updated 6/25/2009 10:57:25 AM ET 2009-06-25T14:57:25

Guests: Chuck Todd, Todd Harris, Dick Durbin, John Barrasso, Mike Allen, Gov. Jim Doyle, Sam Stein, Michael Graham, Bill Press

(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.

Well, another Republican sex scandal?  Governor Mark Sanford cries and says he‘s sorry.  I say he‘s a hypocrite using taxpayer dollars.

Senator Chuck Grassley draws a line in the sand on health care.  The number two Democrat in the Senate will respond to that on this show coming up.

A pathetic, pathetic Republican attack on President Obama.  How about a local guy (ph) in Maryland putting out material comparing the president to Hitler? 

Plus, “Psycho Talk,” all that, and a great panel coming up. 

But first, tonight‘s “OpEd.” 

Well, what do we have here?  The tabloid Party strikes again.  Gosh, we‘ve got another Jimmy Swaggart moment coming from the Republican Party. 

South Carolina—I have no mercy here, and I‘ll tell you why.  South Carolina governor Mark Sanford falls from grace, I guess you could say, admitting to an extramarital affair.  Deep in the heart of Dixie, where the Bible Belt is the birthplace of the conservative Republican movement and culture, we find yet another example of southern hypocrisy. 

After missing and being unaccounted for a number of days, South Carolina governor Mark Sanford emerges and, holy smokes, he had this personal bombshell announcement.  He‘s got girlfriend problems. 

(BEGIN VIDEO CLIP)

GOV. MARK SANFORD ®, SOUTH CAROLINA:  The bottom line is this: I‘ve been unfaithful to my wife.  I developed a relationship with a—what started as a dear, dear friend from Argentina.  It began very innocently.  About a year ago, it sparked into something more than that.  I have seen her three times since then, during that whole sparking thing. 

I spent the last five days of my life crying in Argentina so I could be with you when I come back here. 

I would never stand here before you as one who just says, yo, I‘m completely right with regard to my heart on all things.  All I can say is that I apologize. 

(END VIDEO CLIP)

SCHULTZ:  Hypocrisy, the cornerstone of the Republican Party. 

Now, a quick fact check tells us that Mark Sanford was one of the most critical opponents of Bill Clinton.  Sanford repeatedly called for Clinton‘s resignation.  He went on the record in 1999 in the wake of the Clinton affair and said this: “The issue of lying is probably the biggest harm, if you will, to the system of Democratic government, representative government, because it undermines trust.  And if you undermine trust in our system, you undermine everything.”

Well, now, the shoe is on the other foot.  And I think the people of South Carolina should stand up tonight and call for the resignation of their governor, Mark Sanford. 

Now, this is a guy who has fought President Obama on the stimulus package, he‘s made it a big issue.  They‘ve got deficits in South Carolina.  He‘s hurt a lot of families.  And I‘ll go so far as to say that this guy can‘t even run his own family. 

If you think that I‘m piling on tonight—oh, listen to you, Ed, holier than thou—no, no, no, no.  It goes with the territory. 

You‘re on the taxpayers dollars, you‘re on their dime and their time.  You have to be credible and you have to be accountable.  This is why we have lousy government in this country, because now we all want to be so compassionate with the taxpayer dollars. 

Don‘t tell me South Carolina doesn‘t get federal money.  The people of South Carolina are no different than anybody else around the country.  In fact, as the public, if we allow our public servants to get off just scot-free, without personal accountability, then as I say, we deserve a lousy government.

This guy is out fooling around instead of serving the people of South Carolina.  But the irony of it is he did give the people less government for five days, and they love that in the conservative arena. 

Just for the record, Sanford served in the Congress and was part of the Newt Gingrich revolution in 1994.  It looks to me like he took a lot of good notes from the Newtster on this issue. 

Now to a serious tone of all of this.  For more, let me bring in NBC News Political Director Chuck Todd.  He is also our chief White House correspondent. 

Chuck, is there a political future for the governor of South Carolina at this point?  Can he recover from this? 

CHUCK TODD, NBC NEWS POLITICAL DIRECTOR:  No.  I mean, no, he couldn‘t.  I mean, as you pointed out, it‘s a very conservative state, number one.  So, no.

I mean, I think he‘s—look, not all press conferences are like that.  It looked like he made the decision to just come out and dump everything out there after realizing that there was quite the feeding frenzy beginning to form.  When you have a reporter greet you in Atlanta, not even in Columbia, you realize that the gig is probably up. 

So, I think for him, that‘s not the case.  The problem is, for the Republicans nationally, this was a guy who was truly sort of representing this less government wing of the Republican Party in a very articulately way.  You know?

And so the fact is, the National Republican Party is going to miss his voice.  He was very good at making this argument.  People didn‘t agree with it, but he was very good at it, and you would hear a lot of economic conservatives here in Washington thinking this was their guy.  That this was the guy that was a true believer in this sort of libertarian view, this free market enterprise view of things. 

And now that voice is missing, that voice is gone.  And obviously we‘ve seen a lot of these potential future leaders of the Republican Party go by the wayside just in the last three months.

SCHULTZ:  Now, we know situations like this, obviously, have no boundaries when it comes to—we say a lock on the market on family values.  But Chuck, this is a card that the Republicans have played for a long time. 

Does this change the face and the presentation of the conservatives in this country?  Does this really hamper them in that sense? 

