updated 6/11/2009 11:46:46 AM ET 2009-06-11T15:46:46

Guests: Mike Viqueira, Nancy Pelosi, John Barrasso, Brian Levin, E.J. Dionne, Todd

Webster, Michael Medved, Rep. Chris Van Hollen

(BEGIN VIDEOTAPE)

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

(END VIDEOTAPE)

SCHULTZ:  Good evening, Americans. 

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

Tonight, my exclusive interview with House Speaker Nancy Pelosi.  I went looking for answers and I got them about a public option for health care, never-ending spending for the war in Iraq, and how she feels about being a Republican target.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER:  A bill will not come out of the House without a public option.

The whole war to me was a giant mistake.

Our success is driving the Republicans to distraction.

(END VIDEO CLIP)

SCHULTZ:  My interview with the speaker coming up in just a moment. 

Righties are on the attack against Democrats on the economy.  We‘ll tell you what they‘re saying and we‘ll show you new poll numbers from some key races in our next half-hour. 

And the new head of General Motors says he doesn‘t know anything about cars.  OK.

Plus “Psycho Talk.”  

All that and a great panel coming up tonight. 

But first, some breaking news, and shocking and sickening news, a crime at the Holocaust Museum in Washington around 1:00 this afternoon. 

An 88-year-old known white supremacist allegedly open fired inside a Museum and took the life of a special police officer.  NBC‘s Mike Viqueira is on the scene with the latest on this.  We‘ll have more on that in just a moment, a horrific crime. 

It was a veteran of six years shot on the scene and killed today.  Mike Viqueira has been covering this all day and we‘ll have more on this in just a moment. 

But first, tonight‘s “OpEd.” 

I went over to the Capitol today to talk with Nancy Pelosi, speaker of the House, and talk about a number of different things when it comes to how she‘s doing.  I wanted to ask the speaker what we can expect in a health care bill. 

There‘s been so much talk about, number one, how we‘re going to pay for it, what it‘s going to be, what it‘s going to contain.  But most of all, what Americans want. 

And Nancy Pelosi is a dedicated professional.  She has taken a lot of heat from the conservatives.  And she wants universal health care.  She thinks the war in Iraq was a giant mistake.

But the speaker has got a lot on her plate.  When President Obama needs a bill, he calls Nancy Pelosi.  She‘s got to get the Democrats on board, and she has a history of doing that.  Democrats have been winning in a lot of places around the country, and these days the Democratic Caucus is a big tent, and a lot of different ideas and needs. 

She‘s got to deal with the party of “no.”

A shift in power has been hard for the conservatives to take, and she‘s done it really well.  She‘s usually the first person the president of the United States calls when he‘s got to get something done when it comes to signing a bill or rolling out a new policy at the White House. 

She does it all while being the righties‘ favorite political punching bag.  So I have a lot of respect for the speaker. 

I went to her office today at the Capitol, looking for some candid answers about a public option and a health care bill, working with radicals in the Congress, and the endless stream of money we‘re spending on Iraq. 

(BEGIN VIDEO CLIP)

SCHULTZ:  Reform, overhaul, these are words that are thrown out there when we hear about health care in this country. 

Define that. 

PELOSI:  Well, what we are talking about is affordable, quality, accessible health care for all Americans.  It‘s about choice.  If you like what you have and you want to keep it, you have the choice to do that.  But what we want to do is make sure that every American has the opportunity to health care.

And it‘s about—it‘s about something that is important for our economy.  We know it‘s important in the individual lives of the American people, but it‘s also about our economy.  So we have to do it in a way that makes people feel more secure personally, makes America healthier, is good for our economy, our small businesses, and the rest, and then also reduces our entitlement costs. 

SCHULTZ:  So you are in favor of a public option.  And what does that mean? 

PELOSI:  A public option is an option that would be available to people, and perhaps it will be renamed something else.  But the opportunity for us to have, alongside of the private sector companies, an option that is a public option. 

The point of that is to make sure that every American has the opportunity to have quality, affordable health care.  Again, many Americans are—I won‘t say perfectly satisfied, but like the plan that they are in and maybe they want to make it better.  And that‘s what we‘re saying.  If you want to go that route, you go that route.  It doesn‘t cost you anything if any more people have access to a public option. 

SCHULTZ:  And you can guarantee to the American people that‘s what‘s going to come out of the House?

PELOSI:  Well, I‘m saying the converse.  A bill will not come out of the House without a public option. 

(END VIDEO CLIP)

SCHULTZ:  Well, you heard the speaker right there.  A bill will not come out of the House without a public option.  She directly tells me that single payer is not going to happen. 

The Republicans are against any public option.  We‘ll talk later in the show with one Republican about what he thinks the president means when it comes to a bipartisan plan. 

What about taxing benefits?  I asked the speaker whether she would take raising taxes off the table. 

(BEGIN VIDEO CLIP)

SCHULTZ:  You‘ve mentioned being able to pay for it.  Are you willing to raise taxes to pay for it? 

