updated 2/2/2011 2:11:52 PM ET 2011-02-02T19:11:52

Guests: Dylan Ratigan, Ashraf Kahlil, Byron Dorgan, David Cay Johnston, Josh Horwitz

           

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

These stories are hitting “My Hot Buttons” at this hour:

Egyptian President Hosni Mubarak says that he won‘t run for reelection, but protesters in that country want him out now.  Not later.

When he was governor of Massachusetts, health care mandates—they weren‘t a problem.  And he said his state should be the model for the rest of the country.  But now, Mitt Romney tries to explain why mandates are unconstitutional.  Hey, Mitt, been doing any windsurfing?

And Utah makes a move to designate a state firearm.  Wow.  While a Republican proposal in South Dakota would force every adult to buy a gun.  We‘ll talk guns later in the show tonight.

But this is our top story tonight: Hosni Mubarak‘s claim that he will step down after the September elections and end his reign of 30 years is being met with skepticism by hundreds of thousands of protesters who want him to step down immediately.

A massive crowd watched Mubarak‘s 10-minute speech tonight on a giant TV screen in Cairo‘s Liberation Square.  Protesters booed and chanted, “Leave, leave,” after Mubarak announced he would not run again but will serve out the rest of his term.

Mubarak‘s announcements came after President Obama publicly urged the Egyptian leader not to run for another term.

President Obama addressed the situation in Egypt after Mubarak spoke. 

He said an orderly transition must begin now.

(BEGIN VIDEO CLIP)

           

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  Now, it is not the role of any other country to determine Egypt‘s leaders.  Only the Egyptian people can do that.  What is clear, and what I indicated tonight to President Mubarak, is my belief that an orderly transition must be meaningful, it must be peaceful, and it must begin now.

(END VIDEO CLIP)

SCHULTZ:  And at this hour, it‘s unclear how long the Egyptian protests will continue, but the reverb rations of this uprising are being felt throughout the Middle East and the rest of the world.

After weeks of protests in Jordan over the price of food and other issues, King Abdullah fired his government earlier today.  Abdullah has changed his government in the past, but this time is the first time he‘s done it in response to public demand.

For all of the latest, joining us now from Cairo is Ashraf Kahlil, a contributor to “Foreign Affairs” magazine.

Ashraf, thanks for your time tonight.

In the wake of President Mubarak‘s announcement today, is it genuinely being accepted by the Egyptian people, or do they want him out now?  And what do you think the timetable is going to be for all of this?

ASHRAF KAHLIL, FOREIGN AFFAIRS MAGAZINE:  Well, as far as the protesters that are in Tahrir, there‘s still a good 10,000 there camping out on a very chilly night.  The answer is a resounding no, the chants of “Down, down with the president, down, down with the regime” started up again literally like 30 seconds after he had finished his speech.  So, it is a clear rejection by the protesters.

But the question is, whether or not other segments of society will find that acceptable.  I think there is going to be a certain segment of Egyptians that is happy to see him go and will regard the battle as won, and maybe doesn‘t see the need to feel him humiliated.

So, it will be interesting to see how much traction his latest concession draws with the Egyptian people.

SCHULTZ:  How important is the protest coming up on Friday which is now being billed as the biggest to date in the wake of his announcement?

KHALIL:  Well, the protesters are obviously planning for that to be yet another decisive blow.  They want mass numbers again.  I wouldn‘t be surprised if the protests for the next two days are medium-sized.  They will continue to hold on to Tahrir.

But, you know, people—the protesters are tired and people will probably go home in shifts and then they want Friday to be another massive, unmistakable message to the government and to the world.

SCHULTZ:  But do you think Mubarak will move out on his timetable or the people‘s timetable?

KAHLIL:  It‘s a staring match.  It really is right now.

I mean, the protesters have no intention of letting up.  They plan to keep the pressure on.  They feel the momentum is on their side.  Every one of President Mubarak‘s sort of half concessions that he‘s offered in recent days has just motivated them and energized them and made them a little angry that he‘s still holding on.

But President Mubarak is, you know, he‘s not a weak man.  He is a genuine war hero and he is proud and he is stubborn.

So, we shall see.  It‘s going to be a fascinating stand off.  And it looks like it‘s going to go on for a little longer.

SCHULTZ:  Ashraf Kahlil, “Foreign Affairs” magazine—thanks for joining us tonight from Cairo.  Appreciate it.

It‘s not just Egypt and Jordan.  Yemen and Tunisia have also had mass protests.  They‘re all autocratic, majority Muslim nations.  But they‘re not all oil states.  And Tunisia is mostly secular.