TODD:  Well, I think you may see a—you‘re going to see some social conservatives who just lash out at these leaders in their party, who are upset about this, that will start lashing out at the David Vitters down in Louisiana, John Ensign down in Nevada, and Mark Sanford in South Carolina.  I think that‘s what you‘re going to see. 

I mean, the fact is these group of voters may feel exploited a little bit.  This isn‘t about the hypocrisy on the candidate‘s level, but the grassroots in the social conservative movement that are going to feel a tad exploited.  And that‘s the repair, the damage that‘s being done here.  And that‘s where the National Republican Party is going to have to figure out how to repair that damage with what has been a crucial part of their base for a good two decades. 

SCHULTZ:  Chuck, in South Carolina, is he going to be able to hang on as governor?  I know there‘s a lot of questions at this hour as to, were taxpayer dollars used on this trip?  Have they been used in the past?  I know a lot of reporters are going through the records right now trying to figure that out. 

I would imagine if that were the case—and it‘s a big “if” here at this hour—if that were the case, he wouldn‘t be able to survive as governor.  But let‘s say that he paid for all of this on his own dime.  Do you think he can stay on as governor? 

TODD:  Well, he only has about a year and a half ago.  He was term limited.  He couldn‘t run again anyway.  So I think he is going to try—my assumption is he‘ll try to hang on.  Now, obviously if it turns out this becomes an ethical government taxpayer dollar issue, that‘s a whole other story. 

The other problem he has is he wasn‘t known as somebody who used a lot of diplomacy, even with members of his own party.  Look, we heard the Republican lieutenant governor, very much a down-the-line conservative down there, Andre Bauer, who was a political enemy, if you will, of this governor.  He didn‘t have a lot of allies before this mess and he felt alone on an island many times before this all came out. 

Now it‘s going to be that much more difficult for him.  So he may not

enjoy the governorship over the next year and a half, and he may—it

wouldn‘t surprise me in the next couple of weeks, he looks around and

realizes, look, if you can‘t get anything done, then you might as well walk

away.  But the thing that could keep him from doing it is that he doesn‘t -

as much as the lieutenant governor doesn‘t like him, he doesn‘t like the lieutenant governor, and so he may fight this thing for a while. 

SCHULTZ:  Chuck Todd, appreciate you being on THE ED SHOW tonight. 

Thanks so much.

TODD:  You got it, buddy.

SCHULTZ:  For more, let‘s turn to Republican strategist Todd Harris. 

He was the communication director for McCain‘s 2000 campaign. 

Todd, what do you make of this?  Could Mark Sanford—do you see it in a different light?  Could he rehabilitate himself politically?  And does he have a future? 

What do you think? 

TODD HARRIS, REPUBLICAN STRATEGIST:  I think it would be very, very difficult for him to rehabilitate himself.  You know, I‘m not going to defend Governor Sanford tonight.  I will say, Ed, I‘m a little taken aback by the amount of glee that you seem to have about what is, in essence, a really, really sad story involving a woman who—his wife, who did nothing wrong, and these children who did nothing wrong. 

I think that, you know, Mark Sanford, as far as I‘m co concerned, I wouldn‘t cross the street for him.  As a Republican, I‘m sick and tired of all of these people who are supposed to be our elected leaders and our farm team.  I‘m tired of them letting us down. 

I will say this dirt bag caucus is not a partisan one.  You know, there are not so proud members like Eliot Spitzer, Gavin Newsom, the mayor of San Francisco who‘s front-runner to be the Democratic nominee for governor in California.  A very long list on both sides. 

You know, I think it‘s a sad day for his family, certainly.  As a Republican, I‘m outraged by it, and it‘s a sad day for the country. 

SCHULTZ:  OK, Todd.  I‘ve let you say a lot there, and I appreciate your take on this, but let me very clear.  The Democratic Party has never run around trying to put a lock on the market on family values, or the Democrats that you mentioned that have fallen from grace and had some indiscretions and some problems and, in some cases, broken the law. 

HARRIS:  Well, Ed...

SCHULTZ:  No, no, no.  Wait a minute.  Let me finish.  I‘ll let you finish...

HARRIS:  Eliot Spitzer...

SCHULTZ:  ... here in just a—wait a minute.  I‘ll let you finish in just a moment.

Here is the travesty in all of this—we as Americans do not hold our elected officials to a high level of standard.  We‘re so quick to forgive. 

You know, if you can‘t control yourself, don‘t use taxpayer dollars and get a job and go in and say you want to serve the public, when all you‘re doing is servicing your own desires.  That‘s my problem.  And my problem with the Republican Party is this is has been a strategic move year in and year out to put yourself above the Democrats and the liberals. 

You know, the liberals are the real sinners in this world, and the conservatives, they‘ve got a lock in the market on how just perfect this family value thing is.  So I don‘t take any glee. 

No, I agree.  It‘s a real sense of sadness.  I feel sorry for the wife and the four sons.  I can imagine what they‘re going through tonight.  It‘s very terrible. 

But the fact is, he signed up for this, Todd.  He signed up for this life.  He signed up for this service.  And he needs to step down. 

Should he step down or not? 

HARRIS:  Well, I think he probably should.  But, you know, if you want to talk about hypocrisy, let‘s remember, I mean, this is not a partisan thing, ed.  Eliot Spitzer made a career out of going after prostitution rings in New York. 