PELOSI:  Everything is on the table.  Everything. 

SCHULTZ:  Are you going to support taxing health care benefits? 

PELOSI:  Everything is on the table, and our chairman of our Ways and Means Committee has not been receptive to that point of view.  But again, we want to have quality, affordable accessible health care for all Americans. 

SCHULTZ:  OK. 

Now, Mr. Rangel, I understand, is willing to talk about taxing employer benefits. 

Would you be in favor of that? 

PELOSI:  Of his talking about it? 

SCHULTZ:  Well, would you support taxing—you personally support...

PELOSI:  I said everything is on the table.  We have to see what the package is, how it is scored by the CDO, how much of a shortfall there is, and what it takes to make to cover the shortfall.  Everything is on the table. 

SCHULTZ:  So you‘re not willing to say that, you know, taxes are going to go up because of health care reform. 

PELOSI:  No.

SCHULTZ:  I mean, you‘re not ready to make that...

PELOSI:  No, but I‘m saying everything is on the table. 

SCHULTZ:  OK.

(END VIDEO CLIP)

SCHULTZ:  Everything is on the table. 

Folks, this is what I think the Democrats have gotten in trouble with in the past, to say everything is on the table, no matter what the issue is.  But just come out and tell the American people that your taxes are going to go up. 

The American people aren‘t stupid.  I‘m not stupid .  I can do the math.  You can‘t cover 50 million people who don‘t have health care unless there‘s more money coming into the system. 

The president just made a big comment the other day with some backup of the Senate that, gosh, we‘ve got to have pay-go.  We‘ve got to pay for everything as we go along.  Well, what does that tell you? 

The fact is—and let‘s be up front about this.  I don‘t care how much it costs.  I want to see—I actually would love to see the private sector get some competition when it comes to health care in this country, because that would really mix them up.  Just think about all these great stories we‘d have. 

Not only that, but the point is, is that if we are going to get 50 million people covered in this country, if we‘re going to bring costs down, it‘s obviously going to take some money out of the Treasury.  The Democrats, I‘m warning, are going to get in trouble because they‘re not being completely honest with the American people. 

I‘m not say she‘s dishonest.  I‘m just saying come right out and say it, that your taxes are going to go up if we‘re going to do health care. 

Now, what do you want to do?  Do you want to do health care, or do you want to keep it the way it is right now and taxes are high anyway? 

So, I‘m struggling with the way the Democrats are framing this right now.  A little bit more up-front talk with the American people. 

Now, the speaker of the House has had her battles with the conservatives over the years.  In recent months she‘s really been their favorite target.  Now, keep in mind, the political landscape has shifted under her leadership.  She deserves credit. 

(BEGIN VIDEO CLIP)

SCHULTZ:  Let‘s talk about the Republican Party for just a moment. 

When you came into a leadership position, you were House minority leader.  They had the White House, the House and the Senate.  And now, six, seven years later, a major newspaper in the United States today shows that most Republicans don‘t even know who speaks for the Republican Party, and none of these are decision-makers. 

How satisfying is this to you? 

PELOSI:  Look, I‘m just glad we have Barack Obama as the spokesperson for the—a president of the United States... 

SCHULTZ:  But these are the people that have repeatedly attacked you. 

PELOSI:  Well, they have to deal with themselves. 

SCHULTZ:  All of these at one time or another have repeatedly attacked you.  And do you feel...

PELOSI:  I don‘t spend much time thinking about that.  What I do think is that we need a strong, viable Republican Party in our country.  And that‘s why I say to my friends who are Republicans, take back your party. 

SCHULTZ:  Do you have them where you want them? 

PELOSI:  Well, I like being in a very strong majority in the Congress of the United States, there‘s no question about that.  But hopefully—you know, we‘re not here to say we have the White House, the Senate and the House, and that‘s the way we like it. 

No, we want the competition of ideas.  We welcome the debate. 

Sometimes people think why can‘t they work together the way I have a conversation with my Republican neighbors?  Well, that‘s because there‘s a big—not as much difference, I think, among Democrats and Republicans in the country as there is between Democrats and Republicans in the Congress. 

We‘re dealing with a radical right-wing element that has taken control of the Republican Party.  And we would welcome back the strength, the ideas, the leadership of the Republican Party as we knew it, the Grand Old Party, out in the forefront on issues relating to civil rights and protecting the environment, and issues like that instead of the obstructionists just saying no, the Republicans in the Congress. 

We always strive for bipartisanship.  That‘s our responsibility, to find common ground. 

The American people expect and deserve that.  But if we can‘t, we cannot be held up by the lack of it.  We just have to move because the country has been going in the wrong direction under Republican leadership for a long time. 

And now we‘re trying to turn that around, take the country in a new direction, listen to their ideas, hopefully incorporate them.  But if they just want to say no, we can‘t stop.

