updated 9/10/2009 11:36:02 AM ET 2009-09-10T15:36:02

Guests: Linda Douglass, James Clyburn, Andy Stern, Sen. Sherrod Brown, Joe

Madison, Todd Webster, John Feehery, Rep. Brian Bilbray, Katrina Vanden

Heuvel

ED SCHULTZ, HOST:  Good evening, Americans.

I‘m Ed Schultz.  And this is THE ED SHOW, coming to you live from the nation‘s capital in Washington, D.C.

Hey, it‘s a big night for the president; right?  But it‘s not a make-or-break night for his presidency the way the conservatives are making it out to be.

President Obama did not create this problem.  Let‘s state the obvious.  The president has been in office for all of eight months.  And for the last eight years, the Republicans, may I remind our viewers tonight, they did not nothing for health care, although they did tell you to go get a health care savings account.

The only play at this point the Republicans have is to drive the narrative of failure, and they‘ve done a pretty good job of that.  I mean, they drove the country into the ditch.  They‘re good at that.  And now they‘re trying to shift the blame to the president.  Oh, he‘s got to come up with the right one tonight.

President Obama isn‘t the decider, he‘s the fixer in all of this. 

He‘s trying to be the fixer.

He‘s got to mop up this mess the Republicans have made, let‘s see, of the economy, two wars, the future of the middle class.  See you, manufacturing jobs.  They‘re gone.  And all along, the Republicans have taken no responsibility of any of that, and they haven‘t lifted a damn finger to help the president out when it comes to a health care solution in this country. 

The Republicans, let‘s see now.  They‘ve said no to shoring up the financial system.  They‘ve said no to helping out the automobile industry.  They‘ve said no to the housing rescue.  They were against health care for kids. 

But look out.  Tonight‘s the big speech.  And he better deliver. 

Look, they don‘t want this president to have any measurable success whatsoever.  And when it comes to fixing the country‘s biggest domestic problems, they‘re going to sit on the sideline and obstruct. 

Now, they have been against every single proposal the Democrats have put on the table when it comes to health care reform.  You can‘t deny that. 

Democrats want single payer.  Republicans said no to that and they got a little help from Max Baucus. 

Democrats came back with a public option.  Oh, we can‘t do that either.  That‘s not going to work.

Conservative Democrats started pushing this thing which I‘m totally against, this co-op thing, because Republicans said, well, you know, we might take a look at this.  And now they‘re saying, no, we don‘t want to do that either. 

It‘s time to stop trying to work with Republicans.  It‘s time to be the two-fisted Democrat that we saw in the primary.  They have no ideas, period. 

They want you to fail, Mr. President.  You deserve credit for trying to fix the problems.  No doubt about that. 

Let‘s remember, you take Obama out of this and you know what we‘re talking about tonight?  Iran.  And maybe World War III with John McCain.  Not doing anything domestically. 

So about the speech tonight, let‘s clarify.  The president, I agree, needs to show passion.  And hold it right there, because I remember the president just the other day talking to the unions, how passionate he was and what he wants.  I‘ve got to see that tonight.  I think his base needs to see that tonight. 

Mr. President, go to your roots.  Mr. President, remember where you came from and remember who put you in office.  And don‘t ever forget that, because you‘ll go back to office again.

Forget Max Baucus.  The Baucus plan is bogus.  Co-ops, it‘s a hoodwink.  They‘re not going to work. 

Baucus, you know what he is?  He‘s a Democrat.  At least he says he is.  But he is a sellout to big insurance.  That‘s what he is. 

He sold you lefties out on single player.  He sold you out on public option.  And now, all of a sudden, he comes out of a meeting today saying, well, I need another week to figure this thing out. 

You know what he‘s got to do?  You know what he‘s got to do?  He‘s got to run it by big insurance.  He‘s got to make sure the big boys who have lined his pockets are OK with this thing coming out of the Senate Finance Committee. 

As a Democrat, as a liberal, a proud liberal, a progressive, I‘m sick of this.  Aren‘t you just frustrated, Americans? 

You know what he has to do tonight?  Here‘s what the president has to do.  He has to give them a little Karl Rove talk—we won, you lost, get over it, here‘s where we‘re going. 

And oh, by the way, Max Baucus is now officially part of the September stall.  I say—and I do a lot of hunting in the Midwest—kick the Republicans to the side of the road like roadkill.  Kick them under the table.  Let‘s go do a deal for the American people. 

That‘s what I want tonight.  I want the president to stand up tonight and say, this is where we‘re going.  We‘ve waited too long.  We‘ve got to get there.  The Republicans are in the way. 

Now, you think about this, folks.  This summer, they‘ve tried to convince Americans—the Republicans—they‘ve tried to convince Americans that the president‘s not even American.  Just this week they said, well, he can‘t talk to school kids.  Holy smokes, he‘s a socialist communist, a Hitler, and everything else.  We can‘t have Barack Obama talk to school kids. 

This is what you‘re dealing with. 

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

How do you feel about the president‘s speech tonight?  A, hopeful, or B, worried?  Text “A” for yes and “B” for no to 622639 and we‘ll bring you the results later on in the show.

