updated 4/17/2009 1:36:08 PM ET 2009-04-17T17:36:08

Guest: Robert Reich, Virg Bernero, Keith Ellison, Wayne Slater, Jonathan Alter, Michael Smerconish, Bill Press, Laura Flanders

(BEGIN VIDEOTAPE)

ED SCHULTZ, HOST:  I‘m Ed Schultz.  This is THE ED SHOW.

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SCHULTZ:  Good evening, Americans. 

Live from 30 Rock in New York City, it‘s THE ED SHOW on MSNBC.

Tonight, another bank makes big money. 

The president goes south of the border. 

Is there a deal for America workers? 

Texas Governor Rick Perry wants to party like it‘s 1861 and secede. 

The never-ending Minnesota Senate race.  They‘ve got a new poll and it‘s bad news for Norm Coleman. 

And we‘ve got new “Psycho Talk” from Congresswoman Michele Bachmann. 

All that, a great panel coming up.

But first, tonight‘s “OpEd.”

You know where I stand on this.  I‘ve got some issues with the middle class and the wage earners who I think are getting a raw deal in this economic recovery. 

Now, look, you know I‘m a fan of the president.  He says we‘re in this together.  I got all that.

But Mr. President, please listen tonight.  There is a double standard between what‘s going on, on Wall Street, and what‘s happening on Main Street, and it‘s all about the money. 

Look around the streets in your town, folks.  Even here in New York City—even the most prosperous cities in the world, which is New York City, they‘ve got shops, you know, signs are closing, and spaces for rent, casualties of a recession. 

Heck, you know, if ale mega story like City Circuit (sic) can get killed off, you think the mom-and-pop stands can stand a chance?  What small businesses need to survive with is credit.  It‘s all about cress.  We need loans to small businesses. 

I‘m going to pound on this.  You can count on coming here every night, and I‘m going to pound on this until it happens. 

The government recognized that the banks need money, so what did they do?  They gave them a nice deal.  They gave them $700 billion in taxpayer money.  The banks were to pass it on to Main Street. 

Folks, it has not happened.  It‘s kind of like when you‘re on an airplane and they do this emergency drill, and the oxygen masks fall down.  You put your mask on first and the others come up and help.  That‘s what the government did. 

This TARP money was supposed to be some oxygen, give them some breathing room for the banks so they could keep lending.  Numbers today show that‘s simply not happening. 

Lending from bailed-out banks to businesses is down 24 percent.  It‘s about the lending for student loans, OK?  That‘s off.

You know who the worst offender of this is of the banks when it comes to taxpayer money?  JPMorgan Chase.  They announced a $2 billion profit today. 

You know what bothers me about all of this?  The Treasury Department, their response is, well, basically we just had to give them the money. 

The other big economic news today is this—foreclosures in the country are up 24 percent.  More than 800,000 families have received a foreclosure notice in 2009. 

The Obama administration has given $75 billion to entice lenders to refinance mortgages.  This is about access and accountability, no doubt about it. 

Hey, now, I have no problem with doing what they‘re doing with the auto industry.  You know, they went out and said—just got rid of the CEO, they did a change, and they‘ve given Chrysler until the end of the month to do a deal with Fiat.  Chrysler basically is on the ropes. 

Fiat is going to get—here‘s what Fiat‘s doing.  They‘re saying, OK, Chrysler, make sure you get taxpayer dollars that come in from Washington and around the country, and then we‘re going to come in, we‘re going to put a gun to your head, and we‘re going to manage this, and we‘re going to go after your workers and we‘re going to depress wages. 

Folks, here‘s what‘s happening.  They‘re making money on Wall Street, which I‘m a fan of.  That has to be part of the recovery.  But what also has to be part of the recovery is that access to cheap money has got to come to small businesses, and the working folk have got to be a priority for this administration.  I have to say early on, I don‘t see that. 

If we allow the Fiats and Chryslers to get together and do a deal, and then they go back and they blame it on the unions, tell me, where is the deal for the worker?  Where is the deal for the middle class?  How are we going to get out of this recession if nobody in the middle classes is out there spending any money?  Don‘t we pay attention to any retail numbers that are out there? 

So, Mr. President, I want to make this appeal to you tonight.  I know you‘re in Mexico and you‘re doing what you‘ve got to do, but you‘ve got to get your people out there from the Small Business Administration, and you‘ve got to explain to us why we can‘t get $700 billion and compete against the banks. 

All this talk about, well, we can‘t nationalize the banks—the hell we can‘t.  All you have to do is do it.  That‘s all you‘ve got to do.

We‘ve got to set up this fund.  It‘s a bank called a small business fund.  And if you‘re a small business, you know what you can get?  Four percent. 

That would still be higher than what the banks are getting.  They banks are getting a heck of a lot cheaper than that. 

So I want to know, is anybody out there that can explain to me, who‘s got some experience that, hey, this is really a good deal and everything‘s going to work out?  Now, I‘m an Obama fan, but if we don‘t ask the critical questions, how are we going to get moving forward in this country? 

Joining me tonight is former Clinton Labor Secretary Robert Reich. 

Mr. Reich, great to have you with us tonight.

ROBERT REICH, FMR. LABOR SECRETARY:  Well, Ed, it‘s good to be here. 

How are you doing?

SCHULTZ:  I‘m doing great.

