updated 7/23/2009 10:20:21 AM ET 2009-07-23T14:20:21

HARDBALL

July 22, 2009 - 10 PM

THIS IS A RUSH TRANSCRIPT.

THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

Guests: Savannah Guthrie, Kelly O'Donnell, Dr. Nancy Snyderman, Joan Walsh, Willie Brown, Eugene Robinson, Howard Fineman, Michelle Bernard, Roger Simon

CHRIS MATTHEWS, MSNBC ANCHOR: Night court. Let's play HARDBALL.

Good evening, I'm Chris Matthews in Washington with this special late-night edition of HARDBALL. Leading off tonight, "So what's the verdict?" President Obama, tonight, tried to tackle a problem that has frustrated presidents and Congress for decades: health care reform. But when you go on national television in primetime, you'd better have some answers. You'd better say something. The question is, did the president do that tonight? Did President Obama tell us why we need to change our health care system? Did he tell us what the change would be? Did he tell us how we're supposed to pay for it? It's not clear to me he did any of those things.

Also, the most important moment of the evening may have come at the very end when the president took sides in the arrest of an African-American scholar, Henry Louis Gates. More on that racially charged story in a minutes.

And we'll take another look at the lunatic fringe of the Republican Party that doesn't believe that Barack Obama is actually a U.S. citizen, that he's actually American.

But we begin tonight with health care, of course. NBC White House correspondent Savannah Guthrie joins us now from the White House. NBC's Kelly O'Donnell is at the U.S. Capitol. And in New York, Dr. Nancy Snyderman is with us, she's the most of MSNBC's "Dr. Nancy."

I want to ask Savannah Guthrie, is there a sense, from you all watching this at the White House, that the president laid out a compelling case why we need to change the health care system?

SAVANNAH GUTHRIE, NBC WHITE HOUSE CORRESPONDENT: Well, it's clear that's what the president felt his mission was is tonight, to finally explain to ordinary Americans, frankly, those who do have insurance, why health care reform is a good thing. I think they recognize here that part of the messaging has been a little bit off, it could be a little sharper on that issue, especially when you have all this talk coming out of Capitol Hill about new taxes. People saying what am I going to get out of this?

So, we heard the president talk about what happens, people losing their jobs and then losing their insurance, something that will not be lost on Americans who are living with this terrible unemployment. So, that was a big part of it.

You know, the other part of it is just making clear that health care costs are going up. What he's trying to say is, it's not a choice between no change at all, status quo and this radical change. He's trying to make the case your things are changing, your premiums are going up, health care costs are going out of control and if we don't do anything, things will change all right, they'll change for much, much worse. So, that's the case the president tried to set out tonight.

MATTHEWS: Let's go to Kelly O'Donnell on those questions. Let's start with the big one, did he make a compelling case for change? Again, the same question I put to Savannah-did the president leave the American people with a big message tonight that will reverberate on Capitol Hill, why we need to act now?

KELLY O'DONNELL, NBC CAPITOL HILL CORRESPONDENT: Well, Chris, I think when you look at those key questions, the president offered bits and pieces about all of them, touched on topics, but were they a convincing answer? I think there are some real questions about that.

In making the case, certainly if you're talking about the Capitol Hill perspective, their very steeped in that, here. What struck me is when he was asked more than once about specific things that Americans might not be able to have access to: tests, referrals, those kinds of things, there's often a buzz word that has a negative connotation called "rationing."

But when he was asked twice about would Americans have a change in the kind of services they could get, he was, I think, reluctant to answer that very directly at first. He did come around to it and didn't use the same words as the questioner put to him, but he did say that there would have to be changes, he could not guarantee that there wouldn't be changes and that some of those changes would include choosing things that cost less.

So, that'll be something people want to know more about. Will they have all of the same things that they get now? And it seems the president was hinting and saying probably not.

And on the big question of answering why this is needed, he gave lots of reasons about that relating to the economy, relating to the needs to Americans more broadly. But definitive answers, I think what you noticed here was the president often didn't specifically respond to the question, but he had some key points he wanted to make, especially about the deficit, that he said he inherited those kinds of things.

MATTHEWS: Well, the president kind of said a couple of things, and I think there might be a conflict, here. I went-Dr. Snyderman, you watched this, but he said at the beginning of his remarks tonight, that no one would have the government telling them what they couldn't have in terms of treatment and then later on he seemed to say some things about end of life care and things like that, that suggested things would be different in terms of what you'd be able access as a patient once we get these changes. Here's the president on the question of what sacrifices will have to be made. Let's listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: They're going to have to give up paying for things that don't make them healthier. And I-speaking as an American, I think that's the kind of change you want. Look, if right now hospitals and doctors aren't coordinating enough to have you just take one test when you come in because of an illness, but instead have you take one test and then you do to another specialist, you take a second test, then you go to another specialist, you take a third test and nobody's bothering to send the first test that you took, same test, to the next doctors, you're wasting money.

You may not see it, because if you have health insurance right now, it's being sent to the insurance company, but that's raising your premiums, it's raising everyone's premiums and that money, one way or another, is coming out of your pocket, although we are also subsidizing some of that because there are tax breaks for health care.

