updated 12/17/2010 2:04:54 PM ET 2010-12-17T19:04:54

Guests: Jerrold Nadler, Katrina vanden Heuvel, Tom Tancredo, Jesse Jackson,

Leo Gerard, Karen Hunter, Heidi Harris, Jeff Merkley, John Nichols

ED SCHULTZ, MSNBC ANCHOR:  Good evening, Americans, and welcome to THE ED SHOW tonight from New York.

These stories are hitting “My Hot Buttons” at this hour and on the table. 

Well, here we go.  President Obama is one step closer to owning his big tax compromise with the Republicans.  The only person who can get in the way now is Nancy Pelosi. 

Congressman Jerry Nadler called the deal a “gangster giveaway.”  I‘ll talk to him and Katrina vanden Heuvel of “The Nation” coming up. 

Well, Harry Reid threw a knockout punch today at some Republicans who were whining about having to work around the holidays.  This is why Reid won in the state of Nevada.  I mean, when it gets tough, he knows how to fight. 

Wait until you see the tape.  You‘re going to love it. 

And the Tea Party indoctrination, well, that is now in session.  Michele Bachmann‘s the teacher, and she‘s got a class full of extremist clowns to help educate the new members of Congress. 

And this just in.  Moments ago, “Don‘t Ask, Don‘t Tell” passed the House.  You won‘t believe what some Republicans on the floor were saying about gay Americans.  That‘s coming up. 

But this is the story that has me fired up tonight. 

President Obama is one step closer to having his $858 billion tax compromise with the Republicans become the law of the land, and right now Nancy Pelosi is the only person in the world that can stop it. 

Now, earlier today, the Senate voted overwhelmingly to pass this package by a vote of 81-19.  Remember that number, 81.  Only 13 Democrats, five Republicans and Bernie Sanders voted no. 

Now, the Senate support for these tax cuts I think is pretty staggering. 

Let me show you this. 

Compare it to this.  In 2001, the Bush tax cuts passed the Senate by a vote of 58-33.  And in 2003, the second round of these tax cuts passed 51-50.  That of course is when Dick Cheney broke the tie. 

It‘s kind of funny, isn‘t it?  I mean, this means that President Obama did a better job of selling the Bush tax cuts than President Bush ever did? 

Well, now the president has to sell the compromise in the House, but he‘s convinced today‘s vote is a win for the middle class. 

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  I know that are there different aspects of this plan to which members of Congress on both sides of the aisle object.  That‘s the nature of compromise.  But we worked hard to negotiate an agreement that‘s a win for middle class families and a win for our economy, and we can‘t afford to let it fall victim to either delay or defeat.  So I urge members of Congress to pass these tax cuts as swiftly as possible. 

(END VIDEO CLIP)

SCHULTZ:  All right.  The House will vote on the Senate version of the package as early as tomorrow. 

Senate Minority Leader Mitch McConnell is warning the House, you better not tinker with this bill. 

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL ®, MINORITY LEADER:  This agreement is not subject to being reopened.  In other words, we have an understanding, and I hope that our friends in the House will understand that that‘s the best way to go forward.  Simply pass the Senate bill, get it down to a president who supports the understanding. 

(END VIDEO CLIP)

SCHULTZ:  An understanding?  Well, it‘s a take-it-or-leave-it mentality that the Senate has with this bill.  It has a lot of folks over on the House angrier than ever. 

House Democrats want to change the inheritance take giveaway the Republicans got in this bill.  But according to McConnell—you just heard him—no way. 

Now, by law, the estate tax would go back to a million dollars, tax free, and the balance taxed at 55 percent.  Now, the Republican compromise, well, it takes it up to $5 million, and the rest of the rate would go to 35 percent. 

Well, today‘s lopsided Senate vote and new polling is really putting enormous pressure on Nancy Pelosi and House members to get this bill through the House.  Now, the new NBC/”Wall Street Journal” poll shows that 59 percent of Americans support the deal and only 36 percent disapprove. 

So what‘s it mean?  Well, I guess you have to hand it to the president. 

President Obama, he‘s done an outstanding job of selling this compromise to the Senate and to the American people.  I just hope this $900 billion gamble works. 

I‘m a 36-percenter tonight, folks.  I will never trust the Republicans when it comes to tax cuts.  I know where we‘re going to be from a year from now and two years from now, but President Obama seems to have bought this talking point hook, line and sinker. 

(BEGIN VIDEO CLIP)

OBAMA:  I‘m absolutely convinced that this tax cut plan, while not perfect, will help grow our economy and create jobs in the private sector. 

(END VIDEO CLIP)

SCHULTZ:  Oh, I hope so. 

Last week, House Democrats rejected this bill in its current form, and last night the Democrats caucused again in the House and they started to question the two percent drop in the Social Security tax rate.  So the bottom line here is the Senate package is designed to stick it to the House Democrats. 

Congressman Alan Grayson put it this way --  

(BEGIN VIDEO CLIP)

REP. ALAN GRAYSON ®, FLORIDA:  Frankly, we are getting the bum rush. 

That‘s what this is. 

This is a bill that spends a trillion dollars.  That‘s $3,000 for every man, woman and child in this country. 

A couple of weeks ago I bought a big-screen TV for $1,500.   It‘s my first one in about five years, and I spent more than two hours trying to figure out which was the best big screen TV to buy, because $1,500 is a significant expenditure. 

