an extra bathroom and can‘t pay their bills? Raise their hand.
(BOOS)
SANTELLI: President Obama, are you listening?
(END VIDEO CLIP)
BARNICLE: Rick Santelli, how many e-mails did you get after that one?
SANTELLI: Well, my BlackBerry‘s pretty much been frozen since 8:15 Eastern this morning, and it‘s running pretty much 99 percent to 1 in favor. And all‘s I can say is, is I‘m impassioned, anybody who watches CNBC. That was spontaneous. The markets weren‘t open. Traders gravitated to the camera. And most of those people that were back there in that shot weren‘t the elite. A lot of them were the clerks, the people working 10-hour days, maybe trying to get some overtime. And I think that‘s the voice of America.
BARNICLE: Well, I think you‘re right, Rick. And I‘m with you on this. I mean, I don‘t understand the whole mortgage refinancing deal that was announced yesterday. It‘s a little too complex for me.
SANTELLI: No, hey, listen, I have great respect for Jim Cramer, and God forbid anybody actually yells on TV, but I will tell you this. Whether you pay 6 percent, 5 percent, 4 percent or no percent, that really isn‘t the issue. It‘s not a financing issue. And in terms of principal, I liked what you said when you were talking to Jim Cramer.
Listen, if they want to help the 8 percent to 10 percent that probably aren‘t a good risk, that probably aren‘t going to contribute after the stimulus and the TARPs are gone, they should also take care of that 90 percent to 92 percent, us that are working, that 401(k)s are 201(k)s. Maybe they give us a four-month tax reprieve or a tax holiday or send everybody a check that owns a mortgage.
I don‘t think it‘s right in America to reward people that made the wrong decisions. Send them to classes on how to read the small print, but I think that the greater bulk of this country should be getting something and being taken care of and not ignored.
BARNICLE: So what happens, as you understand it, within this bill if we end up—you know, I‘m paying, you‘re paying for the people next door, who bought the $800,000 house when they could have only really afforded a $400,000 house, so part of my tax dollars are going to help them pay their mortgage—what happens when the value of their home starts going back up again, if this housing thing ever stops—hits bottom and comes back up? Are they going to kick any money back to us when their home value goes up?
SANTELLI: Well, you bring up a great point. Many of the plans that were set up to rescue banks or any of these plans that have been implemented thus far always seem to have a clause to look for some type of remuneration or compensation for the taxpayers. Whether it‘s the banks, of course, there‘s some stock there involved. But this plan has none of that.
And this isn‘t class warfare, as some people have called it, my two or three e-mails that weren‘t positive. If there‘s anything going on between the classes, it‘s being fueled by this type of legislation.
And one of the arguments is, Well Rick, if the house on the right and the house on the left are going to foreclosure, it‘s not going to make your property worth more, so you‘re fighting a losing cause. I‘ll tell you what. I don‘t look at my house as an investment. It‘s where I live. And when housing prices were sky-high, I didn‘t sell.
And let me tell you, I can bite the bullet and I have the intestinal fortitude, along with a lot of other Americans, to bite the bullet here because subsidizing those on the left and the right might, might make the pain easier in the near term, but I don‘t think it‘s a great philosophical discussion for the country‘s outcome in the long term!
BARNICLE: Hey, Rick, if you can give me a short answer to this question, I‘d appreciate it.
SANTELLI: I‘m sorry.
BARNICLE: Under this bill, can I restructure my mortgage?
SANTELLI: I don‘t think so, buddy.
BARNICLE: Oh, man!
SANTELLI: No. And see, that‘s my point. There needs to be something for all of us because the 90 percent can‘t become 60 percent or 70 percent and think when we get through this we‘re going to be better off!
BARNICLE: I agree with you. Rick Santelli, good job this morning, Rick. You spoke for a lot of people.
SANTELLI: Thank you.
BARNICLE: Coming up: New attorney general Eric Holder says average Americans don‘t talk to each other enough about racial issues and calls us, quote, “a nation of cowards,” unquote, for avoiding the topic. Now he‘s got people talking. Two points of view coming up next.
You‘re watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
BARNICLE: Welcome back to HARDBALL. Yesterday Attorney General Eric Holder spoke about Black History Month at the Department of Justice. Take a listen.
