updated 3/30/2009 10:29:35 AM ET 2009-03-30T14:29:35

Guest: Robert Shogan, Michelle Bernard, Matt Taibbi, Jon Corzine, Tom Andrews, Rep. Loretta Sanchez, Julia Boorstin, Chris Matthews, Chuck Todd

CHRIS MATTHEWS, HOST:  President Obama goes to war.

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  Leading off tonight, Obama‘s war. 

Why did President Obama make such a huge commitment today to Afghanistan?  Why is he sending in 21,000 more troops?  Will this lead to further escalation on the other side as the people of Afghanistan and Pakistan join with Taliban to resist foreign occupation?  Are we getting out of Afghanistan or getting in deeper?

Here‘s the president making his case.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  I want the American people to understand that we have a clear and focused goal—to disrupt, dismantle and defeat al Qaeda in Pakistan and Afghanistan and to prevent their return to either country in the future.

(END VIDEO CLIP)

MATTHEWS:  Well, to some of us, it sounds a lot like John F. Kennedy taking the country deeper into South Vietnam.  The question we have to ask at this end is, What lies at the other end of this war?  Will the increase in American troops to 60,000 make it easier for our enemies to recruit fighters against the U.S., easier to set up roadblock attacks, suicide bombings?  Will the attacks on the tribal territories in Pakistan ignite the fury of those people against their government and against us?  Are we looking at another Vietnam?  That‘s our big issue tonight.

Plus: Afghanistan is only the latest crisis facing President Obama, of course.  We‘ve got the bank failures, the mortgage crisis, the collapsing housing market.  It‘s possible that no new president since Roosevelt has confronted so much trouble so soon.  So how‘s he doing?  Is the president of perpetual motion succeeding?  We‘ll talk about that tonight.

And even with the increasing importance of the Internet, there‘s nothing so powerful in driving politics than the medium I‘m on right now, television.  Tonight, we‘re going to take a look at this medium and how powerfully it‘s performed in certain moments in modern American political history when television and politics collided.

Also, look which member of the U.S. Congress sees herself as—and these are her words—“a foreign correspondent reporting from behind enemy lines.”  OK, it‘s Michele Bachmann.  We‘ve heard this kind of talk from her before.  It‘s caused a stir before.  Let‘s check in again with the Mata Hari of Minnesota.  That‘s in tonight‘s “Politics Fix.”

And could we see a basketball “shirts versus skins” one-on-one between President Obama and his attorney general?  That‘s in the HARDBALL “Sideshow” tonight.

We begin with President Obama‘s new strategy, as he puts it forth today, to defeat al Qaeda and the Taliban in both Afghanistan and Pakistan.  U.S. Congresswoman Loretta Sanchez joins us.  She‘s a Democrat from California.  She sits on the Armed Services Committee.  And Tom Andrews is a former Democratic congressman from Maine and now the national director of Win Without War.

Congresswoman, thank you very much for joining us.  Are you with the president on this when he talks about bringing in 4,000 new advisers into Afghanistan, in addition to the 17,000 new combat troops, bringing our complement up to 60,000?  Are you with him on this?

REP. LORETTA SANCHEZ (D-CA), ARMED SERVICES COMMITTEE:  Well, first of all, hi.  How are you, Chris?

MATTHEWS:  I‘m great.

SANCHEZ:  And secondly—secondly, remember that this is a NATO-led force out there in Afghanistan.  So we actually only have about 32,000 troops there right now.  We‘re going to increase that by 21,000.  I‘ve been there recently, into Afghanistan and also Pakistan.  I‘ve been talking to our generals.  They want to see this increase.  But at the same time, they also believe that we need to strengthen the institutions, build the institutions within Afghanistan, and get the economy rolling there also.  That‘s the only way it‘s going to work.

MATTHEWS:  Are you for this policy of escalation?

SANCHEZ:  Well, I am for the policy of putting in these new troops.  Now, remember the 4,000 that President Obama has just announced are really to train and to train up the army and the police for the Afghanistan government.  So what we‘re trying to do is to train them up so that they can provide security.  Security, after all, is the number one thing that a government can provide its people.

MATTHEWS:  Well, Congressman—former congressman Andrews, it does scare me.  I am afraid.  I see this as a Democratic president, like John F.  Kennedy did, coming in after a Republican president—in his case Eisenhower.  Eisenhower said, Go fight for Laos.  He said, No, I‘m going to take a middle position, I‘m just going to fight for South Vietnam.  This president said, I‘m not going to make Iraq into a big deal, but I‘m going to fight in Afghanistan.

It just seems like history repeating itself, and now this new Democratic president, fresh as a daisy right now, will end up a couple years from now fighting in quicksand.

TOM ANDREWS (D-ME), FORMER U.S. CONGRESSMAN, WIN WITHOUT WAR:  That‘s right, Chris.  I agree with you.

MATTHEWS:  Is that how you see it?

ANDREWS:  It is.  I mean, I had this gnawing feeling in my stomach when I was watching that news conference today.  You know, I thought about the best and the brightest that got us into the quagmire in Vietnam, and I said, Look, he‘s right...

MATTHEWS:  Who‘s Bruce Lydel (ph)?

ANDREWS:  Well, I‘ll tell you...

MATTHEWS:  Some guy he came up with.  He said, This guy gave me all the ideas for this, a person we never heard of.  It did sound like best and brightest.  Some Brookings guy.

ANDREWS:  Well, you know, and a comprehensive approach, fine, you know, diplomacy, development.  All those things are good.  But it‘s this escalation of military forces.  And the fact of the matter is, when you listen to the experts, they‘ll tell you—the Carnegie Endowment, for example, put out a report a few weeks ago, said the single most important factor behind the resurgence of the Taliban is the presence of foreign forces on the ground.  And the head of the United Nations Security Council al Qaeda monitoring team says that al Qaeda is trying to induce, provoke foreign countries like the United States to increase the force level...

