updated 7/9/2009 10:18:20 AM ET 2009-07-09T14:18:20

Guests: Carlos Watson, Jay Rockefeller, George Miller, John Nichols, Jeanne Cummings, Laura Flanders, Todd Webster, Frank Donatelli

(BEGIN VIDEOTAPE)

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

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SCHULTZ:  Good evening, Americans. 

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

A day after Al Franken gets sworn in Harry Reid gets tough, telling Max Baucus, quit chasing these Republican votes and just pass a health care bill.  It‘s about time.

Senator Jay Rockefeller, the chairman of the Commerce Committee, is with us tonight.  He has just released a report that shows that the insurance industry is hammering consumers when it comes to overcharging.

A big story coming up in just a moment.

And Sarah Palin says all options are on the table for 2012.  The Republicans are loving that.  She can bring them star power and, as I‘ve said, a bunch of money. 

The conservatives think Michael Jackson could turn mainstream America against the Democrats.  Congresswoman Sheila Jackson Lee is pushing a controversial resolution in the House.  It‘s causing big problems for Nancy Pelosi. 

I‘ll talk to the congresswoman, Jackson Lee, at the bottom of the hour. 

Plus, “Psycho Talk,”  and we‘ve got a great panel coming up tonight.

But first, tonight‘s “OpEd.”

If you‘ve been following the developments as of late, you have to know that there are some mixed messages that are coming from the White House on this public plan.  And there absolutely should be no mixed messages.  Zero, period, none. 

Everybody got that?

Chief of Staff Rahm Emanuel let a comment slip to “The Wall Street Journal” on the public plan.  Here it is: “The goal is to have a means and a mechanism to keep the private insurers honest.  The goal is non-negotiable.  The path is (negotiable).” 

He‘s got to have bipartisanship? 

Now, this does not fit well with some lefties in Congress.  In fact, here‘s the president overseas.  He has to issue a statement to mop this thing up. 

Once again, the president has been consistent.  He says, “I still believe, as I‘ve said before, that one of the best ways to bring down costs, provide more choices, and assure quality is a public option that will force insurance companies to compete and to keep them honest.” 

Now, folks, I don‘t know what you think, but here‘s my take.  This is not Chicago politics.  It‘s just too nice.  And it‘s also confusing. 

The last thing the Obama administration, the Obama White House needs to do is confuse the public on health care.  If the people in Congress are confused, where do you think the public is? 

Harry Reid finally has gotten into the mix.  He collars Max Baucus and says, look, we‘re not going to be taxing anybody on their health care benefits, and stop chasing these Republicans around as if we have to have them to get this deal done. 

Here‘s what‘s happened, folks.  This is a classic.  They‘re hearing your voices. 

These senators went home for a break last week to take a breather; right?  You know what they did?  They got an earful.  They got an earful.

This is what the public wants.  The polls have been showing this for months on end. 

In another development today, the hospitals are going to be good guys.  Here‘s the word of “The Washington Post”—The Hospital Association, they‘re going to contribute $155 billion over the next 10 years to help cover the uninsured? 

Vice President Joe Biden made that announcement today. 

(BEGIN VIDEO CLIP)

JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES:  Hospitals are committing to contributing $155 billion -- $155 billion—in Medicare and Medicaid savings over the 10 years to cover health care cost reform.  Over the next 10 years.  As more people are insured, hospitals will bear less of the financial burden of caring for the uninsured and the underinsured, and will reduce payments to cover those costs in tandem with that reduction. 

Today‘s announcement, I believe, represents the essential role hospitals play in making reform a reality. 

(END VIDEO CLIP)

SCHULTZ:  I‘m an Obama and Biden believe big time, but folks, you have to admit, these dog bones, they‘re just getting bigger all the time, aren‘t they?  You‘ve got three hospital associations cutting a deal with the White House, trying to fight off the public option.  That‘s what this is. 

This is the American people against the establishment, and the deciders are in the middle wondering what the heck is going on.  You‘ve got Rahm Emanuel over here and you‘ve got the president over here.  He‘s overseas and has to issue a statement on where he stands on public option again?  You‘ve got Harry Reid over here, smacking up Max Baucus, saying enough of this stuff, OK, when it comes to taxing benefits. 

The Democrats, they‘ve got to get on the same page.  But here‘s the one constant thing in all of this—you. 

The American people, you have been at the right place all along, and that‘s public plan, that‘s public option.  We‘re not going to get single payer.  That isn‘t going to happen. 

Now, there‘s a new twist tonight that is happening here.  The chairman of the Commerce Committee, Jay Rockefeller, is going to join us here in just a moment.  He has released a blistering report that the insurance industry has been giving underpayments to consumers. 

You are getting butchered by industry, by the industry, the insurance industry.  They‘re not paying what they should be paying. 

The senator from West Virginia joins us tonight. 

Senator, it‘s been too long.  Great to have you with us. 

I know you have been on this for a long time.  Can you tell us exactly what your report is saying about what the insurance industry is doing to consumers in this country?

