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'The Last Word with Lawrence O'Donnell' for Thursday, June 30, 2011

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Guests: Ezra Klein, Howard Fineman, Bruce Bartlett, Alex Wagner

           

LAWRENCE O‘DONNELL, HOST:  Suddenly, everyone in Washington is wondering, is there a nuclear option on the debt ceiling?  And is that nuclear option the Constitution of the United States?

(BEGIN VIDEOTAPE)

(MUSIC)

UNIDENTIFIED MALE:  Maybe if he‘d just take a valium and calm down and come on down talk to us, it might be helpful.

DYLAN RATIGAN, MSNBC HOST:  Pro-wrestling at its political finest.

O‘DONNELL (voice-over):  Republicans say yes to postponing their vacation, but no to everything else.

UNIDENTIFIED MALE:  I, along with the other Republican members, will not be attending the markup, thereby denying the necessary quorum.

ANDREA MITCHELL, NBC NEWS:  The Senate is canceling its planned recess next week for the 4th of July.

UNIDENTIFIED MALE:  Mitch McConnell making a big deal of inviting the president for a chat on no notice with the knowledge that he already had plans.

UNIDENTIFIED MALE:  The president said he wasn‘t going to change his plans to meet with Mitch McConnell.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY:  He also invited him to hear

invited the president to hear what would not pass.

           

HOWARD DEAN, FORMER DNC CHAIRMAN:  Is it logic here?  The Republicans are not big on logic.

ALAN SIMPSON, DEFICIT COMMISSION:  If they don‘t this time, the full faith and credit of the U.S. will be in peril.

JON STEWART, THE DAILY SHOW:  If we don‘t do that—wait, what happens again?

CARNEY:  Armageddon.

UNIDENTIFIED MALE:  Armageddon.

UNIDENTIFIED MALE:  Armageddon.

O‘DONNELL:  Meanwhile, Democrats are saying yes to Michele Bachmann.

WILLIAM J. CLINTON, FORMER U.S. PRESIDENT:  I‘m not surprised by how well Michele Bachmann has done.  She comes across as a real person.

UNIDENTIFIED MALE:  Obama has got some magic.

UNIDENTIFIED MALE:  Kind of real human moments, but very compelling to voters.

UNIDENTIFIED MALE:  Obama‘s got some magic.

UNIDENTIFIED MALE:  Embarrassment of riches.

UNIDENTIFIED MALE:  Obama‘s got some magic.

UNIDENTIFIED MALE:  With the wink and a hug, she‘s made the majority of the GOP field disappear.

UNIDENTIFIED FEMALE:  King James called Napoleon and together decided to kill America.  They sent the Nina, Pinata, and Santa Maria to fight.

O‘DONNELL:  And Federal Elections Commission says yes to Stephen Colbert.

STEPHEN COLBERT, THE COLBERT REPORT:  Ladies and gentlemen, I‘m sorry to say, we won!

(CHEERS)

CHUCK TODD, NBC NEWS:  It‘s so cool to be at super PAC that even Stephen Colbert is doing it.

UNIDENTIFIED FEMALE:  It‘s something from a channel called Comedy Central.

O‘DONNELL:  And, yes, this comedy is really over.

(END VIDEOTAPE)

O‘DONNELL:  Good evening from New York.

Republican Senate leader Mitch McConnell had a message for the president today.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER:  I‘d like to invite the president to come to the Capitol today, to meet with Senate Republicans.  Anytime this afternoon, he‘s available, to come on up to the Capitol and meet with Senate Republicans.  That way he can hear directly from Senate Republicans, directly from Senate Republicans why what he is proposing will not pass.  All of us know that Congress isn‘t going to approve hundreds of billions of dollars in tax hikes.

(END VIDEO CLIP)

O‘DONNELL:  McConnell, who yesterday during the president‘s press conference, held a phony press conference about a phony constitutional amendment that will never pass, spent today issuing phony invitations to the president and making phony references to what he calls tax hikes.

The current Republican position that any agreement on deficit reduction must be 100 percent spending cuts and zero percent tax revenue increases, contradicts an earlier Republican position.

