updated 8/12/2009 9:52:33 AM ET 2009-08-12T13:52:33

COUNTDOWN

August 11, 2009

THIS IS A RUSH TRANSCRIPT.

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

Guests: Lawrence O'Donnell, Shannyn Moore, Chris Kofinis, Melissa Harris-Lacewell

(BEGIN VIDEOTAPE)

KEITH OLBERMANN, HOST (voice-over): Which of these stories will you be talking about tomorrow?

The tale of two town halls, and one rumored administration deal with big pharma.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I do hope that we will talk with each other and not over each other.

SEN. CLAIRE MCCASKILL (D), MISSOURI: This really can't be about who's the loudest. It has to be about something that's fair. It can't be about who's the loudest.

OBAMA: Somehow, it's gotten spun into this idea of death panels. I am not in favor of that.

(END VIDEO CLIP)

OLBERMANN: The debate, the blowback, the denied deal with the health care sector with Lawrence O'Donnell; the continuing sad town hall undercurrent, the racism, with Professor Melissa Harris-Lacewell.

Palin's "Death Panel" pullback. She may have done it because her negligence as governor contributed to a real-life de facto death panel in Alaska.

And yet onwards the deathers bleat, sometimes hilariously. "Investors Business Daily" editorial of the nightmare of "we got a version of Britain's national health": "People such as scientists Stephen Hawking wouldn't have a chance in the U.K., where the National Health Service would say the life of this brilliant man, because of his physical handicaps, is essentially worthless."

Do you realize Dr. Hawking is from the U.K., and national health has helped to keep him flourishing these last 45 years?

And "Worsts": Dick Morris on how to influence Democratic congressmen.

(BEGIN VIDEO CLIP)

DICK MORRIS, FOX NEWS ANALYST: If they are not terrorized during August by the public outpouring, and they don't have thousands and thousands of handwritten letters on their doorstep waiting for them when they return from the August recess, they'll fold.

(END VIDEO CLIP)

OLBERMANN: He actually said it-actually said "Democrats should be terrorized." And he didn't get fired by FOX.

All that and more-now on COUNTDOWN.

(BEGIN VIDEO CLIP)

MORRIS: They will not mess with them (ph).

(END VIDEO CLIP)

(END VIDEOTAPE)

OLBERMANN: Good evening from New York.

No questions were out of bounds, no people were screened out. And so, today, in New Hampshire, in Pennsylvania, in Missouri and elsewhere, we saw the president and other Democrats face the real America, real supporters of health care reform, real opponents of health care reform. And other real Americans too ignorant or scared to realize that they had let themselves become megaphones for lies that do not serve them but serve only those two profit off of them.

In our fifth story tonight: President Obama's face-off at a health care town hall.

Returning to New Hampshire, recognized as the birthplace of American political town halls, Mr. Obama got a warm welcome, courteous questions, respectful skepticism-that was inside the hall. Outside-one protester felt it's necessary to show up armed, which he was allowed to do under law and the law kept him under close watch. Another, these parents, apparently felt fine using their daughter to propagate lies picked up on Sarah Palin's warning debunked already by actually elected Republicans and denied now by Ms. Palin that Mr. Obama's health care reform would involve government decisions about when old people should die.

Inside, another child posed a question about these lies.

(BEGIN VIDEO CLIP)

UNIDENTIFIED KID: As I was walking in, I saw a lot of signs outside saying mean things about reforming health care. How do kids know what is true? And why do people want a new system that can help-that help more of us?

OBAMA: Well, the-I've seen some of those signs.

(LAUGHTER)

OBAMA: But let me just be specific about some things that I have been hearing lately that we just need to-just dispose of here. The rumor that's been circulating a lot lately is this idea that somehow the House of Representatives voted for death panels that will basically pull the plug on grandma because we've decided that we don't-it's too expensive to let her live anymore. And there are various-there are-there are some variations on this theme.

It turns out that I guess this arose out of a provision in one of the House bills that allowed Medicare to reimburse people for consultations about end-of-life care, setting up living wills, the availability of hospice, et cetera.

(END VIDEO CLIP)

OLBERMANN: In Missouri, Senator Claire McCaskill did not fare quite as well as the president. This was the reaction, just by daring to begin by announcing she would pick unscreened question-questions rather, out of a goldfish bowl.

(BEGIN VIDEO CLIP)

MCCASKILL: I think what we're doing is fair. I don't want this to be who talks the loudest.

(INAUDIBLE)

UNIDENTIFIED MALE: Sit down! Sit down!

UNIDENTIFIED FEMALE: Sit down!

MCCASKILL: Hey! Hey!

(END VIDEO CLIP)

OLBERMANN: The senator succeeded on selling the crowd on goldfish bowl democracy but on other matters, matters most policy veterans do not recognize as central to the health care issue, consensus remained illusive.

(BEGIN VIDEO CLIP)

MCCASKILL: I will start with the part that will bring the immediate reaction, and that is I believe global warming is real and it's a huge problem.