(END VIDEO CLIP)

MATTHEWS: Dr. Snyderman, there are people out in the country who have health insurance who are worried, people my age or older, that at some point down the road, somebody from the government's going to say: you're wasting money with that test, don't take it.

My experience with health care is you better get those tests because you don't know you have a problem, like malaria, until you have a couple tests, you find out. Who's to say, you've had enough tests, buster. You're out of here.

DR NANCY SNYDERMAN, MSNBC HOST, "DR NANCY": Well, the doctor should be saying that, and the problem is doctors don't talk to each other, the president is absolutely right about the inefficiencies. And the administration has made a big point talking about the new technology that's going to, sort of electronically link all of us. Boy, that's billions of dollars and years away. So, I think the plain talk, you know, to take the scare out of things like rationing, which basically is what's going on now some people get medicines, some people don't. It didn't come through tonight. As a physician, you know, I felt like I understood the complexity of the problem. As an American citizen, I was rooting for the president to hit a home run. And, frankly, at the end I was afraid that he whiffed on a lot of the things that, frankly, you know, people were looking for more substance than they got.

MATTHEWS: Do you think he answered any of the three questions I put, give me what the compelling reason for change, tell me what the change is and how you're going to pay for it-did he do any of those three?

SNYDERMAN: Not to my satisfaction. And I think the way to have, perhaps, have done it, was to say more plainly, it's hard to see what's around the bend; however, it's like that, you know, that ad we've seen, you pay me now or pay me later. We're going to pay big-time if we don't get this. I do think we're going to be a great world power, I do think this can break the bank. But to say to everyone, you have to step up and everyone has to do a little something, that responsibility message that he's talked about, I didn't hear much about that tonight, either.

MATTHEWS: Well, let's get smart here, as we have been, but let's get smarter, still.

Kelly, I want to ask you this: why the president, who's very, very smart be very, very careful about not laying out what he wants in the bill and how exactly we're going to pay for it? How does this address the three Republican senators he mentioned tonight? Who were they? Grassley...

O'DONNELL: Enzi and Snowe.

MATTHEWS: Enzi and Snowe. How does what he said tonight deal with those people he's trying to get aboard?

O'DONNELL: Well, I think the president kept a lot of doors open by offering praise to those senators, and they are part of the small group that is working to write legislation in the Senate Finance Committee. And everybody's watching that because they will have a lot to say about how this is paid for and there will be the so-called "public option." All the other committees have that. Will finance have that? So, we're all waiting for that.

So, they are key players in getting bipartisan support, so the president gave them a shot-out. He was also critical, more generally, of some other Republicans, but said he wanted good ideas and would use good ideas from Republicans.

I think one of the tougher things, when it comes to the paying for it, the president kept lots of doors open. When the House of Representatives, Speaker Nancy Pelosi, said perhaps there should be a surtax on households that have an income of more than a million dollars a year. The president sort of green-lighted that tonight, by saying that would meet his requirement not to put the tax or the burden for paying for this on middle class families. So, he seemed to be supportive of that without fully embracing it.

And more than once, said, we haven't seen the plan, I haven't heard exactly what's in it. When in reality, he doesn't-none of us know exactly what's in it, but he's talking to these senators and these leaders, directly. They're members of his own party. If he doesn't know what's in it, then nobody does. So, he seemed to be keeping doors open so that whenever something happens, he can either claim responsibility or take part of the credit or perhaps, if it doesn't meet some of his key requirements, he can distance himself.

MATTHEWS: Well, here's the president talking about how to pay for it. He went back to his original idea of several weeks back or several months back, in other words, reduced the deductions you get on charitable contributions and other expenses. Here he is going back to his original idea. Here he is.

(BEGIN VIDEO CLIP)

OBAMA: The remaining one-third is about the argument of what has been of late. What I said is that there may be a number of different ways to raise money. I put forward what I thought the best proposal, which was to limit the deductions, the itemized deductions for the wealthiest Americans. People, like myself, could take the same percentage deduction that middle class families do and that would raise sufficient funds for that final one-third.

(END VIDEO CLIP)

MATTHEWS: Savannah, he's going back to something that was almost drop-kicked within hours of his proposing it. No one in the Congress is willing to go after charitable deductions. You would have every church and synagogue against you, every temple and mosque against you, you'd have every hospital against you, every university against you. Everyone who benefits from charitable contributions, big-time contributions would suffer. Does he really mean that? That he want to pay for health care by going after people who give money to hospitals?

GUTHRIE: Oh, I think he means it and in fact the budget director, Peter Orszag, brought it up again on Sunday on one of the Sunday shows. I mean, they keep resurrecting this idea that, let's face it, as you say, was dead on arrival the minute it landed on Capitol Hill.

So, they like the idea, they think it makes sense. Congress has never gone for it. So, it's a little odd, maybe even a little disingenuous the way that he continually returns to it when asked, well, what are your specific ideas for how to pay for it-he always goes back to this ideas of a charitable deductions, which is, you know, not going anywhere.

