updated 4/6/2011 2:31:48 PM ET 2011-04-06T18:31:48

Guests: John Nichols, Sen. Bernie Sanders, Rep. Donna Edwards, Katrina

Vanden Heuvel, David Cay Johnston, Leo Gerard

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

All eyes on Wisconsin tonight, and there is breaking news out of that state and the Supreme Court election that is widely considered a referendum on Scott Walker‘s union-busting law.  The “Associated Press” reporting at this moment 12 percent of the vote is in.  David Prosser, the incumbent Republican with 51 percent of the vote.  JoAnne Kloppenburg, the challenger, the Democrat, assistant attorney general, she is in at 49 percent.  It is very early.

Tonight, John Nichols, Washington correspondent of “The Nation,” joins us from the Kloppenburg headquarters.

John, this is, seems to be very, very tight tonight starting out.  Do you expect it to be this way all the way to the finish?

JOHN NICHOLS, THE NATION:  It could well be, Ed.  This has been an incredibly intense race, the most expensive court race in Wisconsin history and, obviously, with that overlay of the governor‘s bill and controversy around it.  But I can tell you something you‘ll understand, Ed, as somebody who spent a lot of time reporting out of North Dakota.

In Wisconsin the rural areas come in first.  Those numbers that you‘re seeing include not a single vote from the city of Madison and I don‘t believe any votes from the city of Milwaukee.  That‘s very, very significant because those are the core areas where I think you‘re going to see big numbers run for JoAnne Kloppenburg.

SCHULTZ:  John, our computer is showing that there are some votes coming in from Dane County which is, of course, heavy Kloppenburg area.  There are very few precincts reporting in Milwaukee.  It‘s just way too early to tell.

But the turnout tonight, we are hearing reports that in Fond du Lac, there is a shortage of ballots.  But the turnout around the state, has it been heavy?

NICHOLS:  It‘s been incredible, Ed, an unprecedented turnout.  This will be the largest turnout ever for a race of this kind.  And I can tell you that in some areas of Madison, the turnout actually reached in some precincts a presidential level, the same level of voting that you saw in the 2008 race between Barack Obama and John McCain.

It wasn‘t that high everywhere.  But there‘s nowhere in Wisconsin that I know of that isn‘t seeing a higher and in many cases record level turnout for a spring election.

SCHULTZ:  John Nichols, you‘ll be with us through the hour.

           

We will follow the story as everything develops, and it‘s interesting, six weeks ago, the sitting Supreme Court Justice David Prosser was basically viewed as untouchable.  It is going to go down to the wire tonight and we‘ll have it for you through the show here on THE ED SHOW on MSNBC.

The big story, nationally, obviously, is the budget.  Just 74 hours away from a possible federal shutdown, President Obama held a last-minute press conference in the White House briefing room today after negotiations with Speaker Boehner fell apart.  The president put the blame squarely on the speaker.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  What we‘ve been able to do is to present to the House Republicans a budget framework that would cut the same amount of spending as Speaker Boehner and Chairman Rogers originally proposed.  Their original proposal for how much would be cut.  We are now closer than we have ever been to getting an agreement.  There is no reason why we should not get an agreement.

SCHULTZ:  Boehner faced the media right after the president spoke to the media.  The tan man admitted the White House offered a good deal.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE:  The White House is proposing cuts that are far beyond things that we would imagine.  So, we want to get an agreement and we want to keep the government open.

(END VIDEO CLIP)

SCHULTZ:  The White House has offered cuts beyond what Boehner wanted, but the speaker can‘t get the deal done.  Boehner has to decide if he wants to be a grown up or, you know, compromise—and compromise with the president, or face the wrath of the Tea Party and radical members of his party.

Remember this?

(BEGIN VIDEO CLIP)

REP. MIKE PENCE ®, INDIANA:  If liberals in the Senate would rather play political games and shut down the government, instead of making a small downpayment on fiscal discipline and reform, I say, shut it down.

(CHEERS)

(END VIDEO CLIP)

SCHULTZ:  The speaker knows he‘s in a box, but he‘s trying to pin the blame on the White House and the Senate.

(BEGIN VIDEO CLIP)

BOEHNER:  And we‘re not going to allow the Senate, nor the White House to put us in a box where we have to make a choice between two bad options - - cutting a bad deal this week in order to keep the government open or allow the government to shut down, due to Senate inaction.

(END VIDEO CLIP)

SCHULTZ:  And, of course, Harry Reid isn‘t going to let Boehner out of the box.  The Senate majority leader says the Tea Party is calling the shots in the House.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER:  We thought for several days that we were very close to an agreement.  But the meeting at the White House and the negotiations over the weekend really indicated to me, and I think most people who are watching this, that the leadership in the House is being guided by the Tea Party.

(END VIDEO CLIP)

SCHULTZ:  So, have we seen this before?  Reid says that Boehner moved the goal post from $33 billion in cuts to $40 billion.  The speaker is also making another crazy demand.  Reid told reporters, “They‘re saying they won‘t agree to anything unless they get 218 Republican votes.”  Did you hear that, folks?

