updated 11/17/2009 10:45:16 AM ET 2009-11-17T15:45:16

THE ED SHOW

November 16, 2009

THIS IS A RUSH TRANSCRIPT.

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

Guests: Katrina vanden Heuvel, Byron Dorgan, John Nichols, A.B. Stoddard, Ron Christie, John Feehery, Todd Webster, Wendell Potter, Dick Durbin

ED SCHULTZ, HOST: Good evening, Americans. Welcome to THE ED SHOW from New York tonight.

We were on the road over the weekend. For the last 18 months, our team has done town hall meetings across this country. And last night we were in Seattle, Washington.

If Seattle, Washington, is any indication, as were other locations, there is a growing frustration across the country with progressives. The liberal base is becoming more vocal about health care reform and what they want, the economy, and the perceived weakness of the Democrats, including the leadership of the White House.

The hot button on health care was the public option. Just what is it, along with the 40 million new customers the insurance industry is going to get through this mandate, if that goes through?

This middle class American with prostate cancer stood up last night and wanted to know what health care reform was going to do for his situation.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I was working for a Fortune 50 company here in the Seattle area for 15 years, and I have prostate cancer. And after a year they sent me a letter and said if I didn't get back to work within a month, I would be fired. And I just wasn't strong enough.

The difference between what an insured person gets and what an uninsured person gets charged is just phenomenal. This is why so many people go bankrupt in this country. You know, I have a bill here for two months worth of hospital bills and doctors visits that totals $56,000.

(END VIDEO CLIP)

SCHULTZ: So there's Jonathan Webber (ph). Did you get that? He lost his job because he got cancer. He couldn't get back to work, couldn't get there because he wasn't healthy fast enough, so the company made a determination, see you, we'll find somebody else.

This is his bill. He detailed out for me just the last two months of his medical coverage. He's got a bill for $56,577. The insurance only paid $26,000 of it.

Now, you tell me, what kind of public option do you want, Harry Reid?

What kind of public option do you want, Nancy Pelosi and Steny Hoyer?

Forget the Republicans. That's what this crowd is saying. This is what I have heard all over the country. It's going to take a very dogmatic attitude down the stretch to get this thing done.

Other issues were talked about. Democratic leadership-there's a real concern that the Dems don't have a spine and won't hold the line on the public option. All I had to do was say two words, and that was "Joe Lieberman."

(BEGIN VIDEO CLIP)

SCHULTZ: You do want to get rid of Joe Lieberman, right?

(APPLAUSE)

(END VIDEO CLIP)

SCHULTZ: All I said was "Joe Lieberman, do you want to get him out?"

They went nuts.

Folks, this is why the poll numbers are dropping. It's not because of Lieberman. It's because the Democrats aren't doing what they've got to do when it coming to leadership.

Liberals across this country are getting short on patience. Interesting article in "The New York Times" today about this network, MSNBC holding the Obama team's feet to the fire. Well, we're not alone.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I'm just so angry and frustrated that I gave them money I didn't have, I took time, I got on the phone, I campaigned. What more do I have to do?

They have got a flipping majority. Why should I have to work any harder than I already have?

(APPLAUSE)

UNIDENTIFIED FEMALE: I want him to tell me-I want him to tell me why he said, why he promised, why did he promise that he wouldn't have lobbyists in Washington? And he's got them in there.

(APPLAUSE)

UNIDENTIFIED FEMALE: Why? Tell me now, why?

Why is Geithner still in there? Rahm Emanuel? Why are these people there? I was lied to.

(END VIDEO CLIP)

SCHULTZ: Joining me now is Katrina vanden Heuvel, editor of "The Nation."

Just a flavor of a town hall meeting last night in a very progressive part of the country, the Pacific Northwest.

Katrina, I'm not making this stuff up. There is a real undercurrent out there of frustration in this country.

What does this mean, in your opinion? We see it in the blogosphere.

You see it in your reporting on "The Nation."

What's happening here, in your opinion?

KATRINA VANDEN HEUVEL, EDITOR, "THE NATION": Well, this is the passion, frustration, fury that we need to pay attention to. These are people who supported President Obama and who are seeking a more perfect union, which-universal health care, jobs, jobs. And I think this administration needs to wake up.

Now, Obama is calling a jobs summit. That suggests there is panic in Washington because they're looking at numbers. They're hearing from people.

"The Nation," like you, Ed, has been holding this administration's feet to the fire. We now need to lay out an agenda and fight for it hard, and make sure that the Democrats have a spine.

You were in the Northwest. I was just talking to my colleague, John Nichols, who is following me tonight. Peter DeFazio of Oregon has just introduced a piece of legislation-make Wall Street pay for the restoration of Main Street.

Small tax on financial transactions, on the bonds, on the equities, on the derivatives. Help rebuild a Main Street that has been ravaged by a bank bailout which this administration pushed through, corrosive, no demands on it. We need things like that now to move forward in a positive way so we hear from people less rage, but channeling this in a constructive way.

