updated 10/6/2009 11:10:29 AM ET 2009-10-06T15:10:29

COUNTDOWN

October 5, 2009

THIS IS A RUSH TRANSCRIPT.

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

Guests: Dr. Paul Hochfeld, Margaret Carlson, Marisa Guthrie

(BEGIN VIDEOTAPE)

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

Is there a doctor in the house? While Max Baucus goes into another stall, the president turns to stagecraft.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: You took an oath so that you could heal people. You did it so you could save lives. The reforms we're proposing to our health care system will help you live up to that oath.

(END VIDEO CLIP)

OLBERMANN: The oath of Baucus? Give the Republicans and the insurance monopoly all the time they can find to delay reform longer. His committee members to get time to study the Congressional Budget Office numbers not due out until late this week.

Congressional Republicans to Michael Steele: back off-the GOP in-fighting over policy. And Lindsey Graham throws "Lonesome Road's" Beck under the bus-again.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM ®, SOUTH CAROLINA: He doesn't represent the Republican Party. You can listen to him if you like. I choose not to.

(END VIDEO CLIP)

OLBERMANN: And about the other fake populist? The senior campaign strategist for McCain/Palin throws Palin under the bus-again.

(BEGIN VIDEO CLIP)

STEVE SCHMIDT, FMR. MCCAIN/PALIN STRATEGIST: She would not be a winning candidate for the Republican Party in 2012. And, in fact, were she to be the nominee, we could have a catastrophic election result.

(END VIDEO CLIP)

OLBERMANN: And sportsmanship. They already had an act of kindness planned for a high school football player leaving to fight cancer when one coach decided to go even further.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Coach called a time-out, comes walking across the field and said, "Let's get him a touchdown." I started crying.

(END VIDEO CLIP)

OLBERMANN: And the David Letterman story-what's new? Well, I could write you a screenplay. It's tough when you know one of the people in the news story. I know both these guys.

All that and more-now on COUNTDOWN.

(END VIDEOTAPE)

OLBERMANN: Good evening from New York.

If you believe that your lone surefire way to protect your health insurance would be to go work for a giant health insurance company-sorry. WellPoint, the nation's largest health insurance company, announcing that besides layoffs, it will be raising premiums and deductibles for some health benefits of its employees.

But WellPoint is holding firm on one point. It wants an 18.5 percent rate hike on policyholders in Maine. And since the state has blocked that, WellPoint is now suing Maine.

Our fifth story on the COUNTDOWN: The Senate and the White House would trust health insurance companies to police themselves in fixing their own ailing industry-why?

President Obama welcoming 150 doctors, each clad in their white coats, representing every one of the 50 states, to the Rose Garden this morning. A recent NPR poll of doctors at Mt. Sinai School of Medicine in New York is showing that 63 percent of them give patients a choice-favor giving patients a choice that would include both public and private insurance. Another 10 percent of those doctors are saying they would like a single-payer public system, Medicare, for everybody.

The president is saying they are the professionals who have the most credibility on this issue.

(BEGIN VIDEO CLIP)

OBAMA: We have listened to every charge and every countercharge-from the crazy claims about death panels to misleading warnings about a government takeover of our health care system. But when you cut through all the noise and all the distractions that are out there, I think, what's most telling is that some of the people who are most supportive of reform are the very medical professionals who know the health care system best: the doctors and nurses of America.

(APPLAUSE)

OBAMA: Every one of you here today took an oath when you entered the medical profession. It was not an oath that you would spend a lot of time on the phone with insurance companies. It was not an oath that you would have to turn away patients who you know could use your help.

You did not devote your lives to be bean counters or paper pushers. You took an oath so you could heal people. You did it so you could save lives.

(END VIDEO CLIP)

OLBERMANN: Senate Republicans claiming that not all medical professionals support the president on this issue. Senator Barrasso of Wyoming, an orthopedic surgeon, is saying that many doctors and nurses are greatly alarmed at proposed cuts in Medicare.

Others who act like Republicans who still call themselves Democrats, Senator Blanche Lincoln, for instance, telling "Roll Call" that she's all for public options so long as it is not a public option. Ostensibly so she can sell it back home in Arkansas. Her quotes, "I'm not supportive of a government-run and government-supported public option." That would be the definition of a public option. She adds, "It's got to be competitive. It's got to create choice for people." Choice is optional.

Last month, 55 percent of those people in her state surveyed by Research 2000 for Daily Kos in favor of a public option.

Senator Lincoln, one of three Democrat who have voted against the public option on the finance committee. Senator Lincoln, Chairman Baucus, and the rest of the committee supposed to vote on its health care bill tomorrow. Now, it's looking like that might not happen until next week because the Congressional Budget Office is not expected to complete its assessment of whether the bill would add to the deficit until the end of this week.

Why put off only until tomorrow what you can delay until next week?

More on the doctor's White House call in a moment.

First, we'll turn to Howard Fineman, senior Washington correspondent for "Newsweek" magazine.

Howard, good evening.

