updated 8/3/2009 11:28:18 AM ET 2009-08-03T15:28:18

The Ed Show

July 31, 2009

Guests: Sander Levin, Virg Bernero, Leo Gerard, Brian Bilbray, Ken Vogel, Tim Griffin, Nancy Giles, Jeff Santos, Markos Moulitsas, Lizz Winstead

THIS IS A RUSH TRANSCRIPT.

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

(BEGIN VIDEOTAPE)

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

(END VIDEOTAPE)

SCHULTZ: Good evening, Americans.

Live from Portland, Oregon, it's THE ED SHOW on MSNBC.

I'm going to be hosting a radio town hall meeting here tonight on health care, where the folks here are really fired up about a public option.

Tonight, new signs that the economy may be coming out of its tailspin.

Cash for Clunkers-that's right-is turning the car business around one car at a time. The $1 billion program was so good, the House just approved another $2 billion, although the righties keep telling us big government doesn't work. Seems to me like it's working just fine.

We'll talk to a couple Michigan lawmakers that are spiking the ball on that deal.

New e-mails have surfaced that show Karl Rove has his fingerprints all over the U.S. attorney scandal. It's time for a full investigation into what he and Alberto Gonzales were up to when nobody was looking.

And the Birthers. These crazies just won't go away. Republican leadership should come out and say to these fringe lunatics, enough is enough.

Come on, McConnell. Come on, Boehner. You're better than that. And how about you, Cantor? Are you staying with these people? Don't tell them that you're afraid to stand up to the whack jobs.

All that, "Psycho Talk," a great panel coming up tonight. And "Daily Show" creator and former talk show host Lizz Winstead will be here to give us her take on Sarah Palin's radio dreams.

And get your cell phones out. We've got a text poll coming up for you tonight. Want you to be involved in that.

But first, tonight's "OpEd."

The middle class is coming back. President Obama was handed the worst recession in 80 years courtesy of the Bush administration and the Republicans. After only six months in office, the economy is starting to show some signs of life here thanks to President Obama's recovery plan.

The big success story so far, the Cash for Clunkers program, which the president highlighted today.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Not more than a few weeks ago, there were skeptics who weren't sure that this Cash for Clunkers program would work. But I'm happy to report that it has succeeded well beyond our expectations and all expectations, and we're already seeing a dramatic increase in showroom traffic at local car dealers.

It's working so well, that there are legitimate concerns that the funds in this program might soon be exhausted. So we're now working with Congress on a bipartisan solution to ensure that the program can continue for everyone out there who's still looking to make a trade.

(END VIDEO CLIP)

SCHULTZ: Late today, the House voted to put another $2 billion into the Cash for Clunkers program. Three hundred and sixteen lawmakers, including 77 Republicans, supported it. Hooray!

Look, folks, this is a great middle class story. The folks who sell the cars are middle classworkers in America. They've been going through a real tough time.

They've gone through months where there have been empty showrooms, nobody's showing up while it was nothing but bad news after bad news for the automobile industry, and that has just dominated that industry. Now they're seeing customers coming into the showroom.

Now, look, I'm not trying to sell you tonight that this is going to fix the industry or completely jump-start the economy. But you have to admit, this is a government program that has worked, and it's a very hopeful sign that we are off to a good start.

Get your cell phones out. I want to know what you think.

Are the good economic signs proof that big government works? Text "A" for yes, "B" for no to 622639.

We'll bring you the results later on in the program.

All right. Joining me now is Congressman Sander Levin, Democrat from Michigan.

Congressman, good to have you with us tonight.

Why stop at $2 billion? Why not $5 billion? I've got kind of a, you know-a stick in my craw here tonight from the standpoint that we put $800 billion out to Wall Street. We see a $1 billion effect in the car industry. And now we only got $2 billion for them?

What do you think, Congressman?

REP. SANDER LEVIN (D), MICHIGAN: Well, $4 billion was authorized, $1 billion appropriated at first. Now we've doubled that or tripled that, depending on your mathematics. And our hope is that it will last through the time we come back.

It's a major step forward. You summed it up so well, if I might say so.

The dealers, middle income. The people who are buying it, mainly middle income. Hopefully the cars will roll out so we'll need more cars, built by people who are middle income workers. I think this is a win-win. And also, we tie it into the environment.

I think this shows that if government works with the private sector, it can work.

SCHULTZ: Congressman Levin, does this prove that the Obama economic team just knows exactly what they're doing? What do you think?

LEVIN: Absolutely. You know, I called Larry Summers last night after we found out that there was this shortfall. Look, all the money hasn't been spent yet, but they estimated, based on what was coming in, that more was needed.

Larry Summers said, "Look, I've been working on this with the rest of the administration for an hour and a half since we found out the news." Ray LaHood, the transportation secretary, was right on the ball.

I think-you know what this shows? That the administration gets it.

Manufacturing matters in this post-industrial era.

