updated 10/27/2009 10:31:25 AM ET 2009-10-27T14:31:25

COUNTDOWN

October 26, 2009

THIS IS A RUSH TRANSCRIPT.

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

Guests: Sen. Chuck Schumer, Arianna Huffington, Chris Hayes, Richard Wolffe, Susie Essman

(BEGIN VIDEOTAPE)

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

It's V.R. Day, "victory in reform."

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D), MAJORITY LEADER: That the best way to move forward is include a public option with the opt-out provision for states.

(END VIDEO CLIP)

OLBERMANN: Even Max Baucus buys it. The Senate bill will have a public option. Individual states could vote their way out.

Senator Chuck Schumer on the press and agitation that turned the Senate around; Arianna Huffington on where the politics go from here.

Conservative politics may yet go to a different place from here. Beck, Limbaugh, Palin on the cover of "The Weekly Standard" as the faces of the GOP. Guess who disagrees.

(BEGIN VIDEO CLIP)

NEWT GINGRICH ®, FORMER SPEAKER OF THE HOUSE: You can have a very, very intense movement at 20 percent. You can't govern. To govern, you've got to get 50 percent plus one after the recount.

(END VIDEO CLIP)

OLBERMANN: Newt, voice of reason? Or just launching his annual "Maybe they'll draft me to run for president someday," Harold Stassen kind of thing.

FOX proves Obama's point-the administration is critical but does nothing to impinge the talk TV network's freedom. So, Dana Perino goes on and compares Obama to Hugo Chavez shutting down TV stations.

And, tonight-the end of Boss Limbaugh.

(BEGIN VIDEO CLIP)

RUSH LIMBAUGH, RADIO TALK SHOW HOST: Here is what Barack Obama wrote in his college thesis at Columbia University. "The Constitution allows for many things, but what it does not allow is the most revealing. The so-called founders did not allow for economic freedom."

(END VIDEO CLIP)

OLBERMANN: He says the president's college thesis concluded that the Constitution is inherently flawed, "Time" magazine sat on the story for a year-go grab your pitchforks and light your torches. Except Obama didn't write that; Limbaugh got it from a satirical Web site. It's a spoof, he got punked. To which Limbaugh says, "Well, I know Obama thinks it anyway."

Suze Orman doesn't think it anyway.

(BEGIN VIDEO CLIP)

SUZE ORMAN, ACTRESS: And you should be very glad I'm feeling better, shouldn't you?

(END VIDEO CLIP)

OLBERMANN: The co-star of "Curb Your Enthusiasm" joins us for her turn on the political merry-go-round.

All that and more-now on COUNTDOWN.

(BEGIN VIDEO CLIP)

ORMAN: Should I be upset about this?

(END VIDEO CLIP)

(END VIDEOTAPE)

OLBERMANN: Good evening from New York.

The leader of the U.S. Senate has now joined the leader of the House of Representatives in saying, "Yes, Congress will create not-for-profit government-run health insurance, giving Americans an alternative to the soaring premiums and the soaring profits of the giant insurance cartel."

Our number five story tonight: The public option lives, with the caveat that Majority Leader Reid said states would have a chance to opt out, a chance to do so until 2014, even though the public option wouldn't go into effect until 2013. Some confusion about what that meant.

The White House not confused at all, this afternoon, releasing a statement saying that the president is, quote, "pleased that the Senate has decided to include a public option for health coverage."

Republicans are responding as well. House Republican Leader Boehner saying any version of the public option is a path to, quote, "government-run health care"; Boehner offering no alternatives.

But it is not just any version of the public option that Mr. Reid is bringing to the floor. The senator is saying President Obama and the chairman of the two committees which wrote health care bills agreed to make the public option optional.

(BEGIN VIDEO CLIP)

REID: As we've gone through this process, I've concluded with the support of the White House, Senators Dodd and Baucus, that the best way to move forward is to include a public option with the opt-out provision for states.

(END VIDEO CLIP)

OLBERMANN: COUNTDOWN has learned, Mr. Reid sent several iterations of the public option today to the CBO, the Congressional Budget Office, which is now scoring them, estimating the cost for various ways of, for instance, letting states opt-out, whether they could opt-out until 2014, as Mr. Reid said, or some other date, whether state legislators or just governors will be able to pull their entire state out of the public option.

COUNTDOWN tonight also getting some clarity on what Reid meant when he said non-profit co-ops not run by the federal government are also in his bill-co-ops being another option for health consumers who cannot get insurance through their employers, as well as one way for states to go if they opt-out of the public option.

The Maine senator, Olympia Snowe, the Republican seen as Democrats' best hope for a nominally bipartisan bill, has consistently pushed back against even an opt-out public option. Reid was asked about her today, and said in essence, "See you."

(BEGIN VIDEO CLIP)

REID: I spoke to Olympia on Friday. I've talked to her on a number of occasions and at this stage, she does not like a public option of any kind. And so, we'll have to move forward on this and there will come a time, I hope, where she sees the wisdom of supporting a health care bill having after having an opportunity, her and others to offer amendments.

(END VIDEO CLIP)

OLBERMANN: Mr. Reid has more than 50 Democrats behind the public option, but to pass it, he needs 60 senators to agree on holding an up-or-down vote-that means every single Democrat.

