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Msnbc Live at 6 p.m. ET, Monday June 13, 2011

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Guests: Dana Milbank, Jennifer Donahue, Ernie Istook, Wayne Slater, Joshua Trevino, Robert Borosage, Michelle Cottle, Simon Rosenberg, Robert Reich

CENK UYGUR, HOST:  They all say they can beat President Obama, but first, will they knock each other senseless? 

Tonight, the Republicans race heats up big-time.  It‘s one of the hottest nights yet. 

And then, Texas Titan.  Is Rick Perry the real deal?  Will his religious rip (ph) catch fire with GOP voters if he gets in the race? 

And Democratic wise man Bruce Babbitt says Obama has got to start fighting now. 

Wow.   Even Bruce Babbitt is calling him out.  We‘ll find if the White House is listening.

And Republicans used to talk about jobs, jobs, jobs.  So how come now all they do is talk about cuts, cuts, cuts?  Robert Reich on the GOP strange plan to not fix the economy. 

Good evening.  I‘m Cenk Uygur. 

Mitt Romney makes an ad; Tim Pawlenty launches an attack; and Newt Gingrich reboots.  When Republicans attack—that‘s our lead story tonight. 

Several Republican will debate this evening in New Hampshire.  This is the first debate to include the best-known candidates like Romney, Gingrich and Michele Bachmann.  So now we‘re having fun. 

The top question: How much will they attack Romney?  He is the clear front-runner.  So will they try to rip his face off during that debate? 

Tim Pawlenty seems to be itching for a fight, unveiling a new line of attack on Romney‘s one real achievement as governor.  That‘s, of course, health care. 

(BEGIN VIDEO CLIP)

TIM PAWLENTY ®, PRESIDENTIAL CANDIDATE:  President Obama said that he designed Obamacare after Romneycare.  And basically made it Obamneycare.  What I don‘t understand is they both continue to defend it. 

(END VIDEO CLIP)

UYGUR:  Our second question: How will Newt Gingrich try to relaunch his campaign?  Last week, he essentially got fired by his own staff, but he says he will push on. 

Tonight, we‘ll also see if Tim Pawlenty will surprise us or slide into irrelevance. 

And perhaps the most interesting question: Will Michele Bachmann emerge as the big star tonight? 

All right.  Joining me now from New Hampshire, where he is covering the debate, is Dana Milbank, the national political reporter for “The Washington Post.”  “Huffington Post” contributor Jennifer Donahue, who spent years covering the primary politics in New Hampshire, also joins us.  And we‘ve also got former Republican congressman Ernie Istook.  He‘s of course with The Heritage Foundation now. 

Thank you all for coming.

Dana, let me start with you. 

How hard are they going after Romney given his huge lead in the polls right now? 

DANA MILBANK, NATIONAL POLITICAL REPORTER, “THE WASHINGTON POST”: 

Well, look, I mean, I think the first thing you need to set aside is that Herman Cain wins the debate no matter what happens.  And then you‘ve got to, you know, who is most interesting after that?  Which will probably be Michele Bachmann. 

They do all go after Romney, probably not in that overt way.  You already had Pawlenty today saying he doesn‘t want to repeat that “Obamneycare” line, as if that were the most horrible thing you could say in the world. 

So, I think they‘re going to be careful not to take it into a bitter, personal tone.  But that‘s the mark that they are all looking at tonight, is how can they do well vis-a-vis Romney? 

UYGUR:  So, Jennifer, how does a guy like Pawlenty stand out when he‘s already got the rap for being incredibly boring?  I think deservedly so.  If he doesn‘t attack the other guys, how in the world is he going to stand out?  How did you thread that needle? 

JENNIFER DONAHUE, “THE HUFFINGTON POST”:  You know, to thread that needle, he has got to show that there is a reason to elect him over the others.  But I sort of disagree that Romney is the front-runner at this point. 

I think Romney is basically the head of a wide open field, and there is going to emerge tonight an alternative to Romney who will be probably a movement conservative.  But I don‘t think they will do it by being negative. 

I think the candidates will heed Ronald Reagan‘s 11th commandment saying thou shalt not speak ill of another Republican.  I think they have to be careful to introduce themselves to voters tonight, but not to dirty the floor too badly too soon.

UYGUR:  Well, Ernie, let me ask you about that, because I‘m going to show you two things here.  One is a poll. 

ERNIE ISTOOK, THE HERITAGE FOUNDATION:  Sure. 

UYGUR:  It‘s got Mitt Romney at 24 percent.  Second, is Palin, who‘s not even running, at 16 percent.  Herman Cain is third.  I mean, wow! 

Look at Pawlenty and Santorum down there.  Michele Bachmann is all the way on the second list.  She didn‘t even make that list. 

And then, here‘s another interesting poll, “What GOP voters want from a nominee.”  Only 24 percent say agree with you on the issues, 75 percent say they can beat Barack Obama. 

All that seems to point towards Mitt Romney, doesn‘t it? 

ISTOOK:  Well, remember that, tonight, this is not about winning the race.  This is like Olympic track and fields, where you have the qualifying heats that are run first.  People are just competing to be in that first echelon. 

They don‘t have to finish first.  They might finish second.  They might finish third.  They might be in fourth place.  But they have to get themselves up in the top tier of candidates, and that means they go after Barack Obama.

And voters will decide gradually which of them they believe can defeat Barack Obama after they have enough exposure to them.  I don‘t think that‘s going to be the issue in this first tier, in this qualifying round, if you will. 