So, what else do these countries have in common?  One thing is high food prices—a factor in how all the riots really started and how all of it started.  And it‘s not a coincidence that all of them have high food prices right now.  Food prices have skyrocketed around the world and a big reason for that is Wall Street.

(BEGIN VIDEOTAPE)

SCHULTZ (voice-over):  It started in 1991 with—surprise, surprise -

Goldman Sachs.  Before then, Wall Street speculators played only a minor role in food prices.

           

The way it worked, food companies and their suppliers, America‘s farmers, wanted to keep their business stable, even if prices spiked for wheat, corn, or other agricultural commodities.  So, they‘d hedge their bets, signing contracts, futures, to lock in prices for some point in the future.  Speculators helped, putting enough money in the system to keep things liquid.

After the Depression, FDR saw that speculators could drive up the price of wheat, corn, whatever, by betting on commodity futures the way Wall Street later bet on dotcoms.  Distorting food prices like that could destroy the very stability future contracts were created to provide.  So, FDR signed into law what are called position limits—limits on how much of the total betting could be done by Wall Street.

And what do you know?  It worked.  For decades, the price of wheat was driven by fundamentals like the weather, and Wall Street couldn‘t stand it.

In 1991, Goldman Sachs asked the Commodity Futures Trading Commission, the CFTC, to give them a waiver on those position limits, so they could bet as much as they wanted.  A CFTC appointee for the first President Brush said sure.  More than a dozen other firms followed suit.

Goldman Sachs even created commodities indexes to simplify the betting and goose casual investors into the casino.  Again, Wall Street followed suit.

Remember the real estate bubble?  Wall Street wanted to hedge all of those bets it made on mortgages.  So, they ramped up their bets on commodities.  And when Wall Street started losing money on subprimes, they bet it on commodities instead.

By 2008, Wall Street had five times more futures contracts in commodities than it did in 2002.  Commodity indexes held about $13 billion in 2003.  By 2008, it was over a quarter trillion.  That‘s how we got the oil bubble, and record high gas prices added to the cost of shipping food, plus speculators looking for another bubble—and you get a food bubble.

By 2008, the U.N. estimates speculators held 65 percent of corn futures‘ contracts, 68 percent of soybean, 80 percent of wheat.  By mid-2008, the IMF food price index jumped more than 80 percent in just a year and a half before.

It was the first time in history the proportion of people going hungry worldwide went up.  The number of chronically malnourished people rose by 75 million in 2007, 40 million in 2008.  That‘s why Egypt had riots back in 2008.

Along with 30 other countries, Italian moms marched against the price of pasta.  Wall Street speculators admitted they were doing it.

In 2006, Merrill Lynch said speculation accounted for 50 percent of the price of commodities, half the price.  In 2008, a Goldman Sachs research paper said, quote, “Without question, increased fund flow into commodities has boosted prices.”

2009, even Republican Senator Tom Coburn admits the speculation, quote, “helped to inflate futures prices and thereby disconnect futures from cash prices, impairing farmers‘ and grain elevator operators‘ ability to hedge price risk.”  Got that?

Even Coburn said there was so much Wall Street money distorting prices that farmers and other guys who actually need commodity futures couldn‘t use them to keep their companies stable anymore.

We don‘t notice price hikes so much because most of our food prices come from marketing and packaging.  But in the developing world, the price of food is everything.

And what country imports more wheat than any other?  Egypt—where the price of wheat rose 70 percent last year.

Last summer, Goldman called a report on the role of speculation in food prices, quote, “misleading and blamed other factors.”

A lot of reports mentioned that Russia cut off its wheat supply last year.  What they don‘t tell you is why.  Because futures traders asked them to.

(END VIDEOTAPE)

SCHULTZ:  Let‘s bring in my colleague, Dylan Ratigan.  He‘s got his own show right here on MSNBC week days at 4:00, formerly of CNBC and Bloomberg News.  Thanks for coming in tonight, Dylan.  I appreciate it.

DYLAN RATIGAN, HOST, “THE DYLAN RATIGAN SHOW”:  It‘s a pleasure.

SCHULTZ:  I know that you have talked a lot about speculators and what has happened on Wall Street but this has really been a tsunami in the food world, which has caused a lot of havoc around the world.

Tell us, these price hikes, strictly due to speculation?

RATIGAN:  No.  First, I want to compliment you on your reporting, Ed.  I think you just did an exquisitely good job of describing the contributing factor that financial speculation has been in the spike not just in food prices but also in energy prices.