This weekend, the Democrat Ben Nelson of Nebraska told "Politico" he must see the bill first before he could decide whether to help Republicans block Democrats from voting on it. Today, spokesman for Democrat Blanche Lincoln of Arkansas told the "Plum Line" blog she will have also have to wait.

Mr. Reid today predicting they will fall in line when the bill hits the floor.

(BEGIN VIDEO CLIP)

REID: As soon as we get the bill back from CBO and people have a chance to look at it, which they'll have ample time to do that, I believe we clearly will have the support of my caucus to move to this bill and start legislating.

(END VIDEO CLIP)

OLBERMANN: Time now to bring in one of the primary advocates of the state opt-out compromise, the Democratic Senator Chuck Schumer of New York.

Great thanks for being with us tonight, sir.

SEN. CHUCK SCHUMER (D), NEW YORK: Hey, good evening.

OLBERMANN: How do you know-how are you sure that Blanche Lincoln and Ben Nelson will let Democrats have the up-or-down vote on the public option?

SCHUMER: Well, the reason I think, there's a lot of confidence in our caucus is Harry Reid. He's the best vote counter there is. He spent a lot of time with each of them and I wouldn't bet against Harry Reid.

He was not, you know-our primary goal here is to pass a good, strong health care bill. We-many of us-feel strongly that a public option should be in the bill, and Leader Reid is able to weave the desires of the caucus into sort of a finished product. And, so, again, don't bet against him.

OLBERMANN: Senator Schumer, Senator Dodd said tonight that this is his committee's version of the public option that has been presented. How accurate is that to your knowledge?

SCHUMER: Well, it is. The level playing field public option is something that the health committee backed. I had proposed it early on as a way to bring moderates around and not have the Medicare set the rates and the health committee thought along exactly the same lines. The proposal that I made, the proposal that the health committee made were very similar. So, Senator Dodd's correct.

OLBERMANN: Senator, if the public option is enacted and it is still closed to people who get their coverage through work, how will that exert competitive pressure on the insurance companies who sell company plans?

SCHUMER: Well, if the public option works as we think it will, it's going to be different. It's going to have to play by the same rules as the insurance companies-same reserves and same requirements and same kinds of regulations. But, first, it's not going to have to make a profit. That's 10 percent to 20 percent off the top. Second, it doesn't have to merchandise. It doesn't have to go out and try and sell. And third, it's going to have sort of a different view.

And the private insurance company is supposed to maximize profits for their shareholders, that's what capitalism is; whereas, the public option is supposed to serve its members. And so, they're not going to be scrambling for ways-if you have cancer-to figure out a way, well, maybe we can say that it was not covered by our insurance policy as private insurance would.

So, it's going to be a competitor on a level playing field but with different values. And we'll have to see who likes what best.

We think a public option will do two things. First, it will give a home to people who don't like private insurance, who private insurance won't treat will. But second, even if you want to keep your private insurance, it's good for you, because it will create pressure on those companies, pricing pressure downward, and delivering services in better way.

OLBERMANN: To that point, do you know, Senator, what Mr. Reid meant when he talked about states possibly opting out by 2013. Was he talking about giving them a one-year window before they had to opt out? It weren't clear.

SCHUMER: Yes. And I know what Senator Reid is intending, but because we has sent it over to CBO and as a private matter, and you don't want to make the CBO score public yet, although we will certainly have it balanced, it's wise not to talk about the specific details.

OLBERMANN: All right. Let me ask you.

SCHUMER: And Senator Reid asked me not to when I'm going to.

OLBERMANN: OK. Fair enough.

SCHUMER: I'll obey that.

OLBERMANN: A question about another date. "Politico" reported that several Democrats were pushing to move up some of the more tangible benefits of this project to start next year. Is that plausible? Will they succeed?

SCHUMER: It is plausible. You know, I think that once we pass health care-good, comprehensive, strong health care-it's going to be very popular with the American people. And there are some who say, "Let's bring some of those tangible benefits immediately to people." And that's a good idea. But, obviously, it will have to be done within the constraints of keeping this balance.

The president has promised and we, in the Democratic Caucus-liberals and conservatives alike-are going to stick with the promise that this will not increase the deficit.

OLBERMANN: Last question, Senator, give me an assessment of where this date ranks among the dates of the process of getting health care reform in this country? Is it time for congratulations or is this just a plateau on the mountainside?

SCHUMER: Well, it's in between. It's a great day. It's a giant step forward. But it ain't over until the fat lady sings and this has been a very, very tough thing to do.

I give the president credit in this sense. This is one of the hardest things I've ever seen to be accomplished because we've seen it fail so many times before. He stuck with it. We're sticking with it. The House is sticking with it.

And I would bet we're going to get this done, but there will probably be some twists in the roads that you and I don't anticipate because that's how this has been from the get-go.

OLBERMANN: Well, to the degree the congratulations are ordered, whatever that in order-my congratulations to you, Senator Schumer of New York and thanks for your time tonight.

SCHUMER: Thank you. Nice to talk to you.

OLBERMANN: Time now to bring in Arianna Huffington, cofounder and editor of HuffingtonPost.com.

Arianna, good evening.

ARIANNA HUFFINGTON, HUFFINTONPOST.COM: Good evening, Keith.

OLBERMANN: A big day, you won. Is that the way you see it? Or where do you think we stand right now?