UYGUR:  So, you know, Dana, let me go back to the point you made.  You said—you mentioned Bachmann, you mentioned Cain.  Those are good points.  Look how well Cain is doing in—I would say only about—based on a different poll, only about a third of the voters even know him and he is in third place. 

So, in debates like this, are they structured to help people like Bachmann and Cain stand out because they all have the most fiery answers, you would imagine? 

MILBANK:  Yes, it certainly helps the most flamboyant among them, which weighs in favor of those particular candidates. 

Look, you see people coming in to watch, or at least to stand outside the debate tonight, with Romney “RINO” signs, Republican in Name Only.  I would venture to say that the anti-Romney level is much higher here than the pro-Romney level. 

The problem is—for the other candidates—is that it is divided among so many of them.  You know, who emerges?  And I think Congressman Istook‘s idea of this sort of trial heat is useful, except you have the same candidates.

Nobody gets knocked out in this thing.  They keep coming back over and over again.  And if each of these—you know, if Bachmann can grab a few, if Cain can grab a few, Pawlenty can, Santorum can grab a couple of asterisks here and there, the problem is nobody emerges as that central contender to take on Romney, and he gets it by default. 

UYGUR:  Well, Jennifer, I want to talk about that.  I mean, if Santorum doesn‘t stand out, if Pawlenty doesn‘t stand out, at some point do you say,  well, these guys are at five percent and they‘re never going to stand out?  I mean, when do you call it for them? 

DONAHUE:  Well, I think Iowa will have a significant impact on New Hampshire, too.  If Pawlenty does well, or Bachmann does well in Iowa, that gives them a bounce into New Hampshire.  So you have to watch that dynamic, too. 

But I don‘t think this field is finished.  I think Rick Perry may get in.  I don‘t really think Sarah Palin will get in. 

But Republicans that I talk to in New Hampshire, especially conservative movement Republicans, are all over the place.  They want a winner.  They don‘t want to vote for someone or support someone or endorse someone that they don‘t think can beat Obama.

And Obama is the man with the target on his head, not Romney.  So, the key is that Republicans are split.  It‘s a totally unified Republican base in New Hampshire.  And it it‘s anybody‘s to lose.  It‘s not Romney‘s to lose at this point. 

UYGUR:  That‘s interesting.  I don‘t know.  If I was the Republican strategist, I would tell them, hey, you have got to go after Romney.  Who cares about Obama?  We‘re never going to get to Obama if we don‘t go through Romney? 

DONAHUE:  You would?  See, I don‘t think so.  I think you have got to hit Obama to show you‘re the one who can beat Obama. 

UYGUR:  I know, but they all hit Obama.  That doesn‘t help you stand out.  They all can‘t stand Obama.  We all already know that.

Look, Ernie, you‘re the Republican here.  So, tell me, I mean, who is the real social conservative here and who is the real Tea Party candidate?  Who is the one who can actually challenge Romney? 

ISTOOK:  Well, they are competing for different aspects. 

Tim Pawlenty may be most interesting because he is both trying to appeal to the so-called establishment Republican camp so that he can compete with Romney against them.  And he realizes that he is at a disadvantage against Herman Cain and Michele Bachmann when it comes to the Tea Party movement. 

He wants to have a foot in both camps.  So it means he may have to be a little bit of a contortionist trying to show that he can play both sides there. 

But I think it‘s going to be especially interesting, because I think Michele Bachmann is going to try to prove to people tonight that she is not just somebody that can give the populist Tea Party rhetoric, but that she can be a very important, thoughtful voice on issues as well.  A lot of people underestimate Michele Bachmann in that way. 

UYGUR:  Yes.  Well, look, you know me.  I‘m one of those people that are underestimating her.  I don‘t mean politically.

ISTOOK:  Well, I know.  You‘re not caring for any of them, Cenk.  I know that. 

UYGUR:  No, I know.  And look, I don‘t mean politically, by the way. 

I mean, does she have a better shot in Iowa?  She might.  I‘m not underestimating her in that sense.  As an intellectual, that‘s a stretch, if you ask me. 

And you mentioned Pawlenty.  I‘ve got to play you a clip, because you mentioned he is trying to be a contortionist here. 

Great example, he was on Fox News.  Chris Wallace asked him some tough questions.  Take a look at this. 

(BEGIN VIDEO CLIP)

CHRIS WALLACE, HOST, “FOX NEWS SUNDAY”:  When have we ever had 10 consecutive years of five percent growth as you project in your plan? 

PAWLENTY:  Well, this is an aspiration, it‘s a big goal, and it‘s a stretch goal.

WALLACE:  Is it declinist to doubt the five percent number or is it just a realist? 

PAWLENTY:  But Chris, as I said, even if—and this is an aspirational goal. 

(END VIDEO CLIP)

UYGUR:  Dana, isn‘t that basically admitting, my budget is full of it, I don‘t really think it‘s going to happen, it‘s aspirational?  And on those tax cuts, God, I don‘t know if people are talking about that enough.  In Pawlenty‘s plan, they are gigantic.  They put a $7.8 trillion hole in the budget. 

What kind of conservative is that? 

MILBANK:  I mean, the poor guy.  You say a contortionist.  If he does any more of this, he‘s going to need his knees and his hips replaced before this whole thing is over. 

And I think it‘s tragic in a way, because he could have been, or he still could be, a very viable candidate against President Obama.  What he is doing is tossing away many of his best attributes.  And that is he did have a lot of crossover appeal.  He was sort of this thoughtful, innovative Republican voice from a very blue state. 