Here we‘re talking about a trillion dollars, $3,000 for every single one of us.  And it‘s being forced through without a hearing, without a markup, without even a study of its economic effects.  This is the bum rush, and I‘m not happy about it. 

(END VIDEO CLIP)

SCHULTZ:  So, folks, that documents everything that has happened up to this point.  I mean, the basics, OK? 

So if you don‘t grasp anything else about what is going on with this whole thing, just grab the next couple minutes here. 

Between the tax cuts and the spending bill, Congress is about to dump $2 trillion on your kid‘s credit card without so much as a hearing, no markup, no CBO score, no economic forecast.  It is take it or leave it. 

Well, actually, it‘s a government takeover. 

Now let‘s go back to the health care debate.  How long did that last, 15 months?  How many committees did it have to go through?  Five.  A reconciliation vote as well. 

I mean, they had hearings, they had votes.  Oh, don‘t you remember when the righties were so uptight about the next provision of the health care bill?  Well, we have to wait for the CBO score.  But, you see, we don‘t have any of that this time, and this is a hell of a lot bigger and it‘s going to cost a hell of a lot more money than the health care bill.

But, you see, there‘s a difference.  The righties are getting exactly what they want. 

They‘re getting the top two percent tax cuts and they are getting the time frame that they want, and they‘re getting the estate tax giveaway.  I mean, this is red meat to the righties. 

This, my friends, is not the Democratic process.  We have had on this program numerous elected officials in both the House and the Senate come to you and speak on THE ED SHOW and say this is not how it‘s supposed to work in Washington. 

But because we‘ve got a Christmas holiday coming up, and because we‘ve got this deadline, and because we can‘t really hold to our convictions from the campaign trail, we now have a gun to our head.  And I‘m speaking from a liberal perspective. 

We have to give the righties exactly what they want because they tell us that we‘re going to create jobs if we do what Bush did.  I mean, I don‘t know how in the hell this got 81 votes. 

What is it about—is it the pollution in Washington?  Is it the special potion or the Kool-Aid they drink?  What in the heck is it? 

Folks, this is your government takeover right here, a very few number of people not going through the legislative process, not going through the due diligence, not doing the scoring to tell you exactly where this is all going to turn out.  Trust.  You know, it‘s that old trust, but verify. 

You could trust but you can‘t verify.  That is the intangible that we‘re playing with when we talk about kids and grandkids and their future, and we‘re so concerned about them. 

I‘ll say it as I did it last night.  I‘ll say it again, I don‘t want to hear any Democrats go out on the campaign trail and tell the American people that you‘re really concerned about the deficit, that you‘re really concerned about the next generation. 

Oh, I know we‘ve got this deficit reduction commission.  You know what that is?  That‘s the kill Social Security crowd, that‘s the kill the Medicare crowd, that‘s the kill Medicaid, that‘s the kill every entitlement program that is out there that Americans have already paid for. 

This is example A of what a real government takeover is all about.  I swear to God, I never thought I‘d ever see it in my lifetime, Washington act like this.  But, you know, it‘s only $2 trillion. 

This is not the way our democracy is supposed to work.  This is not fair, and we are being held hostage.  And I don‘t even know if “hostage” is a strong enough word. 

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

Tonight‘s text survey question is: Do you believe President Obama‘s tax compromise with Republicans will create jobs?  Text “A” for yes, text “B” for no to 622639.  We‘ll bring you the results later on in the show. 

Joining me now is New York Congressman Jerry Nadler. 

Congressman, good to have you with us tonight. 

REP. JERROLD NADLER (D), NEW YORK:  Good to be here. 

SCHULTZ:  Is this it?  Is this going to pass the House? 

NADLER:  I think a bill will pass the House tomorrow that will be substantially the same as the Senate bill with one change.  We‘re going—apparently, we‘re going to change the estate tax so it won‘t be the Senate version.  It‘ll be last year‘s estate tax.  It‘ll be a $3.5 million exemption for a single person and $7 million for a couple instead of one and two. 

SCHULTZ:  All right.  The keyword here is “change,” Congressman.  You just heard Mitch McConnell.  They have an understanding.  What‘s your understanding of the understanding? 

NADLER:  Well, they may have an understanding with the president, but they don‘t have an understanding with the House.  And for them to say we must take it or leave it is outrageous. 

We are an independent elected body.  Now, I‘m not going to vote for this bill in any event, but there‘s so much in it for the Republicans, that they should take this.  And they may yet.  We‘ll see. 

SCHULTZ:  Well, you have said it‘s like dealing with gangsters.  Do you stick to that comment? 

NADLER:  I sure do.  I mean, what I said was they‘re acting like gangsters because they‘re saying, in effect, to us and to the country, you have this very nice middle class tax cut here.  A pity if anything should happen to it.  And if you don‘t extend the tax cuts for millionaires and billionaires, we‘ll kill the middle class tax cut.  That‘s blackmail, that‘s extortion. 

SCHULTZ:  Is Nancy Pelosi going to go along with the change in the estate tax and create what could be a huge problem at this point? 

NADLER:  Well, from what I‘m hearing, the bill that will be on the floor tomorrow will change the estate tax from what‘s in the Senate bill. 

SCHULTZ:  Well, this is going to be interesting. 