SCHULTZ: Oh, it absolutely matters. But I have a suggestion for you, Congressman. I think you ought to take those 77 Republicans who voted for it, take them out to dinner tonight.

You know, it's Friday night in Washington, D.C. If they're still around, take them out to dinner, because they are admitting that President Obama had a positive plan. This is not failure, this is success.

But what do you say to those Republicans who want him to fail and then turn and vote for one of his programs?

LEVIN: Well, I hope they've seen the light. And I hope when we all go home, we'll go to dealerships-and if I might say so, I hope more and more to the domestic automakers-and say, look, what's going on?

Meet the people who are coming in. Meet the dealers. And I hope that this really spurs more economic growth.

You know, this program is the same day as we found out that economic demand, economic purchasing, consumer purchasing, is down. What could be done better? At least one good thing, and that is to get people buying automobiles, stimulating consumer demand. So, the 77 were right on target with all but a few of us on the Democratic side.

SCHULTZ: Congressman Levin, good to have you with us tonight.

I was in a car dealership in Detroit Lakes, Minnesota, last weekend, and the car dealer said to me-he said, "Ed, this is going to take off. This billion dollars is going to be gone awfully fast." And he was absolutely correct.

LEVIN: Absolutely. Absolutely.

SCHULTZ: Good to have you with us, Congressman.

LEVIN: Nice to be with you.

SCHULTZ: You bet. Have a great weekend.

LEVIN: Thank you. Same to you.

SCHULTZ: Joining me now is Virg Bernero, who is the mayor of Lansing, Michigan, who has been waiting for good news for months when it comes to the car industry.

Virg, what are you seeing in your town on this?

MAYOR VIRG BERNERO, LANSING, MICHIGAN: Well, the showrooms have come to life, and we're getting ready. One of the plant is already not idle. Another plant is getting ready to bring workers back.

So, there is an excitement, there's no question about it. There is a change in the air. And people are buying again. And so that's great news.

You're absolutely right, it's a great success.

I just want to challenge people, by God, if you can't buy American now with this great Cash for Clunkers deal, I don't know when you'll wake up and wave the flag and realize, we've got to have some patriotic purchasing.

I heard the congressman mention it. And that's what we need.

You know, look out for your neighbor. You know, there's a lot of ways to look out for your neighbor. You can help him out in a variety way of ways, but one way is to buy American.

And I know it's tough sometimes to find that American label, but you know where the American cars are, and they're great vehicles. That Chevrolet Malibu, the Impala, the Cadillac CTS, there's some great vehicles out there. They're better than ever before.

I want to see people use these coupons, use this Cash for Clunkers, and buy American. I'm tired of excuses.

On my way here today, Ed, on my way to the studio, I passed a car that said "veteran" at it was on a Honda. By God, what were you fighting for? What are we fighting for if we're not fighting for the American way?

SCHULTZ: Well, that's another thing.

Now, this program is supposed to end the latter part of November. Would you want it to extend, and would you want it to mean just American purchases only?

Right now, it's open to all cars. Should they tunnel it to extend this program? Your thoughts?

BERNERO: Ed, this is elementary. You know, I took an oath as a mayor to the Constitution. I think the congressmen and senators took that same oath. I didn't take an oath to the WTO or the United Nations, it was to the U.S. Constitution, which talks about the health and welfare of Americans and the posterity of Americans.

What are we leaving to our kids and grandkids? Why would we incentivize the purchase of foreign vehicles? What are we doing with American taxpayer dollars?

Don't get me wrong. I understand compromises had to be made. I appreciate the program. But if we're going to extend it, let's have the courage of our convictions.

Stand up as an American, as a red-blooded American, and promote American products. Promote your neighbor. You know, look out for your neighbor. Promote the local economy.

I hear "buy local" when it comes to produce. How about buy local when it comes to manufacturing?

We need a manufacturing policy in this country. We need an industrial policy.

I heard you talk about big government, and I know what you're saying, that big government can work. And the people who are against it should think about the fact that we're confronting big government.

When you confront a Chinese company, it's 51 percent Chinese-owned. These other countries are right in there with their companies, working hand in glove, and we better, by God, have an industrial policy or we're not going to have any manufacturing left in this country.

SCHULTZ: Thank you, Virg Bernero. You know what I label you as, "America's mayor." You're one of the great ones out there.

Thanks so much, Virg.

BERNERO: Thank you, Ed. You're too kind.

SCHULTZ: You bet. You bet.

Now remember, folks, just a couple of months ago, labor organized this big bus tour cover some 30 states, and the mission of that tour was to basically save the car industry, stimulate sales. The steel workers pushed for the program Cash for Clunkers. This turned out to be one of the most successful incentive programs the government's ever had.

For more on that, let me bring in Leo Gerard, international president of the United Steelworkers.

Leo, how good a sign is this, that we're seeing consumers react? I think that's the big thing. Consumers are reacting.