Now he is trying to out-conservative everyone else in this race.  And, of course, that is sort of a fool‘s errand, because you have got down-the-line conservatives in this race. 

UYGUR:  You know, one guy we haven‘t even mentioned is Newt Gingrich. 

Perhaps that goes to show how irrelevant he has become lately. 

So, real quick for all of you guys—Ernie, who is more relevant, Newt Gingrich or Herman Cain? 

ISTOOK:  Well, right now, considering who is on the upswing and who is on the downswing, Herman Cain may be considered more relevant.  But I think Newt has had an image for a great many years as being an outside-the-box innovative thinker, and that medal is up for grabs. 

And I think people are going to want to illustrate to the Republican voters that they have the ability to be more innovative.  So some people are going to be trying to do that. 

And going back to what was mentioned about Pawlenty‘s plan about projections of economic growth, that may be a stretch to aspire to that level of growth, but if you look at President Obama‘s budget proposals, he makes that same kind of projection, those pie in the sky numbers that he uses to try to make us think that we‘re a lot better off than we really are. 

UYGUR:  Ernie, they‘re nowhere near the tax cuts that Pawlenty is talking about. 

ISTOOK:  I‘m talking about the growth rate numbers. 

UYGUR:  All right.  OK.  All right.

ISTOOK:  The growth rate that he relies upon. 

UYGUR:  So, it‘s part of what‘s unrealistic.  And Obama is nowhere near five percent either.

But real quick, to that question again, Jennifer, Newt or Herman Cain? 

Who is more relevant at this point? 

DONAHUE:  I think Herman Cain is being underestimated.  He has got legs in New Hampshire.  Conservatives like him. 

I think Newt is dead.  I think he can pretty much exit the race now. 

And I think Pawlenty is not trusted by conservatives. 

I think you might see some support for Ron Paul come out tonight, because there are a lot of Libertarians in New Hampshire, Pat Buchanan-type Libertarian populists.  And Pat Buchanan won the primary in ‘96 over Dole, who will come out and support Ron Paul. 

So, it‘s still early, and you never really know who is going to get traction. 

UYGUR:  Dana, final word, Gingrich or Cain?

ISTOOK:  Ron Paul‘s people always show up. 

MILBANK:  Let me just tell you how past tense Newt Gingrich is.  His surrogates speaking for him after the debate tonight?  His two daughters and his paid spokesman.  So, he‘s now down to family members and staff are his remaining supporters. 

(CROSSTALK)

UYGUR:  I‘m surprised he has got a paid spokesman left.  So maybe that‘s an improvement. 

All right.  Dana Milbank, from “The Washington Post.”  Jennifer Donahue from “The Huffington Post.”  And former Republican congressman Ernie Istook from The Heritage Foundation.

Thank you all so much for joining us tonight. 

MILBANK:  Thanks, Cenk. 

UYGUR:  All right.  Now, more pictures emerge of Congressman Weiner. 

Oh, come on, man. 

How many did this guy send?  And, of course, calls for his resignation are growing. 

And President Obama is now on the record.  That‘s actually an NBC exclusive, and we‘ve got that ahead for you guys.

Plus, bad company.  President Obama has a dinner date with the richest Wall Street bankers.  What promises are being made? 

Progressives, you‘re going to want to hear this one. 

And “Mediscare” Republican style.  Paul Ryan and his crew say that costs are out of control, but the facts reveal a big con job.

(COMMERCIAL BREAK)

UYGUR:  Republicans are looking for a real challenger to Mitt Romney since many conservatives think he‘s too moderate and some consider him to be a slippery serial flip-flopper.  A fair charge. 

But right now, the GOP field is filled with leftovers.  There doesn‘t seem to be a national figure that inspires the base. 

But here comes Rick Perry, the governor of Texas, riding in on a social conservative base.  It looks like he is getting ready to jump into that fight.  Perry is spending a lot of time this week crisscrossing the country, making headlines on the national stage. 

He flew here to Los Angeles on Sunday, speaking at a religious rally and attacking President Obama on abortion. 

(BEGIN VIDEO CLIP)

GOV. RICK PERRY ®, TEXAS:  With the stroke of a pen, abortion essentially became a U.S. foreign export.  I‘m deeply disturbed at the prospect of experimentation that uses such tissue, turning the remains of unborn children into nothing more than raw material. 

(END VIDEO CLIP)

UYGUR:  Well, that‘s going to play well with the base.  And tomorrow night he heads to New York, where he is replacing Donald Trump as the top speaker at the big GOP dinner there.  And Saturday, he is the star of the Republican Leadership Conference in New Orleans. 

Some Republicans think Perry could be just what they need.  He‘s a southern governor, with solid popularity in his state, and great credentials with the religious right. 

Of course, he‘s also led his state into a $27 billion budget deficit.  He‘s talked about seceding from the union.  And perhaps, worst of all, he is a former Democrat. 

Back in 1988, he was Al Gore‘s campaign manager for Texas.  Oops. 

But that was many moons ago, before Perry decided it was better politics to move a billion miles to the political right.  I think this guy could be the one that really gives Romney a ride for his money though, so let‘s officially start the national conversation about Rick Perry. 

And to help me do that, I‘m going to bring in Wayne Slater, senior political writer for “The Dallas Morning News,” and Josh Trevino from the conservative Texas Public Policy Foundation. 

Welcome, both.

UNIDENTIFIED MALE:  Thank you.

UYGUR:  Josh, I‘m going to start with you. 