HUFFINGTON: Well, I agree with Senator Schumer that they-this is not the time yet for a victory lap. We have many miles before we sleep. But what is very interesting is that despite the fact that the White House would have preferred a trigger, as Sam Stein and Ryan Grim reported on "The Washington Post" over the weekend, progressives made it very clear that any kind of bill without a public option would not have been acceptable and that included progressives in the Senate, like Senator Russ Feingold who said that on the Sunday shows.

But also, Keith, let's just look at that bill carefully. There's still a lot in that bill which is very troubling. There is the concession to pharma, which means we cannot negotiate for lower prices because of the economies of scale that the government has. There is the fact that the public option would only really reach about 10 million people. It would not affect anybody who already has insurance with their employer. And there's, of course, the opt-out, which means that many, many millions of people, potentially, may not be able to have access to a public option.

So, there's a lot that's troubling but it's definitely a step in the right direction with many road blocks remaining.

OLBERMANN: Speaking of road blocks, Blanche Lincoln, Ben Nelson letting Republicans blocking Democrats on an up-or-down, as we just discussed with Senator Schumer, if they're not going to do that, is there a reason they are not saying so? And is it important to let them have their reasons as long as they don't actually go with the Republicans on this?

HUFFINGTON: Well, they can have any reasons they want. But it would be unconscionable for two Democratic senators to go along with the "party of no" that has caricatured and undermined any effort at any reform whatsoever. It's one thing to oppose one provision or another. It's another to go down against your own party, against something that the vast majority of the American people want.

Can you just imagine the kind of commercials that would be run against Blanche Lincoln, Blanche Lincoln does not believe in democracy, does not want health care for her own constituents? I don't think she would want that, and I don't think Ben Nelson would want that.

OLBERMANN: And this all dovetails back into that-this late development here about discussions of kicking in some of this, at least the highlights, perhaps to seniors in time for next year. Obviously, there is the urgency of now to anybody who has health care, that is less than 100 percent, which would be more than 100 percent in the country who would probably agree with that statement, but there's also a political consideration. Is it enough to get it to happen?

HUFFINGTON: Well, you know, Keith, I find it unbelievable that we would accept waiting until 2013 before we have any kind of real health care reform. It doesn't make any sense. That's not what this country is about.

It took 11 months before we had Medicare benefits after Lyndon Johnson passed the-signed the legislation. Come on, it took eight years from the time that JFK said that we would put a man on the moon to the time we put a man on the moon. Is it going to take that many years to actually implement the health care reform that we are going to pass? It doesn't make any sense.

OLBERMANN: Well, Aetna did not own the moon. So, there's your explanation right there, or the routes to it.

Arianna Huffington of "Huffington Post"-as always, great thanks, Arianna.

HUFFINGTON: Thank you.

OLBERMANN: The Republicans, of course, have just declared the public option dead and were congratulating their young, vibrant leadership on killing it, like-Senator Grassley, or Sarah Palin who used to be in politics as I understand it, and two ex-top 40 disc jockeys. The latter distinctions are not mine. They have been made by a prominent Republican who has gone to war against La Palin over a congressional vote in New York state and who was himself never a disc jockey.

(COMMERCIAL BREAK)

OLBERMANN: A prominent Republican says Beck, Limbaugh and Palin are fine and all, but they represent only enough for a movement of 20 percent, not a party that can win elections. Spare me the movement jokes.

And tonight, the statistics which will permit you to make an informed World Series prediction.

Plus, Limbaugh gets punked big-time.

You're watching COUNTDOWN on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: The party of divide and conquer is now loudly conducting an experiment. But instead of dividing its opposition through opportunistic fear, it seems to be dividing itself, for reasons that are typically unclear.

And in our fourth on the COUNTDOWN: Former House Speaker Newt Gingrich decries the vocal but limited 20 percent. This after a prominent conservative magazine had featured the GOP's new leadership as Rush Limbaugh, Glenn Beck, and Sarah Palin, and not Newt Gingrich.

Mr. Gingrich, you may recall, has already in a proxy fight with former Governor Palin over a special election in the conservative congressional district in Upstate New York. Gingrich backs the Republican candidate while the governor supports the conservative party nominee.

And on the national scene, there is more evidence of a party fracturing.

(BEGIN VIDEO CLIP)

GINGRICH: Well, I just think it's interesting that two of the three people on the cover are talk radio hosts and.

UNIDENTIFIED MALE: Glenn Beck and Rush Limbaugh.

GINGRICH: Glenn Beck and Rush Limbaugh, and they're fine people and they have big audiences and that's terrific. But you have a party which has Governor Haley Barbour. It has Governor Mitch Daniels. It has Governor Tim Pawlenty.

(END VIDEO CLIP)

OLBERMANN: The former speaker continued to rattle off almost every conceivable Republican presidential or contender for 2012, except Harold Stassen. He even said that former Governor Palin could be a national force if she does well on "Oprah" and on her book tour. However.

(BEGIN VIDEO CLIP)

GINGRICH: You know, you can have a very, very intense movement at 20 percent. You can't govern. To govern, you've got to get 50 percent plus one after the recount.

(END VIDEO CLIP)

OLBERMANN: Since the recent poll plays self-identified Republican at a new low, coincidentally at 20 percent, one wonders if Gingrich puts the Limbaugh, Beck, Palin crowd at 20 percent of 20 percent, which would be 4 percent. Or if he thinks those disaffected Republicans already represent a break away bloc existing outside the GOP. In any event, Mr. Gingrich now joins South Carolina Republican Senator Lindsey Graham in daring to question whether Glenn beck tea partying Republicans are the sharpest tools with which to try to rebuild the GOP house.