MATTHEWS:  Because?

ANDREWS:  ... on the ground because that is how they both fuse themselves together and provide fuel to build their strength.  And by the way, as far as this being NATO—this is an American war.  Let‘s make no mistake about it.  The Canadians are getting out.  The Dutch are getting out.  The only country in NATO that is adding more troops are the Brits.  This is our responsibility, and I‘m afraid if this becomes Obama‘s war and it goes into this quagmire...

MATTHEWS:  Let‘s ask the congressman.  Congresswoman, are you concerned—“The New York Times” reported today—without going into the long statement of what they reported today, their main point was—well, I‘ll read the whole point because it is important.

Today “The New York Times” reports, quote, “After agreeing to burying their differences and unite forces, Taliban leaders based in Pakistan have closed ranks with their Afghan comrades to ready a new offensive in Afghanistan as the United States prepares to send 17,000 more troops there this year.  In interviews, several Taliban fighters based on the border said preparations for the anticipated influx of American troops there were already being made.  A number of new younger commanders in the Taliban have been preparing to step up a campaign of roadside bombings and suicide attacks to greet the Americans.”

This is what happened in Vietnam, Congresswoman.  We said we‘re going to put more troops in.  That encouraged the local people to get angrier and angrier at the newcomers, the foreign invaders, and just like they kicked out the Brits and kicked out the Soviets, they get agitated now to kick us out.  What do you think?

SANCHEZ:  Well, first of all, remember this is NATO-led.  And I would say to my former colleague there that this is truly NATO-led.  And the Germans are stepping up to the plate.  The French are considering stepping up to the plate, the Poles are.  So you know, it‘s not everybody‘s getting out.  Actually, everybody understands how important Afghanistan, and yes, Pakistan are to the stability of our world.

And the types of troops that we‘re putting in are to help those who are already there.  So I think it‘s a completely different situation, not anything close to what was happening in Vietnam.

And then let me say that we have a different strategy in Afghanistan. 

This is to work with the locals.  And actually more and more, we see it.  I‘ve just been there recently.  We see more and more the people actually want us there.  They want us to succeed because we are turning over and we are building these institutions for a more regional type of government, rather than a national type of government there.  I think it‘s going to go a long way in helping us to gain—to gain a foothold for the Afghanis themselves in their own country.

MATTHEWS:  We just got a report, Congresswoman, a that senior U.S.  intelligence official predicted today that violence in Afghanistan will rise this year, no matter what President Obama‘s new strategy may be able to achieve.  According to this official, this U.S. intelligence official speaking off the record, the strategy, if it‘s successful, the Taliban will turn up the level of violence to counter any progress, and if the strategy fails, the Taliban will also increase the violence.  So either way, we‘re going to get faced with it.

Let‘s take a look at the president making his case today.

(BEGIN VIDEO CLIP)

OBAMA:  And after years of mixed results, we will not and cannot provide a blank check.  Pakistan must demonstrate its commitment to rooting out al Qaeda and the violent extremists within its borders.  And we will insist that action be taken, one way or another, when we have intelligence about high-level terrorist targets.

(END VIDEO CLIP)

MATTHEWS:  Mr. Andrews, let me ask you about the Karzai government.  When he first came in, he looked pretty good.  Now we get reports that his brother‘s one of the biggest drug dealers in the country, that his government‘s corrupt, that it only rules, basically, in the capital city of Kabul.  It doesn‘t rule throughout the countryside.  What do you make of it?

ANDREWS:  It sounds a lot like the South Vietnamese government to me once again, Chris.

MATTHEWS:  Back in the ‘60s.

ANDREWS:  Back in the ‘60s.  I mean, we were propping up a government that didn‘t have the support of the people.  They were seen as a puppet of our—of U.S. imperialism, as they put it.  And it was used as a leverage point against them and against our troops.

I mean, the fact of the matter is, is that the presence of U.S. forces in Vietnam and here in Afghanistan is going to undermine our cause and strengthen our enemies.  The president said something very important last week on “60 Minutes.”  He said, There has to be an exit strategy to Afghanistan.  I didn‘t hear an exit strategy today.  And if we‘re going to be able to build the wedges that he‘s talking about with respect to the Taliban and bring in a regional approach, they all have to know our presence, military presence in Afghanistan, is limited.

MATTHEWS:  Do you think, Congresswoman, that we‘re in Afghanistan in perpetuity?  In other words, basically, we‘re there like we were in Germany?  We‘re just there.  We‘re not going to get out in the foreseeable future.  Is that the way you see the speech today by the president?

SANCHEZ:  I would hope not.  I mean, I don‘t think that the American people really want to see their troops in perpetuity anywhere anymore.

And I would just say that we‘re not—we are not propping up a government.  In fact, one of the reasons that we are bringing in some of these troops is to stabilize the country so that people do not have a fear when they go to vote.  We have an election coming up.  They‘re trying to set a date, somewhere between May and August.  We are not propping up Karzai.  We have not, you know, endorsed him.

And in fact, you know, one of the questions I had when I went there was, What is the new leadership coming up?  What do we see in other areas?  Who‘s going to try to get this presidency?  Remember that Karzai was duly elected by the people there.  And while I do believe that many of us are disappointed with the corruption in the national type (ph) of government, again, that‘s one of the reasons why our strategy is to make it a different type of government there and to rely more on what were the really good leaders that we‘ve seen in some of the provinces and some of the valleys and to return more to that type of a government and a looser type of national government going on there.