Speaker Boehner wants 218 Republican votes.  If the speaker put the bill on the floor tonight, he would have a vast majority of the Democrats and the Republicans on the board.  That‘s the way government is supposed to work.  It‘s obvious Boehner doesn‘t have the guts to stand up to the Tea Party members of his caucus.

If the government shuts down at midnight on Friday, America I think can thank John Boehner and the Republican Party.  The last thing the president and the Democrats want is a shutdown to happen now, especially with the recovery going on.

This is how the president put it today.

(BEGIN VIDEO CLIP)

OBAMA:  At a time when the economy is just beginning to grow where we‘re just starting to see a pickup in employment, the last thing we need is a disruption that‘s caused by a government shutdown.  Not to mention all the people who depend on government services.  Whether you‘re a veteran, or you‘re somebody who is trying to get a passport or planning to visit one of the national monuments, or you‘re a business leader who is trying to get a small business loan, you don‘t want delays.  You don‘t want disruptions just because of usual politics in Washington.

(END VIDEO CLIP)

SCHULTZ:  But, of course, Republicans have proven time and time again that they don‘t mind hurting America to score political points.  But if Boehner shuts the government down, it will backfire—political back fire on some folks, OK.  But it‘s going to back fire on the American people because there‘s going to be a lot of Americans out there who are going to be short changed and hurt because of this.

You know, the Republicans always talk about how they love the troops and support the troops.  What about the troops that are deployed?  What about their families back home who are counting on some government assistance, who are going to be hurt by this shutdown?  What about those families?

Republicans ask yourself the question: What‘s that going to do for morale?  Is that supporting the troops in the war zones around the world?  I don‘t think so.

Get your cell phones out.  I want to know what you think.  Tonight‘s question: who is to blame if the government shuts down?  Text “A” for Republicans, text “B” for Democrats to 622639.  And you can also go to our blog at Ed.MSNBC.com.  We‘ll bring you the results later on in the show.

A couple interviews in this segment tonight, joining us now is Congresswoman Donna Edwards of Maryland and Senator Bernie Sanders of Vermont.

Great to have both of you with us tonight.

Senator Sanders, you first.  You told me earlier today that Senate Democrats are ready to go on the offensive about this and it was a very contentious and animated caucus meeting today.  Where does it stand at this hour?

SEN. BERNIE SANDERS (I), VERMONT:  I think you‘re hearing more and more Democrats saying that it is absolutely absurd that at a time when the middle class is collapsing and poverty is increasing that the Republicans are attacking all of the programs that working families depend on including Pell grants for college, Head Start, Social Security Administration, the Environmental Protection Agency which keeps our air clean and our water safe.  All of these programs.

And today, Ed, as you have heard, Congressman Ryan came out with a grand plan and that is to devastate and voucherize Medicare, block grant Medicaid, and what he wants to do is basically dismember all of the programs, all of the programs that working families depend on.

By the way, in the midst of all that, he wants more tax breaks to millionaires and billionaires, more tax breaks for large corporations.

Rich get richer.  They get tax breaks.  The poor get poorer.  They lose programs that are life and death to them.

And more and more Democrats are saying, enough is enough.  We need some revenue in this picture.  We need shared sacrifice.  The wealthy and large corporations have also got to contribute to deficit reduction.

SCHULTZ:  Yes.

SANDERS:  Not just working families.

SCHULTZ:  Congresswoman Edwards, if Speaker Boehner brings $40 billion worth of cuts to the floor, would it pass?

REP. DONNA EDWARDS (D), MARYLAND:  Well, you know, I think it‘s really up to the Republicans to demonstrate some leadership here.  I mean, they‘ve got control of the reins right now.

And I think Senator Sanders said it all.  Republicans are standing there.  Speaker Boehner is being led by the ear by these Tea Partiers and he is willing to sacrifice young people and their college education, Head Start students, seniors, veterans, military service members.

SCHULTZ:  What do you think would pass in the House?  What is the breaking point?  What is the number that the Tea Partiers are holding John Boehner to?  What do you think would pass?

EDWARDS:  Well, I think that they said very clearly, they want $61 billion in cuts.  The reality is that the president has proposed a reasonable approach to a continuing resolution.  The Democrats have signed on to that approach.  And the Republicans would rather shut the government down than to accept a compromise that even I‘m not happy with but I‘d accept it, because it means we could continue government and get on with the business that we‘re supposed to do.

SCHULTZ:  President Obama went on the offensive today.  I thought he had just a hell of a press conference.  Here he is saying what he thinks the American people are concerned about.

(BEGIN VIDEO CLIP)

OBAMA:  They‘re worrying about gas prices and that‘s what they want us worrying about.  They‘re worrying about jobs.  And that‘s what we should be focused on.  They‘re worrying about what—everything happening in the Middle East.  What does that mean for them?  And that‘s certainly what I‘m spending my time worrying about.