(END VIDEO CLIP)

OLBERMANN: Her crowd also asked about other pressing health care matters such as whether money will go to ACORN or whether legal immigrants will somehow take their coverage back to their homeland. Of course, one pressing issue came up more than any other.

(BEGIN VIDEO CLIP)

MCCASKILL: Here's this question: Can you promise that my tax dollars will not fund abortions?

I can tell you that there is not one word in this bill that would allow federal tax dollars to be spent on abortions.

(CROWD BOOING)

MCCASKILL: Christine Brewer (ph) says, "I do not support government health care. Thank you. Taxes should not be used for abortions." Cynthia, this is the abortion question again. Would you like to ask a different question, Cynthia? OK?

(END VIDEO CLIP)

OLBERMANN: Despite a crowd that booed the news that unemployment is down, that their own 401(k)s are doing better than they were, Senator McCaskill did seem to succeed in sneaking a few actual salient points under their radar.

(BEGIN VIDEO CLIP)

MCCASKILL: Can I see a show of hands of everyone in the room who has Medicare? Everyone who has Medicare. OK. Now, let me-let me ask you to raise your hands if you have Medicare and you want to get rid of it.

OK.

We did very, very aggressive tort reform and there has been a dramatic drop-off in malpractice lawsuits in Missouri.

(APPLAUSE)

MCCASKILL: Now, I'm wondering how many of you that are clapping saw your health care costs go down.

UNIDENTIFIED MALE: How much?

MCCASKILL: Yes.

(END VIDEO CLIP)

OLBERMANN: And despite so many interruptions, booing, cat calls, so on, that McCaskill felt compelled to claim, quote, "We've got good manners in Missouri. I swear we do."

The proceedings remained relatively orderly but with only one disruption, a fight in the crowd leading to law enforcement action.

In Pennsylvania, Senator Arlen Specter let another protester have his say before also being led away. But Specter had to deal with questions just as far afield, if not more so, than did McCaskill.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Did you ever read the Koran, Senator?

SEN. ARLEN SPECTER (D), PENNSYLVANIA: The Koran?

UNIDENTIFIED MALE: The Koran.

SPECTER: No.

(END VIDEO CLIP)

OLBERMANN: Back in New Hampshire-I was going to do a spit take, I'm sorry-Mr. Obama solicited questions specifically from skeptics of health care reform. Some of those questions came from the left. One man identified himself as a Republican asking a reasonable question in reasonable fashion.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Good afternoon, Mr. President. My name is Ben Herschensohn (ph). I'm from Ogunquit, Maine, and also Bonita Springs, Florida. And I'm a Republican. I don't know what I'm doing here, but I'm here.

OBAMA: We're happy to have you. We're happy to have you.

(APPLAUSE)

UNIDENTIFIED MALE: Mr. President, you have been quoted over the years-when you were a senator, and perhaps even before then-that you were essentially a supporter of a universal plan. I'm beginning to see that you're changing that. Do you honestly believe that?

(END VIDEO CLIP)

OLBERMANN: President Obama clarified the nature of his plan, not single-payer, meaning not the government paying for everyone's health care, but, yes, universal-at least in that, everyone ought to be able to afford it. The key elements of the plan, in fact, were emphasized by him before he took the first question, acknowledging as he did that some seek to drown out these simple facts.

(BEGIN VIDEO CLIP)

OBAMA: For all of the chatter and the yelling and the shouting and the noise, what you need to know is this: if you don't have health insurance, you will finally have quality, affordable options once we pass reform.

(APPLAUSE)

OBAMA: If you do have health insurance, we will make sure that no insurance company or government bureaucrat gets between you and the care that you need.

(END VIDEO CLIP)

OLBERMANN: With us tonight once again, MSNBC political analyst Lawrence O'Donnell, also contributor to "The Huffington Post," former chief of staff of the Senate Finance Committee.

Thanks for coming back in.

LAWRENCE O'DONNELL, MSNBC POLITICAL ANALYST: Good to be here, Keith.

OLBERMANN: What should we make of Mr. Obama in New Hampshire, skeptics reasonable to his face, others with vile things to say sort of at the perimeter?

O'DONNELL: Well, now, you see why senators want to be president.

(LAUGHTER)

O'DONNELL: If Barack Obama was doing a town hall meeting in Joliet today as the senator from Illinois, he'd probably be getting shouted down a bit. He'd probably be running into Arlen Specter troubles.

But, look, you also-we also saw the most masterful political communicator of our time taking the stage in New Hampshire with a respectful crowd. That Republican from Ogunquit, Maine, seems to me to be a mainstream Republican. He has strong doubts about what the president is up to, respects him completely as both president and a human being, and was able to have that exchange with him.

That is very difficult for senators and congressmen. They don't command that kind of respect.

OLBERMANN: And that's the problem. If the McCaskill and Specter-style town halls prove the norm over this month, no matter how well Senator McCaskill did, and she did pretty well.

O'DONNELL: Yes.

