updated 3/9/2009 10:15:22 AM ET 2009-03-09T14:15:22

Guest: Matt Taibbi, Margaret Carlson, John Arensmeyer, Mike Tuffin, Rep. David Dreier, Rep. Chris Van Hollen, Bob Shrum, Bertha Coombs, Pat Buchanan

CHRIS MATTHEWS, HOST:  Sundown for recession?

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  Leading off tonight: Who you going to call?  OK, it‘s come to this, the most people unemployed in a quarter century, another 651,000 jobs lost last month alone, pushing unemployment to 8.1 percent.  You‘ve got to go back to the Reagan recession to get numbers this bad.  Does this mean we‘ve hit bottom?  And if not, does anyone know what to do about it?  Is it the zombie banks?  Is it fear of higher taxes?  Is it the Republicans who did this to us, their running up big deficits, their failure to regulate the bad guys on Wall Street?  Isn‘t President Obama scaring people with his big agenda and tax talk?  And who the heck is going to get to the heart of this trouble and fix it before this economy drops through yet another floor?

President Obama was in Columbus, Ohio, to highlight how his recovery plan saved 25 police recruits‘ jobs.  So let‘s see, that‘s 25 jobs saved and 651,000 jobs lost in the last month.  Can‘t call this a good deal.  Does the president have a solid plan to save us?  Does his Treasury secretary, Tim Geithner?  Does anyone?  Does inside man Larry Summers?

Also, does anyone sense the influence of the Clintons in the Obama White House, the strategy of elevating Rush Limbaugh to poster boy status?  Is this smart to make him Mr. Republican?  Is this out of the old Clinton playbook, find a bad guy and fight him?  Why does a post-partisan president need to have a partisan enemy?  And why is Barack Obama letting the old mindset of the ‘90s get in the door?

Plus, speaking of Clinton-era politics, watching the participants in the president‘s health care summit yesterday was like taking a trip back in time, but there‘s a big positive exception.  Some of the players in the room yesterday were the very people who derailed Hillary Clinton‘s health care plan 15 years ago.  They now want to make it work with President Obama to overhaul the health care system.  And it sounds good.

The Republican chairman, Michael Steele, says he wants to enroll his party in a 12-step program to recovery.  Meanwhile, some Republicans are suggesting a one-step program for Steele: Go.

And who‘s this public official getting slimed by green goo?  And who did it and why?  We‘ll have more of that in the “Sideshow.”

Let‘s start with today‘s grim economic numbers -- 651,000 jobs were lost last month.  In January, we lost 655,000 jobs.  And back in December, we lost 681,000 jobs.  All told, a total of 4.4 million jobs have been slashed since the recession began in December of ‘07.

Let‘s bring in Democratic congressman Chris Van Hollen of Maryland, who‘s a member of the Ways and Means Committee and chairman of the Democratic Congressional Campaign Committee.  Congressman Van Hollen, thank you.

REP. CHRIS VAN HOLLEN (D-MD), DCCC CHAIR:  Good to be with you.

MATTHEWS:  Whose fault is all this?  Let‘s bring in Republican David Dreier of California, as well, to keep it balanced.  Gentlemen, I want to try to figure this out.  We had a bad economic situation in October, in November going into the election, and now it‘s worse.  Whose fault is it and what do we do about it?

VAN HOLLEN:  Well, look, I mean, the problems have been mounting.  You had huge numbers of job losses in October, November, December, January, February.  What‘s happened is we‘ve obviously dug ourselves in a very deep economic ditch.  What President Obama has done with the new Congress from day one says we‘re going to focus on turning it around.  We passed an economic recovery plan.  Unfortunately, not a single Republican in the House voted for it.  We got three Republicans in the Senate.

He‘s got a housing foreclosure plan and they‘ve got a plan to deal with the credit freeze in the markets.  These things all have to click together.  We‘ve got to have all cylinders clicking in order to turn it around.  Remember, the first shovel-ready project just broke ground this past week.  So it‘s going to take time, and the American people understand when you dig yourself this big a hole, it takes a little time to turn it around.

MATTHEWS:  Congressman Dreier, why all the nervousness on the market?  Why are the markets—until today, they stabilized a bit because of the perversity of Wall Street, whereby when you have a bad unemployment number, like 8.1 percent today, the highest since the Reagan recession, and the markets stabilized.  But for weeks now, it‘s been going down.  Why?

REP. DAVID DREIER ®, CALIFORNIA:  Well, Chris and Chris, we know that it is going down because we are seeing the market predict what is down the road six months.  And it is clearly not optimistic.  The American people are hurting.

The other day, I heard of a tragedy.  A friend of mine told me of a suicide of a father who has three young children.  We have homes being lost.  We have businesses closing down.  It is very, very painful.

So you‘re saying what is it that caused this?  Well, I think that what we need to do is we need to focus on where we‘re going right now.  And while it may sound esoteric, we need bold, robust, strong economic growth policies like John F. Kennedy put into place in 1961 and Ronald Reagan in 1981.  Now, that may sound esoteric, but what it means is, it means allowing families to keep their homes and being able to pay their bills, allowing kids to have college funds necessary...

MATTHEWS:  Right.  But we...

DREIER:  ... allowing business—that‘s the kind of policy we need to put into place.

MATTHEWS:  That‘s what you said—but that‘s what you said back in 2001 that started this whole shebang.

DREIER:  It did not start this shebang!

(CROSSTALK)

MATTHEWS:  ... that you‘re selling are what led us to where we are now.  This is Bush politics you‘re talking about.

DREIER:  Chris—wait a second, Chris.  You just began this piece by talking about the fact that this number, the 0.5 percent increase in unemployment, is the largest in 25 years since the recession that began during the Reagan administration...

MATTHEWS:  Right.

DREIER:  ... at the end of the Carter administration, that Ronald Reagan inherited with numbers even higher than those that we have today.

MATTHEWS:  No, I was talking 1983, actually.

DREIER:  No, no, let me just tell you.  The numbers were in many ways even higher than they are today.  Here‘s the point.  Let‘s look at the policies that were put into place that led to the bold economic growth that allowed people to plan for college, keep their homes...

MATTHEWS:  Right.

DREIER:  ... keep their businesses going and create jobs.  And that‘s the policy that we should be putting into place today.

MATTHEWS:  OK...

DREIER:  Plus reducing the size and scope and reach of government. 

With all of this spending, it has gone way overboard...

MATTHEWS:  OK.  You‘re...

DREIER:  ... but we do need infrastructure spending.

MATTHEWS:  But tax cuts is what we did through President Bush‘s presidency...

DREIER:  Marginal rate reductions.