REICH:  I heard that editorial.  You‘re just as fiery as you ever were. 

SCHULTZ:  Well, am I right or wrong? 

REICH:  Well, I think there‘s a lot that you say that‘s absolutely right.  Look, these big bank bailouts aren‘t really helping Main Street, they‘re not helping students, they‘re not helping small businesses.  They‘re a continuation of what the Bush administration was doing. 

Now, again, I‘m an Obama fan, I was an adviser to him during the transition.  I think that most of the people working for him, they‘re trying to do the right job, but they have the idea that the only way to fix the economy is through the big banks, and I‘m not sure that‘s right.  I think you want to get the money down to Main Street. 

SCHULTZ:  Is there any chance that we could set up a government bank that would be just for small businesses in America?  Say any company under 100 employees can go get cheap money?  Why not?  And nobody is talking about this but me. 

Why can‘t we have something like that? 

REICH:  Well, Ed, I think we should do that and I think we can do that.  And I think the Federal Reserve Board—you know, you haven‘t even mentioned the Federal Reserve Board. 

It‘s not just the TARP money.  It‘s not just all of the $700 billion.  It‘s also the Fed is practically printing money, and a lot of the money it‘s printing is going directly or indirectly to the very big money center banks, but it‘s not getting down to Main Street and it is not going to small businesses. 

So I‘m with you.  In fact, Ed, why don‘t we set up a bank together? 

SCHULTZ:  Well, I‘m all about it. 

REICH:  And we won‘t even take multibillion-dollar paychecks. 

SCHULTZ:  Here‘s the key.  The country has to have the mindset that making money in the front office right now should not be the top priority. 

What has to be the top priority is the middle class gets a chance to recover, the middle class has a chance to move forward.  We‘re throwing billions of dollars at the banks, they get to do whatever they want to do.  But when it comes to small businesses, when it comes to cheap money, apparently there‘s not a mechanism in place where we can get that done. 

Now, you being the former labor secretary, where do we go from here? 

REICH:  Well, look, the basic principle here—and you articulated it well, I‘m going to try to do it even in a shorter time frame, and that is the only way we can get the economy going is if average working people have money in their pockets.  And if they lose their jobs and don‘t have money in their pockets, and if they don‘t have small business loans or whatever, we can‘t get this economy going. 

So it‘s not a matter—I mean, every time a big banker like Ken Lewis

I have nothing against Mr. Lewis, he‘s head of Bank of America.  His job is going to be decided on in two weeks by bank shareholders at Bank of America, but Bank of America is partly owned by you and me and other taxpayers.  I mean, we gave it $45 billion.  I think we should have some say in this. 

SCHULTZ:  Well, notice how these financial institutions are saying, Mr. Reich, that, hey, we‘re going to pay this money back by the end of the year. 

You know why they‘re going to pay the money back, folks?  Because they don‘t want a limit on how much money they can make. 

This talk about executive pay and limiting somebody in the front office of these banks to only $500,000 a year, heck, half these guys, that‘s their expenses for the year, $500,000.  I mean, that‘s chump change to them. 

They want this government money out of their office, they want to get stabilized, and then they want to go back to making millions of dollars.  That‘s what they want to do.

And look, I‘m a private business guy, I‘m all for it.  But I just see a double standard here, and I‘m going to pound this every night.  And you know who they‘re going to take?  They‘re taking it out of the hides of the workers, is what they‘re doing, because this Fiat and Chrysler deal is going to stink when it‘s all done because they‘re going to go after the unions, they‘re going to go after the wages.

And you know that, Robert. 

REICH:  Well, Ed, you know, here‘s what I don‘t understand.  When the government goes and bails out General Motors and Chrysler, it says to the UAW, you‘ve got to give back money. 

Now, I know—we know you‘ve had contracts, you‘ve had contractual agreements.  It was hammered out in the collective bargaining negotiations.  But you‘ve got to give back money if the government is going to give any bailout. 

Well, I understand that principle, but when it came to the big banks, we said no, you don‘t have to give back money.  Those bonuses?  No, those are contractual agreements.  You don‘t have to give those back.  Well, it seems to me that we should ask the same thing of the big bankers that we‘re asking of UAW workers. 

SCHULTZ:  I‘m all about it. 

Mr. Reich, thanks for joining us tonight.  Appreciate your time here on THE ED SHOW.

REICH:  Thanks, Ed.  You take care. 

SCHULTZ:  You bet.

Now let me bring in Virg Bernero.  He‘s the mayor of Lansing, Michigan. 

Virg, you‘re outspoken on this.  Tell me where the deal is for the worker if Fiat comes in, does a deal with Chrysler, and then tells the workers, you‘re making too much money.

MAYOR VIRG BERNERO, LANSING, MICHIGAN:  Ed, I‘ve been over here like a bobblehead shaking my head.  I agree with everything you said. 

Look, I wish the best.  We‘re working with the Obama administration.  We hope for the best.  But the little guy, the working man, has been thrown under the bus time and time again. 

It was billions for the banks, no questions asked.  And then squeeze the little guy, squeeze the unions. 

And I‘m sorry, I take it personality when you squeeze the unions, because my dad retired from the UAW, retired from General Motors.  He worked hard every day in his life and didn‘t ask for anything for nothing, and now he‘s got a pension.  Eighty—four years old.