SCHULTZ: I would have to say that there is a lack of confidence across the country right now of core Democrats that there is going to be any kind of real strong public option that would hold the insurance industry's feet to the fire in real change. And the example was that gentleman that stood up last night who handed me the bill of $57,000, and only half of it is paid for by the insurance industry. A strong public option would change his life in that regard.

And I don't think there's a lot of confidence out there that we're going to get this thing done at this point.

VANDEN HEUVEL: I mean, Ed, the reality of what's happening in our country is we need, and the great community organizer, Saul Alinsky, talked about organized people versus organized money. We are seeing the mugging of the common good every day. We've talked about this on your program.

You have insurance companies drafting legislation. You have, as Bill Greider reports in "The Nation," financial institutions drafting regulatory reform.

We need people to understand that and fight hard. We may get a weakened public option. The question ahead of progressives, to be honest, is whether we're going to take this health care reform and build on it.

SCHULTZ: Yes.

VANDEN HEUVEL: Or do we turn it down? Because I think if we do that, the Democrats and-and, you know, I'm a progressive Democrat, but we go into 2010 with almost nothing and a lot of rage and anger loose in this country which needs to be channeled and can be if we can build.

SCHULTZ: Well, I think the crowd last night wants the president to be a little bit more aggressive. But he's not the problem.

VANDEN HEUVEL: No, it's the system.

SCHULTZ: And President Obama is very popular with progressives across the country. The point is, is that they think that the Democratic leadership and the conservative Democrats have left him to the side of the road when he went out and talked about change. He can't do it alone.

VANDEN HEUVEL: Well, we need President Obama to step up, though, too, Ed. I mean, you can talk all about self-righteous egotists like Joe Lieberman, and we can talk about the need for deep reform of the Senate, abolishing the filibuster. But I think it's time for President Obama to step up.

Do I want him to reengage with the world? Yes. Should he have left the United States at this critical moment? He did that in July.

SCHULTZ: Yes.

VANDEN HEUVEL: You know, this is a moment where he needs to be cajoling, as Lyndon Johnson would do, cracking some heads. Because I think if we don't get something before Thanksgiving, we're going to head into ugly periods, because these forces amassed against reform, they're amassing.

SCHULTZ: No doubt about it.

Katrina, thanks so much for joining us tonight.

VANDEN HEUVEL: Thank you.

SCHULTZ: You bet.

The Seattle audience also expressed concern about the economy, basically the double standard and the lack of regulation in the wake of the Wall Street bailout. That, of course, is another hot-button issue.

Fed Chairman Ben Bernanke talked about regulation today.

(BEGIN VIDEO CLIP)

BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: There's a sense here of, you know, returning to Glass-Steagall and separating these market-making activities from commercial lending. I think that kind of movement would not be constructive.

As we know, plenty of firms got into trouble making regular commercial loans and plenty of firms got into trouble in market-making activities. So, the separation of those two things per se would not necessarily lead to stability.

(END VIDEO CLIP)

SCHULTZ: Senator Byron Dorgan of North Dakota was one of eight in the Senate back in 1999 who voted against the deregulation. Let me bring in the senator.

Senator, great to have you with us tonight. And I know you've got another plan that is going to fix this mess.

It was 10 years ago that you stood up on the Senate floor and said, this isn't good, this could lead to a catastrophe, and that's exactly what happened. And the market is doing pretty well right now. Some of the money's been paid back, but Main Street has been left behind.

Senator, where do we go right now? What do you think?

SEN. BYRON DORGAN (D), NORTH DAKOTA: Well, Ed, first of all, I think the stock market is ahead of the economy, for sure. I mean, you know, we've got a long way to go to recover here. But it's very important for us to understand and to learn this lesson.

We need to make sure when we do financial reform that too big to fail means too big. And if they're too big to fail, we need to break up some of these firms, number one.

Number two, I think the chairman of the Fed is just dead wrong. We need to separate FDIC-insured banks from the investment banks. Separate them.

And finally, we need to make sure that FDIC-insured banks are not trading these exotic financial instruments on their own proprietary account, which they are now doing. They'd just as well put a craps table in their lobby. It's just gambling. So those are the things we have to do.

SCHULTZ: Senator, you're saying that Ben Bernanke is wrong. The White House follows his lead, so does the Treasury Department. It's like they're walking in lockstep here.

What exactly do you think should be done from a legislative standpoint to protect the American taxpayers that we don't go down this road again? Because I don't think we can go through this again and still maintain the financial system that we have in this country.

DORGAN: You know, I heard this same sort of thing 10 years ago from some of the same people-you've got to make all these changes in the name of modernization, allow investment banks and FDIC-insured banks to coexist in the same company. Just dead wrong. It was then, it is now, and I think we have to be aggressive.

We have to decide, you know what? When it costs you trillions and trillions of dollars to save the economy, and the big financial interests are driving it right into the ditch, make sure that you do things that will prevent it from happening again. Too big to fail-too big to fail means you're too big and we have to take action to address that.

SCHULTZ: And Senator, just reinstating Glass-Steagall, in your opinion, would that do it?

