updated 9/21/2010 11:57:58 AM ET 2010-09-21T15:57:58

Guests: Rep. Steny Hoyer, Ron Christie, Katrina Vanden Heuvel, Joe Madison,

Scott Hennen, Eric Burns, Mike Papantonio

ED SCHULTZ, HOST:  Good evening, Americans, and welcome to THE ED SHOW.  Tonight, live from the nation‘s capital, Washington, D.C.

These stories are hitting my hot buttons and on the table at this hour:

Well, here comes the tan man and his Republican cronies—they‘re ready to roll out their new contract with America‘s billionaires.  My commentary on that.

Plus, reaction from majority leader in the House, Steny Hoyer.  He‘s with me off of the top tonight in just a moment.

Senate minority leader, Mitch McConnell—I think this guy ought to watch his back.  I think he‘s about to get Waterlooed by Tea Party kingmaker, Senator Jim DeMint.  I think there‘s something cooking here.

Tea Party darling Christine O‘Donnell admitted she dabbled in witchcraft and once had a picnic on a satanic altar soaked in blood?  Am I reading this correctly?  What were they have done with Barack Obama if this was the case?  We‘ve got talk about it.  I‘ll tell you the lies that they‘re pushing about the president.  And, of course, we‘ll have that in “The Playbook.”

But this is the story that has me fired up tonight in the nation‘s capital.  Now, at this hour, the Republicans are down the street and they‘re cooking up this scheme, let‘s say they want to cut Social Security, so we‘re all straight on this now.  If they get the majority, they want to cut Social Security, they want to protect the tax cuts for the billionaires, and they want to choke off the funding of health care reform that—let‘s not forget—is saving lives.  Now, this is all part of this brand-new contract with America for 2010.

Now, the tan man and his other GOP leaders will unveil this contract in a very interesting place.  At a hardware store in Virginia, which probably carries a bunch of Chinese tools, Boehner‘s buddy, House Minority Whip Eric Cantor, he launched a preemptive strike on the Democrats in an op-ed in today‘s “Wall Street Journal.”

And he writes, “The progressive left end game is very simple.  This comes—first comes the provocative class warfare rhetoric.  Second comes the vast assumption of government control over the economy.  Third comes the growth of government spending and entitlements, and higher taxes on our nation‘s job creators and workers.”

You know what?  I‘ve got to give the guy credit.  He knows what the playbook says.  Cantor is grabbing at straws—crying about class warfare, my friends, is one of the oldest arguments in the book.  The Republicans and the top 2 percent have been economically carpet-bombing the middle class in this country for the last 30 years.  But they bellyache about class warfare anytime their tax cuts are in jeopardy?

Hold it right there.  I thought we were concerned about the budget.  I thought we were concerned about the fiscal responsibility of this country.  Ask yourself the very basic question, have these tax cuts that went in under Bush, how many jobs have they created?

Let‘s not forget for the last seven months, we‘ve added jobs to our economy.  We‘re headed in the right direction.  We‘ll talk political strategy for the Democrats in just a moment.

But check out former talk show host and Indiana congressman, Mike Pence, who took a swipe at Speaker Nancy Pelosi during the Value Voter Summit.

(BEGIN VIDEO CLIP)

           

REP. MIKE PENCE ®, INDIANA:  A recession is when your neighbor loses his job.  A depression is when you lose your job.  And a recovery is when Nancy Pelosi loses her job.

(CHEERS)

(END VIDEO CLIP)

SCHULTZ:  You know, they‘re just so neighborly about the whole thing, aren‘t they?  What Mr. Pence has to realize is that what‘s really being a mean neighbor is stopping every job initiative that the Democrats have put on the table.

Now, the Republican Party has offered nothing to this country in the last 22 months, except this two-word culture, “no way.”  So, the “party of no” is what they‘re called now.  They have fought the president of the United States—let‘s see—on the stimulus package, they didn‘t like Wall Street reform, they didn‘t want anything to do with health care reform, and everything else that you can think of.

Now, they‘ve got the audacity to announce that they‘ve just got these ideas and they‘re going to throw it out at a small business in Virginia?  It‘s interesting—I‘d like to talk to the owner of this small business and ask him how he feels about tight credit.  I‘ll tell you what?  They must have really looked long and hard to find this small business owner to work with the Republicans on this one.

Republicans have voted against every small business plan President Obama has put on the table.  At the same time, the Republicans are also introducing a number of Tea Party ideas in their contract.  One Tea Party demand is: every law must meet constitutional authority.  Sound familiar?

Check out what Tea Party Alaska Senate candidate Joe Miller classifies as unconstitutional.

(BEGIN VIDEO CLIP)

JOE MILLER ®, ALASKA SENATE CANDIDATE:  We had an extension of unemployment benefits several weeks ago which is beyond what we‘ve had in the past in this country.  I think we as a people need to stop being disingenuous about what the Constitution provides for.  It does not provide for this all-encompassing power that we‘ve seen exercised over the last several decades.  It‘s what‘s gotten us into this bankrupt position.

(END VIDEO CLIP)

SCHULTZ:  And what does this say about international intervention?  Do you want to go down that road, Mr. Candidate from Alaska?

Some reason, Democrats—and let‘s focus on the money in just a moment.  For some reason, the Democrats have allowed the conservatives to outmaneuver them when it comes to fiscal responsibility and that whole conversation.  Keep in mind, I‘ll say this every night before the rally and every night before the election, we got into this mess under their watch.  We got under this mess and damn near went bankrupt because of the hundreds and billions of dollars that we spent on a war and nobody had any idea how the hell we were going to pay for it.