I do agree with Kelly that he seemed to signal-he went a little teensy, tiny bit further on this issue of a surtax in the House. That if it were at the level of a millionaire's tax for a family, that he could support it. But look, he keeps avoiding taking a stand on the specific proposals that are on the Hill. And you hear a little grousing, even from Democrats. They're ready now for the president to come in publicly and say I stand for this, I stand for that. They don't want him above the fray, they're-enough with the legislative deference. They want him to show leadership, here.

MATTHEWS: Well, I want Kelly and Dr. Snyderman to respond to that. But first, here he is, the president, saying he might go along with Nancy Pelosi, the speaker's proposal, for taxing people in the very high brackets.

(BEGIN VIDEO CLIP)

OBAMA: We haven't seen a final draft. The House suggested a surcharge on wealthy Americans and my understanding, although I haven't seen the final versions, is that there's been talk about making that basically only apply to families whose joint income is a million dollars. To me, that meets my principle, that it's not being shouldered by families who are already having a tough time.

But I want to do is see what emerges from these committees, continuing to work to find more savings, because I actually think it's possible to fund even more of this process through identifying waste in the system.

(END VIDEO CLIP)

MATTHEWS: You know, the problem with it, Kelly, is it bumps up against another commitment he made I was reminded of today, in the papers, that he promised not to have anyone's tax rates, anyone's, go higher than they were under President Clinton. How does he match that with this-reconcile that with this proposal to add on an extra four or five percent surtax?

O'DONNELL: Well, I think he'll hope that there'll be fewer complaints from the broad American public if you make it a seven figure problem.

(LAUGHTER)

MATTHEWS: Right, right, right.

O'DONNELL: But one of the challenges, I think, for the president to occupy an hour of primetime television coverage, tonight. Now, many Americans are not as seeped in this day-to-day as we are, so we know a lot of the details. But there wasn't that much that really jumped out as being new. In fact, I think the president backed off some. He didn't repeat the, we've got to get it done by August deadline. He talked about the importance of a deadline, but didn't say what it was any longer, allowing for what has been a real push from, especially conservative Democrats, but Republicans too, this idea of slow down.

He seemed to embrace that, to the extent that he said there has to be urgency, but we need to do it right. So, even on the deadline issue, he seemed a bit softer. The only thing he consistently talks about is that he wants no deficit issue and that's been a problem, given some of the assessments of what the numbers look like, and not wanting to put it on the middle class. But if we were looking for a lot more detail, there really wasn't a great deal for us to chew on based on what the president talked about.

MATTHEWS: Dr. Snyderman, how will your fellow physicians react to the statement by the president that some doctors out there will yank your tonsils because they can get a better deal out of it. He didn't say there was incentive to do that, he said doctors actually do that, they engage in surgery where a bottle of pills would be better simply to make an extra buck. I mean, if I were a physician out there, working 60 hours a week, I'd say who's this guy?

SNYDERMAN: Well, let me tell, as someone who used to take out tonsils for a living, I can tell you that the reimbursement isn't even so great for tonsillectomies.

MATTHEWS: Really?

SNYDERMAN: He should have used a better example. Look, most doctors go into medicine for all of the right reasons and the average doctor feels pinched. And I also think the average doctor is willing to give a little.

But what I didn't hear the president say, which is what I was hoping he would say, is that everyone is going to have to step up to the plate. And I have maintained from day-one that if somebody had some skin in the game, across the board, even if it's $10, you have a vested interest in making sure that the system works. And sort of ask one part of the population to shoulder the responsibility for someone else, I'm just not so sure that that's the American way of doing things. And think we're all in or we're not.

And I also think the public is not going to like this rancor on both sides. Most of us live our life somewhere around on the 50 yard line, give or take 10 yards. We don't like it when people on extremes, either way, start rooting for each other's failure. We all have to have something, frankly, we're vested in, here.

MATTHEWS: It's kind of hard to put some skin in the game when somebody says the skin is that liver transplant you're hoping for.

SNYDERMAN: But you know what, that may be the case.

MATTHEWS: Anyway, that is a problem.

SNYDERMAN: That may be the case.

MATTHEWS: And you try selling that to the patient who's waiting for that organ transplants.

SNYDERMAN: But you know what, Chris, we know the organ transplants work for some things, we know the organ transplants don't work for other things. So to just sort of say, you know, because your special number was chosen today, therefore, you're going to have surgery. That's not prudent. So, someone is going to have to talk plain and speak honestly about just that kind of thing.

MATTHEWS: Well, it didn't happen tonight.

SNYDERMAN: No, it did not.

MATTHEWS: Anyway, thank you very much, Savannah Guthrie at the White House, Kelly O'Donnell up on Capitol Hill, where this will be decided, and Dr. Nancy Snyderman, who's in the trade, actually.

You can watch Dr. Nancy's show, by the way, right on television every day here at Noon to see what doctors think, especially our favorite one, Dr. Nancy Snyderman, on MSNBC, of course.

Coming up,- did President Obama step on his own headline tonight, with his comments about the arrest of Harvard professor, Henry Louis Gates. I think he made a headline news story tonight, and I'm not sure he wanted to. And was it smart for him to take sides in a dispute involving the police where he took the professor's side against the police. I've read the police report, it is not-we'll it is not-let's put it this way, consistent with what the president said tonight. So, we're going to have a fight about that. You're watching HARDBALL only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. Tonight's press conference was largely about health care, but President Obama threatened to step on his owned headlines, I guess, as a leader with his answer to the last question of the night about the arrest of Harvard professor, Henry Louis Gates.