How encouraged are you by this?

LEO GERARD, PRESIDENT, UNITED STEELWORKERS: Look, I think it's a very positive sign. And I'm really excited, because as you say, we did 34 cities and 11 states talking about a need to stimulate demand for the automobile industry. And I think that that tour helped to do that.

And listening to you and Virg right now, I've got to tell you that you're all on the right track. We need to do more of this.

We need to stimulate more demand. We need to stimulate more manufacturing. And we ought not to be ashamed of what we're doing.

The president of France said they were going to put $8 billion -- $8 billion with a "B"-into their Cash for Clunkers program on the condition that all that money would have to be spent on cars produced in France. For us in the Steelworkers Union, we don't assemble cars, but it's our tires, our steel, our aluminum, our glass, our plastic that goes into those cars. So, once those cars start moving off the showroom, our steel mills will start to work, our tire plants will start to work, and people will start going back to work.

And this shows that President Obama, if he could get more support from Republicans, his program is leading us in the right direction. And if we had more Republicans standing up for America rather than playing petty politics and doing stupid stuff with Birthers and everything, we could stimulate this economy. We need an infrastructure bank just like that.

SCHULTZ: No question about it.

Mr. Gerard, do you really think there'll be a manufacturing ripple effect, that we might see some jobs created in manufacturing because we're starting to see some cars move off the lot in this country?

GERARD: Absolutely, Ed. The fact of the matter is that those cars have to have-I agree with Virg about buying domestically. Those cars will have domestic steel in. Those cars will have domestic parts in. But let me go one step further.

I think we need to do the same thing with an investment bank for infrastructure. If we could do the same thing on domestic infrastructure, start to build our water treatment plants, start to rebuild all of our kind of sewers and pipelines-today, driving into work, I heard about a part of the city of Pittsburgh that was shut down because the sewer lines busted. So, we need that kind of stuff.

And to go along with the Cash for Clunkers, we ought to do Cash for Clunkers for infrastructure. And that will get people back to work.

And I can tell you that our steel mills are going to start, our paper mills are going to start, our rubber plants are going to start. And that's going to get people back to work.

They'll get some money. They'll go and buy something.

And I think we ought to push the Cash for Clunkers and we ought to put more money-in fact, I've got a good idea. Let's take the $33 billion they gave in bonuses to the clowns that created the economic mess, and let's put that $33 billion into a Cash for Clunkers program.

SCHULTZ: Well, I think what we need to point out, Leo, is the fact that we have thrown billions of dollars at Wall Street. This is a morsel of what we saw go to Wall Street to the American workers, and the consumers have responded. This ought to be a wake-up call to every person who really supported Barack Obama through it all, that he's got the right mix.

Leo Gerard, have a great weekend. Great to have you with us tonight.

GERARD: Thank you, Ed. Keep up the great work.

SCHULTZ: You bet, my man.

Coming up, the Republicans and Blue Dogs keep saying that health care reform's going to kill small business? Look, I'm going to go head to head with a Republican congressman, Brian Bilbray, next on THE ED SHOW on that topic.

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW.

You know I'm passionate about small business. I love incentives, and I support a public option when it comes to health care. Make no mistake about it.

I believe that a public option is good for every business. Rising premiums in the small business world, absolutely killing the mom and pop operations of America.

Now, the Blue Dogs in the House want a big provision-smaller businesses with under $500,000 payroll will not be taxed. Now, the previous figure was $250,000.

Now 86 percent of small businesses are basically protected. But you've got to hand it to the big companies. They're going to get hammered on this.

Joining me now is Congressman Brian Bilbray, Republican from California.

Congressman, good to have you with us tonight.

REP. BRIAN BILBRAY ®, CALIFORNIA: Great to be on, Ed.

SCHULTZ: I know the Republicans have pushed hard to protect small businesses, but what is a small business in America? Why is it that it had to go to $500,000? Why not lower than that? And I'm talking about the payroll.

What was your thinking on this?

BILBRAY: Well, first of all, Ed, this was actually negotiations between the moderate Democrats and Henry Waxman. That's where that number really came from.

And we're not-remember, it's not about the small businesses, as much as the small business employees, the people that are actually getting the job. Because I think you agree that the greatest program that we can do out there is give people jobs and be able to provide these benefits through employment. And that's the big challenge. So, the Blue Dogs were really looking at a way of being able to find an excuse to vote for this bill, and they just couldn't do it if it was going to sit there and actually cut the legs out from under the group, the small businesses, that's going to provide the employment that everybody's looking for more of.

SCHULTZ: Congressman, as the House bill sits right now, you, as a Republican, would you sign on to it? Could you claim some victory if the House bill were to come out the way it is right now?

BILBRAY: Ed, we don't even know what it is right now. And frankly, I can't vote for $1 billion-a-page document that I haven't been able to read yet. So, we've still got stuff that hasn't been out there and hasn't-look, I supported-actually provided health care in a county of over three million. I know how technical this issue is.