(END VIDEO CLIP)

SCHULTZ:  We‘ll have more in my exclusive interview with House Speaker Nancy Pelosi at 6:30.  She talks about why her GOP colleagues are going after her on torture and she says they‘re driven to distraction.

But first, more on that deadly shooting at the Holocaust Museum here in Washington earlier today.

NBC‘s Mike Viqueira is on the scene with the latest.

Mike, what can you tell us?  The latest, but also how thing whole thing unfolded today.

MIKE VIQUEIRA, NBC NEWS CORRESPONDENT:  Well, here‘s what we know, Ed.

An individual identified as James von Brunn from close by here on Maryland‘s Eastern Shore, just on the other side of the Chesapeake Bay from the Washington area, born in 1920.  At 12:50 p.m. this afternoon, he walked up to the Holocaust Museum right here on 14th Street in the midst of monuments and agencies, amid thousands of tourists here at the end of the school year with school groups. 

He had a rifle that was quite apparent.  He walked towards the door of the Holocaust Museum and apparently he opened fire. 

Two security guards there engaged him.  The shooter, reputed to be Mr.  Von Bronn, was injured.  One of those security guards, we understand—we learned at about 4:00 this afternoon Eastern Time has succumbed to his injuries.

There was one other relatively minor injury.  We do not know the status of Mr. Von Brunn.  The latest we heard was that he was in critical condition. 

We talked to a number of eyewitnesses, Ed.  Many of them were aware of what was going on, could hear the shots. 

I talked to one gentleman visiting from Florida with his wife, an elderly gentleman, said he saw an individual, probably the shooter, laying about halfway inside the door of the Holocaust Museum and half of him was outside on the sidewalk.  I talked to another family, a mother and a daughter visiting here from Austin, Texas.  They were on the third floor and they were hustled out of the building very efficiently. 

And nothing but praise for officials here.  There was no panic, but you can imagine the feeling of many of these folks visiting the Holocaust Museum, a very solemn atmosphere, and then to have something reputed to be of such—an expression of such hate, because Von Brunn was associated—or is associated with anti-Semitic teachings, a white supremacist who has been in trouble before.  Arrested, as a matter of fact, threatening the Fed board of governors.  Apparently arrested back in the ‘80s after brandishing weapons close to some Fed governors who were meeting at the Federal Reserve.

So, Ed, a solemn atmosphere here in Washington today.  They‘re just getting the streets back open again, trying to get things back to normal.  The museum, of course, is closed.  We do expect to hear from museum officials very shortly. 

SCHULTZ:  Mike Viqueira on the scene at the Holocaust Museum in Washington, D.C.

Thanks for that report, Mike.

A very sad day here in the nation‘s capital. 

I want to know if the Republicans are serious about fixing health care.  Don‘t talk about socialist takeovers or rationing.  I want to hear some solutions. 

Senator John Barrasso of Wyoming joins me next on THE ED SHOW.

Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PELOSI:  I don‘t see any way that the House of Representatives will pass a bill that doesn‘t have a very viable public option. 

(END VIDEO CLIP)

SCHULTZ:  That was from my exclusive interview today with House Speaker Nancy Pelosi.

The speaker told me everything is on the table when it comes to health care reform.  More from my interview in the next half-hour.

Meanwhile, the president held a surprise meeting with the four leading senators in the health care debate today.  The takeaway from that meeting?  President Obama is flexible about the plan but he wants something by July.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE:  I think the president can play a very important part in bipartisanship.  He told us he wanted a bipartisan bill. 

UNIDENTIFIED MALE:  We all are flexible on all these points.  We are, the president is. 

(END VIDEO CLIP)

SCHULTZ:  The senators said they discussed three or four sticking points but wouldn‘t get into details.  So far, all I‘ve heard from conservatives is a refusal to do anything. 

How do the conservatives plan to address a system where there‘s 14,000 Americans who are losing their health care every day? 

To help us answer that question, we‘re joined tonight by Republican Senator and Dr. John Barrasso, Mr. Senator, great to have you with us tonight. 

When you hear “public option,” what do you think?  What does that mean to you? 

SEN. JOHN BARRASSO ®, WYOMING:  Well, it means a Washington takeover of health care in this country.  It means that people will ultimately lose their choices.  It will be such a tilted playing field that it‘s not what the people of America want, which is a system like Canada or a system like England, where you undoubtedly run into a delay in receiving care, long waiting lines, where people in Canada—you have, what, 750,000 people right now waiting for an operation, 3.5 million waiting to see a doctor? 

And if you even get to your family doctor, then you end up in a situation like people are in Canada, where they‘re waiting 17 weeks, you know, four months, just to see a specialist.  . 

SCHULTZ:  Isn‘t that a fear tactic you‘re playing, Senator?  How do you know it would be like that in the United States if we were to offer up a public option to the American people? 

BARRASSO:  Well, Howard Dean, former chairman of the Democratic National Committee, on MSNBC the other morning said that.  If you have such a plan like this and a Washington takeover, what you end up doing is raising taxes, which the speaker just said on national TV on your show that she‘s willing to do, and you end up limiting services. 