Eugene Robinson is a Pulitzer Prize winning columnist with "The Washington Post," and Howard Fineman is with "Newsweek." Both are MSNBC political analysts.

Gentlemen, let's watch President Obama answer the question about Harvard professor, Henry Louis Gates, who was arrested at his own home, starting with this joke. Let's listen.

(BEGIN VIDEO CLIP)

OBAMA: Well, I should say at the outset that Skip Gates is a friend, so I may be a little biased, here. I don't know all of the facts. What's been reported, though, is that the guy forgot his keys, jimmied his way to get into the house, there was a report called in to the police station that there might be a burglary taking place. So far, so good, right? I mean, if I was trying to jigger-well, I guess this is my house now, so, it probably wouldn't happen. Let's say my old house in Chicago. Here I'd get shot.

But so far, so good.

(END VIDEO CLIP)

MATTHEWS: Well, then the president went on.

(BEGIN VIDEO CLIP)

OBAMA: I don't know, not having been there and not seeing all of the facts, what role race played in that, but I think it's fair to say, No. 1, any of us would be pretty angry. No. 2, that the Cambridge police acted stupidly in arresting somebody when there was already proof that they were in their own home. And No. 3, what I think we know separate and apart from this incident is that there is a long history in this country of African-Americans and Latinos being stopped by law enforcement, disproportionately.

(END VIDEO CLIP)

MATTHEWS: What do we make of this, Gene?

EUGENE ROBINSON, "THE WASHINGTON POST": Well...

MATTHEWS: Is he smart to get into this case in such detail?

ROBINSON: He was-actually not given that a couple of the details were wrong. I mean, he said that he had forgotten the keys, that wasn't the case and he jimmied his way into the door, and in fact, he'd gone around the back. But, I thought he was actually really careful in the way he talked about the case. He said, I don't know what role race plays in it. I, frankly, might have gone further had I been talking about it.

And I thought the points he made about the police having acted stupidly, because I don't think it's in dispute that they did know by the time the arrest was made, they knew they were dealing with a man in his own house. And I think, you know, short of attacking a police officer in your own house, you can be obnoxious even if that indeed is what Gates was. I think that's the allegation.

But, you don't have to bring out tea and cookies for the policeman who's accosting you in your own house. So, I think that was a fair thing to say. And I also think it was certainly fair to bring up the context and, you know, this sort of thing does happen.

MATTHEWS: Howard, I mean, one day, one of the points of the dispute is whether Professor Gates was willing to give his I.D. card over when the police officer asked for it. According to the police officer, he was slow to do so. Now, these are going to be disputed for months on the blogosphere, et cetera, but there you have it...

HOWARD FINEMAN, NEWSWEEK: I can see it now, this is going to become another Rorschach test for us, here. I know Skip Gates. He's widely respected. He's the guy who spent his whole life, now, at Harvard studying the history of race and racism in America, and this thing happened to him. So there's going to be a certain number of people whose hearts and minds are immediately going to flow to Skip Gates.

MATTHEWS: Sure.

FINEMAN: Like the president.

MATTHEWS: Well, that's a start. That means you're friends with the guy.

FINEMAN: Now there are going to be other people who are going to focus on the president saying the Cambridge police acted stupidly and they're going to get your backs up. They're going to say wait a minute, this guy was abusive to the police officer and they're going to connect it up with the firemen in New Haven. I can just see it all playing out...

(CROSSTALK)

ROBINSON: One thing that should be pointed out, first of all, I don't know a lot of people who look less like a burglar or less like a threat. Skip Gates is about 5'6" tall, he weighs about 150 pounds.

FINEMAN: He uses a cane.

ROBINSON: He uses a cane to get around. This is not anyone who is a threat to a burly police officer who has a gun, No. 1.

MATTHEWS: As a former police officer and an Irishmen, I have give a response to say something here that nobody talks about, this woman is standing on the curb, who has made the call, the 911 call. She's waiting on the curb because the police officer asked her to be there. She's pointing in the house as he arrives saying the gay's in there, they guy's in there. So, there's a context, here. It isn't just, you know, being at home while Black or something like that. There's a woman outside saying there's a guy in there that's burglarizing.

ROBINSON: I understand that. Look, there's no problem in that the Cambridge police responded. That's exactly what they should have done.

MATTHEWS: But this point of view was, this guy is burglarizing the house because this woman is...

FINEMAN: No, he's on the porch-the cops on the porch, he's asking this guy inside, who originally they thought maybe was a burglar, OK, who the heck are you? Let's see your I.D. At that point, Gates, I'm guessing, went nuts. He said, I'm standing in my own house, you're out there and you have no right to ask me this, I'm in my own house. So, it was a misunderstanding. But I'll say this, you're the one who was the cop, Chris, I was not. But a good policeman, I think, also knows how to back away from a situation. You have to know the people you're policing. That's the whole idea of being a cop on the beat or being in a town that you know. You know, you can understand why a guy like Skip Gates would get as angry as he obviously did. Now, he was charged with something, the charge was something, sounds like out of the 18th century.