And are we supposed to apologize for that?  Am I supposed to apologize because we had dental benefits and health benefits as a family? 

General Motors, the big three, Chrysler, they did a social good by providing dental and health care.  Look at the dentists they employed in health care.  Look at what they contributed to the economy and the good health.

And now they‘re kicked in the shins and thrown under the bus while the banksters in Washington and Wall Street continue to get theirs.  No questions asked.

There is the double standard, there‘s no question, and it‘s always coming out of the little guy.  You know, I don‘t mind.  I don‘t mind giving my part, and I know working people don‘t mind sacrificing for the good of the country, but that sacrifice has got to be shared and it‘s got to be proportional, for god sake. 

SCHULTZ:  Yes.  Virg, here‘s the one thing that I think—this could

be setting up to be the biggest blunder by the Obama administration.  And

if we don‘t point this out as Americans—I want the president to succeed

hey, I‘m all about it—but you can‘t leave the workers behind. 

Now, he‘s got allies.  He‘s got the House and the Senate.  If it doesn‘t happen right now in this environment, somebody tell me, when is this going happen? 

BERNERO:  I really appreciate your ringing the bell, Ed, because there will not be a long-term recovery unless you address the middle class.  The middle classes is under siege.  You know this and we see it all over this country. 

Here we are on Main Street.  You‘re exactly right about the banks.  As it happens, I just met with one of our local bankers today.  They‘re being left behind. 

The big banks are taken care of, and the community banks that have actually helped develop our communities, they‘re getting increased requirements from FDIC.  No help from Treasury, and they‘re getting beaten up by the regulators.  And they‘re not even the ones that caused the problem. 

The problem banks came from Wall Street.  It was the banksters there.

So, no question, we need real reform, real help that works on Main Street, with what we‘re dealing with here.  We can‘t keep taking from the little guy. 

In order to grow out of this recession, we have got to contribute to our GDP.  We‘ve got to put the “P” back in GDP, gross domestic product.  We‘ve got to bring manufacturing back to this country.  That means good jobs. 

So we can‘t keep squeezing those people on the bottom.  And in the middle—the unions helped create the middle class.  The big three helped create the middle class in this country. 

SCHULTZ:  You got it.

BERNERO:  We need to be looking at bringing manufacturing—we need to support our industry like those other countries support their industries.  We used to say what‘s good for America is good for GM.  I can assure you, in Korea, they still say what‘s good for Hyundai is good for Korea. 

We have to realize that we need the big three, the auto manufacturing and other manufacturers to succeed.  We need to support them.

You know, these other outfits, they have health care provided by the government. 

SCHULTZ:  Mayor, good to...

BERNERO:  A lot of this stuff is covered by the government. 

SCHULTZ:  You‘re on a roll.  I love it.

BERNERO:  So I appreciate it.

SCHULTZ:  You know, I love your passion.

BERNERO:  So keep up the fight.  Working people...

SCHULTZ:  We‘re going to do it.

Mayor Virg Bernero from Lansing, Michigan. 

BERNERO:  Thank you so much.  Working people of America, appreciate you. 

SCHULTZ:  Well, look, I‘m just telling it like it is.  And in the sum total of this, if I may—thank you, Virg.  I appreciate your time tonight.

Folks, in the sum total of this, this is what‘s happening.  Your tax dollars are going to the auto manufacturers, OK?  And they‘ve got to come up with this plan.  If they don‘t come up with this plan—part of the plan is, hey, Chrysler, go do a deal with Fiat.  Fiat is saying, OK, but we‘re running the show and, by the way, we‘re going to own most of the company down the road. 

What?  How does this help American workers?  This is wrong. 

Mr. Geithner, will you please come on THE ED SHOW on MSNBC and address this? 

Next up, the NSA is illegally reading Americans‘ e-mails and listening to phone calls.  It even tried to tap a congressman‘s phone. 

So what‘s Congress going to do about that? 

Gosh, we‘ve got issues tonight on THE ED SHOW.  Stay with us. 

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.

The National Security Agency‘s wiretapping program is under fire again.  Government officials say the NSA has intercepted private e-mails and phone calls in a way that goes beyond the legal limits set by the Congress last year. 

“The New York Times” reports NSA tried to wiretap a member of the Congress without a warrant.  The newspaper quotes an unnamed intelligence officer with direct knowledge of the matter as saying that the NSA believed the lawmaker was in contact with an extremist who had possible terrorist ties. 

The identity of the lawmaker could not be determined, but was part of a congressional delegation that went to the Middle East in 2005 and 2006 during the Bush years.  The official says the plan was ultimately blocked because of concerns from some intelligence officials about using the NSA spying on a member of Congress without court oversight.  “Oversight” is the big word. 

Senate Intelligence Committee Chairman Dianne Feinstein says that she will investigate the wiretap investigations. 

Joining me now is Democratic Congressman Keith Ellison of Minnesota. 

Keith, good to have you with us tonight.  How else do I read this?

REP. KEITH ELLISON (D), MINNESOTA:  Good to see you, Ed.

SCHULTZ:  You bet, buddy.

How else do I read this other than this is the Patriot Act on steroids and nobody is paying attention to what the heck is going on? 