And, you know, I practiced medicine for 25 years.  And when you were at Moorhead State you saw it.  You saw the people coming down from Canada to the Fargo/Moorhead area for health care because they couldn‘t take the time to wait in Canada. 

SCHULTZ:  Well, actually, Senator, respectfully, no.  I never saw that. 

In fact, I have a sister who lives in Canada who doesn‘t complain about health care.  And the majority of Canadians don‘t care about it either.  And where is this wave of Canadians coming down to the United States?

I respect your opinion, but I respectfully disagree. 

Now, when it comes to taxing benefits, would you be in favor of that?  Where is this bipartisanship going to come from?  What are you willing to compromise on?  What are the Republicans willing to compromise on? 

BARRASSO:  I want to work in a bipartisan way, and I want to work to give people incentives to stay healthy.  And that‘s the way to help keep down the costs of their health care.

Fifty percent of all the cost of health care in this country, Ed, are just five percent of the people.  And they‘re the people that eat too much, exercise too little and smoke.  And that‘s—if we deal with those five percent of the people, we can save enough money to solve the rest of the problem. 

It‘s giving the right incentives all across our country.  We did it in Wyoming.

I was the director of the Wyoming health fairs.  We blood-tested people for high cholesterol, for prostate cancer, for thyroid conditions, detecting problems early.  That‘s what we need to do to get part of this plan as a real incentive program to keep people healthy. 

And then we have a whole change in society from when this system was put into place back in the 1940s.  We have people changing jobs seven, eight, nine times.  The health insurance ought to stay with them.

It belongs to the individual person, not to the company that they‘re working for.  And we ought to let people buy insurance across state lines.  If they can shop around for a better deal, they ought to be able to get it. 

Those things will help keep the costs down, Ed. 

SCHULTZ:  But Senator, I really think a public option clearly would help keep costs down.  Competition is a great thing.

Right now you say that you don‘t want a Washington takeover.  What I think and what a lot of Americans think is we‘ve had an insurance industry takeover where they deny coverage and they dictate what the rates are.  We get no explanation.  And over the last eight years, I have to say the conservatives, when they were in power, did nothing to keep costs down.  And I think that‘s really where we have to go. 

Senator...

BARRASSO:  Nobody should stand between a patient and their doctor, not an insurance bureaucrat and not a Washington bureaucrat either, Ed. 

SCHULTZ:  Well, if they‘ve got a check in their hand that‘s going to pay the bill, I think a lot of Americans would go along with that.  And by the way, under Medicare, there is choice, correct? 

BARRASSO:  Medicare is the biggest deadbeat payer in the country.  It is also the biggest system for waste, fraud and abuse.  And I‘ll tell you, this government ought to be ashamed of itself. 

SCHULTZ:  OK.  Please come back and let‘s continue our conversation. 

BARRASSO:  Happy to do it, Ed.  Thank you very much.

SCHULTZ:  It‘s good to have you with us.  Thank you.

BARRASSO:  My privilege.  Thank you.

SCHULTZ:  Next up on THE ED SHOW, “Psycho Talk.”   A righty compares President Obama‘s speech in Cairo to Hitler before World War II. 

It‘s next in “Psycho Talk.”  

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  In “Psycho Talk” tonight, “Washington Times” commentator and former assistant secretary of defense Frank Gaffney. 

In an opinion piece for The Times Gaffney suggests Barack Obama is America‘s first Muslim president.  Then he compares the president to Adolf Hitler. 

“The man now happy to have his Islamic-rooted middle name featured prominently has engaged in the most consequential bait and switch since Adolf Hitler duped Neville Chamberlain over Czechoslovakia at Munich.”

Obama has duped America like Hitler duped Chamberlain.  Did you get that?

Gaffney argues we‘ve all been misled because “... there is mounting evidence that the president not only identifies himself with Muslims, but actually may be still one himself.”

So what is the evidence here?  Gaffney lays it out in bullet points. 

Here‘s the gist.

In an Obama speech in Cairo, he talked about having some familiarity with Islam and he used Muslim religious lingo.  You know, words like the “Holy Koran.”

Gaffney‘s argument is that non-Muslims generally don‘t use that Islamic formulation.  Therefore, he must be Muslim, right? 

There can be no other conclusion than this is pure “Psycho Talk.” 

It‘s bigoted.  It‘s dead wrong.  It‘s more conspiracy theories about Obama being a secret Muslim. 

And once again, here we have the right-wing fringe engaging in dangerous “Psycho Talk.” 

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  We‘re getting more details about the white supremacist who allegedly opened fire today at the Holocaust Museum here in the nation‘s capital.  The shooting took the life of Special Police Officer Stephen Tyrone Jones.  The suspect, 88-year-old James Von Brunn, has a hate-filled website where he attacked Jews and minorities.  He has a violent past with a prior conviction. 