MATTHEWS:  ... and it left us where we‘re at.

VAN HOLLEN:  No, no.  Look...

DREIER:  Marginal rate reduction, Chris, is what we need.

VAN HOLLEN:  Look, the American people are much smarter than that.  They know what we need.  Number one, we need investment.  When the private sector...

DREIER:  Absolutely.

MATTHEWS:  ... is not investing, when the credit markets are frozen, you got to invest.  We invest in transportation.  We provide some help for our states so they can keep investing in education and health care.  And we provide tax cuts.  Thirty-six percent of the economic recovery bill we passed put more money directly into the pockets of Americans.  It wasn‘t the wealthiest Americans, the very top that benefited for the last six years.  It was people who were actually going to go out and spend that money.  You talk about keeping more people in their homes, we just passed a bill to do exactly that, to provide people relief...

DREIER:  That perverts the market!

(CROSSTALK)

DREIER:  It perverts the market, Chris, by having...

VAN HOLLEN:  David—David...

DREIER:  -judges—having bankruptcy judges set interest rates and what principal level, decreasing the value of homes across the country.

VAN HOLLEN:  David, you know what it does.  It allows a bankruptcy judge to take into consideration all the factors.  If a bankruptcy judge thinks that somebody is overextended, they say foreclosure.  But if they think that the bank is being unfair, they have the opportunity to intervene.  In fact, by having the option for bankruptcy, what you allow is you give the home owner finally a little bit of leverage in negotiation with the banks...

DREIER:  We don‘t want to undermine the ability...

VAN HOLLEN:  ... so they can cut a deal.

DREIER:  ... for bankruptcy to be filed.  We don‘t want to undermine that ability.  But I‘ll tell you what.  We do not want to pervert the market.  You know, we had Gordon Brown address us in a joint session of Congress day before yesterday.  And he talked about the need to have a commitment to the free market, but it can‘t be value-free.  And I acknowledge that there have been a lot of bad apples out there, and the American people are angry and I‘m angry and we need to do everything that we can to crack down on that.

But I believe that we have gone way overboard.  Just read Stewart Taylor‘s piece in today‘s “National Journal.”  He describes himself as an Obama-friendly—an Obama-friendly—not quite supporter, but he‘s an Obama-friendly guy.  He‘s a centrist.  He describes himself as a centrist.  And in it, he decries the kind of spending, the reach that we have in all of these programs.

You know, we lost private sector jobs.  We shouldn‘t be focusing on creating more and more government jobs.  What we need to do is we need to have these pro-growth policies that will create private sector jobs that will be long-term jobs.  That‘s how we sustain the economy.  And it‘s not a Republican issue.  John F. Kennedy did it in 1961 and we need to do it today!

VAN HOLLEN:  David, that‘s exactly what this plan did.  It invests in private sector jobs.

DREIER:  The Kennedy plan?

VAN HOLLEN:  What do you think transportation jobs are?  What do you think the energy infrastructure market is?

DREIER:  I‘m all for...

VAN HOLLEN:  What do you think...

DREIER:  Chris, I‘m all for infrastructure spending...

(CROSSTALK)

VAN HOLLEN:  David, let me just say, these are private sector investments.  We also did the tax cuts, including business incentives so that people would be able to carry back their—carry forward their losses so they‘d get some income they could spend right now.  You guys are just say no to everything.

DREIER:  Oh, no!  Come on, Chris!

VAN HOLLEN:  You said no to this plan.

DREIER:  Now, let me just tell you...

VAN HOLLEN:  You said no to the housing plan.

DREIER:  I‘m going to stop you right there on that one...

VAN HOLLEN:  David, it‘s been no, no, no.

(CROSSTALK)

DREIER:  No matter how many times you say no, Chris, you know full well...

VAN HOLLEN:  David...

DREIER:  ... that we came forward having listened to small business owners, listened to workers, and we provided a very viable alternative modeled after exactly what I just said...

VAN HOLLEN:  Yes.

DREIER:  ... which reduced marginal rates and would, in fact...

VAN HOLLEN:  David...

DREIER:  I mean, 3 percent...

MATTHEWS:  OK, let me...

(CROSSTALK)

MATTHEWS:  The people watching this program...

VAN HOLLEN:  ... the same old thing that we saw before.

MATTHEWS:  ... right now are trying to figure out the following.  How do they know whether what President Obama has tried is going to work?  Congressman Van Hollen, how many months do we need now to find out whether this big stimulus bill that was passed and signed recently is going to work?

VAN HOLLEN:  Well, it‘s already working...

MATTHEWS:  How many months do we need to have?

VAN HOLLEN:  It is already working in the sense that people who would have otherwise...

DREIER:  Oh, my God!  Look at where we are!

VAN HOLLEN:  It is, David.  People who would have otherwise been out of work now have their jobs.  The president just talked today about some of those jobs in my state of Maryland.  There were going to be lots of layoffs in the construction industry.

MATTHEWS:  So the 8.1 percent...

VAN HOLLEN:  They‘re not there now.

MATTHEWS:  ... unemployment rate is...

(CROSSTALK)

VAN HOLLEN:  Let me put it this way.  When you have a down escalator and you‘re trying to get up a down escalator...

MATTHEWS:  Right.

VAN HOLLEN:  ... the fact of the matter is, if you‘re standing still and doing nothing, you‘re going to go backwards fast.  Now, we have no idea how fast this down escalator is coming, but to say that it‘s not working when people who otherwise would be losing their jobs...

DREIER:  Chris, I hope...

VAN HOLLEN:  ... would be out of jobs...

MATTHEWS:  Here‘s the president today...

DREIER:  I hope...

(CROSSTALK)

MATTHEWS:  Congressman Dreier, you come in after this.  Here‘s the president.  Respond to him.  Here‘s the president today in Columbus.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  So for those who still doubt the wisdom of our recovery plan, I ask them to talk to the teachers who are still able to teach our children because we passed this plan.  I ask them to talk to the nurses who are still able to care for our sick and the firefighters and first responders who are still able to keep our communities safe.  I ask them to come to Ohio and meet the 25 men and women who will soon be protecting the streets of Columbus because we passed this plan.

(END VIDEO CLIP)

DREIER:  Chris...

MATTHEWS:  Well, the problem is there—let me go to Congressman Dreier.  Here‘s the question.  What do you buy about the escalator going down, and we‘re trying to run up the escalator, and if we don‘t do anything, we keep going down, but if we keep going up, running as fast as we can, we still don‘t know what we‘re up against?  What do you think that Barack Obama inherited in terms of economy?  When he walked in the door, what was he facing?  That‘s all I want to know from you now.