Now, I‘m passionate about this because I have done my town hall meetings, too.  There isn‘t anybody in the Congress who has got anything on Ed Schultz.  I‘ve been all over this country and I know exactly what the people are saying. 

Mr. President, the progressive movement put you there, they are with you.  The Blue Dogs, the red dogs, the yellow dogs, you know what they did?  They went along for the ride.  They enjoyed that ride to the White House. 

They enjoyed that ride to the majority. 

Don‘t worry about Ben Nelson.  Ben Nelson‘s an all-American nobody.  He went with Bush on the Bush tax cuts.  Now look at the economy.  We‘ve got to deal with that. 

Don‘t worry about these conservative Democrats.  You stay with your base, get it done in the House, and let‘s play hardball in the Senate. 

I‘m all for it.

Joining me now is Linda Douglass, the White House communications director for the Office of Health Care Reform. 

Linda, maybe—are my expectations a little bit to high tonight?  And I‘ll take the liberty to speak for good lefties across the country. 

Are we expecting too much?  What do you think?

LINDA DOUGLASS, COMMUNICATIONS DIRECTOR, OFFICE OF HEALTH CARE REFORM: 

I think you won‘t be disappointed, Ed, because the president is going to make it very clear that we are now in a different phase, that we have to move forward and we have to take the pieces of all of the legislation that has been crafted by the various congressional committees, and we have to enact health care reform that is going to provide security and stability for people who have insurance, going to make sure that people who do not have insurance can find affordable coverage, and is going to drive down the skyrocketing, oppressive rising cost of health care that is crushing families and businesses, the economy, the government.  He‘s going to make it very clear where we need to go. 

SCHULTZ:  OK.  And I respect all of that, and I just got a little excerpt of what the president‘s going to be saying tonight.  And I want to read it. 

He‘s going to offer up a plan tonight, and it‘s going to read, “Under this plan, it will be against the law for insurance companies to deny you coverage because of a pre-existing condition.”

I am on bended knee tonight to the White House.  This is the key issue.  Is the president going to have any negotiating room whatsoever on this issue, or is he going to stick to that?  Because the pre-existing condition, in my opinion, from what I hear all over the country, that is the key. 

How dogmatic is the president going to be on that issue, on that statement which is in his speech tonight? 

DOUGLASS:  Well, I certainly don‘t want to characterize the president as being dogmatic, but he has made it very clear that this is legislation that must contain consumer protections for every American.  You know, 12 million Americans were denied or discriminated against in health insurance coverage because they had pre-existing conditions. 

All the time, Americans are finding that, suddenly, when you have a big medical expenditure, it turns out there‘s a cap on your coverage, or the insurance company uses an excuse to take your insurance away.  So, for example, we heard a terrible story about a woman who had cancer.  The insurance company said, well, you didn‘t report that you had acne, and so they denied her coverage for the cancer. 

These are the practices that the president says will immediately be illegal. 

SCHULTZ:  And Linda Douglass, I have to point out, this is the very

system that the Republicans have been protecting.  This is the very system

the Republicans have said, no, we can‘t reform that.  Heck, it‘s tort reform.  We‘re suing too many people. 

The Republicans have been horribly silent (ph).  They‘ve tried to tell the American people that the president is not born—he‘s not an American, that he can‘t talk to school kids.  There‘s just a long list of things.

I mean, when do the olive branches get cut off?  Are some of the olive branches going to get cut off tonight in this speech? 

And I guess I‘ve got too much—I‘m ready to go after this big-time.  So, I guess my point is tonight, are we going to get a cutaway from all this bipartisan talk and start read to go down the road to do the deal for the American people? 

DOUGLASS:  Well, you know, the president made it pretty clear, I think, in his Labor Day speech to the AFL-CIO.  Look, we want to work with Republicans.  We‘ve been doing this very vigorously over the last several months. 

Whatever legislation is enacted will clearly contain Republican ideas.  The president‘s made that very clear along, and he will make that clear again tonight. 

Obviously, you know, Republicans, he asked them at the Labor Day speech, what‘s your idea?  What is the proposal that you want?  Because even the Republicans who talked about the boisterous town halls, those few town halls that they encountered over August, they also came back to Washington realizing that doing nothing is not an option.  They heard from constituents all over the country who are struggling with health care. 

SCHULTZ:  Well, it‘s down to six people, I guess, in the Senate Finance Committee.  And I‘m not convinced that they‘re going to get it done. 

There‘s one other thing that I‘d like to read that the president is going to say tonight.  He says, “As soon as I sign this bill, it would be against the law for insurance companies to drop your coverage when you get sick or water it down when you need it the most.”

We‘re going to hear some things tonight that we haven‘t heard from President Obama, and I‘m pretty fired up about that.  And I‘ll guarantee you—I‘ll make a prediction, Linda.  You‘re going to end up having to do this on your own, because I don‘t think the insurance companies are going to go along with a pre-existing condition.  I don‘t think the Republicans are going to go along with a mandate that you can‘t drop people, because that‘s how they make money and who lines their pockets. 

I‘ll give you the last word. 