OLBERMANN: She led them down to several paths to which there was no getting out of, no matter how loud did they booed. What does that do though if those-that's the predominant shape of this debate, what does it do to the ultimate shape of health care reform?

O'DONNELL: It just pushes them into a softer direction. There were e-mails going out a few weeks ago from organizations on the let's saying let's push for reconsideration of single-payer, let's push for public option. Those aren't at these meetings or being heard at these meetings. What's being heard at these meetings is push away from public option, push into a softer, softer direction.

So, that's where the political momentum is going right now through this town hall process.

OLBERMANN: Where are they? Where are the people pushing for that or at least pushing for what's in the bill right now?

O'DONNELL: Well, they are probably there and they are probably waiting for their turn to speak and they are getting drowned out. So, to some extent, this respect this may be working in terms of the way the town hall thing works.

Congressmen and senators do not base what they are doing entirely on town halls. They recognize-this is a couple of hundred people, sometimes in a state of several million people, and they are the activists and they tend to be there for reasons that do not represent the whole state. And so, they've got to be doing polling statewide to figure out exactly what their states are thinking and what their districts are thinking.

OLBERMANN: So, do we expect-and obviously, we'll get to the uglier side of the-the undertext of all of this presently. But do we expect the prospect of a backfire on this from the opponents might even legislators see that what they're hearing is exactly-as you described it it is an incredibly vocal, incredibly minority, minority, and people don't have their facts and are not bringing stuff that is germane to the debate or would oppose anything that had Obama's name on it. Is that-is that sense coming through at all or are the legislators being bullied?

O'DONNELL: It's much trickier now to make that calculation that it used to be because of the amplification that the Internet provides for these kinds of things. You know, 15 years ago, 20 years ago in a Senate office, you might get 1,000 telegrams in a day that were all identically worded. They would generally be counted as one by the smart politician.

OLBERMANN: Yes.

O'DONNELL: Now, it's much trickier to figure out what's happening, how much is grassroots, how much is Astroturf? It's very clear there's an Astroturf phenomenon on the opposition side of this health care thing. But it is not easy in a place like Missouri to figure out how much of that is fake, is organized in Astroturf, and how much of it is a genuine uprising.

OLBERMANN: We-there's a practical thing behind the loudness of the noise. There are unanswered questions about how much, if anything, the president gave away in conversations, negotiations, whichever-somewhere along that spectrum with the drug companies in return for voluntary cost cutting.

Is Congress going to show deference to that deal, if there was a deal? And, in fact, was there a deal?

O'DONNELL: Well, this is exactly the kind of question that would be coming from the left in these town meetings if they weren't getting drowned out. There is-it's now very murky as to whether there was a deal. "The New York Times" felt it had confirmation that there was a deal. The White House is officially saying there is no deal.

It's a very weird deal, because it can't be scored by CBO in the way that they've currently talked about it. And so, it's-the theory is that the drug companies would cut in effect their prices by $80 billion, saving the government roughly $80 billion in terms of purchasing on prescription drugs. There isn't a way to hold them to that deal. There isn't a way for the pharmaceutical industry to hold the government to that deal.

And they are-the reason we know as much about it as we do is because the pharmaceutical lobbyists got very upset when Henry Waxman's committee actually violated the deal and legislated exactly what they don't want.

OLBERMANN: What would have been given up for $80 billion worth of drug company cuts?

O'DONNELL: Well, the deal theoretically gets the pharmaceutical companies support for the bill, which really functions as a lack of organized opposition. These companies don't really get out there and push and support in a way that helps this kind of legislation. They simply don't attack. I don't think you could expect much more from the pharmaceutical company for this kind of deal.

OLBERMANN: Same premise as protection money, there's no break and there's no protection.

O'DONNELL: There was a very similar sound.

OLBERMANN: OK, I got it now.Lawrence O'Donnell of MSNBC and "Huffington Post" and probably once or twice of Ogunquit, Maine-great thanks for coming here.

O'DONNELL: I've been there.

OLBERMANN: I figured as much.

And once again, there is that subtext: push back against the lynching imagery, the segregation imagery, the racism imagery, and it gets louder and uglier-louder and uglier towards Congressman David Scott of Atlanta, who pushed back against all of it at a town hall last week. Overnight, somebody spray-painted something on a sign bearing the congressman's name outside one of his district offices. The graffiti was in the form of a swastika, and the Congressman is African-American-the daily double of hate.

(COMMERCIAL BREAK)

OLBERMANN: A 54-year veteran of Congress says he has seen or heard nothing like this since the Ku Klux Klan, threaten him over his vote for civil rights. The undertone from some of the agitators at the town halls, racism and late news that there was an arrest for gun possession, not the one that was shown, at Portsmouth, New Hampshire, today at the president's town hall.

And where did Sarah Palin get the idea that governor health care might include death panels and lead literally to death? From the government health care she oversaw as governor of Alaska?