(BEGIN VIDEO CLIP)
ERIC HOLDER, ATTORNEY GENERAL OF THE UNITED STATES: Though this nation has proudly thought of itself as an ethnic melting pot, in things racial, we have always been and we, I believe, continue to be in too many ways essentially a nation of cowards. Though race-related issues continue to occupy a significant portion of our political discussion, and though there remain many unresolved racial issues in this nation, we average Americans simply do not talk enough with each other about things racial.
(END VIDEO CLIP)
BARNICLE: Well, OK, I‘ll buy that. But the cowards thing? Well, is the attorney general right? Are Americans a nation of cowards when it comes to race? Pat Buchanan is an MSNBC political analyst and Georgetown University professor Michael Eric Dyson is the author of new book called “April 4, 1968: Martin Luther King, Jr.‘s, Death and How it Changed America.”
Professor Dyson, my old friend, I got to tell you, I was kind of surprised when I heard Eric Holder say we are a nation of cowards. I don‘t think we are when it comes to race. I think we might be awkward in talking about it. We might be a little reluctant to talk about it. But cowards, no. What do you say?
MICHAEL ERIC DYSON, GEORGETOWN UNIVERSITY: Well, Brother Barnicle, my dear friend, I think that Mr. Holder, Attorney General Holder, who‘s an extraordinarily eloquent and balanced man, he‘s very judicious, not seen as a radical by any measure—this man got to the heart of the matter. His point was that we are cowardly when you compare us to other arenas of expertise and pursuit in America.
We are not willing to be second to anybody when it comes to the space race, when it comes to technology, when it comes to this failed economy, unfortunately, when it comes to our sense of competition. But when it comes coming to race, we lag far behind. We don‘t have the ability to step up to the plate and be honest about all of the array of problems that we continue to confront.
I think Mr. Holder was trying to suggest to America, Let‘s allow the rest of our grand legacy of American democratic experimentation match us when it comes to speaking openly and honestly and forthrightly about race. Many people think that we live now in a post-racial society because of President Barack Obama‘s ascendancy to the highest office in the land. That is just not true. Neither should we be. We shouldn‘t be post-racial...
BARNICLE: OK...
DYSON: ... we should be post-racist. We should look beyond the day when narrow impediments and blind bigotries continue to impede us from moving forward in this nation.
BARNICLE: OK, Pat Buchanan, you just heard Professor Dyson say that we are less than honest, as a nation, as a people, in talking about race. What do you think happens with white guys like you and me when we talk about race in—honestly, at least from our perspective? What happens?
PAT BUCHANAN, MSNBC POLITICAL ANALYST: Oh, you get a...
(LAUGHTER)
BUCHANAN: You get a—I have—I have spoken honestly, from my standpoint. And I know you really get fired upon.
But let me say this about Mr. Holder. This is a remark of almost paralyzing stupidity. If you want to start a discussion about how there is a measure of social self-segregation going on—I mean, you have got black churches, Black Caucus, black colleges, and black clubs—there is that.
If he wants to discuss that, Mike, you don‘t start it off by insulting the people you want to talk to. I mean, that was not an invitation to a discussion. It was an invitation to a fight, when you call us a nation of cowards.
Secondly, no nation on Earth has done more in the last 50 years—and, in the last 50 years, the American people and American nation, to bring this people of color into full participation in American society. And none has succeeded more.
And to call us cowards, I think, it really not only chops off the conversation; it is a blatant lie.
BARNICLE: Professor Dyson?
DYSON: Well, let me—let me respond to that. Let me respond to that.
First of all, when you say self-segregation, the black church didn‘t come into existence because it desired to be separate from the white church. The white separatist movement White House American Christianity forced black churches to start their own.
The Congressional Black Caucus came into existence (AUDIO GAP) and white supremacist (AUDIO GAP)
BARNICLE: Well, we‘re having a little difficulty there with professor Dyson‘s...
DYSON: (AUDIO GAP) black people in America—black people in America continue to exist within the context of segregation, that segregation is largely imposed from without.
What we need to do, then, is to argue about the necessity for America to embrace all of its different colors, all of its vital ethnic and racial strands, so that we can be truly e pluribus unum, out of many, one.
BARNICLE: Pat Buchanan?
BUCHANAN: All right. Well, let me—let me—let me just say to this professor Dyson.