Republican leaders in Congress clearly do not believe that any revenue increases are unacceptable in principle, because they are right now touting a study by three conservative economists from the conservative American Enterprise Institute which found that, quote, “successful fiscal consolidations averaged 85 percent spending cuts and 15 percent revenue increases.”  Eighty-five/15 -- 15 percent revenue increases.  There is a big difference between 15 percent and zero percent.

This study can be found right now on House Speaker John Boehner‘s Web site, Speaker.gov.

There are reports now seeping out of the ultra secret bipartisan deficit reduction negotiations led by Vice President Joe Biden that the ratio that was on the table when the Republicans walked out was 83 percent spending cuts, 17 percent revenue increases.

So when the talks got within a couple of percentage points of the ratio that Republicans recently considered acceptable, why did the Republicans walk out?

Senator Chuck Schumer knows why.

(BEGIN VIDEO CLIP)

SEN. CHUCK SCHUMER (D), NEW YORK:  Let‘s not forget Senator McConnell made it clear last October that his number one priority above everything else is to defeat President Obama.  And now it‘s becoming clear that insisting on a slash and burn approach may be part of this plan.  It has a double benefit for Republicans.  It‘s ideologically tidy and undermines economic recovery, which they think only helps them in 2012.

(END VIDEO CLIP)

O‘DONNELL:  The current position on tax revenues including the refusal to close tax loopholes is too extreme even for Republicans formerly thought of as conservative.

(BEGIN VIDEO CLIP)

FMR. SEN. ALAN SIMPSON, FISCAL COMMISSION CO-CHAIR:  Tax expenditures,

it‘s really, really nothing more than tax spending.  They‘re spending by any other name.  They are really, really earmarks.

When we went into these tax expenditures, we found that only 10 percent of the American public, the wealthiest people in America, use them, because they are the ones that can hire the best lobbyists, go to the finance committee.

The little guy had no idea what they are.  It means nothing to him. 

He does the standard deduction and walks away.

We found the top 400 income earners in the United States pay an average of 16 percent income tax, and it‘s absolutely absurd.

(END VIDEO CLIP)

O‘DONNELL:  On CNBC today, longtime former Federal Reserve Chair Alan Greenspan first appointed by President Reagan and reappointed by Presidents Clinton and the Presidents Bush addressed the tax question.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  Should the president take the tax increases that the Republicans say they‘re not going to agree to off the table so that they could actually come to an agreement on this debt?

ALAN GREENSPAN, FORMER FEDERAL RESERVE CHAIRMAN:  I think that the Republicans ought to identify a very significant amount of so-called tax expenditures which in fact are misclassified.  They are expenditures.  They are outlays, and many of them are subsidies.  And subsidies are not the type of thing that you want for an efficient market system.  There are a lot of them.

(END VIDEO CLIP)

O‘DONNELL:  Alan Greenspan‘s position on taxation is charmingly old-fashioned.  He actually thinks that the government should raise as much in tax revenue as it spends.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE:  You said that the 1990s era tax rates would actually be helpful in terms of helping this?

GREENSPAN:  My view is that I was in favor of the Bush tax cuts on the grounds that it was the dissipation of a surplus.  As soon as it became obvious that the surplus disappeared, I no longer supported that.  And my view about taxes is I would like them as low as possible, but not with borrowed money.

(END VIDEO CLIP)

O‘DONNELL:  Joining me now, Ezra Klein, MSNBC analyst and columnist for “The Washington Post” and “Bloomberg View.”

Thanks for joining me tonight, Ezra.

EZRA KLEIN, MSNBC ANALYST:  Good evening.

O‘DONNELL:  Ezra, I want to thank you for pointing out to us that study that is on Speaker Boehner‘s Web site, or was on his Web site at the beginning of this program and perhaps soon will be scrubbed from his Web site, indicating—a study by conservative economists indicating that a very successful formula for deficit reduction is 85 percent spending cuts, and 15 percent tax revenue increases.

That study I believe was done on foreign examples.  It‘s not a model surveying all of the recent versions of deficit reduction that we‘ve done here in the United States, is it?

KLEIN:  Right.  It is not at all.  So I got pointed to that study by my consult at the Roosevelt Institute.  And I remember when it came out.  It was March of 2011.  And it was considered by most people to look at it to be a pretty extreme study.  It misinterpreted a lot of the examples they used.