DOUGLASS:  You know, and as the president is going to say tonight, you see that in the excerpts, the time for bickering is over, the time for action is now.  And we are going to act.  We are going to move forward.  And he‘s going to make that very clear in his speech tonight, Ed. 

SCHULTZ:  Thank you, Linda.  Appreciate your time tonight. 

DOUGLASS:  Thank you.

SCHULTZ:  Linda Douglass from the White House here on THE ED SHOW.

For more on this, let me turn to Congressman Jim Clyburn, House majority whip. 

Congressman, great to have you with us tonight. 

REP. JAMES CLYBURN (D), MAJORITY WHIP:  Thank you for having me.

SCHULTZ:  Jim, I‘ve talked to a few people on the House side today, and they were telling me that, heck, you guys had a great caucus meeting today.  I mean, the Democrats came back, went behind closed doors, and everybody‘s roaring about a public option.

Tell us what was in that meeting today.

CLYBURN:  Thank you so much for having me, Ed.

You‘re right, we had a great meeting this morning.  I was very pleased, a little bit surprised, with how positive so many of our members were, some of whom left here back in August not sure about this public option, coming back very strong for a public option.

I think we‘re going to get a piece of legislation passed very soon that will have a public option in it.  I think it will have all of those things that you just talked about, making it illegal to discriminate against people because of pre-existing conditions, to make it illegal for insurance companies to drop people when they get sick or have some potential of getting sick, making sure that we get—make it a little bit of an incentive for people to participate in prevention.

So, I think it‘s going to be a good bill that we are going to come up with, and it will be (INAUDIBLE) from what the president will say tonight.

SCHULTZ:  Now, what is this pilot program that you, Congressman Clyburn, have been talking about that you would almost like to incrementally get to a public option if you can‘t get it in the House.  I mean, that sounds to me like major league wiggle room to me.

What about that? 

CLYBURN:  No it‘s not.  Let me explain it to you. 

SCHULTZ:  OK.

CLYBURN:  The bill, as currently constituted, said that the exchanges will be put in place in 2013.  And the part of the exchanges will be what we want, a public option. 

What I‘m saying is, in the three-year period while we are waiting for 2013 to get here, let‘s put in place some pilot programs, some pilot exchange programs with the public option, and let‘s work out the kinks during this period of time.  I think that if you do it the way I‘m proposing, when you get to the state of making it a permanent part of the bill, you‘ll have some best practices, you‘ll have some procedures in—some data upon which you can make a good, solid decision. 

So, what I‘m saying to people, what are we going to do in this three-year interim while we wait on the exchange program to take place?  I‘m saying let‘s have some pilot programs in that interim. 

SCHULTZ:  OK.  Well, I‘m all for that.  I think the American people would be for that, too, because then we could see if it would work. 

CLYBURN:  I think so.  Absolutely.

SCHULTZ:  I mean, basically, we‘d see if it would work, we‘d see some return.  And I don‘t think the American people can wait another three years to have some type of legislation kick in to fix our biggest problem in this country. 

Jim, there‘s one other thing I want to ask you.  You said—you characterized this meeting as very positive.  Where were the Blue Dogs?  Were they aggressive in the caucus meeting today, or were the Blue Dogs just sitting back taking this whole thing in? 

CLYBURN:  The second person that went to the mike was Stephanie Herseth Sandlin, the leader of the Blue Dogs.  She had a very positive statement to make. 

She talked about us reforming health care.  She talked about us doing what was necessary to get rid of all those issues that you just talked about.  And she was very, very positive.  And I was very pleased with what she had to say. 

SCHULTZ:  Congressman, great to have you with us tonight.  I appreciate your time. 

CLYBURN:  Thank you so much for having me. 

SCHULTZ:  You bet. 

Jim Clyburn with us tonight here on THE ED SHOW.

Now, there‘s one other thing I want to point out. 

Now, we‘ve seen a couple of things here that the president is going to talk about.  Insurance companies, pre-existing conditions, going to be gone.  Once he signs it, when you get sick an insurance company can‘t drop you.  That‘s a big deal.  Also, they‘re going to place a limit on how much you could be charged out-of-pocket expenses. 

These are three big things that I‘m predicting the Republicans will not go along with, and I‘m talking about it tonight right here on MSNBC, 11:00, special edition of THE ED SHOW, 8:00 Pacific Time. 

Make sure you join us.  We‘ll do the debrief of exactly where all this is going to shake down. 

Coming up, I‘m not the only one who is drawing a line in the sand over this public option.  The leader of one of the biggest unions in the country will join me to explain just how much the president stands to lose if he backs off tonight. 

Plus, Republican Congressman Brian Bilbray will be here tonight.  I‘m not going to let him get a way with the righty talking points.  We‘re going to have an honest discussion about what this country is facing.  That‘s all coming up at the bottom of the hour. 

And Congresswoman—there she is—mean Jean Schmidt.  She was caught “Psycho Talking” at a Tea Party.  I‘ll show you the tape.  It‘s all coming up on THE ED SHOW.

Stay with us.  This is MSNBC, the place for politics.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW from the nation‘s capital. 

The president speaking tonight.  Organized labor will be closely watching what President Obama has to say tonight to the joint session of the Congress. 