ELLISON:  Well, you know, Ed, there have been three big votes.  There was one in August 2007 which I voted against, which was overreaching and too broad.  And then there was another vote, the Restore Act, which I think did comport with the Constitution, which I voted for.  And then there was a final vote which I voted against because they granted telecom immunity and restricted judicial oversight. 

So, again, you know, this, I hope, will bring to light and make real for members of Congress why we have to have issues of civil rights in conjunction with concerns about security as we go forward on the FISA. 

SCHULTZ:  All right.  Now, the argument is, hey, we didn‘t get hit. 

The program must have worked.  Nobody is hurt.

How do you feel about that? 

ELLISON:  Well, I feel that it‘s completely disingenuous to phrase it that way.  I mean, the fact of the matter is, is that we‘re violating people‘s rights. 

We have evidence of it.  We have proof of it. 

The fact is, privacy is an essential and fundamental American value.  People ought to be able to be unbothered by the government if they‘re minding their own business and if there‘s no evidence that they‘re doing anything that violates the law.  So here we have an admission that there‘s been over-collection of private information by individual citizens, and this is Exhibit A as to why the bill—next bill we do—must be one that respects the Constitution of the United States. 

SCHULTZ:  All right.

Congressman Ellison, tell me this isn‘t happening during the Obama administration, that this was some time ago.  Is this going on right now?  Isn‘t that what we should know? 

ELLISON:  Well, I think it‘s important to know that it was during the Obama administration that we learned these things.  I think during the Obama administration, heightened scrutiny on the program is what we‘re seeing.  And I think that in large measure, I‘d like to attribute some of the credit for bringing this problem to light to the Obama administration. 

SCHULTZ:  Sure, you have.  Yes, no doubt about it. 

OK.  Now, the FISA court, now there‘s a FISA judge inside the Justice Department, and there‘s a window of which they have to be notified and get approval after they wiretap somebody. 

Isn‘t that the procedure?  What happened to that? 

ELLISON:  You know what?  I don‘t know what happened to that.  We‘ve got to look into that, Ed.  That‘s the problem. 

I mean, you know, I think this is something that the Congress has a duty, an obligation to dig into and figure out.  I mean, things didn‘t work right. 

Even the bill that passed, which I thought was overbroad and I didn‘t vote for, this behavior violated even that.  So, I mean, you know we‘ve got a problem. 

SCHULTZ:  Yes. 

Congressman Ellison, thanks for joining us tonight. 

ELLISON:  You bet.

SCHULTZ:  In fact, I think you might want to stick around.  We‘ve got some more material coming up here. 

ELLISON:  All right, Ed.

SCHULTZ:  Coming up next on THE ED SHOW, “Psycho Talk.”  She‘s back. 

In less than a week, Michele Bachmann has returned to the “Psycho Talk.”

Folks, you‘re not going to believe this one.  It‘s a dandy.  And it‘s coming up right after this. 

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.

Have you heard some of the crazy things that are being said by conservatives? 

It‘s time for “Psycho Talk.”

We have our first repeat visitor to the “Psycho Talk” zone—

Congresswoman Michele Bachmann.

Last week, the Minnesota congresswoman did a little noticed interview with a San Francisco radio station.  Bachmann was asked about the incident back in 2006 involving six Muslim religious leaders who were taken off a US Airways flight in Minneapolis. 

At the time, “The New York Times” wrote that the Muslim leaders were detained after complaints of suspicious behavior.  The behavior included prayers at the gate and speaking in Arabic. 

First, let‘s listen to Bachmann‘s call when she was referring to them as “flying imams.” 

(BEGIN AUDIO CLIP)

REP. MICHELE BACHMANN ®, MINNESOTA:  We also were the site of the six flying imams.  The imams were actually attending Congressman Keith Ellison‘s victory celebration, when he won as a member of Congress.

(END AUDIO CLIP)

SCHULTZ:  OK.  Stop right there, Congresswoman.  That‘s a lie. 

Congressman Ellison, is this true? 

ELLISON:  This is not true.  I think it could even be called “Psycho Talk.” 

SCHULTZ:  Now we‘re making Congress.  We‘ve got the Congress behind us. 

They were actually in Minneapolis attending a conference of North American Imams Federation, a fact that‘s been widely reported.  Let‘s hear some more now. 

(BEGIN AUDIO CLIP)

BACHMANN:  They were shouting phrases, anti-Bush, anti-America, were making these statements.  And when they got aboard the airplane, they switched seats, they didn‘t go to their proper seats.  And they went in the pattern of the 9/11 terrorists. 

(END AUDIO CLIP)

SCHULTZ:  They did what? 

Despite Bachmann‘s claims, ThinkProgress.org points out there is no evidence at all about the religious leaders fitting the pattern of the 9/11 hijackers, which she just said.  Nor were there any reports that they were shouting anti-Bush phrases. 

For the record, after five hours of detention, federal agents released the group, finding them not to be a threat.  You heard it here first. 

Now, I wouldn‘t be surprised if Roger Ailes over at Fox is talking to Michele Bachmann about hosting her own show.  Oh, no!  My “Psycho Talk” is going to be taken over by a real psycho talker!

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  Texans have a saying: “if brains were leather, he couldn‘t saddle a flea.”  In my book, Texas Governor Rick Perry deserves that for this one.  Listen to the governor. 