Let's turn to the Washington editor of "The Nation": Chris Hayes.

Chris, good evening.

CHRIS HAYES, THE NATION: Good evening, Keith.

OLBERMANN: I want to start with substance here. This special election in the Upstate New York congressional seat-is this as much of a litmus test as it seems about the Republican Party or it just, you know, great fun for Democrats?

HAYES: No. I think-I think it really is shaping up as kind of early skirmish in what is shaping up to be this big battle within the sort of conservative coalition, broadly the Republican Party. You're seeing a tremendous amount of mobilization around the independent conservative right-wing candidate Doug Hoffman.

And what's really interesting is to see what the way the Republicans hope to have a shot at the presidential primary in 2012 are lining up endorsing this independent against their own party-which on the other side, if you want to look for your closest possible analogy, which is the Ned Lamont-Joe Lieberman primary, I mean, the Republican Party was anathema to support Lamont at all even after he won the primary.

And so, I think it's really interesting to see just how much power the conservative base has within the party right now.

OLBERMANN: Is the conservative base being paid by the Democratic National Committee to split the Republicans into two completely nonviable political parties in time for the 2012 elections?

HAYES: I doubt it. I mean, I-you know, what's that old, there's some Sun Tzu mantra about not getting in the way your enemy-when they're destroying themselves. I mean, I think there is every reason to believe that these kinds of, you know, purges are destructive for the party's long-term electoral prospects.

I will say, however, the progressive movement went through a period in the wilderness when its base really got mobilized. It really got organized and took on a lot of the party establishment, I think, to the great benefit of ultimately, the Democratic Party.

And so, I wouldn't be too soon to scoff at what we're seeing here. I think, in the short-term, you can't have a national political mandate for figures like Doug Hoffman at all. In the long-term, however, this may pay off institutionally if you do see some sort of new blood within the Republican Party.

OLBERMANN: And that makes Gingrich's point of view even stranger. There was another interview he did in which he didn't really hesitate to underline this point. Let me quote it directly. "If some people in the Republican Party want to go around the country purging everyone they disagree with, they're going to rapidly make this a party for-minority party for a generation. And they're going to guarantee the reelection of President Obama and they're going to guaranteed Nancy Pelosi stays as speaker for the rest of her life."

Is this his honest assessment? Is he correct? Or is this, you know, Newt Gingrich as his dream of being Cincinnatus, called out of retirement by, you know, a desperate and beholden nation?

HAYES: Well, you know, I think he's-I think it's-that's what he believes because, I mean, Newt Gingrich is a creature of the establishment. And the irony, of course, is that there was a time when I don't think he was. In fact, there was a time which within the GOP's own internal battles, you know, essentially a generation ago now, he was the brash, right-wing conservative purist who was taking on the sort of sluggish and kind of go along/get along members of the Republican Party in the House. He's now sort of now part of the establishment.

And, look, the quote that he gave, you could have-you could have heard-identical quotes are being given all the time on both sides of the aisle by members of the sort of political establishment of whatever party it is, which is to say that, you know, "You ideological purists, you don't understand what it takes," and that's a-that's a sort of, you know, perennial here in Washington.

OLBERMANN: Well, we'll see if he gets Lindsey Graham, and we'll see how bad it is, and whether or not he winds up joining the Democrats.

(CROSSTALK)

OLBERMANN: Chris Hayes of "The Nation"-boy, that would be something. Many thanks, Chris.

HAYES: Thank you, Chris.

OLBERMANN: Gingrich may have damaged Rush Limbaugh, but not as much as Limbaugh has just done. The web story about Obama's supposed reference in his college thesis on the Constitution, to distribution of wealth-it was just too good to be true. So Rush ran with it anyway, right off the freakin' cliff. I wonder if he'll bounce.

(COMMERCIAL BREAK)

OLBERMANN: "Best" in a moment, and really, the Phillies star was that bad against left-handed pitchers?

First, on this date in 1881, the Clanton family and friends, faced Marshall Wyeth-Marshall Wyatt Earp, in the shootout at the OK Corral. Who's Marshal Wyeth? Thus providing history with about 40 movies and TV series about Wyatt Earp, including one in which he was portrayed by two-time Olympic swimming medalist Buster Crabbe.

Let's play "Oddball."

Hold it right there, Clanton, gargle, gargle, gargle-to western Massachusetts where the fast lane in the state turnpike became considerably slower when three semis and a car collided with a toll plaza. Amazingly, only one person was hurt, only minor injury. However, beef was spilled out of one of those semis, strewn all over the highway like some sort of really funky tailgate party. State police said one of the trucks hit the toll booth, creating a rear end chain reaction. That morning, commuters were waved through the remaining toll lanes free of charge.

Hold the pickle, hold the lettuce. Special orders don't upset us.

In Northern Latvia, near the town of Mazsalaca, a meteor crashed into

the Earth. Experts rushed to the sight of the crater, 27 feet wide and

nine feet deep. There was even this great amateur video of the burning

aftermath. But dawn brought a dose of reality when scientists are saying

the hole is too neat to be a real impact site. The University of Latvia's

geologists Girts Stinkulis saying-I'm not even sure that's a real name -

saying the big hole was clearly dug with a shovel, making the meteorite a hoax.