Congressman, good to have you with us tonight.  Thanks so much. 

NADLER:  Good to be here.

SCHULTZ:  Katrina vanden Heuvel, editor of “The Nation” magazine, with us tonight. 

Katrina, what do you make of this in the 11th hour?   

KATRINA VANDEN HEUVEL, EDITOR, “THE NATION”:  Well, I think we need to step back and look at our system, as you were doing, Ed, and remember, never forget that the Republicans held working class, middle class people hostage.  Then you have to also reflect on how President Obama telegraphed his end game before having fights. 

And fights can be constructive.  They can define who you are, what you are, what your party is. 

I think we also need to celebrate those in the Senate, Senator Bernie Sanders, who speak for the middle working class.  We‘ve got to do, I think, some changes in this House bill. 

I met with some estate trust tax lawyers this morning in New York City, big law firms.  They can‘t believe that the estate tax is so beneficial to the wealthiest in this country.  They‘re wondering what went on in these backroom dealings.

So I think that we‘ve got to—in the end of the day, you‘ve got reflect on how it is that you had majority opinion against tax cuts for the richest, our president didn‘t mobilize that support effectively, and the Republican Party is holding this country hostage.  And we‘ve got to break that moving forward, because we‘re going to have these debates again in 2011, 2012.

SCHULTZ:  Katrina, what do you think the liberal message is to Nancy Pelosi at this point? 

VANDEN HEUVEL:  Stand strong and lay down some lines on this estate tax.  But I think—it‘s a terrible thing, but we‘ve got a system, Ed, of transactional politics when we need transformational politics. 

And it may be that, you know, Jerry Nadler, good congressman, you don‘t want to hold working and middle class people hostage.  But we‘ve got to go forward and we‘ve got to expose how the Republicans and conservative Democrats are really giving millionaires and billionaires a bailout. 

SCHULTZ:  And do you trust President Obama?  I mean, after we‘ve gone through all of this, has he really played a bad card for liberals to the point where you can‘t trust him anymore? 

What do you think?

VANDEN HEUVEL:  You know what?  I don‘t think anyone should trust politicians or fall in love with politicians.  It‘s about accountability politics, and it‘s up to progressives moving forward to create the conditions, organize, mobilize, drive ideas into the debate. 

I think we need a whole new tax debate in this country about a new tax system that is fairer, simpler, and rewards work.  And the president could come forward in the State of the Union, and we progressives should push him do that, lay it out, and fight for that. 

We need different debates in this country.  We are not being served as citizens as a democracy with the debates, hostage-taking, extortion that we are living with. 

SCHULTZ:  Yes.

Katrina vanden Heuvel, great to have you with us tonight. 

VANDEN HEUVEL:  Thank you.

SCHULTZ:  Thanks for speaking up again. 

Coming up, “Slant Head” Hannity is about to become a constitutional professor?  Only someone in a trance like this could be really in a psycho deal, right?  I‘ll explain ahead.  I‘ll have to. 

“The Beckster” is completely delusional.  He‘s gift-wrapping some fear just in time for the holidays, and I‘ll light him up in “The Zone.” 

Plus, I‘ve got a leaked e-mail from Fox News, and it proves once again how sleazy they are. 

And Eric Holder just served up BP a massive lawsuit. 

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

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW, and thanks for watching tonight. 

The Republicans, I guess you could say, they‘ve been naughty all year long, doing everything they can to stall and slow-log (ph) bills in the Senate.  Now, well, they‘re having a meltdown. 

They‘re melting down because Harry Reid says their delayed tactics might mean that they might have to skip Christmas vacations and come back to work. 

Senator Jim DeMint kicked off the whing in Politico, saying, “What‘s going on here is just wrong.  This is the most sacred holiday for Christians.” 

Well, I think you could debate that.  It could be Easter. 

Republican leaders followed suit, taking their war on Christmas vacation on to the Senate floor. 

(BEGIN VIDEO CLIP)

MCCONNELL:  It is completely and totally inappropriate to wrap all of this up into a 2,000-page bill and try to pass it the week before Christmas. 

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

SEN. JON KYL ®, ARIZONA:  It is impossible to do all of the things that the majority leader laid out without doing—frankly, without disrespecting the institution and without disrespecting one of the two holiest holidays for Christians and the families of all of the Senate.  Not just the senators themselves, but all of the staff. 

(END VIDEO CLIP)

SCHULTZ:  You know, it‘s just always about them, isn‘t it?  It‘s always about their process, their Washington minutia. 

You know, give me a break.  What do you mean disrespect?  Disrespect is not caring about the 99ers, not giving a damn about the unemployed. 

Well, Harry Reid, the former boxer from Nevada, he got after it and delivered the knockout punch.  Check it out. 

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER:  As a Christian, no one has to remind me of the importance of Christmas for all the Christian faith, all their families all across America.  I don‘t think any of us—I don‘t need to hear the sanctimonious lectures of Senator Kyl and DeMint to remind me of what Christmas means. 

My question, Madam President, is where were there concerns about Christmases after filibuster after filibuster on major pieces of legislation during this entire Congress?  Perhaps Senators Kyl and DeMint have been in Washington too long, because in my state, Nevadans employed in casinos and hotels and throughout the state of Nevada, and on ranches, basically every place, have to work harder on holidays, including Christmas, to support their families.