A lot of folks had done the successful fiscal consolidation, successful deficit reduction had done so by doing it in the late 1990s, when the economy was great, when you could export a lot, when there were other ways to recover.

But even so, that was considered a fairly extreme result they got.  And yet, that extreme result got put on the table by Barack Obama and the Democrats.  They had a $2.4 trillion deficit reduction, $400 billion taxes, and the Republicans didn‘t just say, no, that‘s not quite good enough, they walked out.

O‘DONNELL:  Yes.  The interesting model for deficit reduction I always thought for the Obama White House was the Clinton model, the 1993 bill, which was 50/50.  It was 50 percent spending cuts, 50 percent tax revenue increases.

Why wouldn‘t the White House have looked at the Clinton deficit reduction package, which then led us to the most economically successful decade that we‘ve had with the highest surge in incomes that we‘ve ever seen, especially at the top end?  Why didn‘t they start with that and say, we want to do the Clinton model, you Republicans?  We want to do 50/50?  And I suppose negotiate away from that.

KLEIN:  Because the Obama administration has a funny tendency to start with what they think would be an acceptable final compromise to the Republicans.  Their health care bill, cap and trade, the budget deal they put on the table here when they came in with their deficit framework, and it was somewhat to the right of the fiscal commission.  They had fewer defense cuts and fewer taxes than the fiscal commission did.

They come in with a bid to appear reasonable.  They gave Republicans something they think they‘ll like and they—I‘m not saying they are shocked every time Republicans get up and walk out, but every time Republicans do, look at what they put on the table and say no, and the say no because they are frankly not interested in compromising with this administration.

McConnell had this amazing quote the other day, where he said the president can have one of two things.  He can have a bipartisan deal on the deficit or tax increases, but not both.

Now, in any normal accounting, a bipartisan deal would be one with tax increases and spending cuts.  But that is not how the current Republican majority works.  They are simply saying if you want any of our support, if you want to pass any of these bills, you give us everything that we want.

O‘DONNELL:  It seems, Ezra, that the White House is now hoping that outside interests in the Republican world, like Wall Street and business interests, will prevail and try to deliver some sanity to the John Boehners in the House of Representatives and Mitch McConnells to try to get them to step up and agree to raising the debt ceiling.

Is there any evidence that these people, that this new version of the Republican Party, will listen carefully and take dictation from Wall Street?

KLEIN:  No.  It‘s never a great bet—nor from Main Street for that matter.  There‘s a tendency for people to have in their head a model of politics where the actors are heavily influenced by large corporations, lobbyists, and trade firms, and they are.  But when you‘re dealing with mega-polarizing issues, when you‘re dealing with high-profile stuff, things like the health vote or the debt ceiling vote, these groups do not have that much sway.

A great example of this is, right now, the Chamber of Commerce and the AFL-CIO are both lobbying for the big infrastructure bill that Barack Obama proposed.  That is an all-star team right there, the Chamber of Commerce and the AFL-CIO, it has gone nowhere.  When you have a polarizing vote, people are—the Republicans are much more afraid of the Tea Party and the Democrats are more afraid or more interested in their base than they are in outside groups.

O‘DONNELL:  MSNBC analyst Ezra Klein—thanks for joining me tonight.

KLEIN:  Thank you.

O‘DONNELL:  If Republicans in Congress refuse to raise the debt ceiling, there may be a way—a way never even considered before, to avoid a catastrophic default, the 14th Amendment of the United States Constitution.

Joining me now is Bruce Bartlett, who served as executive director of the Joint Economic Committee as a senior policy analyst in the Reagan White House and as deputy assistant secretary at treasury during the first Bush administration.  He is now a columnist for “The Fiscal Times” and a contributor for “The New York Times.”

Thanks for joining me tonight, Bruce.

BRUCE BARTLETT, THE FISCAL TIMES:  Happy to be here.

O‘DONNELL:  Bruce, every provision of the Constitution at some point gets its 15 minutes of fame.  The 14th Amendment has now begun its 15 minutes of fame.

I want to read to you the relevant piece of this, “The validity of the public debt of the United States authorized by law, including debts incurred for payments of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”

There are those, Bruce, who are saying that what this provision means is we don‘t even need to legislate a debt authorized ceiling, an authorized amount of debt, that the Constitution, in effect, trumps everything and authorizes whatever debt the United States incurs.