SEN. JAY ROCKEFELLER (D), WEST VIRGINIA:  The report shows—and Ed, I‘m going to write you a little note and I‘m going to send it to you if you promise to read it. 

SCHULTZ:  I promise to read it, Senator. 

ROCKEFELLER:  It‘s brilliant, and it shows that the insurance industry is controlled—there‘s a conspiracy of making sure that their profits increase.  And the way they do that is by increasing the amount of co-payments that patients have to pay and decreasing the amount of money that providers of health care get.  So it‘s a scam. 

SCHULTZ:  OK, it‘s a scam.  Those are strong words. 

What happens when a patient goes out of network?  Is this where the insurance industry is really nailing consumers? 

ROCKEFELLER:  That‘s where they are, but that happens to be about 100 million people. 

It‘s interesting, actually. We got the head of the biggest insurance company involved in all of this.  And they settled in New York for $350 million because they were being accused of just what you are saying and what I‘m saying and what this report says. 

And I said, “Well, did you just settle for $350 million or were you afraid hat you were going to get hit with a fraud indictment?”  And they said, “No, we thought we would like to do something positive.”

SCHULTZ:  Senator Rockefeller, how could this—this is breaking news.  How could this change the landscape of the debate in Washington for competition for the insurance industry?  Do you think that this report could bring some conservative Democrats over to a better line of thinking when it comes to a public option, what the president wants? 

ROCKEFELLER:  I think it mixes in beautifully with the public option because, in fact, I‘ve been for that from the very beginning just like you have.  I put the first bill in, and it‘s the only really—what I call a pure bill. 

And the main thing I want people not to be scared of is these people trying to scare them saying this is the first step to socialism, this single payer, you know, government runs often (ph).  It is a public option.  If people like the health insurance they have, they can keep it.  If they want to pay a little bit more for the health, they can do that.  But the point is, the public option forces competition with the insurance industry, which is going to have to bring down their costs or else they‘re going to go out of business. 

SCHULTZ:  And finally, Senator, tell us about this $155 billion over the next 10 years that these three hospital associations have decided to pony up to cover those who are uninsured. 

Do you think this is a credible offer?  And do you think it can work? 

ROCKEFELLER:  Ed, I‘ve been working on health care for about 35 years.  And I‘ve heard a whole lot of statements from a whole lot of people saying how they were going to help.  And this is always before they actually have to help. 

So I‘m really proud of the Obama administration and Vice President Biden, you know, for getting this so-called agreement.  But I‘m really much more interested in what happens to the consumer, to the health care consumer. 

SCHULTZ:  What about Harry Reid, the Senate majority leader, telling Max Baucus that we are not going to be taxing health care benefits?  This seems to be kind of coming late in the conversation.  I mean, they‘ve been talking about that for months. 

What‘s your response to that conversation? 

ROCKEFELLER:  Ed, look, does taxing health care and people who have health care, use health care, strike you as the most brilliant way to solve our health care problems? 

SCHULTZ:  Well, it‘s one way to—I mean, I don‘t like going after people‘s income.  That‘s what I don‘t like.  I think there‘s other ways to generate the money. 

ROCKEFELLER:  Taxing people‘s health care, that‘s what‘s being suggested, you see.  And that‘s what this debate is all about with Harry Reid and Max Baucus and the rest of them. 

It‘s not going to be on the table as far as I‘m concerned.  You don‘t suddenly tax what people are paying for health care.  You just don‘t do it.  I mean, look, you can come from all different kinds of circumstances, from all kinds of places all over America, but you don‘t tax health care to pay for health care. 

SCHULTZ:  Senator, you and I have always had a good back-and-forth on the issues.  Just have some fun.  If you have any other questions you would like me to answer tonight, I would certain to go along with you on this. 

ROCKEFELLER:  Well, we will have gotten to MedPAC one of these days.  I‘ve got a way to solve all those problems, too.  You know, reimbursement of providers and making it fair, and getting the lobbyists out of the picture. 

Can you imagine health care going through Congress without the impact of lobbyists? 

SCHULTZ:  Absolutely. 

Senator, great to have you with us tonight.  And great job on that report.  I think it is—it is big news because it really undresses what the industry has been doing to consumers for a long time.. 

Thanks so much, Senator. 

All right.  Joining me coming up in just a moment is going to be George Miller.  And he, of course, is on the House Education Labor Committee.  They, over on the House side, have not really had too many problems when it comes to going after the public option.  It seems pretty determined that the House bill that comes out is going to have the public option, and there‘s no question about it that the Democrats are on the same page over on the House side.

It‘s in the Senate where we‘ve got some weak knees going on.

Joining me is George Miller.

Congressman, great to have you with us tonight.

I need some clarification.  I think our viewers tonight want some clarification on exactly, what was Rahm Emanuel talking about when he said that it was negotiable with Republicans when it came to the public option?  And a meeting was called last night abruptly on the Hill.  You were in that meeting.

Describe it for us.

REP. GEORGE MILLER (D), CALIFORNIA:  I was in that meeting, and Rahm Emanuel, the president‘s chief of staff, came and told the Democratic Caucus that President Obama continues to be behind the public option.  He wants a public option in this health care plan, and that‘s what we expect to give him from the House of Representatives, and that‘s what they expect to receive.