Unions helped this man get into the White House last fall.  A big, big effort.  Now they want to see him deliver quality health care for American workers. 

Let me bring in Andy Stern, president of the Service Employees International Union. 

Mr. Stern, good to have you with us tonight.  I understand that you‘re going to be a guest of Speaker Pelosi at the joint session and speech tonight, which I think speaks volumes. 

She wants to know what you think.  She wants to keep you close.  Your employees want to make sure that they don‘t lose their health care benefits.  And she‘s always been for collective bargaining. 

But for you, where do you draw the line?  What does the president have to say tonight, and what does he have to present to the American people to satisfy union and labor in this country? 

ANDY STERN, PRESIDENT, SEIU:  Well, Ed, I think he has to say three things. 

One, that never again are people like Pat Pajong (ph) have to watch their husband die, the insurance company not pay off, and then give up her 100-year-old ranch.  Or That Roberta Walker (ph) is not going to lose her job, lose her health care, then get cancer and be beside herself about what she‘s going to do.  Or, sadly, Dan Broderick‘s (ph) wife is not going to have a pre-existing condition and then find out she can‘t get treated for cancer and she dies. 

That‘s one.  Never again in America. 

Two, we gave the insurance industry 50 years to care about our families and our health, and all they cared about was their wealth.  And it‘s time that we make illegal exactly what the president said—no more pre-existing conditions, no more dropping health care because you change your job.  We‘re sick and tired of it. 

And three, it‘s time to take a vote.  You know, debates are great.  America‘s had a wonderful summer.  Everybody‘s gotten their say.  But 14,000 people lost health care today, and we can‘t wait any longer. 

And I‘m so glad to hear the president say it‘s show time.  It‘s our time, and the time is now.  In the next 60 days, let‘s just get this done.  America needs it. 

SCHULTZ:  I hear you. 

Well, let me address one other statement that the president has got in his speech tonight.  He says, “We will place a limit on how much you could be charged for out-of-pocket expenses because in the United States of America, no one should go broke because they get sick.”

Is that strong enough for you, Mr. Stern?  Is that strong enough? 

STERN:  I mean, the words are fine.  I think the question is, what does that mean in the bill?  Because listen, health care reform is meaningless if we tell hard-working Americans you have to have insurance and then you can‘t afford it. 

So, if there aren‘t the right kind of subsidies—I mean, the real question here is, Ed, some family making $50,000, $75,000 a year, can they afford their health insurance?  And I think that‘s the real test here.  Not the words, but the deeds. 

SCHULTZ:  OK.  If the House passes a bill with a public option, and it‘s right there, and it‘s everything the president wants, how is he going to waver from that politically and satisfy his base if the White House gets hung up on the bickering that‘s going on over in the Senate?  I mean, if they pass what you want in the House, the president‘s going to have to stand with that, is he not? 

STERN:  You would think so.  I mean, in the end, it‘s time to take a vote.  I mean, leadership is just about making choices. 

The president says he wants a public option.  The House is going to vote for a public option.  Where are these settlers?  Let them take a vote. 

They‘ve been talking and thinking and studying and analyzing.  And what have we got?  A lot of people dying, sick, and financially in trouble.  Let‘s take a vote here, Ed. 

SCHULTZ:  Well, apparently, Max Baucus doesn‘t get it.  He needs another week. 

What‘s your response to him coming out of that meeting today saying, we don‘t have a deal, I need another week? 

STERN:  Well, September 15th, they said they‘re going to start marking up the bill.  That‘s it.  Put it on the floor, let the Finance Committee vote, take it to the Senate. 

Americans are just ready for change.  And if Senator Baucus and the committee can‘t get it done, then Harry Reid should step up and put this bill on the floor. 

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

STERN:  Thank you, Ed. 

SCHULTZ:  Next up, Republican Congresswoman Jean Schmidt was caught red-handed whispering sweet nothings to a birther at a Tea Party. 

I‘ll blow the cover in “Psycho Talk,” coming up right here on THE ED

SHOW.

You won‘t want to miss it.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.

“Psycho Talk” tonight a repeat.  That‘s right, mean Jean Schmidt, the congresswoman from Ohio.  She‘s a tough one, too. 

Last weekend, she spoke at a Tea Party near Cincinnati.  Now, that‘s a red town.  Afterwards, a riled-up birther came over to her and started hollering that President Obama wasn‘t born in America!

Well, our friends at Think Progress, they caught the congresswoman‘s response on camera.  Here it is.  Listen closely. 

(BEGIN VIDEO CLIP)

REP. JEAN SCHMIDT ®, OHIO:  Ma‘am—ma‘am...

UNIDENTIFIED FEMALE:  He cannot be a president by our Constitution.

SCHMIDT:  (INAUDIBLE).

(END VIDEO CLIP)

SCHULTZ:  Ah-ha.  Well, you know, I feel like a broken record with this birther nonsense. 

We have established over and over and over and over again that Barack Obama was born in the United States of America.  The congresswoman, well, you know, she‘s just playing to the wackos, although we shouldn‘t be surprised. 