DORGAN: Well, the issue there is separating the commercial banks from the investment banks. That's what Glass-Steagall allowed to happen, to bring them together, and that turned out to be a catastrophe. So, let's go back and revisit that and do it right this time so that we don't get into this situation again.

This is the most expensive lesson in history. And by the way, there's never been a narrative done with the real investigation to find out who's accountable, who's going to be held accountable? In the old days when they robbed banks they wore bandannas. These days, they wear some gray suits. And some of those folks that were accountable made off with hundreds of millions of dollars.

SCHULTZ: Senator Dorgan, great to have you with us tonight. Thanks for speaking up.

DORGAN: Thanks, Ed.

SCHULTZ: Coming up, well, no matter where you look, there she is. All-American nobody Sarah Palin, she's pointing fingers at the McCain camp, telling Oprah how she defines porn. And it's pushed me to the edge.

John Nichols weighs in on that next.

Plus, Rudy Giuliani is just furious about the decision to try the alleged 9/11 mastermind in New York City. I'll tackle that at the bottom of the hour here on THE ED SHOW.

And we've got Senate Majority Whip Dick Durbin, senator from Illinois, in the house about where we're going to put these terrorists.

We're right back on THE ED SHOW. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW.

All-American nobody Sarah Palin has come down to the lower 48 to push her book, going on all the shows. Is she relevant?

Here she is on Oprah Winfrey's show today, dodging responsibility for losing the election last year.

(BEGIN VIDEO CLIP)

SARAH PALIN ®, FMR. ALASKA GOVERNOR: I think the reason that we lost, the economy tanked under a Republican administration. People were sincerely looking for change. Unfortunately, our ticket represented what was perceived as status quo, and so I don't think that I was to blame for losing the race any more than I could be credited with winning the race had I done a better job as the VP candidate.

(END VIDEO CLIP)

SCHULTZ: Well, if Palin's gunning for the White House in 2012, she's got a lot of work to do between now and then. A new poll shows 60 percent of the people don't think she's qualified to be president of the United States.

And here's what "New York Times" columnist David Brooks had to say about her this weekend...

(BEGIN VIDEO CLIP)

DAVID BROOKS, COLUMNIST, "NEW YORK TIMES": She's a joke. I mean, I just can't take her seriously. We've got serious problems in this country. The idea that this potential talk show host is considered seriously for the Republican nomination, believe me, it will never happen.

(END VIDEO CLIP)

SCHULTZ: Let me bring in A.B. Stoddard, associate editor for "The Hill," and also John Nichols, Washington correspondent for "The Nation" and contributor to the book "Going Rogue, Sarah Palin: An American Nightmare."

Great to have both of you with us tonight.

A.B., what's going on here? She's going to make a bunch of money.

She's going to do a tour.

What's it all mean for 2012, if anything?

A.B. STODDARD, ASSOCIATE EDITOR, "THE HILL": Well, I think it's interesting she's doing sort of a Wasilla two-step, where she's making all these charges in the book at the McCain campaign staff, which are being refuted by them and they're saying that it's fiction.

Meanwhile, on the "Oprah" show-and we'll see what she does on "Good Morning America," et cetera, this week-she's being charming and she's being humble, saying that if she was a better candidate, that she couldn't have won for the ticket no matter what. She wasn't-about Bristol's pregnancy, I was surprised to see that she said she didn't want to glorify teen pregnancy, she wanted to let everybody know that she was embarrassed and disappointed.

And I think that this is designed-obviously the book is designed to fire up her base and the shows are designed to sort of be a charm offensive. I don't think this is going to get her to Des Moines, Ed. We've talked about this.

I think it could help her continue to make speeches, make a lot of money doing that. And, perhaps, ultimately be a king maker for social conservatives if she goes for a run and then throws her support behind somebody else. Anything, of course, could always happen, but I don't know that this is-it's not very presidential to write tell-all books and get in fights with people. So I don't know that this is in her plan.

SCHULTZ: A "Washington Post"/ABC News poll, the question was, "Would you vote for Palin for president in 2012?" Nine percent said definitely, 53 percent said definitely not.

John Nichols, it seems to me that she's trying to distance herself from any mistakes that were made in the McCain campaign, basically saying to the American people, you know, if I do this in '12, it's going to be a heck of a lot different. That's what I'm taking.

What do you think?

JOHN NICHOLS, "THE NATION": Well, of course. They did lose, and so you would want to say you're going to do things differently.

But Also, Ed, I think you have to be conscious. That nine percent number in "The Washington Post" poll is devastating.

The reality is that people are very interested in Sarah Palin, but interested doesn't translate to votes. And she's doing nothing right now that I see as building up a base of support.

She's been very ill served by her publisher. If you read the book, I mean, the last thing you want to do if you're building yourself up as a candidate of the future is to spend hundreds of pages about whining about Katie Couric and Steve Schmidt and John McCain and everybody else. I mean, this is not a forward-looking moment. This is a backward-looking moment, and that's simply not what the Republican Party needs at this point.

SCHULTZ: Yes.

Here's Sarah Palin talking to Oprah today, and was asked about running in 2012.