You—look, I think coming on these TV shows and having a discussion, even an argument, is a good thing. But you don‘t get a discussion when you walk on and say, first off, I want to say, you all are a bunch of cowards, because it‘s not true.
DYSON: That‘s not what he said.
BUCHANAN: It‘s an insult. And—well, he said, we are a nation of cowards.
Was he talking about himself? I mean, was he talking about Obama, sitting there silently when Reverend Wright went into his racist diatribes?
DYSON: No.
BUCHANAN: Who was he talking about? Most of think...
DYSON: Let me tell you...
BUCHANAN: ... hey, he‘s talking about us.
DYSON: Let me tell you who he‘s talking about. He‘s talking about America.
Look—look at this point. You know, you say you want honest conversation. And Mr. Barnicle started the conversation, what happens when “we white guys” speak honestly about race?
Well, I will tell you what happens. When you speak honestly about race, you tell the truth about what you feel. All of us should be allowed to do that. The question is, when we put our bona fides on the table, when we establish what we think are the baselines for racial conversation in America, we have to be honest and willing to say, hey, maybe we didn‘t get it right. Maybe white supremacy, social injustice, the owning of slaves, Jim Crow law, and vicious bigotry have not led to the best experiment in democracy.
BUCHANAN: Right. All right, Reverend Dyson...
DYSON: Hold on.
(CROSSTALK)
DYSON: And what we must do now is to acknowledge that and then move forward. It is not—so, when black people tell the truth...
BUCHANAN: All right, let me ask you and tell you something.
DYSON: ... then white feelings of guilt and offense come about.
(CROSSTALK)
BARNICLE: All right. All right. Professor, let—let Pat in here.
BUCHANAN: OK, let me tell some truths. Let me tell some truths. Let me tell some truths.
White folks in America are not responsible for the 70 percent illegitimacy rate in the black community. We are not responsible for the fact that African-Americans commit crimes at seven times the rate of white Americans. We are not responsible for the fact that many more children in the African-American community, 75 percent, are born out of wedlock, as I said.
All of these things are the responsibility of the African-American community. And its leaders should address the problems in their own community and stop blaming folks who are not responsible.
DYSON: Let me respond to that.
First of all—first of all—first of all—first of all, Jesse Jackson has been responding to that issue for the last 40 years. Many people have been having a vibrant, vital, consistent conversation about the necessity for self-responsibility.
What I didn‘t hear you say is that black people are not responsible for Oscar Grant, when he goes out in Oakland, and then gets viciously assaulted by a policeman. We are not responsible for chimpanzee commercials and cartoons put forth...
BUCHANAN: Right.
DYSON: ... by “The New York Post” that draw—let me finish—that draw an implicit relationship between the president...
BUCHANAN: Sure.
BARNICLE: Well, we‘re—we‘re having trouble with professor Dyson‘s....
BUCHANAN: Professor Dyson...
BARNICLE: Go ahead, Pat.
BUCHANAN: ... let me tell you, the—in the statistics on group crime against individuals, gang rape and gang assaults, the numbers are almost 100-1. Forty-five percent of African-American crime is committed against whites. Whites commit 3 percent of their crimes against African-Americans.
All crime should be condemned, but it seems to me, in the African-American community, you should look to your own responsibilities, instead of our faults.
(CROSSTALK)
DYSON: See, what you have done, you have tried to derail—you‘re trying to (AUDIO GAP) responsibility for taking (AUDIO GAP) step. According to you, the entire problem of racial fascism in this country rests upon the backs of black people.
You have not owned up to, at one point in this conversation, the reality that...
BUCHANAN: No, it doesn‘t. I‘m saying you‘re not taking—owning up to anything, fellow.
DYSON: ... the dominant American culture has fed the—and fueled the vicious divisiveness that we continue to confront. So, now you‘re trying to scapegoat.
BUCHANAN: Stop blaming everybody else for your—you continue to blame—look, the African-American community was...
(CROSSTALK)
DYSON: I‘m not blaming anybody.
(CROSSTALK)
DYSON: But when black people talk about honest feelings, it‘s blaming. When white people talk about it, it‘s called being held responsible.
(CROSSTALK)
DYSON: You don‘t want to be responsible. You don‘t want to be responsible.
(CROSSTALK)
BARNICLE: All right.