SCHULTZ:  He‘s out.  He resigned.  He resigned. 

HARRIS:  He did.  But don‘t make this a partisan—a strictly partisan issue. 

SCHULTZ:  I‘m not making it a partisan issue. 

HARRIS:  You are.

SCHULTZ:  The Democratic Party has never labeled themselves as the big party of family values.  They haven‘t gone around this country and put up family value signs like they defeated Tom Daschle in South Dakota.  You know, the vote values?  What values are we talking about here? 

I mean, this has been an attack artist on the part of the Republican machine for many years, and now it‘s come back to bite them.  And I‘m asking you, should he resign tonight? 

HARRIS:  Well, and I‘ve already answered your question.  I said that I think that he probably should resign. 

You know, the difference being, of course, between what I‘m saying and what you‘re saying, I agree.  I think he‘s a hypocrite.  The difference is that I think this is a sad day, and I think that a lot of liberals think that this is a very happy day, and I think that that‘s fairly despicable. 

SCHULTZ:  No, I don‘t think it‘s a happy day.  I just want to point out the hypocrisy.  You‘re a good sport for coming on. 

Thanks, Todd Harris.  Appreciate your time tonight. 

HARRIS:  Thanks, Ed.

SCHULTZ:  All right.  Coming up, much more on the Sanford bombshell.

You know, if you disagree with me, send me an e-mail.  You know, send me an e-mail, ed@edschultz.com.  I would love to hear from you.  If you think I‘m wrong on this, send me an e-mail.

Plus, the president wants a public option.  Senate Republicans, what do you think they‘re saying?  They‘re saying no.  No big surprise there. 

I want to know if the Democrats are going to stand up and fight.  I‘ll ask the number two senator in the Democratic Caucus when we come back, Dick Durbin, here on THE ED SHOW. 

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  A big development on health care today.  On this network, in case you missed it, Norah O‘Donnell had, I thought, a very interesting interview this morning with Senator Chuck Grassley of Iowa right here on MSNBC. 

The senator actually drew a line in the sand.  He unequivocally stated that there will not be a public option.  Take a look. 

(BEGIN VIDEO CLIP)

SEN. CHARLES GRASSLEY ®, IOWA:  We need to make sure that there‘s no public option.  We could have a co-op as a substitute for that if it isn‘t dominated by Washington and if it follows a traditional co-op plan. 

NORAH O‘DONNELL, MSNBC ANCHOR:  So, Senator, you say no public option in order for it to be bipartisan.  Am I correct? 

GRASSLEY:  Absolutely.  And let me tell you what public option is for your audience --- a government-run health insurance program.  We don‘t need any more government in medicine. 

(END VIDEO CLIP)

SCHULTZ:  Excuse me.  Maybe I should do some bowing to the Republican Party here on THE ED SHOW.  This is the biggest shot across the bow to date. 

Folks, I‘ve been telling you this is going to be a cultural war for the country.  The Republicans are saying that public option is non-negotiable.  They will not agree to it in any form. 

Last night on this program, I asked Linda Douglass, part of the Obama team, when‘s the fight going to start?  Well, folks, guess what?  It‘s here.  And I want you folks watching tonight to grasp exactly what the Iowa senator is saying. 

He wants to give subsidies to low-income families who can‘t afford insurance, which means they are going to cut a check to Blue Cross/Blue Shield for paying for you if you don‘t have insurance.  You know what that is?  Where I come from, that‘s corporate welfare.  It‘s welfare via the insurance industry. 

The pockets of the insurance industry keep just filling on up.  That‘s not reform. 

Grassley says this is supporting the private sector.  You know what I call it?  I call it a government shakedown at the office.  That‘s what that is. 

President Obama—Barack, me and you, buddy—you can‘t cave in on this.  The public is with you. 

If the president caves in on this—and I‘ll say it, mark my words—if the president caves in on this, he will be a one-term president, because all of those folks out there that spent $25 and $40 and $50 that have never been in the political process before, that believed in change and believed in hope, they‘re going to fall by the wayside.  They‘re just going to—well, you know, he talked about this public option thing and didn‘t get it done. 

The unions in this country are on fire for this.  Basically what is happening here is that you‘ve got 40 people who are running the damn country and the issue.  They‘re going to block this at all costs. 

This will not happen under any circumstances according to the Republicans.  That‘s basically what they‘re saying. 

Now, the Republicans have drawn the line in the sand, and I think we, as progressives, as Americans—you know, hey, I‘m a 72 percenter.  Here‘s my line in the sand. 

Joining me now for more on this is Illinois Senator Dick Durbin. 

Here‘s the majority whip and the number two Democrat in the Senate.

Dick, how does this sound bite by your colleague, Chuck Grassley, how does this ring your ears tonight? 

SEN. DICK DURBIN (D-IL), MAJORITY WHIP:  Well, I can tell you that the recent polling across America, they just asked the American people, what do you think?  Should there be a public option like Medicare available when you make your choice between private health insurance companies and what our family needs?  It turns out almost three to one people said yes. 

And when you ask Republicans, it was 50 percent yes, 35 percent no. 

Among Independents, very strong support.  Democrats obviously support it. 