And I shouldn‘t have to oversee a process in which Congress deals with last year‘s budget where we only have six months left, especially when both parties have agreed that we need to make substantial cuts and we‘re more or less at the same number.

(END VIDEO CLIP)

SCHULTZ:  Senator Sanders, I want to point out—today on MSNBC, Congressman Tom Price said on this air, that this budget would increase production, create jobs, and keep jobs from being shipped overseas.  You want to respond to that?

SANDERS:  Yes.  This is the same, old trickle down theory of economics works so well under the eight years of the Bush administration that we‘ve lost 600,000 private sector jobs.

Look.  This is their litany.  This is what they believe.

At a time when the richest 1 percent earn more income than the bottom 50 percent and the wealthy are get wealthier, their solution is more tax breaks for the very, very rich.  At a time when working families can‘t find child care, they want to cut back on Head Start.  Families can‘t afford to send their kids to college, cut back on Pell grants.

This is the same old litany.  What they are doing now is simply reflecting the needs of the millionaires and billionaires of this country who fund their campaigns.  That‘s all that it is.

SCHULTZ:  Donna, Congresswoman Edwards, this does hit minorities and the poor extremely hard.  Do you agree?

EDWARDS:  Well, it does.  I mean, it hits the poor especially hard.  I mean, if you look at the proposals, for example, in the Ryan budget dealing with Medicaid, half of the children on med—half of the people on Medicaid are poor children.

Look at the attempts to call a voucher system not really a voucher system for Medicare, and the reality is that that would hit seniors and the disabled harder than it hits anyone.  And so, the Republican budget that‘s been proposed is one that‘s about attacking the vulnerable and then leaving the wealthy to take all of the spoils.

SCHULZ:  Yes.

EDWARDS:  We had a decade of that and we don‘t need another decade.

SCHULTZ:  And, Senator Sanders, finally, do you think the Democrats will give up any more to Boehner?

SANDERS:  I certainly hope not.  Enough is enough.

I think the American people are on our side.  They want shared sacrifice.  They don‘t want to balance the budget as Donna just said on the most weak and vulnerable people of this country.

SCHULTZ:  Congresswoman Donna Edwards, Senator Bernie Sanders, thanks so much for your time tonight and for your passion on this issue.

“The Associated Press” reports with 17 percent of the vote in, David Prosser, the incumbent Republican, with 50 percent of the vote, JoAnne Kloppenburg with 50 percent of the vote.  That, of course, is the state Supreme Court race in Wisconsin.  It is a big one.  We‘ll follow it throughout this hour.

Remember to answer tonight‘s question: Who is to blame if the government shuts down?  Text “A” for Republicans, text “B” for Democrats to 622639.  We want to know what you think.

(BEGIN VIDEOTAPE)

SCHULTZ (voice-over):  Strategy of the shutdown.  You‘ve heard from the principals.  Next, the politics of the posturing with Katrina Vanden Heuvel.

Paul Ryan‘s budget plan for 2012.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN ®, WISCONSIN:  This is the path to prosperity.

(END VIDEO CLIP)

SCHULTZ:  For the rich and the super rich, I‘ll give you my take on this Republican dream come true and I‘ll explain how it could change your way of life.

And on to Wisconsin, where today, a judicial election has become a matter of national importance.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

SCHULTZ:  And we ask you to check out our new blog at Ed.MSNBC.com. 

There, you‘re going to find links to my radio Web site at WeGotEed.com. 

Sign up, Twitter and Facebook, we‘re all about having you part of the team.

Coming up: the Democrats say the GOP has once again moved the goal posts on the budget compromise.  Republicans won‘t agree on a proposal unless the Tea Party is onboard.

And the latest results in the Wisconsin Supreme Court race.  “The Associated Press” reports with 20 percent of the vote in, David Prosser, the incumbent Republican, with 51 percent of the vote; JoAnne Kloppenburg with 49 percent.

We‘re right back.  Stay with us.

(COMMERCIAL BREAK)

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

We continue to follow that Wisconsin state Supreme Court race.  “The Associated Press” reporting now, with 23 percent of the vote being reported, David Prosser, the incumbent Republican, with 50 percent; JoAnne Kloppenburg, the challenger, at 50 percent.  It looks like it‘s going down to the wire.  We‘ll keep you up to date.

And with the government shutdown approaching, Democrats say the GOP is moving the goal post.  Speaker Boehner is signaling that the GOP will not back a budget agreement unless all 218 Republicans are onboard.

But that was not originally the case.  The Republican leadership previously seemed willing to reach out and do a deal that got support from both parties, even if they lost some far right wingers in the process.  Well, the latest move proves that Boehner wants to win the Tea Party votes even if they are not needed for passage and even though the Tea Party wants the shutdown.