We think it‘s absolutely critical that the public option be in the national health care plan, where you just saw one reason why.  If we do not have a public option, there‘s no way that we can protect American families and rate players from the kinds of schemes that Senator Rockefeller just exposed in his report, a billion dollars, ripping off their policyholders.  And there‘s no way to protect them from that if we do not have a public health option that‘s overwhelmingly supported by the American people.

SCHULTZ:  Congressman, how much fuel is this going to put on the issue of pushing for a public option now that this report is being released tonight? 

MILLER:  Well, this is just another exhibit in a long history of examples that every American family feels every time they go to pay for their medical procedures, to pay for their hospital space, to pay for their surgery.  They find out, well, it really wasn‘t covered the way it was represented in the policy. 

You got the wrong document.  If you had called the home office, maybe you would have known that you‘re going to be liable now for thousands of dollars where you thought you maybe were going to be liable for a couple of hundred of dollars. 

SCHULTZ:  OK.  All right.

Now, this is really a lot of ammunition for the Democrats, and it‘s a lot of ammunition for the Obama White House. 

Is this the time to really hit the throttle and put it to the floorboard for the American people and forget what the Republicans are talking about when it comes to bipartisanship?  In the meantime, you have got the White House kind of sending some mixed messages here. 

Your thoughts on this, really kicking this into overdrive? 

MILLER:  I think, clearly, we‘ve got to kick it into overdrive.  We have met with the Republicans on the three committees in the House.  We‘ve apprised them of the bill.

There‘s no indication that they want to play.  What they want to do is attack the Obama plan.  They don‘t want to offer a health care plan as an alternative.  They simply want to attack this. 

In the Senate, I think what you‘re seeing is there‘s a realization that if you think you‘re going to bring along 10 or 15 or 20 Republicans, you‘re not going to have a national health care plan that really serves the American family.  So I think what you‘re seeing is the Democrats are now starting to understand we‘ve gotten very little from reaching out, trying to do this in a bipartisan fashion.  We‘ve got to get on with fashioning a national health care that can pass the Congress and be signed by the president of the United States and go to the people of this country that so desperately need it. 

SCHULTZ:  Congressman George Miller, great to have you with us tonight.  Thanks so much. 

MILLER:  Thank you.

SCHULTZ:  And Charlie Rangel said that, you know, Rahm Emanuel made one hell of a mistake.  We don‘t need any more mistakes, we don‘t need any miscommunication.  We don‘t need everybody on the wrong page coming out of the White House. 

The American people are with you.  I‘m talking to the White House tonight. 

The American people are with you on public option.  Let‘s get after it and marginalize the Republicans who are doing all these scare tactics about socialism. 

And, of course, we are going to be going to Toronto to find out exactly how well they‘re doing it up there. 

All right.  More news tonight.  The Republicans can‘t wait from Wasilla to come help raise that money.  She‘s fishing for money, I guess.  I told you this was going to happen. 

More from the incredible interview with Andrea Mitchell.  Did Sarah Palin—she did with Sarah Palin. 

Plus, we‘re going to be talking to The Nation‘s John Nichols about her future. 

All that coming up on THE ED SHOW.

Stay with us. 

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.

Only 17 days to go before Sarah Palin I guess you could say bails out as governor of Alaska.

Now, we don‘t know exactly what she‘s going to be doing, but I think she‘s going to be making some serious cash and raising some serious money for the Republicans. 

Now, they‘re hoping that she‘ll bring the fundraising clout to the states and the districts to help the party.  Now, the big question is whether or not she‘s going to shoot for the presidency and the nomination for 2012.  That‘s still up in the air.

Joining me now is John Nichols, Washington correspondent of “The Nation,” who has spent a lot of time in Alaska covering the governor. 

Now, with all this news that has been out there, John, one number that jumps out at me, she‘s not being hurt in the polls.  You‘ve got a “USA Today”/Gallup poll out, Republican vote for Palin in 2012, 72 percent say, yes, we‘re probably going to do that if she goes the distance. 

What do you make of those numbers, John? 

JOHN NICHOLS, WASHINGTON CORRESPONDENT, “THE NATION”:  Ed, in the land of the blind, the nearsighted woman from Wasilla is queen.  The fact is the Republicans do not have a lot of other options.

She is by far their best known and best liked potential contender.  So if she can play out of this exit from the governorship in a smart way, keep her profile up, perhaps write a very strong, appealing book that sells well, she‘s definitely a contender for the 2012 Republican nomination. 

SCHULTZ:  And she‘s going after President Obama. 

I want to play this sound cut from the Andrea Mitchell interview on NBC, which I found very interesting. 

Here she is criticizing the president. 

(BEGIN VIDEO CLIP)

GOV. SARAH PALIN ®, ALASKA:  What has to happen right now is, we need to rein in government.  Obama is growing government.  It‘s the last thing that we need to do right now. 

We need to quit growing this multitrillion-dollar debt that we‘re going to hand on to our children.  And it is immoral and it is uneconomic, the path that he has us on.