And I don‘t hear Senator Grassley and others saying there‘s something fundamentally wrong with Medicare, or the Veterans Administration helping our veterans, or Medicaid helping the poor people in America.  These are programs that we trust, that work, and I think there needs to be some honesty and competition when it comes to insurance. 

SCHULTZ:  Well, are the Democrats going to push back on this and say, Mr. Grassley, we‘re wiping out your line in the sand, there will be a public option, let‘s have a fight? 

DURBIN:  Well, let‘s make sure we get to the right number here. 

We need 60 votes in the United States Senate to make sure that we move forward on health care reform.  We have two senators who are out, Senator Byrd and Senator Kennedy.  And so we are definitely going to need Republican support, a bipartisan approach to this.

We have to find a way to bring Republican support across the aisle to join us.  And I hope we bring many members to do that.  But we‘ve got to sit down and be willing to compromise.  I just hope we don‘t compromise to the point where people across America say this isn‘t really reform. 

SCHULTZ:  Senator, I have to ask you, are you telling our audience tonight that Senator Kennedy and Senator Byrd cannot vote? 

DURBIN:  I can tell you that at this moment, if it were called today for a vote, neither of them would be here.  I hope that when the time comes in the weeks ahead, that they‘re both able to return, but as the whip, I have to count to 60 votes on a daily basis for Senator Harry Reid, and that‘s the challenge we face. 

SCHULTZ:  Well, Senator, why not get every Democrat on board and then make the Republicans filibuster, and then let‘s just run to the next election and clean house?  Because there‘s 38 races coming up.  What‘s wrong with that plan?  We can suck it up for another year. 

DURBIN:  Well, at the end of the day, Ed, we want to pass a bill that

really makes things better across America.  The people feel overwhelmingly

85 percent of the American people say do health care reform, do something about costs, making sure that we don‘t have costs running out of control.  Do something about health insurance companies that are denying coverage on pre-existing conditions.  Make sure that we maintain the right to choose your own doctor, that you have a confidential relationship between doctor and patient.  And so something about 47 million Americans with no health insurance. 

At the end of the day, I want to make sure we get something done.  I think we can. 

SCHULTZ:  Senator, good to have you on with us tonight.  We‘ll do it again.

Thank you.

DURBIN:  Thanks, Ed.

SCHULTZ:  Dick Durbin from Illinois, with us here on THE ED SHOW.

Now, joining me now from the Republican side is Senator John Barrasso. 

Senator Barrasso, thanks for your time tonight. 

You know, I have to give the Republicans credit.  When you draw a line in the sand, at least you know where it is and you don‘t cross that line.  And I think that the Republicans have done a good job of intimidating the Democrats on this issue, if I‘m not too critical on my friends over on the Democratic side. 

But let me ask you this, Senator.  I know you‘re going to tell me that you don‘t want to put the government between me and my doctor.  How are you going to get that insurance executive out of the way and reduce costs? 

SEN. JOHN BARRASSO ®, WYOMING:  I don‘t want anyone between a patient and their doctor or anyone, not a government bureaucrat and not an insurance bureaucrat. 

SCHULTZ:  Well, the insurance guy is right now. 

BARRASSO:  Nobody.  Keep them out of there.

Well, as a doctor who has practiced medicine for 25 years, I fought with insurance agents and bureaucrats, as well as government people.  But Medicare is not what you make it out to be.  It is the biggest deadbeat in the country in terms of paying.  That‘s why the costs for other people is up so high, because of the cost shifting. 

But we are sitting down in a bipartisan way, Ed.  Sixteen of us yesterday, eight Republican senators, eight Democrat senators, saying we need a bipartisan solution to get the cost of care down for all Americans. 

SCHULTZ:  OK.  Do you...

BARRASSO:  And yes, we want to cover those that don‘t have insurance, but what we need to do is get the cost of care down for everyone.

SCHULTZ:  OK.  Senator, do you agree with Senator Grassley that there‘s no way the Republicans will go along with a Republican option? 

BARRASSO:  Not as I see it listed right now, which is to me a government takeover of medicine in this country.  I want to give people more choice, I want to get the costs down, and I want to do it in a way without a government takeover.

SCHULTZ:  It‘s not a government takeover, but we could go for hours on this discussion. 

BARRASSO:  We could.

SCHULTZ:  The point being here is that you‘re willing to go against 72 percent of the American people.  Is that correct? 

BARRASSO:  Well, even Senator Feinstein, a Democrat from California, said she didn‘t think that the president had the votes.  And I looked at that poll and I‘m not convinced that that‘s what it really says, because what I see is, 2 to 1, Americans are saying that the president doesn‘t have a firm plan to handle this large deficit. 

SCHULTZ:  But Senator...

BARRASSO:  Well, you took the poll, and now the Congressional Budget Office came out and said, hey, look, we‘re going to have to spend $1 trillion.  It‘s only going to cover 16 million of the 46 million without insurance.  And it‘s going to do what the president said he didn‘t want it to do.  It‘s going to force people who have current insurance to lose their insurance, Ed.  So look at that.

SCHULTZ:  Senator, that is not a final report.  That‘s a preliminary report.  We‘ve spent $1 trillion on Iraq, and that didn‘t seem to bother anybody over on the conservative side. 

BARRASSO:  The reason it‘s a preliminary report, Ed, is because it doesn‘t even include this government option.  The big parts of the Kennedy bill haven‘t even been scored.  This is going to be $2.3 trillion, maybe $3 trillion over the 10-year plan once it‘s mature program.  So this is not what the Americans...