HOWARD FINEMAN, MSNBC POLITICAL ANALYST: Hi, Keith.

OLBERMANN: The president said he would not sign a bill that was not budget neutral at minimum. What happens if the Congressional Budget Office comes back and says, "Wait a minute, this piece of legislation is going to cost money"? Where will this process be then?

FINEMAN: Well, first, let's explain why that might happen-and I think it might happen. It's because the finance committee bill, the Baucus bill, doesn't really have the employer mandate in it and doesn't have the public option. Which means it wouldn't cover nearly as many people as some of the other bills would.

So, in order to make sure that the bill would cover more people, there's more spending there, there are more subsidies in there, and there are more tax breaks for people. There are more ways to encourage people who can't pay to get the coverage they're required to get, to get it. That may be costly and that may cost more than the Baucus committee estimated.

I'm told by Senate Democratic leaders that I talked to that there's some, quote, "wiggle room" in the Baucus bill. But what that might mean is, after they get the CBO number back, if it isn't a number they like, you get yet another chance for even more delay.

OLBERMANN: And speaking of wiggle room, there's wiggle room on the other end. The "Los Angeles Times" reported today the president's trying to shore up support for some form of a public option.

If you put that together with the Lincolnian definition of a public option out of Arkansas, are we still talking about something that we've titled a public option but has neither public in it nor offers any choice?

FINEMAN: I think that's possible. It's not likely. And matter of fact, probably required in order for-to be a final bill.

What I'm told-I talked to two Democratic senators just a little while ago, what they told me is they're looking at a state by state option for a public option. In other words, it would be up to individual states and there might even be a trigger built in. We're back to triggers. So you have a trigger with a state-by-state option that might be watered down even further.

The trick of this whole thing is going to be to water the public option down enough to make sure that this thing can pass the Senate at some point. Because everybody who counts votes says that it's a very difficult thing to get every Democratic senator, including Blanche Lincoln and some others, to vote for it, if it has a real public option in it.

OLBERMANN: Yes. The Lord knows it's more important to pass a bill than to have anything in the bill.

FINEMAN: Yes, exactly. Exactly.

OLBERMANN: The thing with the doctors in the Rose Garden this morning, was that the president trying to frame the message ahead of this next critical phase of this debate, which really would be pretty much a first for the president and his supporters on this side of the equation?

FINEMAN: Yes. Yes. I think he's trying to get out ahead. Whether this is necessarily the right way to do it-you know, it certainly doesn't hurt to be surrounded by doctors. They still have very high approval rating overall.

But people are pretty sophisticated and know that doctors-a lot of doctors are part of the health care systems that are both a solution and a problem to some extent. So, it's a little more complicated than that.

I think what the president needs to do is not another photo op. He needs to get out there and he needs to publicly twist some arms in the same or definitively what he wants. He's still not doing that.

OLBERMANN: But, of course, when you see doctors en masse like that endorsing something, the old commercial comes up. Three out of four doctors prefer.

FINEMAN: Three out of four doctors.

OLBERMANN: Well, three out of four doctors are for either the public option or.

FINEMAN: Yes.

OLBERMANN: . this stronger thing which is single-payer.

FINEMAN: Yes.

OLBERMANN: Health insurance companies right now proving at the time

of the debate they can't be trusted to police themselves. They're cutting

cutting the benefits to their own employees. Why am I cynical about the ability of these facts to break through all this noise?

FINEMAN: Well, because, as I said, the president-I don't think has been sharp enough. I don't think he's been definitive enough. I don't think he's been public enough in what he really wants. There's all this talk about how they're going around behind the scenes pushing the public option.

Look, if he really wants it, he needs to say it more directly, have the doctors standing behind him if he's going to do it. You know, his personal physician back in Chicago is somebody who's very much in favor of the public option. You don't hear anything from that guy. You know, he's not-he's not-I don't even know if he was in the Rose Garden today-probably not.

OLBERMANN: It's doctor/patient privilege or patient/doctor privilege.

FINEMAN: Exactly.

OLBERMANN: Howard Fineman of MSNBC and "Newsweek"-as always, thank you, Howard.

FINEMAN: Thank you, Keith.

OLBERMANN: About the feelings of physicians, I'm joined now by Dr. Paul Hochfeld, an emergency medical physician from Corvallis in Oregon, and a member of Mad as Hell Doctors. His organization was not invited to the event today at the White House, but Dr. Hochfeld believes his group should be represented so he showed up anyway, and was able to talk his way inside.

Dr. Hochfeld, thanks for your time tonight.

DR. PAUL HOCHFELD, EMERGENCY MEDICAL PHYSICIAN: Good evening.

OLBERMANN: First of all, what exactly is Mad as Hell Doctors mad about, or are mad about?

HOCHFELD: Well, we're some Oregon doctors, members of PNHP, who were dismayed and distressed that the health care reform debate that wasn't going on in Washington. There was a debate between a failed individual mandate with or without a wounded public plan.