Rush Limbaugh has proclaimed with confirmation that Barack Obama was born in Latvia. Oh, silly Latvians. Throw them some good video, they'll believe just about anything-never mind!

The Obama administration accuses FOX noise of fabricating falsehoods about it, whereupon Fox promptly fabricates a story about the administration cutting it out of an interview.

Meanwhile, Limbaugh propagates a totally phony story about the president's college thesis. And when it proves to be a phony, he says, "Yeah, but it's still true anyway."

These stories, but first on COUNTDOWN, some of the best persons in the world. Dateline, Washington. Number three. Best indication somebody didn't pay attention in school.

Coultergeist, saying on national TV of the Kennedy assassination, "Lee Harvey Oswald tried to move to the Soviet Union. He was on his way to Cuba. He was a communist. You have one after another, all these guys. So, it isn't, it isn't because Obama is liberal. If something happens to him it's going to be MoveOn.org."

Oswald was on his way to Cuba? And he only got as far as the Texas theater. He tried to move to the Soviet Union, you said? He moved to the Soviet Union. He renounced his American citizenship. He lived there nearly three years, then he moved back here.

It's one of the few things all historians and conspiracy theorists agree on.

Do we have any evidence that Ann Coulter even went to one history class at Cornell?

Dateline New York. Number two, best call-out. Geraldo Rivera at the El Diario luncheon.

"One of the aspects of our reality in the United States now is the defamatory tone of the immigration debate and how that immigration debate has slandered an entire race of people.

"Lou Dobbs is almost single-handedly responsible for creating, for being the architect of the young-Latino-as-scapegoat for everything that ails this country."

Rivera also insisted Dobbs is not going to Fox News, which is too bad, because it would be easier if we kept all the racists in one place.

Mr. Dobbs' response? "What did Marianna Rivera say?"

And dateline Philadelphia, speaking of that, number one best World Series statistic, Ryan Howard of the Philadelphia Phillies.

This is the set of numbers that should best help you figure out what will likely happen in the World Series beginning on Wednesday: 107 at bats, one home run, eight runs batted in, .178 batting average, .290 slugging percentage, and 51 strike-outs in 107 at bats.

That's what the most valuable player of the N.L. championship series, Ryan Howard of the Phillies, did this year in his home ballpark against left-handed pitchers. One homer in his own ballpark against a left-handed pitcher, 44 homers against everybody else.

The Yankees have two top left-handed starting pitchers and two left-handed relievers. And if Howard can't hit them, the Phillies can't win.

(COMMERCIAL BREAK)

OLBERMANN: After admitting that the Bush administration essentially froze communication with and access by this network, former Bush White House press secretary, Dana Perino, feigns shock and awe over the Obama administration's pushback against Fixed News.

Meanwhile, Fixed News executive claims the White House admitted to a mistake and apologized to that network. The White House says it did nothing of the sort.

Our third story in the COUNTDOWN, Fox Noise helps the Obama administration prove its point, as it just continues to make stuff up. First, faux outrage over a network pool interview with White House pay consultant, Kenneth Feinberg. Fox says it was excluded from the interview. The White House says Fox never asked to be included.

Oddly enough, Fox wound up doing the interview anyway. Then, Fixed News V.P., Michael Clemente, told the Huffington Post that White House press secretary Gibbs had acknowledged a mistake was made in not including that network. A White House official then told TPM that Gibbs did not apologize.

Meanwhile, Chris Wallace, on his Sunday show-making sure his program carved out some time to discuss the war on the White House-turned to former Bush White House press secretary Perino for her reaction.

(BEGIN VIDEO CLIP)

DANA PERINO, FORMER BUSH WHITE HOUSE PRESS SECRETARY: It was a coordinated, calculated attack. It was unbecoming. And if you look at some of the coverage of what mainstream media covers when, for example, somebody like a Hugo Chavez shuts down television stations, he calls them illegitimate.

Now, I'm not suggesting that this White House believes that they are going to come over here and shut down Fox News. But they are defining a narrative in their first year. And it's going to be very hard to recover from it.

(END VIDEO CLIP)

OLBERMANN: Oh, God, is she full of crap!

Ms. Perino, perhaps forgetting that she slipped and told the truth on "Cluster Fox and Friends" just last week about the Bush White House's track record with MSNBC.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: And not only did you not go after them, you gave them interviews, as did the president. You gave them all interviews. You read Ronald Reagan's diary...

PERINO: Well, towards the end, we didn't do a lot with MSNBC.

(END VIDEO CLIP)

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

Richard, good evening.

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

OLBERMANN: I'm trying to get the moral relativism here. This administration criticizes Fox. Therefore, on Fox, Obama is Hugo Chavez.

And the previous one-let me read the list again. It cuts off MSNBC. It threatens NBC. It has its political party threaten to back out of a Tom Brokaw-moderated debate, if I'm not removed as a news anchor.

It pays columnists to write pro-Bush columns in secret, plants questions and a fake reporter in its own news conferences. And Dana Perino thinks she was being patriotic.

I'm missing something in the equation. What is it?

WOLFFE: Yes. I wouldn't suggest that it's unbecoming. It's just not becoming.