I think the insurance companies have got to give. But I also think the trial lawyers have to have to give. And for those of us that have actually provided health care, understand that both sides need to address the issue of, what is the cost that are not directly providing health care? And tort exposure, lawsuits are a huge issue of that. And I think one of the things we need to talk about is, is litigation the best way to do quality control in health care, or should we go to mitigation and moderation instead of all this basic courtroom decisions?

SCHULTZ: Well, I don't disagree with you that there's a lot of different facets, a lot of pieces to the pie that have to be addressed.

But Congressman, I want to ask you-the Republicans have been continually telling the American people that it's going to be a government takeover if we have a public option. I believe I've heard the president say time and time again that if you like your health care, you can keep it.

How is that a government takeover? Why do the Republicans keep pushing that on the American people?

BILBRAY: Ed, I'll be very frank with you. You're going to see many businesses that now provide private coverage, as we've pointed out, that there's procedures just like cholesterol tests that Medicare only covers for one every five years but the private sector will do one.

We're going to see a lot of companies that say, hey, it's cheaper for me to pay the eight percent and allow everybody to go onto the public rolls, rather than continue to pay. So there is an incentive actually for businesses to drop off of this. And that's one thing that we haven't talked frankly about.

And you know, Ed, we'd all love-if you ask the American public, would you like to have a free home? I think most people would say yes. If you ask them, would you like to live in public housing? I think we all would say, well, there's a problem there.

SCHULTZ: Well, for lower-income people, I think they'd like some public housing because there's a lot of people on the street. I know what you're saying, but I think the Republicans basically are trying to sell to the American people that they're afraid the public option might be so popular, so many people would go into it, and that's where the word "takeover" comes into it.

Congressman, great to have you with us. I want to have you back. And I assume that you're going to do some town hall meetings during this recess?

BILBRAY: I've already done that. And I hope to be able to get out there more. So, hopefully the next couple of weeks, we'll be able to get back to San Diego.

Let's face it, San Diego's a lot nicer place to be this time of year than Washington, D.C.

SCHULTZ: No doubt about that.

Congressman, good to have you on with us. Thanks so much.

BILBRAY: I'm honored to be with you, Ed.

SCHULTZ: You bet.

One final note on this segment this afternoon.

Senator Chris Dodd held a press conference today to announce that he has prostate cancer. He plans to have surgery to remove the tumor during the recess.

He says he's feeling fine and the outlook is good. He will continue his work as acting chairman of the Senate HELP Committee and still plans to run for re-election in 2010. Dodd said he didn't want to use his illness to make a political point, but he says, really, this drives home the now-critical thought that having good health care and a health care plan is what it's all about.

(BEGIN VIDEO CLIP)

SEN. CHRISTOPHER DODD (D), CONNECTICUT: Today, 100 people in the state of Connecticut will lose their health care coverage, 14,000 people across the country will, today, in the United States, lose health care coverage. For a person who loses health care coverage, that physical may not be something you can afford. And if you can afford the physical, you may not have the resources, the coverage, to help you deal with this problem.

It's not about me. It's about people without health care, or the ones who are underinsured. People out there struggle every day. That's what really is at risk here by not getting this job done.

(END VIDEO CLIP)

SCHULTZ: Well said, Senator Dodd. Good luck to you and your family, and with the treatment, of course.

Next up on THE ED SHOW, "Psycho Talk."

Louisiana Governor Bobby Jindal's doing a great job of handing out stimulus money to his state. The only problem is, he's signing his own name to the checks.

That's next in "Psycho Talk" on THE ED SHOW, right here on MSNBC.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW.

Tonight's "Psycho Talk"-ooh, we have got Louisiana Governor Bobby Jindal. He's thinking about 2012, but you better think about this.

Now, we all know Bobby from his disastrous response to President Obama's address to Congress back in February. Remember that? But I think he should also be recognized for his incredible hypocrisy on Obama's stimulus package.

Jindal spent months slamming the president's plan, then ended up accepting almost all of the money given to the state of Louisiana. And then after those dollars helped create jobs in his state, he's still complaining about the spending.

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN ANCHOR: Are you ready to give the president of the United States some credit for helping to turn this economy around?

GOV. BOBBY JINDAL ®, LOUISIANA: Look, I love what he says. And I do have a lot of skepticism about, in D.C., the fact they think that we can spend our way into prosperity, borrow our way into prosperity. Now they want to tax our way into prosperity.

It was auto bailouts. It was TARP. It was the stimulus.

(END VIDEO CLIP)

SCHULTZ: He says he's skeptical? But that didn't stop him from spending the stimulus cash anyway.

Then, in the same interview, he bragged about how he's creating jobs.