DREIER:  He inherited an economy that because of a lot of problems was, in fact, headed down.  We all acknowledge that.  We need to decide where it is that we‘re going.  The president in Columbus was just talking about motherhood and apple pie.  We all want to focus on teachers, obviously, law enforcement and firefighters and nurses.  Those are important priorities.

But the fact is—and Chris has just been talking about infrastructure spending.  Three percent of this package in the stimulus bill was focused on infrastructure.  What needs to be done is we need to make sure that we focus on private sector creation of jobs right now, and that is not being done.  To argue that an $800 billion—really, $1.3 trillion—bill with all of these other spending plans out there are going to create good private sector jobs is really absolutely beyond the pale.

MATTHEWS:  Chris?

VAN HOLLEN:  If I could respond?  I mean, first of all, I mentioned the private sector jobs.  David says we all want to keep the teachers in the classroom.  We all want to keep the nurses on the job.  But the fact of the matter is, if we hadn‘t passed the economic recovery bill, states would be laying off people.  In my state, the governor had planned to lay off 700 people, firefighters, teachers.  They now can keep their jobs.  They can keep spending money in the economy, so you try and avoid that downward spiral.

Look, this thing was going down fast.  I mean, when Barack Obama took office, you had a very fast down escalator.  We are trying to make sure that we turn things around.  No one knows how fast or deep this will go.

DREIER:  The last time...

VAN HOLLEN:  But to do nothing—to do nothing or to just say we‘re going to do what we used to do for eight years...

DREIER:  Chris, we‘re...

VAN HOLLEN:  ... that got us into the mess...

DREIER:  Come on!

VAN HOLLEN:  ... is not an answer.

DREIER:  Quit saying that we‘re going to do nothing!  You know very well, the last time...

VAN HOLLEN:  David...

DREIER:  ... that this model was—the last time that this model was followed was in the 1930s, and Henry Morgenthau, FDR‘s Treasury secretary in 1939 said, We‘ve tried spending money, we‘ve spent more money than we‘ve ever spent before, and we have an unemployment rate today that is higher than we—the same rate as when we began, and an enormous debt to boot.  That‘s the last time this model was tried.

And I believe we, as Americans, we‘re going to recover, but we‘re going to recover in spite of, not because of this package that we‘re dealing with.

VAN HOLLEN:  Let me just say, David...

MATTHEWS:  OK, thank you.

VAN HOLLEN:  ... the American people said Roosevelt got it right.  They said it in four straight elections.  He must have been doing something right.

DREIER:  Well, let me—let me just tell you—let me tell you...

(CROSSTALK)

VAN HOLLEN:  He must have been doing something right by the American people because his program had the support of the American people.

DREIER:  I will tell you...

MATTHEWS:  OK, we‘re going to have to stop it right here because this debate‘s going to continue.

(CROSSTALK)

DREIER:  ... and say it about Ronald Reagan.

MATTHEWS:  OK, thank you very much, Congressman Chris Van Hollen, Democrat...

DREIER:  OK, fellows.  Have a good weekend.

MATTHEWS:  ... and Congressman David Dreier, Republican of California.

Coming up: The White House fight against Rush Limbaugh smacks of, I think, Clintonian politics.  Is this a smart strategy for a president who promised post-partisan Washington?  Two heavyweights, Pat Buchanan and Bob Shrum, face off in the Obama/Rush fight.  We‘re having one here.

You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  President Obama promised a break from the past.  He said no more Washington infighting, no more political gamesmanship.  But after weeks of the Rush Limbaugh saga, isn‘t there something a little Clintonian about this fight that the White House seems to have picked with Rush?

With us now MSNBC political analyst Pat Buchanan and Democratic strategist Bob Shrum.

Pat, it seems like, based upon the narrative we‘re getting, this saga, all this, it started with a poll taken last October by Carville and Begala, and they basically suggested that that was a good fight to make for the president.  He was an unpopular figure, Rush Limbaugh, back in October.  And apparently, that was passed along to the White House.  We‘re not getting any denials along that lie.

Is this smart, to pick a bad guy out there and say, He‘s the enemy, we‘ve designated our opposition leader?

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  I think it‘s a perfect tactic, an excellent tactic to use in a campaign to designate someone who represents the other side and doesn‘t have any reach, basically, you feel, in the people you need to get.

But Chris, Barack Obama is president of the United States.  He came in as a post-partisan president.  He‘s been reaching out to Republicans.  And to get this Begala/Carville/Rahm tactic and have a great good time all week in this crass political fight, it hurts the president because it moves him into a total partisan vein.  And frankly, later in the week, they‘re in a fight with Rush Limbaugh.

What in heaven‘s name, when the market has lost 55 percent to 60 percent of its value, people are concerned, 650,000 out of work, and here they are arguing with Rush Limbaugh, the White House, right from the podium in the West Wing!  It‘s a terrible mistake.  They ought to get down to business.  They‘re good at politics.  They have not shown yet, Chris, they are good at governing.

MATTHEWS:  Bob Shrum.

BOB SHRUM, DEMOCRATIC STRATEGIST:  Well, first of all, if you pass a bill as big as they passed, as fast as they passed right at the beginning of the presidency, they‘re pretty good at governing.  Secondly, the person who‘s hurt here or the group that‘s hurt here are the Republican Party.  Rush is helped because it helps build his audience.

MATTHEWS:  His numbers are doubled.

SHRUM:  Yes.  The president is helped and Democrats are helped because he‘s got a 15 percent approval rating in that poll.  I mean, I was—I helped found the Democracy Corps which took that poll.  I left it when I went to the Kerry campaign because it would have been a conflict of interest.  And of course they had this conversation.  If you saw a poll and it said this guy had 15 percent approval, you‘d tell—Carville would tell Rahm.  I mean, it‘s...

MATTHEWS:  You think that number—do poll numbers hold up four months, though?  Do we think Rush is in that same shape right now?

SHRUM:  Oh, I think he‘s probably worse shape.  After that CPAC appearance...

MATTHEWS:  Yes.

SHRUM:  ... you know, bouncing up and down...

BUCHANAN:  What is...

SHRUM:  I mean, he‘s—look, this isn‘t like Clinton in ‘93 or ‘96 fighting with Newt Gingrich.

MATTHEWS:  Well, here‘s—let‘s get a peek at this, the way this thing developed here.  Here‘s Paul Begala, who‘s a smart guy, with Anderson Cooper, who‘s a good reporter, on Wednesday night.