But what I'm really mad about and what we're mostly mad about is not health care; what we're mad about is that our legislatures were really complicit with the industry-the insurance industry in manipulating public policy so that it's more about profits than public good. And that's what we're seeing with this health care bill that's coming out of Congress right now, or appears at least to be making it up the floor of Congress, it's this individual mandate.

And it really is incremental change that isn't going to shift the power of the industry in this health-in this sick care non-system that we've got.

OLBERMANN: This issue of the public option and the idea that it might get in name only or in watered down form, let alone the idea that the single-payer went out the window months ago, before even the debate started or the compromising started, how do you feel about the status of the public option?

HOCHFELD: Well, if we had a real public option that really competed

on a level playing field, it may be a way to move towards having a real

health care system. I would call it not watered down, I would call it

wounded. The public plan option that we're going to get from this Congress

since it's basically written by the industry, using our legislatures-is designed to fail. It's designed to attract the sickest, most expensive patients, and that's called adverse selection. And adverse selection is the death knell to any insurance company and the plan is just another insurance company.

So, after it comes online in 2013 and it starts to fail in 2016, at which point we're spending, what, 20 percent of our GNP on health care? The industry's going to look at this designed to fail public option and say, see, the government can't do health care, and it will just be the wrong lesson. The government can do health care. Just look at the V.A. They've got excellent results, great patient satisfaction, very cost effective.

Now, is it adequately funded? No. But it produces a tremendous amount of help for the amount of money that they're spending. And that's the whole point. We need to have a health care system that's designed and operated to get the most help we can for our health care dollars.

Right now, we're wasting 20 percent of all of our dollars servicing an insurance industry.

OLBERMANN: That's right.

HOCHFELD: . that adds nothing to the quality of the product, which is supposed to be health.

President Obama himself said on Wednesday night, a few months ago on national television, if you want true universal access, you're going to have to have single-payer. And I think that's true. The only way we're ever going to have true universal access, which is a moral imperative, is to get some savings in the system, 20 percent right off the top, and now, we can cover everybody.

And then we'll have a system so we can deal with all the other drivers on cost, which include some of the physician behaviors, because of the perverse incentives.

OLBERMANN: Right.

HOCHFELD: . that encourage us to do more and more and more and more.

OLBERMANN: Last point-we know the doctors were not there-the ones on camera there were basically not speaking on camera. They were more or less props for that imagery from the Rose Garden this morning. Were any of you-or were you collectively able to talk to the president about this?

HOCHFELD: None of us talked to the president, as near as I can tell. But I talked to as many of those physicians as I possibly could. And I wasn't actually invited to the meeting. I just showed up at the gates and managed to get in.

And virtually, everybody-the vast majority of the physicians I spoke to-and I must have spoken to at least a couple dozen of them, want what I want and understand what I understand, which is that our health care system is profoundly broken, that we're wasting a tremendous amount of money servicing the insurance industry, and that single-payer is actually the best solution to this problem.

The difference between them and me is they think we're only going to get incremental change from this Congress. And I don't think incremental change is going to change the balance of power. I think we need real change. And I think this is the civil rights issue of our generation and we have to start every discussion with access to appropriate health care is a human right.

OLBERMANN: Hence the term Mad as Hell Doctors, entirely appropriate.

Dr. Paul Hochfeld, great thanks for your time tonight. Good luck with your efforts.

HOCHFELD: Thanks for having me.

OLBERMANN: As the fight for health care reform reaches this critical

time, I have a brief programming announcement. Wednesday night here, we

will devote the entirety of COUNTDOWN to special comment. On the need for

reform, the real meaning of reform, and the protest against it, and what we

you and I-can do about it. I will propose group action by patients.

By which we might yet reclaim this debate from the corporation and the political foot draggers among us.

A program, "Special Comment," Wednesday night here on COUNTDOWN.

We have covered the Democrats versus the Democrats, the Republicans versus the Democrats. In Republicans versus Republicans news, Lindsey Graham repudiates Glenn Beck again. Another McCain campaign official repudiates Sarah Palin again. And everybody repudiates Michael Steele again.

(COMMERCIAL BREAK)

OLBERMANN: The GOP's internal battle over policy. Michael Steele accused of making some when he damn well knew the Republicans weren't supposed to have any. Sarah Palin accused of adhering too closely to that maxim. Glenn Beck accused of unduly influencing it.

And the feel-good story of sports this year.

Plus, as the Letterman saga continues, finally some background of the man accused of the blackmail scheme from someone who once worked with the accused extortionist. That's me. Hi, how are you?

(COMMERCIAL BREAK)

OLBERMANN: Eleven months after election day left Republican politicians without a leader or the power to make policy, Republican politicians are upset with their leader for making policy.

Our fourth story tonight: It gets less confusing, not to mention a lot more funny when you hear the details. You probably don't remember, but in August, Republican Chairman Michael Steele unveiled his "senior's bill of rights." The next month, in the office of House Republican leader John Boehner, reports "Politico," the party's top elected leaders told Steele to stop making party policy.