I take it you‘re a fan of Perry.  Is he the real deal in your mind? 

And if so, why? 

JOSHUA TREVINO, TEXAS PUBLIC POLICY FOUNDATION:  Rick Perry is definitely the real deal.  The moment he decides to enter the race, if he does, it is really a contest between him and Mitt Romney for the nomination. 

Rick Perry doesn‘t just bring social conservative credentials, as you said.  He also brings strong fiscal conservative credentials as well.  His job creation record in Texas has been unparalleled among the states and really is one of the few things that are propping up Obama‘s anemic job creation record right now. 

So, Rick Perry is really, for my money, the strongest possible contender. 

UYGUR:  All right.  You know, Josh, you know I disagree with the latter part of it, but I am doing information gathering. 

TREVINO:  Well, we can talk numbers if you want.  I mean, let‘s talk about Rick Perry‘s job creation—

(CROSSTALK)

TREVINO:  No, no, no.  Really, over half.  Over half.

UYGUR:  No, no, no.  I‘m being serious.

TREVINO:  Well, what numbers do you want?  In the last five years—

UYGUR:  No, I want to have Wayne address that.

Wayne, talk to me here, because you cover politics in Texas.  No, no. 

I‘m being serious. 

So, are the job numbers great for him?  How does the budget look for him?  How does he stand in that regard? 

WAYNE SLATER, SR. POLITICAL WRITER, “DALLAS MORNING NEWS”:  Well, look, Josh is right, the job numbers do look good.  If you look at Texas, whether you want to give Perry credit or not, certain aspects about Texas‘ tax structure, regulation—we don‘t pay very much for social programs.  You are at the bottom on health care.  We have more uninsured children than any other state.  Those are elements that make the budget work, but also create—it‘s a right to work state—that create a job, a business-friendly environment. 

At the same time, Rick Perry is new presiding over a legislative session that will balance the budget by cuts alone, $15 billion in cuts from the current budget.  A few smoke and mirrors, and basically going into the next biennium the way they have it now by not paying off some bills, leaving the next legislature with billions of dollars in bills. 

So, it‘s an economic record that certainly would be applauded by

Josh‘s group and other fiscal conservatives.  But it‘s not one that always

everybody in the state, especially if you‘re poor and disadvantaged, thinks is all that great. 

UYGUR:  Josh, first of all, is he getting in?  I mean, we‘re talking about his merits here.  It seems like he is making a lot of moves here.  It looks like he is coming. 

Is he coming? 

TREVINO:  Well, that‘s not for me to say.  It certainly does look like the signs are aligning in that direction.  Whether he does or not, you know, I suspect there is still some boxes to be checked.  But what is certain is that if he does come, he is going to be one of the top contenders, there‘s no question about that. 

UYGUR:  Well, you know, let‘s talk about God‘s plan, because these conservatives, Michele Bachmann, et cetera, they all seem to know what God is up to.  Rick Perry is similar, but it‘s an interesting quote here.  Let‘s show you that. 

(BEGIN VIDEO CLIP)

PERRY:  I think we are going through those difficult economic times for a purpose, and to bring us back to those biblical principles of, you know, you don‘t spend all the money.  You‘re not ask for pharaoh to give everything to everybody and to take care of folks, because at the end of the day, it‘s slavery. 

(END VIDEO CLIP)

UYGUR:  Wayne, that seems like a curious argument, that we are going through this economic times because of biblical reasons. 

Did God want us to go through the economic times?  Does that sell in Texas, and does it sell across the country? 

SLATER:  Well, yes, it sells in Texas.  And more importantly, it sells among the constituency that‘s most important in Iowa and South Carolina and in Florida, and the early nominating states. 

Let me tell you, these Christian conservative voters, and Tea Party voters—and there is an overlap.  They are not the same people, but there is an overlap among those constituencies—are going to crucial in this presidential race.  You talk like that, good God talk, good religious talk, good strong appeals to social and religious conservatives in those states and in Texas, and you do well. 

UYGUR:  All right. 

Josh, how about working for Al Gore?  That‘s got to hurt him, doesn‘t it?  And what happened to Rick Perry?  How does a guy going from working for Al Gore to being this massive right-winger?  And do you trust him in that transition? 

TREVINO:  Absolutely.  No question about it. 

Look, Texas, like many southern states, has a long tradition, a tradition that is sadly dying out of conservative Democrats.  Al Gore used to be one back in the day.  It‘s hard to remember, but he was.  Rick Perry was one as well. 

And then, when the Democratic Party moved nationally, Rick Perry was like many, many, many southern Democrats.  Because of his conservatism, was forced to become a Republican. 

Absolute trust in him and his ideology.  No question that that‘s not going to be an issue. 

And look, to get back to a point that Wayne made, it‘s true that the religious appeal does work in a lot of states.  But really, there is only one appeal that Rick Perry needs to make in any state in the union, and that is his jobs record, again, saying truthfully that his taxes (ph) in the past half-decade has created more jobs than the other 49 states combined.  That‘s the winner for him, and that‘s why I think he‘s powerful. 

UYGUR:  Well, I want to ask Wayne about that.  But he of course has got some downsides, too. 

One last clip to show you, to talk about his downsides.  You know, he hinted at secession once.  Let‘s show you that.

(BEGIN VIDEO CLIP)

PERRY:  We‘ve got a great union.  There is absolutely no reason to dissolve it.  But if Washington continues to thumb their nose at the American people, who knows what may come out of that? 