I don‘t agree with what he is doing.  And I want to fight with and for people who will usher in the positive change that we need to counter what is going on in Washington, D.C., right now. 

(END VIDEO CLIP)

SCHULTZ:  Uneconomic.  I can‘t—I can‘t find that one in the dictionary, but I guess that‘s an Alaskan word or something. 

NICHOLS:  Ed, don‘t pick on the Alaskans.  That‘s not one of theirs. 

SCHULTZ:  I‘m not.  They‘re a wonderful people.  We did a town hall up there.  You were up there.

NICHOLS:  I sure was.

SCHULTZ:  And there‘s a divided camp in Alaska when it comes to Sarah Palin. 

How is this playing out for Alaskans, in your opinion? 

NICHOLS:  Well, I‘ve been talking to a lot of folks in Alaska.  And one thing to keep conscious of is that she was not particularly popular with a lot of the people in her own party up there. 

She was very likely, if she had decided to seek re-election, to face a primary challenge which would have been a legitimate challenge.  She probably would have won, but she would have had an internal party fight that would have highlighted a lot of the complaints and concerns about her.  That‘s one of the reasons she‘s exiting. 

SCHULTZ:  Yes.

John, what should she be doing? 

NICHOLS:  She needs to take the month of August off.  Nobody is going to be paying all that much attention anyway. 

She should take that time and outline this book, get herself a team of advisers.  She needs to get half-dozen smart national political players around her. 

The fact is that in Alaska, you can run for governor and get elected relatively freelance.  But on the national stage, you need a team, and she doesn‘t have that yet. 

SCHULTZ:  Well, they‘ll get her a team if she can raise the money. 

NICHOLS:  Right.  Oh, she‘ll have the money.  There‘s no question.  She is right now the face of the social conservative pro-life movement within the Republican Party. 

SCHULTZ:  And quickly, John, what is that videotape of her being in waders do?  I mean, I think it plays pretty well with the base.  What do you think? 

NICHOLS:  I think it plays great with the base.  I think it also plays very well, frankly, with a lot of women who like to see a sporty, relatively young woman.  Don‘t see that as a particular negative. 

SCHULTZ:  All right.  Good to have you on. 

NICHOLS:  A pleasure.

SCHULTZ:  John Nichols of “The Nation” does great reporting.

All right.  Next up on THE ED SHOW, “Psycho Talk.”  A Republican senator is afraid President Obama is letting down our nuclear guard against Russia?

Hey, Senator, the Cold War has been over for about 20 years, hasn‘t it? 

Next up in “Psycho Talk.”  

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Oh, welcome back to THE ED SHOW.  It‘s time for “Psycho Talk.” 

Now, this gentleman has been a candidate.  He‘s hit the edit room floor a few times.  But tonight he makes it, Senator Jon Kyl of Arizona.

Here‘s a dandy.  Kyl says President Obama doesn‘t care about protecting the country?  The comment came in an interview on a radio talk show with Bill Bennett.  Kyl was talking about President Obama‘s and Russian President Medvedev‘s agreement to cut American and Russian strategic nuclear arsenal by 25 percent. 

Here‘s what the hard-liner Kyl from Arizona said about the agreement. 

(BEGIN AUDIO CLIP)

SEN. JON KYL ®, ARIZONA:  In the past, our assessment of what we need to protect our interests, as well as the allies that rely on our nuclear umbrella, have put the number of weapons at a certain level.  And the administration is planning to go far below that.  I‘m very concerned that the administration is more anxious to make a deal than it is to ensure the protection of the United States. 

(END AUDIO CLIP)

SCHULTZ:  Wow.

Kyl, you are on an island on this one.  Even right-wingers like the Newtster twittered there is much in the agreement to support. 

Now, a couple of reporters in “Foreign Policy” magazine also reminded us that back in 1986, President Reagan and then-premier Mikhail Gorbachev came very close to agreeing to the complete elimination of nuclear weapons within 10 years. 

Folks, this is serious stuff.

Kyl, I think, is accusing the president of being a traitor.  He says Obama‘s actions are treasonous. 

Saying the president of the United States would sell out to the Russians and make us less safe, that is major league “Psycho Talk.” 

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW on MSNBC.  The Obama administration, I think they should have seen this coming.  Progressives tried to warn them, Paul Krugman, Robert Reich, former labor secretary, tried to warn them.  I‘ve said it a number of times on this program.  The 787 billion dollar stimulus package may not be enough to get the economy out of the ditch. 

Sure enough, five months after the stimulus package passed, the unemployment rate is higher and many states are still strapped.  That‘s the untold story.  Why?  We‘ll get to that.  A new government report says the states are using the stimulus money to pay debts, and just to operate and stay afloat, instead of starting new job-creating projects. 

Now, in the meantime, the party of no is right is there.  They‘ve got no ideas and, of course, they‘re using this opportunity to attack the president of the United States as a tax and spend liberal.  Here it is. 

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER ®, MINORITY LEADER:  We tried to explain to the president that growing government wasn‘t going to get America back to work again, and that by allowing small businesses and American families to keep more of what they earn, they‘re the real engine of economic growth in America. 