Unfortunately, there are other factors also in the financial community that are even more sinister.  There‘s a mathematical certainty, Ed, that is this: all the paper currency in the world, all the money, all the paper, must by definition equal the value of all the commodities, because a commodity is equal to what the value of the currencies are in the world.

In order to cover up the massive bank theft that‘s been perpetrated in this country in 2008, the Federal Reserve, under the guidance of first President Bush and now President Obama as you know, Ed, has been printing trillions of new dollars and people, smart financial planners, have been concerned about the debasing effect that has on our currency.  Well, as a direct result of the Federal Reserve‘s money printing, to cover up our bank theft, that has been an additional factor in causing commodity prices to explode higher.

So, in addition, to the speculative aspects that you describe so well, a by product of the Federal Reserve and the White House and the Treasury‘s decision to go with money printing as a way to prop up our economy, is driving food prices higher.

SCHULTZ:  You know, it‘s just an amazing domino effect.  There is no doubt.

But what exactly are these commodity markets supposed to be accomplishing?

RATIGAN:  Well, very simply, they‘re supposed to create price stability as you described in your piece.  There is a very, very valid role for a futures market in commodities both for food consumers who would like to be able to have a stable price for bread, a stable price for milk, a stable price for cheese and meat, not just here but around the world, cous-cous, rice, tortillas, pasta, I don‘t care where you live.

And if you are a farmer, you want to know that you can lock in a price on your farm in this country or any other for that price.

The position limits, which you referenced, are critical in that they represent a limit as to how much grain could potentially actually exist.

SCHULTZ:  Yes.

RATIGAN:  The elimination of the position limit makes it such that you can suddenly buy more grain than exists on the entire planet because now you‘re just speculating on the price or potential price and creating all the price inflation you described so well.

SCHULTZ:  High prices, rural America does well.  That Ag dollar turns seven times on Main Street.  So, America is loving this stuff as far as the Ag economy is concerned.  Then you take a look at the construction of—and the manufacturing of all the big equipment that goes with it.

But somebody pays a price down the line.  And in this case, it is people of these countries that are run by dictators that can‘t provide for their people.  There‘s the snowball effect.

RATIGAN:  Well, yes, I would say it‘s really the poorest billion—

whether it‘s the poor in the Middle East, the poor in Asia, or the poor in

Louisiana and Arkansas, those are the only people who suffer from the

financial shenanigans perpetrated at the highest levels of our government -

-

           

SCHULTZ:  Yes.

RATIGAN:  -- and our financial institutions.

What really has struck me about this event in Egypt, Ed, is that for all of our carrying on about the spread of democracy through military assault and the death of our own soldiers and Iraqi civilians, all you had to do was double the price of grain in the Middle East from your trading floor in Goldman Sachs to receive the democratic revolution we claim to be in favor of with our military the past 10 years.

SCHULTZ:  Dylan Ratigan host of his own show week days at 4:00 here on MSNBC—and you‘re going to be covering this story on your show tomorrow.  And I appreciate that.  It is the story right now—

RATIGAN:  That‘s it.

SCHULTZ:  -- on the face of this earth.  Dylan, thanks so much.  I appreciate it.

And I‘ve got the senator who predicted all of this standing by for what Washington‘s going to do about it if anything.  I want your take too.  Get your cell phones ready.  Tonight‘s text question just moments away. 

Tell us what you think.

The president wants to cut small business, right?  Taxes.  John Boehner says, not so fast.  But Mitt Romney says the president—he‘s the one who is anti-business.

Don‘t you believe it.  We‘ve got the truth.

And after we call out Ohio Republican Governor John Kasich for his all white cabinet today, Kasich responds.  You‘ll love this one.

And Republicans want to make a point about individual mandate.  So, they want everybody in South Dakota to just buy a firearm.  Boys, you‘re shooting blanks on this one.

It‘s all coming up.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Massachusetts got it right says former Governor Mitt Romney.  But President Obama and the Democrats got it wrong.  Mandate is good, mandate is bad.  Make your own mind up there, Governor Romney.

Plus, with Wall Street helping to jack up food prices all around the world, we‘ve got lots of instability throughout the Middle East.  What will Washington do about it if anything?  Former North Dakota Senator Byron Dorgan joins us on that story.

And right now, it‘s time to get your cell phones out.  I want to know what you think.  Tonight‘s text question: Is Wall Street‘s speculation in global food prices a national security problem?  Text “A” for yes, text “B” for no, to 622639.  We‘ll bring you the results later on in the show.

(COMMERCIAL BREAK)

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

Food riots across the Middle East and Wall Street has their fingerprints all over it.  And don‘t think it can‘t happen here.  I mean, folks, we did have $4 a gallon gas, didn‘t we on speculators?