Well, exhibiting loud and tumultuous behavior.

(CROSSTALK)

MATTHEWS: It's easy for us-let me tell you, we weren't there. The professor was obviously indignant that he was being treated like a common fugitive or criminal. Obviously we can-even White people can understand that in contact. We don't have the full context, but the history, obviously.

But, this police officer has this woman outside pointing inside. There was two guys, both tried to break into the house. There they are, they're in there, and this guy is responding to that situation.

Now, here's what he says, and the guy may have an attitude, as well, I don't know, because we're all injecting our own experiences here, Gene and you and I are, too.

ROBINSON: We are.

MATTHEWS: Quote, I love this guy's name, James Crowley, Sergeant James Crowley, he's an officer, official. "There are not many certainties in life, but it is for certain that Sergeant Crowley," speaking of himself in the third person, that's like in a police report, "will not be apologizing." So, he's sticking to his guns, more or less.

ROBINSON: Who's the indigent party, here?

MATTHEWS: Both of these guys are ready to say I'm right, you're wrong, go to hell.

ROBINSON: Look, here's the question, I mean, because this is a racially charged incident. Here's the question, once you have established that this is in fact a man who was in his own house...

MATTHEWS: I agree.

ROBINSON: Do you-why do you then go ahead and put him in the cuffs? Now-and would you that if it were a famous Harvard professor, Larry Summers, as opposed to famous Harvard professor, Skip Gates? That's a question that I think needs to be answered.

FINEMAN: I could see Larry Summers becoming even more indignant.

ROBINSON: Right, but I don't think...

(CROSSTALK)

MATTHEWS: OK, let's-here's the police report and you respond to what you think, your view of what this is. We're all trying to figure this out. This is Crowley's report.

"I made this observation through the glass panel, front door. As I stood in plain view of this man, Professor Gates, later identified as Gates, I asked him if he would step out into the porch and speak with me. He replied, 'No, I will not.' He then demanded to know who I was."

(INAUDIBLE) he was a police officer.

"I told him that I was Sergeant Crowley from the Cambridge Police and that I was investigating a report of a break in progress at the residence. While I was making this statement, Gates opened the front door and exclaimed, 'Why, because I'm a Black man in America?' I then asked Gates if there was anyone else in the residence. While yelling..."

I'm yelling, I'm sorry.

"He accused me that it was none of my business and accused me of being a racist police officer. I assured Gates that I was responding to a citizen's call to the Cambridge Police and that the caller was outside as we spoke. Gates seemed to ignore me and picked up a cordless phone and dialed an unknown phone number."

I love the way he said this.

"As he did so, I radio in Channel One," that the police number, "and then I was off in the residence with someone who appeared to be a resident but wasn't very cooperative. I then overheard Gates asking the person on the other end of the telephone call to 'get the chief and what's the chief's name?' Gates was telling the person on the other end of the call that he was dealing with a racist police officer in his home. Gates then turned to me and told me that I had no idea who I was messing with and that I had not heard the last of it."

"While I was led to believe that Gates was lawfully in the residence, I was quite surprised and confused with the behavior he exhibited toward me. I ask Gates to provide me with photo identification so that I could verify that he resided at that address and so that I could radio my findings into the police station. Gates initially refused, demanding that I show him identification and then did supply me with a Harvard University identification."

(CROSSTALK)

ROBINSON: Well, he was being awfully uppity, wasn't he? He was in his own house and, gee, he didn't react well to being called out of his house by some cop he's never seen. He's just gotten home from a trip, he's in his own house. Somebody comes up to your-to the front of your house, looks in though your plate glass window...

MATTHEWS: I want to know who that person is outside that accused me of burglarizing my house.

(CROSSTALK)

I'd be mad at the person who called the cops on me.

FINEMAN: From the point of view of the cop, he's thinking not only am I dealing with-you used the word uppity, I couldn't and wouldn't, but you did, he's big-timing me, he's calling the chief on me. He's doing the Harvard thing on me. I'm just a Cambridge cop. He's also doing the Harvard thing on me.

MATTHEWS: Not since the days of radio have people done so much without a visual. You have no idea what it was like.

Eugene Robinson-we are calling a baseball game like Ronald Reagan used to do without being there.

ROBINSON: What out being there.

MATTHEWS: Anyway, thank you Gene Robinson. We're getting it off the wire here, ladies and gentlemen. Thank you Gene Robinson, thank you Howard Fineman. And we did it with a civilized manner, I think.

Much more on the president's press conference-back to that thing. that's not as much fun as this-and whether he missed a big opportunity, tonight. This is night court, as I said, we're trying to get the verdict. And by the way, this Sunday, MEET THE PRESS, Secretary of State Hillary Clinton for the full hour. That's going to be a big show.

You're watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Still ahead on HARDBALL, how big a problem does the Republican Party have with this, well, lunatic crowd, the crazies who are convinced that President Obama isn't an American? Can't we agree on something, here?