BARTLETT:  I think a broad reading of that provision of the Constitution is justified, especially the part about the pensions.  And because that implies a symmetry to things such as Social Security benefits, which one can argue is a debt that is owed to the people who paid the taxes and the expectation of getting a benefit.  And that would be true of Medicare benefits.  And of course a lot of what the government pays for is vendors who provide goods and services to the government, especially the Department of Defense.

It seems to me that all of those things can be legitimately considered debts that cannot be questioned.  And the term “cannot be questioned” is about the broadest, strongest, constitutional language you can find in the Constitution.

O‘DONNELL:  And so, this now introduces the possibility of a so-called nuclear option in what we all thought was the inevitable need to reach an agreement, there must be some kind of agreement on raising the debt ceiling.  Maybe there doesn‘t have to be an agreement if the president wants to invoke the 14th Amendment of the Constitution.

And let‘s just scheme it out here for a minute, Bruce.  Assuming we got to August 2nd, assuming there was no action, the Republicans didn‘t allow action.  It didn‘t move forward, there wasn‘t an agreement that people could vote on.  At that point, could the president simply go out and make a speech citing the 14th Amendment and announcing to the world, to our creditors around the world, to Social Security recipients, “I, as the chief executive of the executive branch, will continue to make all payments that we are obliged to make”?  And therefore, this debt will continue to increase.

BARTLETT:  Well, I think the timing here is going to have to be pretty important.  There‘s a lot of discussion about the precise date at which the treasury literally runs out of money.  But one of the important things to keep in mind here is that that date is very likely to happen when Congress is in recess, during August.

So ,we may come up to—so there may simply be no other alternative, and I think that when that day comes, the president would be on very, very strong constitutional grounds by saying protecting the credit of the United States is as important as protecting the lives and property of the American people.  And it would justify the same kind of response that he exercises as commander in chief.

And he could—I think he should the treasury --- under those circumstances, order the treasury secretary to simply borrow as much as necessary to repay—to maintain the country‘s credit and avoid default.

O‘DONNELL:  And, Bruce, quickly before we go, in the minutes I‘ve had to think about this, I haven‘t been able to figure out how anyone could stop the president from doing that.  If that happened and the president did that, what would the Republicans be able to do to stop him?

BARTLETT:  Well, Professor Jonathan Zaslow of UCLA has argued that no one would have standing to sue the president if he did this, except the Congress as a whole.  The House and the Senate would have to pass a joint resolution, condemning the president‘s action, and authorizing a lawsuit.  And I think that‘s very unlikely.

O‘DONNELL:  The votes wouldn‘t be there for joint resolutions in both bodies under those circumstances.  It‘s getting interesting.

Bruce Bartlett, former senior policy analyst in the Reagan White House, now a columnist for “The Fiscal Times”—thank you very much for joining me tonight, Bruce.

BARTLETT:  Happy to be here.

O‘DONNELL:  Coming up: former President Bill Clinton praises Michele Bachmann and says he‘s not surprised she‘s a 2012 front-runner for the Republican nomination.  Republican governors, as usual, disagree with Bill Clinton.  We‘ll show you who‘s behind the Republican “stop Bachmann” movement.

And Stephen Colbert proudly follows in the footsteps of Karl Rove. 

Stephen got a super PAC.

(COMMERCIAL BREAK)

O‘DONNELL:  Coming up: Bill Clinton praises Michele Bachmann, while a Republican governor compares her to Barack Obama, which is not exactly a compliment in Republican circles.

And Jimmy Kimmel rewrites Michele Bachmann‘s rewrite of American history, which gives us a “Rewrite” you don‘t want to miss.  It‘s Jimmy Kimmel doing tonight‘s “Rewrite.”

(COMMERCIAL BREAK)

O‘DONNELL:  This morning, in what may be his latest desperate plea for attention, former President Bill Clinton decided to say some very nice things about Republican presidential candidate Michele Bachmann.

(BEGIN VIDEO CLIP)

WILLIAM J. CLINTON, FORMER U.S. PRESIDENT:  I‘m not surprised by how well Michele Bachmann has done.  I have been watching her speak.  She comes across as a real person.  All those foster children she‘s taken in and children she‘s raised.