(BEGIN VIDEO CLIP)

ANDERSON COOPER, HOST CNN “360”:  But clearly, if you‘re talking to Rahm Emanuel every day on the phone and this light bulb has gone off in your head and James Carville‘s head, I find it hard to believe you didn‘t say to Rahm Emanuel, Guess what?  Look at these poll numbers?

PAUL BEGALA, DEMOCRATIC STRATEGIST:  Oh, I don‘t know.  I don‘t keep terrible (ph) notes for these things.  My view is I keep private conversations private, Anderson.

ANDERSON: OK.

(END VIDEO CLIP)

MATTHEWS:  Well, that‘s a non-denial.

(LAUGHTER)

(CROSSTALK)

MATTHEWS:  That‘s how we say it in this business.  You just say, I‘m not denying it.  So obviously, you‘re right, Pat, they have shared.  They are all smart guys.  They think this is—my worry is...

BUCHANAN:  Chris...

MATTHEWS:  ... as the economy gets worse, that Rush Limbaugh has been smart to go back to the Republican core, which is self-interest—taxes.  And that‘s a strong fight for the Republicans.  They always do well when they defend against high taxes.  They always win on that point.

BUCHANAN:  Chris, what is the White House—Barack Obama, president of the United States, we have elected him.  I think almost everybody wishes him well, because, if he fails, the country fails.  What are they doing getting in this silly partisan fight with Rush Limbaugh and the Republican Party?

MATTHEWS:  OK.

(CROSSTALK)

MATTHEWS:  There may be an issue that has developed today.

Let‘s take a look at what Rush Limbaugh said today about the health care bill that‘s now being fought for, which a lot of people want, including a lot of businesspeople—we talk about it more in the show.  It‘s not just a left-vs.-right fight anymore—and what he said about Senator Ted Kennedy. 

(BEGIN AUDIO CLIP, “THE RUSH LIMBAUGH SHOW”) 

RUSH LIMBAUGH, RADIO TALK SHOW HOST:  We have a banking and a credit crisis.  Obama and his team had a show gathering to focus on the problem.

But they have done little, if anything, to so much as start fixing it.  Any leader would keep focused on fixing that mess.  But that‘s not the stuff that makes approval numbers rise, because there really isn‘t much he can do, except shift people‘s attitudes about it. 

So, he‘s moved on to health care.  This is highly visible.  It‘s news-leading, gets a great focus.  Plus, it has the great liberal lion, Teddy Kennedy, pushing it.  Before it‘s all over, it will be called the Ted Kennedy memorial health care bill. 

(END AUDIO CLIP)

MATTHEWS:  Well, what do you make of that? 

SHRUM:  It‘s outrageous.  It‘s typical of him.  He‘s—he‘s a tasteless guy.  He will say anything.  He appeals to haters. 

MATTHEWS:  Yes. 

SHRUM:  And he is the face of the Republican Party right now, because no one else is doing a very good job and because he went to CPAC. 

Look, this is not like the ‘90s.  Gingrich, at his worst, was massively popular compared to Rush Limbaugh.  And stuff like this is just going to make it more difficult. 

(LAUGHTER)

BUCHANAN:  Well, will you tell me what you guys are doing?  The country is in a horrible mess.  You have got the White House.  You have got both houses of Congress.  You have got a horrendous crisis.

Since the guy has been inaugurated, the market has gone into a bear market...

SHRUM:  Oh.

BUCHANAN:  ... since he‘s inaugurated.

And you‘re out there getting in a fight with Rush Limbaugh.  You guys won the White House. 

SHRUM:  Pat, Pat, Pat, Pat, utter drivel. 

(LAUGHTER)

SHRUM:  Nobody can blame the unemployment that we now have or this week‘s—or this month‘s unemployment numbers or what‘s happened to the market on—on this president. 

This president has just started in.

BUCHANAN:  All right. 

SHRUM:  And he‘s going to be judged by results. 

And, by the way, I do not believe the country sees this...

BUCHANAN:  Right. 

SHRUM:  ... as a fight between Rush Limbaugh and the president of the United States. 

BUCHANAN:  OK.

SHRUM:  I think they see the president out there in Ohio fighting for jobs, fighting to make this economy better, fighting on health care...

(CROSSTALK)

SHRUM:  ... the Republican Party. 

(CROSSTALK)

MATTHEWS:  Take a look at this chart.  Look at this chart.  Reality check.  Take a look at this chart on the Dow Jones since President Obama has been in office. 

It shows the problem we all face right now.

BUCHANAN:  Right. 

MATTHEWS:  This drop in the economy did not stop dropping after Election Day—since Election Day. 

Look what it‘s done since Election Day. 

(CROSSTALK)

BUCHANAN:  Now, Chris, what has happened...

MATTHEWS:  This is—in other words, the market, which is a lot of Republicans up in New York, a lot of market people, who don‘t like what they hear coming from Obama. 

BUCHANAN:  Chris, it is people who want to make money. 

SHRUM:  That‘s not what happened?

MATTHEWS:  Isn‘t it?

BUCHANAN:  Chris, what‘s happened?  He‘s got a stimulus bill and he‘s got it through, $600 billion or $800 billion.  He‘s got his housing bill.  Geithner has got his bank bill.  And we have got his budget. 

And the whole country, people with money, are saying, this isn‘t going to work.  The stock market is a lead indicator.  It tells you where the economy is going to be six months from now.  It‘s a vote of no confidence in Barack Obama. 

Please, Mr. President, address this, and get off this Mickey Mouse stuff with... 

(CROSSTALK)

SHRUM:  Pat, this is a whole new theory no one has ever brought up. 

It‘s never been a leading indicator. 

(CROSSTALK)

BUCHANAN:  A lead indicator.

(CROSSTALK)

BUCHANAN:  ... economics.

(CROSSTALK)

MATTHEWS:  If the market is so smart, why...

(CROSSTALK)

MATTHEWS:  ... billions and trillions of dollars in the marketplace? 

All these traders have all lost a trillion dollars. 

(CROSSTALK)

BUCHANAN:  Chris, you...

(CROSSTALK)

BUCHANAN:  ... understand what a lead indicator is.

(CROSSTALK)

SHRUM:  The market lagged what was happening in the real economy up until a few months ago.  And Barack Obama is not responsible for what‘s driving the market down...

BUCHANAN:  Chris..

SHRUM:  ... which are these numbers that are coming—coming out that are showing profits collapsing in all these companies. 

BUCHANAN:  Chris, the market is down...

SHRUM:  And you know what Obama does that‘s really smart?

BUCHANAN:  I know—tell us how smart he is. 

SHRUM:  We can sit here and argue.

BUCHANAN:  OK.