(END VIDEO CLIP)

UYGUR:  So, a guy who is talking about secession, a guy who is—but has these social conservative credentials, et cetera, do you think that Josh is right?  Do you think he shoots up to number two in this field to challenge Romney, or is that overstating the case? 

SLATER:  You know, I think Josh has a point. 

Look, there is no question that his appeal at the moment and the design of the Perry team, the Perry campaign as it is, is to appeal to social and religious conservatives.  And so when he talks about secession, that is very popular with the Tea Party activists who are socially conservative.  When he talks about states‘ rights—a southern governor chanting “State rights” in a southern state, it has appeal in this year. 

At the same time, he and his advisers think that he can come to the table with the economic record in Texas, the jobs record, the business-friendly climate, and the current legislative session in which it is basically balancing the budget without new taxes, and that he can give Romney a run for his money, the first course here, the religious conservatives.  But I think Josh is right.  He has this economic side of his argument that he hopes will play among fiscal conservatives in the party. 

UYGUR:  You know what?  I‘ve got to tell you guys, I think you guys are right. 

Look, I obviously disagree with a lot of his policies, and that‘s for a different segment.  But I think he shoots up to number two as well if he gets in.  And so I would be shocked if he didn‘t. 

So it‘s an interesting development.  And we‘ll see how it goes.

Wayne Slater is from “The Dallas Morning News.”  Josh Trevino is from the Texas Public Policy Foundation. 

TREVINO:  Thank you.

UYGUR:  Thank you both tonight.  We really appreciate it. 

All right.  Now, when we come back, Paul Ryan and Speaker Boehner‘s con job revealed.  They fearmonger on Medicare, saying things like “bankrupt” and “broke.”  But new evidence shows we actually need more Medicare. 

(COMMERCIAL BREAK)

UYGUR:  The Republican ideology that the private market is always more efficient, especially when it comes to health care is our con job of the day.  Republican saying they are pushing the Ryan plan to turn Medicare into a voucher program because current healthcare costs are out of control. 

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER ®, OHIO:  Doing nothing means that the Medicare plan will go bankrupt and seniors cuts—seniors ‘benefits will be cut.  

UNIDENTIFIED MAN:  Medicare is in trouble.  Medicare is going broke.  

BOEHNER:  But Medicare is in trouble.  Soon, we are transforming Medicare so it will be there for the future.  

(END VIDEO CLIP)

UYGUR:  But the GOP privatization plan would actually raise healthcare costs. 

As Paul Krugman explains in “The New York Times,” Medicare spending per beneficiary has risen 400 percent since 1969.  But you might look that at that and go, whoa, that‘s a lot, right?  But wait until you get along to the next number.  In the same time period, private insurance spending per beneficiary rose 700 percent.  So, on the republican Medicare plan, seniors wouldn‘t just be on their own paper healthcare.  The cost for the service is they would actually be much higher.  Now, there is one obvious solution.  Krugman says, quote, “If we really want to hold down costs, we should be seeking to offer Medicare type programs to as many Americans as possible.” 

Now, that‘s what we argue for during the healthcare debate.  Medicare buy-in for everyone.  People would want to buy in because they‘d have peace of mind knowing they will be covered if they get sick.  And as a country, we would actually save a tremendous amount of money.  Because in reality, as you saw, the private market costs so much more and actually with no better results.  But of course, Republicans would never admit that expanding public coverage is a good idea.  The republican insistence that the private market is always better despite overwhelming proof to the contrary in this case is our con job of the day. 

Now ahead, the pressure mounts on another, on Anthony Weiner again.  But what about the Republicans?  Why are there disgraced officials still in office?  The RNC chairman was left speechless trying to answer that.  And President Obama once call Wall Street bankers fat cats.  Now he is secretly trying to make up with them over dinner.  Is that a good idea?  Our panel debates it.              

(COMMERCIAL BREAK)

UYGUR:  Welcome back to the show, everybody.  Now, to discuss some of these big political stories, we bring in our Power Panel.  With me is Michelle Cottle, contributor for Newsweek in The Daily Beast.  Also joining the panel, Robert Borosage, co-director of Campaign for America‘s Future.  And finally, Simon Rosenberg.  He‘s the president and founder of the New Democrat Network. 

Welcome everybody.  First question for the panel.  The question, is it really worth it?  “The New York Times” reports the president is trying too hard, to woe, Wall Street fat cats.  These are the same bankers that contribute $71 million to this campaign.  In 2008 and that‘s nearly 10 million more than to the Republicans in that election.  Remember, Goldman, Citigroup and J.P. Morgan were among his top seven campaign contributors.  But does it help for our democracy and does it help or hurt the president‘s reelection chances?  But I will start with you on that one, look, on the one hand, he needs money.  On the other hand, it is not good to go to the voters and say, look, I was really trying to help those Wall Street guys.  

ROBERT BOROSAGE, CO-DIRECTOR, CAMPAIGN FOR AMERICA‘S FUTURE:  Well, I don‘t think anybody is going to be surprise if the president gets contributions from Wall Street, he‘s deserves them.  You know, he sustained Bushes policies and bailing out the banks.  Nobody has been prosecuted.  Bonuses are back up to record levels.  The president has earned their gratitude.  He is not as shameless as Republicans.  They are trying to repeal even the small reforms we have had.  But I think the president has a very good chance.  You know, these are hedge fund operators.  So, they will hedge their bets.  They will put money on both parties.  But he‘s going where the money is, and I‘m sure he will do quite well.  

UYGUR:  Simon, is that too harsh or is Bob right?