And did the president miss a big chance tonight to not be able to explain why we need a big health care change? All of that is coming up here on a late-night edition of HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to a special late-night edition of HARDBALL. President Barack Obama has been in office now six months, yet right-wing conspiracy theorists keep questioning his very citizenship. Check out what happened at this town hall meeting that Republican congressman, Mike Castle, had in Delaware.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I want to go back to this January 20, and I want to know why these people ignoring his birth certificate?

(CHEERING)

UNIDENTIFIED FEMALE: He is not an American citizen. He is a citizen of Kenya.

(END VIDEO CLIP)

MATTHEWS: Well, everybody's getting open the zoo bus when it comes to this question. Nutty questions about the president's birth certificate are being fueled by conservative talk show hosts like Rushbo himself and of course some others like Lou Dobbs and the lunatic fringes out there.

We've got some Republican Congress people, nine of them, now, all pushing a measure to require the production of-actually the display of a birth certificate in order to run for president now, which is fine except the message is this guy didn't have one, meaning Barack Obama.

Joan Walsh is editor in chief of "Salon," and Willie Brown, of course, is the great former speaker of the California assembly and former mayor of San Francisco, most recently.

I wanted to start with Joan Walsh, because you wrote an interesting blog about your experience watching the former vice president's daughter, Liz-Liz Cheney, talking about this the other day. Your view of what's going on for here with this push to claim that the president of the United States is not an American.

JOAN WALSH, EDITOR, SALON.COM: Well, I think it's really just despicable, dirty politics, Chris, and I was shocked watching Liz Cheney. She was shown that clip that you just showed and was she asked to separate herself from them and she refused. She went on to say that the problem is that people are really uncomfortable with this president who doesn't seem comfortable defending our country overseas. And she went on and on about it.

I've never have seen our friend, James Carville, speechless. He was, briefly. And then he got back in the game and said, what I deeply believe, which is that she and other reputable people in the Republican Party are using this lunatic fringe, they are playing to it, they're playing to the most dirty, disgusting elements of American politics for their own reason because they are trying to delegitimize the president. And it's-I don't know that it's working, but lately with Lou Dobbs, with Liz Cheney, with that crazy at the Mike Castle rally, it's spreading. Something's going on, here.

MATTHEWS: Well, Mr. Campbell from California did sort of go through a road to Damascus the other night. He finally got around saying that in fact he believes the president is in fact one of us, an American.

WALSH: He did better, I must say, he did better than Liz Cheney. Now, in response to my blog post, "Politico" got a hold of Liz Cheney and she said today, not last night, in front of a large national audience, but today, "I think he has every right to be president." You know, mighty white of you, Liz. That's really good that you think he has the right. I think it's outrageous, the pandering that's going on.

MATTHEWS: Well, Mayor Brown, what do you make of this. This is a new low. I thought a new low was when they tried to make Michael Dukakis, who was the son of immigrants, sort of de-Americanize him back in '88, by making him seem alien. They're almost declaring this guy an undocumented alien, these people.

WILLIE BROWN (D), FORMER MAYOR OF SAN FRANCISCO: There's no question, that's what they are doing, Chris. But I got to tell you, the Republican Party is in shambles. Quality people, among the Republicans, really should step up to the plate and begin to denounce these lunatics, these people who are, in fact, taking away from all of the glory that, at one time, was with the Republican Party.

When you had people like Nelson Rockefeller. When you even had the Senator Goldwater from Arizona. You've had some incredible, outstanding Americans who were Republicans. It seems to me, Newt Gingrich, John McCain, the governor of Minnesota, the governor of Florida, and the former vice president, Cheney, really should step up to the plate and denounce this lunatic fringe. They don't need to say anything directly about Obama. The American people have already said that by making Mr. Obama their president, but these lunatics need to be put in their place.

MATTHEWS: What do you make of Senator Shelby joining this bandwagon

this zoo train, actually, is what it is. Senator Shelby of Alabama has been on this program many times, and I'm going to give him a chance to talk about this whenever he wants. But, why would he join those who actively, now question the president's Americanism, meaning, is he in fact a native-born American president? He's actually joins this, in fact, the nine Republican gentlemen have all joined this. And I wonder whether there's an aspect here of not documentation, but pigmentation that this is all about. Would they be doing this to a George W. Bush?

WALSH: No...

MATTHEWS: Would they be doing it to a Ronald Reagan? Somebody who's white? Would they do it to somebody who's sort of been around awhile? I mean, what's the point of this, if it isn't to bring into your question, almost, your ethnic Americanism, your basically being one of us.

WALSH: No, you're absolutely right. I mean, John McCain was born in Panama. Questions could have been raised, but they really wouldn't. Democrats wouldn't do that. You know, and his Republican colleagues, of course, wouldn't do that.

MATTHEWS: That would be a technical thing if he wasn't.

WALSH: I know, I know, Chris, of course.

MATTHEWS: I think it's worse, here.

WALSH: It's much worse, here. But, he's completely legitimate and I'm not questioning that, I'm just saying there was actually sort of a technical question there, it was never raised. I think it's very deep. I think it is racial. I think that the whole birther nonsense, it's primordial. It lets you talk about his father, a Muslim. It lets you use the name Hussein, which is scary. I will go farther, since it is late-night HARDBALL, and I'll say it focuses you on the status of his birth, which was to a white mother and a black father, so it even gets you into the taboo of interracial sex for the crazies.