"Politico" quoting two unnamed people in the room saying Steele was taken aback-his usual position. Of course, policy itself was not the issue, why start now? But rather, the question was: who makes the policy? Steele responding, says "Politico," saying he gets asked around the country where the GOP stands on a range of issues and he needed some answers.

Steele today said he does not do policy, and Republicans on the record said, everybody made nice. Anonymously, a top GOP House leadership aide also told "Politico" that Steele is, quote, "on a short leash." And whatever you think of the appropriateness of that phrasing, its accuracy seems in doubt as the GOP Web site still has "seniors' bill of rights" on full display.

A search for a party leader goes on, however. Glenn Beck's leadership, like Steele's, also now taking fire. Beck responding on Friday to criticism from Republican Senator Lindsey Graham saying, quote, "Lindsey Graham hating my guts is probably the highest honor I've ever received," which sounds about right actually.

Yesterday, Beck enabler, "fixed news," pushed back at Graham, asking him, quote, "Are you saying that Glenn Beck is bad for America?"

(BEGIN VIDEO CLIP)

GRAHAM: I'm not saying he's bad for America. You've got the freedom to watch him if you choose. He did a pretty good job on ACORN.

What I am saying, he doesn't represent the Republican Party. You can listen to him if you like. I choose not to, because, quite frankly, I don't-I don't want to go down the road of thinking our best days are behind us.

We need to act decisively. People are genuinely upset with how much money we're spending up here. But at the end of the day, when a person says he represents conservatism and the country's better off with Barack Obama than John McCain, that sort of ends the debate for me as to how much more I'm going to listen.

So, he has a right to say what he wants to say. In my view, it's not

it's not the kind of political analysis that I buy in to.

(END VIDEO CLIP)

OLBERMANN: Let's turn now to MSNBC political analyst, Richard Wolffe. Author also of "Renegade: The Making of a President" and a senior strategist at Public Strategies.

Good evening, Richard.

RICHARD WOLFFE, MSNBC POLITICAL ANALYST: Good evening, Keith.

OLBERMANN: "Politico" quotes this unnamed associate of Steele saying the party's leaders in Congress, including the top aides still have what "Politico" calls "lingering resistant" to fully accepting Steele. And the top-another top aide gave that "short leash" quote.

What are we hearing there? Is that at one end, possibly a little of the latent racism in the GOP? Or is it more that conventional version by any Republican to listen to anybody but themselves ever?

WOLFFE: Well, look, it's certainly been clumsy politics. And, you know, today, Michael Steele says he doesn't do policy. Tomorrow, he'll say he doesn't do politics either. So, the poor guy's got no leash. It's not even a short leash.

And to get to the race question, you have to understand that party's calculation of putting him there in the first place. It was a simplistic and crude equation they made. That to cover themselves against any accusations of racism-and, boy, it's not hard to find they-they needed to have a black figure going up against an African-American president. And they didn't have many people to choose from with this token gesture. So, they had to choose someone who plainly wasn't ready for prime-time.

All of that's being played out now because it turns out, irony of ironies, they don't even need any cover. They can be as outrageous as they like and portray the president as a witch doctor and they get on FOX News. So, everything's fine. They didn't need the cover of Michael Steele.

It's just ironic that for a party that always complained about quotas and affirmative action, they have found themselves with one.

OLBERMANN: Well, they did the same thing with Sarah Palin as the alternative to Hillary Clinton, which grows increasingly laughable with the passing day.

WOLFFE: Because it looked so easy.

OLBERMANN: Yes, exactly.

WOLFFE: They made it look easy.

OLBERMANN: If it's too easy, as they say, that usually means it's usually too easy or seems too easy. What is, though, the power dynamic within the GOP, Boehner and the Republican leader in the Senate, Mr. McConnell are they Steele's bosses? If they don't have policy, can they really stop Steele from making stuff up on behalf of the Republican National Committee?

WOLFFE: Well, they can't really stop him. And it's interesting, the comparison some people have drawn with Howard Dean of the DNC. He obviously had a very difficult relationship with Harry Reid and Nancy Pelosi.

But there is a world of difference here. And the difference here is that this isn't an ideological split in the sense that Dean represented, as he called it, "echoing Paul Wellstone," the Democratic wing of the Democratic Party. And he has this whole policy hinterland that Michael Steele doesn't.

It's not that Michael Steele represents the Republican wing of the Republican Party; he represents an African-American Republicans view from Maryland of what politics should be. The reason he goes out there and defends Medicare is because that's where the center ground is. It's the government plan, lo and behold.

So, you know, it's not that he represents the wing. He is trying to move the party in a position that it doesn't want to go to.

OLBERMANN: What's the Graham/Beck thing about? Because if Republican officials keep claiming that somebody else is leading-or the leadership mantel does not belong to Beck, it does not belong to Limbaugh, it does not belong to Palin, aren't they-since there's nothing to hit, to replace the vacuum that they, again, create time and time again here, don't they really just confirm that Beck and Palin and Limbaugh are virtually the leaders?