And it doesn't get worse than this. A FOX commentator calls upon Americans to make sure Democratic congressmen are, quote, "terrorized."

You are watching COUNTDOWN on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: Not to make more of this than it deserves, but this is just in from the city manager's office and the chief of police's office in Portsmouth, New Hampshire, where the president was involved in that town hall today. You saw somebody with a-bearing a firearm into that event today with a license. This is a separate story.

The city of Portsmouth announcing the arrest of a Mr. Richard Terry Young for carrying a loaded pistol without a license, also misdemeanor offense at approximately 9:40 a.m. Eastern Time this morning. Mr. Young, it says, located inside of the high school where he was detained by the Secret Service, arrested by the police for that offense, carrying a pocket knife.

A search of his vehicle, police in Portsmouth say, parked on school property revealed a loaded gun. That is the mug shot of Mr. Terry Young arrested today. That is the basis for the second charge.

In addition to those offenses, according to Portsmouth police, Richard Terry Young is being investigated by the U.S. Secret Service for possible federal crimes resulting from the same series of events. Bail had not been set and Mr. Young, according to the Portsmouth Police Department, remains in the custody in New Hampshire for apparently carrying a pocketknife into the senior high school in Portsmouth, New Hampshire, at the time of the president's town hall today, and then having an unlicensed firearm in his vehicle as well.

If there are further updates, obviously, we will keep you posted on them.

To this point, no one congratulates themselves on powers of perception when the sinking feeling that there is racism at some of these health care town halls proves true, when the suspicion is born out by an obvious display of hatred, about to suggest this was a case of that, an effigy or a sign of a racial slur.

But in our fourth story on THE COUNTDOWN: It may not be the only motive, it may not be the predominant one, but it does exist, it can't be ignored. And it is an undercurrent that connects the irrational birthers to the equally irrational deathers, a crowd that believes there is an Obama death panel.

Congressman David Scott, Democrat of Georgia, victim of it-at a recent town hall meeting, he dared to accuse disruptive participants who tried to hijack that gathering. Scott's district office in Smyrna, Georgia, has now been vandalized. A four-foot swastika painted on the office sign overnight. That and what Michigan Congressman John Dingell has encountered at town halls, has reminded Dingell of something from a very long time ago.

(BEGIN VIDEO CLIP)

REP. JOHN DINGELL (D), MICHIGAN: Well, the last time I had to confront something like this is when I voted for the civil rights bill and my opponent voted against it. At that time, we had a lot of Ku Klux Klan folks and white supremacists and folks in white sheets and other things running around causing trouble.

(END VIDEO CLIP)

OLBERMANN: But there's nothing more illustrated than an account sent to "The Atlantic" magazine from someone who had planned to be attending the town hall meeting of Democratic Congresswoman Kathy Castor and Betty Reed in Tampa.

"I was to attend the health care summit. I never made it into the building. I never experienced in my life, really experienced outright racism in a public place. Signs of Obama hung in effigy, racial slurs on signs, people chanting negative words, too many to list, and outright screaming at Obama supporters. The hatred was in their eyes and they actually scared me for a moment. At first, I was shocked and then a little scared. Then I got outright mad in the span of one minute. I actually left."

Let's turn now to the associate professor of politics and African-American studies at Princeton University, Melissa Harris-Lacewell.

Good evening, Professor.

MELISSA HARRIS-LACEWELL, PRINCETON UNIVERSITY: Hi. Nice to see you.

OLBERMANN: Again, this isn't everybody at these meetings. We have no idea to what degree that-that it is this people, but they're there. And when racism becomes blatant and it's no longer even hidden behind euphemisms, how much greater is the danger not just to the conversation but to people's safety?

HARRIS-LACEWELL: Well, certainly, I think the greatest danger to people's safety is people coming armed obviously to these meetings and the biggest problem in terms of conversation is the shouting. And I think, you know, you and I both know that talking about race and labeling individuals as racists is the fastest way to shut down a conversation about what's really going on around questions of race. And it shuts down quickly because people start saying, "Well, I'm not racist. You know, I have black friends, or I've never used the 'N' word."

So, I think what we want to focus on here is exactly what Congressman Dingell was focusing on, which is the fact that these tactics and these strategies have been used by the same groups, these hate groups, like the Ku Klux Klan, heck, even by southern governments during the civil rights movement, these same strategies of massive resistance against change.And so, what we want to see is that these similar tactics have been used by those who are clearly racially biased.

OLBERMANN: To the congressman's remarks that invoked the debates in the '60s and Klan specifically, doesn't racism in this country today largely because of what we all went through in the '60s and the '70s in particular and the '50s obviously, doesn't it have a built-in self-destructiveness, not to society but to racists, to people who maintain that stance? Or is still there a reverse tipping point, could it regain not just an influential foothold in this country but a decisive one, a mainstream one? Is that still plausible?