(CROSSTALK)
BUCHANAN: In 1948, the African-American community was far more responsible, far less criminal than it is today.
DYSON: Eric Holder was right. This nation must live up to the true meaning of...
(CROSSTALK)
DYSON: And we must engage in some serious analysis of what‘s going wrong in the country.
If we can‘t be honest about that—many black people are used to hearing negative things about themselves every day in the press. Many white people are not. It‘s time that we share the burden and redistribute the pain, and all of us engage in a convincingly open, cogent explanation about why we are where we are racially. And Eric Holder has done that with his brilliant comments.
(CROSSTALK)
BARNICLE: All right, professor...
(CROSSTALK)
BUCHANAN: I think, professor, you have got to take a little more responsibility for your own community.
(CROSSTALK)
DYSON: Brother, we are going to be responsible.
What I need to hear you talk about is responsibility for what America has done to so many, not only African-American people, native peoples...
(CROSSTALK)
DYSON: ... people. And then all of us can move forward, a society where...
(CROSSTALK)
DYSON: ... e pluribus unum...
(CROSSTALK)
BUCHANAN: No better country on Earth for African—no better country on Earth for African people than America.
BARNICLE: We have got to go.
BUCHANAN: No better country.
DYSON: We love America. That‘s why we have a black president.
(LAUGHTER)
BARNICLE: And that‘s why we‘re not a nation of cowards, professor Dyson.
BUCHANAN: I loved it—I loved it even before that.
DYSON: Well, you know what?
(LAUGHTER)
DYSON: Here‘s my point. My point is simply this.
The election of one black man in public housing on 1600 Pennsylvania Avenue will not solve the problems of the nation. Barack Obama understands that. The rest of us should understand that, too.
BARNICLE: Well...
DYSON: It‘s an enormous move forward, but we still have work to be done. That‘s all we‘re suggesting. It is both/and, not either/or.
BARNICLE: Michael Eric Dyson...
BUCHANAN: I think you do have work to be done and we have work to be done. I agree with that.
BARNICLE: ... and Pat Buchanan, thank you very much.
Up next: Secretary of State Hillary Clinton wows them in Indonesia. We have got her appearance on a show called “Awesome,” just like what you just saw, awesome. That‘s next in the HARDBALL “Sideshow.”
You‘re watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
(MUSIC)
BARNICLE: Oh, I love the music.
Back to HARDBALL. Time for the “Sideshow.”
First up, talk about a goodwill ambassador. Yesterday, on her first official to Indonesia, Secretary of State Hillary Clinton appeared on a local TV show called “Awesome.” She was a good sport, too.
(BEGIN VIDEO CLIP, “AWESOME”)
HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: I was told I was going to be on an awesome show this morning.
UNIDENTIFIED FEMALE: Yes.
(CROSSTALK)
(LAUGHTER)
UNIDENTIFIED FEMALE: But the question is, what is your favorite music and artist?
CLINTON: It is really the—the old standbys, like the Beatles and the Rolling Stones.
UNIDENTIFIED FEMALE: OK.
(CROSSTALK)
(LAUGHTER)
(APPLAUSE)
CLINTON: I am really, you know, very...
(APPLAUSE)
CLINTON: Oh, good. Good. I don‘t feel so old. I love it.
(LAUGHTER)
UNIDENTIFIED FEMALE: What is your most valuable or experience or lesson that you have learned during your campaign?
CLINTON: I campaigned hard against President Obama. We had an incredibly intense competition. But, in a democracy, somebody has to win and somebody has to lose.
(END VIDEO CLIP)
BARNICLE: Well, she‘s right about the ‘60s decade of music, the greatest ever in America.
Next up: Remember the shoe toss heard round the world? Well, that right-handed guy who came in out of the bullpen, the shoe-throwing guy, made his first appearance in Iraqi court today.
Here‘s his defense: It wasn‘t a crime—quote—“I am charged now with attacking the prime minister‘s guest, but Bush and his soldiers have been here for six years. Guests should knock on the door. Those who come sneaking in are not guests.”
He‘s referring to the fact that President Bush came to Iraq unannounced and didn‘t leave the U.S.-controlled Green Zone. Still, it sounds like a stretch, right? Well, it just might work. The judge today postponed the trial to get an opinion from the Iraqi government as to whether President Bush‘s visit was, in fact, official. That—that will be on the level.