(BEGIN VIDEO CLIP)

JINDAL: I'm proud we've announced economic development, wins (ph) totaling 32,000 new announced jobs in Louisiana, $4.3 billion in private capital investment. We're going to continue to outperform the national economy.

(END VIDEO CLIP)

SCHULTZ: Well, so, Bobby has been doling out the stimulus dollars, and he's not just mailing out the checks. You see, he's traveling around Louisiana presenting the stimulus cash as jumbo checks, and he personally signed them.

It was kind of like, you know, Ed McMahon driving around without the balloons and fancy van. You know?

Folks, there's more.

A couple of weeks ago, less than 24 hours after presenting one of those massive checks, which included almost $30,000 that came directly from the Recovery Act, Jindal wrote an op-ed in "Politico" saying that the Recovery Act was a failure.

Bobby, you can't have it both ways.

Now he tries to just justify himself by saying he didn't accept some of the unemployment money. But it turns out that he was only about $100 million out of the $3.3 billion allotted to Louisiana.

So, Governor Jindal continuing to slam the Recovery Act while bragging about how that money is improving conditions in his state. That's some major league, hypocritical "Psycho Talk."

Coming up, I'm going to tell you about the interesting exchange I had with Nebraska Senator Ben Nelson. We got on the phone privately.

Not anymore. It seems that he didn't like the way I said on this show that I thought he should shut his trap on health care and support the president.

I'm not the only one going after the senator from Nebraska. An amazing new commercial that's going to play in Ben's state is coming up next on THE ED SHOW.

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW. Progressives are finally pushing back. The rank and file supporters who helped the Democrats get 60 Senate seats want to see a public option for health care. Now they're targeting conservative Democrats who are actually blocking reform the way Obama wants to see it. Now, here's that new ad that's out calling out Senator Ben Nelson of Nebraska.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: For six years, I've owned the Syzzlyn Skillet here in Roston, Nebraska. Last week, my health insurance agent called. He told me my rates were going to go up 42 percent from last year. I can't afford that. I told him I may have to cancel the coverage.

I'm just going to pray my kids don't get sick.

When President Obama proposes a public health insurance option that would force the private insurance companies to compete and lower rates, that's exactly what my family needs.

Now I her that Ben Nelson, the senator that I voted for, is leading the charge to delay health reform this summer.

That's exactly what they want. The health and insurance companies that have given Senator Nelson over two million dollars know that if they can stall reform, they can kill it. I have to ask: senator, whose side are you on?

(END VIDEO CLIP)

SCHULTZ: That gives you an idea what it's going to be like in August. You're going to be seeing it in your own backyard. That's what's happening in Nebraska. And Senator Nelson's spokesman, Jake Thompson, warned that if this new series of ads calling out the senators stalling on reform were an indication of any politics going on into August, then the health care reform may be dead by the end of august.

I have something to say to the Ben Nelson office. I had a personal conversation with Senator Nelson the other day. He was mad at me because I told him to shut up and support the president. These conservative Democrats have got to be called out. So I got on the phone with him. He said, Ed, that's too personal.

I said, senator, respectfully, it's personal to 48 million Americans who do not have health care. It's personal to small businesses that can't keep up with the double-digit increases that are taking place in this country. You've got to do something to reform it. A public option is the best way to go. This president had a mandate. He won nine Bush states. It's-what else do you need to know?

I'd like to know if the people of Nebraska want a public option. Now, I'm not going to go in there and do any polling. But I'd like the e-mails. I'd like some e-mails from people from Nebraska to Ed@EdSchultzShow.com . Tell me why you don't want a public option. Tell me that you think your senator is on the right page going against any kind of health care reform when it comes to the public option.

Joining me now is politico's Ken Vogel. Ken, good to have you with us on THE ED SHOW tonight. I think that commercial is pretty much a snapshot of what we're going to see in a lot of states that have got conservative Democrats. How nasty do you think it's going to get? How intense is it going to be?

KEN VOGEL, "POLITICO": Well, Ed, to give you an indication, we've already seen 34 million dollars spent on ads just on the health care issue to this point. That's unprecedented on any issue. And when you take all the issues, we see 392 million dollars worth of issue ads spending. Never seen anything close to that in any year at this point, let alone an off year.

So headed into August, we're going to see a ton of ads. Health care is going to be the number one issue by far. We'll still see a lot on the cap and trade bill, which is going to be up, by some accounts, on the floor after recess at some point. And there are going to be a few key states that are going to see a ton of this thing. Nebraska is one. Maine is another. Arkansas, Colorado; they are states that have moderate Republicans or conservative Democrats. And they're going to be deluged, so they better get used to it.

SCHULTZ: Ken, it's going to be a fun month of August, I think, for those of us in the media, because there's going to be a lot of action out there in the heartland. There's going to be a lot of action going on. The Democrats are saying they're going to do a lot of the town halls. They're going to do a lot of social networking. They're going to be giving a lot of interviews.