SHRUM:  I‘m going to tell you.  He says very straightforwardly to the country, I will be judged by results, and I‘m content with that. 

BUCHANAN:  All right. 

SHRUM:  So, if people are going to predict doom...

(CROSSTALK)

BUCHANAN:  Chris, let me tell you about a lead indicator.

MATTHEWS:  When is it fair to judge Barack Obama‘s economic program? 

BUCHANAN:  Ultimately...

MATTHEWS:  Our polling shows that people will begin to judge it a year or so from now, a year or two from now.  Would you say we can judge it right now, his economic program?  Can we judge it today? 

(CROSSTALK)

BUCHANAN:  You can‘t judge it finally, of course not. 

But, Chris, when I say a leading indicator, the market, in other words, when it starts down, the real economy doesn‘t start down until six months later.  The real economy stayed pretty well as the market was telling us where it‘s going.  That‘s what economists mean by lead indicators. 

Unemployment is a lag indicator.  It follows what is happening...

(CROSSTALK)

SHRUM:  The real economy was in lousy shape before the stock market started going like this. 

MATTHEWS:  I think we‘re all right. 

(LAUGHTER)

MATTHEWS:  Anyway, thank you, Pat Buchanan.

Thank you, Bob Shrum. 

BUCHANAN:  I would dissent on that.

(LAUGHTER)

MATTHEWS:  Up next: lost in translation.  Secretary of State Hillary Clinton gives her Russian counterpart a joke gift, but the joke ended up on her.  Apparently, the translators at the Department of State are not what they used to be. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Back to HARDBALL.  Time for the “Sideshow.”

First up: Twittering over frittering.  That‘s about it for John McCain.  He‘s using state-of-the-art communications to sell his vintage argument, that the U.S. Congress wastes big money on small-minded projects that benefit the few. 

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN ®, ARIZONA:  As some of my colleagues may know, I have begun to Twitter.  And we have been tweeting for the last week with top 10 earmarks every day.  There‘s—we could go on for days and days and days. 

(END VIDEO CLIP)

MATTHEWS:  Well, here‘s just some of what Senator McCain Twittered out today, tweets on what he labeled the top 10 porkiest projects: $228,000 for streetscaping in Bridgeville, Pennsylvania; over a million dollars for the Rolls-Royce company; $75,000 for something called the Totally Teen Zone in Albany, Georgia. 

I think this lampooning of these things is fun, but McCain has got a bigger point.  Congress is spending big money, as I said, on small-minded things that matter to the few. 

Next up:  Say this for Hillary Clinton.  She‘s having a good time overseas.  Here‘s the secretary of state in Geneva presenting the Russian foreign minister with a button that was supposed to say “reset” in Russian.  Things didn‘t go as planned. 

(BEGIN VIDEO CLIP)

HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE:  I wanted to present you—represents what President Obama and Vice President Biden and I have been saying.  And that is, we want to reset our relationship. 

And, so, we will do it together. 

(LAUGHTER)

UNIDENTIFIED MALE:  Thank you very much.  Thank you. 

CLINTON:  You‘re very welcome.  We worked hard to get the right Russian word.  Do you think we got it? 

UNIDENTIFIED MALE:  You got it wrong. 

CLINTON:  I got it wrong. 

(LAUGHTER)

UNIDENTIFIED MALE:  It should be perezagruzka. 

CLINTON:  Oh.

UNIDENTIFIED MALE:  And this says peregruzka, which means overcharged. 

(LAUGHTER)

CLINTON:  Well, we won‘t let you do that to us, I promise. 

(LAUGHTER)

UNIDENTIFIED MALE:  OK.  Thank you very much. 

CLINTON:  Thank you so much.

UNIDENTIFIED MALE:  It‘s very kind of you.  It will be on my desk. 

(END VIDEO CLIP)

MATTHEWS:  Talk about a failure to communicate—communicate.  I would say we were overcharged for that gadget itself. 

And, sometimes, working in government is a dirty job.  Just take a look at what happened to this unfortunate economic official over in London today.  While arriving at a meeting about reducing carbon emissions, a protester hit him in the face with green custard. 

Hmm.  She was protesting the addition of this third runway at Heathrow Airport.  The official took the incident in good spirits, saying, “I‘m prepared to take my share of the green revolution on my shoulders, but I‘m less keen on having it in my face.”

Now for tonight‘s “Big Number.” 

Last night, we gave the HARDBALL Award to Rush Limbaugh for managing to fill the political stage, despite never having been elected to anything.  Well, all the attention is paying off for him. 

According to “Talkers” magazine, Rush‘s radio audience was 14 million before this week began.  And now, thanks to being declared enemy number one by the White House, look at the crowd he‘s gotten, 25 million people listening to this guy, nearly double what it was.  Talk about a stimulus program. 

Maybe the president should attack everyone, and we would all get rich. 

The radio man‘s 25 million listening army—today‘s “Big Number.” 

Up next:  President Obama vows to reform the health care system this year, and he has the support of some key people who helped—catch this—the same people who helped kill Hillary Clinton and Bill Clinton‘s efforts back in the ‘90s are on the other side now.  Times have changed.  The worm has turned.  The cosmos has shifted.  Some the bad guys are becoming perhaps the good guys. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

BERTHA COOMBS, CNBC CORRESPONDENT:  I‘m Bertha Coombs with your CNBC “Market Wrap.”

A late-day rally pushing the Dow to a positive close, not a huge, spectacular rally, but it was another rough week on Wall Street.  So, the positive close was better than nothing, the Dow up 32 points, the S&P 500 just a fraction, the Nasdaq five points in the red. 

The late-day surge came on a “Wall Street Journal” report that Lloyds Banking Group has reached a deal with the U.K. government for an asset protection plan that is worth about $250 billion. 

A jump in oil prices lifted energy stocks and helped offset a sell-off in tech shares.  Crude closed just above $45 a barrel, a gain of more than 4 percent. 

And there was an unexpected rise in consumer borrowing in January, after three months of declines.  Economists say there is pent-up consumerism out there, but they are standing by predictions that borrowing will remaining weak for the rest of this year.  That‘s from CNBC, first in business worldwide—now back to HARDBALL. 

MATTHEWS:  Welcome back to HARDBALL. 

President Obama held his breath—or his health care...

(LAUGHTER)

MATTHEWS:  ... held his breath—held his health care summit yesterday—probably held his breath, too.  And many of the players who torpedoed Hillarycare, if you will, back 15 years ago, are now pledging to at least work with the president to come up with a health care reform bill. 

So, what‘s bringing them to the bargaining table?