HARRIS-LACEWELL: I think there's no doubt that part of this sort of anxiety around taxes, around health care, around all of these sort of desperate issues that are coming together in this anxiety has to do with fear of an African-American president, a woman in the-as secretary of state, a Latina on the Supreme Court. You can remember the final four contenders for the Democratic nomination. It's a white woman, a black man, a white southerner, and a Latino.

That kind of change in America produces a great deal of anxiety for people who are not quite sure that, you know, governing amongst women and brown and black people constitutes real American governance.

What I do think is the important or the good story here is that the Klan did in fact march against the civil rights movement in the 1960s. They did press back against civil rights legislation, and yet our Congress, our representatives, had the courage-the moral courage as well as the democratic courage, to push forward with those reforms because they were necessary.

So, we have to hope that this Congress will be similarly, morally courageous.

OLBERMANN: Well, and to that point, there seems to be a strategy now for protecting the town halls from agitation that serves no purpose. Even health care reform itself might go through unscathed.

But what happens to this hate that's been tapped into? Does it just move on organically to the next presidential initiative, or does it have to be prompted to move there by agitation, by media? How-does it-could it die between events, or is it with us?

HARRIS-LACEWELL: I suspect it won't die. I suspect that if sort of agitation around race were going to simply, you know, fall apart of its own accord or die, we would have seen that and, you know, in the 1870s or in the 1970s. You know, I have a father who went to Jim Crow public school, and from the time that I was a small child, he always signed my birthday cards, "The struggle continues."

And so, we are part of a continuing struggle. And we need not lose courage on that front.

OLBERMANN: Melissa Harris-Lacewell of Princeton-as always, great thanks for your perspective on this.

HARRIS-LACEWELL: Thanks.

OLBERMANN: The story that there are wild elephants roaming the sewers of New York City, that's just urban legends. That they have them in Rayong, Thailand? No comment.

And for the second time in a month, the talking head on FOX promotes terrorism. He used the future tense of the word "terrorized." He's neither reprimanded nor asked to even rephrase.

"Worst Persons in the World"-ahead on COUNTDOWN.

(COMMERCIAL BREAK)

OLBERMANN: "Bests" in a moment. Now, best liars about health care reform, and thank goodness for Stephen Hawking that he's not British.

First, on this date in 1946 was born the woman described as having the world's largest I.Q. At age 10, it was measured at 228. Her name is Marilyn vos Savant and she writes the "Ask Marilyn" column in "Parade" magazine. Her husband invented the artificial heart, and, yes, Savant does mean a person of learning. And yes, it is her real name. And, yes, I still bet on Hawking.

Let's play "Oddball."

To Rayong, Thailand-why did the baby elephant cross the street? To get to the other side. Except this one didn't. It fell into a man hole. The accident happened when the elephant's handlers were taking it to work; slave drivers.

Anyway, the villagers gathered around and they held hands, and they encouraged the baby elephant to fly its way out using his giant circus freak ears. But more practical minds ultimately prevailed and the big machinery was brought out. Bulls dozer, baby. The pachyderm passed the time contemplating its worker's comp claim. It was ultimately freed unharmed. Of course, it will never, never forget.

To the Netherlands. Not a bird, not a plane, but a flying bike. If you count four seconds, and about four feet off the ground as flying. The Dutch aeronautics student who built this thing certainly does count it. His craft has a wingspan of 85 feet and uses only pedal power, plus a good shave. Making him officially the first Dutchman to go fly a bike.

After the flight he said, quote, that was super, and it might really help him in impressing the ladies.

Why did Sarah Palin look at health care reform and see death panels? Guilt, perhaps? Because elder care in Alaska when she was governor was so bad, the federal government found, quote, the state could not ensure the health and well-being of the senior citizens she was supposed to be protecting.

And there's only room for one conservative queen bee. Meghan McCain versus Michelle Malkin.

These stories ahead, but first time for COUNTDOWN's top three best persons in the world. Theme warning, best liars about health care reform tonight.

Dateline, Los Angeles, number three, "Investor's Business Daily," home of fascist editorials that would make Attila the Hun blush. But this is priceless. It is an explanation the British system of national health which has been in place since 1945. "People such as scientist Stephen Hawking wouldn't have a chance in the UK, where the national health service would say the life of this brilliant man, because his physical handicaps, is essentially worthless."

You geniuses do know that Stephen Hawking is from the UK, right? He's actually been treated by the British national health service, right? With its services, he's lived through about 45 years of ALS, right? The goof-balls at "Investor's Business Daily" were presumably confused by the fact that his voice synthesizer did not have a British accent.

Dateline New York, Gregg Jarrett of cluster Fox about the speaker of the House; "Pelosi sort of suggested that any American citizen who dared voice an objection in a protest is a Nazi, apparently based on one isolated incident. But now she has stepped it up and she's labeling protesters un-American. Isn't that destructive rather than constructive."

Oh, my god, is he dim? Pelosi never called anybody a Nazi. She noted, correctly. that people had showed up at several town halls carrying Swastikas and symbols like that, like the one today. And she never called protesters un-American. She wrote that drowning people out at town halls was un-American, people who were for reform or against it.