(LAUGHTER)
BARNICLE: Now for tonight‘s “Big Number.”
Up in Minnesota, Al Franken calls himself the senator-elect. But Norm Coleman keeps raising money in the legal battle to keep his seat. Just look that this heavy-hitter appeal from Coleman‘s Capitol Hill buddies.
(BEGIN VIDEO CLIP, AD)
SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: America needs Norm Coleman in the Senate. And I hope you will participate in helping make that possible.
REP. JOHN BOEHNER (R-OH), HOUSE MINORITY LEADER: He‘s somebody who‘s a real reformer here in Washington, somebody that stands up on behalf of taxpayers.
MICHAEL STEELE, CHAIRMAN, REPUBLICAN NATIONAL COMMITTEE: We want him back in Washington. We need him back in Washington.
SEN. LAMAR ALEXANDER ®, TENNESSEE: I‘m doing everything I can to help him make sure that every single Minnesota valid vote is counted.
(END VIDEO CLIP)
BARNICLE: Good time to raise money, huh?
This thing could keep going for weeks or months, but here‘s a reminder of just how long after Election Day this battle has already lasted: 107 days, with no end in sight. The Minnesota recount battle has stretched 107 days beyond Election Day—tonight‘s “Big Number.”
Up next: President Obama‘s economic plan got an embrace from some Republican governors and a stiff-arm from some others. What is behind the split? That‘s coming up next.
You‘re watching HARDBALL, only on MSNBC.
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JULIA BOORSTIN, CNBC CORRESPONDENT: I‘m Julia Boorstin with your CNBC “Market Wrap.”
The Dow Jones industrials closed at their lowest level in more than six years. The Dow lost 89 points, closing at 7465, its lowest level since October of 2002. The S&P 500 fell nine points. The Nasdaq dropped 25.
The number of initial jobless claims remained steady last week at 627,000, but the total number of people receiving unemployment benefits climbed to an all-time high of 4.99 million.
Oil prices surged today, following an unexpected drop in U.S. inventories. Crude gained $4.86, closing at $39.48 a barrel.
And the FBI says it located Texas billionaire R. Allen Stanford in Virginia and served him with papers, but did not arrest him. He is accused in the latest investor fraud scheme allegedly involving $8 billion in certificates of deposit.
That it‘s from CNBC, first in business worldwide—now back to
HARDBALL.
BARNICLE: Welcome back to HARDBALL.
The group of Republican governors who opposed the stimulus package reads like a list of potential Obama challengers in 2012. But a couple of them actually plan to take federal dollars, despite their objections to the recovery plan.
Minnesota Governor Tim Pawlenty didn‘t like the stimulus package, but he says he will take the money.
Governor Pawlenty, before we get into that issue, when are you going to have a United States senator? I mean, I know you like hockey.
(LAUGHTER)
BARNICLE: You know, they have the shoot-out, but, eventually, the overtimes end. What—what is the deal on the Minnesota Senate seat? Give us the latest.
GOV. TIM PAWLENTY ®, MINNESOTA: Well, the short version, Mike, is, the state court is going through the process right now. If one side or the other decides to appeal the outcome to federal court, this could take well into summer, or longer. It may be that one side or the other decides not to do that.
But it—there‘s no end in sight, as you said earlier, but it‘s important that this get decided right. We don‘t want an outcome where people say there was fraud or mischief or some legal flaw. And, so, it is going to get sorted out. But the frustrating part is, it‘s taking a long time.
BARNICLE: How does it effect, if it does, or impact, if it does, the people of Minnesota, having only one United States senator?
PAWLENTY: Well, it impacts us significantly, because, right now, some of the big issues of our time are being decided in Washington. And having only one senator is a big disadvantage for our state. So, it‘s very unfortunate. And it puts us at a disadvantage.
BARNICLE: All right, you—you didn‘t like the—the package, the stimulus package. What didn‘t you like about it? Tell me.
PAWLENTY: Well, a number of things.
First of all, we should keep in mind that the federal government is spending money that they don‘t have. They‘re going deeper and deeper in debt by the minute, by the hour, by the day. And most of this money ultimately is coming from China, because they‘re the ones buying our debt, substantially. And, so, we need to put some definition around how far we‘re going to go further into debt as a country.