Sixty-two percent of the Tea Party supporters say a government shutdown would be a good thing.  Needless to say, Senate Majority Leader Harry Reid says he‘s not optimistic on the Republicans‘ ability to compromise.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER:  They‘re not trying to arrive at the finish line.  It appears that they are going to do everything they can to satisfy the Tea Party.  There‘s only so much that we can do.  We have bent over backwards to try to be fair and reasonable.

(END VIDEO CLIP)

SCHULTZ:  Joining me now is editor and publisher of “The Nation,” Katrina Vanden Heuvel.

Good to have you with us tonight, Katrina.

KATRINA VANDEN HEUVEL, THE NATION:  Thank you.

SCHULTZ:  This is a barn burner politically.  Who wins, who loses? 

How do you call it at this hour?

VANDEN HEUVEL:  Well, I think at the moment, Boehner looks like he‘s an appeaser.  He‘s trying to appease the Tea Party and the extremist right wing of the Republican Party.

I think President Obama in his press conference, came out looking fair and reasonable.  He must have used that word 16 times.  He looks like the adult in chief.

And you‘ve got these people in the Tea Party and the sand box trying to score political points.

Well, you got an economic recovery, very slow, but moving.  And you‘ve got—if you get a government shutdown, it shows what the Tea Party and the extremist Republicans will do in service to a cynical and hateful view of government.

SCHULTZ:  Katrina, why won‘t John Boehner say, you know, $60 million, $40 million, $40 billion is good enough, we‘ll get the rest later?  Why won‘t he—why won‘t he turn to the Tea Party and say, it‘s time to take the deal because we could hurt a lot of people?

VANDEN HEUVEL:  Well, you saw today the real opening salvo in the big debate this country needs to have about two fundamental views about what kind of nation we will be and that was Representative Paul Ryan of the budget committee and the House.  And he basically wants to eviscerate government.  He talks about balancing the budget, but what he wants to do is balance a budget on the backs of those who have the least, who can sacrifice the least.

And Boehner is both a hostage to the Tea Party and I would argue a hostage to Paul Ryan, who is trying to be the leader of a party which Boehner ostensibly claims to lead.  And he is caught in the middle.  This man, John Boehner, is caught in the middle and American people will suffer on all fronts for that.

SCHULTZ:  And the president talked today about the country taking a hair cut.  Here it is.

(BEGIN VIDEO CLIP)\

OBAMA:  So, this notion that somehow we‘re offering smoke and mirrors, try telling that to the Democrats out there because part of what we‘ve done is we‘ve been willing to cut programs that we care deeply about, that are really important.  But we recognize that given the fiscal situation that we‘re in everybody‘s got to make some sacrifices.  Everybody has got to take a hair cut.

(END VIDEO CLIP)

SCHULTZ:  Some call it a scalping.  That‘s what I‘d call it—scalping instead of a hair cut.

Now, politically, are the Democrats in danger with their base?  Because the president right there admitted, you know, we‘ve made some pretty tough cuts—cuts in programs that Democrats really care about.

VANDEN HEUVEL:  Yes.  I think in a way the president is going to come out as the adult in chief.  On the other hand, because the president hasn‘t fought harder, he‘s been in a way kind of shrinking and invisible president in these debates, he hasn‘t reset the terms of the debate.

Ed, we do not have a budget deficit crisis.  We are a wealthy country. 

You had on Senator Sanders earlier.

Where are the alternative streams of revenue that could avoid the cuts to the Pell grants, to the programs in this country that help the middle class and the working people of this country?  They have been off the table because this administration has not fought harder.  The $33 billion looks smarter but we shouldn‘t be at this number.  We are caught between an extremist Republican Party and a White House which needs to fight harder.  Courage of conviction.

I think Paul Ryan‘s politics are despicable.  I think the media for calling him tough, brave, and ambitious, ignored the fact that this is a man who threw his support for Bush tax cuts, gave us a deficit that shouldn‘t be one we have.  But at the same time, the Democratic Party, the president needs to have the courage of their convictions to tell people we want a government not on your back, but on your side.

SCHULTZ:  A contentious caucus meeting today for the Democrats and they come out saying we‘re going on the offensive.  What does that mean to you?

VANDEN HEUVEL:  Well, it should mean that there are more things on the table so we don‘t have these kinds of cuts to those who have not contributed to the terrible economic crisis this country has gone through.  We need a different kind of economic frame work.  We need one of short-term great investment and rebuilding this country, a different kind of social contract, and not all this talk about crisis.

But we need leadership from the White House.  I understand the systemic obstacles this president faces.

SCHULTZ:  How did he do today?

VANDEN HEUVEL:  Today, as I said he came out.  He looked reasonable.  He looked like he was interested in the people‘s business.  He spoke of the need for government to be on the side of economic recovery.

But, Ed, you can look good because of the barrenness of the landscape around you, look, you got these Republicans.  Look at what is going on in our country.  We can do better and the president is a reasonable man.

SCHULTZ:  Katrina Vanden Heuvel, great to have you with us tonight.