SIMON ROSENBERG, PRESIDENT, NEW DEMOCRAT NETWORK:  That was a good one, Bob.  I think, listen, I think a year from now, if voters believe the president is on their side and own the side of struggling communities, he will get a pass on things like this fund-raiser.  But if he is seen as being too close to banks and too close to elite economic interests, he could spell a lot of trouble next year in his reelection.  

UYGUR:  So, Michelle, how do you thread this needle, right?  Because in our current system, unfortunately you need a ton of cash, right?  And who has it?  The Wall Street bankers.  On the other hand, the country hates the Wall Street bankers.  Rightfully so, in my opinion.  So, how do you thread that needle?

MICHELLE COTTLE, “THE DAILY BEAST”:  On one hand, you‘ve got do it.  Though, look, especially big money donors to political candidates tends to be a whiney entitled bunch.  They want their hand held.  They want to be invited lots of nice places.  And Obama hasn‘t been fortunate of having getting out there.  And calling them names and using a lot of populous rhetoric.  And even if they like some of his policies, they don‘t like that.  So, you know, he has to go in into a little damage control from time to time.  This is not the first time he‘s done this.  You know, there were stories six months ago about his charm offensive with the business community and probably six months before that.  So, this is just what he has to do to kind of get things, you know, in line for election time. 

UYGUR:  All right.  Bob, should he have to do it?

BOROSAGE:  It should be said in the president‘s defense, this is a guy who has said to hedge fund operators, it is not a good thing that you pay a lower tax rate than your chauffeurs.  And you know, the other party, the republican candidate, thinks those tax rates are just dandy.  So, president has taken a bite out of these folks.  But there‘s no question, he saved their skins and I‘m certain he can get some money out of them to run for president.  

UYGUR:  All right.  Real quick, Bob.  I want to stay with you on that.  Because look, you are the one doing the most criticism here.  And by the way, I don‘t want anybody to be confused, I agree.  OK.  But what do you do?  What do you do?  I mean, you say, all right, no, you guys are fat cats and I don‘t need your $71 million.  

BOROSAGE:  No.  I assume he‘s going to get money for them.  And as said, I think he deserves it.  I think the bigger question is, what‘s the country need in terms of getting finance shackled so the real economy can work again?  And what we haven‘t had are the investigations and the prosecutions and the accountability that we need to make certain that we don‘t go explode a new bubble and drive the economy over the cliff again. 

UYGUR:  Right.  

BOROSAGE:  And that reform agenda has to get pursued no matter where you get your money from in the campaign. 

UYGUR:  Yes.  Look, our system is broken man.  I mean, look at how terrible—the Republicans and the Democrats both have to go begging Wall Street for money.  Gee, I wonder why we‘re not tough on Wall Street.  I wonder how that turned out.  All right.  So, but we got to move on to the next question.  Are Republicans blind to their own hypocrisy?  Here‘s RNC Chairman Reince Priebus pushing for Weiner to resign while ignoring the past scandals of his own party.  Let‘s look. 

(BEGIN VIDEO CLIP)

REP. DEBBIE WASSERMAN SCHULTZ (D), FLORIDA:  What Reince is saying, it doesn‘t pass the straight-face test from a chair of the party who, none of whose leaders called for Senator Vitter who actually broke the law, to resign.  

REINCE PRIEBUS, RNC CHAIRMAN:  Senator Vitter, that‘s a five-year-old story.  Chris Lee, how long did he last?  About 30 seconds.  Senator Ensign resigned within six weeks and maybe coming chairman.  Look, I‘m not defending these guys but the fact of the matter is we have big issues here to tackle in this country.  

(END VIDEO CLIP)

UYGUR:  Michelle, is it a good strategy to counter Weiner with Vitter?  And did Reince do a descent job of answering that question?  Or there is no answer because Vitter still went office?

COTTLE:  There is no answer.  Look, hypocrisy is seems to be a pre-requisite for being a real partisan but both sides need to tiptoe around this.  Because they‘re both guilty when, you know, this pops up on both sides.  You know, I think the difference here which is making it really complicated for Democrats, all about the visuals.  You know, David Vitter may have left him some hookers but I‘m telling you, they did not have those pictures popping up and embarrassing him all over the Web.  And that is making it really tough for people to come and let this go.  

UYGUR:  You‘re right.  And there‘s new pictures of Weiner at the House.  Jim, I don‘t know what this guy was thinking.  Look, I‘ve defended him saying it is his private life but it was incredibly stupid to do all that.  Now, the president spoken out on NBC News.  Let‘s show you that and get your reaction.  

(BEGIN VIDEO CLIP)

UYGUR:  Obviously, what he did was highly inappropriate.  I think he‘s embarrassed himself.  He‘s acknowledged that.  He‘s embarrassed his wife and his family.  Ultimately, there‘s going to be a decision for him and his constituent.  I can tell you that if it was me, I would resign.  

(END VIDEO CLIP)

UYGUR:  Simon, good answer or no?

ROSENBERG:  I think we know how this is going to end.  I mean, I think the problem for Anthony Weiner is he doesn‘t come off just as having a broken faith with his wife but he comes of looking a little crazy here.  I think the way that these pictures were done, and pictures of himself when he‘s sitting on the couch.  I mean, I don‘t really remember anything like this in all the years I‘ve been in politics where it seems so incredibly self-destructive over such a long period of time.  And so, I think he‘s gone and however we get there at the end of the day, we don‘t really know.  But I think we know how the story is going to end.  

COTTLE:  And I really do think this house gym pictures are taking it another step.  