(BEGIN VIDEO CLIP)

GOV. RICK PERRY ®, TEXAS:  Texas is a unique place.  When we came into the union in 1845, one of the issues was that we would be able to leave if we decided to do that.  My hope is that America and Washington, in particular, pays attention.  We‘ve got a great union.  There‘s absolutely no reason to dissolve it.  But if Washington continues to thumb their nose at the American people, you know, who knows what may come out of that? 

(END VIDEO CLIP)

SCHULTZ:  Is calling for secession just dumb, or is it dangerous? 

Joining us now is Wayne Slater, senior political writer for the “Dallas Morning News” and author of “Bush‘s Brain, How Karl Rove Made George W. Bush Presidential.” 

Mr. Slater, good to have you with us.  You still have a lot of material down there in Texas, don‘t you? 

WAYNE SLATER, “DALLAS MORNING NEWS”:  It just gets better and better down here. 

SCHULTZ:  Is this governor serious?  He sounds like it‘s a very threatening comment.  You know, if the government in Washington keeps doing what you‘re doing, you never know, we might get out of the union.  What‘s happening here? 

SLATER:  Look, this is really smart politics, sort of small ball, for the moment.  Rick Perry has a challenge next March against Senator Kay Bailey Hutchinson as governor.  And he‘s been losing support among some Republicans.  So what he‘s really doing is two things, situating himself here in Texas among the far right, and the real conservatives in the Republican party for that primary, so he can win reelection.

And then, interestingly, his folks see him as a national figure.  You talk about abortion, you talk about stem cells, you talk about Washington out of control.  And then you talk about states‘ rights and seceding from the union.  This is catnip for the Republican party conservative wing.  And they think this will play nationally. 

I have to question whether it will. 

SCHULTZ:  He only won, what, 37 percent of the vote.  So this is really, as you say, a political card he‘s playing.  Do you think it will work? 

SLATER:  It could.  It really depends on how big the turnout is in the Republican primary.  Ultimately, the Republican primary in a lot of states, and certainly in Texas, includes a lot of people who are really conservative, social conservatives, and others.  And he‘s banking on the idea that these social conservatives, sort of nativist conservatives, and the folks who are associated, frankly, with the fringe in Texas, will rally to his side and make up for it. 

That‘s the danger, really, in part of what he‘s doing.  When you appeal to the fringe, then you risk being defined by the fringe.  So the Kay Bailey Hutchinson side has to say, you know, I wonder if some of the soccer moms and the economic conservatives and some of the moderate forces of reason in Texas, when it comes time to vote, or maybe in the general election next November, say, this is too far right even for us. 

SCHULTZ:  Mr. Slater, you‘ve been covering Texas politics for a long time.  Kay Bailey Hutchinson, how bad do you think she wants to be governor.  You‘ve got to want to lead.  You‘ve got to want to get in there.  Does she still have the fire in the belly to do this for Texas? 

SLATER:  Every indication I get is that she does.  I‘ve talked to her a lot.  I talked to her people.  I‘ve talked to basically her people and Rick Perry‘s people virtually every day, even though we‘re some distance from next year‘s primary and general election.  She says she wants to run this race. 

She—I think this is a blood feud between herself and Rick Perry for a lot of reasons.  I think she is committed to running against him.  But I got to say, this latest manifestation of Rick Perry sort of culture warrior, which is designed to appeal to very conservative Republicans in the primary next year, this manifestation is something that‘s a shot across the bow to Republicans and moderates and independents in Texas that Perry thinks will pay off, and that Hutchinson believes will backfire. 

SCHULTZ:  Wow.  If it pays off, Katie bar the door.  I mean, this almost qualifies for psycho-talk, but that‘s another day.  Mr. Slater, good to have you with us today.  Thanks so much for your time.

For more on this, let‘s bring in our political panel, national syndicated talk show host Bill Press. 

BILL PRESS, RADIO TALK SHOW HOST:  Hey, Ed. 

SCHULTZ:  And also radio talk show host and MSNBC contributor Michael Smerconish, and Laura Flanders, host of “GritTV.org.”  Michael, we‘ll start with you tonight.  Gosh, Texas—we all should be having a lot of talk radio down in Texas, shouldn‘t we?  How do you play this story on the radio? 

MICHAEL SMERCONISH, RADIO TALK SHOW HOST:  Ed, what I see going on here, just as you‘re guest indicated, I‘m sure it plays tremendous with the base in Texas.  What I think it does is make him unelectable to a national audience.  From my standpoint, Rick Perry has been a guy with his eye on the national prize.  That may already have been unrealistic, but I think it presents—

It‘s a sign of a bigger problem for the GOP.  That is that these primaries continue to generate candidates who may get elected within the base, but they just can‘t be big-tent candidates.  That‘s a manifestation of what you‘re seeing in Texas today. 

SCHULTZ:  Bill, you know, the one thing you take a look at Texas, they‘re very proud people.  There‘s no question.  But they kind of have this, there‘s Texas and then there‘s the United States.  Now, if Rick Perry, if he‘s thinking about being president of the United States, do you think he‘s pretty much taken himself out with this rhetoric? 

PRESS:  No, absolutely.  But I‘ll tell you Ed, I take it a lot more seriously than politics.  I‘m not kidding.  I think Attorney General Eric Holder should cite this guy for treason.  Come on, he‘s not some rednecker living up in the hills somewhere.  This is the governor of Texas. 