Joining me now is Brian Levin.  He‘s the director of the Center for the Study of Hate and Extremism at California State University in San Bernardino. 

Professor, did you know about this particular individual who did the shooting today, allegedly did the shooting today? 

BRIAN LEVIN, CALIFORNIA STATE UNIVERSITY:  Yes, I did.  But in fairness, when I was asked by a reporter, I said this name sounds familiar, I know this guy.  He said, does this website ring a bell?  I said yes, I know this guy. 

But, you know, he‘s someone who had an arrest going back to 1981, when he tried to hit the Federal Reserve Building.  He went there with a shotgun.  He blamed a Jewish and black jury and judge for going after him. 

He has this book—I‘m going to hold it up, guys.  I might block my face.  He has this book, which is an anti-Semitic screed.  And chapter six is about the Holocaust hoax. 

Interesting enough, I studied at the Holocaust museum at a special program, not so much because I‘m an analyst of the Holocaust, but because I studied Holocaust deniers and the neo-Nazi movement.  This is someone who belongs to a cultish conspiracy ideology that says Jews control the Federal Reserve and the banking system.  Notice, he went after the Federal Reserve Building back in 1981. 

And he also says that Jews control the thought process.  That‘s why the Holocaust museum is a target, because the Holocaust Museum, you may not know, is actually a national government museum.  So this is part of the conspiracy world he lives in, where Jews control banks.  They do mind control.  And they have their hands at the levers of the government. 

And he has the most horrible anti-Semitic stuff in his writings and on his website. 

SCHULTZ:  Now, has he had a long history of posting this stuff on websites?  Because—and I don‘t know if this plays to it or not?  But the Department of Homeland Security came out with a report in April that warned Americans of right wing extremist activities.  And since then, we‘ve had three shootings in this country. 

Is there any way to predict this kind of stuff when these people get so dog-gone violent on websites and in their hate speech? 

LEVIN:  Here‘s the thing; this guy has been in the movement for decades.  So this is someone who actually had a record.  I don‘t think necessarily recent developments were something that caused him to join the movement.  He‘s been in the movement far long time. 

But look at this fact, President Obama and Elie Wiesel just did an address at Buchenwald over the weekend.  There‘s a hate crime bill up before the Senate, which people in his world and his belief system say is an attempt to limit free speech and punish those who deny the Holocaust.  There‘s also a big denial conference coming up in California in July. 

So this is someone who I think has been involved in the movement for some time.  This report that came out, while it did have a couple of flaws, I think was dead on about the trends.  But he didn‘t join the movement because of these trends.  He‘s had his card punched for decades. 

SCHULTZ:  Dr. Levin, thanks so much for joining us.  I appreciate it. 

Let‘s turn now to more of my interview with House Speaker Nancy Pelosi.  The speaker talked about what it‘s like to be a victim of Republican attacks, and why she thinks the GOP went after Sonia Sotomayor. 

(BEGIN VIDEOTAPE)

SCHULTZ:  How do you feel about the way—switching gears to the Supreme Court nominee—the attacks that have been levied upon Judge Sonia Sotomayor? 

PELOSI:  I think that what you see here is that President Obama‘s success and the quality of his appointments, including Judge Sotomayor, and even what we do in the Congress, probably—especially because of the success we‘re having in the Congress—is driving the Republicans to distraction.  And that‘s what they‘re engaged in across the board.  How do they distract the public from jobs, health care, education, and energy policy that takes us into clean energy jobs and into the future, how we reduce the deficit as we turn the economy around. 

SCHULTZ:  They‘ve questioned her intelligence.  They‘ve labeled her a racist and then somewhat backed off that.  Is this new territory? 

PELOSI:  No, I think they‘ve been doing this for a while.  I think anybody who gets in the arena realizes that they become a target.  I don‘t think there‘s a real market for attacking a Supreme Court justice.  That‘s really not political.  The rest of us who are in the arena, we know that if you throw a punch, you better be ready to take a punch.  But in terms of a justice of the Supreme Court, I don‘t know what the purpose—

SCHULTZ:  She‘ll do well? 

PELOSI:  I have every confidence that she will be confirmed. 

(BEGIN VIDEO CLIP)

SCHULTZ:  Time to bring in our political panel tonight, Democratic strategist Todd Webster, “Washington Post” columnist E.J. Dionne, and also radio talk show host Michael Medved, author of the book “The Ten Big Lies About America.”

E.J., let‘s start with you tonight.  I was captivated by the speaker today, interviewing her.  She is command of where she wants to go in an interview.  Somewhat vague at times, but then somewhat very direct at times.  I pointed out that when she took over in a leadership position for the Democrats, it was total minority, White House, House and Senate.  Can‘t she claim some victories along the way now, where she is, and some of the things that have taken place for the Democrats? 

E.J. DIONNE, “THE WASHINGTON POST”:  Yes, I think she‘s very tough, very smart, and pretty consistently underrated.  When you look at what she‘s gotten this very diverse group of Democrats to do—that old Will Rogers line, I don‘t belong to an organized political party, I‘m a Democrat; that sure applies to that House caucus she has to run. 