These massive tax cuts for the superrich in this country is what‘s got us where we are.  And the Congress rubber-stamped every dime the former president demanded for the war in Iraq, and voted over and over again for the Bush tax cuts, and cut deals.

I wonder how Ben Nelson feels about that $18 million he got for homeland security as the they bought his vote so he could make Omaha a hell of a lot safer.  By the way, we haven‘t been hit on President Obama‘s watch either.

The Democrats have got to get it together and get it in gear, and sell

sell hard to the American people and don‘t back down if they‘re going to keep the majority.  They need to take care - take care—of America‘s unemployed.  Get some money to the hands of small businesses, which they are slowly doing, protect the tax cuts for the middle class, and end this free ride for the top 2 percent and fully fund the health care law and don‘t let anybody get in the way of saving somebody‘s life.

           

Now, this is a message that I‘m going to be given on the steps of the Lincoln Memorial at the “One Nation” rally Saturday, October 2nd.  It isn‘t a stunt.  It‘s not for a comedy hour.

It‘s about people‘s lives, and it‘s about people coming together, and it‘s about people being focused on what we have to do as a country to turn this around.  Nobody came in and waved a magic wand and now we‘ve got everything perfect.  We have to work at this.

Get your cell phones out, folks, I want to know what you think about all of this.  Tonight‘s text survey question is: If the Republicans regain power, do you believe it will make your life better or worse?  Text A for better, text B for worse to 622639.  We‘ll bring you the results later on in this show.

Now recently, I‘ve been asking questions about: where are the Democrats going to go on the campaign trail when it comes to selling.  I‘m somewhat dismayed that some Democrats are actually running away from health care reform on the campaign trail.

Let‘s talk to that situation with House Majority Leader Steny Hoyer.

Mr. Leader, great to have you with us tonight.

REP. STENY HOYER (D-MD), HOUSE MAJORITY LEADER:  Good to be with you, as always, Ed.  Thank you.

SCHULTZ:  Isn‘t it a good thing to be able to go home and say that we are saving lives with this health care reform that we passed?  Isn‘t this a historic move?  Yet, are there some Democrats that are running from it.

Steny, why is that happening?

HOYER:  Well, I think that the American people express concern about health care.  However, as you know in the debates, both McCain and Obama said, if elected, they needed to reform the health care system.  They‘ve changed their opinions.  Senator McCain has seemed to have changed his opinion.

However, we know that 50 million Americans without health insurance is costing our nation and is putting risk—lives and health care at risk.  We‘ve adopted a system, Ed, that for some reason, people say is smacks of socialism.  It‘s an interesting thing.

What we did was: we created market so that private sector insurance companies can transparently offer their products and services to the American people.  It seems to me that‘s pretty much the American way.  And what we‘re ensuring is that all Americans will have access to affordable health care.  And if they have trouble, we‘re going to help them.

And what CBO says is that we‘re going to save $175 billion through that program over the next decade.  And the decade after that, save $1 trillion.  And as I point out on—

SCHULTZ:  Congressman?

HOYER:  Yes?

SCHULTZ:  All of the things that you‘re talking about, you‘re absolutely spot on.  But there are some Democrats who are going back to their district and they seem to be afraid to say that.  In fact, there are some who‘ve taken out ads saying that they didn‘t have anything to do—they didn‘t support the health care reform and they‘re actually running from it.

HOYER:  Well

SCHULTZ:  What is—what do you make of that?

HOYER:  Ed, the fact of the matter is, obviously, each candidate campaigns on what they believe.  But clearly, our party and the president has put forward a plan, which we believe was—is good for the country, good for the health care of our people and—

SCHULTZ:  No doubt.

HOYER:  -- it will save us money.  So, from all of those standpoints, we think it‘s a program that will work.

Now, we have three years to make it better before it fully goes into effect.  But let me tell you, there‘s nobody that I‘ve talked to that doesn‘t want to make sure that insurance companies can‘t tell them, “No, sorry, we‘re not going to insure you and your family because your child has diabetes or asthma,” or you‘re not going to be precluded from changing and going into business and creating a business of your own and jobs simply because you have a pre-existing heart condition and won‘t be able to get health care.

SCHULTZ:  So—

HOYER:  We think this is a very significant, positive step forward, and we think over the years, Americans are going to come to that conclusion as well.

SCHULTZ:  And the case has to be made, undoubtedly, to the voters, that the Republicans—if they get the majority—are going to reverse all of this and wipe it right out.  This legislation saves lives.  They want to wipe that away all for the god almighty dollar.  Now, let‘s talk about the money.  Why—

HOYER:  Ed, can I just say something on that?  Let me just say something because an awful lot of the Republicans are campaigning.  They want to repeal.  The American public, however, have made it very clear—they don‘t want to repeal.  They want to make it—

SCHULTZ:  Yes.

HOYER:  -- as good as they can, but they don‘t want repeal.

SCHULTZ:  What about the Bush tax cuts?  Why are so many Democrats caving in on the Bush tax cuts?  Why isn‘t it a strong strategy to go home and say, we think the super wealthy needs to pay more and the middle class folks deserve the tax cuts?  Why is that such a hard case to make?  Yet, there are so many Democrats that are caving in on this.

HOYER:  Well, (a), I‘m not so sure how many Democrats are taking the opposite position.  But we‘ve made it very clear in the House and in the Senate, among the leadership, and the president‘s made it very clear, we‘re going to make sure that the middle class workers do not get a tax increase.  However, the deficit is looming large.  That is a significant concern of ours and those who can help pay and bring that deficit under control need to.  And it‘s not going to adversely effect the economy.