And it could happen again.  The USDA predicts our food prices are going to be going up this year.  President Obama campaigned on doing something about this.  But we haven‘t seen any results as of yet.  I know there‘s a lot going on.

And with Republicans in control of the House, it‘s not clear we will get anything done until it‘s too late.

Let‘s bring in North Dakota Senator Byron Dorgan, just recently out of the Senate who sat on the commerce committee among others, comes from a farm state and predicted more than 10 years ago what deregulation was going to mean to this country.

Senator, thanks for staying with us tonight.  I appreciate your time.

How did this all happen?  If you can just pin it down for us—how did this all happen?

FMR. SEN. BYRON DORGAN (D), NORTH DAKOTA:  Well, you know, the Congress, the government gave a green light to the big financial firms in this country and said, do what you want to do.  We won‘t look.  We‘ll put regulators who are willfully blind in place and you do whatever you want to do.

The result has been unbelievable speculation in the commodities.  We‘ve seen oil go to $147 a barrel on day trading.  It had nothing to do with supply and demand, had everything to do with greed and speculation.  Same is true now with food.

And the interesting thing is we now understand that what lights the fuse in some of these countries—Egypt, Jordan, Tunisia, Yemen, is the price of food sparks the protests.  It has people in the streets.  Yes, there‘s a passion for freedom, but they‘re in the streets driven at least in part by this increase in food prices and now as you say we see fingerprints from Wall Street all over this, with unbelievable excess speculation.  It has to stop.

SCHULTZ:  And we know that the Republicans are not about regulation.  They‘re about deregulation.  And we could see more of the same.  I mean, I don‘t see anything stopping this freight train coming.  Do you?

DORGAN:  Well, we will see more of the same.

Now, I know there was a financial regulation and reregulation passed by the Congress.  But, you know, frankly, it moved in the right direction but it was a feather dusting not a spring house cleaning, which is what we really need.

We need to go back and say, look, these markets are there for a purpose, legitimate hedging and so on, but when there is excess speculation, get the speculators out of those markets.  If they‘re going to pervert those markets, get them out of those markets.  See what they do.

I mean, this issue of food pushing people into the streets in other countries is destabilizing to the world.  It has a national security impact on this country.  I think it‘s time for us to get a grip and decide as a country we won‘t allow this excess speculation.  It is dangerous to our future.

SCHULTZ:  Senator, you have conference with Hosni Mubarak on numerous occasions.  How do you see today‘s developments?  How stubborn is he?  What do you think the timetable is going to be for him leaving office?

DORGAN:  Well, I‘ve met him both here and also in Cairo, and I don‘t know—yes, I don‘t think anyone knows exactly how this plays out from this day forward.  But, clearly, he‘s made some concessions today.  And we‘ll see what the Egyptian people think of that in the coming days.

But Egypt is very important to us and to the Middle East and you know the president is playing I think a constructive role in trying to push and yet not push too far here.  So, we‘ll see in the coming days what this means.

Clearly, President Mubarak is not going to run for re-election.  He told the Egyptian people today.  That is a significant step forward.

SCHULTZ:  Do you think the protests brought him to this point?  I mean, the guy is 82 years old.  He says he wants to die in Egypt.

DORGAN:  Yes.

SCHULTZ:  Meaning, he wants to stay with some dignity in his own country.  The bottom line here is that these protests aren‘t going to stop.  So, there‘s still a lot to be decided about his future.

DORGAN:  Well, I mean, he doesn‘t look 82 years old, by the way.  But, he‘s been there a long time.  There‘s a built up passion by the Egyptian people.  They want the taste of freedom more than he has given them—and we‘ll see.  I don‘t think—

SCHULTZ:  What‘s your opinion of possibly an extremist coming to power in that country?

DORGAN:  Well, I worry about that.  I think we worry about that not just in that country but other countries as well.  You know, that you saw that the leader of Jordan took action today to form a new government.  Having a lot to do with food price increases that concerned the people in Jordan but—

SCHULTZ:  And what do you make of the president saying that he needs to move now?  Mr. Mubarak—I mean, the president came out today and said you need to move on this now.  What does that mean?

DORGAN:  Well, I think the president is trying to push and yet not push too far.  I think he has pushed to the point that had an influence on what President Mubarak said and that was that I‘m not going to seek re-election.  I think President Mubarak is hoping that will satisfy the Egyptian people because that election would occur later this year.

But we‘ll see.  I hope very much that this gets resolved the right way, the people of Egypt live in freedom in the future.