You see, mean Jean has been spewing heaps of craziness for years.  Her most notorious offense came in 2005, when she took to the House floor to supposedly pass along a message from an Ohio state representative. 

(BEGIN VIDEO CLIP)

SCHMIDT:  He also asked me to send Congressman Murtha a message, that cowards cut and run, Marines never do. 

(BOOING)

SCHMIDT:  Danny (ph) and the rest of America and the world want the assurance from this body that we will...

UNIDENTIFIED MALE:  The House will...

(END VIDEO CLIP)

SCHULTZ:  Now you remember who mean Jean Schmidt is. 

Well, you heard the reaction of the House floor. 

Congressman Murtha is a decorated Vietnam veteran.  He was in the Marine Corps for years. 

Calling a war hero a coward is not OK.  But what does that make Dick Cheney? 

Anyway, the following year, the non-partisan Ohio Elections Commission publicly reprimanded the congresswoman for having a reckless disregard for the truth.  Kind of a Republican thing going on.

It seemed she lied about having an extra university degree.  How fitting?  But somehow, ,the folks in Cincinnati decided to re-elect her anyway. 

So, we have a history of a psycho talker, this congresswoman.  Her support of the birther nut jobs last weekend is just the latest example in a long string of “Psycho Talk.”  

Next up, Senator Chris Dodd just made a surprising decision not to replace Ted Kennedy as the chairman of the Senate HELP Committee.  I‘ll ask a key member of that committee, Senator Sherrod Brown, what does this mean as we move forward? 

Plus, I‘m not going to let the righties push these bogus bullet points at us about the president‘s speech.  And, you know, you can almost predict what they‘re going to say. 

Congressman Brian Bilbray is going to be here to go head to head with me on all of that coming up in our “Playbook.”

Stay with us.  You‘re watching THE ED SHOW, here on MSNBC.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  Big news today in the Senate.  Iowa Senator Tom Harkin is going to be taking over as the chairman of the Senate Health Committee.  Senator Harkin will be a great ally in this fight.  He‘s a great progressive from the Heartland.  He knows what the people want. 

Most of all, he gets the landscape.  I mean, this is what we told me on this program back in July. 

(BEGIN VIDEO CLIP)

SEN. TOM HARKIN (D), IOWA:  Last fall, the American people voted overwhelmingly for Barack Obama to make some changes.  They also voted overwhelmingly for Democrats to run the House and the Senate.  And so they‘ve asked it to take a leadership position.  And so we need to lead in this, and not be afraid to lead, and to push the envelope on health care reform. 

(END VIDEO CLIP)

SCHULTZ:  Well, that‘s your new chairman of the Senate Health Committee.  I‘m all about it.  I mean, you just got to lead on this thing.  He‘ll do it.  You can‘t be afraid about doing it.  Got to be bold.  You‘re going to need to really show spine to get this thing done. 

Joining me now is Senator Sherrod Brown of Ohio, a member of the Senate Health Committee.  Senator Brown, good to have you on tonight. 

SEN. SHERROD BROWN (D), SENATE HEALTH COMMITTEE:  Thanks. 

SCHULTZ:  This really isn‘t any major change.  You have a couple of seasoned veterans that know this health care thing inside out, Chris Dodd and now Tom Harkin.  Why is everybody focusing so much on the Finance Committee, as if you guys over on the Senate Health Committee—it‘s like you‘re dog food?  I mean, you know what I‘m saying.  I mean, everything—you guys have come out with a great bill, with a public option, in the Senate Health Committee.  How do you—what‘s the stall in the Senate, in your opinion? 

BROWN:  As you know, Ed—we‘ve talked about this on this show before

four committees in Congress have passed a good health insurance reform bill with a strong public option, the House Energy and Commerce Committee, House Ways and Mean, House Education and Labor Committee, and the Health, Education, Labor and Pension Committee in the Senate, which Chairman Dodd and Chairman Kennedy shared. 

This committee—this is the right blueprint.  I think you‘re going to hear tonight President Obama talking about most of the things we‘ve done on that committee.  The other committee is a bit more conservative.  And I think what‘s going to ultimately—ultimately going to get to the president‘s desk is a strong public option, good health insurance reform.  That‘s the way it‘s going to be. 

You know, this committee‘s taken longer.  So the media has to cover the story.  It‘s the only game in town, even though we did our work back in July. 

SCHULTZ:  I think the president is going to push the envelope tonight to these guys in the Senate Finance Committee.  He specifically is going to say in his speech tonight that it will be against the law for insurance companies to deny coverage of a person with a preexisting condition.  Does that play well in your opinion?  Will that get any Republicans on board in the Senate? 

BROWN:  No, of course not.  You understand, Ed, the Republicans are on a short leash with the insurance industry.  The insurance industry always backs Republicans, puts huge money into their campaigns.  They‘re on a short leash.  If the insurance company pulls on that leash, the Republicans jump back.  They mouth the words that they‘re against preexisting condition.  But if they really were preexisting condition, if they really were against discrimination based on disability or race or gender or age or geography, if they really were against these caps that insurance companies put on your plans, so that if you get really sick and the costs go way up, they rescind or pull your insurance—if the Republicans were really against those, they‘d also support the public option. 