Let's just replay the tape, shall we. The big rupture between the Bush White House and NBC News was over this little thing that happened in Iraq, and specifically that NBC News correspondents-in particular, Richard Engel-were actually reporting just how bad the situation was over there. And the Bush White House at the time thought they were being pro-American and pro-troops by calling out a news division.

So, the whole patriotism card ought to be familiar to Dana Perino.

And on top of that, you know, NBC News then had the gall to describe the situation in Iraq just as the rest of the world was, that it was a civil war.

I mean, this stuff is not exactly the same as, I don't know, a death panel or something.

OLBERMANN: The whole thing with the pool interview last week, when Fox claimed it had-and falsely claimed-it had been excluded.

This is not Fox. Fox is usually wrong-I would say malevolent-but skilled. They don't make mistakes, and that was setting themselves up for ridicule.

Are they off their game? Was it just a blip? Are they feeling a little bit more heat than they're letting on? Do we know?

WOLFFE: Oh, I think this skill has no relationship to anything factual, actually, and that this-this little conundrum is working out, they think, pretty nicely for them. They see their numbers are up. The more outrageous they get, the less relationship they have with the truth, their ratings still go up.

So, as long as they're making money, who's to complain except, you know, the White House and rational people?

OLBERMANN: Of course it doesn't-I mean, the ratings went up before this went back and forth with Obama, because as soon as Obama won, everybody who was scared of that ran over to Fox. I mean, there is a cart before the horse thing on this.

WOLFFE: Right.

OLBERMANN: But what's the-what's the White House endgame on this?

What's the Fox endgame on this?

If an executive admitted, as one did months ago, that it is the home of the opposition, how can an operation then claim it is not just a political entity?

WOLFFE: Well, what's interesting is the political entity they're carving out for themselves.

I don't think the White House was right in describing them as the arm of the Republican Party. They're trying to set up something new as the voice of the disaffected independents who don't like Democrats, don't like Republicans.

And look, I think they are setting themselves up for a faux campaign. You know, it's just one more marketing tool up Roger Ailes' rather large sleeve.

OLBERMANN: Oh, thank goodness you said sleeve.

The Obama administration, according to Ms. Perino, is setting a bad example for emerging democracies by being critical of Fox.

What-when the Bush administration bought positive stories from Iraqi journalists for publication in Iraqi newspapers, what was that? A how-to course in how to start up a democracy?

WOLFFE: Well, the democracy thing is something I love the best. Self-reflection, recollection has not always been the strength of the Bush administration.

I just want to remind Dana Perino and all the rest of them, that there was this exchange early in the second term between Bush and this guy in Russia called Vladimir Putin. Bush was trying to teach Putin a lesson about how to deal with the press. He said, you can't go around intimidating them-quite rightly-cannot go shutting down the free press.

Putin turned around back to Bush and said, "Well, how come you got rid of Dan Rather, then?"

(LAUGHTER)

And you know something? When it comes down to it, Putin, Chavez-all of those dictators or, let's say, autocratic leaders-are more than adept at reading the news, interpreting the news and maybe seeing things that they want. And the Bush administration was just as forceful, if not more so, than anything we're seeing out of this White House.

OLBERMANN: Amen. And Dan Rather is still on the air, and George Bush is doing $19 a ticket motivational speech ceremonies.

Richard Wolffe of MSNBC, author of "Renegade," senior strategist at Public Strategies, thanks as always, Richard.

WOLFFE: Thank you, Keith.

OLBERMANN: Our nightly look at the political merry-go-round. Tonight's victim-tonight's guest is Susie Essman from "Curb Your Enthusiasm."

Victim only of himself, Rush Limbaugh falls for one of the most obvious spoofs of the president ever-treats it as news fact.

And when Rachel joins you at the top of the hour, more on the breaking news from Harry Reid's confirmation. The Senate bill will have a public option. Her guest, Mr. Wyden of Oregon, please.

(COMMERCIAL BREAK)

OLBERMANN: Susie Essman from "Curb Your Enthusiasm." On the show, Obama's decision not to throw her husband under the bus on Jay Leno's show.

First, the worst. And though Abraham Lincoln did not say it, you know, you can fool some of the people all the time. And that people's name is Rush Limbaugh.

(COMMERCIAL BREAK)

OLBERMANN: Susie Essman from "Curb Your Enthusiasm" on the president as co-ed golfer, and the first lady refusing to reveal his bad habits to an anxiously awaiting nation.

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

Number three, the Dallas Police Department.

A training officer named Gary Bromley caught a driver named Ernestina Mondragon making an illegal U-turn. And he gave her a ticket for not speaking English.

This was bad enough. The department said it was a rookie mistake. Police Chief David Kunkle has now admitted that, in fact, his officers have written at least 39 such tickets to drivers who didn't speak, or were not speaking English. The chief has apologized to the Spanish-speaking community of Dallas, and promised dismissals and reimbursements.

Our runner-up, George Will, whined on ABC's "This Week" yesterday that the Baucus Senate Finance Committee health reform bill, "although they could put this on the Internet in 10 minutes, they haven't put it on the Internet, this 1,502 pages, because people might discover what's in there."

The bill has been online for a week, since the 19th.

What was that line from the old Avis Rent A Car TV commercial? Ever get the feeling some people just stop trying?