And I also hope we understand from this circumstance that we have to do something about excess speculation and commodity markets, not just with respect to the situation in Egypt but here at home as well—food, oil, and other commodities.  That‘s for hedging not for speculation and excess gambling that‘s going on.

SCHULTZ:  Senator Dorgan, thanks for your time tonight.  Appreciate it very much.

We‘re going to stay on this story tomorrow with the people standing in the way of fixing this.  We‘re naming names tomorrow here on THE ED SHOW.

Still ahead: it‘s supposed to be some kind of joke.  We‘re not laughing.  The proposed bill in South Dakota.  Turn 21, buy a gun, and spread the fear in the name of self-defense?

Former Massachusetts Governor Mitt Romney, for it before he was against it.  He‘s the de facto leader of a pack of Republicans who once supported the individual mandate in health care.  The list, of course—that is—the GOP is shifting all over on this.  We‘ll bring you that story.

Stay with us.  We‘re right back.

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW, and thanks for watching tonight.  The Republican assault on health care reform continues.  Senate GOP leaders are forcing a vote on repealing the health care law.  And a U.S. district judge in Florida ruled that the individual mandate provision was unconstitutional. 

Now, some Republicans who once supported a mandate for health insurance are pumping the brakes.  Take Mitt Romney for example, who enacted an individual mandate as governor of Massachusetts.  Turns out he was only for the mandate before he was against it. 

(BEGIN VIDEO CLIP)

MITT ROMNEY, FORMER GOVERNOR OF MASSACHUSETTS:  We are a federalist system.  We don‘t need the federal government imposing a one size fits all plan on the entire nation. 

UNIDENTIFIED MALE:  But what he was talking about specifically was this requirement that people buy health insurance.  And you had exactly that same requirement in Massachusetts.  Why is it right for a state to impose that kind of a mandate and not the federal government? 

ROMNEY:  Well, states have rights that the federal government doesn‘t have.  Under the Tenth Amendment of the Constitution, the powers of the federal government are specifically limited. 

(END VIDEO CLIP)

SCHULTZ:  So, Massachusetts health care is not a model for national reform according to Mitt Romney today?  Let‘s see what Mitt Romney of 2009 would have to say about that. 

(BEGIN VIDEO CLIP)

SCHULTZ:  Massachusetts is a model for getting everybody insured in a way that doesn‘t break the bank, and that doesn‘t put the government into the driver‘s seat, and allows people to own their own insurance policies and not have to worry about losing coverage.  That‘s what Massachusetts did. 

(END VIDEO CLIP)

SCHULTZ:  All right, mister.  We know you‘re distancing yourself from the individual mandate because you want the GOP presidential nomination in 2012. 

But don‘t feel bad, Mitt.  You‘re not alone.  Here‘s a partial list of fellow Republicans who have supported the health care mandate since their party first proposed it in 1993: Senator Robert Bennett, Senator Kit Bond, Congressman William Clinger, Senator William S. Cohen, Senator John Danforth, Senator Robert Dole.  OK, there are a lot of names here.  Let‘s speed it up a little. 

Senator Pete Domenici, Senator Dave Durenberger, Senator Lauch Faircloth, Congressman Wayne Gilchrest, Senator Slade Gordon, Senator Chuck Grassley, Congressman Steven -- (INAUDIBLE)

I‘m trying to speed things up because there are so many of them.  So let‘s just wait a minute here.  Chuck Grassley was on that list.  This Chuck Grassley. 

(BEGIN VIDEO CLIP)

SEN. CHUCK GRASSLEY ®, IOWA:  Not have an individual mandate.  I think it‘s a violation of the Constitution for the federal government to tell you have to buy something. 

(END VIDEO CLIP)

SCHULTZ:  And let‘s not forget that Orrin Hatch once supported the mandate, too.  This Orrin Hatch. 

(BEGIN VIDEO CLIP)

SEN. ORRIN HATCH ®, UTAH:  This would be the first time in history that the federal government requires you to buy something you don‘t want. 

(END VIDEO CLIP)

SCHULTZ:  See, Mitt?  You‘re not alone.  They‘re all plenty of flip-flopping Republicans out there.  And now they‘re not even running for president.  They just want to hurt the current president.  That‘s what it‘s all about. 

Here‘s another strange way to attack health care.  Come up with a law that requires every adult to buy a gun.  And while you‘re at it, try to exploit the fears of gun owners in the wake of the Arizona shooting. 

President Obama is bad for business, they say, even though the stock market has steadily rebounded through his presidency.  He is bad for business?  That‘s what they say, even though he is the one calling for another tax break for small businesses, and even though this man, House Speaker John Boehner, has rejected the idea.  That‘s next.