Michael Tuffin is executive vice president of America‘s Health Insurance Plans, the group that ran that infamous, if you will, Harry and Louise—I don‘t think you think so, but a lot of people thought it was an infamous ad which helped defeat Hillary Clinton‘s health care plan back in 1994.  And John Arensmeyer is the founder and CEO of the Small Business Majority. 

Mike and John, this is a time to begin this discussion.  We will have it for months here on this show.  A lot of people work very hard and don‘t have health care.  My concern is that they get health care. 

OK.  What‘s changed—you first, John—from the fight Hillary and bill fought, nobly, but unsuccessfully, back in the early ‘90s.  What‘s different in terms of the Chamber of Commerce, businesspeople, pharmaceuticals, hospitals, nurses, doctors?  What is the thinking—how is the thinking different this time? 

JOHN ARENSMEYER, FOUNDER AND CEO, SMALL BUSINESS MAJORITY:  Well, it‘s just gotten a lot worse.  I mean, small business is being killed by the health care crisis.  Small business pays an average of 18 percent more than big business for health care. 

The biggest reason that 50 percent of small businesses can‘t offer health care is cost.  So—and if we‘re serious about...

MATTHEWS:  So, you‘re—here‘s my favorite example.  Help me on this.

You‘re a barber.  Think of the old-time barbershop.  They don‘t wash your hair.  They just cut it, right, just a couple little flags in the window. 

ARENSMEYER:  Right. 

MATTHEWS:  Charge about whatever, 10, 15 bucks, whatever it is, OK? 

They have three barbers.  Two of the guys—one of the guys owns the place.  Two work there.  The two guys that work there get about 75 percent of the haircut, right?  But then the owner has got to get them health care, right?  He can‘t afford that health care, right?

ARENSMEYER:  Right. 

MATTHEWS:  That‘s it.

ARENSMEYER:  That‘s it.

MATTHEWS:  That‘s it.  The guy works all day.

(LAUGHTER)

MATTHEWS:  He tired when he goes home.  He‘s got a skill.  He doesn‘t have health care.  How would—what‘s—what do—what do—how do we deal with those situations? 

ARENSMEYER:  Well, we have got to do a number of things.  And this is why the president‘s plan, the framework he has presented, is really where we have to start. 

We have got to get control of costs.  We have got to deal with, you know, key quality and prevention issues.  And we have got to get everybody covered.  Until we get everybody in the system...

MATTHEWS:  OK. 

ARENSMEYER:  ... it‘s not going to be affordable. 

MATTHEWS:  Some of our kids disagree with this.  I‘m one of those who believes, with Hillary Clinton, you don‘t have shared cost on health care until the young and the healthy share in the cost of dealing with the older and the unhealthy. 

Most health care costs come at the end—we know that—because you try to save life at the end, right?

ARENSMEYER:  Right. 

MATTHEWS:  Young people in their 20s can hop, skip and a jump through life.  They can go out and get hammered every night.  They can have the time of their life.  They can sleep two hours a day, eat all the wrong food, and never gain a pound and be healthy as hell.  That‘s the way God made us, right?

They don‘t believe they need health care.  And most of them don‘t, right? 

ARENSMEYER:  The young invincibles, they‘re called.

MATTHEWS:  Right.  So, we have got to get them to pay some health care payments, right? 

Do you agree with that? 

ARENSMEYER:  That‘s right.  Yes. 

(CROSSTALK)

MATTHEWS:  Do you agree with that?

MIKE TUFFIN, EXECUTIVE VICE PRESIDENT, AMERICA‘S HEALTH INSURANCE

PLANS:  Entirely.

MATTHEWS:  Get everybody insured? 

TUFFIN:  Get everybody in the system, absolutely.

MATTHEWS:  OK.  What has changed in your business—anything—the insurance business? 

TUFFIN:  Well, sure. 

This time, we‘re coming to the table with solutions.  We want to be part of the process.  We pledged that to the president.  We‘re calling for new regulations on our industry to make sure everyone has guaranteed access to coverage.

MATTHEWS:  OK.  The barbershop, classic American institution, how do we get those—those assistant barbers who don‘t own the shop, who work for—per haircut, how do we get them insured? 

TUFFIN:  Right. 

First, let‘s give them tax credits, health care tax credits for working families. 

MATTHEWS:  But are they making enough for that tax credit to help pay their health care?

TUFFIN:  Well, if they‘re not, you make that tax credit advanceable and you make it refundable, so it hits people on the lower end of the economic ladder. 

Let‘s make those tax credits advanceable and refundable, only for the use of health care.  Let‘s require insurance companies to offer a policy to all comers.  But let‘s insist that everyone be a part of this system, so, the pool is—is broad and the risk is shared. 

MATTHEWS:  How do we get health insurance companies to come through when they have to pay? 

TUFFIN:  Well, we do that right now.  I mean, Chris, we...

MATTHEWS:  That‘s not the way most people look at it. 

TUFFIN:  Well, if you think about the fact...

MATTHEWS:  You guys hire professionals now, don‘t you, to disallow payments to people?

TUFFIN:  We hire professionals to focus on management of...

MATTHEWS:  To make sure people don‘t get the money that they—they thought they were going to get when they got sick. 

TUFFIN:  Well, how could that be the case if we...

(CROSSTALK)

MATTHEWS:  I‘m sorry.  I‘m starting a fight. 

TUFFIN:  You‘re starting a fight...

MATTHEWS:  I‘m not going to start a fight. 

TUFFIN:  ... that you‘re not going to win. 

MATTHEWS:  This is why we‘re—no, I sometimes win. 

(LAUGHTER)

MATTHEWS:  But I just want to stop the fight, because that‘s my—we have got to stop this fighting around the table. 

Let‘s go back to my big question.  Things have changed.  I heard today in the paper the U.S. Chamber of Commerce, a friend of mine, Tom Donahue, he‘s talking about health care.  He wants to deal.  How do you take together a business mentality—you folks work for business—with a liberal point of view, human rights concern?  The people on the political left just want to help working poor people, very poor people get Medicaid.  Working poor people, who show up for 40 or 50 hours a week, don‘t get health care now.  They want to get that. 

Business wants to reduce its cost.  We can‘t compete with Canada for making cars, because they have national health up there.  How do we bring those two sides together?  You first, the liberals and business. 

ARENSMEYER:  Of course it‘s a moral crisis.  We all accept that.  But it‘s an economic crisis that‘s killing us. 

MATTHEWS:  Can Ted Kennedy agree with Schwarzenegger, his brother-in-law or his relative, can he agree with Mitt Romney, with those Republican approaches in those states? 