MATTHEWS:  Let me ask you about the problem.  And the reason we‘re there, obviously, Congressman, is because we were attacked on 9/11.  We were attacked by al Qaeda, which was based over there.  They trained people over there.  In going in over there, the American people were totally united.  We thought we could wipe out any al Qaeda base.  We could catch bin Laden, finish up the job and eventually come home.

Here we are, well, eight years later, and we‘re still in Afghanistan.  We haven‘t found bin Laden.  We haven‘t been able to get Mullah Omar.  We haven‘t been able to track down their headquarters, it escaped from Kandahar, escaped from Tora Bora, actually, ultimately, into perhaps Pakistan.

You were just over there.  What‘s the sense of how successful our mission is right now?  Are we ever going to be able to catch bin Laden?

SANCHEZ:  Well, I would just say that having been with my Marines and my Army soldiers, they are—I‘ve never seen the morale so high.  And believe me, I‘ve been traveling to Afghanistan and Iraq for these past seven or eight years.  I have never seen a group of our soldiers and our Marines so positive about the work that they are doing in Afghanistan.

And most of it stems from the fact that they have built the relationships that they have needed to built with some of the local leaders.  And it goes back to that strategy of take care of business on a very grass roots level.

As to getting bin Laden, I mean, I think part of the problem, quite frankly, has been Pakistan.  And now we see us losing, in a sense, Pakistan really devolving into something we don‘t want to see, another reason why we have to stabilize Afghanistan.

And the reason for being there now almost eight years—well, the reason is that I believe President Bush took his eye off the ball of where we should have been.  And you can‘t do an Iraq and an Afghanistan and be successful at those two at the same time.  It‘s just not possible.

MATTHEWS:  OK, thank you.  Thank you very much, U.S. Congresswoman Loretta Sanchez, making the case for the new Obama policy of building up our forces and trying to win that war in Afghanistan and defeat the Taliban and ultimately crush al Qaeda, the people that killed us on 9/11.

Coming up: President Obama has taken some hits over the past couple of weeks, but you‘d never know it looking at the polls.  This president is doing well with the American people.  We‘re going to look at how the president is holding up and why, as he‘s basically out there campaigning for his budget and his policy initiatives.  This president has been very aggressive and very visible.  We‘re going to bring in Chuck Todd, who‘s covering him as our chief correspondent.

You‘re watching HARDBALL, here on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Is President Obama‘s budget barnstorming working?  Meanwhile, can he get the country‘s banks to start lending again?  In a moment, we‘re going to talk to new Jersey Governor Jon Corzine, who‘s up for reelection this year, about the president‘s plans and what means to politicians.

First let‘s check in with Chuck Todd, NBC‘s chief White House correspondent and political director.  In this country, if you talk to governors, mayors and everybody, they‘re all broke.

CHUCK TODD, NBC WHITE HOUSE CORRESPONDENT, POLITICAL DIRECTOR:  Right.

MATTHEWS:  They hate the job they have.  They love the office, but they hate the job, which is to spend things that don‘t get them any credit...

TODD:  Right.

MATTHEWS:  ... paying off retirement health costs, you know, building

fixing old bridges.  And then they get this big chunk of money from the federal government, right?  Aren‘t they happy right now?

TODD:  Well, they‘re happier.

MATTHEWS:  Yes.

TODD:  But there‘s still—a lot of these states are still going to be in debt.  There‘s still not enough money.  The stimulus money is helping.  It‘s helping, you know, cut some of the Medicaid problem that they have, to fix that gap, roads and bridges.  But there‘s still—a lot of them are still hurting and they‘re hurting badly because as—you know, when the economy contracts, tax revenues contract.

MATTHEWS:  I just watched a comparison on another program of President Barack Obama speaking to the press corps this week.  You were up in the front row asking questions.  And then I looked at a picture of—clips of George W. Bush doing the same thing.

TODD:  Right.

MATTHEWS:  There‘s a real difference.  Not that one guy‘s smarter than the other, but one man‘s—this current president‘s ability to deal with complicated issues with great ease...

TODD:  Right.

MATTHEWS:  ... and almost like a college—an Oxford don, if you will.

TODD:  Well, that‘s what he is.

(CROSSTALK)

MATTHEWS:  It‘s that why he‘s doing so well in the polls, his ability to communicate in conflict?  In other words, people are hitting him hard and he‘s answering questions like Cool Hand Luke.  Is that helping him?

TODD:  Well, it‘s not just doing it on Tuesday, it‘s the constant—it‘s the fact that he‘s there and he‘s hitting all mediums.

MATTHEWS:  He‘s always available.

TODD:  Think about the last eight days and what it was designed to do.  It hit—it hit everybody.  So the primetime press conference hits the maximum number of people that you can get in one group setting (INAUDIBLE)

MATTHEWS:  Right.

TODD:  That‘s 30 -- let‘s say 40 million people.  But then he grabbed the “60 Minutes” crowd.  But not any...

MATTHEWS:  Did they sit through that whole hour?

TODD:  But not any...

MATTHEWS:  I‘m going to ask you a tough question.

TODD:  Yes.

MATTHEWS:  (INAUDIBLE) sat through it?

TODD:  Yes.  Well, you know, but who was watching?  The people watching “March Madness,” independent white men.  Then you go to the ESPN bracket thing.  He never mentioned the budget, but again, he was touching an audience that doesn‘t normally tune in to him.  Then he does Jay Leno, again, a different audience.  So it‘s as if...

MATTHEWS:  So you‘re saying—as an expert on this—you‘re telling me, my colleague...

TODD:  Yes...

(CROSSTALK)

MATTHEWS:  ... that his numbers are high because he‘s out working.