The mines don‘t shut down in Nevada on Christmas.  People work.  They get paid double-time a lot of times when they have good contracts, but they work on Christmas holidays. 

Most people don‘t get two weeks off on any time, let alone Christmas week.  And these people who are lucky enough to have a job in these trying times need to work extra hours just to make ends meet. 

So it‘s offensive to me and millions of working Americans across this country for any senator to suggest that working through the Christmas holidays is somehow sacrilegious or disrespectful. 

(END VIDEO CLIP)

SCHULTZ:  Harry Reid nailed it. 

Folks, this is why Harry Reid won re-election.  I mean, he‘s just not going to back down.  And having to work after Christmas may be a shock to the Washington establishment, but I don‘t think any Americans are going to be crying for them this year. 

Joining me now is former congressman Tom Tancredo. 

Tom, good to have you with us tonight. 

TOM TANCREDO ®, FMR. CONGRESSMAN:  Thanks. 

SCHULTZ:  Who‘s right and who‘s wrong in this?  Should it be the Senate schedule or should it be the work of the people? 

TANCREDO:  I think—I‘d tell Harry, methinks thou doth protest too much. 

Way too much being made over these kinds of statements.

They‘re hyperbolic.  You know, ‘tis the season to be jolly, and in Washington, it‘s always the season to be hyperbolic.  Both sides do it.  Both sides employ it to pull this little, you know, dust-up over the Christmas holiday thing. 

SCHULTZ:  Who started it, Tom?  Tom, who started it? 

You‘ve got the START treaty out there.  You‘ve got “Don‘t Ask, Don‘t Tell.” 

You‘ve got finances. 

And here are the Republicans—when you‘ve got 15 million people out of work, here are the Republicans crying about, they might have to work over Christmas.  Now, just how does that play? 

TANCREDO:  And here‘s a 2,000-page bill that nobody has read, that no one has the slightest idea what‘s really in it, except the total figure and a lot of earmarks, and it‘s coming up at a time when, of course, there should be a heck of a lot more discussion.  And Harry Reid brings it up at a time like this, when he knows that all of this gets compressed at the end, hoping that he can get it through because of that time crunch. 

It‘s all a game.  It‘s all a game, Ed. 

SCHULTZ:  It is a game. 

TANCREDO:  Both sides play it. 

SCHULTZ:  It is a game. 

TANCREDO:  It‘s not unique. 

SCHULTZ:  And that‘s the whole point.  Where‘s the march by the Tea Partiers?  Where‘s the outcry by these people who wanted something different in Washington?  They seem to be silent. 

Why isn‘t Fox News going—here‘s a look at the Mall right there.  Where‘s the march?  I mean, this is the same old crap that we see in Washington, and you know it. 

TANCREDO:  Well, it‘s because it‘s the same old Congress.  Remember, the new Congress hasn‘t started yet. 

SCHULTZ:  Oh. 

TANCREDO:  Most of the people that the Tea Party supported are not there, Ed.  This is the same bunch of people—a lot of them, of course, are people saying, hey, I got booted out and I‘m going to teach my constituents a lesson. 

SCHULTZ:  But it‘s about the money.  It‘s about no earmark—or it‘s about no hearings, no markups, no CBO score. 

TANCREDO:  Crazy.  Crazy. 

SCHULTZ:  It‘s the same old garbage.  And where are the Republicans?  They stand there worried about having to working over the holidays. 

Tom, good to have you with us tonight.  Appreciate your time. 

TANCREDO:  Likewise, buddy. 

SCHULTZ:  Coming up, “The Beckster” is gift-wrapping some paranoia for the holidays, and of course we‘re going to light him up in “The Zone.”

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  And in “Psycho Talk” tonight, “The Beckster” is putting his own spin on the holiday season.  He started off his show last night preaching about the true meaning of Christmas, which apparently is a knock off the Oprah show. 

(BEGIN VIDEO CLIP)

GLENN BECK, FOX NEWS:  I want to talk to you about the meaning of Christmas, but let me—I also want to talk about some of my favorite things. 

Oprah, we can outdo you.  See, you‘re supposed to cry and stuff.  You‘re on my favorite things episode!  Wow, this audience sucks. 

(END VIDEO CLIP)

SCHULTZ:  Well, his audience wasn‘t the only thing that sucked.  On Oprah‘s “Favorite Things” show, her audience got a car.  But “The Beckster” is giving away paranoia for the holidays. 

Listen to his top gift pick. 

(BEGIN VIDEO CLIP)

BECK:  We decided to get our family food storage this year.  But it is probably the best gift that you can give anybody this year. 

You know, if you‘re a grandparent, give your kids and grandkids food storage.  Give them things that with inflation coming, things that they‘re going to need and they don‘t—the family wouldn‘t have to worry about. 

(END VIDEO CLIP)

(LAUGHTER)

SCHULTZ:  What you are doing, Beckster, preparing us for more unemployment?  Sure, because food storage is what every kid wants from their grandparents for Christmas, right? 

But he didn‘t stop there.  He had a whole rambling show full of things, full of favorite things. 

(BEGIN VIDEO CLIP)

BECK:  Survival bags, urban survival playing cards.  Bartering and negotiating in post-disaster survival situations. 

The “Narnia” series.  “The Real George Washington.”  The best toffee ever, ever made. 