(COMMERCIAL BREAK)

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

I want to do some role reversal here with this story.  Just bear with me.  I want you to pretend for just a moment that we have a Republican president.  OK?  Hold it right there.  That we have a Republican president.  There is a Republican in the White House.  It‘s not President Obama. 

Now let‘s do this story.  The Dow Jones Industrial Average closed over 12,000 points today, the best finish since before the economic collapse of 2008 -- the best finish since the economic collapse of 2008.  Now, on the last president‘s last day—we won‘t mention names, because you see we have a Republican president.  We‘re playing here.  In the last president‘s last day in office, the Dow closed at under 8,000. 

That means between the president we have right now, his Inauguration Day, and today, the Dow has jumped up 50 percent. 

Hold it right there.  What do you think the Republicans would be saying, if there was a Republican in the White House, about the performance of the stock market?  Do you think Mitch McConnell and John Boehner would be out there saying, look at the stock market; this is our leadership.  Hmm. 

Now let‘s get back to reality.  Barack Obama is a Democrat and he‘s in the White House.  And yet conservative leaders and Republican politicians still say he‘s the most anti-business president ever.  This is what really infuriates me.  It‘s because we don‘t have any honest brokers. 

Here is our friend the Mittster, Mitt Romney again.  Now we can‘t seem to get enough of him tonight on this show, can we? 

(BEGIN VIDEO CLIP)

ROMNEY:  Almost everything he has done in his first two years has made it more difficult for our economy to grow.  It‘s been the most anti-investment, anti-jobs, anti-growth administration we‘ve seen in a long, long time. 

(END VIDEO CLIP)

SCHULTZ:  Anti-growth?  So President Obama‘s anti-growth?  Just ignore the 18 straight months of growth in the manufacturing industry.  Obama is anti-jobs, except for the one million private sector jobs added in the worst economy in 80 years.  And that happened in this past year. 

And President Obama is—get this—anti-investment.  But yesterday, the White House proposed extending capital gains tax breaks for small businesses, again.  This would be the 18th tax cut for small businesses undertaken by the Obama administration.  That‘s if you‘re scoring at home. 

If the Republicans let it happen, that is; House Speaker John Boehner‘s office rejected the president‘s proposal, again.  A spokesman for his office said, quote, “it seems the only thing new being offered by the White House is another catch phrase.  Not until the administration is prepared to break down Washington barriers to create the job creation mandates, costly regulations, and economic uncertainty will we see renewed confidence from American small business owners.” 

Hold it right there.  Just so we have this right, the stock market has gone up 50 percent.  I‘m just asking you tonight watching THE ED SHOW to be a fair minded American.  If you were to take your money and invest it somewhere and just a few years later come back with a 50 percent return on money, would you think you were doing pretty good? 

This is why I‘m going to bare my soul to you tonight and tell you that it‘s hard for me, but I despise the Republicans because they are not honest brokers when it comes to this economy.  All they do is talk it down because that‘s what they‘re really good at.  Because it‘s about defeating President Obama.

And I will tell you that stock market could go from 12,000 to 14,000 to 16,000, and the Mittster and Boehner and McConnell, they‘d all be saying the same thing. 

Joining me tonight is David Cay Johnston.  He‘s a columnist for Tax.com, a Pulitzer Prize winning author, and former tax columnist for the “New York Times.”

Good evening, David.  Great to have you on THE ED SHOW tonight. 

DAVID CAY JOHNSTON, TAX.COM:  Good evening. 

SCHULTZ:  What do you make of this stock market?  Doesn‘t the president get just a little bit of credit? 

JOHNSTON:  Well, presidents always want credit when the market goes up and not when it goes down.  But the fact is we‘ve had very good recovery in the market, not in jobs, not in a lot of other areas, but in the stock market.  And, no, the Republicans aren‘t giving him any credit.

And, you know, Ed, the crucial thing the Republicans are doing here is there is this vague attack, onerous regulations.  Of course, lots of regulations are sought by business.  Many regulations promoted by Republican legislators, acting on behalf of businesses who want to constrain competition, who want to artificially inflate prices and use regulation for their benefit.

And the president has a list of specific accomplishments, a five-year reach back on taxes in the past, losses; the expensing of a half million dollars a year of capital equipment.  Very few small businesses spend more than 500,000 dollars a year on capital equipment.  Just a few years ago, the level was 175,000 dollars.  Where is the specific list? 