SCHULTZ:  But Senator, there‘s a majority of Americans who are willing to have their taxes increase to make sure this gets done.  It‘s going to be a job creator, you‘re going to get everybody covered.  People are going to be able to be sick and die in dignity and have some coverage. 

Right now, you‘ve got a private industry that‘s running over the middle class, running over business.  It‘s taking over our economy, and your party is saying you‘re against a public option. 

BARRASSO:  How much are you going to have to increase it?  How much are you going to have to increase their taxes? 

I mean, you‘re saying people want to have tax increases.  I don‘t think they have a full understanding, because we haven‘t heard yet from the Congressional Budget Office how much everyone‘s taxes are going to have to go up. 

I think a government-run plan is the worst thing that could happen...

SCHULTZ:  All right.

BARRASSO:  ... because soon it would be the only plan that we have in the country.  And the people of Wyoming say they realize this is the wrong way to go. 

SCHULTZ:  Well, there‘s I think 68,000 people in Wyoming that are on the government plan, and I don‘t think you get 68,000 calls to your office every day saying it‘s no good. 

Senator, you‘re a good sport for coming on.  Thanks so much.

BARRASSO:  Thank you, Ed.  It‘s always a pleasure.

SCHULTZ:  I give the Republicans credit.  You know, when they let that concrete—you know, when they get their feet in concrete and it dries, they don‘t even try to get out.  They just stay right there. 

All right.  Next up on THE ED SHOW, “Psycho Talk.”  Stay with us.

Michael Savage is giving us entertainment tonight.  It is “Psycho Talk.” 

(COMMERCIAL BREAK)

SCHULTZ:  Oh yes.  Tonight, here on MSNBC, THE ED SHOW, it‘s “Psycho Talk” on steroids, right wing radio talk show host Michael Savage.  Quick reminder about this guy; remember back in May, the United Kingdom banned Savage from the country because they said he fostered extremism and hatred.  Yesterday on his show, during one of his usual tirades, Savage veered off into the attack mode and went after media watchdog Media Matters. Listen.

(BEGIN VIDEO CLIP

MICHAEL SAVAGE, RADIO TALK SHOW HOST:  I am calling upon all people in the media who have been harassed by this Stalinist group, Media Matters, to join forces and publish the names of the people in Media Matters and put their pictures up on their websites. 

In the next few weeks, you can expect me on MichaelSavage.com to give you full pictures and other pertinent information about the individuals who are conducting a campaign against Michael Savage and other conservatives in the media. 

(END VIDEO CLIP

SCHULTZ:  Let‘s put him into the Department of Homeland Security.  That sounds like a threat to me, folks.  Here‘s my question: what does Savage expect his followers—not listeners—what does he expect his followers to do when they see these pictures.  What does he want them to do with that personal information? 

Remember that Homeland Security report warning about right wing extremism?  Savage is pinning a wanted sign on employees at Media Matters.  It‘s really wrong.  It‘s not only dangerous, but it‘s threatening and it‘s really psycho talk. 

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SANFORD:  Bottom line is this: I‘ve been unfaithful to my wife.  I developed a relationship with a—what started as a dear, dear friend from Argentina.  I hurt her.  I hurt you all.  I hurt my boys.  I hurt friends like Tom Davis.  I hurt a lot of different folks.  And all I can say is I apologize. 

(END VIDEO CLIP)

SCHULTZ:  Welcome back.  That was South Carolina Governor Mark Sanford today.  It took him a while, but today Sanford fessed up.  He explained his six-day disappearance, and admitted to carrying on an extramarital affair with a woman from Argentina.  Mark Sanford called himself, quote, a bottom line kind of guy. 

It looks to me the best of the bottom line was on the wrong side of the ledger.  This is not good for him.  It‘s not good for the state of South Carolina.  It‘s not good for the taxpayers. 

Joining me now for more on this is Mike Allen, chief White House correspondent for “Politico.”  Mike, your perspective on this tonight.  How, if any, does this damage the GOP and their image? 

MIKE ALLEN, “POLITICO”:  Well, of course, it‘s another embarrassment, another fiasco, just at a time when Republicans thought they might be getting their footing a little bit. 

But let‘s stop there, and talk about Governor Sanford for a minute.  I think he may wind up resigning.  This is South Carolina.  This is not going to play.  This is not David Paterson in New York.  That‘s a big part of what‘s going to play out here.

It‘s getting messier now.  Tonight, the state newspaper posted e-mails between the governor and this woman.  A very interesting revelation on the Twitter feed of John O‘Connor, the reporter for the state.  He says they‘ve had these e-mails for some time, and that‘s why they‘ve been able to be ahead on this story.  That‘s why McClatchy newspapers, which owns the State, was able to get a photo of the Buenos Aires apartment where this woman lives.  That‘s why they knew what gate to go to at Atlanta Airport earlier today. 

And these e-mails are incredible.  In one e-mail to his mistress, he talks about the curve of your hips, your magnificent tan lines.  He says—he talks about her holding herself, or at least two prominent parts of herself. 

SCHULTZ:  All right, Mike.  OK.  This is not “Dr. Phil.”  This is THE ED SHOW.  But I got to ask you, why did they hold the information?  If they knew this was going on, why did this newspaper organization—I think you said McClatchy newspapers—why didn‘t they report it when they knew it?  They played some gotcha here, or what?