REP. MIKE PENCE ®, HOUSE REPUBLICAN CONFERENCE CHAIR:  The only thing the stimulus plan has stimulated is more government and more debt.  House Republicans are determined to continue to advance policy that will get this economy moving. 

(END VIDEO CLIP)

SCHULTZ:  For more on this, let me bring in Jeanne Cummings, assistant managing editor for “Politico.”  Jeanne, good to have you with us tonight.  I see that Vice President Biden is going to head out to Ohio tomorrow, because some of the latest numbers aren‘t the best for the administration.  For instance, The Quinnipiac poll, when it comes to the economic job outlook, the approval rating back in May, the president was sitting at 57 percent approved of the job he was doing on the economy.  Now it‘s down to 46 percent. 

What do you make of this move by the White House to jump on these numbers in Ohio?  Do they view this as a critical turning point to keep people with them?  What do you think? 

JEANNE CUMMINGS, “POLITICO”:  I think they expect there will be some roller coasters.  This is definitely a dip for the White House.  I‘ve been surprised that isn‘t taken them this long to come back hard and respond to the Republican messages that have been coming out this week.  I think the Republicans have gotten the upper hand for now.  As we can see, the White House is taking a more aggressive stance to push back.  They had Rob Nabors up on Capitol Hill today, highlighting different parts of the GAO report, parts that the White House think are good for them. 

And of course, Biden is doing a sort of in your face move by going right out there into Boehner‘s turf. 

SCHULTZ:  Jeanne, it seems to me that the White House has limited options at this point.  The money is being dished out to the states.  The states are using it under the control of the governors.  What can the White House do about creating the jobs they wanted to create with the stimulus money when it‘s being used just to meet state budgets? 

CUMMINGS:  Well, it is something the White House had feared that the money would be diverted in ways that were not as effective in creating jobs.  However, the White House is also stuck in the position where they need to prove a negative.  For instance, many Republicans will concede they saved jobs, not created necessarily, but saved jobs.  And the White House can, through governors‘ messaging, note that there are many jobs in state government that were saved by the fact that there was stimulus money there to hold those jobs in place. 

So it‘s almost like, as I said, proving a negative.  They say jobs not necessarily created.  Now they‘ve got to get to the infrastructure.  That‘s the money they want to start pushing out faster, because that would be the money that could create newer jobs. 

SCHULTZ:  It‘s kind of like baseball, you can‘t deny the numbers.  Your batting just is what it is.  I have said this all along, Michigan, Indiana and Ohio is where the polls are going to slip for the Obama administration if they don‘t start creating some jobs.  What can they do?  And how critical would it be for them if it goes to 10 percent unemployment?  In some of those states it‘s beyond that right now.  What do you think?

CUMMINGS:  It‘s certainly a number that they had wanted desperately to avoid.  We‘re dangerously close to it.  In all likelihood—many economists believe that we will, in fact, hit that mark.  The White House, at that point, will have to have a real messaging problem anew.  Because it‘s a promise or at least a goal that they have set for themselves. 

SCHULTZ:  Do you think the White House will push for a second stimulus package?  There‘s already that talk on the Hill right now.

CUMMINGS:  My instinct is they certainly will not.  I think that the Democrats on the Hill have sent the message back loud and clear that they couldn‘t pass it, even if the White House tried to make a case for it.  I think what we‘ve seen from the White House is that they‘ve turned their attention to how they can get the current stimulus money out faster.  The job creation all along for the infrastructure projects was not supposed to begin until later this year.  If they can expedite that, then they can demonstrate some progress on that front.  It would be much more helpful to them right now than trying to go up to Capitol Hill and, in the midst of health care and energy, try to lay a brand-new project on top of the Democrats. 

SCHULTZ:  Jeanne Cummings, great to have you with us tonight.  Great reporting over at the “Politico.”  You folks do a fabulous job. 

Folks, I want to talk about this for just a moment.  I want to do an I told you so.  Credit is tight.  Money is not cheap.  And until the Obama administration, until the Democrats address this double standard of Wall Street gets it cheap, small businesses don‘t, I don‘t know how you‘re going to get risk takers into the market to stimulate the economy to get this thing going again. 

Mr. Geithner, listen, you got to get to cheap money or small businesses aren‘t going to get into the risk-taking mode.  We‘re just going to be sitting here saying, well, we‘re saving a bunch of jobs.  I tell you, these Republican governors are sitting on this money to run their budgets.  They‘re not fair players.  They‘re not honest brokers with the stimulus package money. 

You check it out, folks.  It‘s there.  They want Obama to fail.  They want this stimulus package to fail. 

All right, a lot more coming up on that subject and other things.  Coming up, one more thing that might get the Congress more riled up in health care reform.  It‘s the BCS, the Bowl Championship Series, near and dear to my heart.  So they can multi-task and we‘ll talk about that when we come back here on THE ED SHOW.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  All right, in my playbook tonight, controversy over the Bowl Championship Series.  Senator Orrin Hatch of Utah held a hearing Tuesday into whether the Bowl Championship Series violates antitrust laws.  After the hearing, Hatch says he thinks the Justice Department should be looking at the BCS? 