(END VIDEO CLIP)

O‘DONNELL:  Then Clinton talked about the other Republican candidates for president.

(BEGIN VIDEO CLIP)

CLINTON:  The ones I like are the ones that you think are more moderate.

(END VIDEO CLIP)

O‘DONNELL:  More moderate?  There are no moderate Republican candidates running for president.  Who is this guy talking about?

All right.  Let‘s just listen to the rest of what Clinton said.

(BEGIN VIDEO CLIP)

CLINTON:  The ones I like are the ones that you think are more moderate.  Because I think they are more connected to the real world.  And I think they‘ll be—they would be formidable.  I think.  But I‘m afraid if I say anything nice about them, they‘ll lose for sure.

(END VIDEO CLIP)

O‘DONNELL:  OK.  Again, there are no moderate Republican candidates running for president.  Yes, moderate Republicans who used to exist during Clinton‘s presidency were more connected to the real world, which is part of the reason the Clinton presidency, which began with what we then thought was a big deficit, ended with what we all thought and continue to think was a very, very big surplus.  But those days are over.

As the “St. Louis Post Dispatch” editorial that I read here last night noted, there really are no more moderate Republicans in office.  And, yes, Clinton is right in thinking that a moderate Republican would be a formidable re-election opponent for Barack Obama, but none of the current Republican candidates can beat him.

And then there‘s Clinton‘s egomaniacal notion that if he says anything nice about a Republican candidate, then that candidate will lose for sure.

It is hard to be more irrelevant to Republican primary voters than Bill Clinton is.  Nor is he terribly influential with Democratic presidential primary voters for that matter.  If he was, he‘d be living in the White House tonight.

Of more concern for the Republican candidates for president is what actual Republicans say about them.  Political reports that Republican governors are beginning to make themselves heard on the campaign trail, which is not turning out to be good news for Michele Bachmann.

Republican Iowa Governor Terry Branstad told “Politico,” “The history of our country shows governors have been the most successful presidents.  She‘s an exciting candidate.  She brings a lot of enthusiasm, and I think she helps to rally the Republican base, and I certainly have a lot of respect for her, but she doesn‘t have the executive experience that governors have.”

And then Governor Branstad said the worst thing he could possibly say about Michele Bachmann.  He compared her accomplishment-free congressional career now only in its fifth year to Barack Obama‘s preparation for the presidency.  “And especially when you look at how we elected a candidate who had charisma but no experience, and you look at the situation we‘re in today, a lot of people are saying we need more than charisma, we need experience, and the ability to make tough decisions that chief executives have to make.”

Joining me now is Howard Fineman, NBC News political analyst and senior political editor for “The Huffington Post.”

Thanks you for joining me tonight, Howard.

HOWARD FINEMAN, MSNBC POLITICAL ANALYST:  Hi, Lawrence.

O‘DONNELL:  Howard, let‘s just start with Bill Clinton, with what Bill Clinton is up to here.  And we can stipulate that it‘s entirely possible that he‘s up to nothing other than the limitless joy of hearing himself talk.  But am I—could there be something clever to what Bill Clinton is doing in praising Michele Bachmann?

FINEMAN:  Lawrence, I have known and covered Bill Clinton for, I don‘t know, about 25 years.  He doesn‘t just kill two birds with one stone.  He kills a whole flock, OK?

Of course, he wants the publicity.  All politics is local, Lawrence.  The Clinton Global Initiative meeting is going on, in competition with the Aspen Ideas Festival.

So, Bill Clinton wants to generate some headlines for his conference. 

And just for being Bill Clinton.

But he‘s also trying to do what he thinks is a favor for the White House.  And I think Bill Clinton cares about being politically relevant to Barack Obama and the White House, wants to do chores for them, even if they don‘t ask him to.

In this case, he‘s trying to stir up trouble.  He‘s trying to build up Michele Bachmann so that she is a formidable force in Iowa and elsewhere, to make life miserable for the very moderates he says would be the stronger candidates.

So, that‘s what Bill Clinton is up to.

O‘DONNELL:  And the Republican governors have been awakened.  It seems to me that they are starting the “stop Bachmann” movement.  I mean, what Branstad is saying about, you know, she‘s very nice, but she‘s got the charisma just like Barack Obama had the charisma, but look what charisma gets you.  You need a governor.