We love political debate.  You and I, we specialize it in it, right? 

And the rest of the members of the panel.  But there are some limits.  You‘ve got some responsibility.  Words have consequences.  I think it‘s way over the line.  I think it‘s very dangerous.  And you know, some yahoos are going to believe this guy and believe that the state of Texas has the right to just zip out when they don‘t like what‘s happening in Washington. 

SCHULTZ:  Laura, your take on all this?

LAURA FLANDERS, GRITTV.ORG:  I want to know are there going to kids all over Texas saying, OK, the pledge of allegiance is off now?  I don‘t have to do it if the governor won‘t.  Your other guests are right on.  Why is he paying attention and misinterpreting, in fact, 1845 history.  It wasn‘t about the right to secede.  It was the right to split up.  I guess they‘ve already cracked up.  So what difference does it make? 

But he‘s in a state that has 100,000 newly unemployed folks.  Those Texans need a leader who will be bringing them together, not pointing the finger somewhere else, a guy who will take responsibility and not just—I guess 97 percent of the stimulus money. 

SCHULTZ:  Michael, that is the one thing.  We really don‘t know where disgruntled Americans will go, how far they will go.  Clearly, it seems like Rick Perry is appealing to these people.  Wouldn‘t there be a turn off by some centrist Republicans that—he only won about 37 percent the last time.  I don‘t see the up side in talking like this. 

SMERCONISH:  I agree with what you‘ve just said.  And I think that‘s what Kay Bailey Hutchinson is hoping for.  That‘s the big issue for the Republican party.  The same way you have that out-pouring yesterday among those folks who comprise the base.  The base can‘t get it done.  We just saw that last November.  It‘s got to be more big-tent oriented. 

So far, in the aftermath of that drubbing in November, the GOP hasn‘t shown any signs of wanting to be inclusionary. 

SCHULTZ:  Bill, what would be the strategy for Kay Bailey Hutchinson right now?  What do you think her best play would be? 

PRESS:  You know what I would say if I were Kay Bailey Hutchinson or if I were Barack Obama, OK, Mr. Governor, the next time you have a hurricane in Texas, you‘re on your own, pal.  Don‘t come to Washington looking for any FEMA help.  You figure it out, how you‘re going to fix it. 

SCHULTZ:  I would like to know what his plan for health care would be with no government funding.

FLANDERS:  Health care and getting troops on the border.  It‘s true, we can laugh about this stuff, but there is a serious tinge here.  Some of what I saw at that rally yesterday at the Alamo was not pretty.  It was ugly stuff.  I don‘t think we‘ve seen the end of it yet.  He‘s encouraging it. 

SCHULTZ:  Texans ought to actually be scared about this.  If they secede from the union, we have a history of invading oil-rich countries.  The other 49, we could be invading.  You never know what is going to happen on this deal, right. 

Panel, stay with us.  We are going to be coming back.  We have a lot more to talk about it. 

Up next on THE ED SHOW, an overwhelming number of Minnesota voters want Norm Coleman to get off the field.  Will he about gone before the ice gets off the lakes in Minnesota.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  In my playbook tonight, is the Minnesota Senate race and Norm Coleman, is this thing finally over?  It‘s time for Mr. Coleman to step aside.  Minnesota has gone long enough with one Senate in D.C.

Now, I love this comment Coleman made to the “St. Paul Pioneer Press.” 

Wednesday, he said, “we will never know who won.” 

OH, yes, we will, Norm.  And it‘s not you.  You see, you lost.  Seven judges in the state of Minnesota, three on Monday and four in January, have concluded that Al Franken is actually the winner.  He got the most votes.  He is the next senator from Minnesota.  They elected him. 

It‘s time for Norm to step aside, get off the field.  The clock has run out.  It‘s just not fair to the state of Minnesota to have this continue on.  And I really think it hurts the Republican party.  Now, a new poll shows that 63 percent of Minnesotans want Norm to concede, to step aside to Democrat, Al Franken, who won the race; 59 percent say they want Governor Pawlenty to sign the certificate declaring that Franken is the winner. 

Joining me now is “Newsweek” senior editor Jonathan Alter.  Great to have you with us. 

JONATHAN ALTER, “NEWSWEEK”:  Hey, Ed. 

SCHULTZ:  What‘s wrong with the governor?  He won‘t concede, either. 

ALTER:  He‘s in a tight spot, Governor Pawlenty.  If he drags this on much longer, he jeopardizes his own presidential hopes for 2012.  He‘s a pretty reasonable candidate for the Republican party.  They could do a lot worse than him. 

SCHULTZ:  There‘s no question about it.  He‘s very well-spoken.  He‘s up on the conservative issues.  So why would he sacrifice his future when the majority of Minnesotans wants this to end? 

ALTER:  Because he has to have backing at home.  If he alienates the Republican party, he‘s got a problem.  So he‘s between a rock and a hard place.  But I think the politics on this are moving pretty quickly and there are quite a number of Republicans in Minnesota saying behind the scenes that it‘s time for Norm Coleman to pack it in. 

SCHULTZ:  What‘s your prediction on Jon Cornyn of Texas, who has been a staunch supporter of Coleman, never throw in the towel, even talking about World War III.  Do you think they‘ll soften their position on this? 