(BEGIN VIDEO CLIP)

PALIN: I'm concentrating on 2010 and making sure that we have issues tackled as Americans to make sure that we're on the right road.

OPRAH WINFREY, TALK SHOW HOST: Would you even tell me if you were thinking about it?

PALIN: No, I wouldn't. No.

(APPLAUSE)

PALIN: But 2012? Trig's heading into kindergarten in 2010. I'm looking forward to that.

I'm looking forward to effecting positive change between now and then.

I don't know what I'm going to be doing in 2012.

(END VIDEO CLIP)

SCHULTZ: But, A.B. Stoddard, if she goes like she's gone to Michigan and some battleground states, and she helps people get elected or, should we say, she says, hey, I visited that candidate and he or she won, that does kind of build a ledger for her impact, does it not?

STODDARD: Oh, yes. No, she's already so influential, Ed.

She has a PAC. She's racing money. People love her.

And I think that she might not appeal to the center or to the left, but, of course, there's a very fired up Palin base out there. Don't mistake this. And I think she's going to work to build on that.

What's interesting, though, she confuses the bailout with the stimulus program. The bailout, of course, was supported by John McCain, and she's blaming for Obama for it, it happened under the Bush administration. She confuses her fact, and she's going to have to spend a lot of time getting ink about the fact that she's confusing her facts.

She's not talking about policy. She's not talking about solutions.

So she doesn't sound like a candidate to me now.

I do think though her influence will remain and perhaps spread if she keeps up with this battleground publicity tour. A lot of people love her, and she's going to make sure that they keep listening to her. Whether or not she becomes a real leader in the party for '10 and '12 is another question.

SCHULTZ: Yes.

And John Nichols, I guess history will write it that John McCain, the jury is still out whether he made a good decision or not.

NICHOLS: No, the jury's in. It was a bad decision. You pick your vice presidential candidate to add to the ticket, not to become a drag where you have to send her to third-tier (INAUDIBLE).

SCHULTZ: John Nichols, A.B. Stoddard, great to have you with us tonight. Thanks so much.

NICHOLS: Thank you.

SCHULTZ: Coming up, "The Drugster" has found a way to cross the line that even Michele Bachmann won't cross.

That's next in "Psycho Talk."

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: And in "Psycho Talk" tonight, Rush Limbaugh still comparing people to Hitler. Even "Psycho Talk" queen Michele Bachmann has said that's crossing the line.

Here's what "The Drugster" said.

(BEGIN VIDEO CLIP)

RUSH LIMBAUGH, RADIO TALK SHOW HOST: And by the way, the media tweak of the day, Hitler put people in jail to lower the unemployment numbers. Another media tweak, that's how Dachau started.

Look, this is Pelosi. She called us Nazis, swastikas during the Tea Parties. Now they calling us Tea Baggers. She said it's OK to put people in jail for not buying health insurance.

(END VIDEO CLIP)

SCHULTZ: That is "Psycho Talk."

Rush, you're wondering why Pelosi says people are running around town halls with swastikas? Maybe it's because your wing-nut buddies, the Tea Party heroes, were doing just that. We have the tape to prove it.

As for the putting people in jail for not buying insurance, well, let me tell you what the House bill actually says. If you don't buy insurance, you will be taxed so that the rest of us don't have to pay for your emergency health care. Then if you refuse to pay that tax, then you could go to jail, just like if you didn't pay your regular income tax.

That's it, Rush. You're flat-out wrong on this one again, and perpetuating that bogus Republican talking point, comparing Speaker Pelosi to Hitler, that is "Psycho Talk."

Coming up, batten down the hatches, folks. Holy smokes. Liz Cheney hinted that either she or daddy would make a run in 2012. I'll ask a former aide to the vice president what he makes of that.

Plus, fear-mongering former New York mayor Rudy Giuliani is stirring things up over this terror trial coming up in this city. I'm calling him out for his hypocrisy in a moment.

Stay with us. You're watching THE ED SHOW.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to "The Ed Show."

Right wingers are playing dirty again, relentlessly attacking President Obama's decision to bring five 9/11 suspects to New York City for trial. Former New York mayor Rudy Giuliani hammered the president on three different Sunday talk shows.

(BEGIN VIDEO CLIP)

RUDY GIULIANI, ® FORMER NEW YORK CITY MAYOR: First of all, it's an unnecessary advantage to give to the terrorists. I don't know why you want to give terrorists advantages.

And secondly, it's an unnecessary risk to the city of New York. It's part of Barack Obama deciding that we're not at war with terrorism any longer.

The Obama administration is getting away from the fact we are at war with these terrorists.

What the Obama administration is telling us loud and clear is that both in substance and reality the war on terror from their point of view is over.

(END VIDEO CLIP)

SCHULTZ: Rudy Giuliani, in my opinion, is in no position to talk about security. He's the guy that thought Bernard Kerik should head up the Department of Homeland Security.

Joining me now is Republican strategist Ron Christie. Ron, good to have you with us tonight.

RON CHRISTIE, REPUBLICAN STRATEGIST: It's nice to see you, Ed.