TODD:  Correct.  And you‘ve got to show it...

MATTHEWS:  OK.  How does he...

(CROSSTALK)

MATTHEWS:  ... into the questions we have to talk about now?  He has to convince this country that to get not just through the hell we‘re going through right now in terms of unemployment, but to build a competitive American economy that can compete with the Chinese and the Indians and the Russians and everybody else in the world, we have to deal with health care, we got to deal with energy, we got to deal with education.  Can he convince on those three fronts?

TODD:  Well...

MATTHEWS:  With his popularity.

TODD:  But those issues are popular.  You know, the fact is, right now, the public wants something done about health care.  They want something done about education.  Energy, I think‘s a little bit less.  I think the energy thing...

MATTHEWS:  It‘s climate change.  It‘s windmills.

TODD:  It is, but it doesn‘t...

MATTHEWS:  Because the gas prices are down.

TODD:  That‘s right.

MATTHEWS:  Because the gas prices went down.

TODD:  Health care touches everybody.

MATTHEWS:  OK.

TODD:  Education touches everybody.  I think he‘s going to have more success there.  I bet you he punts cap and trade, that whole climate fight.

MATTHEWS:  OK.  I think he‘s got a fight on health care until the last dog dies.

TODD:  But he‘s got to, because...

(CROSSTALK)

TODD:  ... you and I brought—talked about this the other day.  How many Democratic presidents have promised health care and failed? 

MATTHEWS:  Since Harry. 

TODD:  Exactly.  And he‘s got to actually—if he doesn‘t produce—the credibility of the Democratic Party‘s on the line...

(CROSSTALK)

MATTHEWS:  I don‘t want to be sitting around here in December, watching Congress adjourn for the year, and having to report, once again, the biggest priority of this president has been put off. 

Let‘s go ahead and bring in an expert here who actually gets elected to do this. 

Jon Corzine is the governor of New Jersey.  He‘s up for reelection. 

Governor Corzine, you‘re a man of great financial wizardry. 

GOV. JON CORZINE (D), NEW JERSEY:  Oh, sure.

MATTHEWS:  You come from Wall Street.  Oh, come on.  You come from Goldman Sachs.  I‘m not holding you accountable.

But you‘re one of the few people in public life that knows what the hell these terms mean.  How‘s he doing, the new president, right now? 

CORZINE:  I think he‘s doing extraordinarily well. 

The fact is, is that, in a situation like in New Jersey and in the other 50 states, he‘s helped us keep our education budgets on balance.  He‘s made sure that we can serve our people in our health care system.  And he‘s giving us ability to put people back to work in building roads and reconstructing our mass transit systems. 

You know, he has, I think, stabilized at least the—the immediate worries about the financial system.  It‘s not a perfect fit yet.  But, based on what I see going on in financial markets over the last three or four weeks, he‘s actually done a great job of getting what is a terrible mess that he inherited into a more stable period. 

And I think people feel that.  They feel good about his leadership. 

MATTHEWS:  You know, people, I think—I agree with you.  I watch the polls, too, and I get the reaction.  People do like the action.  They like the fact that he‘s out there pushing for things like health care, like education, getting the government in the stimulus mode. 

CORZINE:  Right. 

MATTHEWS:  But they don‘t like the tax end.  You have had your own experience with property tax deductions. 

Do you think he‘s actually going to get away with taking away itemization, so you can‘t write off charitable contributions 100 percent? 

CORZINE:  I think that—I think that...

MATTHEWS:  Do you think he will actually win on that?

CORZINE:  ... particular issue is going to be a—a thorn that he‘s going to have to deal with. 

But, as all of us who have to deal with a comprehensive set of problems and come up with comprehensive proposals, you know, there‘s some give and take that allows for you to get to the heart of what you‘re trying to do. 

If he gets to reform of health care, and he takes a step back on deductibility of—of expenditures on charitable giving, I think that will be a pretty good trade. 

MATTHEWS:  Yes. 

CORZINE:  He‘s going to have to figure out how it gets financed.  I think that there will be some increases in revenues, but the fact is, if he gets that health care problem solved, as you said, Harry Truman‘s the first guy that started talking about that in a serious way, and we‘re still having that debate. 

MATTHEWS:  Chuck Todd, the White House correspondent...

CORZINE:  That will be a heck of a legacy. 

MATTHEWS:  I agree completely. 

Well, Chuck Todd, the White House correspondent, our colleague, has a question for you, Governor, if you don‘t mind. 

CORZINE:  No.

TODD:  Governor, today, we had a bunch of the bankers at the White House.  And I have had this—I have had a couple of folks ask me this question to ask and pass on. 

You‘re a finance—you‘re a finance guy.  Explain how banks are able to borrow all this money, based—from the Fed at some point at a very low interest rate, zero, even less than 1 percent, and, yet, people feel like they‘re not getting that discount passed on to them, for instance, on their credit card interest rates. 

Explain that disconnect of why a Citigroup will borrow...

MATTHEWS:  Yes. 

TODD:  ... at such a low amount of money, under 1 percent, and, yet, the interest rates on a lot of people‘s credit cards have actually gone up. 

CORZINE:  Well, that‘s where we need a lot of pressure from the Federal Reserve and the regulators and the bully pulpit of the president, saying that we need to see some translation of the interest rates that consumers are paying, not just on credit cards, but on a whole host of auto loans and...

(CROSSTALK)

TODD:  But what is going through the Citigroup guy or the...

CORZINE:  Right. 

TODD:  ... or the—or Bank of America?  Why are they—you know, what—what is the disconnect?  I mean, is it...

CORZINE:  What they‘re doing, they‘re keeping their spreads where they are, so that they can recapitalize the bank. 