MATTHEWS: Well, at least you're admitting to the facts on his birth certificate. You're beyond-they're not even willing to go this far. I was looking at the birth certificate the last couple of days, there it says African farther, Caucasian-American mother. Here's Rush Limbaugh, by the way, who has a very high IQ, he really does. He knows what he's doing, and here's what he's doing with this issue.

(BEGIN AUDIO CLIP)

RUSH LIMBAUGH, TALK SHOW HOST: Barack Obama has yet to have to prove he's a citizen. All he'd have to do is show a birth certificate. He has yet to have to prove he's-I have to show them 14 different ways where the hell I am everyday of the year for three years.

(END AUDIO CLIP)

MATTHEWS: I am waving his birth certificate around this show, yesterday, the whole show, again tonight. Mayor Brown, what is Rushbo talking about?

What are they-look at this, we are showing it on the screen, lady and gentlemen. Here it is, everybody, to watch, I mean, Rush Limbaugh can watch this. The rest-even - you know, Lou Dobbs is into this game, now. What is this-is this a viral disease here, that they're all involved with this-Mayor Brown.

BROWN: They are just off the scale on this one. Clearly the American people already have accepted Barack Obama as they have accepted Chris Matthews, Willie Brown, Miss Walsh, they know who we are. They know that we are as American as they are. And believe me, you are not going to influence even your own relatives with this nonsense about whether or not Barack Obama is a citizen. No one should have to wave their birth certificate around when you are as authentic as Barack Obama is.

If you want to call him an immigrant, call him an immigrant, and then proceed to prove that he's an immigrant. You want to question him whether or not he's American. Prove it if you think that's important. I think Rush is just wrong on this one.

MATTHEWS: I think we ought to put some money on this, like in college in the middle of the night, in the dorms, Joan and Mayor, we use to bet in the middle of the night. You want to bet? Put money on it, Rush. Put big money on it and you get behind your bet saying he's not a citizen and then you got to pay up.

(CROSSTALK)

BROWN: As a matter of fact, you ought to say, Barack, put your contract and the proceeds from your contract...

MATTHEWS: No, nobody's going to do that. No, Mayor Brown, none of us do that. None of us do that.

(LAUGHTER)

Anyway, thank you Joan Walsh for this, well, lighthearted conversation about something that's truly crazy. Anyway, Mayor Brown, thank you, as always.

Up next, back to the president's press conference, when we get back to the serious business of the republic, did he miss a big opportunity, tonight? I had a hard time getting a message out of the president, tonight. I think he might be very tired. I think this getting up in the morning at 5:00 with barbells every morning, or whatever, his schedule doesn't permit being brilliant at 8:00 at night, apparently, but it was a missed opportunity, I think, to get a big message across. Anyway, and we need that message. The "Politics Fix" for others to think and to speak, when we come back on HARDBALL on MSNBC.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: If somebody told you that there is a plan out there that is guaranteed to double your health care costs over the next 10 years, that's guaranteed to result in more Americans losing their health care, and that is by far the biggest contributor to our federal deficit, I think most people would be opposed to that. Well, that's the status quo. That's what we have ,right now.

(END VIDEO CLIP)

MATTHEWS: We're back now for the "Politics Fix" with MSNBC political analyst, Michelle Bernard and the "Politico's" Roger Simon. We all watch politics, we all study it, we try to figure out why people do what they do. The president is incredibly smart, incredibly able, with eloquent language, to get across a point. Why didn't he not get across a point tonight? What was his point, if he got it across? I missed it.

MICHELLE BERNARD, MSNBC POLITICAL ANALYST: I think everybody missed the point. I mean, if we were going to say whether or not there was s net positive or a net negative, it was barely a net positive.

He's charismatic, he is articulate, everybody likes him, you want this presidency to succeed. But, whatever the point was, it was lost in the details and the popularity wasn't enough to make the big sell, tonight.

MATTHEWS: In my experience tells me, when a politician doesn't want to be clear with you, he figures that what he tells you clearly will hurt him. He doesn't want us to know the full cost of this program. He doesn't want to know the dimensions of what he's trying to do, for some reason. Is this diplomacy-sort of the diplomatic dance he's engaged in with Capitol Hill and the Republicans? He can't tell them what he wants?

ROGER SIMON, POLITICO: Maybe it is, but I don't think it worked on TV. I mean, I don't think you can go before the American people and say you're going to finance two-thirds of a $1 trillion program by eliminating waste, fraud and abuse.

MATTHEWS: Reagan did it.

SIMON: Yeah, right. He didn't say I understand some of you are anxious or skeptical or is cynical or even queasy. Well, yeah. This is why. Presidents always promise to finance things by eliminating waste, fraud and abuse. They never do it. It is much harder than it looks like. And I just can't believe that at his, you know, his fourth dress conference, this big-deal, formal event, that was his whole message. His other message is we'll soak the rich for a little bit and we'll make up the other...

MATTHEWS: Yes, but he didn't quite say that even. He said: I could go along with Nancy Pelosi's idea of socking it to the rich, the people who make over $1 million a year. He said, but I would like to go back to my original plan, which I think is the best option, this is what he said, but basically reduce the deductibility of charitable contributions and home mortgages and things like that, which is extremely unpopular and died within an hour or two of getting to the Hill. Why'd he go back to something he knows can't sell.