But, secondly, this is a stimulus package that does not focus on bread-and-butter things like tax cuts, that would have put more money into more people‘s pockets, or bread-and-butter infrastructure projects I think most bipartisan-minded people could support.
And it wandered into a meandering buffet, financial buffet, of all kinds of other things, and went beyond those core areas of focus.
And, lastly, it was disappointing, because President Obama said he was going to usher in this era of bipartisan leadership. And this was really a missed opportunity in that regard, because I think, with a slightly more focused bill, he would have received substantially more Republican support.
I support a stimulus bill. I just think this one could have been better.
BARNICLE: All right. Look it, I mean, you are a good guy. You‘re a bipartisan guy.
You have got the automatons in the House of Representatives. They stand up en masse and vote. Not one Republican votes for the stimulus plan. So, I understand that. That‘s partisanship, purely defined.
But let me get back to the top of your answer, because there‘s something that really annoys me, just as a taxpayer and as a citizen. President George W. Bush came into office with a surplus in January 2001. For the first time in history, from the time people went to war, throwing rocks at one another, he decided to fight a two-front war in Iraq and Afghanistan and raised—and cut taxes instead of raising taxes. He cut taxes and raised—and waged war. And we end up with a huge deficit when he goes out of office January 20.
And now not just you but other Republicans, well, you know, we‘re mortgaging our children‘s future. We‘ve been mortgaging it for eight years!
PAWLENTY: Well, if I could be more candid, Mike, it doesn‘t matter, it seems, in recent history for most of the years whether a Republican‘s in the White House or a Democrat or Republicans are in charge of Congress or the Democrats. They have forgotten or letten [SIC] go of the goal and the importance of balancing the budget. I believe the only way to do that is to have a requirement that the federal budget be balanced.
It‘s not just President Bush. You can also go back decades before that and see the trend line, and it‘s going up and up and up, regardless of which party‘s in control of which of those institutions. We need to have, as a country, a mechanism that says enough is enough, because they can‘t do it on their own, it seems.
BARNICLE: So now you‘ve got—you know, people in the chattering class, people who live in Washington, people who play politics all the time, whether it‘s in the media or on the floor of the House or the Senate. They‘re saying, “Oh, there‘s Pawlenty. You know, he was against the stimulus package, but now he‘s going to take the money. He‘s a hypocrite.” I don‘t—I don‘t buy that. But just tell me, what are you going to spend the money on when you get it?
PAWLENTY: Well, if I could make two quick responses to that argument.
No. 1, where was that double standard when Democratic governors or liberal governors in the past said, “I‘m against military spending, but I‘m going to take National Guard money.” Or “I‘m against No Child Left Behind, but I‘m going to take education money. Or I‘m against tax cuts, but I‘m not going to voice objection to my citizens receiving the benefits of those cuts or credits?”
So let‘s make sure we look at that argument in its full glory, and there‘s a bit of hypocrisy of the commentators who are making that argument to begin with.
Secondly, Minnesota is a substantial net contributor to the federal government. For every buck we send out there, we only get about 73 cents back. So we‘re paying the Bill where the 46 least recipient of any state in the nation of federal money.
In terms of what we‘re going to spend the money on, the federal government is telling us to how to spend the money. They put it in categories, and in Minnesota, the bulk of it is going to go into education and human services, infrastructure and some other miscellaneous categories.
But they‘re going to have us spending more money in certain categories than anybody would have ever imagined under these economic circumstances, and that‘s unusual. They‘re intervening in a very big way.
BARNICLE: Hey, Governor, we let you out of here, can you comment briefly on this cockamamie theory of mine? What do you think about the possibility that the Republican Party fractures eventually between people like you, Republicans like you, governors and some Republican mayors, who have hands on everyday jobs—you have to make decisions for people. Playgrounds, curb cuts, things like that, taxes, up and down.
Opposed—and then the other side you have perhaps another Republican Party of people in the House of Representatives who sit in safe seats, two-year terms, no opposition. All they do is, you know, raise money and run successfully. Do you think that—it could happen that there‘s a fracture there?
PAWLENTY: No. Because it‘s funny how defeat leads to pragmatism. I think that the republic—the Republican Party is going to remain a conservative party as it should, but we also need to be about growing this party. And people who agree with us 90 percent of the time or 85 percent of the time aren‘t our enemies. They‘re our friends, as Ronald Reagan said. So this needs to be a party that‘s about growth.