VANDEN HEUVEL:  Thank you.

SCHULTZ:  Thanks so much for joining us.

“The Associated Press” reporting now with 24 percent of the vote in, David Prosser the incumbent Republican, with 51 percent of the vote.  JoAnne Kloppenburg with 49 percent of the vote.

Coming up: he is the wonder boy of the Republican Party.  Conservatives are calling him courageous and bold.  We‘ll tell you why Paul Ryan‘s budget is a millionaire‘s best friend and why it‘s going to break the back—and I mean break the back of the middle class.

That‘s next.  Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. PAUL RYAN ®, WISCONSIN:  We need to be honest with the American people about the problems we face.  We need a fact-based budget, no more accounting tricks, no more budget gimmicks.  And that is what we are offering the American people.

(END VIDEO CLIP)

SCHULTZ:  You bet.  No worse off budget or any stuff like that.

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

The Ryan budget—you know what?  It‘s the blueprint the Republicans have been working towards for over a decade.  It‘s finally on paper and it is exactly what they want.  It‘s a government in a bath tub—budget cuts we have never seen before and cuts that will affect millions of Americans.

I think every American is going to be touched by this budget cut if it were to ever go through.  And respectfully, Mr. President, this is more than a hair cut.  This is a brutal scalping.  Ryan and the Republicans want a 10 percent tax cut for the wealthiest Americans, from 35 percent down to 25 percent.  Now, hold it right there. 

When we were in the lame duck session of the Congress and they wanted to extend the Bush tax cuts, I told you there was more coming, folks.  It‘s an I told you so moment.  I told you that the Republicans were ruthless.  They weren‘t going to back down or stop at the Bush tax cuts, that they wanted more. 

Now it‘s on paper.  Now they want to reduce the corporate tax rate even for those who don‘t pay any tax, and now they want to reduce the personal income tax rate for the wealthy in this country from 35 down to 25 percent. 

Well, they‘re going to pay for it by cutting nearly 400 billion dollars from Medicare over ten years.  In the same time frame, they‘re going to defund Medicaid by 735 billion dollars.  And they‘ll cut discretionary domestic spending by 923 billion dollars. 

These are beyond Iraq numbers.  Now we‘re talking about got to keep the country safe, Homeland Security.  FEMA—hey, Fargo, you worried about a flood?  You‘re not going to get any federal money.  EP—EP—the Environmental Protection Agency?  Man, the Kochs have been after that for a long time.  They might get it. 

Social Security Administration, see you got to go after the front office so you can really start taking it down and privatizing it.  Pell Grants for students—what did the students do wrong?  Hell, they got born in the wrong place.  That‘s the way the Republicans are shaping this thing up. 

I mean, they‘re all on the chopping block in order for the richest Americans out there to get a nice fat tax cut.  Why?  Well, hell, they might create more jobs.  Under Obama you believe that? 

The big targets, of course, of this budget are Medicare and Medicaid. 

The Republicans want vouchers for Medicare and block grants for Medicaid.  They want to throw seniors into the private insurance industry like raw meat.  And they call that premium support? 

No, no, no, no.  That would be premium destruction.  And guess what?  Another Wall Street rip off.  And they want Medicaid to be classified as a welfare program, even though almost 90 percent of Medicaid beneficiaries are children, the elderly and the disabled. 

More on that later. 

Paul Ryan says his budget will reduce spending six trillion dollars in ten years.  Now think about this: this is after the United States of America has spent over a trillion dollars in Iraq in the past eight years. 

This is more than a hair cut.  Ryan wants to be the fiscal conservative poster boy from ironically Wisconsin.  And yet his entire budget is based on a tax cut for the rich, paid for by the middle class and the poor. 

I cannot believe that this is where America wants to go.  It‘s a fight that we got to look forward to, because liberals, we are on the correct side of the issue here.  We‘re better than this. 

But this is the budget that they have wanted for more than a decade.  This is what they wanted when Bush was in, but of course they couldn‘t deliver the mail because some Democrats showed up strong against it.  Democrats need to show up strong this time around. 

The Associated Press now reporting at this hour 32 percent of the vote in in Wisconsin, as we continue to follow Wisconsin State Supreme Court vote.  David Prosser, the incumbent Republican with 50 percent, Joann Kloppenberg with 50 percent. 

John Nichols is at the Kloppenberg headquarters for the latest.  John, it‘s heavy turnout tonight, no doubt about it.  The numbers very tight at 50/50 have been in that neighborhood all evening.  John, what is the game changer here?  Where could this election turn as the numbers continue to roll in? 

JOHN NICHOLS, “THE NATION”:  Well, Ed, you take a look at the map of Wisconsin.  There are three Democratic heartlands, if you will, that are still almost completely out.  That‘s La Crosse County, out on the Mississippi river.  That‘s most of Dane County.  Roughly 80 percent of Dane County has not reported yet.  That includes the city of Madison. 