We need the right rules, but we need the public option to help enforce these rules, so the insurance companies can‘t gain the system.  That‘s one of the reasons public option is so important. 

SCHULTZ:  Senator Brown, good to have you with us tonight.  I appreciate your time.  Sherrod Brown from Ohio.  Now let‘s bring in our panel tonight.  Democratic strategist Todd Webster is with us, XM radio talk show host Joe Madison, and Republican strategist John Feehery, who I have been waiting to talk to all day long. 

John, we‘ll go with you.  What about this?  It‘s going to be against the law.  Against the law to deny somebody coverage with preexisting conditions.  That‘s fighting words for you guys.

JOHN FEEHERY, REPUBLICAN STRATEGIST:  Not at all.  Actually, the Republican plan would do the exact same thing. 

SCHULTZ:  The exact same—which plan? 

FEEHERY:  All of them are against preexisting conditions. 

SCHULTZ:  So the insurance companies are going to go along with it? 

FEEHERY:  The big problems with the insurance companies is there‘s a state monopoly on insurance companies.  Harry Reid does not want to break those state monopolies.  If you get through to those state monopolies, a lot of people will shop across state lines.  You will cut costs immediately, without having to go to a public option.  The Senate Democratic leader will not go for it.  The Senate will not go for it.

The Republicans have been pushing this plan, which would cut costs immediately, get rid of pre-existing conditions.  There‘s a deal to be made.  I‘ve said it many times.  The Senate will not go for it. 

SCHULTZ:  OK.  Joe, what‘s going to be the stumbling block of the three points that you hear in the president‘s speech tonight?  These three excerpts that have been released?

JOE MADISON, XM RADIO HOST:  All three.  The one major one you know is going to be public option.  That‘s clearly going to be it.  Here‘s what I hope the president does—I know the speech is already out there.  He‘s not—he‘s not going to change minds in Congress.  This is not a speech to Congress.  This is a speech to the American people. 

He‘s going to have to take a chapter from Reagan‘s book.  He‘s going to have to use living examples of everyday people, a child who was born or has childhood Diabetes, a preexisting condition, and the impact it‘s had financially, emotionally.  He‘s got to pull at the heart strings of the American people listening. 

SCHULTZ:  Todd, you think that will work on some Republicans that are wavering? 

TODD WEBSTER, DEMOCRATIC STRATEGIST:  I think he is speaking to the country.  That is the audience for this.  Look, looking at the bills that have been reported out, these are bipartisan bills.  He has gone to them.  He has been deferential to the Congress as a co-equal branch of government in writing these bills. 

He has been deferential to Republicans in gathering their ideas, soliciting Republican ideas.  If you look at John McCain, his policy proposal in the campaign about catastrophic coverage is included in the bill.  So, at the end of the day, if the Republicans don‘t vote for this bill out of spite or political gamesmanship, then that‘s their problem.  But it will be a strong bill.  He‘s going to be putting some steel in the spine of some of these wavering Democrats on the Hill in the speech tonight. 

SCHULTZ:  On the House side, Nancy Pelosi is holding a lot of cards on all of this.  If she gets a bill passed with a public option, how can the president run from that bill?  He‘s going to have to stand up there and tell the senators, hey, I‘m going over here.  This is where my base is.  And that could be a tough moment for Democrats. 

John? 

FEEHERY:  As an old House guy—I worked in the House for 16 years.  I understand the dynamic of the House.  People went back in August.  It was the ugliest August I have ever seen in my political career.  People were angry, especially in the Blue Dog districts.  You hate the blue jobs. 

SCHULTZ:  Hate is strong.  I just think they need counseling. 

FEEHERY:  They‘re the majority makers.  They represent a huge bloc that could actually change this thing.  Nancy Pelosi has said one thing.  Steny Hoyer has said something else.  That‘s a real conflict. 

MADISON:  It‘s a math game.  I‘ve not worked in the House.  But it‘s a math game.  I think what Nancy Pelosi has done, along with Jim Clyburn, the leadership, and Steny Hoyer, they‘ve counted the votes.  They know those votes are there.  The math is there. 

SCHULTZ:  So—

WEBSTER:  Let me just say, we‘ve had a public option in this country since 1965.  It‘s called Medicare.  It‘s available to every American over the age of 65.  For Democrats, who in our DNA are programmed to be standing up and protecting Medicare—it‘s in Republicans‘ DNA to undermine it and destroy it.  They‘ve been doing it since 1965.  For a Democrat to be opposed to the public option is like a Republican being opposed to tax cuts for the rich.  It makes no sense.  

SCHULTZ:  I don‘t get it.  Great discussion.  We‘ll have you back.  Tonight, we‘re going to be back at 11:00 with the special edition of THE ED SHOW.  I guess you could say post-game to the president‘s speech to the joint session. 

Coming up, the Republican playbook.  The Congressman picked to give the response tonight has questions about where the president was born.  And the House minority leader is calling on Obama to hit what?  The reset button and start health care reform from scratch?  Republican Congressman Brian Bilbray is going to be talking to me about that in just a moment.  Stay with us.  You‘re watching THE ED SHOW on MSNBC.