ALLEN:  No, as always, you get to the heart of it.  I think that‘s something that‘s going to be asked.  It will be a good media story.  Clearly, they wanted to nail it down.  They wanted to know exactly what was going on.  But they were able to—by using this information, they were able to leverage it into getting the embarrassing messy confession that the governor made today. 

What a disaster.  In every way, he showed that there was no survival plan here.  The fact that he went out there without his wife.  That‘s disastrous in South Carolina.  That shows you that they‘re nowhere near patching this up.  And it‘s going to be—it‘s going to unwind in a hurry, I think. 

SCHULTZ:  Well, it was interesting watching this unfold.  And, of course, the cynics are out there watching some of the video from the press conference.  Maybe there‘s some people in South Carolina glad that this thing is going to finally come to an end.  There was one lady that was standing behind the governor when he was talking here, in the bottom left hand side of the screen.  She‘s—she‘s kind of smiling a bit.  What do you make of this? 

ALLEN:  As an example of what a fiasco this is, the governor, afterwards, had to put out a written follow-up clarification statement, making explicitly clear that it was not his staff that lied here, that he misled the staff.  As you know, during this very defensive, unhumble, poorly thought out news conference, he left the impression that maybe the staff had something to blame here.  Clearly, somebody said to him, we‘re not taking the fall for this and he put out that statement of clarification.  What a mess. 

SCHULTZ:  Mike, great to have you with us tonight.  Thanks so much. 

Great reporter. 

ALLEN:  Watch the moonlight, dude. 

SCHULTZ:  All right, I will.  For more, let‘s bring in our political panel tonight.  Nationally syndicated talk show host Bill Press is with us tonight.  Sam Stein, political reporter for the “Huffington Post” and Michael Graham, talk show host on WTKK in Boston, has South Carolina ties.

I‘ll ask you first tonight, Michael, what did you think when you saw this story unfold today? 

MICHAEL GRAHAM, RADIO TALK SHOW HOST:  It is one of the most amazing messy things I‘ve ever seen.  In full disclosure, I used to run political campaigns in South Carolina for six years.  I‘ve known Mark Sanford since 1993.  And of all the people I knew, the last political person I could imagine in that kind of confused, lost mess is Mark Sanford.  He‘s always been cool. 

You know, he‘s a Cato Institute Republican.  He‘s not a—although he is socially conservative as a guy, that‘s not his big play.  He‘s like Steve Forbes, with class and charm.  He‘s always been cool.

This guy today, what I saw out there—I watched it.  I‘m like Will Folks, his spokesperson, who said, just afterwards, my jaw was on the floor.  This guy is just lost. 

I have one thing that Mike Allen said though about the humble part; he looked crushed.  He looked like he was watching his life wash away.  It was hard to watch, after seeing the guy at his best. 

SCHULTZ:  Bill Press, you probably won‘t have too much show prep tomorrow.  You have enough material here? 

BILL PRESS, RADIO TALK SHOW HOST:  Three hours.  You want me to give the telephone now.  Ed, look, I want to say something you couldn‘t say earlier.  I‘m gleeful tonight.  And I‘ll tell you why, because another Republican hypocrite bites the dust.  This is a party that has gone around for 30 years pretending that they‘re up on a pedestal.  You know, democrats have no moral values.  They‘re the party of god and guns and everything else. 

And now they show, you know, look at the Republican party, right?  David Vitter, Jon Ensign, Larry Craig, go down the list.  And the latest, Mark Sanford.  So I think they‘re no longer the party of small government.  They‘re no longer the party of fiscal responsibility.  And they‘re certainly no longer the party of family values. 

SCHULTZ:  Sam Stein, “Huffington Post,” often times when stories like this break, there‘s always more.  What if he used taxpayer dollars to do this?  This is hypothetical.  This is speculation.  I know there‘s people checking this thing out tonight.  What if that is the case? 

SAM STEIN, “HUFFINGTON POST”:  It just adds another element to it, probably an even worse one.  I‘m not going to get as detailed as Mike Allen did.  The thing I‘ll say is, you know, Mark Sanford, the handling of this whole process is, in itself, problematic for any future political run.  The executive leadership he showed in confessing to his sins and staging that awkward press conference was really bad. 

Then I‘d say this also, for the Republican party, they were depending on their gubernatorial ranks.  That was the cream of the crop.  And what we see know is Sanford fall.  Pawlenty is hindered by what‘s going on with Al Franken.  Rick Perry is talking about secession.  Sarah Palin has her dramas.  And Bobby Jindal gave a very awkward to President Obama‘s State of the Union.

One by one, they sort of eliminated themselves from the running.  You have to wonder. 

SCHULTZ:  With all these things, at least they‘re going to hang their hat on the fact that they got a line in the sand for health care.  Damn it, we‘re not going to get that done.  That‘s about where they are.  Gentlemen, stay with us.  We‘re coming back with a lot more. 

Coming up, I want to know if President Obama is going to take on the Republicans.  I mean, I want him to fight hard for public option.  The president met with a group of governors about health care today.  I‘ll talk to one of them from Wisconsin, Governor Jim Doyle, when we come back here on my playbook.  Stay with us. 