WOLFFE: Well, part of the problem is that they are indeed a headless body. But the other part is they're afraid that one of these media figures is going to take this party apart and launch their own bid. A third party bid.

And, you know, Glenn Beck is going to be very happy to take Republican establishment criticism because I-I've said this for some time on this show-if there is going to be a demagogic figure leading a third party run next time around, it's going to be someone like Glenn Beck. So hold on to your hat.

OLBERMANN: I believe there's only the one someone like him. Let's not find out.

Richard Wolffe of MSNBC, author of "Renegade" and also senior strategist at Public Strategies-again, great thanks, Richard.

WOLFFE: Thank you, Keith.

OLBERMANN: Sarah Palin, faring no better tonight-thrown under bus by yet another key McCain campaign advisor. Friday, one of them called her potential candidacy a catastrophe. Today, somebody else used the term an apocalypse. Put them together and it's the Palin catastro-pocalypse.

And a high school football coach tries to do something nicer for one of his players after a cancer diagnosis, only to find out that the other team's coach was trying to do something nicer for him-next.

(COMMERCIAL BREAK)

OLBERMANN: Normally, it's a break here from the madding crowd of politicians. We do an anniversary on "Oddball" and "Best Persons." But tonight, a different kind of break-a simple "restore your faith" story that I was privileged to bring you first last night on "Football Night in America." Despite all the self-absorption and rule-breaking in sports, the old fashioned concept of sportsmanship is to some degree back in vogue.

Last year, a college softball player hit a game-winning home run only to tear up her knee. She rounded first base so two of her opponents whom she had just beaten picked her up and carried her around the bases.

This year, in Ithaca, New York, six high school cross-country runners wandered off the course when they finally found the finish line. Though none of them were friends, they agreed to cross in the same order they had been in when they got lost.

Then there was what happened in a high school football game a week ago Saturday in Torrington (ph), Connecticut. To coaches agreed on a caring gesture for an ailing player. But it turned out that was only the start of the sportsmanship.

(BEGIN VIDEOTAPE)

NICK REARDON, HIGH SCHOOL FOOTBALL PLAYER: I wasn't really upset about the cancer or anything. It was just the fact I couldn't play football. It wouldn't have been bad if I could keep playing football through it. I guess they don't want me doing that. I'd go out there and play right now if I could.

OLBERMANN (voice-over): Nick Reardon, who will turn 17 years old a week from Thursday, has testicular cancer. A linebacker, offensive guard, and the punter for the Wolcott Tech (ph) Wildcats. The game against the Avon Falcons was to be his last in uniform, before nine weeks of intense chemotherapy began.

He couldn't play. Doctors would not let him risk getting hit. But Nick's coach, Jamie Coty, had a wonderful idea. If it's the fourth quarter and the game's decided, Cody asked Avon coach Brett Quinion (ph), just before kickoff, can I put him in to punt and have you not rush?

Quinion didn't hesitate. Absolutely, he said. Seven turnovers later, Nick and Coach Cody and Wolcott Tech were down 42-0. When Coty saw Avon coach Quinion gesture towards him.

JAMIE COTY, HIGH SCHOOL FOOTBALL COACH: Coach Colts call a time-out. Comes walking across the field. Said, let's get him a touchdown. I started crying. I put Nick in the game.

REARDON: I didn't know it was fake. Everybody else did. I didn't.

When the line opened up, I just went for it. Got my touchdown.

OLBERMANN: With his best friend since elementary school, Kyle, leading the blocking for all 82 yards and the other Wolcott Tech and Avon players fighting each other to get a better view of the play, Nick got his touchdown. And two teams celebrated in one end zone.

REARDON: Just a glorious feeling. I mean, you got your entire team behind you, supporting you through everything, whether it's chemo or running in a touchdown. They're like my family. I love those guys.

OLBERMANN: On Monday, when Wolcott Tech went back to practice, reality hit again. Nick's chemo began. And then reality would be sacked yet again. When the Wildcats gathered later in the day for a film session, there was Nick, sitting through some tough images of a 49-6 loss just like anybody else on that team.

Well, tough images, save for one touchdown.

(END VIDEOTAPE)

OLBERMANN: Nick Reardon still attending practice, despite the chemo, and despite the fact that he can only watch. Wrong about all this in one detail only. I didn't know it was a fake, he said of his touchdown. Nick, that was no fake.

"A political apocalypse," that is what a Sarah Palin presidential nomination could be in 2012 according to who? Really? Next.

(COMMERCIAL BREAK)

OLBERMANN: The number one prospect for the Republican presidential nominee in the year 2012 is an unemployed blogger who quit her job so she could spend more time on Facebook, and still had to hire somebody else to write her book for her. Our third story tonight, if you consider the prospect of half Governor Sarah Palin running for president three years from now a political apocalypse, unquote, you're not a terrorist, palling un-American Pink-o, Charlie. You're one of several top political advisers to Republican Senator John McCain.