The president of the United States—and this is frankly been Republican policy since I got to Congress 30 years ago—Republican policy has been to cut taxes on the wealthiest in America.

SCHULTZ:  Yes.

HOYER:  And they would grow jobs.  In fact, they opposed a program in ‘93 that Clinton plan, and said that it was going to blow a hole in our economy because it raised taxes on the upper 1 percent of America.  In fact, as you know, that was the best job creating period in our lifetime under President Clinton‘s economic program.

SCHULTZ:  Congressman, now, there‘s been a lot of conversation about the suggestive political strategy to go out there and connect the Tea Partiers with the GOP.  Do you agree that that is the right way to go, or would you shy away from that?

HOYER:  Let me tell you, the GOP is connecting itself for the Tea Party positions.  So, we don‘t have to connect them ourselves.  The Republican candidates are doing that already.

And when you have people saying, we ought to do away with Social Security, that, as you just pointed out Mr. Miller, unemployment insurance is somehow unconstitutional, that we want to go back to the policies that failed so badly, not only in the last administration, but previously, to bring our deficit—

SCHULTZ:  So the GOP and Tea Party—so, Steny, the GOP and Tea Party are in the same sentence?  You can‘t parcel them out?

HOYER:  I think it‘s clear that you see the Republican Party being very closely aligning themselves with the positions of the Tea Party—

SCHULTZ:  Yes.

HOYER:  -- and their candidates.

SCHULTZ:  And—

HOYER:  And very frankly, it‘s clear that those candidates are having great success in their party.

SCHULTZ:  And, finally, what are you going to do to get the base out?  There‘s conventional wisdom out there that the Democratic base is somewhat deflated because the majority didn‘t go far enough.

Now, I know you guys in the House passed a bunch of bills, you passed a bunch of bills in the House.  The Senate is a totally different animal.  It‘s bane record number of filibusters.

What are you going to do to motivate the base to show up?  Because if they don‘t show up in droves, you stand to lose the House in the Senate.  What do you say to the base?

HOYER:  There‘s no doubt that our base needs to come out.  And our base needs to come out because we‘re really at halftime here.  We‘re not at the end of the game.

The president rightfully says, we found ourselves in a very, very deep ditch, the deepest ditch that we found ourselves in our lifetime, Ed.  And the president and the Congress have been trying to dig out of that ditch.

And as you pointed out, we‘re making progress.  The stock market is up 60 percent, that means, retirement savings are up—

SCHULTZ:  Yes.

HOYER:  -- 60 percent.  You pointed out in all but one of the last eight months, we gained jobs in the private sector.

SCHULTZ:  Yes.

HOYER:  We gained more jobs as opposed to 3.8 million jobs being lost in the last year of the Bush administration.  So, yes, it was a deep hole and we‘re digging out, but we still need to keep on focused on creating jobs.

SCHULTZ:  You got the base to come out, don‘t you?  You have to ask—

HOYER:  We have to ask our base to come out.

SCHULTZ:  Steny Hoyer, great—

(CROSSTALK)

HOYER:  And very frankly, let me tell you another thing that I think is happening, Ed, because I think the independents, the Gallup Poll came out today.  Democrats are now 1 point up in the Gallup Poll.

SCHULTZ:  Yes.

HOYER:  And I think what‘s happening in this country is independents are looking at the alternatives, whether it‘s Tea Party candidates or Republican policies, with respect to privatizing Social Security.

SCHULTZ:  Yes.

HOYER:  Retreating from regulation of the banking industry—

SCHULTZ:  I think they‘ll figure it out, congressman.

HOYER:  I think that they‘re figuring it out and I think they‘re coming our way.

SCHULTZ:  I think that they‘ll figure it out.  Great to have you with us, Steny Hoyer.

HOYER:  Always great to be with your, Ed.

SCHULTZ:  You bet.  Appreciate your time.

Coming up, psycho Tea Partier, Christine O‘Donnell, admits to a witchcraft past—believe it or not—including a date at a satanic altar.  This has the kids over at FOX News laughing.  But truly scary thing is how she used her power if she wins in November.

And false prophet Glenn Beck told his audience they are winning because President Obama and the family went to church over the weekend.  Hey, Beckster, I‘ve got something for you to pray about.

All of that and plus we‘ve got Newt goes off on the rails.  Caribou Barbie will give if a shot in 2012.  And I‘m going to Monday evening quarterback in the “The Playbook.”

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Coming up: let‘s face it, progressives who had some disappointments with the White House.  But, folks, listen up, if we don‘t come together to fight off of the Republicans right now, the tan man‘s going to be taking charge.

Katrina Vanden Heuvel, editor of “The Nation,” says we need to eat, pray and vote to avoid Speaker John Boehner.  And she‘ll give us a plan in “The Battleground.”

Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. JIM DEMINT ®, SOUTH CAROLINA:  Washington has treated Americans like they were stupid for too long.  November the 2nd, you‘re going to see who‘s stupid and they‘re going to be out of Washington, and you‘re going to be back in.

(END VIDEO CLIP)

SCHULTZ:  Well, Senator Jim “Waterloo” DeMint of South Carolina is predicting a Tea Party takeover in November.  And Senate minority leader, Mitch McConnell—buddy, you better watch your back.

DeMint‘s got plans.  He is right now the face of the conservative movement in this country and he‘s winning.  He‘s leading these long-shot candidates to victory with tremendous counsel.  You‘ve got to hand it to him.

The media sees him as the link between the GOP and the Tea Party.  DeMint says Tea Partiers aren‘t Republicans and don‘t want to be Republicans.  I don‘t believe that.  But he says he‘s willing to arrange, I guess, you could say a marriage of convenience to knock out the Democrats in the midterms.