SCHULTZ: You and I are on the opposite ends of the spectrum on this one. What is your major reason why you think this is a bad move to try these suspects here in Manhattan?

CHRISTIE: As a lawyer, Ed, I can tell you that once you allow people who are in the United States, you afford them certain constitutional rights that they would not be afforded if they were overseas.

Now, take the case here of Khalid Sheikh Mohammed. He was an individual that the United States captured in Pakistan. He was taken to Guantanamo Bay, and the military tribunal system that was codified and put in place in 2005 and reaffirmed by the Congress earlier this year allows for terrorists to be tried as enemy combatants in a military tribunal.

Once you bring them into the states, Ed, we have different standards in the rule of evidence, they're allowed to file different petitions, and, of course, they are allowed to reveal the methods and the manner in which the way the United States gathers intelligence in open court.

SCHULTZ: All right, well put.

So you are saying that there is basically a better chance for this guy getting off in Manhattan, walking scot-free as opposed to a military court? That's basically where I think the conservatives are on this. Why in the world did we try Moussaoui here in the United States?

CHRISTIE: Because Zacarias Moussaoui was captured by the FBI in the state of Minnesota and he was arrested on an immigration violation. So he was someone who entered the United States legally, was on United States soil in Minnesota, and then of course was tried in Alexandra, Virginia.

The difference again between these two guys that a lot of people in the media like to obscure is the fact that Zacarias Moussaoui was found here in the United States, Khalid Sheikh Mohammed was found in Pakistan.

SCHULTZ: But the alleged crime was on American soil. And there's no difference there.

I want to focus on Rudy Giuliani because he was a witness in the Moussaoui trial, and he actually said this on the stand, "I was in awe of our system. It does demonstrate that we can give people a fair trial, that we are exactly what we say we are. We are a nation of law."

He's done a 180 on that. Are the Republicans and the conservatives playing this out for political gain, Ron?

CHRISTIE: No, Ed.

SCHULTZ: Basically, it seems like you're fear-mongering, not you, but the general conversation that there's a lot of fear mongering going on here, that our system isn't good enough to do justice to those who were killed on 9/11.

CHRISTIE: Ed, I think the difference what you have here is you're looking at Moussaoui, someone who was, again, arrested in Minnesota, brought to justice here in the United States, demonstrating that the United States has a very fair and equitable system of justice, but it's something entirely different than a terrorist who was captured on the battlefield and taken to Guantanamo Bay, and the United States Congress made sure to allow the use of military tribunals.

SCHULTZ: I want to make a correction. Giuliani was not a witness in the Moussaoui case. He made this comment when the case was going on was what I meant to say.

But the implication here is by many on the right including Giuliani is that we're not going to be as safe because this trial is going to be going on in America.

CHRISTIE: Yes, Ed, that's actually very true.

SCHULTZ: Isn't that a slam at all of the people that work so hard to keep this country safe?

CHRISTIE: No. And quite to the contrary, in fact, I would point you to Andy McCarthy who actually tried the blind sheikh in the 1993 World Trade Center bombings. What you had there, Ed, was a case where an individual was allowed in open court to say who his co-conspirators were, to talk about his network and talk about intelligence.

SCHULTZ: And don't you think the prosecutors have that figured out? They apparently aren't afraid to get justice and show the world that we can take the moral high ground and our judicial system works and we can prove that we are a fair country and still get a verdict.

You show me a guy going to the death chamber and I'll show you a guy going to the death chamber.

CHRISTIE: Ed, here's the difference. That very same trial that I was discussing, Usama bin Laden within a couple of days of this testimony and question took place, Usama bin Laden realized the means and methods the United States was using for intelligence. What did he do? He left Sudan and moved to Afghanistan to evade the United States.

(CROSSTALK)

SCHULTZ: So you're saying the possibility here is that some intelligence might come out in the prosecution that would make us less safe and the terrorists would see a new opening and they would hit us?

CHRISTIE: Ed, how much time do I have? I think you're-

SCHULTZ: Ron, respectfully, that is really a stretch in my world.

CHRISTIE: Ed, that is not a stretch. We're talking about methods and means-

SCHULTZ: I also think that it's really a slam on the president's intelligence. Here he is a constitutional lawyer. He knows it inside-out. Of course they think they can get a conviction here and they're not going to make the country less safe. That would...

CHRISTIE: Ed, how much time do I have? You're going to make New York City less safe. You're going to needlessly waste millions of dollars of taxpayer dollars for defendants who have already pled guilty, said that they wanted to be executed.

But yet and still the Obama administration wants to try people who have already indicated that they're guilty, bringing people into this country, giving then constitutional rights they're not afforded. It's absolutely a disgrace.

SCHULTZ: I think it shows the rest of the world that we can take the moral high ground and have a great judicial system and get a conviction. And that's probably what's going to happen.

Ron, it's good to have you on tonight. Thanks so much.

CHRISTIE: Always, Ed.

SCHULTZ: You bet.

Democratic strategist Todd Webster is with us tonight and Republican strategist John Feehery. John Feehery, why is it a mistake? I assume you agree with Ron.