Now, I don‘t know about you, but I don‘t want a government bureaucrat in between me and my favorite college football team when they‘re having a great year and going to a bowl game.  Is it all about making sure we know who a championship is?  I‘ll go back to the old days; Woody Hayes, former Ohio State coach, he used to say, I like to have a lot of winners.  I like to have a lot of bowl games that mean a lot.  It sounded something like that. 

Joining me now is MSNBC host and football enthusiast my friend, Carlos Watson.  He also hosts the 11:00 hour here on MSNBC, which I encourage you to watch it, not only because I watch it every day an like it, because he knows what he‘s talking about. 

Don‘t put a government bureaucrat between me and my college football team. 

CARLOS WATSON, MSNBC ANCHOR:  All right.  I‘m going to agree with you, but I‘m going to stand up for Orrin Hatch for a minute.  Are you ready for that?  Hey look, Orrin Hatch is saying there aren‘t really 47 million uninsured people.  He‘s saying the credit card defaults aren‘t going crazy.  He said that 10 million are on the brink of having their homes foreclosed on.  And therefore this is what‘s important.  That‘s what he‘s trying to say.

SCHULTZ:  All right, a serious side of this, is this going to happen?  Are we going to have a playoff series?  It‘s going to take an act of Congress to do this? 

WATSON:  I think we‘ll have a playoff series.  We won‘t have it for four or five years.  Here‘s what Orrin Hatch is saying.  He says that he‘s from Utah.  They were undefeated.  They didn‘t get to go into the series. 

SCHULTZ:  Oh, a little home court stuff going on. 

WATSON:  Remember, his team ended up second.  Florida, which had lost one game, got into the championship series against Oklahoma, who had also lost.  And guess what, Orrin Hatch is saying, you guys aren‘t playing fair.  You locking me in the sand box.  You guys are arrogant. 

SCHULTZ:  That is so homey.  That is so—listen, he‘s a sore loser. 

There‘s a lot going on around in that party.  Go ahead. 

WATSON:  You know what, he‘s the reality—by the way, you had another guy from Texas crying.  Joe Burton held hearings last fall too because guess who didn‘t get in to the BCS championship?  His University of Texas Longhorns, who had a loss. 

But here‘s where they‘re right—here‘s the one thing I‘ll say: there should be a playoff.  College basketball, nothing is more fun than March Madness and the playoffs. 

SCHULTZ:  There is a playoffs.  There‘s a BCS, a computer formula, the schedules. 

WATSON:  Come on. 

SCHULTZ:  Here‘s the big deal; isn‘t it just the major college conferences?  It‘s all for the big guys.  They don‘t want the little guys in there. 

WATSON:  It is, but remember, even some of the big guys get the short end of the stick, right?  Texas got the short end of the stick this year.  You remember all those crazy games they played, including against Texas Tech; Michael Crabtree doing special things. 

Here‘s what I say; President Barack Obama has come out and said we need a playoff.  I say, you know, let‘s get Ed Schultz and Carlos Watson on Capitol Hill saying --  

SCHULTZ:  I guarantee I can do the play by play. 

WATSON:  For 17 years.  People forget that you were a sports director. 

WATSON:  I‘m not that close to it now.  But I‘m surprised that the academic institutions of America can‘t have presidents get together and do what‘s best for college football.  They got to go to Congress? 

WATSON:  I‘ll tell you a little secret here—this is a dirty little secret.  BCS has only been around for ten years in which they use two polls and a computer ranking, six computer rankings, to determine who gets to play for the championship.  But before that, you remember, it was random.  You often didn‘t get the number one and number two team playing. 

SCHULTZ:  All right, what do you got coming up on your show tomorrow?

WATSON:  We‘ve got a great show tomorrow at 11:00 am.  We‘ve got Bernie Sanders, who is coming out firing.  Now remember, independent from Vermont, and he‘s with you.  He‘s saying no more playing around with these Republicans. 

Also going to talk a little Michael Jackson.  Some unexpected new things we‘re talking about. 

And then guess what?  Immigration on the plate. 

SCHULTZ:  All right, Carlos, great to have you on.

WATSON:  Good to be on.

SCHULTZ:  Sarah Palin could be really a cash cow for the Republican party.  GOP leaders are already talking about how much she could help in the midterms.  Frank Donatelli is a GOP money guy.  He runs the GO-PAC.  He and the rest of the panel will weigh in on Palin‘s power and future next on THE ED SHOW.  I wonder if she has a fishing license.  We‘ve got to check that.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  What I‘d say, the real maverick from last year was Sarah Palin.  A new GOP poll shows they love her.  Seven in 10 Republicans say that they would likely vote for Sarah Palin if she ran for president in 2012. 

Let‘s bring on our panel on this one.  Laura Flanders is the author of Blue Grit and the host of GritTV.org.  Todd Webster, Democratic strategist, with us tonight.  And Frank Donatelli is the chairman of GO-PAC.  Frank, let‘s go to you first tonight.  Is Sarah Palin still ready for prime time?  Is she still a major player in your opinion? 