And that‘s Milwaukee County.  Still, the overwhelming majority of Milwaukee county not reporting.  Now, when they come in, you‘re going to see a major bump in the Kloppenberg vote.  There are also some suburban Milwaukee counties that lean to a more conservative bend.  When they come in, you should see some votes for Prosser. 

My bet is this night is going to stay close.  But I will tell you, Ed, that those dramatically high turnouts in Dane County suggest that Kloppenberg has an immense number of votes still coming her way.  If this stays 50/50, until those Madison and Dane County votes come in, you may well be looking at a change in this Supreme Court seat. 

SCHULTZ:  A lot of out of state money on both sides coming into the state and a lot of grass roots work done from folks who don‘t live in Wisconsin.  How has that been received by Wisconsinites? 

Obviously it‘s having an effect.  There‘s been a record turnout, or not a record turnout but a big turnout. 

NICHOLS:  Oh, yes.  Well, Ed, it will be a record turnout for this sort of race.  And we could have as many as 1.5 million people voting. 

SCHULTZ:  Wow. 

NICHOLS:  And that compares to under a million often in past Supreme

Court races.  So a big, big bump.  Now the outside spending is in the range

when it‘s all added up, probably going to be something around six to seven million dollars, unprecedented.  So, yeah, it did have an impact.  There‘s No doubt. 

SCHULTZ:  John Nichols, Washington correspondent of “The Nation,” stay with us.  We have a lot more coming up to the top of the hour, as we will continue to cover that hot race in Wisconsin. 

Up next, we‘ll tell you exactly why Paul Ryan‘s budget could lead to shorter lives for working class people.  Tax expert David Cay Johnston and steel workers union president Leo Girard, they will be here to weigh in on the budget the Republicans have put out.  We‘re right back.  Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GLENN BECK, FOX NEWS ANCHOR:  Paul Ryan, you, sir—you, sir—

RYAN:  How you doing?

BECK:  I love you. 

RYAN:  Oh, I love you, too. 

(END VIDEO CLIP)

SCHULTZ:  Just a love fest today between conservatives and Paul Ryan.  David Brooks of the “New York Times” called Ryan‘s budget courageous.  The “National Review” said it‘s the boldest budget plan ever offered.  House Speaker John Boehner said it was a budget worthy of the American people. 

I wonder if they consider Medicaid recipients to be worthy Americans.  In a “Wall Street Journal” op-ed today Ryan classified his cuts to Medicaid as welfare reform.  In other words, all those greedy welfare queens have taken advantage of Medicaid for just too long and it‘s time to reform it. 

But if you take a look at recent distribution of Medicaid dollars, you‘ll see a totally different story.  Of the 58 million Medicaid recipients of 2007, nearly half of them were children.  Of the 300 billion dollars in Medicaid benefits, the vast majority went to the elderly and the disabled. 

You would think it would be a bed rock of civil society to protect the elderly and disabled.  But Ryan‘s budget considers them, well, welfare leeches.  And it‘s not just Medicaid. 

It‘s Medicare as well.  And it‘s a tax cut for the rich that would basically be a massive tax increase on the middle class. 

Joining me to talk about this tonight, the Ryan budget, the two men who understand just how devastating this proposal will be for working class Americans, David Cay Johnston, who is a columnist for Tax.com and a former tax columnist for the “New York Times,” and Leo Girard, president of the United Steel Workers International. 

Gentlemen, thanks for your time tonight.  David Cay, we‘ll start with you first.  Just how devastating would this be to the elderly, to the disabled, and the children? 

DAVID CAY JOHNSTON, TAX.COM:  Well, this is a plan that basically says unless you‘re well to do, if you get sick, then you‘re going to die sooner.  And let me illustrate something.  This plan for vouchers and to take care of insurance companies would have funneled funding go like this  while costs go like this.

And this space in between if you‘re well to do, you pay it out of your own pocket.  So you still pay the same costs.  You just don‘t pay it through taxes.  And if you‘re not well to do, and you get sick, well, you‘re not going to have the care that you need, and you‘re just not going to live as long. 

SCHULTZ:  Mr. Girard, what does this mean to working family‘s discretionary spending and their future? 

LEO GIRARD, UNITED STEELWORKERS INTERNATIONAL:  This is a devastating budget, Ed.  You know, that comment that the mark of a great nation is not what it does for its most wealthy and most powerful but what it does for its most vulnerable.  And what this budget will do is attack working families, drive their costs up, take money out of their pocket, which will take away spending power.

And it will add to the deficit five trillion dollars over the life of the budget.  And it is going to cost, again, hundreds of thousands of jobs. 

Let me again remind you and the viewers, this is the result of tax cuts for the wealthy that have been going on for a decade.  If tax cuts for the wealthy created jobs, as they‘ve been saying, we‘d have full employment.  We‘ve given out almost two trillion dollars of tax cuts since the Bush administration and the extension of tax cuts. 