ARENSMEYER:  Absolutely, you mentioned Schwarzenegger.  We‘re based in California, and the Democrats in the legislature and Schwarzenegger agreed on a health care plan a year ago.  There‘s definitely opportunity for common ground.  We‘re talking to people on both sides of the aisle.  And there‘s a tremendous interest on both side of the aisle to get something done. 

But we‘ve got to get—from a small business standpoint, we have to get that taken care of, because if we‘re talking about an economic recovery, traditionally small business is responsible for 100 percent of the net new jobs at the beginning of the economic recovery.  So if we don‘t take care of that, we‘re not going to recover.  We‘re not going to take control of the budget deficit.  This is an economic crisis—

MATTHEWS:  I‘m with you.  I like you with business.  Let‘s take a look, Mike, at the old Harry and Louise ad that your group put out 15 years ago.  You‘re going to give me the latest movie reviews here of this. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  This is covered under our old plan. 

UNIDENTIFIED MALE:  Yes, that was a good one, wasn‘t it? 

UNIDENTIFIED MALE:  Things are changing and not all for the better.  The government may force us to pick from a few health care plans designed by government bureaucrats. 

UNIDENTIFIED FEMALE:  Having choices we don‘t like is no choice at all. 

UNIDENTIFIED MALE:  They choose. 

UNIDENTIFIED FEMALE:  We lose. 

(END VIDEO CLIP)

MATTHEWS:  Your thoughts? 

TUFFIN:  The sequel to that movie is health insurance plans at the table with the administration, with Congress, with small business, with labor, trying to craft a solution.  That‘s the sequel to that movie.  That ad raised a lot of legitimate concerns that insurance companies had, that doctors had, that hospitals had, that patients had about a bill that was crafted in secret, 1,300 pages. 

What we saw yesterday was a president saying let‘s get everyone in this process.  Let‘s agree on some broad principles and hash it out and find common ground. 

MATTHEWS:  Who are the key people that are going to decide this?  The US Chamber, the other—who are the insurance company bosses? 

TUFFIN:  There‘s no bosses, but our group is actively involved.  We represent companies—

MATTHEWS:  Pharmaceuticals, doctors, hospitals, all the other providers.  So everybody is going to get around the table and come up with something.  Is that the idea here? 

ARENSMEYER:  It needs to turn into a design discussion at some point.  Everyone has a point view.  The last thing we want to do is have everyone‘s second choice be to do nothing.  Just about every plan out there is better than doing nothing at this point.  The system is totally broken.  And the only way to fix it is to get everybody at the table.  We really welcome the fact the insurance industry is at the table.  But it‘s going to be everybody—

MATTHEWS:  Here‘s Ted Kennedy yesterday.  Let‘s hear him on this issue.  It‘s his big issue. 

(BEGIN VIDEO CLIP)

SEN. TED KENNEDY (D), MASSACHUSETTS:  Now is the time for action.  I think most of us who have been in this room before have seen other times when the House and the Senate have made efforts.  But they haven‘t been the kind of serious effort that I think that we‘re seeing right now. 

I‘m looking forward to being a foot soldier in this undertaking.  And this time we will not fail.  Thank you very much. 

(END VIDEO CLIP)

ARENSMEYER:  Absolutely. 

MATTHEWS:  He‘s right.  We‘re going to get it, Mike, right? 

TUFFIN:  Absolutely. 

MATTHEWS:  We‘re going to get it this time? 

TUFFIN:  We‘re going to get it.

MATTHEWS:  We can get it even at a time of economic peril right now? 

It‘s a good time to do it?

TUFFIN:  Especially at a time of—

MATTHEWS:  Because?

ARENSMEYER:  Because if we‘re going to recover from this economy and we‘re going to get the economy going and the budgets problems going solved, we cannot do it without—

MATTHEWS:  So Rush Limbaugh is wrong.  He was trashing it today. 

Anyway, you agree, got to do it now? 

TUFFIN:  I agree, now.

MATTHEWS:  Thank you, Mike.  Thank you, John.  It‘s good to have the team together this time.  You‘re on the right side. 

Up next, will it take long—the first call from a Republican for the resignation of Republican Party Chairman Michael Steele.  They got their knives out for this guy.  We‘ll talk about that in a minute on the politics fix when we come back.  Michael Steele has enemies, not just Rush Limbaugh. 

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with the politics fix.  We have the “Rolling Stones” Matt Taibbi.  He‘s also the author of “The Great Derangement.”  He‘s joining right now.  There he is.  And Margaret Carlson of “Bloomberg.”

It‘s interesting that the knives are out, lady and gentleman.  Matt, you first, the knives are out in the Republican party.  That‘s not a good sign.  It looks like there‘s already a woman, here she is, one of the first national leaders of the Republican party—her name is Ada Fisher.  She‘s from North Carolina.  She‘s one of the top national committee members. 

Her e-mail apparently sends the word out that she wants this guy, quote “I don‘t want to hear anymore language trying to be cool about the bling in the stimulus package, or appealing to D.L. Hughley and blacks in a way that isn‘t going to win us any votes.  It makes us frankly appear to many blacks as quite foolish.”

And here she is, this woman, Ada Fisher.  She‘s a national committee member of the Republican party calling for the head of Michael Steele.  Here she is with Rachel Maddow last night. 

(BEGIN VIDEO CLIP)

DR. ADA FISHER, REPUBLICAN NATIONAL COMMITTEE MEMBER:  We have an 11th commandment.  And that commandment says we should not speak ill of other Republicans.  Mr. Steele has a right to say what he wants, as does Rush Limbaugh.  My concern is we need to focus on our mission and our principles.  We need to talk about the fact that this economy is failing, and we need to promote what is the Republican response. 

We need to talk about the fact that we have health care coming forward from the White House, and the Republicans need to say this is what our response is.  Those are the challenges that we face.  And the Democrats are doing a good job of getting us off task and off mission. 

(END VIDEO CLIP)

MATTHEWS:  Well, you know, I‘ve watched the Republican party in 1964 come back.  They went to the right.  In 1980, after losing in ‘76, they went to the right.  Sometimes it works.  Sometimes it doesn‘t.  But their pattern when they lose with a pragmatic candidate like McCain or Nixon, is to go to the right.  I hear Rush Limbaugh leading them that way.  What do you think, Matt, is that where they‘re headed? 

MATT TAIBBI, “THE ROLLING STONE”:  The Democrats certainly hope so.  Michael Steele has done the Democrats an enormous favor by kow-towing to Rush Limbaugh.  The Democrats would like nothing better than to see Rush Limbaugh be the public face of the Republican party. 