FRANK DONATELLI, CHAIRMAN, GO-PAC:  I think she still is a major player.  Probably not in terms of a candidacy herself, but she has tremendous respect and I think pull within the Republican grass roots.  Heavens knows we need some help.  We‘re in the minority now.  All the big money in America today is with the Obama administration and the unions, which have access to union dues, and the trial lawyers, which give lots of money to Democrats. 

So if Governor Palin can help even up the stakes, I think that‘s a pretty good thing. 

SCHULTZ:  Do you think she resigned, Frank—I‘ll stay with you on this—do you think she resigned because she knows the party is lacking identity, lacking leadership and needs money? 

DONATELLI:  No, I don‘t think so at all.  I mean, she made a personal decision that she didn‘t want to be governor anymore.  I guess there were a lot of ethics complaints against her and she felt like she had had enough. 

SCHULTZ:  Laura, she does one good thing.  She quits a lot.  We‘ve checked on that today.  It‘s a long list here.  What do you think?

LAURA FLANDERS, GRITTV.ORG:  She‘s not going to run on, what, being a mayor of a town of 6,000 and a not quite one-term governor.  I mean, yes, she‘s already getting the, you know, Bailing Palin.  Is that good for a candidate?  I don‘t know. 

But I‘ve been torn on this all day.  You‘ve got your polls, but I‘ve seen other polls today of religious voters.  And guess what, the religious base has a brain.  And you‘ve got three-quarters of them saying they were either, you know, less likely to vote for McCain when he appointed her to run as his running mate or unaffected.  Only about three in 10 saying they might have voted with him more alacrity because he appointed her. 

As a candidate, I think she‘s still doesn‘t appeal to that three quarters of people who say they want a politician to lead for the common good.  They want them to have some experience and not somebody who‘s just about stirring up flames of old battles that we don‘t want to go back to. 

SCHULTZ:  Todd Webster, what do you think?  As a Democratic strategist

you‘ve worked on the Hill for a long time.  Now you‘re off into private business and what not.  Is it good for the Democrats to have Sarah Palin out there using words like uneconomic that aren‘t even in the dictionary?  Is there an upside for Democrats on this? 

TODD WEBSTER, DEMOCRATIC STRATEGIST:  Americans don‘t like a quitter.  What she did—she served half of her term and then bailed out and quit halfway through it, because the going went tough, or she wants to go make money.  That‘s certainly her prerogative.  But if you make a commitment to the people of your state, if you sign up for a four-year contract, I think they would have an expectation that you would fulfill that contract. 

I think there‘s been a lot of attention paid to how loony and how daffy her press conference was, but people have not focused on the scathing indictment that she made of her fellow elected officials, saying that the people basically work half a term, and then they bail out and play golf and eat Bon-Bons and jerk around. 

And that may have been her projecting what her plans were on every other elected official in the country.  That‘s not fair. 

SANDERS:  I don‘t think we want liberals to do the same thing that messed them up a lot in the last election campaign.  It‘s not just about making fun of this woman.  And it‘s not about coming out with just sexist attacks on her.  Does she look great in waders?

WEBSTER:  That is not a sexist attack.

SANDERS:  I‘m not saying that‘s what she said.  When you said her press conference was so wacky—

WEBSTER:  Daffy.  She‘s intellectually—

SANDERS:  George W. Bush‘s press conferences were insane to begin with.  It didn‘t stop him being elected.  The more liberals made fun of him, the more we just turned off a lot of people. 

SCHULTZ:  Frank, I don‘t mean to be mean or sexist or anything right now.  I‘m talking about a candidate.  Does she have the intellectual capacity to be a national candidate for the Republicans at the top of the ticket?  Does she have everything together? 

DONATELLI:  My observation is that she does.  Remember, she was picked on day one.  Two days later, she gave a speech before about five million viewers on cable television.  A week after that, she spoke at the Republican convention to more Americans than Obama did.  She did fine.  And then a month after that, she debated Joe Biden, a 35 year veteran, to 110 million Americans, and she did pretty well.  I think she does have the—

(CROSS TALK)

SANDERS:  Voters said we want somebody with experience who know what they‘re talking about.  There‘s no question. 

(CROSS TALK)

WEBSTER:  Hillary Clinton got pummeled year after year after year and she stuck with it, and she toughed it out and gutted it out, was elected senator and ran for president, and now is the secretary of state.  That is not a sexist comment.  That is a woman who was tough and strong and is a real leader. 

Sarah Palin, who bails after, you know, after half a term, is not. 

SCHULTZ:  All right, now, is the media unfair to Sarah Palin.  There‘s polling on that as well.  Sarah has done a great job over the years of playing the victim.  But right now unfairly negative, 53 percent of the American people believe that she‘s not being treated fairly by the media, unfairly positive nine percent, about the proper treatment and conversation at 28 percent. 