JOHN FEEHERY, REPUBLICAN STRATEGIST: Ron Christie is absolutely right. I think it's not-I'm going to put the political hat on and not the legal hat, because you had Ron with the legal hat. Politically I think this is risky for the Obama administration. I don't know why they're doing it. I think that we are in a war with these guys.

But if you look at what happened in the Congressional votes, especially in the House of Representatives, they voted overwhelmingly to not let the terrorists into the United States because they know back home that it's very unpopular to bring terrorists back to the United States unnecessarily.

So I don't know why the Obama administration is doing this. I think that the president is thinking more like a lawyer, a constitutional professor, and less like an actual leader of the country.

SCHULTZ: OK, Todd Webster, are we less safe tonight because there's going to be a trial in Manhattan?

TODD WEBSTER, DEMOCRATIC STRATEGIST: No, that's the nervous nellies on the right fear-mongering and trying to whip up some fake controversies.

The reality is on 9/11 these terrorists attacked us at the World Trade Center because of our values and democracy and because of our freedoms.

And if we were to either abandon our legal process and leave them indefinitely in capture or to execute them with no trial, then we would not be any better than the terrorists who ascribed to a theocratic system of government.

This is about our rule of law and about the values of Americans and our constitution.

SCHULTZ: No doubt about it.

John Feehery, Moussaoui, he was a terrorist, wasn't he?

FEEHERY: As Ron Christie pointed out, he was on American soil and under violation.

SCHULTZ: Who cares where he was picked up? The crime was committed in the United States. And how come we didn't get hit during that trial?

FEEHERY: Well, that's a good question. I don't think Moussaoui was nearly the danger that KSM is or some of these other characters.

I do think if you're looking at this from a political standpoint this is very dangerous for the Democrats to do this. I don't know why the president is thinking-

SCHULTZ: What if they get a conviction? Is that going to be good for the Democrats?

FEEHERY: Well, I hope they get a conviction. I hope they do it without compromising our intelligence.

SCHULTZ: So John, you think that if we get a conviction that the Democrats will fare well at the polls on this?

FEEHERY: No, I'm not saying that, Ed. What I'm saying is politically this is dangerous for Democrats who voted overwhelmingly to not allow terrorists on our soil. I think that if we're going to get a conviction, these guys are guilty as sin and they deserve to be executed.

SCHULTZ: OK.

WEBSTER: And absolutely, let's do that. But let's prosecute them first, prosecute them to the fullest extent of the law. Don't just make them martyrs by executing them without...

FEEHERY: We can do that quite easily with a military tribunal. We certainly did that in Nuremberg. I don't know why we don't do that here.

WEBSTER: Well, because in this country the commander in chief is the elected president of the United States. He and his attorney general in his case make those decisions.

And despite Karl Rove's efforts to politicize the Justice Department and install his buddies in U.S. attorneys positions...

(CROSSTALK)

SCHULTZ: That's exactly the point I want to make, John Feehery is that what Rudy Giuliani says, he says the president's forgotten we're at war. What does he mean by that? We're on the verge of sending more troops to Afghanistan. We have a hell of a footprint in Iraq. We're still chasing down terrorists.

And because this decision was made to try these guys here in the United States, all of a sudden all of our efforts are out the window, and by the way, we've forgotten we're at war.

FEEHERY: I think the difference here is you have the civilian trial and then you have a military trial. This should be done in military court because these are prisoners of war. This is a war. They are war criminals and they deserve to be prosecuted under war courts, not through the civilian courts.

SCHULTZ: All right, one quick comment. Here's Liz Cheney talking about 2012. I want to switch gears to this subject and get your response. Here it is.

(BEGIN VIDEO CLIP)

BILL KRISTOL, EDITOR, "THE WEEKLY STANDARD": Sarah Palin would not have bowed to the emperor of Japan. She wouldn't have curtsied to him. So should we have an attorney general that's taking the extremely risky move of bringing Khalid Sheikh Mohammed to New York? I don't know.

LIZ CHENEY: You could look at the comparison and think Cheney 2012.

KRISTOL: Yes.

(END VIDEO CLIP)

SCHULTZ: Pretty good promotion there, I'd say, huh, Todd Webster?

Always throw the name out. What do you think?

WEBSTER: I think would be fantastic. He's experienced, he's tested.

He would be a fantastic Republican nominee in 2012.

If you look at what Republicans do, they pick the old guy whose turn it is. If you look at Reagan in 1980, Bush in 1988, Dole in '96, McCain in 2004, he would be the Republican primary voters' perfect choice for the old guy whose turn it is to be elected. So I think he would win the Republican primary.

SCHULTZ: John Feehery, I thought she was talking about herself, not her dad.

FEEHERY: Well, I think she would be a terrific candidate. I think the vice president would love to have Todd Webster's endorsement when he runs for president.

SCHULTZ: All right, the president of-

WEBSTER: In the Republican primary, no question.

SCHULTZ: All right, a lot of talk about this. Here's the president of the United States bowing to the emperor in Japan. And just for the record, a bow is not unusual. It's considered appropriate, not necessary. It's routine gesture in that country. It really has no fixed meaning other than to show respect.