She‘s made some mistakes along the way.  I think her handling of the way she talked about her briefing, she created a controversy I don‘t think she wanted.  Even though, I think what she said may have well been true, that she didn‘t get fully briefed.  But on the whole, she‘s gotten a lot done. 

SCHULTZ:  I had an exchange with the House speaker today on torture. 

This is what she had to say. 

(BEGIN VIDEO CLIP)

SCHULTZ:  Do you think you the speaker of the House are square with the American people on what you knew about torture? 

PELOSI:  Again, I‘m speaker of the House.  The speaker is always a target.  I‘m having great success legislatively here.  As I said, our success is driving the Republicans to distraction.  This is one of their distractions and they know it. 

SCHULTZ:  OK.  So there‘s no question that you didn‘t know everything. 

PELOSI:  I‘ve said what I‘m going to say on that subject.  And I‘ve said it very clearly. 

SCHULTZ:  Do you think there will be a lingering affect in the intelligence community at all, when it—on future issues? 

PELOSI:  What will have to happen is that Congress will have to be more fully and in a more timely way briefed by the intelligence committee, so that we can honor our responsibilities to protect and defend the Constitution. 

SCHULTZ:  Does the president—are you in line with him?  Do you support him on every move he‘s made when it comes to releasing information. 

PELOSI:  I don‘t know what all of the moves he‘s made.  But I support the president of the United States.  I do not support any effort on the part of those who have suggested that Congress should take exception to the Freedom of Information Act in order to keep the documents under cover. 

(END VIDEO CLIP)

SCHULTZ:  Michael Medved, your response to that exchange?  Are you satisfied with Nancy Pelosi‘s answers? 

MICHAEL MEDVED, RADIO TALK SHOW HOST:  No, I‘m not and I‘ll tell you why, Ed.  I actually believe that the best thing for the whole country would be to put this thing behind us.  But there is a contradiction.  If she‘s saying, we need to investigate what everyone knew and authorized about harsh interrogation, except for me.  If she‘s going to go forward with a truth commission and a big investigation, well, of course, she‘s going to be a target of it as well.  You can‘t exclude yourself from that. 

SCHULTZ:  She said, Todd Webster, that she wants more information to the intelligence committees in the Congress.  What do you think? 

TODD WEBSTER, DEMOCRAT STRATEGIST:  As she said, it‘s a right wing distraction.  It means nothing.  Even had she been briefed, she couldn‘t say anything about it anyway, because they‘re national security matters.  But look, this is a very tough, very strong speaker of the House. 

Republicans don‘t like her. 

If you look at what she‘s done just in the last six months, the Lily Ledbetter Fair Pay Act, to make sure that my daughter doesn‘t have to suffer pay discrimination and get paid 78 cents on the dollar for a—to what a man is getting paid; the stimulus bill; the Credit Card Holders Bill of Rights that‘s been passed through the House—she‘s been tough.  She‘s got a legislative record that‘s compelling and very successful.  And Republicans don‘t like that.  It drives them nuts. 

MEDVED:  I‘ll tell you, Republicans like it a lot.  If you take a look at Nancy Pelosi‘s approval rating, it is below Dick Cheney‘s.  It‘s way down there.  I would much rather have Nancy Pelosi speaking for your party than Barack Obama, who does a much better job. 

WEBSTER:  But what you, Michael Medved, or any right wing person thinks doesn‘t matter.  She‘s elected by her constituency in California, by the Democratic caucus. 

DIONNE:  But the good news for Democrats is their ability to hold the House probably still depends more on what people think about Barack Obama than what they think about Nancy Pelosi.  Sometimes somebody like that is a bit of a lightning rod for Obama. 

SCHULTZ:  But I just think that Democrats have been too critical of Nancy Pelosi.  I‘m a supporter.  I believe that—I mean, when she started, she mapped out a strategy, helped a lot of people win House seats.  And I think she deserves some credit.  It‘s not easy being a target the way she has been.  Go ask your old friend, Tom Daschle. 

WEBSTER:  She passed the toughest ethics bill in the history of the Congress.  She passed the first minimum wage increase in ten years. 

MEDVED:  She‘s really done a good job in terms of pork spending, right? 

WEBSTER:  Let her be the lightning rod. 

MEDVED:  It‘s not just me.  A 31 percent approval rating, I believe, maybe even less than that.  It‘s not just Republicans who are rejecting Pelosi. 

WEBSTER:  It just doesn‘t matter, though, Michael.  That‘s the point.

It‘s inconsequential what you or anyone thinks of her. 

SCHULTZ:  Hold on, Michael.  E.J., your thoughts. 

DIONNE:  First of all, if you look at Democrats she serves with, they‘re not being critical of her, which is the most important thing, since that‘s her first electorate she has to answer to. 