I want to make this observation.  I think the fact that she‘s out fishing with her husband, working hands on with kids, a family thing, it‘s adventurous to do that kind of stuff.  I think that has an appeal to it.  Frank, what are your thoughts on that?  I don‘t think that videotape hurts her at all.  I think it enhances her. 

DONATELLI:  I think the thing most Americans responded to very negatively were the attacks on her children.  You know, the David Letterman comment, the comments about her children.  I think that was—

SCHULTZ:  I don‘t know if that‘s going to get people to vote for her. 

(CROSS TALK)

DONATELLI:  But it make them sympathetic to her. 

SCHULTZ:  Todd, what do you make of her latest videotape out there with Andrea Mitchell of NBC covering her, interviewing her, and she‘s got the waders on.  She‘s the outdoors woman now?  You know what, there‘s a real sense of family to doing this.  And that plays to the base. 

WEBSTER:  I think it‘s great TV.  I think it‘s good for her image.  But it‘s going to be hard to miss her if she doesn‘t go away.  But let‘s not forget, the people who savaged Sarah Palin initially were not Democrats but were the Republicans, were the McCain campaign, who after she left talked about her wardrobe and how she was vapid and how she was half kooky. 

Let‘s place the blame where it belongs.  It was the Republicans who savaged her initially. 

SCHULTZ:  In the final moments here, let‘s switch it to health care for just a moment.  A big announcement today, at least I think it was, by Vice President Joe Biden that the hospitals are going to carve out 155 billion dollars.  The word that they‘re using is contribute.  They‘re going to contribute 155 billion dollars over the next ten years to get health care costs down.  Here‘s the vice president. 

(BEGIN VIDEO CLIP)

JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES:  Hospitals are committing to contributing 155 billion dollars -- 155 billion dollars in Medicare and Medicaid savings over the ten years to cover health care cost reform—over the next ten years. 

(END VIDEO CLIP)

SCHULTZ:  Now, we had Commerce Secretary Jay Rockefeller on here earlier tonight.  He said he‘s heard this kind of smoke before.  Laura, what do you think? 

FLANDERS:  You know, I think that this is one effort to try to get the private hospitals in place, you know, in time to get behind some kind of reform.  But really what‘s being contributed here is not anything concrete.  It‘s savings as they receive fewer federal payments for the uninsured.  This is -- 40 percent of it—stuff that‘s going to be covered by people going insurance under the plan.  It‘s not them giving up profits any place. 

SCHULTZ:  Frank, is this just the big industry working against the public option, and they‘re pulling out all the straws right now?  What do you think? 

DONATELLI:  Well, the administration has certainly put a lot of pressure on private industry to come up with these deal.  But the fact is that, despite all this, government run health care is going to cost over a trillion dollars.  The Congress doesn‘t have any idea how to pay for this.  And that‘s why the government option cannot pass. 

SCHULTZ:  What about that, Todd?  How are you going to pay for it? 

WEBSTER:  Look, I love that nobody talks about how you pay for a war or pay for Iraq.  Look, I think give the administration credit on this.  You keep your friends close, you keep your enemies even closer.  Last week, he gets big pharma looped into this and invested in this.  Today they get the hospitals invested.  These are two of the major groups that could sink health care reform and that killed it 15 years ago. 

So the administration learned lessons from the Clinton folks.  Now there‘s a lot of momentum on Capitol Hill.  You see even Blanche Lincoln, who is one of the conservative Democrats, lining up in favor of the public option.  They‘ve got Al Franken.  They can do this themselves with the 60 votes that they have. 

SCHULTZ:  If they get some guts.  If they listen to the American people, they can get it done. 

All right, finally, it‘s becoming a controversial conversation in America.  The Michael Jackson ceremony, has the media gone overboard?  Let‘s go around the table quickly.  Have we gone too far?  Donny Deutsch on this program last night made some very controversial comments about it.  He thinks that the country is losing its soul and its focus.  What do you think? 

SANDERS:  We talked for weeks about the death of Lady Diana. 

SCHULTZ:  Was there too much coverage? 

SANDERS:  No, not really. 

SCHULTZ:  Frank, what do you think?  Too much coverage? 

DONATELLI:  Celebrity still sells in America.  And yes, there‘s too much coverage.  But that‘s the state of the country today. 

SCHULTZ:  All right.  And Todd, what do you think?  Did the networks go overboard on this? 

WEBSTER:  It‘s Michael Jackson.  It‘s the King of Pop.  He was there -

I remember the “Thriller” album.  I remember the “Thriller” video.  I don‘t have a beef with it.  At least it‘s not JonBenet Ramsey. 

SCHULTZ:  Let me just say that for all the networks, the ratings were through the roof, if that means anything.  I think in our world that does mean an awful lot. 

That‘s THE ED SHOW.  Thanks panel for being here tonight, Laura Frank and also Todd Webster here with us 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.  Our next town hall meeting on the public option is going to be in Madison, Wisconsin on Sunday night, July 19th, from 7:00 to 9:00 at the Barrymore Theater.  Then we‘re going to be in Portland, Oregon, at the Baghdad Theater on July 31st.  We‘re back tomorrow night with THE ED SHOW.  “HARDBALL” starts right now 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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