ROSENBERG:  I agree with that.  

COTTLE:  Because he brought it into the house gym.  I mean his colleagues are going to be looking at him, going, dude, come on.  I mean, this is going, I think. 

UYGUR:  I have a theory on this.  I have a theory on this.  I think that his problem was that he actually had a descent body.  Because—he doesn‘t take a picture of himself naked. 

(CROSSTALK)

OK.  Guys with guts, OK, nobody is taking pictures of my gut and sending it to anyone.  So, I think that was one of the problems.  But look, last thing, Bob, what do the Democrats do?  They are in a bind here, right?  Do you throw him under the bus?  It is a personal matter.  You shouldn‘t on ideology, on principle, I don‘t think.  On the other hand, God, it‘s such a distraction and so people have a good point about that.  What would you do?

BOROSAGE:  He is already under the bus.  He is done as a national spokesman.  Whether he stays in the Congress, he‘s really up to his constituents and his own conscience.  If I were a progressive in his district, I would be making plans and figure out who‘s going to run and who‘s going to challenge him.  I think he‘s gone, the question is when.  But the Democrats aren‘t going to stand next to him.  But whether you know, this is a private matter, whether he or not so private.  But whether he resigns or not, whether he resigns or not is really up to him.  But, you know, this is really mud pit politics.  The thing about the republican chairman that I think it‘s interesting is, you know, you pretend you‘re on the high road.  And meanwhile, you‘re wallowing in this stuff.  You can‘t pretend you‘re worried about the great issues facing the country when you are talking about Anthony Weiner. 

UYGUR:  All right.  Well, that‘s the Power Panel for tonight.  Michelle Cottle, Robert Borosage, Simon Rosenberg, thank you all for the great discussion. 

BOROSAGE:  Thanks. 

UYGUR:  All right, now, when we come back, is all Washington wrong?  Should we be talking less about cuts and more about jobs?  The case of the obvious when we come back.       

(COMMERCIAL BREAK)

UYGUR:  Washington has been dominated by cuts, cuts and more cuts.  And finally, the focus seems to be shifting.  That‘s good news.  President Obama was on the road to try to sell his jobs record.  But is he‘s planning a—all that talk on jobs?  We will discuss that with Robert Reich, next.      

(COMMERCIAL BREAK)

UYGUR:  Today, there‘s a growing debate in Washington over whether job creation is more important than spending cuts.  Finally, the debate we‘ve been waiting for.  Before all we ever heard was about spending cuts and how desperately we need them.  The GOP played that broken record again over the weekend. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED MAN:  I believe that we need to get our fiscal house in order.  

UNIDENTIFIED MAN:  We have a big spending problem in Washington.  

(END VIDEO CLIP)

UYGUR:  But now, finally, the battle is joined.  Folks on other side of the debate are chiming in over the last week.  Economists have begun pushing a key piece of economic wisdom.  Cuts won‘t solve the jobs crisis.  Spending will.  You have to actually higher people.  Jarrod Bernstein, former Economic Adviser to Vice President Biden wrote about a recently and then talk about it with me on this show.  Even Larry Summers, a former economic advisor to President Obama generally concerted a lot more conservative, agreed on a Washington Post editorial that concentrating on spending cuts is going in the wrong direction. 

And Robert Kuttner of “The American Prospect” did an excellent job summarizing the perils of concentrating a spending cuts in an article out today.  He said, quote, “but watch for the bipartisan gang of six and their conservative allies at Tim Geithner‘s Treasury Department, to snatch defeat out of the jaws of victory.  In the most likely budgets compromise, that saves the country from defaulting on the national debt.  The differences between the parties will collapsed in a largely conservative direction.  It the current script is followed, the Republicans will be the big winners, they will win on gutting social spending, aborting a fragile recovery, humbling the president and undercutting his reelection chances.” 

But the man who‘s going to settle all this of course is President Obama.  He is on a two-day jobs tour.  But will he listen to that progressive message that is now finally resounding throughout the country?  That‘s what we really have to see. 

Joining me now is one of those economists pushing the pro spending approach for job creation.  That‘s Robert Reich, he‘s now professor at UC Berkeley and former labor secretary under President Clinton. 

Secretary Reich, great to have you here.  I want to start with a

Kuttner quote, I know you bring about this topic as well, obviously,

because I think he gets the hard of it.  It looks like, you know, the

Democrats have the Republicans on the run on Medicare, et cetera.  If they

come in and the gang of six that includes Democrats and it obviously come

in.  Tim Geithner‘s Treasury Department seems to be pushing for spending

cuts.  And they say, all right, great, let‘s do the spending cuts.  Have

they done great damage both of the economy and to the president chances of

re-election? 

ROBERT REICH, PROFESSOR, UC BERKELEY:  Unfortunately, I think they will do damage, Cenk.  I mean, the frame of reference right now in the capitol, and you‘re right, it is beginning to change.  But the frame of references established by the Republicans is we‘ve got to cut spending.  If you cut spending, we get the balance, the budget back towards balance, that‘s good for the economy, that‘s good for jobs, that‘s good for everybody.  Well, that frame of reference is totally irrelevant right now given that consumers are holding back and businesses are holding back and we are flirting with a double-dip recession.  We‘ve got to.  I mean, the government has got to spend more.  At least in the short term. 