(COMMERCIAL BREAK)

SCHULTZ:  In my playbook tonight, Democrats, I‘ve heard you.  We gave Democrats control of the Congress.  We put President Obama in the White House.  And we‘re hearing from the Republicans right now.  They‘ve only got 40 in the Senate, right. 

But they are really coming to a point where they‘re saying, we‘re just going to intimidate the Democrats.  We‘re going to really hit it to these so-called centrist Democrats.  We‘re going to shake them up so bad.

But let me tell you something: I do health care every night on this program for one segment until we get conclusion here.  I want you to know, as a viewer of MSNBC THE ED SHOW, that at some time during the show I will do something on health care every night, because that‘s how passionate I am about this. 

Today, President Obama brought five governors to the White House to talk about health care.  Joining me now is Wisconsin Governor Jim Doyle.  He was in the meeting today.  Governor, good to have you with us tonight. 

GOV. JIM DOYLE (D), WISCONSIN:  Thank you, Ed.  Good to be here.

SCHULTZ:  Is this is crisis in your state? 

DOYLE:  Well, it is, although we‘ve been very successful.  After Massachusetts, we have the second most—highest percentage of citizens covered.  And we have built out some very significant health care programs.  For example, just last week, we commenced a program that will reach single adults without children, but who are working, but don‘t earn enough wages to pay for health insurance. 

And just to give you a sense of it, we had 11,000 people sign up for that in the first week, to show you the demand and need of people in this country. 

SCHULTZ:  Is the president committed to a public option, based on the meeting you had with him today? 

DOYLE:  I think he very clearly is.  He made a very strong case about public option.  President Obama is a very practical person.  It‘s one of the reasons I think he‘s a great president.  And he sees the public option in very practical terms about how do you create real competition.  And he made a very strong case for us. 

SCHULTZ:  Senator Grassley, maybe not being so practical, being very demanding, and flat-out saying that they‘ve drawn a line in the sand, that there‘s no way they‘re going to pass a bipartisan bill with a public option.  What‘s the president‘s response to that? 

DOYLE:  I think if he believes, as he does, that the public option is necessary to help drive down the cost of health insurance for people, he‘s going to move forward.  And, you know, when they say we‘re going to withhold bipartisan, they did that with the stimulus package, but a couple of Republicans came over, thank God.  And as a result, states like Wisconsin, we‘re putting people back to work and we‘re funding health care and education. 

SCHULTZ:  About that, is the stimulus package working in your state? 

DOYLE:  Absolutely.  In the first place, I don‘t know what we‘d be doing without it.  If we didn‘t have it, we would be cutting education and health care.  We‘re now putting tens of thousands of people to work. 

SCHULTZ:  Finally, on a lighter note, how do you feel about Brett Favre going to the Vikings? 

DOYLE:  It‘s painful, but we‘ve got a great new quarterback in Aaron Rodgers.  And the Packers are going to be great this year. 

SCHULTZ:  Governor Doyle, thanks for joining us tonight on THE ED

SHOW.

Coming up, the dismal state of the GOP; our panel takes on the cheating governor from South Carolina.  Plus, last night on this show, a GOP lawmaker blamed President Obama for a woman being killed in Iran.  Keep it up, Republicans.  Take it all the way to 2012.  That‘s next on THE ED SHOW.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  The GOP is really having a little trouble with its 2012 heavyweights.  Mark Sanford disappears.  It turns out he‘s in Argentina with a woman who is not his wife.  Jon Ensign sleeps with a staffer, puts her son on the party payroll and then fires her.  Sarah Palin pays back thousands in free-bee travel for the kids she‘s using to seize the limelight. 

Bobby Jindal disappears of the national stage after flopping in his prime time debut.  It seems like every time we turn around, it‘s another one bites the dust.  Time to bring in our political panel, Bill Press, Sam Stein and Michael Graham.

Michael, we‘ll give it to you first tonight again.  If you had to support somebody as the leader of the Republican party, and your best candidate for 2012, who is it? 

GRAHAM:  To be announced.  Can I pick that?  I have never heard a political conversation ever in which Senator Ensign of Nevada was described as a heavyweight in the 2012 presidential race.  Not even Mark Sanford, who I happen to know somewhat.  I asked him a dozen times, are you going to run for president?  He was always very standoffish about it.  I don‘t think he was ever electable or nominated, because he‘s the closest thing to a Libertarian that the Republican party has. 

Here‘s what‘s interesting, Sanford‘s position is so bad that what

happened today was actually, I think, the better outcome.  I would like to

know what Sam Stein and Bill Press think.  If the outcome had been that he

just went to Argentina because he just decided he wanted to go to Argentina

I mean, you don‘t want to be a cook.  It‘s one thing to be a cad.  The mess that will kill him today—and I really think this ending his political career—is the cluelessness, the messiness of it.  This guy clearly is not all there, all of a sudden. 

SCHULTZ:  Bill what do you think?

PRESS:  Well, cook or cad doesn‘t make any difference.  The guy is out of the running.  I have to tell you, Sam said it earlier, when you have to choose between Sarah Palin, Bobby Jindal and Rick Perry and Mark Sanford, it‘s really tough. 

Ed, I think we‘re going to have to go with a giant of moral rectitude. 

Newt Gingrich. 

SCHULTZ:  Let‘s get to a tougher subject.  Here we go to Iran.  Last night on this program, Congressman Dana Rohrabacher blamed the president for the violence in Iran.  Here it is.