Now it is John Weaver telling the "Washington Post" he is almost sure Palin would never win his party's nomination. And that if she did, quote, "it would surely mean a political apocalypse is upon us."

In fact, using special effects, we can even simulate in visual terms exactly what kind of political apocalypse the Republican party would have to look forward to in 2012. Weaver was reacting to an only slightly less dire prediction from another McCain campaign vet, his campaign manager Steve Schmidt, who was asked about Palin 2012 on Friday.

(BEGIN VIDEO CLIP)

STEVE SCHMIDT, REPUBLICAN STRATEGIST: My honest view is that she would not be a winning candidate for the Republican party in 2012. And, in fact, were she to be the nominee, we could have a catastrophic election result.

(END VIDEO CLIP)

OLBERMANN: Palin, of course, in the news right now thanks to her number one book, a book that became number one thanks in part to right wing groups books buying it in bulk on pre-order, and planning to give it away as part of a promotional vehicle.

Let's turn now to Margaret Carlson, political columnist for "Bloomberg News," and Washington editor for "The Week Magazine." Margaret, good evening.

MARGARET CARLSON, "THE WEEK MAGAZINE": Good evening, Keith.

OLBERMANN: If you put the Schmidt and Weaver quotes together, you get catastrophic apocalypse or catastro-pocalypse. Can you put this into some sort of context for us? What does it take? How often has this ever happened before for Republican operatives to sort of break rank three years in advance and savage a former running mate like this?

CARLSON: Well, it doesn't happen that often. Steve Schmidt did this at the Washington Ideas Forum. I was there. He does not do it with glee. It would be in his interest to push Sarah Palin, in that Republicans like to do things in an orderly fashion, and Sarah Palin would be next in row to run for president, since presumably, at 76, John McCain will be too old to run.

So he's not doing it out of self-interest. It is out of having been

very, very close for a number of months. No other political strategist has

been that close. And concluding that she's not fit to run, and that doing

putting her forward would injure the Republican party, as he said, catastrophically.

OLBERMANN: But are they right about this on some sort of objective level? Or is this just sniping by two sides around a massive schism, like Goldwater people versus Rockefeller people in '63 and '64?

CARLSON: Well, they'd like a Rockefeller kind of person. Some Republicans would like a Rockefeller type to run, because while they have some passion on the right in Sarah Palin, they don't have any passion in the middle, or a passionate middle candidate, to attract the voters that they were sorely lacking in the last election.

If Steve Schmidt and John Weaver and others had a candidate in front of them, I think they would, you know, be happy, but they just don't. Having-you know, in a piece in "Vanity Fair," Steve Schmidt was quoted as calling Sarah Palin a mental case. And trying to get her ready for the debates, she would take no advice whatsoever. And only for-towards the end, only from her family. She would only speak to members of her family who had never been in a debate before.

OLBERMANN: Mr. Schmidt has also reportedly said that Mrs. Palin has not done anything since last year to broaden her base. You know, as if quitting a job isn't doing something. But if he's right, what, if anything, could she do to broaden her base?

CARLSON: Well, candidates often retreat, study, get in touch with the leading thinkers in their party. I mean, she could go to Cato or Heritage. There are any number of them. She could seek out foreign policy experts.

There's always been an anti-intellectual streak, actually in both parties, the populism of both parties. Sarah Palin seemed-but lots of times the candidates are faking it. They're actually quite intelligent and have gone to Ivy League universities and a whole bunch of other things. Sort of they fake it.

But Sarah Palin seems genuinely committed to knowing as little as possible.

OLBERMANN: Well, she's doing a great job. Listen to me, I'm complimenting her. She's doing a great job of that. Margaret Carlson of "Bloomberg News" and "The Week Magazine," thank you, Margaret.

CARLSON: Thanks, Keith.

OLBERMANN: This question about the David Letterman story, if this were about a not very famous comedian, wouldn't the story be CBS News producer arrested on charge of blackmailing comedian? Calls for CBS News to investigate itself?

A resident of his state tells a Georgia Congressman he tried to kill himself and was prescribed medicine he could not afford. So Congressman Paul Brown says, you should go to an emergency room.

And when Rachel joins you at the top of the hour, treason, in effect, of the GOP. First a Congressman tells China, we're not good for our debts. Then a senator tries to go to Honduras to meet with a government we don't recognize. Now Senator Inhofe is going to Copenhagen to deny the existence of climate change.

(COMMERCIAL BREAK)

OLBERMANN: The David Letterman saga overshadowing what otherwise would be a journalism scandal of Biblical proportions. What do you mean a CBS news producer try to extort two million dollars from Letterman? What do you mean I used to work with him?

That's next, but first time for COUNTDOWN's number two story, tonight's worst persons in the world.

The bronze to George Will, who has written his seventh climate change denying column of the year for the "Washington Post," claiming that because there has not been any significant warming since 1998, climate change has stopped. The folks at Think Progress wrote last Friday that this was like looking at only the last ten days of the baseball season to decide who had won the pennant.