We‘ve got corporate taxes—and David can make a comment to this.  We‘ve got corporate taxes and personal taxes lower than any time since 1950.  You can‘t run a modern economy if you‘re not going to find a way to pay for it and have the most wealthy get another free ride.  As I said in a recent comment I made, they‘re free loaders. 

SCHULTZ:  David Cay Johnston, your response to that?  You agree with that?

JOHNSTON:  Leo is quite right about this.  This is a proposal that the highest tax rate would be about 25,000 -- 25 percent.  People in five figure incomes, people making 75,000 dollars if they‘re single, would be paying the same rate as people who are making millions and millions of dollars a year. 

And they‘re not doing anything about the huge subsidies to oil and gas.  Why do we need to subsidize oil and gas?  Everybody wants and needs it.  To the timber companies, to the aluminum companies, to all of these other companies that are funding people like Mr. Ryan. 

And I think the question we should be asking is why are we focused on this plan?  Where is the president‘s plan?  Where is the Democrats‘ plan to address these issues of long term economic stability and balanced budgets? 

We need to balance budgets.  But there are lots of ways to do it other than on the backs of the poor, the disabled, and children, who have no power to improve their circumstances. 

GIRARD:  Ed, the biggest—

SCHULTZ:  What is the Democrats‘ next move, Mr Girard? 

GIRARD:  The biggest crisis that we have in America is a jobs crisis.  The biggest crisis we have in America is the de-industrialization of the country.  We‘ve lost 58,000 factories.  We‘ve got to have a plan to put people back to work.

And when we put people back to work, people will be able to contribute to the process of revitalizing the country.  And we‘ve got to do what Senator Sanders said.  We have to demand shared sacrifice. 

SCHULTZ:  The Republicans are saying tonight that this will create jobs, that this will—this will create productivity. 

GIRARD:  I think they‘ve been smoking something in the back room, Ed.  The reality is that—again, they keep singing the same song from the same song book.  If tax cuts created jobs, with what Bush did for eight years and what we just did last December, we‘d have full employment. 

Tax cuts for the rich, tax cuts for corporations don‘t create jobs. 

Putting revenue to job creation creates jobs. 

SCHULTZ:  Leo Girard, David Cay Johnston, good to have you with us tonight.  Thanks so much. 

GIRARD:  Thank you. 

SCHULTZ:  The Associated Press reporting at this hour, with 38 percent of the vote, David Prosser the incumbent now at 52 percent and Joann Kloppenberg with 48 percent of the vote.  The voters were out in force today. 

John Nichols of “The Nation” is next.  For the latest update, stay with us.  Lots more coming up.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  Your campaign is quoted as saying that you, if

re-elected, look forward to acting as a common sense complement to both the

new Walker administration and the legislature.  What does that mean? 

DAVID PROSSER, WISCONSINS SUPREME COURT JUSTICE:  Well, that particular statement was issued.  I never saw that statement. 

(END VIDEO CLIP)

SCHULTZ:  That was Wisconsin Republican Supreme Court Justice David Prosser back in January.  His re-election campaign was billing him as a rubber stamp for Scott Walker.  Tonight, as the news continues to roll in from Wisconsin, with 42 percent of the vote in, the man you just saw on that tape, Republican David Prosser, is ahead of challenger Joann Kloppenberg 51 to 49 percent. 

Make no mistake, this election is a referendum on Governor Scott Walker‘s radical agenda to end collective bargaining rights for middle class in that state. 

The polls closed in Wisconsin at 8:00 p.m. Central Standard Time tonight.  Reports are that the turnout was record.  In Appleton, in Green Bay, Madison, and elsewhere, outside groups were aware of the consequences and the special interest money just poured into the state. 

On the left, Greater Wisconsin Committee spent over a million to elect the Democrat Joann Kloppenberg.  Right wing groups raised well over two million dollars for Judge Prosser.  If he‘s defeated, conservatives will lose their four to three majority on the court.

Remember, Prosser isn‘t just a judge.  He‘s a former Republican speaker of the Wisconsin Assembly, the same body that pumped out Walker‘s union busting bill.  This is a partisan guy, no doubt about it.

One of the groups that has raised the most money for Prosser is Citizens for a Strong America.  They put down 800 grand to make sure Walker‘s union busting agenda gets through the courts.

Think Progress did a little digging on Citizens for a Strong America.  Turns out the group has close ties to Americans for Prosperity, the front group of the billionaire Koch Brothers.

Sarah Palin knows how big this election is tonight.  Last week, she Tweeted her endorsement of Judge Prosser.  And then there‘s the man of the hour, Congressman Paul Ryan.  Today, Glenn Beck asked him for a prediction on the big election in Wisconsin.  Guess which candidate he likes.

(BEGIN VIDEO CLIP)  

BECK:  Election today, huge in Wisconsin. 

RYAN:  Yes. 

BECK:  What do you think is going to happen? 

RYAN:  It‘s going to be tight.  Dave Prosser is a friend of mine.  He‘s a great judge, proven conservative.  But the unions have really mobilized. 