But our winner-Rush Limbaugh. If he had any remaining credibility, it's gone now-punked. Happily, willingly, enthusiastically-he'd probably say something about cheerfully grabbing his ankles-punked.

Tracing this back to a Web site called Jumping in Pools, Limbaugh exploded over the news that, in his college thesis, Barack Obama had ripped the Constitution.

Nothing-not even the age-old maxim that, if it's too good to be true, it probably isn't-caused Limbaugh to think, even for a second. Jumping In Pools is a spoof blog, a satire Web site. It posted its spoof in August. And it's now October, and nobody had reported the shattering details in the interim.

Even that did not spark Limbaugh's tiny little mind to say, "Wait a minute."

Thus, Limbaugh proved he has neither honesty nor common sense.

(BEGIN VIDEO CLIP)

RUSH LIMBAUGH, RADIO TALK SHOW HOST: Here is what Barack Obama wrote in his college thesis at Columbia University.

The Constitution allows for many things. But what it does not allow is the most revealing. The so-called founders did not allow for economic freedom. While political freedom is supposedly a cornerstone of the document, the distribution of wealth is not even mentioned.

(END VIDEO CLIP)

OLBERMANN: In fact, none of it was mentioned, because he didn't write that.

But Viagra'ed by that reference to distribution of wealth, Limbaugh sped on towards the cliff.

The spoof site also then claimed 10 pages of this thesis had been shown to Joe Klein of TIME Magazine. Limbaugh bit again.

(BEGIN VIDEO CLIP)

LIMBAUGH: So, Joe Klein at TIME Magazine has known for a long time about Obama's college thesis, when he was at Columbia.

Why didn't this come out a year ago at this time? Why didn't this come out before the election in November?

(END VIDEO CLIP)

OLBERMANN: Probably because it didn't happen, chowder head. And you're too stupid to realize it.

(BEGIN VIDEO CLIP)

LIMBAUGH: Ladies and gentlemen, Barack Obama is seriously dangerous. To say that distribution of wealth is economic freedom is intellectually insane. They are mutually exclusive.

Economic freedom means you don't have somebody take your money and give it to somebody else.

Distribution of wealth? We've already done it. Where has this guy been?

(END VIDEO CLIP)

OLBERMANN: Isn't the more pertinent question, Rush, where have you been? And was there enough room up there for your entire, or just the top of it?

Also, the Starship wants its music back.

Finally, somebody sympathetic to Limbaugh broke to him the news that the source of his great scoop was a satire spoof Web site.

And onward still he rolled.

(BEGIN VIDEO CLIP)

LIMBAUGH: But we know he thinks it. Good comedy, to be comedy, must contain an element of truth. And we know how he feels about distribution of wealth. He's mad at the courts for not going far enough on it. So, we stand by a fabricated quote, because we know Obama thinks it anyway.

(END VIDEO CLIP)

OLBERMANN: He's backpedaling like a bear on a unicycle.

So, it's not true, but Limbaugh says, therefore, it is true anyway.

The others who bit on this whopper, like the National Review-even Lou Dobbs-rushed quickly away from their embarrassment. But not Rush Limbaugh-or as he might now best be renamed, Orally Taitz (ph).

Orally Taitz (ph) Limbaugh. Today's worst person-oh, God, is this bad-in the world.

(COMMERCIAL BREAK)

OLBERMANN: Our number one story in the COUNTDOWN, and breaking news out of Fort Belvoir in Virginia, President Obama went golfing with a woman.

(GASP)

Also, the first lady stopped short of outing her husband's bad habits to Jay Leno.

Susie Essman's character on "Curb Your Enthusiasm" would have dropped the dime on her husband in a New York minute.

She's here to discuss, first, to the links, tweetline Sunday. CBS News Radio reporter Mark Knoller tweeted to the world that the president had gone golfing in Virginia. The president's foursome was co-ed for the first time. Chief domestic policy advisor, Melody Barnes, also played.

Knoller noted that Sunday made two dozen rounds of golf since Obama has taken office, noted it took the president-President Bush-almost three years to log 24 rounds of golf. And, of course, Mr. Bush, who spent the better part of three years living in Crawford, Texas, and Maine during his presidency, gave up golf in 2003, he said as a wartime sacrifice, even though we caught him swinging away after he had said he quit.

As to the first lady's appearance with Jay Leno on Friday, Michelle Obama took part in Leno's 10 at 10 rapid-fire question segment. The questions ranged from Halloween costumes for the Obama girls to the names of the kids from "The Brady Bunch" to the things the president does that get on his wife's nerves.

(BEGIN VIDEO CLIP)

JAY LENO, HOST, THE JAY LENO SHOW: The most annoying habit the president has.

(LAUGHTER)

MICHELLE OBAMA, FIRST LADY OF THE UNITED STATES: Ooh.

(LAUGHTER)

We don't have enough time.

(LAUGHTER)

(APPLAUSE)

He has no annoying habits. Right, Jay? None.

LENO: Exactly.

OBAMA: He's perfect.

LENO: Exactly.

(LAUGHTER)

Hey, I don't want to get audited.

OBAMA: But when he-you know what? You know what? When he beats me at tennis, that gets to be pretty annoying. And he beats me quite often.

LENO: Oh, OK. All right.

(END VIDEO CLIP)

OLBERMANN: So, you just hear that last part of the clip. "He beats me quite often."