Which camera are we up to?  It‘s the 828 (ph) book, and it was a scrapbook that I made for my children. 

Chalk!  Yes, I can. 

And the best rice pudding I think that is available. 

The Christmas survival bag.  Ho, ho, ho, everybody.  We‘re all going to die. 

(END VIDEO CLIP)

SCHULTZ:  Yes, Merry Christmas, everybody. 

But wait a minute, Beckster.  You forgot the flashlight. 

Have you seen those flashlights that are out there that you can wind up?  They don‘t even need any batteries.  You just wind them up and you turn them on.  It‘s kind of like so you can be the deer in the headlights. 

This guy is the Wal-Mart of giveaways, and his Tea Party and fear-mongering rip-off of Oprah‘s “Favorite Things” is nothing but paranoid “Psycho Talk.”

Coming up, President Obama went behind closed doors with the most powerful business leaders today, and I hope they got after it.  They‘re sitting on piles of cash. 

Leo Gerard, one of the top labor leaders in America, and Reverend Jesse Jackson will be here to sound off for the American worker. 

And I‘ve got an internal e-mail from FOX News proving just how they are out to defeat the president of the United States and the democratic agenda.  Wait until you see the evidence.  Plus, the Obama administration drops the hammer on BP.  It‘s a big lawsuit.  And an extremist republican congressman says, the repeal of “Don‘t Ask, Don‘t Tell” will lead to the fall of America.

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

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  The “Battleground” story tonight, you know, I think that Wall Street is mugging this president, beating up on him and still walking off with all the taxpayer‘s money.  Now, we just finished an election where the Chamber of Commerce spent more than $30 million to spread the falsehood that the Democrats and this president have just been terrible for business.  Nothing could be further from the truth.  In fact the numbers show it.  Wall Street got record bonuses in the first year of Obama‘s presidency.  How‘s that going to play out for the historians?  Reuters reported today that Wall Street bonuses this year may top that from last year. 

And “The New York Times” reported the S&P 500 which basically measures the health of the biggest companies is up seven percent.  Are you getting a seven percent raise this year?  Folks, this is absolutely, there is no reason why this president has to defend his record on business.  He is pro-business.  On top of that, he‘s about to give the super rich another round of tax cuts.  But the president is still trying to make nice with Wall Street, he invited 20 CEOs over today for lunch for a working conversation on how to jump-start hiring in this country.  Here‘s what he had to say going into the meeting. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED WOMAN:  Are you looking for a commitment from the executives today to spend some of the capital that they‘re sitting on toward job creation?

PRES. BARACK OBAMA (D), UNITED STATES:  I am looking forward to getting good ideas from them but I am definitely going to talk to them about how we can get more hiring out there.  

(END VIDEO CLIP)

SCHULTZ:  Now, I don‘t know what there is to talk about, nine financial companies are sitting on nearly $2 trillion.  The most in some 40 years when it comes to resources.  Now, I would tell the CEOs to quit hoarding their cash and do something for the country.  You know that economic patriotism?  The president has been great for business.  He‘s been great for small business and it‘s time for business to do something in return for America, like start hiring, start doing different things like expanding payroll, getting more people on the job,  loosening up the credit. 

Leo Gerard, president of the United Steelworkers with us tonight. 

Mr. Gerard, good to have you with us. 

LEO GERARD, PRESIDENT, UNITED STEELWORKERS:  Good to be with you.  

SCHULTZ:  It‘s been somewhat of a capital strike, has it not?

GERARD:  I think so that we see that these companies have made record profits throughout the last 12 months and they‘re not spending it.  And the reality is that we‘ve got to get some demand in there, and the best way to get demand in it is for them to bring people back to work, and put those people back to work so those people can be consuming the kinds of things they need to get the economy going again.  And simply sitting on cash or even worse making investments in China or Korea or somewhere else rather than making them here is not going to help people get back to work and if we don‘t put people back to work, we can‘t get out of the mess we‘re in.  

SCHULTZ:  So, some the reports coming out of the meeting, it sounds like President Obama was really asking them to step up.  He‘s done a lot for them.  He has set the table for them.  He‘s given them basically everything they‘ve wanted.  And of course they‘re going to hit him on the corporate tax rate, they want to see that lowered.  What should the president do about them sitting on these resources?

GERARD:  Look, I think what we‘ve got to do is start to put some pressure on to put together an  industrial plan for getting people back to work.  We‘ve got to start talking to them about if they‘re not going to spend it, we ought to tax it.  The fact of the matter is that sitting on that money is not helping to put people back to work, it‘s not putting demand back in the economy, and they‘ll come crying.  They always come crying that oh, my God, our tax rates too high.  Let me give you a real point, one of the largest companies in the world, Exxon, who made tens of billions of dollars in the last few years paid zero, I mean zero in income tax, plus they got a tax rebate from the government.  Something‘s wrong with that system. 

And we need to close those tax loopholes.  We‘ve got to fight about this.  I‘m prepared to go out and walk in the streets if that‘s what it takes.  We‘ve got to get the unemployed back to work, when they get back to work, they‘ll pay taxes back into the system, they‘ll consume, and we‘ll get our way out of this mess.  We‘re not going to get out of the mess by continuing to give tax cuts to the ultra rich and then hoping and praying that they do something nice for us. 