(BEGIN VIDEO CLIP)

REP. DANA ROHRABACHER ®, HOUSE FOREIGN AFFAIRS CMTE:  If he would have been talking even a little bit tougher a few days ago, we might not have been seeing the violence and bloodshed of this repressive regime in Tehran in the last two days. 

SCHULTZ:  You—Congressman, let me get this straight.  You‘re saying that if President Obama had talked tougher, there wouldn‘t have been death in the streets in Iran? 

ROHRABACHER:  Let me tell you something, the North Koreans and the Iranian mullah dictatorship, yes, when the president talks tough with them, they‘re less certain of themselves and less likely to commit these acts of violence. 

(END VIDEO CLIP)

SCHULTZ:  Sam Stein, where do you think the public is on this issue? 

STEIN:  That was a remarkable clip.  We flagged that at the “Huffington Post.”  I mean, one of the defining moments of the election was Barack Obama promising to promote a different type of America to the international world.  And I think that really resonated among the public, who was tired of the belligerence we saw from the Bush years. 

I don‘t know where that came from.  I know that Tom Tancredo were to go on and say he disagreed with that sentiment, John Bolton, too, disagrees with that sentiment.  When you‘re to the right of John Bolton and Tom Tancredo, you know you‘re on the fringe.  I think the public is with Obama on this one.  That was just a little scary. 

SCHULTZ:  All right, there‘s a lot of places around America where some people think the GOP is going overboard.  This is one of them in the state of Maryland.  The president of the Republican Women of Anne Arundel County said this about President Obama: “Obama and Hitler have a great deal in common, in my view.  Obama and Hitler used the Blitzkrieg method to overwhelm their enemies.  Fast carpet bombing intent on destruction.  Hitler‘s Blitzkrieg bombing destroyed many European cities quickly and effectively.  Obama is systematically destroying the American economy and with it, America.” 

Michael Graham, what do you make of this?  Is this overboard or is this fair play? 

GRAHAM:  I defer to no one on the important leadership role that the Republican Women‘s Club of Anne Arundel, Maryland plays in guiding the national conversation. 

SCHULTZ:  It‘s in the national conversation because if this is what‘s happening at the grassroots level, how do we know this isn‘t the kind of stuff that they‘re trying to purport around the country. 

GRAHAM:  You let the national Republican party off the hook for some lady in Anne Arundel county, and I‘ll let the Democrats off the hook for the fact that in 2007 half of them Democrats couldn‘t say for sure that the US wasn‘t involved in the 9/11 conspiracy. 

PRESS:  Ed, this is not just Anne Arundel County.  Look, this is on the national talk show circuit.  I‘ve heard Michael Savage compare Obama to Hitler.  I‘ve hard Mark Levin compare Obama to Hitler.  This stuff is dangerous.  It‘s way over the line.  You can disagree with his policies, but I think we all ought to agree—Michael, you and I ought to agree, the H-word ought to be out of American politics. 

GRAHAM:  Wait a minute, I don‘t want to get involved in some obscure conversation that‘s going on right now in the -- 

PRESS:  It‘s not obscure.  They‘re comparing the American president to Hitler, Michael.  Condemn it. 

GRAHAM:  I‘m sorry.  You heard what she said.  When the U.S. senator from Illinois who was on this show earlier, Dick Durbin, can compare our American soldiers at Guantanamo Bay to Pol Pot and the Nazis, that‘s a problem.  You‘re talking about talk show hosts and some lady in Maryland. 

PRESS:  You know he did not do that. 

SCHULTZ:  Sam Stein, what do you think?

STEIN:  I think that‘s a false comparison.  But there are fringes in both parties.  I don‘t think it‘s fair to say the GOP fully embraces that type of viewpoint.  I do agree with Bill on one sense, that there is that sentiment out there.  It‘s impossible to avoid.  You get it in your e-mail in box every day. 

I don‘t think it defines the GOP.  I think it‘s scary, in and of itself.  But let‘s not make too much out of it. 

SCHULTZ:  Well, it is kind of scary.  This is outrageous.  The liberals didn‘t do this with Bush in office. 

GRAHAM:  Bush/Hitler, are you kidding me?  Bush, Hitler, MoveOn.org.  Are you kidding me?  They were comparing—they were trying to convince us that the program for monitoring e-mails from people linked to terror suspects to America was leading us to a new fascist state.  Are you kidding?  This is a woman talking about the Blitzkrieg.  This was a metaphor.  When the people compared Bush to Hitler, they weren‘t metaphorizing. 

PRESS:  Michael, when you have members of your own party who are really on the fringe, you ought to just say they are nuts.  And those women in Anne Arundel County are nuts.  And so is Michael Savage.  And so is Michael Levin.  So stop defending them.  It‘s an odious comparison. 

SCHULTZ:  Great to have you with us tonight.  Good discussion.  We‘ll have you back for sure.  That‘s the ED SHOW for tonight.  I‘m Ed Schultz.  For more information on THE ED SHOW, go to Ed.MSNBC.com or check out our radio website at WeGotEd.com.  Next town hall meeting‘s going to be in Madison, Wisconsin on July 19th.  Then we‘re off to Portland on the 31st of July at the Baghdad Theater. 

“HARDBALL” with Chris Matthews starts right now, right here on MSNBC.

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

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