But if the Republicans win control of the Senate, I am convinced that DeMint is going to hand over the keys to the kingdom to McConnell.  I don‘t think he‘ll do it—unless he has a big, big role to play in the Republican Party.  I think DeMint‘s going to end up being the leader.

For more, let‘s bring in former assistant to George W. Bush—Dick Cheney and George Bush.

RON CHRISTIE, REPUBLICAN STRATEGIST:  Nice to see you.

SCHULTZ:  I‘ve wanted to go face to face with you on so many issues for so long.  I‘m in New York, now we‘re in Washington.

CHRISTIE:  We‘re here.  Let‘s do it, Ed.

SCHULTZ:  All right.  Jim DeMint in many respects is the leader of the party right now.  Is that a fair statement?

CHRISTIE:  I think he is the leader of the conservative party, no question.

SCHULTZ:  Has he had more victories than McConnell?

CHRISTIE:  I think that he‘s been very successful, along with Governor Palin, of recruiting people, as you said, long-shot candidates—people that were ignored by the mainstream, ignored by the establishment Republicans.  And they won.

If you look, it‘s been very impressive—Alaska, South Carolina, what we saw in Delaware.  Jim DeMint has been time mobilize people, get them to the polls and make sure that these candidates have the money to win.  I think he‘s been very successful.

SCHULTZ:  But now, you‘re stuck with these candidates, and they‘re saying some pretty outlandish stuff, very radical.  How do you mix them into the GOP?

CHRISTIE:  I think that a lot of these people who ran and won represented a movement.  Delaware is a perfect example.  People are saying all these things about Christine O‘Donnell in saying that she‘s out of the mainstream.  I think that Congress and this president are out of mainstream with where the American people are.  She won, Ed, fair and square.

She took on—

SCHULTZ:  Sure.  She won a primary.

CHRISTIE:  She took on a guy who‘d been in office as long as I‘ve been alive, since 1969 and she beat him.

SCHULTZ:  So, you think it‘s a movement, even with low voter turnout.  You think it‘s actually a movement and telling the Republican Party, you‘ve got to go further right?

CHRISTIE:  I think it‘s telling the people in the Republican Party, we‘ve had enough.

SCHULTZ:  OK.

CHRISTIE:  We‘ve put you in office in 1995 --

SCHULTZ:  But they are Republicans, aren‘t they?  The Tea Partiers are Republicans.  They‘re not Democrats.

CHRISTIE:  I think a lot of the Tea Party people, you could call them conservatives.  I don‘t even think they would call themselves Republicans.  I think that they are tired of the traditional two-party system that we have over here in Washington.

SCHULTZ:  OK.  Well, isn‘t Christine O‘Donnell your worst nightmare?  I mean, this satanic stuff.  I mean, every day, there‘s a new chapter in her life coming up in a new psycho statement that‘s out there.

Now, if that were President Obama during the vetting process, I mean look how the conservatives play the Reverend Wright stuff over and over again.  Now—I mean, you‘re embracing a witchcraft candidate.

CHRISTIE:  Well, I think that‘s a lot nonsense.  I think you know—you‘ve seen the comments—look, it‘s nonsense.  People in the state of Delaware have to make the determination is she going to best represent our interest in the Senate?

I‘ll tell you one thing, though—she doesn‘t want government-run health care.  Castle was for it.  She wants to reduce the size of government.  She wants to cut taxes.  I think she is more in line with her ideological perspective than Mike Castle was representing the people in Delaware.

SCHULTZ:  OK.  So, but she still has this baggage.  You admit she has baggage.

CHRISTIE:  Everybody has baggage.

SCHULTZ:  Not like this.  I‘ve never heard like this before.

CHRISTIE:  OK.  Look, I read the president‘s autobiography.  We could go back and say the president used drugs, talked a lot about his drug use.  You gave him a pass on it.

SCHULTZ:  This is—this is the point is that the conservatives seem to parcel out, you know, the bad guys in their world and accept anybody that can just win some kind of election or movement even when it‘s low voter turnout.  How are you going to control these people?

CHRISTIE:  I think what we‘re going to do—well, we‘re not going to control them.  This is a movement.  That‘s the beauty of the Tea Party.  This is a real movement.  These are people who are angry about the scope of government and said, “You people in Washington aren‘t listening to us.”

You know, I read something this weekend, Ed, that said, the primaries that we‘ve had through last Tuesday, you had 17 million Republicans go out and vote and you had 15 million Democrats go out and vote.  I think if the Democrats can‘t mobilize their base and get people to turn out we‘re going to trounce the Democrats here in Washington.

And I think that‘s what the Tea Party has done.  They have galvanized people who have government is out of touch and they‘re listening to go out and vote.

SCHULTZ:  There are independents out there that are saying, what happened in Delaware?  Is this what we‘re going to get?  She‘s dangerous.  And I find it amazing that the Republicans are out there defending her and Karl Rove was correct and I think you know that.

We‘ll do it again, Ron.

CHRISTIE:  Pleasure.  Always good to see you.

SCHULTZ:  Coming up: “Psycho Talk” and Republican hack, Jack Burkman‘s racist rant on FOX was so bad that a fellow righty went postal on him.  I‘ll deliver Jack into “The Zone,” next.  You won‘t want to miss it.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  And in “Psycho Talk” tonight, Republican political analyst Jack Burkman‘s racist outburst towards U.S. postal workers, that‘s the story in “Psycho Talk.”  During a discussion on FOX Business about privatizing the post office, Burkman got personal.