SCHULTZ:  Mr. Gerard, is it too far to speculate that maybe there are a lot of CEOs in that room that don‘t want President Obama to be the president of the United States?  And they‘re just going to sit him out and they‘re not going to invest.  Their companies are doing fine in the environment that they‘re in right now, what about that?

GERARD:  Look, Ed, I think that that could be a possibility but I‘d hate to believe that.  I don‘t want to believe that.  The fact of the matter is that we‘ve got to call upon their economic patriotism and we‘ve got to have a stick in a carrot.  This president has stood put up for business, this president had given more tax cuts to the medium-size business ever.  He‘s gone out and he‘s done the kinds of things to try and stimulate the economy with the economic renewal legislation he‘s brought in.  He‘s been stymied by Republicans every step of the way and it‘s time that we say enough is enough.  And I think we need to take to the streets if that‘s what it takes to show these people that we‘re fed up of this stuff and you can‘t get the economy back off its butt, Ed, unless you get some of those 30 million, and I say 30 million, because there‘s 15 million unemployed officially, there‘s another 15 million that are either underemployed or have just given up, can‘t find jobs.  

SCHULTZ:  Mr. Gerard, always a pleasure.  Good to have you with us tonight.  Thanks so much. 

GERARD:  Thank you.  Thank you.

SCHULTZ:  Now let‘s turn to the Reverend Jesse Jackson, president of the Rainbow PUSH Coalition.  Well, hopefully the workers of America and those who have fallen on hard times will have a seat at the table.  Reverend, what should they do?

REV. JESSE JACKSON, PRESIDENT, RAINBOW PUSH COALITION:  Well, I think it‘s important that the president did meet with business today but not to be a White House conference on poverty, disparity and on economic justice.  He‘s been very good to business, they‘ve not been so good back to him.  For example, he bailed out the banks with zero interest but they did not lend and reinvest, therefore you have a rise in joblessness and the rise in the home foreclosures.  Just this past week, Bank of America now said it will revive its home foreclosures for example.  He bailed out GM, and then one market of a Buick now is China, and so there must be some real incentives to reinvest in America.  I see a tax bill today which you really have is you have a tax cuts for the very rich in December.  There will be spending cuts come April and who will be cut? They‘ll be looking at Social Security and Medicare and Medicaid.  

(CROSSTALK)

SCHULTZ:  That‘s the target.  You know, Reverend, that is the target, you agree.  You agree, I mean they‘re going after the entitlements what the American people have already paid for and it looks like President Obama and the Democrats are walking us right down that path.  How much do you believe in your heart that in a year from now that we‘re going to get that two percent back on Social Security and what about the tax cuts not being an issue two years from now.  

JACKSON:  Well, it just strange me that two million people working people, about eight million people will have been spending money when they‘re get their checks.  But the very rich are not going to spend more because they can‘t spend the surplus that they have now.  They‘ve globalized capital without globalizing workers rights and they will not globalize workers rights and women‘s rights voluntarily unless they have some industrial strength put behind the demands that they‘ll not reinvest in America and put America back to work.  They‘ve enjoyed the party but they‘re not paying for the party.  

SCHULTZ:  Reverend Jackson, good to have you on tonight.  Thanks so much.

Now let‘s get some rapid-fire response from our panel on these stories.  More foxy leaks.  New e-mails show how FOX News deliberately works to push conservative talking points on climate change. 

And the House‘s historic vote to repeal “Don‘t Ask, Don‘t Tell” is marred by some ugly republican talk about gay Americans.  I think they‘re on the wrong side of history on this issue and so do the American people, the majority of Americans. 

With us tonight, Karen Hunter, journalist and publisher and also Heidi Harris, radio talk show host out of Las Vegas.  Karen, it‘s up to the Senate now to do something on “Don‘t Ask, Don‘t Tell,” how is this going to play out? 

KAREN HUNTER, JOURNALIST:  I‘m praying that it place out sensibly.  I‘m praying that, you know, the people in the Senate realize that, you know, our army is thin.  We need everyone that, you know, anyone who is coming to the table who wants to fight for this country should have the right to fight for this country.  Ed, you remember a time when blacks couldn‘t fight in the army.  You remember a time in this country when people were judged based on the color of their skin and now, I mean, what are they afraid of?  I‘m so baffled by this that it‘s even coming to this and all of the ugliness that‘s coming out of it.  And it‘s so strange, it‘s so weird, it‘s so un-American.  

SCHULTZ:  Listen to what a Texas congressman said about this on the floor today during the debate. 

(BEGIN VIDEO CLIP)

REP. LOUIE GOHMERT ®, TEXAS:  To my friend who said, history will judge us poorly, I would submit, if you will look thoroughly at history and I‘m not saying it‘s cause and effect but when militaries throughout history of the greatest nations in the world have adopted the policy that fine for homosexuality to be overt, you can keep it private and control your hormones fine, if you can‘t, that‘s fine too, they‘re toward the end of their existence as a great nation.  

(END VIDEO CLIP)

SCHULTZ:  Heidi, are we towards the end of our existence as a great nation if we allow gays to serve in the military.  