SCHULTZ:  Mr. Johnston, why can‘t the Republicans just fess up that this is good stuff for business?  They‘re painting this picture that he‘s bad for business, that he can‘t do anything right.  It‘s all about winning the White House, isn‘t it?  It‘s not about creating jobs. 

JOHNSTON:  It is absolutely about winning the White House and also the

here I would fault the press.  They‘re not saying to the Republicans, well, where are your specific plans?  Which onerous regulations?  How will your plan work better?  By the way, the biggest question of all, which you talked about earlier, when are you going to take the burden of health care off the backs of small business? 

SCHULTZ:  Yeah. 

JOHNSTON:  There is nothing more you could do to create jobs and to help small business in America than to get health care off the backs of small business. 

SCHULTZ:  Well, I‘ve said all along that it‘s a travesty we didn‘t get a Congressional Budget Office report on universal health care.  Universal health care would be the best thing this country could ever have.  It would be the best thing that small businesses could ever get. 

But, of course, we‘re finding out it‘s not about small business.  It‘s about big business.  It‘s about rates to small businesses.  It‘s about the restriction of money to the people who want to be the entrepreneurs, until the right dude gets in the White House.  That‘s how I read it. 

JOHNSTON:  Ed, I agree with you about that.  It is also about finding ways to keep small business from being able to compete.  One of the ways you do that is health care.  So long as we have the current system, big businesses pay what is essentially the real cost of health care; little businesses pay a premium, which puts them at a further disadvantage to compete. 

So you want to suppress small business, you continue to pursue our current program, which leaves a quarter of Americans at some point each year with no health care, a sixth of Americans with no care, over 120 people a day dying unnecessarily. 

SCHULTZ:  No doubt. 

JOHNSTON:  Because the only thing they have access to is emergency room care. 

SCHULTZ:  And we need to sound the alarm that this narrative that the Republicans have got out there about President Obama being anti-business is bogus.  Look at the facts. 

JOHNSTON:  Yes. 

SCHULTZ:  David Cay Johnston, great to have you with us tonight.  Hope you come back on THE ED SHOW. 

The mounting troubles for Ohio Governor John Kasich.  Yesterday, an African-American state senator came on this show and told you Kasich said, quote, “I don‘t need your people.”  Today, the governor tries to deal with the problems of his all white cabinet, but not very successfully. 

Plus, your last chance to answer tonight‘s text question before we get the results. 

And a new gun proposal just perfect for the wild, wild west.  You‘re watching THE ED SHOW on MSNBC.  Stay with us.  We‘re right back. 

(COMMERCIAL BREAK)

SCHULTZ:  Welcome back to THE ED SHOW.  Thanks for staying with us tonight.  This is a favorite one of mine, because we‘re not going to let it go.  Ohio Governor John Kasich is trying to make his racial diversity problem disappear.  Kasich is taking heat because he‘s the first Ohio governor in nearly 50 years to appoint an all white cabinet.  I guess everybody was wrong for 50 years. 

Ohio State Senator Nina Turner appeared on this program last night to discuss her call for Governor Kasich to add a person of color.  I asked her if she thought the governor was a racist. 

(BEGIN VIDEO CLIP)

SCHULTZ:  Do you think the governor of Ohio is a racist? 

NINA TURNER, OHIO STATE SENATOR:  Well, I‘m not sure, Ed.  That is a question you need to ask him.  But I will say that his actions so far certainly shows a strong insensitivity and appreciation for diversity.  You know, our diversity is our strength and we should embrace it. 

(END VIDEO CLIP)

SCHULTZ:  Governor Kasich must have rabbit ears.  Just today, he issued a statement commemorating Black History Month and announcing a director of minority affairs.  Kasich named Lynn Stevens, a person of color, to the position.  That‘s great news. 

But there‘s a slight problem.  Think Progress points out Stevens has been the director of minority affairs for nearly a month.  And her position is not cabinet level.  Nothing has changed.  Kasich still has 23 white cabinet officers. 

We invited Governor Kasich to come on the program tonight to give us his take.  His office has yet to respond.  We‘d like to have him come back tomorrow night.  I guess the subject would be innovative hiring. 

The topic was on fire on my radio show today.  And with record unemployment, the issue of quotas isn‘t easy to swallow for a lot of Americans.  But it‘s hard to believe that Governor Kasich can‘t find one qualified person of color in the entire state of Ohio to be on his cabinet. 

And isn‘t it interesting tonight, e-mailer from Ohio writes me and says that Jerry Ray ordered all TVs turned to Fox News in the state cafeterias of the Ohio Department of Transportation.  Chief Jerry Ray sent that order out. 