Their quote, "by this logic, we'd have to conclude that the Toronto Blue Jays just clinched the AL East Division title. After all, they won six games in a row and are nine and one in their last ten games, while the New York Yankees lost their last game and are only seven and three."

Think Progress contacted the noted baseball historian, Mr. Will, for his response, which was, quote, "you don't seem to understand baseball. The Blue Jays are not even in contention."

Yes, that's the point. They're not even in contention-forget it.

Look at me, I'm arguing with a super-intelligent garbage compactor.

Runner up, Boss Limbaugh, once again reducing the world to cliches he and dumb people like and can easily understand. The subject this time, the Olympic vote. "Obama cannot win in a fair vote. The only thing missing in that vote over there today was Acorn. If had a Acorn representation stuffing ballot boxes, registering fake IOC members, then maybe Chicago would have had a chance. Obama couldn't do that. Couldn't get Acorn over there. See, Obama doesn't debate people. He clears the field."

Do you know anything about the Olympics? About the fact that the International Olympic Committee and the U.S. Olympic Committee have had more disputes between them than, say, we do with Fox News, that we may not see the U.S. get the games again in our lifetime over fights over TV rights and marketing fees that would still be there even if Lyndon Larouche were president?

I'm tempted to ask you, sir, not to talk about things you don't understand, but if I did that, your show would be three hours of silence.

But our winner, Congressman Paul Brown of Georgia. At a town hall, a man from Athens, Georgia said he had tried to kill himself. He was then diagnosed with major depressive disorder and prescribed medicine, for which he went into 1,700 dollars worth of debt before he had to stop buying it.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: For the last two years, I've lived in misery because I can't afford insurance for this disease I've been diagnosed with. I just want to share what it's actually like here. Thank you.

REP. PAUL BROWN ®, GEORGIA: Depression is a horrible disease. I've treated a lot of that in my career. And the thing is, people who have depression, who have chronic diseases in this-in this country, physicians are treating folks. People can always get care in this country by going to the emergency room.

The question is, can everybody have access to health care in this country. The question is who pays for it? Where do they get it? And at what cost?

Going to the emergency room is the most expensive way of trying to deliver health care.

UNIDENTIFIED MALE: That's why we need a public option.

(END VIDEO CLIP)

OLBERMANN: Emergency room treatment for depression? Like two Aspirin for cancer. Congressman Brown is, by the way, according to his resume, a doctor. A, I fear for his patients. B, damn it, I want to see his diploma. Congressman Dr. Paul "Hippocratic Oath, what Hippocratic Oath" Brown, today's worst person in the world.

(COMMERCIAL BREAK)

OLBERMANN: A CBS guy was arrested. It's the guy he's accused of blackmailing who some critics think needs to be investigated. The alleged blackmailer is not talking. It's the target who will on his show tonight say, "I want to apologize one more time to the former governor of Alaska." The confessed ladies' man saw his ratings jump 38 percent the night after the confession. As if we weren't already upside down enough on this story, I first met David Letterman in 1996, but I spent about a year working with Robert J. Joe Halderman at CNN, beginning in 1981.

Our number one story tonight, Halderman, 27-year veteran of CBS News, before that assignment editor at CNN in New York, where I was the sports reporter, and this network's president, Phil Griffin, was the sports producer, defended today in several venues by his attorney, Gerald Shargel (ph). On "The Today Show" and elsewhere, the attorney tried to define Halderman's character, citing the opinion of co-workers and the Halderman trophy case.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The thing about Joe Halderman as a person-and those who know him think about Joe Halderman, they think about how unlikely this is. People like Dan Rather, people who have worked with Joe Halderman at CBS for 27 years. He's been there for more than half his life. He's an Emmy award winning journalist.

(END VIDEO CLIP)

OLBERMANN: Yes, there's no personal credential issue in the Emmys. They give them to anybody who wins. Also for Mr. Shargel, "I'm here to say, not so fast. I look forward to cross examining David Letterman, because I don't think the full story is before the public. There's much more to the story."

Yes, Halderman did deposit a two million dollar check from Letterman, but, quote, "the surrounding circumstances are what's relevant."

From an anonymous neighbor of Halderman's in Norwalk, Connecticut to the "New York Daily News," quote, "any encounter I've had with him has been unpleasant. He thinks because he's a TV executive that he can treat people like dirt."

At the recording of tonight's show, Letterman apologized to his wife and his staff, and thanked those on his show for, quote, "once again putting up with something stupid I've gotten myself involved in." Before the apologies, there were a few jokes.

(BEGIN VIDEO CLIP)

DAVID LETTERMAN, "THE LATE SHOW": Did your weekend just fly by? I mean-I'll be honest with you, folks, right now, I'd give anything to be hiking on the Appalachian Trail.

I got into the car this morning and the navigation lady wasn't speaking to me.

(END VIDEO CLIP)

OLBERMANN: Joining me now is Marisa Guthrie, programming editor for "Broadcasting and Cable Magazine." Thanks for coming in tonight.