(BEGIN VIDEO CLIP)

JACK BURKMAN, GOP STRATEGIST:  Most of these guys working in the post office should be driving cabs and I think we should start—stop importing labor from Nigeria and Ethiopia.  That‘s about the skill level.  They‘re only in there because of massive union protection.  That is why I allege they should be bunked down to driving cabs and we should stop importing labor to drive cabs.

(END VIDEO CLIP)

SCHULTZ:  You know, I could tell you what a psycho statement that is.  But the former Republican senator from New York, Al D‘Amato, he did it for me.  I‘ll let him take this one.

(BEGIN VIDEO CLIP)

AL D‘AMATO ®, FORMER SENATOR FROM NEW YORK:  You are a nasty racist.  Let me just tell you, that‘s a bunch of bull (EXPLETIVE DELETED).  And you should be ashamed of yourself and have your mouth washed out.  What the hell are you talking about?

It‘s one thing to you say that they‘re out—

BURKMAN:  We are importing.

(CROSSTALK)

D‘AMATO:  Wait a minute.  Shut up while I listen to your racist bull (EXPLETIVE DELETED).

It‘s one thing to say that they‘re hiring people who are unskilled, that they—that you can save money, that you can run it better, that it is inefficient and ineffective.  And I agree to all of those things but for you to bring in this bull (EXPLETIVE DELETED), oh a bunch of Nigerians, et cetera, that‘s out of the line.  

(END VIDEO CLIP)

SCHULTZ:  D‘Amato was the senator who filibustered legislation by reading from the D.C. phone book and singing “South of the Border Down Mexico Way” on the Senate floor.  If that guy is telling you you‘re nuts, you know you‘re guilty of psycho talk.  

Coming up, John Boehner is tanned and dangerous.  I‘m calling all progressives to join the fight against the tan man‘s push to become the speaker.  Katrina Vanden Heuvel, the editor of “The Nation” has a plan for us, next in the Battleground.

And why the heck would President Obama hammer the GOP for who they are?  The psycho-talking party of Rand Paul, Sharron Angle and the newster.  I‘ll get rapid-fire response.  

All of that plus, Beck preaches more garbage.  Christine O‘Donnell, I guess dates the devil and Sharron Angle orders up some psycho takeout.  You‘re watching THE ED SHOW on MSNBC.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW, the Battleground story tonight, the only thing that can save this country from Speaker Boehner and his destructive agenda is the progressive base.  If the base stays home, democrats are in trouble.  The Republican Party has always, really, has already been taken hostage by the most extreme elements of the Tea Party.  If progressives stay home, extreme candidates, like Christine O‘Donnell, Sharron Angle, they will be put in positions to make a big decision on a wrong vote.  Where they can push their radical agenda, like repealing health care reform, and shutting down the Department of Education.  The stakes are too high to stay home in November if you‘re a lefty.  But democrats in my opinion, aren‘t doing enough to make the case.  DNC Chairman Tim Kaine wants democrats to stop running away from the historic health care reform. 

(BEGIN VIDEO CLIP)

TIM KAINE, DNC CHAIRMAN:  Most democrats that I see on the trail are very proud of the accomplishment and they‘re talking about it.  It‘s now obviously, folks who voted against health care, their going to talk about why, but I think for the Democratic Party generally, this significant achievement for the  uninsured, for people who‘ve been abused by insurance company policies, for small businesses, for seniors, it‘s something that we should be very proud of and we should be talking about.  

(END VIDEO CLIP)

SCHULTZ:  And, yes, they should be proud.  They should be talking about it day in and day out and they should be reminding the American people every day that the alternative is House Speaker Boehner who wants to repeal it, get rid of it, end it, nada, over. 

Joining me now is Katrina Vanden Heuvel, editor of “The Nation.”  Katrina, good to you have with us tonight.  We brought this subject up last week about how the Democrats aren‘t saying enough good things about historic legislation that simply will save lives.  Now, they‘re starting to turn a little bit.  What do you make of it?  

KATRINA VANDEN HEUVEL, EDITOR “THE NATION”:  Well, Ed, you know, I know a lot of progressives who are disillusioned and who are thinking about sitting it out and I say to them, you can‘t sit it out.  Sit in.  You want to eat, pray and then vote because your apathy is going to hand the right wing running the Republican Party a victory and we‘re not looking just a choice election, Ed.  We‘re looking at a fundamental reordering of the priorities and possibilities of America because you have in the right wing today a party that wants to roll back the civilizing advances of the 21st century and the 20th century.  Talk about health care. 

You‘ve got 20 states run by conservative Republican attorneys general who are challenging the health care bill, want to overturn it.  The Republicans come back to Congress, they will try to overturn the signature, the flawed health care legislation.  So I think we need to wake up to the fact that we‘re looking at a real rollback, a real repeal, and we need to sit in and we need to take our anger and frustration and channel it, Ed, independent organizing.  Support for progressive candidates.  Go to the March on October 2nd, which is about a unified nation recommitting itself to jobs, to quality education, to equal justice, and push a White House to be tougher on rebuilding America, on peaking to those who are frustrated and alienated. 

I think—you know, I think that‘s part of what our future is about.  You don‘t make change in one election.  You don‘t make change with one president but you do stop change and you do rollback the possibilities of change if you let in the people who are talking the way they are on the campaign trail, buffeted supported, Ed, by disillusioned of corporate money that we haven‘t seen in decades unleashed by that activist Supreme Court with that citizens united decision.  