What's the big deal, John Feehery?

FEEHERY: You know what, Ed? I don't really know if there's much of a big deal. I think he was showing respect. I can't get on my moral high horse on this one, I'm sorry.

SCHULTZ: All right. Todd Webster?

WEBSTER: I would have to agree. He's greeting a foreign leader. I think it is less offensive than giving a big smooch to the Saudi Arabian prince who was over at his house and then walking hand in hand around the ranch in Texas.

But I think he's showing respect and he is in Japan, and it was a perfectly reasonable gesture.

SCHULTZ: And John Feehery, I want to thank you for saying we're not less safe because President Obama bowed to the emperor of Japan. Thank you.

All right, coming up, we know the righties don't want the Gitmo detainees to be tried on the mainland, but the Senate majority whip says, look, I'm not only trying them on our soil, but let's bring them into our backyard. He'll tell us about that in the "Main Event."

Stay with us. We're right back with "The Ed Show."

(COMMERCIAL BREAK)

SCHULTZ: And in my "Playbook" tonight on "The Ed Show," big Pharma is promising to support Washington's health care plan by cutting $8 billion a year after drug costs.

OK, but you see last year they raised the wholesale price of brand name prescription drugs nearly nine percent, and that of course would add more than $10 billion to the nation's drug bill. So how's this working out?

And it's by the way the highest rate of inflation for drug prices since 1992.

Joining me now is former vice president for corporate communications at Cigna, Wendell Potter. Mr. Potter, good to have you with us.

Is this just a page out of the back of the playbook that we knew was coming all along?

WENDELL POTTER, CENTER FOR MEDIA AND DEMOCRACY: Absolutely. It's no surprise to me, and I think no surprise to you. And this is what I warned about in my Senate testimony back in June to watch out for. These guys never had any intention of being good faith partners with the president and with Congress, and now we're seeing the evidence of that.

SCHULTZ: So the president and the White House, are you willing to say they've made a calculated mistake thinking that big Pharma was going to be able to walk them down the aisle of savings to the tune of $8 billion?

POTTER: I think the president and members of Congress as well, too, thought that they might be able to work with big industries to keep them from going nuclear. I heard that a lot back in the early part of the debate.

But they were fooling themselves if they thought that this wouldn't happen toward this part of the debate. They never had any intention of doing anything that would hinder their ability to make profit.

SCHULTZ: So what's it going to be like if this doesn't kick in until 2013? We're looking at a number of years of increases which really, unless there's real fundamental reform and absolute direct competition to the private sector, all of this could be for not.

POTTER: Well, it could be, because what these companies, what these industries are doing is to make sure they will continue to be able to reward their shareholders and meet those relentless profit expectations.

So that's what we're seeing here, and that's exactly why you're seeing price increases right now, because they want to lock in those increases. They might be able to say at the end of this that they have given something back, but it will actually be nothing at all. They'll be-it will be kind of a wash if you get to that point.

SCHULTZ: Mr. Potter, what you know of health care reform right now, what was passed on the House side and what they're talking about on the Senate side, is this reform?

POTTER: It can be reform. And I think there's a good chance it can

still be reform. The House bill has some very good elements to it, and for

one thing the public option will be strong enough if it survives as in the

House bill to at least be a viable option to keep these insurance companies

honest.

And I think there are some other elements that will change the playing field to help ordinary Americans be able to get the coverage they need. It's not exactly what we need, but I see this as a beginning of reform.

SCHULTZ: OK, so you would take what we could get at this time and go get more seats in the midterm and 2012 and just continue? This is the start of what is going to be a generational process, that's what I'm hearing.

POTTER: It really is, a generational process.

SCHULTZ: We carried a story last week about United Healthcare, about how they're telling employees to lobby the Congress, all 75,000 of them. Do you think other companies are going to do that? And is this standard operating procedure?

POTTER: It's standard operating procedure. And they are already doing that. I guess United was the only one that came to public light. But it's something that all the companies have done. The two that I worked for did this on a routine basis. It's something that goes on and, as an employee, you are expected to follow what you're asked to do.

SCHULTZ: Mr. Potter, great to have you with us tonight, thank you.

POTTER: Thank you very much, Ed.

SCHULTZ: Last couple pages in the "Playbook" tonight-General Motors announced today that it's hitting the accelerator on paying back its $6.7 billion worth of loans to the federal government, loans, right?

Even though they lost more than $1 billion in the third quarter of this year, GM says that the loss was actually better than expected and the company plans to make their first loan payment of $1 billion next month. That's five years before the loans are due. And they say they'll continue to make similar payments every quarter after that.

And I have to throw this in. The Vikings just know how to make it look easy. Brett Favre on his 300th consecutive start and another big day, 20 out of 30, a bunch of yards, this touchdown pass off the play fake. The Vikes at 8-1. Up next, Seattle in the Metrodome this weekend.

Coming up in the "Main Event," Senate Majority Whip Dick Durbin of Illinois is going to be here to explain bringing the detainees to mainland could be a boom for the economy in his state.