But in politics, you know, we‘re going to be the marketplace party. The marketplace is telling us they prefer the products and services of our competitors. If we‘re going to be a winning, growing, governing party, we need to be about including more people in, not throwing people overboard.
BARNICLE: Governor Tim Pawlenty, we want that red light go on behind the net for that Minnesota Senate seat, OK?
PAWLENTY: I do, too.
BARNICLE: Up next, FBI director J. Edgar Hoover strikes again. A total creep. You won‘t believe this one.
This is HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
BARNICLE: Welcome back to HARDBALL. Time for the Politics Fix with “Rolling Stone‘s” Matt Taibbi, author of “The Great Derangement,” one of the three greatest books ever written in the English language. And Jonathan Capehart, editorial board member of the “Washington Post.”
Jonathan, Matthew, it‘s great to see you.
Let‘s start off with J. Edgar Hoover. “Washington Post” piece this morning on the former director of the FBI who, you forget about him, because he‘s been dead for quite some time, but he was investigating Jack Valenti. Here‘s that front page “Washington Post” story right there, up on the screen.
The headline reads “Valenti‘s Sexuality was Topic for FBI.” My question: let‘s start with you, Matt. You‘re right in front of me. Have we missed the fact that this guy may have been one of the two or three biggest creeps in the history of the United States of America?
MATT TAIBBI, “ROLLING STONE”: I mean, it‘s certainly very funny news to think about J. Edgar Hoover sitting poolside with Clyde Tolson (ph) in their Speedos, ordering investigations into other—into other homosexuals. It‘s just—it‘s outrageous, but you know, at this point who really cares? I mean, it‘s so long after the fact, but it‘s interesting to...
BARNICLE: I understand the “who really cares” point? But Jonathan, the larger issue that I‘m thinking about is we live in an age of revisionist history. We‘ve had this nonsense going on now for a couple of weeks, you know, that the New Deal really didn‘t work. And if you talk to your grandparents, they‘ll tell you, “No, it worked. It worked. Because the guy gave us hope.”
But we haven‘t paid a whole lot of attention to J. Edgar Hoover, his obsession about sex, and the fact—the impact that the FBI and Hoover‘s direction of the FBI had on the body politic, the culture of this country for a period of maybe three or four decades.
JONATHAN CAPEHART, “WASHINGTON POST”: Right, right. There have been plenty of books written about J. Edgar Hoover and his excesses, his homosexuality, his obsession with other peoples‘ sex lives.
I think what makes this interesting is that it‘s just one more piece of evidence at just how far he would go just to root around into other people‘s—into other people‘s personal lives.
And as the story goes through, and it‘s a terrific story, you know, they talk to—there‘s a photographer that was rumored to be having an affair with Jack Valenti. And they interviewed—Hoover had the guy interviewed. And he admitted to being a homosexual and to finding Jack Valenti attractive, but that nothing had happened between them and that they were just good social friends.
And then at the end of the story, it points out that J. Edgar Hoover sent Jack Valenti a note on the occasion of the birth of his son. There was a letter written of congratulations to Jack Valenti by J. Edgar Hoover, and Valenti sent a letter back to Hoover, saying it would be one of the things, a letter he would treasure for the rest of his life.
Twisted, twisted man, that J. Edgar Hoover.
BARNICLE: What do you think, Matt—you read the story this morning. What do you think went through Bill Moyers‘ mind when he saw his name in that piece?
TAIBBI: Yes, I thought that—that was the one thing that really surprised me, that the news came out that perhaps Bill Moyers was doing a little investigating himself. You know, he claimed that his memory was not all that clear about this.
I think it‘s got to be very distressing for him to see his name bandied about in this very seamy affair. But you know, it‘s really very difficult to assess responsibility for all this.
But the thing you have to remember about this whole Hoover business is that I think the sex angle with all of this was largely irrelevant. This was really about power. And he was looking for some compromising information about people who were influential. And it just so happened that the compromising information involved the person‘s sexuality. I think that that‘s something that‘s kind of lost in the shuffle here.
BARNICLE: We‘re going to take a sex break right here.
TAIBBI: What?