SCHULTZ:  Katrina, it‘s all about the jobs.  They‘re slowly coming.  All of the stimulus money hasn‘t been spent.  The small business package just got passed.  The bottom line is there‘s, what, 15, 17 million people in this country that are out of work?  There‘s a 99er crowd that‘s now putting together a no-vote coalition, meaning they‘re going to sit it out.  What should the Democratic leadership do to motivate these people?  I mean, when you‘ve lost your job, your house, your car, you‘re in debt, you know you kind of feel like the whole system‘s let you down.  It‘s hard to motivate these people but if you don‘t give them benefits in a strange economy that we‘ve had since the depression, they could turn on the democrats.  What do you say to them?

HEUVEL:  It‘s tough, Ed.  I mean, there is anger and pain at loose in this country.  I think a lot of people don‘t know how to think.  And there‘s a lot of work going on, neighbor to neighbor.  And I think the explaining, that it‘s going to take a lot of work but also that we have to demand more from those running this country to help those in pain, but what we do know is those who have pushed back unemployment insurance, those who seem to have content for the working people in this country through their votes aren‘t going to help those people but we need to fight harder and the House has put forward some good bills. 

Let us bring those to the attention of the American people and keep—keep up, but when Steny Hoyer talked about how the recovery, stock market, and how your pension plans would be better, the woman in the makeup room said to me, who‘s he talking about?  My retirement plan isn‘t going to be better because of this.  So I think there has to be some authentic, real talk, and not, you know, fluff talk.  

SCHULTZ:  Katrina, good to have you with us tonight.  

HEUVEL:  Thank you.  

SCHULTZ:  Thanks so much.  And yes the march is there on October 2nd

I know you‘ll be there with us.

Now let‘s get some rapid-fire response from our panel on these stories tonight.  

The White House is under daily assault by the Tea Party groups but they refuse to fight back in my opinion, they say a report that they‘re planning an anti Tea Party commercial for the midterms is absolutely false. 

Glenn Beck takes on the Obama family going to church on Sunday.  He says, it‘s proof his audience is winning. 

With us tonight, Joe Madison, XM radio satellite talk show host and also Scott Hennen, conservative activist.  Gentleman, good to have you with us.  Joe, I want your response first.  Is the White House making a strategic mistake by not connecting the GOP with the Tea Party and making it a campaign issue?

JOE MADISON, XM RADIO SATELLITE TALK SHOW HOST:  Oh, absolutely, and what they focused on apparently is public policy issue, but what everyone has been looking at, of course, is the Tea Party because it‘s dominating the news.  I think they have to make that connection.  And I would make the connection with the Republican Party the way that some made the connection with the Democrats and the Dixiecrats.  That‘s how I would make the connection because they‘re some of the same issues that Dixiecrats supported 40, 50, 60 years ago.  

SCHULTZ:  Here is President Obama today on the Tea Party Town Hall. 

Here‘s what he said.  

(BEGIN VIDEO CLIP)

BARACK OBAMA (D), UNITED STATES PRESIDENT:  The challenge, I think, for the Tea Party movement is to identify specifically what would you do?  It‘s not enough just to say, get control of spending.  I think it‘s important for you to say, you know I‘m willing to cut veteran‘s benefits or I‘m willing to cut Medicare or Social Security benefits or I‘m willing to see these taxes go up.  

(END VIDEO CLIP)

SCHULTZ:  These are realities, that‘s what they want, Scott.  That‘s what the Tea Party wants to do.  How do you combat that?

SCOTT HENNEN, CONSERVATIVE ACTIVIST:  Well, I think, first of all, I think, the GOP would be smart to continue to hitch their wagon to the Tea Party movement and in many cases they are the same.  They are.  And I think that nobody ought to apologize for that, because what the Tea Party moving is a renaissance of the grassroots in this country saying you know what, it is time to hear the constitution.  I mean, Barack Obama ought to show up to a few these Tea Parties, I‘ve been to a few.  All they talk about is, follow the constitution.  We are in the constitution for instances, Obama care with the tenth amendment.  

SCHULTZ:  Well, but when you‘re a senior and they‘re talking about cutting Social Security and you‘re a veteran and they‘re talking about cutting benefits in that regard, the constitution doesn‘t mean much to some of these folks that have paid their price to America.  

HENNEN:  No, I think—obviously, there needs to be some fiscal restraint and that‘s probably the number one bill that‘s being run at most of these Tea Partiers is people want to get spending under control.  To suggest, though, as he has, the president at this Town Hall meeting that oh, if you‘re in the Tea Party movement, then you want to slash and burn and cut is ridiculous. 

MADISON:  You see, I get really kind of tired of listening to people avoid the question.  There‘s a direct question.  Do you want to slash veterans‘ benefits?  I didn‘t get a yes or no.  Do you want to curtail or eliminate Social Security?  I‘m not finished.  There‘s not a yes or a no. 

HENNEN:  I‘ll happily give you an answer. 

MADISON:  The question is, the question is, is it always gets to the constitution.  I believe in the constitution.  We‘re talking about.

SCHULTZ:  The constitution answer on Scott is a rather generic.  

MADISON:  That‘s a generic answer.  

(CROSSTALK)

HENNEN:  Try it for quite some time because.

MADISON:  That‘s an excuse.  

HENNEN:  A lot to fix this country.  But I will say this, the answer to Joe‘s question, God bless you.  

MADISON:  No, it‘s his question.  Thank you.  

HENNEN:  Well, the question on the table is you know, that‘s old politics.  Oh, you‘re for cutting this, cutting that.  The answer is, no, they don‘t want to cut it.  

SCHULTZ:  So you‘re for cutting Social Security benefits.  

MADISON:  It‘s a yes or no answer.  

SCHULTZ:  Is a good thing?

HENNEN:  Reforming all entitlements.  We ought to put everything on the table.  