Secondly, Michael is right, her poll ratings are not that high.  But again, I think what matters more is how do people view the state of the country and the president of the United States.  And if they feel OK in November of 2010, Nancy Pelosi is going to stay as speaker. 

SCHULTZ:  Gentlemen, we‘ll come back.  Coming up, Republicans are going after Democrats on the economy.  Two bellwether races show there could be trouble in 2010.  Congressman Chris Van Hollen coming up next in my playbook.  Stay with us. 

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA:  The pay as you go rule is very simple: Congress can only spend a dollar if it saves a dollar elsewhere.  And this principle guides responsible families managing a budget.  Entitlement increases, and tax cuts need to be paid for.  They‘re not free.  And borrowing to finance them is not a sustainable long-term policy. 

(END VIDEO CLIP)

SCHULTZ:  President Obama has laid out new budget rules to keep the nation‘s checkbook balanced.  But he made one very key exception, and that would be health care.  The president authorized up to 2.5 trillion dollars to jump start health care reform.  And he‘s given Congress a few years grace period before they got to pay for it.  But that‘s still you and me having to do something about it. 

I applaud the president.  I‘m all for health care reform.  He thinks that it proves he wants law makers to look at the big picture for solutions and not really get bogged down in the nitty-gritty.  We have nearly 50 million people without health care coverage in this country, families paying astronomical premium increases, insurance companies just milking consumers, and businesses just fattening their bottom line on this. 

We are in a state of emergency when it comes to health care.  And I don‘t care personally how much it costs.  We need to fix this.  Let‘s bring back our panel here.  E.J., we‘ll start with you.  The president openly saying OK, we got to do a pay-go thing, but it‘s OK to borrow if we‘re going to fix health care.  How does that square with you? 

DIONNE:  He, at the beginning, in his first budget, in the budget he put out at the beginning of the year, had a way to pay for health care.  He said let‘s put a 28 percent lid on deductions for well to do people.  That got immediately shot down by Democrats, as well as Republicans.  And so he‘s saying OK, you don‘t like that way of paying for it, you tell me how you‘re going to pay for it. 

So he hasn‘t been reluctant to put certain new taxes on the table.  The ones he put on the table the Congress didn‘t want.  I think we‘ll end up having some taxes to pay for health care.  I think, in the end, people will support it reluctantly.  Nobody wants a tax increase in the middle of a downturn, but I think people do want some security on health care. 

SCHULTZ:  Michael Medved, is there any way the Republicans could come up with a plan to reform health care, or enhance the situation for Americans without raising taxes? 

MEDVED:  I think it‘s very difficult.  And yesterday, I had Senator Byron Dorgan, who is a conscientious Democrat from North Dakota, on my radio show.  And he said unequivocally he would not support a health care reform plan that didn‘t pay for itself, that put us further and further in debt. 

I think this is really where the rubber hits the road, is that either party—it is going to be very, very difficult to have some kind of a sweeping health care reform, either Republican or Democratic, without figuring out something else you can cut or some way that you can increase revenues to pay for it.

SCHULTZ:  What do you think? 

WEBSTER:  Look, my health care premiums from my company went up 35 percent for next year.  So the alternative to continuing to have these astronomical health insurance premium increases—

SCHULTZ:  So Todd, do you think the American people are willing to shell out more money for health care reform? 

WEBSTER:  I think, at some point, it‘s going to have to happen.  I think it didn‘t work particularly well for Walter Mondale in 1984 to publicly announce that you‘re going to go raise tax.  But I do think that the American people are smart enough and sophisticated enough.  I think they have faith in Barack Obama and what he‘s doing. 

But, you know, you talk about deficits and it‘s important to recognize that under eight years of Bill Clinton, he increased spending and he increased the budget 11 percent.  Under eight years of George Bush, six of those with a Republican Congress, he increased the government budget 104 percent. 

So we‘re now paying for the sins and the party of the eight years of the Bush administration. 

DIONNE:  You know what‘s frustrating about this to me is that we go to war in Iraq; no one says we got to figure out in advance how to pay for it.  We have this huge tax cut for the wealthy under President Bush; no one says, oh, we got to worry about the deficit. 

But when you put health care on the table, when you say we want to cover 50 million people without health insurance, suddenly everybody is a fiscal conservative.  And I think what that is is a battering ram to kill health care reform.  I think you should pay for it.  I think we should figure out how to make it budget neutral.  But we can‘t let this argument about paying for it get in the way of getting the thing done.

SCHULTZ:  Yes.  Michael, got to give you a chance to respond to that.  Why is it that the only time conservatives are uptight about money is when we talk about health care? 

MEDVED:  It‘s not just when you talk about health care.  It‘s certainly when you talk about cap and trade, when you talk about a stimulus package, when you talk about spending us into a 1.8 trillion dollar deficit, which is where we are today, even without the health care spending. 