(COMMERCIAL BREAK)

SCHULTZ:  OK.  We‘re going to be opening up the Republican playbook tonight.  Today, House Democrats went behind closed doors, circled the wagons on a public option.  They‘re all about it.  The only hope that the House Republican—I think that they‘ve got right now—the only hope they‘ve got is for the Blue Dogs to come in and screw this deal up. 

Tonight, Republican Congressman Boustany—he‘s a doctor—is going to be giving the Republican response, and he‘s going to be talking about the doctor/patient relationship.  What is this?  The “Dr. Phil Show?”  Cut me some slack. 

We need some premiums lowered.  We need some details.  Joining me now to give the prebuttal to the president‘s address is Congressman Brian Bilbray of California.  Good to have you with us tonight.  What do the Republicans want to hear from President Obama tonight? 

REP. BRIAN BILBRAY ®, CALIFORNIA:  Well, I think first thing I have heard in my town hall meetings was the bottom line.  Before you start making promises, how are you going to pay for it?  Where‘s the money going to come from?  If waste, fraud and abuse can produce three quarters of the money, why aren‘t we talking about doing that first to sort of prove to America that we can be trusted with this type of effort? 

SCHULTZ:  Congressman, the president has said he‘s in favor of repealing the Bush tax cuts.  I assume that wouldn‘t fly with you or the rest of the Republicans, correct? 

BILBRAY:  I think then do that up front.  Let‘s talk about that.  That‘s not what I heard him say.  I kept hearing him say there was so much fraud, waste and abuse—so much abuse of the system that we could produce huge amounts of money.  The question everybody has is, why haven‘t we done that first?  Develop the credibility. 

That‘s one of the things everybody is missing here.  There‘s a real lack of credibility with Washington when you talk to the average citizen out in America.  This isn‘t Democrat or Republican.  This is a general issue.  Earn some credibility by doing the heavy lifting, the tough stuff.  Take on our buddies who are ripping off the system first.  And then talk about promising more services for what you can‘t afford. 

SCHULTZ:  Let me ask you this.  The president, tonight, is going to say that it is against the law for insurance companies to deny people coverage for preexisting condition.  That‘s kind of a heavy lift, I would say.  Would you go along with that? 

BILBRAY:  I think it is a heavy lift.  I think there‘s a possibility we‘ll do that.  He also has to address that other big elephant in the room.  That is the tort issue.  That one thing—those of us in California, which is actually a legislature controlled by the Democratic party, has known tort reform was important for health care. 

SCHULTZ:  All right.  Do we have some wiggle room here?  Would you give in to the preexisting condition if the president were to do something about tort reform?  How many House Republicans do you think that would bring over? 

BILBRAY:  I think it would be a huge jump if he‘s brave enough to take on the trial lawyers.  The problem is they‘re not even talking about that.  Those of us in California who are actually trying to save a system back there understands tort reform is absolutely, essential cost reduction part that is not providing health care. 

SCHULTZ:  What about telling insurance companies that they can‘t drop people when they get sick?  What about that?  Would you go along with that? 

BILBRAY:  I think that is one of the things we need to continue to do. 

In fact, I think the other issue is stop this concept—

SCHULTZ:  Continue to drop people?  Right now, insurance companies are dropping people after they get sick.  You don‘t want to do that, do you? 

BILBRAY:  They shouldn‘t be able to drop them if they‘re insured at the time it came down.  What we have to talk about is why does the federal government subsidize or give tax benefits for big labor and big business for their employees, but the individual doesn‘t get the same tax benefit?  We should give this tax benefit across the board to every American, regardless of where they‘re employed. 

I think we can agree on that.  That‘s one of those things that we ought to be talking about, before we start talking about raising taxes. 

SCHULTZ:  Finally, Congressman Bilbray, you really need the Blue-Dog Democrats to screw this thing up to give President Obama failure.  That‘s really where you‘re at, right? 

BILBRAY:  No, the fail on this one is the president has to—he‘s going to fail if he doesn‘t explain how he‘s going to pay for it.  It‘s not going to be promises of great savings and great revenue that is not on before you.  You wouldn‘t buy a product for your grandchildren you couldn‘t afford or for them not to be able to afford.  I think that‘s what it‘s really coming down to.  Where is the money going to come from to keep these promises, before we make the promises? 

SCHULTZ:  I think he‘s going to try to later on say, let‘s repeal the Bush tax cuts.  Congressman, great to have you with us tonight.  I appreciate your time. 

BILBRAY:  Thank you very much. 

SCHULTZ:  You bet. 

Next up, the president‘s got about more than an hour until he delivers what some say is the most important speech of his presidency.  What about those on the left?  “The Nation‘s” Katrina Vanden Heuvel coming up.  An extended conversation with Katrina.  Where does she stand?  What does she want to hear tonight?  Where are the liberals when it comes to expectations?  That‘s next on THE ED SHOW.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  President Obama‘s big night starts in a little over an hour.  He needs to come out and support the public option, in my opinion.  The American people want it.  They want it.  They want some guarantees.  The president has got to come through for the folks who put him in office.  And what would be the political downside if he‘s not strong enough down the stretch?  Not just tonight, but down the stretch. 