And dateline Pineville, Louisiana. Senator David Vitter of that state held his own town hall on health care. Said he was totally and unalterably opposed to it. Then he mocked Democrats whose town halls had been disrupted by paid agitators. "The angry mob," he said, "is always welcome at my events. And the best security is to do what the people want you to do."

Very nice. Except for this one note about the nature of Vitter's no-holds-barred, tough-talking town hall, which comes from the pages of the Alexandria Louisiana newspaper "The Town Talk," quote, "the panel of speakers all joined Vitter in opposing the reform package being debated in Congress. Questions from audience members were screened and selected in advance of the event."

Here, kitty, kitty, kitty, kitty.

(COMMERCIAL BREAK)

OLBERMANN: It was a state-run program intended to assist the elderly and disabled with basic needs, like eating, bathing, getting to the bathroom. It was deemed so poorly managed, as one news report put it, the state could not assure the health and well being of the people they were supposed to serve. The mismanagement was fatal, with heart-breaking and stunning frequency.

The state in question, Sarah Palin's Alaska. Our third story in the COUNTDOWN, never mind Palin's fictitious, bezerk fantasy of Obama death panels, the former governor of Alaska presided over some virtual death panels of her own. A federal review in June found that Alaska health panels designed to keep people out of nursing homes and other institutions were plagued with bureaucratic problems.

The "Anchorage Daily News" reporting in one two and a half year stretch, 227 adults already getting services died while waiting for a nurse to reassess their needs. The centers for Medicare and Medicaid Services banned the states from admitting more patients into those programs until improvements were made. The suspension on admittance to one program has been lifted, but a ban remains on another Alaska Medicare program, which provides a wider range of services for people with more severe needs.

It might be assumed that such a program in any state would have these type of issues. But, no, it's just Alaska. It was the only state in the union to be put under a federal moratorium. Meantime, another Republican lashed out against the Palin death panel talk. Senator Johnny Isakson of Georgia, supporter of expanding Medicare's end-of-life planning coverage, speaking with the "Washington Post." "I just had a phone call," he said, "where someone said Sarah Palin's website had talked about the House bill having death panels on it where people would be euthanized. How someone would take an end-of-life directive or a living will as that is nuts. You're putting the authority in the individual rather than the government. I don't know how that got so mixed up."

Joining me now from Anchorage, talk radio host and "Huffington Post" contributor, Shannyn Moore. Shannyn, good evening.

SHANNYN MOORE, "HUFFINGTON POST": Good evening, Keith.

OLBERMANN: First to senator Isakson's point. Isn't the reason why things got so mixed up in this health care debate because former Governor Palin might have been registering some guilt over how many people died on her health care watch in her state?

MOORE: I don't think that Sarah Palin registers guilt. I really don't. There is a very, very long list of who's fault everything has been. Whether it's the Johnston family, whether it's the bloggers in Alaska, whether it's campaign people; it's never her fault.

So I don't think this is part of a registration of that. I think this is really a cry to her base.

OLBERMANN: Palin would have you believe that the Medicaid system is flawed. But in this particular case, isn't part of the problem, or wasn't at least part of the problem during a considerable period of time here, the incompetence of her administration, not of some sort of systemic problem with Medicaid?

MOORE: Isn't it interesting that people keep running for office-they keep telling us the government's bad and then they get in and they prove it? She's a classic case. She talks about how bad the government is and that bureaucrats are bad. Yet, she's spent a lot of time on the road last year running to be a bureaucrat, and being part of government.

She got in and she proved it. And I spent a lot of time today talking to this department. I talked to four or five different people there. And my understanding is this; that they actually requested funds, they requested more resources and were denied. All of this in a year of huge surpluses.

And, you know, Alaskans already have a permanent fund dividend check that we get from oil royalties, which she put out an additional over 700 million dollars in just checks that was above and beyond. And so, in a time where we had budget surpluses, she didn't choose to fund this department. It wasn't important to her. She's had multiple people quit because they didn't agree with her parental consent-her parental consent bill that she was trying to put Through. So-which is a, you know, pro-life I suppose, or you can say anti-choice act.

So in looking at this, you know, I don't know that it was the department's fault. I think they were underfunded. And I did talk to several legislators today who said that they are-there's a very good chance that they're going to open a hearing and find out exactly whose fault this was.

OLBERMANN: Putting aside the governor's redistribution of wealth, did she pull back on the death panel rhetoric between Friday and Sunday because of this story of her own poor track record on this subject, because that was out there, and could get national attention? Were these things interrelated in some way?

MOORE: Well, you know, someone called me and read me her Facebook entry, which is now how she is putting out any information, via Facebook. So they read it to me and I thought it must be a hoax. I didn't think it was possibly true that she would go as far as say that Obama's health care was, you know, death panels.

But she did. And she did pull it back subsequently on Sunday night, to a certain extent. And I'm not sure if it was the backlash or what, but she-she has this sort of word salad that she uses, sort of Palin speak, that really is like there's a Pavlovian response that happens from her base. And they react and they show up and they shout down.