HEIDI HARRIS, RADIO TALK SHOW HOST:  What?  I don‘t think it does us any good.  I really don‘t and would like the one person to tell me how allowing gay people to serve openly, they already served but openly is going to strengthen our military.  There are a lot of people who have already said, they‘re going to leave the military.  I hope there are tons of openly gay people who want to fill the ranks if a lot other people don‘t want to be part of the military anymore.  There‘s no argument that says it‘s going to make our military better.  It‘s a social experiment because that‘s what the left wants and there‘s no benefit to the military whatsoever.  

HUNTER:  Heidi, so you condone people not being who they are and so they should be, you know, pretend like they‘re something like they‘re not, I mean, I don‘t quite get your argument.

HARRIS:  Yes.  That‘s exactly right, Karen, because when you join the military, they shave your head.  You all dress the same, you all sleep in the same place, march the same.  

(CROSSTALK)

HUNTER:  That‘s fine.  But you don‘t stop being black, you don‘t stop being Hispanic, you don‘t stop being a woman, you don‘t stop being Asian, and a gay, that‘s part of who are.  That‘s part of your makeup, you can‘t stop being that either.  

HARRIS:  Oh, nobody cares if you‘re gay, all they care about is you march the same way, do you behave the same, can you fire a gun the same way?  

HUNTER:  And who say that they‘re not going to do that?  What are they afraid of, are they going to have sex on the front lines?  

(CROSSTALK)

I mean, what‘s really the argument here?

HARRIS:  No, no.  They do that now but you‘re talking about them being openly gay, what does that mean they‘re going to walk differently?

HUNTER:  Exactly?  What does that mean, Heidi? 

HARRIS:  They‘re going to talk differently? 

HUNTER:  And I don‘t think it means anything to be honest with you.  

HARRIS:  Then they shouldn‘t worry about it.  

HUNTER:  Exactly, so they should pass the law and let people be who they are.  

HARRIS:  Be all that you can be, is that what it is?  Be gay if you want to be.

HUNTER:  No, be who you are.  And serve this country.  Are you going to go on the front lines?  I don‘t think so.  

HARRIS:  Go work in the coffee shop if you want to be an individual.  The military, unit cohesion, individuality‘s out the door when you join the military.  

HUNTER:  And I couldn‘t agree with you more but that doesn‘t mean that you stop being who you are, Heidi. 

HARRIS:  Well, be who you are, that‘s all.

SCHULTZ:  All right.  It moves to the Senate.  Ladies, thanks for joining us tonight.  Karen Hunter and Heidi Harris on this issue.  

HUNTER:  Thank you.

HARRIS:  Thanks.

SCHULTZ:  Coming up, the righties in the Senate have used the filibuster to stall and delay.  Democratic Senator Jeff Merkley is on a crusade to fix filibuster rules but I‘ve say folks, we‘ve got to be a little bit careful here.  We might not want to wish for something we may have to deal with later.  That‘s next.  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, do you believe President Obama‘s tax compromise with Republicans will create jobs?  Text A for yes, text B for no 622-639.  Results coming up.  Stay with us.                        

(COMMERCIAL BREAK)

SCHULTZ:  And in my “Playbook” tonight, after two years of Republicans abusing the filibuster rule, some Senate Democrats have had enough and are mounting a major effort to weaken the filibuster.  Today Senator Tom Harkin of Iowa said that he will fight for reform as soon as the new Congress convenes in January and he predicted fireworks.  Now, I understand the impulse to gut the filibuster since Republicans have abused it to stop President Obama‘s agenda, and it may surprise some folks, but I think it‘s a mistake to weaken the filibuster.  Here‘s why, it might be good for Democrats for the next two years but what happens in 2012 with all of those corporate money flying around?

Democrats will be defending 21 Senate seats.  Republicans only have ten to defend and the citizens of the United States Supreme Court ruling means Republicans will be able to pour money into the election cycle and purchase a bunch of Senate seats.  That‘s how it works.  I mean money works, doesn‘t it?  If the Republicans get control of the Congress and then the only tool the Democrats will have to stop their radical agenda is the filibuster.  So, in my opinion weakening it, it is dangerous.  It‘s better be the right call. 

Senator Jeff Merkley of Oregon is in favor of the filibuster reform and he joins us tonight.  Senator, this filibuster has been around since 1857, why change it now?

SEN. JEFF MERKLEY (D), OREGON:  Well, actually, Ed, we‘re not planning to gut it, we‘re planning to make it do what we all think it does, that is if 41 folks say, debate should continue, then the debate should continue but you shouldn‘t be able to object, go home to dinner, take a vacation and never appear on the floor and explain to the American people what to stand for.  So, if you say to be continued, you need to be ready to have continuous debate on the floor, make your stand, give the American people the ability to say, hey, you‘re a hero or you‘re a bum, but not to just simply leave the Senate paralyzed, unable to do anything.  

SCHULTZ:  So with today‘s politics, it was really not intended to be a standard operating procedure of political tool to stop an agenda?

MERKLEY:  No, that‘s right.  This was all about making sure that every voice is heard before a decision is made but that courtesy has now been turned into a regular abusive practice.  For example, on food safety, a bill we just completed.  There was a filibuster on motion to proceed to the bill, on an amendment on the bill, and on final passage of the bill and each time and we think filibusters stand on the floor and talk, no, it‘s simply an objection that is filed and when that objection is filed, then in fact—and I‘m losing my sound here, sorry—when that objection is filed, then they can walk away and we don‘t have debate on the floor.  So, we‘re saying there must be debate on the floor that serves the people, that serves America. 