SCHULTZ:  But the Tea Party candidates, Scott.

HENNEN:  Have you ever seen Paul Ryan‘s plan?  Paul Ryan got a great plan.  

SCHULTZ:  The Tea Party candidates want to cut a lot of entitlements.  

HENNEN:  They want to reform the entitlements, Ed.  

(CROSSTALK)

SCHULTZ:  Reform, meaning cut.  It‘s a train wreck is the top two percent, here they are looking for another tax cut.  

HENNEN:  If we‘re talk, well, first of all, tax cut is what fuelled this economy, look at George Bush and the tax cuts. 

SCHULTZ:  He didn‘t add jobs.  

HENNEN:  Fifty two months of uninterrupted job growth.  Go check the facts on that one.  But let‘s go back to entitlements for a minute.  Look at the Paul Ryan plan, Paul Ryan says, you know what, if you are 55 and older, we‘re not touching your benefits.  Fifty five and younger, we are.  We‘ll phase that in.  That makes sense.  Now you guys are going to call that a cut.  I‘d call that good fiscal common sense.  

SCHULTZ:  If it‘s good fiscal common sense, is a good fiscal common sense to go into a war and not have a way to pay for it?  That‘s what got us into this mess and had we not gone into Iraq, we would not be in this fiscal mess, we probably would have had recession. 

HENNEN:  No, if Barack Obama hadn‘t been president, we won‘t be in this fiscal mess because it has gotten worse as he start his.

SCHULTZ:  Joe, give me your last word.  

MADISON:  Ridiculous, how‘s that?  That‘s all of the word I need. 

What he just said is ridiculous.  You, again, you didn‘t get any answer.  This war was not started by—the Iraq war was not started by Barack Obama.  It was started by the man who‘s no longer in office.  The comments are ridiculous. 

SCHULTZ:  Gentlemen, we‘ll do it again, Joe Madison, Scott Hennen, good to have you with us tonight. 

MADISON:  Up next, Tea Party wacko Christine O‘Donnell and FOX News think dabbling in witchcraft is all a big joke.  The more we learn about her, the more we should all be afraid of the conservative spells she‘s under.  

The broomstick comes out next in the Playbook.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  And it‘s not too late to let us know what you think.  Tonight‘s text survey question is, if the Republicans regain power, do you believe it will make your life better or worse?  Text A for better, text B for worse to 622639.  We got the results coming up.  Stay with us. 

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

CHRISTINE O‘DONNELL, DELAWARE SENATE NOMINEE:  I dabbled into witchcraft, I never joined a coven.  But I did, I did. 

UNIDENTIFIED MAN:  Wait a minute, you were a witch?

O‘DONNELL:  I dabbled into witchcraft.  I hung around people who were doing these things.  One of my first dates with a witch was on his satanic altar and I didn‘t know it and I mean, there is little blood there and stuff like that. 

UNIDENTIFIED MAN:  Your first date was on a satanic altar?

O‘DONNELL:  Yes, we watched a movie and then had a little midnight picnic on the satanic altar. 

(END VIDEO CLIP)

SCHULTZ:  Well, the more we find out about Christine O‘Donnell the weirder it gets.  The right wingers don‘t seem to be too concerned about her bewitching past even though they‘ve picked on President Obama for a heck of a lot less.  During the 2008 campaign, Sarah Palin went after President Obama for his association with Billy Heirs. 

(BEGIN VIDEO CLIP)

SARAH PALIN ®, FORMER VICE PRESIDENTIAL CANDIDATE:  Our opponent is someone who sees America as imperfect enough to pal around with terrorists who targeted their own country. 

(END VIDEO CLIP)

SCHULTZ:  So, Sarah, did O‘Donnell pal around with Satan worshipers?  How does that sit with the Christian right?  Did this double standard, you know, it isn‘t limited to just Palin.  Remember, the Obama‘s terrorist fist bump on “The New Yorker” cover?  And they‘re going to put O‘Donnell—are they going to put O‘Donnell on the cover dressed as a witch on a broomstick with a 666 written on her forehead?  Just asking the question. 

And folks, over on the right wing network have made careers out of baseless claims about President Obama, saying that—well, he went to a Madrassa, did you know that?  Asking if he would be sworn in on a Koran saying that Obama has a deep-seeded hatred of white people, all without a shred of evidence. 

Meanwhile, we actually have a tape, we actually have a tape of Christine O‘Donnell saying that she dabbled in witchcraft and FOX News is what?  They are silent.  If O‘Donnell was a democrat, they would have gone right out and found her Satan worshiping ex-boyfriend, don‘t you think? 

For more, let‘s bring in Eric Burns, president, Media Matters of America.  What do you make of this dandy?

ERIC BURNS, PRESIDENT, MEDIA MATTERS OF AMERICA:  Well, I tell you, Ed, it‘s something I‘ve never seen before in my career in politics.  A major U.S. Senate party candidate dabbling in witchcraft.  I don‘t quite know what dabbling means.  I don‘t know if I want to know.  

SCHULTZ:  How can FOX leave this one alone?

BURNS:  Well, I think they have to.  They‘ve created this Tea Party movement.  They‘ve created Christine O‘Donnell just as they did with Sharron Angle, just as they did with Rand Paul and you know they‘ve kind of created Frankenstein‘s monster because these folks have some very extremist views and I‘m not just talking about, you know, extreme right wing views, I‘m talking about views that in experiences that most Americans I think would really thing, it‘s kind of crazy to be honest with you.  

SCHULTZ:  Are liberals digging for more information?  Because it seems like every day, there‘s a new chapter on this candidate.  