Look, the truth of the matter is war and peace, issues of national defense—you may disagree with the Iraq war, but if you believed that the Iraq war was necessary for our national security, then the cost is no object.  If you believe, for instance, that actually cutting taxes is a way to stimulate the economy more effectively then spending money, then, yes, that‘s very different than new, mandatory—

DIONNE:  I think you just made my point, Michael.  Bless you for that. 

SCHULTZ:  Gentlemen, good to have you with us.  Minority Leader Eric Cantor thinks the GOP will take the House back in the midterms.  We‘ll talk about that next on THE ED SHOW.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  In my playbook tonight, primary numbers; the race for 2010 is really already on.  The GOP has already put their cards on the table.  They‘re going to run by attacking Democrats as socialists.  A new poll this week showed a majority of voters thinks President Obama is doing a good job as president.  But they‘re still split over how he‘s handling spending and the deficit. 

I think the president is doing the right thing on the economy.  The numbers are going to come around.  But unemployment right now is high.  You can‘t deny it.  Credit is still tight.  In two key races this year, there are signs of a backlash, a backlash against Democrats.  In the state of Virginia, the governor‘s race, former Clinton guru Terry McAuliffe lost the primary last night.  The state senator who beat him, Creigh Deeds, is trailing his Republican challenger.

In New Jersey‘s governor race, the Republican, Chris Christie, is leading Democratic incumbent and former Senator Jon Corzine by ten points.  Joining me now is Congressman Chris Van Hollen, chairman of the DCCC.  Chris, good to have you with us tonight.  Are these scary trends, or is this no big deal for the Democrats?  What do you think? 

REP. CHRIS VAN HOLLEN (D), DCCC CHAIRMAN:  They‘re not scary trends.  In the one Congressional race we had, the special election up in New York 20, where the key issue was about the president‘s economic recovery package, a Democrat Scott Murphy won that special election just a few weeks ago.  In fact, he came out of nowhere politically speaking to beat a very entrenched Republican, in fact the Republican leader in the New York Assembly. 

He closed 21 points in eight weeks.  The whole topic of that campaign was whether or not the candidates had supported the president‘s economic recovery package.  Republicans said no, Democrats said yes.  And in that district, the Republicans had over a 48,000 Republican registration advantage. 

SCHULTZ:  So Congressman, would you go so far to say Democrats are still on a roll? 

VAN HOLLEN:  Well, listen, we know what the history is.  I think it‘s very important that people understand that a new president‘s party does tend to lose seats in the midterm.  In fact, the average loss of seats since Abraham Lincoln was president is 30 seats. 

We‘re out to beat that history.  We know that history is tough for us, but I think that Eric Cantor should play back that tape of Karl Rove just a few years ago predicting permanent Republican majorities. 

SCHULTZ:  I‘m going to play this one for you.  Mr. Cantor had this to say about the upcoming elections.  Here it is.

He said, “I really believe that we have a shot at taking back the House, because you see what‘s going on here, with this unfettered ability of the administration and Nancy Pelosi to run this Congress.” 

He goes on to say, “the American people see that this agenda is way far out of the mainstream.  They want a check and a balance on the power.  And I think, at the end of the day, that‘s what rules come November 2010.” 

What what‘s your response to that, Chris? 

VAN HOLLEN:  The Republicans are not going to take back the Congress and they‘re not going to take it back because the American people don‘t want to turn back the clock and repeat eight years of the failed policies we saw under George Bush and the last Congress. 

And I want to ask Eric Cantor what he thinks is so radical about providing consumers protection against credit card abuses?  I want to know what‘s so radical about providing children with health care under children‘s health?  And what‘s so radical about launching a major economic recovery package, and at the same time introducing a budget that cuts the deficit in half. 

SCHULTZ:  Chris Van Hollen, Congressman, we‘re short on time.  I appreciate your time tonight.  I would ask the same questions, but I don‘t think he wants to do an interview with me. 

VAN HOLLEN:  These guys are status quo.

SCHULTZ:  Good to have you with us. 

Final page of my playbook tonight, let‘s talk about getting a job.  You‘re interviewing to run a restaurant, you wouldn‘t say I don‘t know anything about food.  You‘re interviewing to be a pilot, you wouldn‘t say, I don‘t anything about flying an airplane.  So you probably wouldn‘t get the job if you said those kinds of things.

So I don‘t know why the new chairman of General Motors, Edward Whitacre, can say in an interview that he doesn‘t know anything about cars.  He told “Bloomberg News” yesterday that it doesn‘t matter.  Quote, “I don‘t know anything about cars.  A business is a business.  And I think I can learn about cars.  I‘m not that old and I think that business principles are the same.”

Is this the, you know, guy that we‘ve put in charge?  A bean counter? 

I don‘t know about you, but I don‘t like interns on the job. 

That‘s THE ED SHOW.  I‘m Ed Schultz.  We‘ll see you back tomorrow night, live from New York City, 6:00 Eastern time, right here on MSNBC.  “HARDBALL” with Chris Matthews starts right now, on the place for politics, MSNBC.

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

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