You know, despite the fact that we had an election, what else do they have to hear? How effective do you think the grassroots can be in 30 days before these guys go back to work?

VOGEL: Well, they don't really have to advance the issue. They just have to hold the line here. It's really the other side, the opponents, the conservative groups, the insurance companies, the Conservatives for Patients' Rights, the Rick Scott group, that really have to make inroads here. Democrats have the votes. The Ben Nelsons of the world, they may not be sold on it yet, but they're at least in the middle. And there are some who are further along towards the Obama position.

So what we're going to see is a battle by Democrats and the grassroots network that President Obama built during his campaign that is now organizing for America out of the DNC, to really hold that line. And the other groups pushing to sway moderates and conservative Democrats into the no column.

One thing that they have going for them, though, that the folks pushing the health care plan have going for them, is that August traditionally is a month where not a lot of folks are paying attention, particularly in an off year. They're taking their kids to the beach, to the pool. They're focusing on barbecuing. They're not watching a lot of TV.

SCHULTZ: I tell you what, I'm going to be hosting a radio town hall meeting tonight here in Portland. I can tell you, if it's any indication what was I saw in Madison, people are fired up for this issue. I think it's going to be a very active August.

Nancy Pelosi gave the marching orders to the Democrats before they went to recess. Here's what she had to say.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D), HOUSE SPEAKER: There will be a drumbeat across America, a positive drumbeat across America about what this means to the American people, for them individually and their families, for our businesses to be more competitive, for our economy to be more dynamic.

REP. CHRIS VAN HOLLEN, DCCC CHAIRMAN: You have a lot of allied organizations that support health care reform that are already out there carrying the message, and we'll intensify that message over the next six weeks.

We're going to make sure that health care reform does not get Swift-Boated during the month of August.

(END VIDEO CLIP)

SCHULTZ: Ken, got to ask you, have you ever seen such a big issue go into a recess?

VOGEL: Well, certainly that's the reason why they wanted to get it done before the recess, is because of the risk of this Swift-Boating, as we heard mentioned there. And, you know, they do stand to risk, leaving it on the table, going into the recess. There is some time for the opposition to really get traction. They were unable to do it because Obama, very astutely, kept a lot of these groups at the table for as long as he could, before he released the details of the plan, that some of them found it objectionable.

And now they're really racing to make their objections known in a way that really resonates with the American people. And we haven't seen it take hold yet.

SCHULTZ: Ken Vogel, "Politico," thanks for your time tonight.

VOGEL: Thank you, Ed.

SCHULTZ: You bet. For more, let's bring in our panel tonight. Nancy Giles is a political writer and commentator. Jeff Santos, radio talk show host for WWZN in Boston. You can find him on the web at RevolutionBoston.com. And also with us tonight is Tim Griffin, former U.S. attorney and a Republican strategist.

Tim, I'll go to you first tonight. I would imagine we could use the hockey term going into August. This is going to be a Donny Brook. Is this the Waterloo for the Republicans? If they don't get it done in August, they may not get it done in stopping reform. How important is the next 30 days?

TIM GRIFFIN, REPUBLICAN STRATEGIST: August is a critical time. The thing is I think August is precarious for the Democrats. You have to remember that the people that people like Mike Ross represents in the fourth district of Arkansas are a lot different than the people that Nancy Pelosi represents in San Francisco-

SCHULTZ: But do those people in Arkansas don't want health care reform? Are they happy with being uninsured? Many of them are in Arkansas.

GRIFFIN: That's a false dichotomy. To say that you're either for this health care reform or you're for nothing at all is a false dichotomy. There's all sorts of in between. Right now, what we're debating is the one driven by the majority in Congress. And I can tell you-you know, I'm right here in Little Rock and I talk to a lot of people in the fourth district, my home district, all the time. And people are going to be loaded with questions for Mike Ross when he gets back.

He can spin it any way he wants. A lot of people here believe he caved in on this issue to Henry Waxman and Nancy Pelosi.

SCHULTZ: How'd he cave in? Tim, how did he cave in?

GRIFFIN: Because a lot of people were counting on him to ask the tough questions about how this health care reform is going to be paid for. I think-

SCHULTZ: We're going to tax the top two percent. That's coming later on with the Ways and Means Committee. Let me go to Nancy Giles. Nancy, how are the Democrats going to fare? I mean, can the-basically, Nancy Pelosi is asking the grassroots to get out there and go kick some tail on this. That's what it comes down to.

NANCY GILES, POLITICAL WRITER: That's exactly what they should do. I mean, I love that Ad, that Ben Nelson ad you showed earlier. It's exactly what needs to be said. First, put some doubt in people's minds about how much money their different senators and representatives may be getting from the health care industry, so that at least they have something to sort of think about, where their representatives, elected representatives' agenda might be.