In fact, yesterday I was at a gathering of people for various different reasons in downtown Anchorage. Her Palinistas, as we call them, were out in force with bull-horns shouting down anybody who had anything to say about health care, anything that they had to say about this moratorium, and about the energy surplus, or the energy stimulus that was actually overturned yesterday by our legislature.

OLBERMANN: Well, don't ruin their reasons for living. Don't tell them she resigned. Shannyn Moore, radio host, contributor to "Huffington Post," thank you as always.

MOORE: My pleasure, Keith.

OLBERMANN: Not even seven months in the wilderness and the conservatives are already devouring each other, as Meghan McCain says to Michelle Malkin, my Twitter following is bigger than your book sales.

Worsts; can you really suggest Democratic Congressmen be terrorized and not even have to retract it? You can if you work for Fox.

And when Rachel joins you at the top of the hour, strings are not pulled and phony protests are not created for nothing. This costs money. Special report on where it's coming from coming up.

(COMMERCIAL BREAK)

OLBERMANN: "My Twitter following is larger than your book sales."

Conservative pundit, old media, new media cat-fight next.

But first, time for COUNTDOWN's number two story, tonight's worst persons in the world, brought to you by Fixed News, which today saw Geico and Sargento Cheese Join the advertiser boycott of Glenn Lonesome Roads Beck.

The bronze to Bill-O the clown. His lead story last night, Bill-O the clown, his ratings. His second story last night, Bill-O the clown, with a guest on to talk about his ratings. His fourth story last night was Bill-O the clown, about the picture of him on the cover of "Parade Magazine."

His last story last night was Bill-O the clown, about his ratings again. He did briefly suspend his televised self-gratification, but then it was back to the ratings. He notes their increase and asks a salient question: "why is this happening? Well, a major reason is the health care debate. While the other network news broadcasts downplay the dissent and promote the government takeover of the health care industry, Fox News highlights the intense debate."

He has not asked a question about the ratings since last year when he accused the Nielson Company of altering them to make Fox look bad. Haven't heard much about that lately. Since he has asked why Fox's ratings are up, let me answer it for him. The answer is what they do at Fox News is not news. They bailed out of a live coverage of the Obama town hall today. What they do is just hatred and prejudice and paranoia reinforcement.

Both sides of an issue are covered with balance. One is treated as the revealed word. And to balance that, the other side is dismissed as fear mongering and government takeovers and the work of loons. There's no news on Fox News. And Bill O'Reilly is not a journalist, nor a newsman, nor a reporter. In fact, to borrow somebody else's phrase, as a reporter, I wouldn't send Bill O'Reilly to cover a John over-flowing.

The silver to Neil Ferguson, Harvard professor and columnist of the "Financial Times," scholar, counter-intuitive historian, and, oops, cliche racist imagery user. His new column begins, "President Barack Obama reminds me of Felix the Cat. One of the best-loved cartoon characters of the 1920s, Felix was not only black, he was also very, very lucky. And that pretty much sums up the 44th president of the United States."

The column concludes, "even Felix the Cat's luck ran out during the Depression. His creator, Pat Sullivan, drank himself to death in 1933, baffled that audiences now preferred Mice, like Mickey and Jerry. President Obama should take note," as should Harvard. Not only is he making an imagery comparison between the president of the United States and a black cat, but, maybe worse, he is suggesting that Obama needs to take note of somebody drinking himself to death.

But our winner is Dick Morris. Not only insisting that those opposed to health care reform ignore the pleadings, even from some Republicans, to be polite at the town hall, but encouraging them to, well, influence the Blue Dog Democrats who might yet delay reform. If the Blue Dogs, quote, "are not terrorized during August by the public outpouring, and they don't have thousands and thousands of hand-written letters on their doorstep waiting for them when they return from their August recess, they'll fold."

Terrorize; Dick Morris actually used the word terrorize to suggest what should be done to U.S. Congressmen, to U.S. citizens. This is the second time in a month Fox has put somebody on who has either advocated a terror attack by bin Laden in this country, as if it would be good for this country, or use the actual term terrorism as if it should be directed towards any American ever.

And nobody's been fired. Nobody's been suspended. Nobody's been reprimanded. Nobody's been made to retract or correct the comments, on the air or off. Probably because Fox's executives have spent the summer trying to suppress criticism of their worthless product, or because they agree with Dick Morris, today's worst person in the world.

(COMMERCIAL BREAK)

OLBERMANN: A few months into the wilderness years of the Republican party, besides wing-nut birther and deather conspiracy theories, it is not entirely clear what the GOP plan is for a triumphant return. Our number one story, what is clear is that if you peered into the wilderness today, you caught a glimpse of the latest round of a three-on-one knockdown, drag out cat fight, among the daughter of the last Republican presidential candidate and what she calls a trifecta of extreme female conservative pundits.