One good thing about what is happening, when that happens, is that they‘re earning money.  You heard Citibank three weeks ago say they look like they were going to earn money this quarter.  Well, the reason is that they‘re still charging those high interest rates, against these low cost of funds that they have. 

MATTHEWS:  Yes. 

CORZINE:  And that‘s allowing them to generate income.  That‘s good. 

On the other hand, we have got to get some of those rates down.  We want the consumer to get active again. 

MATTHEWS:  Yes. 

CORZINE:  And, until...

MATTHEWS:  Yes. 

CORZINE:  ... there is pressure to see that happen—and it is happening in mortgage rates.  Mortgage rates have broken through 5 percent, and they are probably as low as they have been in the last 30 years. 

So, I think we need a little more in broader categories than student loans and auto loans. 

MATTHEWS:  OK. 

Yes, well, I‘m hoping—by the way, last thought.  And if you give me a quick answer, I would appreciate it, Governor.  Are we going to be through this hell in the next year two, or is this a serial problem?  Is this a long-term problem we‘re going to face in this country, a decline in the American dream? 

CORZINE:  Chris, in political terms, it won‘t be done by this November, but I think we will be seeing the straws—more than straws in the—in the wind by the end of this year. 

And I would think, when we‘re talking this time next year, people are going to be a lot more optimistic. 

(CROSSTALK)

CORZINE:  And I think you will see results. 

MATTHEWS:  Well, you know your stuff.  Thank you, Governor.  Thank you very much.

We have got to talk about gambling some night on this show, because I think every governor I know is going the Jersey way.  Everybody thinks that the way you get money is through the idiot tax.  Get the people that are least responsible throwing their money away, and get them to give most of their money away to the slots and everything else.

Anyway, just a thought.  I don‘t know want to sound too much like a puritan.

(LAUGHTER)

MATTHEWS:  Anyway, no problem.  I also—I am bored out of my mind even watching those people with the Dixie cups.  I don‘t know how they do it with the golf gloves and the Dixie cups.

TODD:  He‘s got to run for reelection in New Jersey.

MATTHEWS:  I know.

(CROSSTALK)

CORZINE:  I‘m going to let you keep on talking, Chris.  This is not one I‘m touching. 

(CROSSTALK)

MATTHEWS:  These—these people with the Dixie cups filled with quarters and the golf gloves, they do it all—I was in New Jersey one time giving a speech at 9:00 in the morning.  They were there 9:00 Sunday morning.

Anyway, thank you, Governor.  It‘s not your fault.  You didn‘t invent it.  It‘s Trump‘s fault. 

Anyway, up next: March madness. 

(LAUGHTER)

MATTHEWS:  President Obama throws down a challenge to his attorney general over who‘s got the better basketball game.  We‘re lightening things up here on Friday afternoon.  This president is a jock.

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Well, this is real “Sideshow” stuff. 

So, back to HARDBALL and back to the “Sideshow.”

First up, U.S. Congresswoman Michele Bachmann is so concerned at all this talk about having the dollar replaced as the worldwide reserve currency that she has in fact introduced a bill in Congress that would prevent this country, the United States of America, from replacing the dollar we love as our currency here at home. 

It‘s not clear why she did it, since nobody on the planet, least of all here in America, is talking about switching to some kind of new, multinational currency here. 

Anyway, this is what her spokesman told “The Washington Post”—quote

“This legislation would ensure that the U.S. dollar remains the currency of the United States.”

Again, it‘s not clear who or what the congresswoman is afraid of here. 

That said, it‘s not hard to discern what‘s generally worrying the congresswoman from Minnesota these days.  Remember a while ago on this program, when she said this?

(BEGIN VIDEO CLIP, OCTOBER 17, 2008)

REP. MICHELE BACHMANN ®, MINNESOTA:  I wish the American media would take a great look at the views of the people in Congress and find out, are they pro-America or anti-America?  I think people would be—would love to see an expose like that. 

(END VIDEO CLIP)

MATTHEWS:  Well, the call for that expose caused quite a stir. 

Here, this week, she was on Sean Hannity‘s radio show, working the same vein.  Here she is. 

(BEGIN AUDIO CLIP, “THE SEAN HANNITY RADIO SHOW”)

BACHMANN:  We are headed down the lanes of economic Marxism as—more quickly, Sean, than anyone could have possibly imagined.  It‘s difficult for us to even keep up with it from day to day. 

Right now, I‘m a member of Congress.  I—and I believe that my job here is to be a foreign correspondent, reporting from enemy lines. 

(END AUDIO CLIP)

MATTHEWS:  That‘s how she describes her work here in Washington, as a foreign correspondent reporting from behind—I love this word—enemy lines. 

In other words, the people who disagree with her are the enemy.  She is the Mata Hari of Minnesota.  We will get more of that picture as we continue to follow her career. 

Next up:  This morning, President Obama worked a curveball into his—

Eric Holder‘s installation ceremony.  Here he is hinting that, through one of his biggest attributes, the attorney general may be a bit too willing to criticize the boss. 

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  In fact, several months ago, Eric even had the audacity to comment to a reporter on my basketball skills. 

(LAUGHTER)

OBAMA:  He said—and I quote...

(LAUGHTER)

OBAMA:  This is what he said.  He said, “I‘m not sure he‘s ready for my New York game.” 

(LAUGHTER)

OBAMA:  We will see about that, Mr. Attorney General. 

(LAUGHTER)

(CHEERING AND APPLAUSE) 

(END VIDEO CLIP)

MATTHEWS:  Well, that‘s a game to watch. 

Time now for the “Big Number.” 