Wouldn‘t have anything to do with the fact that Kasich used to have a show over on Fox, do you think?  Nah. 

Most states have a bird.  Utah wants to have a gun.  I guess so you can shoot the state bird with the state gun. 

In South Dakota, they say they are trying to make a point about health care mandates by proposing a law that would require every adult to buy a gun. 

Plus, the results of our text survey.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Our final story tonight, guns.  In the weeks since the Tucson shootings, there‘s been a fear felt by many in this country, fear that the government will take away your firearms and there will be more restrictions. 

So how are the states responding?  By making it easier to get them?  Let‘s go to Minnesota, where Republicans are pushing a—really?  They want to eliminate the state background check required to purchase a gun.  A House panel has approved the repeal.  And they argued that the state check is redundant. 

And here‘s what they mean by redundant.  Last year, 541 people applied to buy a gun in Bloomington, Minnesota.  The state background check flagged 37 of those applicants after a history of drugs or mental illness showed up.  Now, had the city of Bloomington, Minnesota only relied on the federal background check, all 37 of those applicants would have been approved. 

Utah Republicans want to be the first in the nation to have their own state gun, the Browning M-1911 Semiautomatic Pistol.  Here is how Republican State Senate Representative Carl Wimmer puts it: “naming an official state firearm is as harmless as naming an official state cooking pot.” 

Also from the category of you can‘t make this stuff up, something out of a Clint Eastwood movie is taking shape in South Dakota.  State Representative Halwick (ph) -- he‘s a Republican—he is proposing a bill that would force every South Dakotan over 21 years of age to buy a firearm in order to ensure ordinary self-defense. 

Residents are allowed to pick a firearm suitable to their temperament, physical capacity, and preference.  Now Mr. Wick knows this measure won‘t pass.  He just wanted to take a swipe at the federal health care law.  You know, the mandate thing.  And push the Republican notion that citizens shouldn‘t be required to buy health insurance. 

Time now to call in Josh Horwitz, the executive director of the Coalition To Stop Gun Violence.  Josh, thanks for your time tonight.  Are we—

JOSH HORWITZ, COALITION TO STOP GUN VIOLENCE:  thanks for having me. 

SCHULTZ:  Are we seeing more crazy gun proposals in this legislative session of all the states in this country?  What do you think? 

HORWITZ:  Well, look, it‘s been building for the last couple years.  This is just an attempt I think by the NRA and some of the Republicans to sort of normalize guns for everybody at all times.  Some of these laws, you know, they‘re funny, right?  I mean, the South Dakota law sort of makes you chuckle. 

But in reality, South Dakota‘s got a serious gun problem.  It‘s the ninth leading state for suicides and most of those are firearms.  Like Arizona, it has very few—it has no mental health check of prohibited person—you know, the kind of check that keeps someone like Jared Loughner from getting a firearm.  So the idea of now suggesting that everybody over 21 should get a firearm is just sort of arming the next Jared Loughner. 

SCHULTZ:  In the state of Utah, 67,000 concealed weapons permits went out last year; 50,000 of those folks weren‘t even in the state, not residents.  What do you make of it?

HORWITZ:  Look, some of these states are courting trouble.  They‘re opening their concealed carry permit holders to folks who don‘t live there.  They don‘t have good records to see who should be prohibited and shouldn‘t.  These people—you know, there‘s reciprocity between a lot of different states.  Maybe you live in Minnesota.  You get a Utah permit and then you end up carrying in Ohio. 

SCHULTZ:  What about that Minnesota—the state background check, eliminating that, and the federal would have never caught those 37 people we talked about. 

HORWITZ:  Look, I do a lot of work in Virginia.  The gun lobby is trying to do the same thing.  It is not redundant at all.  There are a lot of state prohibitions that only the state police know about.  If you don‘t check those state databases, you don‘t catch those state felons and it‘s terrible. 

SCHULTZ:  So we haven‘t learned anything from Tucson it seems like.  Josh Horwitz of the Coalition to Stop Gun Violence, thank you for joining us tonight. 

Finally tonight, the results of our text survey.  I asked you is Wall Street speculation in global food prices a national security problem?  Ninety four percent of you said yes; six percent of you said no.  That‘s THE ED SHOW.  I‘m Ed Schultz. 

For more information on THE ED SHOW, go to Ed.MSNBC.com or check out my radio website at WeGotEd.com.  Tell me what you think on Facebook.com/EdSchultzShow, or talk to me on Twitter at Twitter.com/WeGotEd.  “THE LAST WORD” with Lawrence O‘Donnell starts right now.  We‘ll see you tomorrow night. 

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