It's shocking to me that you could vote someone in office and they can take a different view than what their constituents want to get health care, to get a public option. I just like the fire that seems to be coming out now with Nancy Pelosi. I like the fact that she's even saying that the health care industry is immoral.

SCHULTZ: She's getting after it. There's no doubt she's getting after it. Jeff Santos, what about-sounds like the Democrats are basically saying, if we can't get the grassroots out there to do what they did for Obama on this issue, that we're not going to get this thing done the way we want it. What do you think?

JEFF SANTOS, RADIO TALK SHOW HOST: We've got to get it done. I'll tell you right now, call 202-225-3121. That's the switchboard in Washington, D.C. for the U.S. Capitol. You tell them you want a public option. Tell them you want to do it for Ted Kennedy. He's been doing it for 47 years. He understands the need. He understands what it's about.

The Health Committee has a public option. If Mini Max Baucus understands that, he'll get on the program to make sure it goes to the Finance Committee to get it done.

GRIFFIN: Ed, I've been passing out that same number today, and getting a response from people who say, yes, we're going to call that number. We're going to call that number and say, Mike Ross, you need to help stop this.

SANTOS: Why would you want to stop it? Do you not want to have 48 million people have health insurance, Mr. Griffin? Why are you letting people not have it?

GRIFFIN: Let me tell you-

SANTOS: No, let me tell you this. Why can Canada? Why can western Europe have health care?, and we don't? Why are we the only industrialize the country-

(CROSS TALK)

GILES: Senators and Congressmen have the same plan as Americans-

(CROSS TALK)

SCHULTZ: I want Tim to respond to that. Why deny people who don't have insurance any kind of reform, Tim?

GRIFFIN: I do not believe that health care reform should be denied.

What I believe is we need to find out, A, how much this is going to cost. First it was going to be paid for by savings. Then it was going to be paid for by taxing sugary drinks. Then it was going to be paid for by people making over 200,000. Now it's going to be paid for by people-

SCHULTZ: Nancy, how's it going to be paid for?

GILES: I think any way it can be paid for. I think the sugary tax should happen. I think the tax on the top two percent of wage earners in this country is reasonable. I do, Ed. I agree with you. You're either for it or against it.

SCHULTZ: We've got a lot of battles. Stay with us, a lot more coming up.

We've got to switch gears now to the whacked out, righty birther movement. Believe it or not, it's gaining momentum. Somebody needs to get these guys a map and show them where Hawaii is, and remind them that the president of the United States was born in a United State of America. We'll show you some shocking numbers up next on THE ED SHOW.

(COMMERCIAL BREAK):

SCHULTZ: In tonight's playbook, we now have some numbers that measure the extent of this crazy birther movement. You know, those nut jobs out there who buy the conspiracy theory that President Obama wasn't born in the United States. Daily Kos conducted a poll and found out what people really thought about this issue. I think the results are pretty tragic; 58 percent of Republicans answered no or not sure when they were asked if they thought President Obama was born in the United States of America.

And if we break it down by region, 53 percent of everyone in the south answered no or not sure. Now if that doesn't support the argument that the GOP has turned into a regional party, I don't know what does.

Joining us right now for more on this and the poll, let's bring in Daily Kos publisher Markos Moulitsas. Markos, good to have you with us tonight. Are you surprised by these numbers?

MARKOS MOULITSAS, PUBLISHER, DAILY KOS: To be honest, I'm very, very surprised. I mean, we hire an outside polling operation. This is a non-partisan polling outfit called Research 2000. They poll for newspapers and other traditional media outlets. So not a biased or politically motivated polling outfit.

We asked them, check with the country; see what they think about this birther stuff. We expected Republicans, obviously, to have a sizable fringe component that really believed that Obama was not born in this country. But we did not expect over half of Republicans to really fall under that birther thing. You had these Republicans that are trying to minimize the birther movement, say that this is a fringe, I don't know why the media pays attention to them.

Eric Cantor, a Republican in the House leadership, today argued that it was Chris Matthews and liberal bloggers that were pushing this. When, in fact, the reality of the matter is that the numbers are very clear. Republicans actually believe this nonsense.

SCHULTZ: Well, I think Chris is pushing the idea that they're a bunch of nut jobs out there that don't have their heads screwed right on this. Here's what I think: I think the Republicans are out there saying, hey, we're going to have some fun with this. And we don't have anything else cooking right now. So we're going to gin up this idea and try to stir up it up. I think it's an innate thing amongst Republicans to see Obama fail. Yes, let's give him a negative answer. Yes, we don't think he was born in the United States. Any merit to that?

MOULITSAS: I think that's part of it. I think a sizable component of the Republican base that does not believe that Barack Obama is an American. It's sort of an extension of the 2008 campaign, where they were accusing him of being un-American on issue after issue.

SCHULTZ: I've got to ask you quickly, Markos, do you think this is an issue for the White House, that they need to address again? Gates said something about it the other day. Do you think that these numbers are troubling enough that they might have to answer it?