People are beginning to see that but that gang of six on the hill.  There are a lot of conservatives still hanging around.  Tim Geithner in the Treasury Department, there are many people who are whispering into Democrats ears including the president‘s ears.  Saying, well, we really do have to worry most about cutting spending and getting an agreement on—getting the budget deficit capped.  That is the total ceiling on the debts.  Going upward.  You see, we are right in a poise, the very, very difficult spot.  The president has got to decide.  And I hope he will decide that job creation is the number one issue, the number one goal and his number one responsibility.  

UGYUR:  I can‘t understand how he can‘t see it.  He is supposed to be a good politician.  I mean, I care about the economy.  I care about creating jobs.  I care about the American people.  I hope the president cares about the same thing.  But I know he also that has to care about getting re-elected.  And at nine percent unemployment, how are you going to do that?  I mean, have you heard of any economic theory that says, you do spending cuts and somehow magically when you already have inflation really low, it will create more jobs by time of November, 2012.  Doesn‘t that seem crazy?

REICH:  No, but it is a border line crazy, Cenk.  We know, I mean, if there is one thing we‘ve learned over the past 75 years, is that when you have high unemployment, when you‘ve got a lot of people out of work.  When you have such underutilized total capacity, the government has got to be the spender of last resort.  Now, if you call it stimulus, it doesn‘t matter.  Call it liver worst.  I don‘t care what you call it.  I mean, government has got to make up the difference somehow and has got to do something.  I mean, a WPA, you know, like we had during the depression, to give jobs to so many of the long-term unemployed or civilian conservation corps.  To give jobs to so many of young people who are sitting around doing nothing.  

UYGUR:  You know, I‘ve been saying this for so long.  And finally, Bursy (ph) is start writing about it this week as well.  Saying, hey, how is this for an idea?  Why don‘t we hire people?  Why doesn‘t the government actually say, I‘m going to hire extra number of people.  And that could be a gigantic number.  So, the Republicans will fight it.  OK.  Good.  They are against job creation.  I mean, I don‘t get it.  So, but it looks like, common sense, economic wisdom, all of the progresses in the world, combined are not as strong as Tim Geithner.  I mean. 

(CROSSTALK)

REICH:  Well, I don‘t—I‘m not going to play personality here.  I mean, the issue is, and you put your finger on it just now, it‘s common sense.  And the question is, will common sense and political pressure prevail?  I mean, most Americans are in very, very tough shape right now.  This is not just a matter of politics.  It‘s a matter of pain.  The degree of public pain, of suffering, of anxiety out there in the country should not be underestimated.  Now, Washington is a little bit of an echo chamber as we know, so is New York.  A lot of this pain does not get through.  But if these people, including the president, want to be re-elected, they have got to come up with a very bold jobs plan.  And they got to come up with it soon.  Because if you were the vacuum there, if there is nothing there, if the Democrats and the president are not putting out anything specific, anything bold to stimulate and boost demand, what are you going to have?  That vacuum is going to be filled by Republicans who say cut taxes, cut spending, the old republican play book, which has nothing whatever to do with creating job cuts. 

UYGUR:  Secretary Reich, I know, you say, (INAUDIBLE), so leave that to me.  Tim Geithner is the worst.  He is a former republican.  All he has is republican ideas.  He‘s never been a democrat, never claimed to be a democrat and he is pushing all these incredibly conservative ideas to the great detrimental of the president and of the country.  I think that‘s a huge part of the problem.  I think the president‘s biggest mistake as we‘re listening to Tim Geithner all along on every front.  But my views on that are clear.  You have the more professorial. 

REICH:  Look, I‘m not—I don‘t mean to duck from any individual criticism.  I‘m just saying, look, the issues are very, very clear.  And I think that the president would be very wise, just get out there, use the bullet pulpit and says to Republicans, here is my job plan, if you don‘t like it, I‘m going to fight for it.  I‘m going to fight for it.  

UYGUR:  That would be good.  We got to live it right there.  Secretary Reich, thank you so much.  We‘ll be right back.                           

(COMMERCIAL BREAK)

UYGUR:  A scathing new report reveals just how effective the American banks and their lobbyist were in watering down regulations that help fuel our mortgage melt down.  Two IMF economists just wrote a new article saying quote, “In the period from 2000 to 2006, a bill that was unfavorable to the financial industry was three times less likely to become law than one promoting deregulation.”  So of course, there was a great drive for deregulation.  Well, let‘s find out who caused that drive and what it resulted in.  The economists at IMF determined that quote, there is a clear association between the money affected financial firms spent on lobbying and the way that the legislators voted on the key bills considered before the crisis.  Shocking.  It terms out the more money you spend on lobbying, the more laws can you buy. 

The IMF researchers also concluded that if a lobbyists had worked for a legislator in the past, the legislator was very likely to vote in favor of less regulation.  That‘s why the lobbyists by the top staff is on the hill after they leave their government jobs.  Now, what was the result of all of this?  The report found quote, “lenders that lobbied heavily between 2000 and 2006 tended to engage in risky lending practices more often than other institutions over the same period and suffered worst outcomes during the crisis.”  So, how did this work.  They lobby for deregulation, they bought the staffers.  They bought the politicians.  They got the deregulation, then they crashed.  But don‘t worry, they shuffle that cost on to taxpayers anyway.  Our system of government is broken.  The way we finance election is broken.  They buy our politicians, they get the results that they want and to everyone‘s detriment.  It even hurt their own firms and it certainly hurt all the taxpayers.  We‘ve got to find a new way.  This is not helping our democracy. 

All right.  That‘s our show for today, of course you can always check me out on TheYoungTurks.com, and on YouTube/TheYoungTurks, “HARDBALL” is up right now. 

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