BERNARD: Because it's exactly what you just said just two seconds ago. He can't go into the details. Think about all the questions that were raised by the press conference, tonight. If there are sacrifices that the American public is going to have to make, for example, what kind of tests you're going to get. Who's making those decisions? If we don't like the pinheads in insurance companies making a decision about what kind of test you get, nobody wants some dumb government bureaucrat to make that decision.

(CROSSTALK)

We want patient-center medicine. He raised so many questions, tonight, I want to know, who's making the decision? I don't like the insurance company, but I don't like the government...

MATTHEWS: Do you think he honestly believes, as Michelle puts, the country would be happier to have a bureaucrat in Washington say no to them, rather than some pinhead in Michigan or Connecticut way no to them? By the way, it's harder to get the government to change its mind, probably.

SIMON: His whole message is-and I've seen the present, it doesn't work. The current system is awful. It stinks. It'll bankrupt us.

MATTHEWS: Did he say that today?

SIMON: We'll all lose our health care.

MATTHEWS: I didn't hear that.

SIMON: Yeah, sure he did.

BERNARD: He said Medicaid and Medicare are driving-they're going to bankrupt the country.

SIMON: Fourteen thousand people are losing their health insurance, as day. The present system doesn't work, so obviously we've got to do something to prevent that. Unfortunately for him, the Congressional Budget Office says his plan will be even worse.

MATTHEWS: You know, this is a night to give examples of real-life experiences of people that have lost their health care, when they've lost their job. A real-life concerns where, like in the movie by Michael Moore, "Sicko," where people are denied benefits they thought they had. He didn't do that. It wasn't very human, to me.

BERNARD: And he also needed to show us that we will not turn into Canada or Great Britain.

MATTHEWS: Well, he didn't do either that. We'll be right back with Michelle and Roger with the "Fix."

(COMMERCIAL BREAK)

MATTHEWS: We're back with Michelle Bernard and Roger Simon for more of the "Fix." We have to talk about what we didn't expect, tonight, the unexpected, the Henry Gates situation, Professor Gates up in Harvard who was, well he was arrested briefly, then unarrested, in a case that looked to be a break-in, some neighbor said that he was breaking in, it turns out, to his own house. A police officer arrived, they got into a big dispute, lots of dispute as to what happened, but it looked like a case of profiling to the professor.

BERNARD: And to me, and probably to a lot of people, there's this old shirt, people, college students used to wear in the '80s that said "It's a black thing, you wouldn't get it," and that might be, I think, what is happening, here. I know there are people who are saying, why didn't he give over the I.D. right away? I can understand what he was thinking. I'm in my own house. You know? My neighbor probably saw a Black man breaking into a house in this predominantly White neighborhood and got scared and called the police. I can understand the type of irritation, not quite anger, but irritation at who do you think you are, this is my home, get out. There's no rule that says that when police say step out of your home, that you have to.

MATTHEWS: Yeah, I wonder when they were profiling a profile, here. What we're doing is profiling the situation as it fits a standard that we've seen, historically. But it didn't happen this time. Did that young cop or that cop was doing his job.

SIMON: Let me profile presidential press conferences. While I think President Obama is right on the facts, if you're the president of the United States, you never want to say in the same sentence, "I don't know all of the facts," "but the police acted stupidly." You just don't want to say that.

MATTHEWS: Especially if you that he didn't have his keys.

(CROSSTALK)

SIMON: If you don't have all the facts, then you don't know really how the police acted. I agree he knew the pertinent fact, or he thought he knows the pertinent fact, but Obama is just skilled enough to have put that fact aside and still dealt with the question, to have dealt with the question of race. He could have easily done it, he does that stuff in his sleep. I think he was almost-I think he was tired. (INAUDIBLE) I just don't think he handled that well.

BERNARD: I think if he had handled it differently, more Caucasians would have been happy. I think if he had handled it any differently, African-Americans would be very, very upset.

MATTHEWS: Let me ask you this, not everything on this plant is politics.

BERNARD: I agree.

MATTHEWS: O.J. Simpson either killed his ex-wife or he didn't. Everybody had their own reaction to it, racially and ethnically dividing, of course. But there is such a thing as a fact, did he or did he not do it? And in the end, that is the question. Was this case handled properly by the police? Not whether it looks like a typical case of racial profiling, but it was it, in fact, a case of police abuse or misbehavior by a citizen? And that is the question...

BERNARD: In his own home.

SIMON: Yeah, well, OK. I mean, but the fact that it was in his own home sort of removes the case of racial profiling. It wasn't a street stop where they were stopping people at random and decided to stop only Black men. It was a guy inside the house. What the police officer did wrong is disorderly conduct is an absurd charge. I think this was the president's point. It's an absurd charge when you're standing in your living room.

MATTHEWS: OK, great, thank you guys.

(CROSSTALK)

Michelle Bernard, Roger Simon. Right now, it's time for more coverage of the president's news conference, it continues on the "Ed Show," tonight, with Ed Schultz.

END

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