He‘s very specific with saying, you need one of the governors.

FINEMAN:  I know.  But again, all politics is local.  Terry Branstad is the governor of Iowa, the second time around as governor of Iowa.  He loves the Iowa caucuses.  The Iowa caucuses bring a lot of money into Iowa.

Michele Bachmann is going like gang busters in Iowa.

The subtext of what Terry Branstad was saying, is, hey, Mitt Romney, hey, Tim Pawlenty, you‘re former governors, don‘t give up on Iowa.  Get in here and compete.

Now, Pawlenty is doing it, but don‘t forget, Mitt Romney is not taking part in the straw poll in Ames in August.  He‘s trying to blow off Iowa, not really compete there.

The subtext there is Branstad saying, please come to Iowa and compete here—in addition to the point that he makes about governors, which is a perfectly valid one.

O‘DONNELL:  Howard, Michele Bachmann‘s husband has been unknown to me.  And I think other observers of national politics up to now.  But when you get into that presidential campaign, the heat is on, the microscope starts focusing.

Listen to something that her husband has said.

(BEGIN AUDIO CLIP)

MARCUS BACHMANN:  We have to understand, barbarians need to be educated.  They need to be disciplined.  And just because someone feels it or thinks it doesn‘t mean that we‘re supposed to go down that road.  That‘s what‘s called the sinful nature.  And we have a responsibility as parents and as authority figures not to encourage such thoughts and feelings from moving into the action steps.

(END AUDIO CLIP)

O‘DONNELL:  Howard, the barbarians he‘s talking about are gay people. 

He can obviously produce quotes that are even hotter than Michele Bachmann.

FINEMAN:  Yes.

O‘DONNELL:  So, now, she‘s going to be carrying the dual liability of what she says and her husband says going forward.

FINEMAN:  Right.  I think so.  And I was in Minnesota the other day as you know, Lawrence, talking to Democrats up there.  They talked about the gay issue with Michele Bachmann.  I mean, she was famous in the state legislature for making a big deal out of this, for being a proponent of traditional marriage, and having a lot of things to say about the gay lifestyle and about gays and lesbians, et cetera.

That‘s very much a part of the package of who she is.  And it‘s one of the things that‘s going to be an issue because she and her husband have both made some statements and taken some actions that are going to get a lot of attention out there.  And that will turn—it will help her with evangelical Christians, but not with anybody else, even in the Republican caucuses.

O‘DONNELL:  MSNBC political analyst Howard Fineman—thanks for joining me tonight, Howard.

FINEMAN:  Thanks, Lawrence.

O‘DONNELL:  Coming up: Jimmy Kimmel‘s take on Michele Bachmann gives us everything we need for a “Rewrite” that you just cannot miss tonight.

And in the spotlight, if Karl Rove‘s super PAC is a threat to democracy, just how dangerous is the Colbert super PAC?

(COMMERCIAL BREAK)

O‘DONNELL:  This just in; Pat Robertson has reacted to the passage of the marriage equality legislation in New York, saying that “it is a warning that God is going to destroy America.” 

Robertson didn‘t say exactly when God was going to get around to that. 

So we will continue with the program. 

Still to come tonight, earlier today, the Federal Election Commission granted permission to comedian Stephen Colbert to set up his own super PAC.  What precedent does this set for other cable hosts that want to follow in Colbert‘s footsteps? 

Are we really ready for the O‘Donnell Super PAC?  That‘s coming up. 

And Republican presidential candidate Michele Bachmann refuses to correct her mistakes, so Jimmy Kimmel gives us Michele Bachmann‘s version of American history.  And that is tonight‘s unmissable Rewrite.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  All those in favor, say aye. 

UNIDENTIFIED MALE:  Aye. 

UNIDENTIFIED FEMALE:  Opposed? 

UNIDENTIFIED MALE:  No. 

UNIDENTIFIED FEMALE:  Motion carries, five to one.  So although we have just taken two separate votes, there will be one advisory opinion.  Mr. Colbert, you may form your PAC and proceed as the commission has advised in this opinion. 