MARISA GUTHRIE, "BROADCASTING AND CABLE MAGAZINE": Thank you, Keith.

OLBERMANN: The calls on this publicly have been CBS should investigate Letterman. I'm missing something in this equation. There was a guy who works for CBS who was investigated. Isn't there some reason to be looking into whether or not CBS News was somehow connected to this? Or if a man's been working there for 27 years and winds up getting arrested in exchange for squelching basically a news story, wouldn't somebody say, well, don't know that there is evidence this has happened before; we need to investigate that process, as much as you need to investigate whatever Letterman's done, right?

GUTHRIE: This has put CBS in an extremely difficult position. It's surreal for them to be covering-reporting on one of their anchors-one of their producers and one of their biggest stars. I think employment lawyers will tell you-and they most certainly have to be launching an investigation into both of-both Letterman and Halderman to find out exactly what went on.

OLBERMANN: Dan Rather, who I know and like very much, defended Joe. And I knew him 26, 27 years ago. When I knew him, he was as talented as anybody I've worked with, supernaturally so almost. The Emmy awards and everything else didn't surprise me. His success didn't surprise me in the slightest.

But somebody asked me about this man the other day. And I said, if you gave me a list of 250 people I have worked with, and said one of these people has been accused of doing this, I know he would have been at least on my list of top five candidates of the people that I knew. And then the "New York Observer" quoted somebody identified as only a associate. Let me read it directly out of the paper: "if you said which CBS News producer would be caught up in this thing, he would have been one of the first people to come to mind. His personality is one that pushes the envelope. As a breaking news producer, that's what you need, but you could see how he would be living on the edge a bit."

And Marcy Maginnis (ph), the former CBS executive said, it sounds to me like a nervous breakdown of some sort.

GUTHRIE: Right.

OLBERMANN: There are a lot of answers in here. Do we know, are they all right? Are parts of all them right? Or what?

GUTHRIE: I think people who did what Halderman did, working at those fireman's bureaus that he worked at in London, where they're parachuted into hot spots and war zones, take a lot of risks. You have to to do that job. They're shot at. They're mock executed. They're kidnapped.

So you start to live that life. And, you know, anything else probably seems rather mundane.

I don't know Mr. Halderman. A lot of people that come back from doing that job suffer PTSD. And that has all-has effects on marriage, et cetera. So everyone who's worked with him finds this incident extremely bizarre.

OLBERMANN: The other thing, of course, is if you survived all that, you begin to think you can survive almost anything, when maybe the people who did not last in the business, for whatever reason, have left for safer ground. You think you own that territory, I guess.

GUTHRIE: Well, yes, you have-maybe you feel like you have nine lives.

OLBERMANN: Yes. About David Letterman. First, is it not well known that 90 percent of men who go into television do so to impress women? And at comedy clubs, the figure is 100 percent? Isn't that sign still hanging there?

GUTHRIE: Is that why you went into television, Keith?

OLBERMANN: Perhaps originally it was one of my motives. But I thought there was a sign at every comedy club in America that said, do not feed the comedians.

GUTHRIE: I don't think a lot of people go in to foreign news producing to attract women. It can be-I think being the boy Friday to an anchor star can be kind of castrating.

OLBERMANN: But the Halderman lawyer is the one part of this that I really don't understand. I think I have a handle on the rest of the equation. What is it with the wait until I cross examine Letterman defense? That doesn't seem to be any explanation offered of what his client did, just what he's going to do on the stand himself.

GUTHRIE: You know, Shargel's very shrewd. I think though what he's trying to do going on all the morning shows today, talking about how upstanding his client is, is wrest control of the message back from Letterman. Letterman got out ahead of it. And he framed it himself. He's the victim. And Shargel is trying to say, well, wait a minute here, and try to depict Letterman as, you know, some skivvy guy having lots of office affairs with women half his age.

I don't know how you-how that works for you as a legal strategy.

OLBERMANN: Yes, exactly.

GUTHRIE: As a public relations strategy, that seems to be what he's doing.

OLBERMANN: What does it have to turn into? Because it clearly isn't that. His ratings were up 38 percent after the first night. What does it have to turn in to genuinely damage David?

GUTHRIE: I think more-if unsavory details come out, besides just the fact that he was having these affairs, and advertisers start to get squeamish and start to go away, then that will be a big problem for CBS. I mean, we don't know what kind of details are going to come out yet about Letterman or Mr. Halderman.

But, you know-and Letterman's audience is 58 percent women. So I think he humanizes himself a lot tonight, when he talks about being in the dog house with his wife. And I think a lot of people can relate to that.

OLBERMANN: Marisa Guthrie of "Broadcasting and Cable Magazine," thanks for coming in again.

GUTHRIE: Thanks for having me.

OLBERMANN: That's COUNTDOWN for this the 2,349th day since the previous president declared mission accomplished in Iraq. The programming reminder, this Wednesday, we'll devote the entire hour of COUNTDOWN to a special comment on health care reform in this country, the real fear preventing its implementation, and what you and I can possibly do about it.

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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