MOULITSAS: Absolutely not. I think they have addressed it time and time again. I mean, how many times do you have to release documents? It's clear by now that there's no information, no documentation, no evidence that will ever assuage components of the Republican party that thinks Obama is not an American citizen.

SCHULTZ: Markos, thanks for joining us tonight here on THE ED SHOW.

One last page in my playbook tonight; this is one of the most famous images from the early days of the Obama administration. You got it, the Rose Garden picture from yesterday. Today, we got the details of what went down at the White House.

The president didn't ask for any apologies. No apologies were offered. But Professor Gates and Sergeant Crowley made a plan to have lunch at a Cambridge pub sometime soon. I think the best quote that came out of all of this, Gates told the New York times, quote, "when he's not arresting you, Sergeant Crowley is really a likable guy."

Isn't that the case with every law enforcement officer? I'm glad to know that the professor's got a good sense of humor. That's the playbook quote of the day.

All right, coming up on THE ED SHOW, this week the Republicans have stooped to a new low. They're trying to prove the Democrats' health care plan will kill senior citizens, literally kill them? Coming up, "Daily Show" creator Lizz Winstead. She's got a take on that. Stay with us. You're watching THE ED SHOW on MSNBC.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW. If it's Friday, it's time for Club Ed. Joining me now from 30 Rock is comedian Lizz Winstead, co-creator of the "Daily Show" and the brains behind "Wake Up, World." Hey, girl, how are you doing tonight?

LIZZ WINSTEAD, CO-CREATOR OF "DAILY SHOW": You know, Ed, it's always sunny here in New York. Oh, wait, that's not true.

SCHULTZ: That's right. OK, Sarah Palin doing a talk show. I understand you might be the first caller. Is that right?

WINSTEAD: You know, Ed, what Sarah Palin doesn't realize that the rest of us do is as America has gotten to know Sarah Palin, they've grown to dislike her. So putting her on the radio three hours a day is sort of going to have the opposite effect of all the good things she wants to do for Alaska.

SCHULTZ: She'd actually have to read, though. You never know, it might be a good thing for her.

WINSTEAD: I just don't think radio's her medium. She got by on sort of her winky, hotness, legginess, which none of that really works in radio, I've found.

SCHULTZ: No, it doesn't. Let's talk about the Republicans and health care.

WINSTEAD: Oh!

SCHULTZ: They've got this fetish with scaring us across America. In fact, this week on the House floor, this is what Republican Virginia Foxx had to say. I want you to respond to it.

(BEGIN VIDEO CLIP)

REP. VIRGINIA FOXX ®, NORTH CAROLINA: Republicans have a better solution that won't put the government in charge of people's health care, that will make sure we bring down the cost of health care for all Americans, and that ensures affordable access for all Americans, and is pro-life, because it will not put seniors in a position of being put to death by their government.

(END VIDEO CLIP)

SCHULTZ: I just want to know, Lizz, was that scripted or was she winging that?

WINSTEAD: Here's the thing about Virginia Foxx; she is from the great state of North Carolina, who has a sort of getting rid of the elderly plan, which is called the tobacco industry. So she is-that is hypocrisy at its finest, if you ask me, when somebody from the great tobacco state of North Carolina is talking about health care.

SCHULTZ: Now, what do you make of these ads that are going out, scaring Americans, saying that there's going to be a government takeover? Are we going to have the government get in between, you know, our doctors?

WINSTEAD: It's crazy because, you know, your friend Tony Perkins-

I've seen him on your show. Your friend, Tony Perkins. I call him your friend, Tony Perkins. I must give you grief about it. The Family Research Council has started this ad where you see two horrible elderly actors, the worst I've ever seen, and they're at a coffee klatsch together. The man says, oh my god, I can't get my nebulous treatment I need. But they're going to give all the health care money to Planned Parenthood for abortion!

It's like what? There's no mention of abortion in any of the plans, as far as I know. They're just going to keep ratcheting it up. You're going to see more of these ads with more scared old people, more scared people in general, just saying, they're not going to-they're going to give my unborn baby Lipitor! If you use the words health care and deny in these ads, they get frightened.

They're going to give lesbians breast implants, but I'm not going to get my treatment! It's just going to be crazy.

SCHULTZ: It is crazy. Lizz Winstead, always a pleasure to have you. You mention your mom every now and then. She's hanging in there. You've got her squared away on this?

WINSTEAD: No, Ed. You know, she won't watch me on this show. She'll turn it down to see what my hair looks like. She thinks you and I are the devil. She's awful.

SCHULTZ: We'll see you next Friday. Earlier in the show I asked you what you thought: are the good economic signs proof that big movement works; 89 percent of you said yes; 11 percent of you said no.

Have a great weekend. I'll be at the Baghdad Theater tonight in Portland, Oregon. We'll see you next week on THE ED SHOW right here on MSNBC.

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

END

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