SCHULTZ:  And how do you think Republicans are going to respond to this you?  You know, the shoe‘s always on the other foot at one time or another in history.  I mean, do you think that they recognize that this has to be amended in some sense?

MERKLEY:  Yes, I think that they realize that the Senate is broken whether republican or democrat being unable to act because the Senate has to sit around and continuous form of call, doesn‘t work.  And they‘re looking down two years, whatever we do now, we have to say, we have to be willing to with this when we‘re in the minority. 

SCHULTZ:  Well, that‘s true.  And that‘s the thing, is that the minority voice isn‘t going to be as strong if this is changed the way you want it, I mean that‘s how I see it.  

MERKLEY:  I think that it‘ll be stronger because we‘ll be on the floor making our case to the American people.  Not filing an objection and taking off on vacation.  

SCHULTZ:  Yes, but when it‘s a simple majority, that changes things, doesn‘t it? 

MERKLEY:  Well, it doesn‘t take it to a simple majority.  We leave in place under this reform, the 60/40 structure.  We just say, as long as you think, you have 41 that want to continue debate, debate has to continue, but it has to be debate.  Not some motion that leaves us doing nothing for days at a time the way it is right now. 

SCHULTZ:  Senator. 

MERKLEY:  This is a pretty.

SCHULTZ:  Yes.  It‘s a pretty what?

MERKLEY:  It‘s a pretty minor change, in the sense that it does what American people think, that you‘re going to stand up and make your case.  

SCHULTZ:  Senator, good to have you with us tonight.  Thanks so much. 

I appreciate it.  

MERKLEY:  Good to be with you.  

SCHULTZ:  Coming up, that crazy Michele Bachmann just hired 9/11 truther judge, a Lion TV host and an all-around wacko to teach constitution classes.  We‘re ripping into the clowns, next.  Stay with us.    

(COMMERCIAL BREAK)

SCHULTZ:  And finally tonight Congresswoman Michele Bachmann is starting a constitutional class for her new Tea Party and colleagues in the House.  It‘s a dandy.  The class kicks off in January.  And it sounds like it‘s going to be just shaping up to be a crazy conservative version, I guess you could say, offspring training.  Here‘s how Bachmann describes the course.  

(BEGIN VIDEO CLIP)

We‘re going to do what the NFL does and what the baseball teams do.  We‘re going to practice every week, if you will, our craft, which is studying and learning the declaration, the constitution, the bill of rights.  I‘m hoping all of the members of the Congress will bitake its bipartisan.  

SCHULTZ:  Bipartisan.  Well, let‘s take a look at some Bachmann speakers, constitutional expert Sean Hannity, I bet he knows a lot about the constitution, 9/11 truther Andrew Napolitano and Glenn Beck University Professor David Barton.  And the first class of the year will feature Supreme Court Justice Antonin Scalia, the activist judge who handed the presidency to George W. Bush back in 2000.  Now, I‘m Nancy in the bipartisanship, she‘s talking about the lineup.  Maybe the next guest cans kind of square things away for us. 

Let‘s bring in John Nichols, he‘s a Washington correspondent for “The Nation.”  I thought for sure you would have been on there.  You wrote a piece on Bachmann‘s new constitution class.  This is comedy hour, is it not?  What do you think of it?

JOHN NICHOLS, “THE NATION”:  Well, it‘s comedy hour, Ed, except for one thing, you have a justice of the United States Supreme Court.  In fact, the guy who most people believe is the central justice on that court, the guy who defines its direction going in, having private meetings with Michele Bachmann and then ranging, deciding, to come down and have this private session with right-wing members of Congress and he‘ll be followed in one of the ensuing sessions by a guy who says that the separation of church and state is a myth.  I don‘t mind Michele Bachmann making a fool of herself but what really troubles me is that we have a U.S.  Supreme Court Justice hanging out with people who deny the basic truths of our constitution.  

SCHULTZ:  Has this ever been done before?  Has a judge ever been this actively involved with a member of Congress going down the road of ideology?

NICHOLS:  Well, it‘s possible you could say William O. Douglas was pretty close to Franklin Roosevelt and you‘ve had some other several claims over the years, but this goes beyond it.  This isn‘t just a justice of the court working with leaders of Congress or the president on a very complex issue.  This is the justice of the U.S.   Supreme Court sitting down with a member of the republican caucus who was rejected by her own colleagues for a leadership position because she‘s too crazy.  

SCHULTZ:  And a Supreme Court justice showing up on the list with a 9/11 truther.  What is that say?

NICHOLS:  Well, it says a lot but I‘m actually more concerned about this professor who claims that separation of church and state is a myth. 

SCHULTZ:  Yes.

NICHOLS:  It‘s not a myth.  Thomas Jefferson said that that was an essential part of the first amendment.  

SCHULTZ:  John Nichols of “The Nation.”  Always a pleasure.  Great to have you with us tonight.  Tonight in our text survey, I asked, do you believe President Obama‘s tax compromise with Republicans will create jobs?  Twenty three percent of you said yes, 77 percent of you said no.  That‘s not a good number. 

That‘s THE ED SHOW.  I‘m Ed Schultz.  “HARDBALL” with Chris Matthews starts right now.  We‘ll see you back here tomorrow night at 30 rocks in New York.  

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