Currently starring in "Curb Your Enthusiasm," seventh season as Susie Greene. Susie Essman's book is "What Would Susie Say: Bull Something"-and we have to say "Bull Something," sorry...

SUSIE ESSMAN, ACTOR, "CURB YOUR ENTHUSIASM": OK.

OLBERMANN: ... "About Love, Life and Comedy." It is in stores now, and she shares some of that bull something as she joins us for our segment, the political merry-go-round.

Welcome.

ESSMAN: Hello, Keith.

OLBERMANN: How are you?

ESSMAN: I'm very good, thank you.

OLBERMANN: You seem very good and enthused, and everything like that.

A column in the "Chicago Sun-Times" said that this presidential golf outing, because it involved a woman there, was breaking the glass ceiling.

ESSMAN: I thought that, when W. played tiddlywinks with Condi, that was breaking the glass ceiling. What's the big deal?

OLBERMANN: Is that what they're calling it these days, tiddlywinks?

ESSMAN: Tiddlywinks. Exactly.

OLBERMANN: The first lady, as we just heard, says she loses to the president in tennis all the time. This begs the question, if he's a good husband, shouldn't he, like, throw a game periodically? Or...

ESSMAN: No. Because then the far right would say, a real man would never let his woman win. You can't win, if you're him. You know what I mean? I mean, no. He's got to beat the crap out of her.

OLBERMANN: Well, see, now you've provided-OK.

Now, so, when this show gets dissected by Rush Limbaugh, it's a sound clip...

ESSMAN: But we know he thinks it!

OLBERMANN: That's right. Well, he's a psychic.

ESSMAN: Yes.

OLBERMANN: Or some word that sounds like psychic.

The first lady held back when Leno asked these questions about what his greatest flaw was.

ESSMAN: Right.

OLBERMANN: What would Susie Greene have done in those circumstances?

ESSMAN: Do you have seven-second delay on this show?

OLBERMANN: No, we-no.

ESSMAN: I'll tell you about my own husband.

OLBERMANN: Yes.

ESSMAN: My own husband, his greatest flaw is that he tells really long, boring stories. But I have a thing now that I do to him. I just say to him, "Glazing," which is shorthand for my eyes are glazing over, which is shorthand for you're boring the living daylights out of me.

So, I think Michelle should do that when Barack starts at the policy and public option, which is one of the glazing topics of our time. "Glazing," and just shut him up.

OLBERMANN: To move on to publishing news, besides your book...

ESSMAN: Yes.

OLBERMANN: ... Levi Johnston, who was nearly Sarah Palin's son-in-law until he escaped, says he is 90 percent sure he is going to-full exposure in Playgirl Magazine.

ESSMAN: Really?

OLBERMANN: How many copies are you putting yourself down for on that?

ESSMAN: I guess Levi took his name, Johnston, seriously, didn't he?

Literally.

Is he circumcised?

(LAUGHTER)

Do they do that in Alaska?

OLBERMANN: Why wouldn't they do that in Alaska?

ESSMAN: I don't know. It's cold up there. I don't know, Keith. I don't know these things.

OLBERMANN: So, you would-so, you're not circumcised for warmth?

ESSMAN: Well, you tell me.

(LAUGHTER)

OLBERMANN: I can't read the next-all right. I'll move on to the next-well, the next one was something about a naked Levi Johnston being this year's snuggy gift, because the thing is supposed to be out...

ESSMAN: And you know, I think (ph) snuggies might be one of the most unattractive items to buy. And Levi Johnston might be as well. I don't know.

(LAUGHTER)

OLBERMANN: In husband-and-wife news...

ESSMAN: Yes.

OLBERMANN: ... and we keep coming back to this here, there's going to be an impeachment resolution introduced tomorrow against the governor of South Carolina...

ESSMAN: Oh, really.

OLBERMANN: ... Mark Sanford.

Do you have any advice, either in a political or a family sense, for this, the infamous, old Appalachian Trail hiker, Mark?

ESSMAN: I would get off the Appalachian Trail if I were him, and start hanging out in airport bathrooms in Minneapolis.

(LAUGHTER)

OLBERMANN: That's-they've done that already.

You have an entire chapter on hypochondria in your book.

ESSMAN: Yes.

OLBERMANN: And we're dealing with health care reform.

ESSMAN: Yes.

OLBERMANN: Could you support a bill with a public option, or without, that did not call for more hand sanitizer?

ESSMAN: No. Absolutely not. Hand sanitizer is the greatest invention of our time.

Wipe, wipe, wipe, wipe, wipe. You can't be-how-do you have no -

when you do those touch screen ATMs, what are the odds that a person before you was not a nose-picker?

(LAUGHTER)

Right? Wipe, wipe, wipe.

OLBERMANN: Well, it's not Howie-you're not at the Howie Mandel level of this, right?

Susie Essman of "Curb Your Enthusiasm." The new book is "What Would Susie Say?" And then there are some words we can't repeat here.

Great thanks-a great pleasure to meet you.

ESSMAN: You, too, Keith.

OLBERMANN: Take care.

That's COUNTDOWN for this, the 2,370th day since the previous president declared mission accomplished in Iraq.

I'm Keith Olbermann. Good night, and good luck.

And now, to discuss the Senate plan for health care reform with Senator Ron Wyden of Oregon, ladies and gentlemen, here is Rachel Maddow.

Good evening, Rachel.

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

END

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