It‘s been a rough year, and political parties are now feeling the pinch.  Today‘s “Washington Post” reports that, in January and February of 2005, the same sort of post-presidential election period that we‘re in now, the national party committees, Democrat and Republican, collected about $50 million from individual donors. 

Amid this recession, how much have the parties pulled in during the last two months of this year—the first two months of this year?  Forty percent less, $30 million so far, compared $50 million four years ago. 

I guess you could call it political and financial triage.  With the election behind us, most people see more pressing things to pay for than political campaigns.  National parties are bringing in 40 percent less from individual donors than they were this time four years ago.  That‘s tonight‘s “Big Number.” 

Catch “The Chris Matthews Show, by the way, this weekend.  I have got a quartet of top reporters looking at this big Obama fight this spring for his whole shebang, health care, education, climate change.  It‘s going to be quite a show. 

Up next:  How did television come to dominate the way we follow politics in country?  From the McCarthy period, the Joe McCarthy period, and Watergate, to Ronald Reagan, to 9/11, and Barack Obama, the power of this medium—coming up in a minute or two. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

JULIA BOORSTIN, CNBC CORRESPONDENT:  I‘m Julia Boorstin with your CNBC “Market Wrap.”

Stocks falling, but still finishing higher for the third straight week.  The Dow Jones industrials lost 148 points.  The S&P 500 shed almost 17 points, and the Nasdaq dropped 41. 

Consumer spending rose in February for the second straight month.  However, personal income slipped because of massive layoffs.  The number of states with double-digit unemployment rates rose in February from four to seven.  The state with the highest unemployment rate is Michigan, at 12 percent.

Oil prices tumbled today.  Crude fell $1.96, closing at $52.38 a barrel.  And “The Wall Street Journal” reports, General Motors is likely to miss a government-set restructuring deadline next Tuesday in order to receiver more taxpayer help.  That‘s because it has yet to gain concessions from its main union and bondholders.  However, “The Journal” says GM is likely to win a 30-day extension. 

That‘s it from CNBC, first in business worldwide—now back to

HARDBALL. 

MATTHEWS:  Welcome back to HARDBALL. 

Today, we take it for granted that any compelling testimony or game-changing speech made here in Washington will be available to us, if not instantly, then soon, because, over the past 30-plus years, some Washington dramas have drawn us in with an almost soap opera-type quality, compelling millions of people to tune in daily. 

Take this iconic moment from John Dean‘s testimony in the heat of Watergate. 

(BEGIN VIDEO CLIP, JUNE 25, 1973)

JOHN DEAN, FORMER WHITE HOUSE COUNSEL:  I began by telling the president that there was a cancer growing on the presidency, and, if the cancer was not removed, the president himself would be killed by it. 

I also told him that it was important that this cancer be removed immediately, because it was growing more deadly every day. 

(END VIDEO CLIP)

MATTHEWS:  Well, that cooked Nixon‘s goose. 

Here‘s Oliver—Oliver North, looking clean-cut in full dress uniform, who testified in the Iran-Contra scandal.  And he got five times the viewership of the top-rated soap opera, “General Hospital,” that day.  This is how many people were watching this guy put on this show, thanks to the genius lawyering of Brendan Sullivan. 

Let‘s watch this one. 

(BEGIN VIDEO CLIP, JULY 7, 1987)

UNIDENTIFIED MALE:  Do you solemnly swear that in the testimony you‘re about to give will be the truth, the whole truth, and nothing but the truth, so help you God? 

OLIVER NORTH, U.S. MARINE CORPS:  I do. 

UNIDENTIFIED MALE:  Please be seated. 

(END VIDEO CLIP)

MATTHEWS:  And then, after Anita Hill surfaced in the Clarence Thomas confirmation, the country was riveted by the Senate Judiciary Committee hearing.  Forty million people watched this. 

(BEGIN VIDEO CLIP, OCTOBER 11, 1991)

CLARENCE THOMAS, SUPREME COURT JUSTICE NOMINEE:  This is a circus. 

It‘s a national disgrace. 

And, from my standpoint, as a black American, as far as I‘m concerned, it is a high-tech lynching for uppity blacks who in any way deign to think for themselves, to do for themselves, to have different ideas.  And it is a message that, unless you kowtow to an old order, this is what will happen to you. 

(END VIDEO CLIP)

MATTHEWS:  What a chilling moment. 

Now listen to this one.  It all began the first time we saw television do it.  You‘re looking at it right now, the Army-McCarthy hearings.  Twenty million people watched that back in the early ‘50s.  They could watch politics in real time for the first time, the Army-McCarthy hearings that brought down Joe McCarthy in ‘54.

The senator from Wisconsin was being totally irresponsible, calling people communists and communist sympathizers, using guilt by association and every trick in the book to make people look like traitors. 

Here he is.  Watch this scene that killed this guy. 

(BEGIN VIDEO CLIP, JUNE 9, 1954)

JOSEPH WELCH, SPECIAL COUNSEL FOR THE ARMY:  Have you no sense of decency, sir?  At long last, have you left no sense of decency? 

(END VIDEO CLIP)

MATTHEWS:  Well, here we are with Robert Shogan, who wrote the great book about this.  Robert Shogan‘s book, he‘s with us right now, “No Sense of Decency.”  Sir, you covered this story.  Television, ABC News covered that and created itself that day, right? 

ROBERT SHOGAN, AUTHOR, “NO SENSE OF DECENCY”:  That‘s right, because the other two networks were too busy showing—too profitable showing soap operas.  That‘s one of the reason ABC did it, because they didn‘t have the soap operas.  But it did put them on the journalistic map, and made them close to equal with the other two. 