ALTER:  I think Cornyn will defer to Coleman.  They have been colleagues in the Senate for a while now.  They‘re very friendly.  He wants to—look, it‘s hard to lose.  You‘ve got to—in some ways, you have some sympathy for the guy.  He‘s thinking, how did I get beaten by this comedian? 

So they want to ease him out.  It‘s not going to be easy. 

SCHULTZ:  So the next step is the Minnesota State Supreme Court.  Let‘s say Norm Coleman goes to the U.S. Supreme Court.  Do you think a Roberts-led court would have an appetite for getting involved in this? 

ALTER:  You know, I don‘t know for sure, but I would really doubt it.  I think they won‘t grant cert, as it‘s called.  I don‘t think they‘ll review the case.  But they could.  The thing that‘s so crazy is you hear people saying, we‘ll never know who won.  I don‘t remember them saying that in 2000 in Florida.  Somehow, the shoe is on the other foot now and they want due process until the cows come home. 

SCHULTZ:  What‘s Harry Reid‘s role in this?  Couldn‘t he step up and say, we‘re going to put him in the Senate next week?  It‘s over.

ALTER:  He‘s been saying since January that this thing should be wrapped up.  But I don‘t think they want they want to rub wounds raw. 

SCHULTZ:  Does he have to wait for the governor?

ALTER:  It‘s smart for him to wait.  He doesn‘t need Franken‘s vote tomorrow.  So it‘s smart for him not to ram this through right now.  Where this is going to be really important is in the fall when there are going to be a few issues, particularly on energy, where they‘re going to need those 60 votes. 

SCHULTZ:  Franken is a huge player when it comes to health care.  I mean, that‘s a big vote.  That‘s a real big vote. 

ALTER:  Not necessarily. 

SCHULTZ:  You don‘t think so? 

ALTER:  What they‘re going to do, Ed, next week, is they‘re going to come back, and the leadership on the Democratic side, both the House and Senate, they‘re going to attach something to this budget resolution which will allow them to get health care and education through with 51 votes.  It‘s an obscure procedure called reconciliation. 

SCHULTZ:  No more filibuster?  They changed that?

ALTER:  They will do that on those two issues, but not on energy.  On energy, they need those 60 votes. 

SCHULTZ:  Bush did that a few times, didn‘t he? 

ALTER:  Yes, he did, those tax cuts. 

SCHULTZ:  Jonathan, great to have you on tonight.  Thanks so much.   

A major announcement in professional football today, legendary football sports broadcaster and co-host of NBC‘s “Sunday Night Football” John Madden is retiring.  Actually, I thought this guy would never retire.  He‘s a great guy.  Madden won 16 Emmys.  Hold it right there.  This is a telestrator, I get to play with this tonight.  First time at NBC I get to do this here.  He won 16 of these Emmys.  He‘s an emotional guy, a huddle guy.  He‘s a great coach.  I know, I had a tryout with him. 

To his due, he‘s an outstanding sports analyst and personality.  In a statement today he says, it‘s been such a great ride.  The NFL has been his entire life the last 40 years.  It‘s been his passion, and it still is.

But you know what, I know this thing about John Madden: as a broadcaster, he never left the viewer behind.  Whether you knew football, whether you were a player, whether you were a coach, he had an uncanny ability to relate to everybody.  He coached the Oakland Raiders.  They won the Super Bowl.  He was one of the youngest coaches in the NFL when he got the job, won 103 games, lost 32 and seven ties.  By the way, they did beat the Vikings. 

In 2006, he was inducted into the NFL Pro Football Hall of Fame as a coach.  I can tell you, he was a great coach.  He was a players‘ coach.  I remember one time when we went to scrimmage the Dallas Cowboys and Tom Landry was the coach.  Tom was all dressed out, very neat and everything else.  Jon is kind of a loose guy, doesn‘t really care about how much he looks, until he‘s on TV. 

But Landry asked Madden, Jon, do you want to come up in the tower.  Madden, I‘ll never forget, I don‘t want to do that.  I‘m one of these guys, I want to get in the huddle.  I want to know what the players are saying. 

Then he moved on as a broadcaster.  I‘ll tell you what, he has been the gold standard for 30 years as a broadcaster, the gold standard.  I think this guy has been absolutely fantastic.  Who‘s going to replace him?

Who‘s going to replace him?  Chris Collinsworth?  He‘s a nice guy, but what about me?  Come on, man. 

We‘ll be right back after this. 

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  President Obama became the first U.S. president in 12 years to visit Mexico City.  Tops on the agenda today?  Guns.  Ten thousand Mexicans are dead in the last two years because of drug violence.  Ninety percent of those guns are coming from right here in the United States. 

Think drugs and guns in Mexico have nothing to do with you?  Think again.  There‘s a lot of drug-fueled gang violence in America.  Phoenix has had more than 1,000 Mexican gang related kidnappings in the last three years.  And battles for the turf are spilling into the streets. 

Joining me from Laredo, Texas, is NBC News correspondent Mark Potter, who talked to the president‘s new border czar in an exclusive interview.  Mark, what‘s going to change? 

MARK POTTER, NBC NEWS CORRESPONDENT:  Ed, what‘s going to change is what you are seeing here, more U.S. cooperation with the Mexican government.  This is the southbound lane at the U.S. border crossing in Laredo.  These cars are heading into Mexico.  They are being searched by U.S. agents before they get there.  They‘re looking for guns and money potentially headed for the Mexican drugs cartel. 