BARNICLE: But we‘re going to be back with Mike Taibbi, who‘s very attractive, sitting in front of me, Jonathan Capehart, always attractive, for more of the “Politics Fix.” You‘re watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
BARNICLE: We‘re back with Matt Taibbi and Jonathan Capehart for more of the “Politics Fix.”
Jonathan, yesterday, the attorney general of the United States, Eric Holder, newly appointed, stepped up to the plate in talking about Black History Month and Lincoln‘s birthday, basically said that we were a nation of cowards when it came to discussing race. What do you think about that?
CAPEHART: Well, I think the attorney general used some very provocative language to have a discussion and to start a discussion that the country, I personally think, needs to have.
And let‘s not forget that this is a conversation that now two presidents of the United States and now an attorney general have asked us to have. President Clinton asked for a national conversation on race in 1997. Then candidate Obama delivered that terrific speech in Philadelphia as a result of the Reverend Jeremiah Wright mess. And then you have Eric Holder voluntarily having this conversation at a black history event at Justice.
I think it was important—it was an important speech for him to give. I think if—if I were the speech writer, I would have not have used “nation of cowards,” because it set off a debate that, I think, that takes the conversation where he doesn‘t want it to go.
What you had just earlier at the top of the show with Pat Buchanan and Michael Eric Dyson is not the kind of conversation I think he want—he wanted Americans to have.
BARNICLE: No, I agree with you. But you know, he could have avoided it and got us on the road to that conversation, I think, if he had dealt with things like Bill Cosby has dealt with, talking about the destruction, the collapse of the black family in America over the course of the last 10 or 12 years. He didn‘t really mention that in this case.
But any way, here‘s Attorney General Holder yesterday on how we, quote, “voluntarily segregate ourselves.”
(BEGIN VIDEO CLIP)
ERIC HOLDER, ATTORNEY GENERAL: Outside the workplace, the situation the even more bleak, in that there is almost no significant interaction between us. On Saturdays and Sundays, America in the year 2009 does not, in some ways, differ significantly from the country that existed almost 50 years ago.
This is truly sad. Given all that we as a nation went through during the civil rights struggle, it is hard for me to accept that the result of those efforts was to create a America that is more prosperous, more positively race conscious, and yet, is voluntarily socially segregated.
(END VIDEO CLIP)
BARNICLE: No different than 50 years ago.
TAIBBI: I think the attorney general was doing bong hits last night before he wrote this speech. I mean, this—the country is not significantly different than it was 50 years ago, except the president is black and, you know, every major institution in this country has been desegregated and we had a major civil rights brouhaha in the ‘60s and ‘70s that has already been resolved favorably. I mean, I think it‘s crazy for him to say this kind of stuff.
BARNICLE: That‘s an interesting point that you raise. Jonathan, do you think it‘s possible that Eric Holder is in the background there when Michael Phelps had the bong pipe? I mean—I mean, some of the stuff in here is, like, way out there. It‘s way out there.
CAPEHART: But you have to understand, though, that the attorney general is hitting on something that is of—that is of concern to quite a few—quite a few Americans. And that is this—this concern that we are not integrating ourselves as much as we—as much as we could and as much as we should.
I think that Holder‘s speech was—was a little too pessimistic for my taste. Even when he‘s saying something as positive and uplifting as that we have never been more racially conscious than we‘ve ever been. That‘s a fantastic thing for him to say. But it‘s wrapped around this very dour, pessimistic view of where the country is.
BARNICLE: But, you know, Matt, again, I think I understand where the attorney general was coming from. I appreciate where he‘s coming from. And yet, not to mention the collapse of the black family, teenage parenting, babies having babies. The fact that the dropout rate in many inner city schools, largely African-American, is horrendous, that adds up to the fact of why they‘re not living next door to us in the suburbs.
TAIBBI: Well, yes, that‘s one way of looking at it. I think,
obviously, you know, it‘s fair to say that we need to have serious
discussions about a lot of racial issues in this country. And I think he -
you know, it‘s important that he make that point. But by using this kind of hyperbole, he probably turned some people off to coming to that realization.
BARNICLE: Matt Taibbi, Jonathan Capehart, thanks very much.
Join us again tomorrow night at 5 and 7 Eastern for more HARDBALL. Right now it‘s time for “1600 PENNSYLVANIA AVENUE” with our old pal, David Shuster.
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