MATTHEWS:  David Corn, you‘ve covered a lot of these spectacles yourself in your young age.  The fact is, the McCarthy hearings, I used to come in the afternoon, and my mom never watched television—this is from an Irish Catholic point of view, a somewhat different tradition.  And those hearings were on every day.  I knew who she was rooting for, Joe McCarthy.

But a lot of Americans saw what they saw, what Bob was writing about, Robert Shogan, and they said, that was the first time they saw something on television that really turned them off and said, this guy is a demagogue.  He‘s a sweaty, dangerous, perhaps drunken, bad guy. 

CORN:  Television is a medium of impressions.  You probably know that better than anyone else.  It‘s not so much always what‘s said but how it‘s said.  And Joe McCarthy had really captured the American imagination for years, both good and bad, with his reckless allegations.  But he had his fans and he had his detractors.  A lot of it was based on what they saw on news reels or what they read.  People actually read about things back then. 

But that one moment, that one exchange, very personal, seemed to cut through and show the exact type of person he was.  Perhaps like we saw with Kennedy and Nixon in the debates.  There are some defining moments where you have an image and you see what‘s there.  And that was one of the first times that I think it happened in a collective sense nationally.

MATTHEWS:  Let me read something from your book,the fear that permeated the McCarthy area that you wrote about.  Here‘s an excerpt from your book, “No Sense of Decency:” “The politics of fear and paranoia, while they have ebbed and flowed, never really went away.  They persist to this day in the midst of the so called war on terror.  McCarthy was able to convince everybody that anybody who opposed the administration at that time, the government, was dangerous.” 

SHOGAN:  That‘s right.  Not just opposed the administration, but opposed him.  And that was paranoia.  Let‘s be clear about this, there‘s—paranoia in itself is not necessarily bad.  It can energize things.  You need some selective paranoia.  For instance, this week, though people didn‘t hardly notice, it was the 20th anniversary of the Exxon Valdez oil spill.  Where is the paranoia about the poisoning of our water and our air?  People have forgotten that or it‘s been obscured, just as in McCarthy‘s day, the FBI investigated communists and ignored organized crime. 

MATTHEWS:  He said there was no such thing as the Mafia. 

SHOGAN:  Said there was no such thing, which saved them the trouble from looking into it.  Just as today, instead of looking into the destruction of the environment, or the destruction of our financial structure, people are absorbed with terrorism.  And there‘s a real threat from terrorism, but it needs to be evaluated in a calm and democratic way. 

MATTHEWS:  But it was very hard after watching the World Trade Towers and the people jumping off the roof at 100 floors, the hellish situation they were in—it‘s unimaginable.  I think about it on occasion, we all do.  Once you saw that picture, any president could have come forward and said, we‘ve got to get the enemy.  And he would have or she would have in her power the power to say, that‘s the enemy. 

And this president we just had, George W. Bush, was able to say, because of that anger, Iraq, sick them.  And we all acted like we were trained to do that. 

CORN:  I read Robert‘s book, and it‘s a good read.  But the peril that was obvious was that there were a lot of reporters back then covering McCarthy and taking his allegations more or less as handouts and just transmitting them without doing any of the evaluative work that you do to judge what he was saying.  Where‘s the evidence? 

And it did remind me of those months—you were there, you remember, when reporters were taking what the Bush administration had to say about the threat from Iraq and just putting it out there, and not going to alternative sources, and not really vetting it, because there was that atmosphere of fear and insecurity. 

SHOGAN:  Let‘s not blame the media alone, although I‘m—it‘s the politicians who manipulate the media.  David mentioned the very powerful image of the tower falling, which the networks showed time and time again.  But here‘s an image that the administration wouldn‘t allow people to see; those were the coffins of the men coming back from Iraq. 

MATTHEWS:  That‘s right.  You know your TV.  Thank you, Robert Shogan, a neighbor of mine.  “No Sense of Decency,” get it at the book store this week.  It will tell you about a whole era that proceeded this one.  It will tell you where we came from, a great book. 

And who of my generation and so many others can forget the great Irving R. Levine, that bow tied NBC correspondent, who spent years on this network, on NBC, generally, giving us those classy, snappy economic reports.  For 45 years, this fine gentleman told us what was happening with verve, style, and his classy signature, “this is Irving R. Levine.” 

He died yesterday after a second career at Lynn University at age 86. 

What a nice guy. 

(COMMERCIAL BREAK)

MATTHEWS:  We are back.  Time for the politics fix with Michelle Bernard, president of Independent Women‘s Voice and an MSNBC political analyst, and the “Rolling Stone‘s” Matt Taibbi, who‘s latest story, “The Truth About the Bail Out” is the current issue of that fabulous magazine, “The Rolling Stone.” 

I can‘t resist this, when I heard about this.  Here‘s U.S.  Congresswoman Michelle Bachmann, another Michelle, back in October on HARDBALL, and this week‘s on Sean Hannity‘s radio show.  Here she is sort of continuing in this vain, very fearful vein.  She believes she‘s surrounded by dangerous people in Washington. 

(BEGIN VIDEO CLIP)

REP. MICHELLE BACHMANN ®, MINNESOTA:  I wish the American media would take a great look at the views of the people in Congress and find out, are they pro-America or anti-America?  I think people would love to see an expose like that. 

We are headed down the lanes of economic Marxism.  It‘s more quickly, Sean, than anyone could have possibly imagined.  It‘s difficult for us to keep up with it day-to-day.  I‘m a member of Congress.  I believe my job here is to be a foreign correspondent reporting from enemy lines. 

(END VIDEO CLIP)

MATTHEWS:  “A foreign correspondent behind enemy lines,” that‘s how she sees herself, Matt Taibbi, this person representing, I guess, an interesting district in Minnesota, with an interesting concern, which is fear of the enemy that surrounds us. 