You're watching "The Ed Show" on MSNBC. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to "The Ed Show."

President Obama is considering a plan to move Guantanamo Bay detainees to the United States mainland. The plan would call for moving 100 detainees to the Thompson Correctional Center in northern Illinois. It would play a large role in play in closing Gitmo and create almost 3,000 new jobs in the area.

But of course the fear-mongering and Republicans are fighting this hard against any possible transfer by saying, of course, that this is going to make us less safe.

Joining me now in the Senate is Senate Majority Whip Senator Dick Durbin of Illinois. Senator, good to have you with us tonight, thanks so much.

SEN. DICK DURBIN, (D-IL) SENATE MAJORITY WHIP: Good to be with you, Ed.

SCHULTZ: You bet. Is this the right thing to do? Are you in favor of this?

DURBIN: I sure am. I don't stand alone. General Colin Powell said if he had his way he wouldn't close Guantanamo tomorrow, he's close it this afternoon because it's a danger to our troops.

The Defense Secretary, Robert Gates, who has served President Bush and now President Obama says the same thin thing.

When you listen to General Petraeus and the people who are watching this war against terrorists unfold, they understand that the sooner Guantanamo is closed the safer our troops will be. That's why I support this administration's position.

SCHULTZ: McCain, McConnell, Boehner, you know, all the leaders over there on the right are saying that this is the wrong thing to do. Is it a security risk in any, way, shape, or form? We would have terrorists, alleged terrorists on our soil.

DURBIN: Well, 350 convicted terrorists are currently serving in American prisons, 35 of them in the state of Illinois. In fact, just a few months ago, an Al Qaeda-connected terrorist was convicted and incarcerated at the federal penitentiary in Marion, Illinois, without a stir. No one even noticed because there are many dangerous people there, and they're being safely and securely held.

The same thing will be true at this Thompson facility if the Obama administration chooses it. It will be the most secure super max prison when it comes to these Guantanamo detainees in the United States. There's never been an escape from one of these prisons.

And the arguments that I hear, Ed, from the other side, it really is terrible, the fear mongering. You described it as such. This notion these Guantanamo detainees will be released in the United States? We didn't vote once. We voted twice and the president signed the law that prohibits that from happening.

So this kind of fear mongering isn't helping us in bringing this country together.

SCHULTZ: And what about the trial that's coming up to have the five defendants being tried here in Manhattan? Is that the right move as well?

DURBIN: Well, just look at the record. Since 9/11 we have convicted 195 for terrorism in the courts of our land using the same courts in New York and other places, successfully convicted them and incarcerated them.

In the same period of time we have successfully convicted three in military tribunals, 195 to three.

The Justice Department believes it has a better chance of putting these people behind bars for the rest of their natural lives by going through our court system.

And it says to the world we're going to do this openly, do this the same way we do for the Americans, and we believe these people have to answer for the misdeeds and tragedy they brought to our country.

SCHULTZ: Let's talk health care for a moment, Dick if we can. Are you going to get the 60 votes?

DURBIN: We're working on it, struggling. I just left a meeting. We need to bring our 60 Democrats together. And of course, there are differences of opinion on critical issues like the public option.

But I think we all understand we have a historic opportunity and historic responsibility. To leave this field of battle empty-handed is a terrible error and real misfortune for our country.

We cannot sustain our current health care system. It is entirely too expensive. Businesses are dropping coverage. People can't afford coverage. The health insurance companies run roughshod over people when you need them the most. We have to change the system.

SCHULTZ: We have to change the system and we have to have some competition for the private sector. That, of course, has been the sticking point for a lot of conservative Democrats. Getting the 60 votes is going to be tough. Are we going to have a public option if your opinion?

DURBIN: I want one and I think Harry Reid showed real leadership and

wisdom when he put an opt out provision in that basically says if your

state doesn't want to offer this option to the people living there, doesn't

want them to have this choice of a not-for-profit health care plan, you can

vote out of the system

It is as straightforward as can be. It doesn't impose it on them. It gives them their own choice in their future.

SCHULTZ: Senator Durbin, great to have you with us tonight.

DURBIN: Thanks, Ed.

SCHULTZ: Thank you, you bet.

This our I asked you, should the U.S. move Gitmo detainees stateside, and 94 percent said yes, six percent of you said no.

That's "The Ed Show." I'm Ed Schultz. For more information, go our Web site at WeGotEd.com. Chris Matthews and "Hardball" is next right here on the place for politics, MSNBC. We'll see you tomorrow night.

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

END

Transcription Copyright 2009 CQ Transcriptions, LLC ALL RIGHTS RESERVED.

No license is granted to the user of this material other than for research.

User may not reproduce or redistribute the material except for user's

personal or internal use and, in such case, only one copy may be printed,

nor shall user use any material for commercial purposes or in any fashion

that may infringe upon NBC and CQ Transcriptions, LLC's copyright or other

proprietary rights or interests in the material. This is not a legal

transcript for purposes of litigation.>

 

Discuss:

Discussion comments

,