(END VIDEO CLIP)

SCHULTZ:  Actually the people have mobilized.  And they are mobilized tonight inside the Kloppenberg headquarters, where John Nichols of “The Nation” joins us this evening. 

John, what is the latest?  This turnout has got to be really encouraging as a push back, I would think, of the union busting bill.  This is really something to watch tonight. 

NICHOLS:  It really is, Ed.  I think people should be conscious of the fact that six weeks ago, no one in Wisconsin knew who Joann Kloppenberg was.  She is an assistant attorney general, very experienced, but somebody who has never run for public office before.  She is challenging a 30-year career politician who has run statewide, who served as the speaker of the state assembly, the Republican majority leader.

It‘s simply incredible that this race is so close.  I will remind folks that at this point, only one precinct in the city of Madison, which is a—seen as really one of the core bases for Kloppenberg has counted yet, has reported yet. 

That is significant.  Back in 1998, when Russ Feingold was running for reelection, he lost statewide—or it looked like he lost.  And then Dane County came it, particularly Madison, and provided him with such a boost of votes that he actually won that election.  A lot of Kloppenberg people are looking at that. 

SCHULTZ:  John Nichols, we ask you to stay right there.  You‘re doing yeoman‘s work.  We‘ll talk about the legal ramifications of tonight‘s election and the latest on the recall efforts, next.  Stay with us.

(COMMERCIAL BREAK)

SCHULTZ:  Thank you for staying with us tonight.  We continue to follow the breaking news out of Wisconsin.  Now with 46 percent of the vote being recorded, according to the AP, Judge David Prosser is ahead of challenger Joann Kloppenberg 52 to 48 percent.  Some 30,000 votes—that‘s the difference at this moment. 

But there are major Democratic strongholds yet to be counted.  We‘re back with John Nichols, Washington correspondent of “The Nation.”

John, the legal ramifications of this turnout tonight are huge when it comes to collective bargaining.  If the Supreme Court justice retains his seat, how big a victory is this for Governor Walker? 

NICHOLS:  Ed, I think we have to be honest with ourselves.  It is a significant victory for Governor Walker.  You know, in reality, the fact that Joann Kloppenberg came from nowhere to make it essentially a tied race now and one that she could still win is a real story. 

But that‘s an inside politics story.  The outside story, the one that Governor Walker will certainly want to communicate, if Prosser wins, is that, you know, in this referendum on him, he‘s narrowly won.  And so, yeah, this is high stakes politics, Ed.  It‘s as good as it gets for those of us who cover politics for a living. 

SCHULTZ:  No doubt.  And what effect do you think this election tonight, if it goes either way, would have on the recall effort? 

NICHOLS:  Well, it‘s very, very significant.  Look, the recall efforts are going to go ahead.  The fact is one recall for state senator has already been filed.  There will be more filed in the coming weeks.  My anticipation is we‘ll see one recall filed about every four or five days over the next month. 

So the recall will happen no matter what.  But the fact of the matter is if Joann Kloppenberg wins, that will be a significant energy boost for the recall efforts.  Remember, the recall petitioners have been at the polling places today gathering signatures.  And I can tell you, for instance, in the Milwaukee Area, Alberta Darling‘s district, they‘ve been signing up a lot of recall petitioners. 

SCHULTZ:  Well, John, we‘re told that there are some Democratic strongholds that have not been accounted for as of yet.  So let me take it a step further, which I‘m sure our audience may be exhausted with, but I think it is a very important point.  We know how the Republicans and the Koch Brothers operate. 

What if Kloppenberg wins this race tonight?  What are the recount laws in Wisconsin?  What would trigger a recount?  What are the legal guidelines here? 

NICHOLS:  Sure.  Well, if you get—if you‘re under one percent, roughly in the range of a half percent difference, there is an automatic recall.  And you could of course get—or I‘m sorry, recount.  You can also have a recount at your behest if you are willing to pay for it. 

So certainly if the Koch Brothers thought this was close enough, they could pay for a recount.  But the reality is that Wisconsin has very, very good voting systems.  And the fact is that if one of these candidates wins by 5,000, 6,000, 7,000 votes, that‘s going to be a clear victory or at least clear enough that it is likely to hold. 

We don‘t have the glitches a lot of states do, at least most times. 

SCHULTZ:  OK. 

NICHOLS:  I think we‘ll get a result.  It just may be late tonight. 

SCHULTZ:  John Nichols, we‘ll visit tomorrow.  Appreciate your work. 

Thanks so much for helping us out tonight. 

NICHOLS:  Appreciate it. 

SCHULTZ:  Tonight in our survey I asked, who is to blame if the government shuts down?  Eighty three percent of you say the Republicans‘ 17 percent say the Democrats.

That‘s THE ED SHOW.  I‘m Ed Schultz.  For more information on our program, we‘d like to take you to our new blog at Ed.MSNBC.com. 

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