I mean, people like him are largely responsible for the fact that the Republicans lost the last election.  For the first time ever, the Republicans lost among married female voters in the last election.  Rush Limbaughs has high negatives among women.

MATTHEWS:  Why don‘t people like Rush Limbaugh.

TAIBBI:  rMD+IN_rMDNM_Because he‘s abrasive.  He‘s divisive.  He‘s a fat, pill popping idiot.  I mean, you know, he‘s completely, you know, abrasive to the centrist people in this country.  And the Democrats would love to make him the public face of the Republican party.  He would automatically win them hundreds of thousands of votes in every election. 

MATTHEWS:  I‘m glad I asked.  Ha.  Fat, pill popping—what was the final adjective on him? 

TAIBBI:  I don‘t know, buffoon, loser, take your pick. 

MATTHEWS:  Any I think you chose there.  Margaret, do you want to add to this line of thinking here?  I‘m asking you, why don‘t people like him in the polling? 

MARGARET CARLSON, “BLOOMBERG NEWS”:  You know, I don‘t think he‘s as unlikable as he was just described by Matt.  To those who like him, they love him, unlike any of the other talk show hosts.  He‘s beloved.  And he‘s more—actually more entertaining and intellectual than the other talk show hosts.  He has a conservative philosophy.  He‘s not dumb. 

However, he‘s got an ardent following that can‘t reach out to get to the people Matt‘s talking about, that the Republicans are going to have to expand to if they want to win. 

The problem with Michael Steele is he‘s been out front more than he‘s been in the back room trying to get the party organized for 2010.  You‘re supposed to have a public presence.  But you‘re also supposed to do the nuts and bolts, as Howard Dean learned, which Howard Dean did, by the way. 

MATTHEWS:  What does this say about the party?  Matt, I think it says this: there‘s a struggle over ideology as well.  It‘s not just personalities and communications ability.  Rush is a great communicator.  He knows how to stir people up.  He‘s a tumbler.  I know how he does it.  I don‘t quite know how he does it, but he‘s damn good at it. 

But he says go to the right.  Keep it simple.  No taxes, no government, no nothing.  Basically, very hard right, almost libertarian.  That‘s his pitch.  OK?  Don‘t knock the rich, don‘t tax them, leave them alone; they‘re the gods of our capitalistic system.  It‘s all simple. 

But that‘s moving to the right.  Is that the smart move for the Republicans in this century?   

TAIBBI:  No, obviously not.  They‘re going to lose all those votes in the middle.  The Republicans really need a charismatic person who can stand up to people like Rush Limbaugh.  But Michael Steele did the absolutely worst thing.  He took a shot at Rush Limbaugh, and then, you know, a week later comes crawling on his hands and knees, kow-towing and begging for an apology. 

He actually made Rush Limbaugh much bigger, a much bigger figure in the party than before. 

MATTHEWS:  I think—I think the people in the White House are helping him too.  We‘ll be right back with Matt Taibbi and Margaret Carlson.  Matt, you agree with me, which makes me happy.  You‘re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

CARLSON:  And you knew. 

MATTHEWS:  We‘re back with Matt Taibbi and Margaret Carlson to talk about the big development this weekend.  That is the word is out that Monday, Matt, President Barack Obama is going to get rid of that ban on federal support for stem cell research.  He‘s going to allow the creation of new embryonic stem cells for research purposes.  This is a major issue in the health field. 

TAIBBI:  I guess so.  I mean, it‘s about time.  I can‘t believe it‘s even taken this long.  I mean, it tells you everything you need to know about America that people are organizing to fight life-saving medical research in the middle of an urgent financial emergency.  This should have been done a long time ago. 

MATTHEWS:  Well, you‘re unclouded by political conflict.  Aren‘t you?  Everything is simple to you.  I struggle with some of these issues.  You just do it.  Matt, you‘re amazing.  You go to bed easily at night, don‘t you?  Margaret, do you have an complex in—any conflicts on this?  Is it easy for you? 

CARLSON:  Nice, clean thinking. 

MATTHEWS:  We‘re talking about human embryos. 

CARLSON:  It‘s clear enough that senator—no matter who was elect president, the Bush ban was going to go away.  Senator John McCain was going to get rid of the Bush ban as well.  The Bush ban I was totally against.  You should be able to take the embryonic stem cells that are—I mean the embryonic --  

MATTHEWS:  Embryos.

CARLSON:  Embryos that are going to be discarded. 

MATTHEWS:  Because they‘re in fertility clinics, because they‘re created.  

CARLSON:  They‘re there.  Bush said, no, you couldn‘t do that.  That made no sense.  If he was going to be ethically consistent, he would have said no more fertilization clinics. 

MATTHEWS:  No more in vitro.  

CARLSON:  He wasn‘t going to go up against that.  But then to just let them sit there frozen, losing eight years?  You and I know people who could benefit from that. 

MATTHEWS:  I could. 

CARLSON:  Soon we could.  So it was going to happen.  It was a Bush trying to appeal to the very conservative part of his party. 

MATTHEWS:  In your sense, Matt or Margaret, that we‘re going to see a fight on this come Monday.  Will there be a legislative effort to try to stop this?  Will the right accept this as a loss?  Matt? 

TAIBBI:  I think there might be some kind of nominal opposition.  But nobody‘s going to kick up a major fire storm over this.  Not with the things going on in Washington.  It would be crazy and it would be a guaranteed political loser for them to do that. 

MATTHEWS:  I‘m with Margaret.  I think the ethical issues have got to be observed.  But I think the threshold question is, do you have in vitro?  Once you have in vitro, and you have the questions of these stock piles of fertilized eggs, what are you going to do?  I think it is—by the way,the time we stop worrying about this—I disagree with Matt, the time we stop taking this stuff very seriously, ethnically, it‘s the end of our country‘s culture.  I think we have to argue about it. 

CARLSON:  We want to think about it. 

MATTHEWS:  We have to take it very carefully.  You don‘t want to be in the business of creating—would you be for all the way here, Matt, in creating fertilized eggs for science? 

TAIBBI:  That‘s not what we‘re doing here. 

MATTHEWS:  Would you do that?  Would you do that?  Would you do that? 

TAIBBI:  No.  I don‘t think so.  I think that‘s absurd.  This is not

what we‘re talking about with this.  We‘re talking about using already

existing cell lines for life-saving medical research.  There‘s absolutely -

it was a purely political decision on Bush‘s part. 

MATTHEWS:  Thank you.  Thank you, Matt.  Thank you, Margaret.  Join us again Monday night at 5:00 and 7:00 Eastern for more HARDBALL.  Right now, it‘s time for “1600 PENNSYLVANIA AVENUE” with David Shuster.

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