Let me bring in Katrina Vanden Heuvel, editor of “The Nation.”  Katrina, great to have you with us tonight.  What do liberals—what does the progressive movement, Katrina, have to hear tonight from the president tonight?  How pivotal is this?  What do they have to hear? 

KATRINA VANDEN HEUVEL, “THE NATION”:  I think they have to hear what they heard during the campaign, when Barack Obama‘s genius was to speak to Americans who sought change in the country, challenging the entrenched interest.  If he, tonight, says that it is illegal for insurance companies to deny coverage for preexisting conditions, that‘s the beginning. 

But we need to see the possibility in Obama of a great reform president.  The public option is a key element, Ed.  I think Obama needs to speak clearly tonight, passionately, and talk to the American people, those who are insured, under-insured, and not insured, and explain why the public option is in the spirit of American pragmatism, that it is about choice.  It is about competition.  It is about disciplining the insurance companies.  And it is about this cost containment that is so important, it seems, to millions of Americans. 

SCHULTZ:  What‘s the downside if he is judged by liberals tonight as not being strong enough?  You know, there‘s a lot of blog traffic out there.  A, B, and C, he has to accomplish this.  If he doesn‘t, they might run from the movement.  There‘s even talk of a third party if this issue doesn‘t go the way the liberals want it to go.  I want your response. 

VANDEN HEUVEL:  Listen, tonight, Obama needs to stand up and speak with fighting words about how he sees the future of health care.  The progressive movement needs to as it—needs to be as clear eyed and tough and pragmatic about Barack Obama as he is about us. 

He talks a lot about how the perfect is the enemy of the good.  The danger is that the weak will be the enemy of the good, if he doesn‘t move forward on what he has spoken eloquently in the past, the public option.  Those who elected him stood with him because he did challenge the entrenched interests.  The public option is the key element of doing that. 

I think it is way too early to talk about a third party.  We are in the final stages of this game.  As you heard from Senator Sherrod Brown, you have had four good committees come out with four good plans.  Let us build on that.  Let us fight for that.  And let us mobilize from the low to push a leader at the top, as has been the case in all of American history. 

I think Barack Obama, by the way, would be wise to invoke American history.  At every moment of real change and reform in this country, we have seen megaphones of disinformation, as we have seen in these past weeks and months.  Franklin Roosevelt challenged by the American Liberty League.  Johnson challenged by those who thought he was a socialist.  It is time. 

It has been 100 years since Teddy Roosevelt, the Republican, put universal health care in the Progressive Party platform.  It is urgent.  It is time. 

SCHULTZ:  How is the president—if the House passes a strong public option—that‘s his base.  How is he going to be able to run from that and go do a deal with somebody in the Senate and say, OK, we‘ll water it down and go along with that?  Isn‘t he going to have to make a definitive statement, if the House comes out with a strong public option, that he‘s going to have to stand with that?  If he doesn‘t stand with that, he‘s in political trouble. 

VANDEN HEUVEL:  Absolutely.  I think that‘s when we make clear he‘s in political trouble.  Again, I think we have some time here, because, listen, we have one outlier committee, this Max Baucus Finance Committee.  It is the most conservative of the committees.  All of the talk of the Gang of Six, with the three Republicans—you cannot allow even a decent Republican like Olympia Snowe to define the contours of mayor health care reform.  We‘ve seen Enzi and snake in the Grassley.  They have no interest in bipartisanship. 

I think Barack Obama tonight can speak very clearly and rally his own party around the fact that he has tried, but bipartisanship with this party, the Republican party—

SCHULTZ:  And do you think he should call out the Republicans who have been out on the campaign trail spreading information that simply is false?  They have lied to the American people.  Do you think the president should be that strong tonight? 

VANDEN HEUVEL:  I think he needs, as I said, to challenge the lies and the disinformation, fear mongering that has so degraded our political system.  And in doing so, he will explain or work to explain to the American people what is in their interest, and not allow this party, this Republican party, the party of no—it is no longer the party of northeastern moderates.  It is no longer the party that negotiated with Roosevelt for Social Security or Johnson for Medicare. 

This party wants to cripple Barack Obama‘s presidency.  He needs to say that in his words, with passion, with humanity, and with feeling. 

SCHULTZ:  And with directness.  I agree. 

VANDEN HEUVEL:  And clarity. 

SCHULTZ:  Yes.  Clarity is a big word tonight.  Katrina, thanks for your time. 

VANDEN HEUVEL:  Thank you.

SCHULTZ:  Earlier in the show, I asked how you‘re feeling about the president‘s speech tonight; 78 percent of you say you‘re hopeful, 22 percent say you‘re somewhat worried about this whole thing.  I can‘t wait to see how it all comes out tonight.  We‘re going to be back here with a post-game show, 11:00 Eastern time, 8:00 Pacific. 

That‘s THE ED SHOW.  I‘m Ed Schultz.  Live coverage of the president‘s speech to the joint session starts at 8:00 Eastern, right here on MSNBC.  I‘ll be back for the post-game tonight at 11:00.  “HARDBALL” is next, right here on the place for politics, MSNBC. 

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