There they are, right here. Last Friday, during a live chat on Politico.com, extreme right wing commentator and author Michelle Malkin responded to the following question from Matthew: "who is a conservative political figure or commentator who you think needs to shut up?" Malkin's response, "hmm, interesting question. On the right, less Meghan McCain."

Miss McCain, who considers herself a moderate Republican voice, today responded to Malkin in her column in the "Daily Beast," "so Michelle Malkin successfully rounds out the trifecta of extreme female conservative pundits, following Laura Ingraham, and Ann Coulter, who believe that I and Republicans like me need to shut up and get out of the party. Is this surprising? Not really. I don't know exactly what about me threatens them so much, other than that people are listening to me. Eminem has the number one book on the "New York Times" best seller hard cover nonfiction list, but I have nearly twice as many Twitter followers as she does. And trust me, Twitter is more of an indication of where young people are than books published by the hyper-conservative publisher Regnery."

Back in March, McCain used her blog to call Ann Coulter on the carpet for being, quote, radical, offensive and insulting. Subsequently, radio talk show host Ingraham knee-capped the senator's daughter for playing the moderate card, effectively calling her a fat valley girl.

(BEGIN VIDEO CLIP)

LAURA INGRAHAM, RADIO TALK SHOW HOST: And do you think anyone would be talking to you if you weren't kind of cute and you weren't the daughter of John McCain? Or do you just think that they would just think that you're just another valley girl gone awry? OK, I was really hoping that I was going to get that role in "the Real World," but then I realized that, well, they don't like plus-sized models."

(END VIDEO CLIP)

OLBERMANN: Oh, no, Laura's doing that helium stuff again. Joining us from Washington, Democratic strategist Chris Kofinis. Chris, good evening.

CHRIS KOFINIS, DEMOCRATIC STRATEGIST: Good evening, Keith.

OLBERMANN: Let me start, as we always do whenever we bring up a subject like this, with the big Republican marketing plan, which I don't really see. Throw out the moderates. Alienate the minorities. Asked for ID Before letting anybody in the big tent. Get rid of the young people. Eliminate anybody merely as nuanced as Meghan McCain, or more nuanced than Meghan McCain. The goal of this is what?

KOFINIS: Well, it is apparently to lose. Everything he just mentioned is not a recipe for electoral success. The Republican party is in an ideological track. The moderates, as you pointed out, have been pushed out. The ones who are left are the screamers, whether they're at town halls, or whether it's people like Michelle Malkin and Ann Coulter and others.

And what ends up happening is that the louder they scream, the more they alienate moderates, and I would say independents. So overall, you have a serious problem in terms of being able to reach out to the critical new demographics that any party needs to be able to reach out to and attract, if you're going to be competitive in elections.

So there's a reason why Republicans keep losing elections. And if they keep this path up or this strategy up, it's only going to get worse and worse and worse.

OLBERMANN: What is the thing with Meghan McCain, though? Is it the name? Is it the message? What is it?

KOFINIS: It's both. I think part of this is a visceral dislike of John McCain. Apparently, some conservatives didn't think he was conservative enough. I also think it's an attack on the message that if the Republican party starts to moderate their views, there-I would say their radical, extreme views are going to be further and further isolated, and they're not going to have the voice that they currently have.

And that is a-that is a terrifying thing for people like Ann Coulter and others. So this is why you're seeing a lot of I think visceral hatred towards you know, Ms. McCain, as well as any moderate who dare speak out and says that the party should maybe move to the center, or be more reasonable on some issues like health care.

OLBERMANN: Is Meghan McCain right? Is there a Democratic difference between Republicans would Tweet with her and people who buy a Michelle Malkin book? Is this ultimately just new media versus old media, or something?

KOFINIS: There's a demographic difference, I have no doubt, between a younger audience that probably goes to Twitter, and the older audience or more conservative audience that buys Malkin's books. But I actually think this has to do more of kind of an old losing Republican philosophy that some conservative, you know, right wing Republicans just do not want to give up, and another path that Ms. McCain and others are advocating. And this is just indicative of the real internal struggle that is going on within the Republican party, both in the shadows, as well as in the public.

And it just tells you why they're in such a disarray. And it also gives you a very strong indication as to who is coming out to these town halls. They're being fueled by individuals who want them to go out there and scream and shout and basically make this debate about health care even more radical.

OLBERMANN: And in 15 seconds, as a Democratic strategist, who do you want the Republican party to follow of these two groups?

KOFINIS: I want them to follow the Ann Coulter, Michelle Malkin, Laura Ingraham. I think that is a brilliant strategy for the long term. I mean, that is a recipe for electoral success. Keep following it, please, please. As a Democrat, please follow it.

OLBERMANN: This message has been brought to you by Chris Kofinis, Democratic strategist. Thanks, Chris.

KOFINIS: Thanks.

OLBERMANN: That's COUNTDOWN for this the 2,294th day since the previous president declared mission accomplished in Iraq. I'm Keith Olbermann, good night and good luck.

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

END

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