BURNS:  I think, absolutely.  Of course, the record is very, very long on Christine O‘Donnell.  I mean when she was in the Middle East in 2004, she came back and said that she, you know, thought that the media censorship actually was a good thing.  It just goes on and on and on.  She thinks that women should be subservient to men in their relationships.  And so she‘s got a record that goes back to the late ‘90s and was actually a proponent of the conspiracy theories about Vince Foster.  

SCHULTZ:  What do you make of her canceling the Sunday shows?

BURNS:  Well, I think that a lot of these Tea Party candidates are not ready for prime time and there‘s fear that Chris Wallace might actually ask a tough question, which is one of the few places on FOX, where you know, he will from time to time not just let, you know, folks come on and raise money for their PACs and 527s but or their campaigns but will actually ask a tough question here and there. 

SCHULTZ:  Politically speaking, why do you think the democrats are hesitant to say, they‘re Republicans?  It‘s you know back in the ‘90s, it‘s the economy, stupid.  Now it‘s the Republicans, stupid.  I mean, Republicans are backing her.  

BURNS:  Oh absolutely Republicans are backing her.  And this is the real message that I think the people that are in the Tea Party that have good faith, really need to understand is that you know, the same folks that brought us the lives of George Bush and Tom Delay are the same folks that have engineered this Tea Party movement, paid for it, funded  it.  Put these candidates up who are not qualified and if these folks end up running the country, you know, this next year, this is what we‘re going to get.  

SCHULTZ:  Is she enough to motivate the Democratic base?  That really is the $64 question now.  

BURNS:  At least that. 

SCHULTZ:  All right.  Eric Burns, great to have you with us.  Thanks so much.

BURNS:  Thanks, Ed.

SCHULTZ:  Up next, Caribou Barbie is always warning about danger ahead.  Now I know what she‘s talking about.  She‘s truly testing the waters for 2012.  “Ring of Fire” host Mike Papantonio, he drives it home next on THE ED SHOW.  Stay with us. 

(COMMERCIAL BREAK)

SCHULTZ:  And finally tonight, no doubt about it, Sarah Palin has 2012 in her cross hairs.  She told FOX she‘s willing to make a presidential run if the country is up for it. 

(BEGIN VIDEO CLIP)

PALIN:  If the American people were to be ready for someone who is willing to shake it up and willing to get back to time-tested truths and help lead our country towards a more prosperous and safe future and if they happen to think that I was the one, if it were best for my family and for our country of course I would give it a shot but I‘m not saying that it‘s me.  I know that I can certainly make a difference without even having a title.  And I‘m having a good time doing exactly that right now.  

(END VIDEO CLIP)

SCHULTZ:  Joining me now is Mike Papantonio, host of the nationally syndicated show “Ring of Fire.”  She picks the Reagan Day dinner in Iowa to throw this out.  What do you make of it, Mike?

MIKE PAPANTONIO, HOST “RING OF FIRE”:  She‘s having fun, Ed.  We‘ve been palinized.  Look, the Republicans deserve Sarah Palin.  They deserve crazy Sarah.  But she‘s delusional.  Let me just remind you of something, when her own party attacked her, when her own party came out and said, why in the world would you be a VP on our ticket?  They said that she‘s not only a cheap opportunist, they said not only does she have minimal ability, they said she has no self-awareness of how unprepared she really is.  How incapable she is.  Sarah Palin has no self-awareness.  To this day, she‘s still a walking, talking political parity with no notion, at all, Ed about only 21 percent of the American public say that they have any favorable attitude about her at all. 

Her un-favorables, though, this is very interesting, her un-favorables in the last couple of months have risen, have risen six points during the time that she‘s used the Sarah Palin crazy card to launch other Looney  tunes.  Like the self-proclaimed witch, Christine O‘Donnell or Sharron Angle, who says—Sharron Angle who says that a woman who‘s raped really shouldn‘t have the right to have an abortion by law.  So, the GOP‘s out of control of their party.  I know you disagree with me on this a little bit, Ed.  And day to day, I change my mind about it, but I‘ve got it tell you this, I look at this today, the GOP has lost control of the party. 

You had that nut Jim DeMint stand up and bragged about the fact, Ed, bragged about the fact that they have cleansed their party of moderates.  And what is left at the bottom of the barrel is Sarah Palin.  And she is a real contender in the GOP mind, she‘s a perfect fit.  The best I think progressives could hope for is Sarah Palin  but I‘ve got tell you something, just like you say, every time, every hour that you‘re on the air, it‘s up to us to lose this and as progressives we will lose this no matter how crazy Sarah Palin and the rest of the leadership is.  We can lose this thing.  

SCHULTZ:  Mike Papantonio, always great to have your take in the program.  Thanks so much.  Thanks for joining us.

Tonight in our text survey, I asked you if Republicans regained power, do you believe it will make your life better or worse?  Fifteen percent of you said better, 85 percent of you said worse.  The one-nation march coming up on October 2nd, I‘ll be a featured speaker there, we‘ll have 300,000-plus.  I hope you could be a part of it. 

That‘s THE ED SHOW.  I‘m Ed Schultz.  Back on the radio tomorrow, Channel 167 XM from noon to 3:00.  “HARDBALL” with Chris Matthews starts right now on the place for politics, MSNBC.  We‘ll see you back tomorrow night. 

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

END   

Copyright 2010 CQ-Roll Call, Inc.  All materials herein are protected by

United States copyright law and may not be reproduced, distributed,

transmitted, displayed, published or broadcast without the prior written

permission of CQ-Roll Call. You may not alter or remove any trademark,

copyright or other notice from copies of the content.>

PASTE THE TRANSCRIPT HERE