This is happening after Mexico asked for more US help.  And the need for that was underscored today in my interview with the new U.S. border czar, Alan Bersin. 

(BEGIN VIDEO CLIP)

ALAN BERSIN, US “BORDER CZAR”:  We know that narcotics use in the United States is a major cause of drug trafficking organizations and their power in Mexico.  The president, Secretary Napolitano, Secretary Clinton and Attorney General Holder have acknowledged that.  That creates a major new opportunity for speaking clearly and directly between Mexico and the United States to deal with a common problem. 

The danger is that it is a national security issue for both the United States and Mexico.  We know that with regard to drugs, that we can most effectively confront this working with our Mexican neighbors.  In fact, it‘s very difficult without cooperation from Mexico to deal with much of the situation we face. 

This is a very special time in history in which President Calderon and his government have basically taken on the drug cartels.  It‘s an enormously courageous step on his part, and a very important step for the government of Mexico. 

It‘s an opportunity to put aside past differences, the kinds of divisions that we‘ve had government to government, and to focus in a cooperative fashion on a common problem. 

(END VIDEO CLIP)

POTTER:  Now, these outbound vehicle searches that you‘re seeing are being done on a random basis by agents who have come in from around the country.  This is being done throughout the southwest border.  Some agents say that even this, along with increased investigations of money laundering and drug trafficking, are not enough to tackle the problem.  But others say this is a really important first step toward developing cooperation in a two-nation drug war.  Ed? 

SCHULTZ:  Thanks, Mark.  Mark Potter, NBC News in Laredo, Texas tonight on THE ED SHOW.

Let‘s turn back to our panel, Bill Press, Michael Smerconish, and Laura Flanders.  Bill, how does President Obama get a victory on this? 

PRESS:  First of all, Ed, I think it‘s important that he‘s putting it on the front burner, making it a high priority.  You know, you can‘t fix the problems there unless you fix the problems here.  Drugs, we demand them.  Guns, we supply them.  Illegal immigrants, we hire them.  Trade, American firms go down there and screw American workers. 

So it‘s a tough issue for President Obama.  At least he‘s taking a lead on it. 

SCHULTZ:  Laura, does this set up the anti-gun/pro-gun conversation in America? 

FLANDERS:  Well, it‘s already up and running, but it‘s an indication of politics in Washington, that it‘s easier to take on the drug cartels with the other initiative coming out of the Obama administration—the drug cartels in Mexico than it is to take on the gun cartels in Washington.  The two words you didn‘t hear in that report were assault weapons.  Three words, assault weapons ban.  That‘s where this conversation is going to go. 

SCHULTZ:  Michael, what do you think the president has to do?  Is he on the right track, do you think? 

SMERCONISH:  I think it‘s another manifestation of porous borders.  There is a legitimate gun issue here, but it‘s the same old, same old.  To raise the issue, it‘s to be cast as a xenophobe.  But the reality is that the Mexican border remains porous.  We need to close it.  We need to do something about it, Ed.  If he‘s willing to do that, then he‘s on the right track. 

SCHULTZ:  Michael, are you comfortable with the resources the president has put at the border right now? 

SMERCONISH:  I don‘t think he‘s yet put enough border resources where they need to be.  I don‘t know how many would be too many, in my book.  I‘ve regarded this as a real national security issue for a long, long time. 

SCHULTZ:  Bill, your take on it.  Does he need to do more? 

PRESS:  Ed, the first thing he‘s got to do is renew the ban on assault rifles.  Laura is absolutely right.  That‘s where it starts.  Cut off the supply.  That‘s the best thing we can do.

SCHULTZ:  But why do that to law-abiding citizens?  If we stop the border and close the border, where do the guns become a problem? 

PRESS:  Ed, they‘re still going to get down there, as long as we‘re selling those AK-47s.  Not taking guns away from lawful citizens or hunters, but impeding the supply to Mexico. 

FLANDERS:  Law-abiding citizens and hunters don‘t need assault weapons.  It‘s the anniversary of Virginia Tech today, people.  Why is this conversations still so difficult to have? 

SCHULTZ:  We have a problem.  We do have First Amendment, Second Amendment rights in this country.  There‘s going to be the conservatives out there that are going to say Obama is going to get your fire arm. 

FLANDERS:  There‘s a lot of sane gun owners and gun users and gun sellers who say we have to have laws that make sense.  We‘ve got to have bans that are in place.  And as long as we keep talking about a problem spilling from Mexico to hear, we‘re not talking about the real problem. 

SCHULTZ:  Quickly, Michael, is there a political opening here for conservatives? 

SMERCONISH:  The guns are not walking themselves across that border with Mexico.  It‘s a border control issue. 

SCHULTZ:  Thanks, appreciate it so much.  Michael Smerconish, Bill Press, and Laura Flanders with us tonight here. 

That‘s THE ED SHOW.  I‘m Ed Schultz.  For more information on THE ED SHOW, go to Ed. MSNBC.com or check out WeGotEd.com.  And you can have text alerts about THE ED SHOW to your phone.  Just text the word Ed to 622639.  We‘ll see you back here tomorrow night, 6:00 Eastern.  “HARDBALL” starts right now.

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