MATT TAIBBI, “THE ROLLING STONE”:  Sorry, what? 

MATTHEWS:  Did you miss all that, Matt?  Should I repeat it? 

TAIBBI:  Repeat the question, I‘m sorry, I didn‘t hear you. 

MATTHEWS:  What do you make of the concern she is surrounded by the enemy, that, in fact, she believes, again, there ought to be an investigation of the people who serve with us for their anti-American views, to the point that she feels like a Madahari (ph).  She feels like a foreign correspondent amidst enemy camp? 

TAIBBI:  It‘s funny this morning, outside of Penn Station, I saw a guy huffing glue out of a paper bag.  And he was making more sense than Michelle Bachmann.  I can‘t believe you need to pass a written test to drive a car in this country.  I bet this woman can‘t even write her name in the ground with a stick.  It‘s unbelievable to me that this person is in the Congress. 

MATTHEWS:  You know set up Michelle Bernard to look reasonable here.  What do you make of—she also said that she‘s introducing legislation, in a press release today—yesterday, actually.  She‘s going to introduce legislation, I think she already has, to make sure that nobody tries to replace the dollar in America.  We‘re going to stick to our currency, because she heard somewhere out there—this is like Rosanna Danna (ph), on “Saturday Night Live” years ago.  She‘s heard there might be a different standard of currency on the world, a basis for a reserve currency in the world, like Sterling, the Dollar, the Euro, something else. 

In hearing that conversation, she‘s become concerned that somebody is going to come sweeping into our local candy stores and whatever, our supermarkets, and replace all the dollars with some strange looking new currency.  She‘s got this in her head.  She‘s outlawing that. 

MICHELLE BERNARD, MSNBC POLITICAL ANALYST:  She seems to have been completely confused by, you know, China‘s Request on monetary policy and what the reserve dollar was going to be, what the basis of the reserve would be.  I don‘t know where she‘s going with this.  I don‘t understand where the confusion has come in.  But there‘s a lot of confusion.  She‘s introduced a resolution to make sure that we always use the U.S. dollar in this country, even though President Obama, Ben Bernanke, and Secretary Geithner have all said they are opposed to having a one-world currency. 

MATTHEWS:  Not only that, there was never, Matt, any discussion of changing American currency or giving it up the way the British people—rather, the French gave up their Frank for the Euro.  Nobody ever talked about giving up the dollar.  We love our dollars.  We love our currency.  She wants to pass a law in Congress to get it signed by the president, who she sees as a tyrant, by the way.  I don‘t know why she thinks he‘ll ever sign this.  To protect our currency.  Last thought on Michelle Obama—I‘m sorry, Michelle Bachmann. 

BERNARD:  We‘ve got to get you—

(CROSS TALK)

MATTHEWS:  This is a busy Michelle—we‘ll be right back.  I think your thoughts have been completed already.  We‘ll be right back to talk about this big war we‘re fighting in Afghanistan.  This is serious business.  We‘re at war.  We have a new president who wants to escalate.  We‘ll be right back on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with Michelle Obama and Matt Taibbi.  You know, the president made a dramatic statement today.  It concerns because it sounds so much like, in his new commitment troops, what he calls advisers, trainers going into Afghanistan, it looks like a long-term commitment.  It sounds a lot like Vietnam.  I know he inherited this, but he‘s putting a lot of chips on the table here.  What do you make of it, Matt?

TAIBBI:  I‘m not really clear where we‘re going to get the money to fight these wars when we‘ve just spent about ten trillion dollars in loans and guarantees in the last eight months alone just bailing out the economy.  I think it‘s a very strange time for them to be making this kind of decision.

MATTHEWS:  Michelle Bernard?

BERNARD:  I think he‘s going to get a lot of trouble from people on the left.  You‘re seeing articles already coming out on “The Nation,” Mr.  President, please don‘t do this.  People are scared that Afghanistan is going to become Barack Obama‘s war.  During the primary season, he was open.  He was honest.  He was up front about it.  He took the national conversation on a pivot from Iraq to Afghanistan.  It should be no surprise to anyone who voted for him that he was going to do this.  He made it very clear from day one on the campaign trail. 

It might be part of the reason why some people who care about military affairs elected him.

MATTHEWS:  The dangerous thing—maybe this is unavoidable.  Maybe it‘s a Hobbsian choice here, Matt.  When you see “Charlie Wilson‘s War,” that great movie about our aid to the Mujahedeen, you have a situation where you help the side you‘re on.  Then you end up being on the other side, occupiers.  But more dangerously, it seems like if we don‘t keep funding these people, giving them money, supporting their local economic development, eventually you leave and they turn against you.

Do we have to stay there in perpetuity?  That‘s my question. 

TAIBBI:  If you read a book like the “Great Game,” the history of Afghanistan is pretty consistent.  Every time a foreign power goes in there to, quote unquote, restore order, they end up leaving in some kind of bloody disaster.  I think we‘re either going to have to stay there forever and keep doling out money, or we‘re going to have to leave and create a problem.  I think it‘s probably easier to just cut our losses and get out.

MATTHEWS:  Let me challenge you on that.  If we cut our losses and split, and the president said today, the Taliban comes back and brings with it al Qaeda.  We‘ve got an enemy camp facing us again like we had seven our eight years ago.  What do you do?

BERNARD:  He also said it‘s creating problems not only in Afghanistan, but in Pakistan.  He‘s got to get Osama bin Laden. 

MATTHEWS:  Michelle Bernard, thank you.  Matt Taibbi, thank you both.  Have a nice weekend.  Join us again Monday night at 5:00 and 7:00 Eastern for more HARDBALL.  Right now, it‘s time for “1600 PENNSYLVANIA AVENUE.”

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

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