(END VIDEO CLIP)

O‘DONNELL:  Yes, that really was the real Federal Election Commission granting Stephen Colbert permission to set up his political action committee, Colbert Super PAC.  It will join over 100 super PACs that have been formed since the Supreme Court has ruled in favor of Citizens United. 

The FEC ruled today that “The Colbert Report” can, in effect, advertise the Colbert Super PAC on the show without treating the air time used to discuss the Colbert Super PAC on the show as a contribution from the network Comedy Central or its parent company, Viacom. 

Colbert somehow managed to contain himself at the hearing today, and allowed his attorney to handle most of the questions.  But once the Colbert Super PAC was approved, the artist currently known as Colbert returned to form. 

(BEGIN VIDEO CLIP)

STEPHEN COLBERT, “THE COLBERT REPORT”:  I am here to represent your voice, so please quiet down, so we can all hear what you have to say with my mouth.  There will be others who say Stephen Colbert, what will you do with that unrestricted super PAC money? 

To which I say, I don‘t know.  Give it to me and let‘s find out.  Because I don‘t know about you, but I do not accept limits on my free speech.  I don‘t know about you, but I do not accept the status quo. 

But I do accept Visa, Master Card, and American Express. 

(END VIDEO CLIP)

O‘DONNELL:  Joining me now, “Huffington Post” reporter and MSNBC contributor, Alex Wagner.  Thanks for joining me tonight, Alex.

ALEX WAGNER, “HUFFINGTON POST”:  Thanks for having me.

O‘DONNELL:  Have you made your contribution yet to the Colbert Super

PAC? 

WAGNER:  In a donation under 50 dollars, so that he does not have to disclose it. 

O‘DONNELL:  So the question of the day is, is this a joke? 

WAGNER:  No.  Look, the FEC ruled in his favor.  And the FEC is a very serious body.  My favorite part of that whole sort of scene in Washington today was that they panned out from the rest of the room.  And you could see the faces of all of the FEC folks on the board.

And they were just beaming, like we‘re finally getting our 15 minutes.  But it is very serious.  Look, this sets a precedent.  Now other folks on other channels who have political leanings, such as Sarah Palin, will be free to fund raise and advocate and, you know—

O‘DONNELL:  Well, she already—Palin already has a PAC.  All they said today was if you discuss the PAC on your show, that will not be considered a contribution from Viacom or Comedy Central.  It was a very minor point.  It doesn‘t really change the landscape much. 

Let‘s listen to Colbert‘s answer to the question of, is this a joke? 

(BEGIN VIDEO CLIP)

COLBERT:  Now, some people have cynically asked, is this some kind of joke?  I, for one, don‘t think that participating in democracy is a joke.  I don‘t think that wanting to know what the rules are is a joke.

But I do have one federal election law joke, if you‘d like to hear it. 

Knock, knock. 

CROWD:  Who‘s there? 

COLBERT:  Unlimited union and corporate campaign contributions. 

CROWD:  Who?

COLBERT:  That‘s the thing.  I don‘t think I should have to tell you. 

(END VIDEO CLIP)

O‘DONNELL:  Ahead of the ruling, some advocacy groups like Democracy 21, Campaign Legal Center, they urged the FEC to not allow this definition, this technical definition of it not being a contribution.  I‘m not sure exactly what there is to fear there.  They mentioned that Sarah Palin has a PAC.  Mike Huckabee has a PAC. 

They already do have a PAC.  It‘s just a question of what happens when they mention it on Fox News.  That could be controlled by Fox News.  Fox News can just say, you can‘t discuss your PAC. 

WAGNER:  I think, actually Colbert was pushing for broader press freedoms if you will.  He wanted to be able to use staffing from his show to create advertisements.  He wanted to be able to run his advertisements for his PAC on other shows. 

The—Democracy 21 sort of took a very firm stance against that, because it, again, sets a questionable precedent.  You know, as far as Fox News, what this points to is a broader and I think more disconcerting trend, in terms of money, media, and influence. 

And you look at Fox News.  And this, again, is a channel that—let‘s remind our viewers here—donated a million dollars to the U.S. Chamber of Commerce and 1.25 million dollars to the Republican Governors Association last year. 

That was precedent setting.  So you now have a confluence of media and money.  If we are talking about free speech and democracy and the political process and transparency, I think it‘s a disturbing trend. 

O‘DONNELL:  What he‘s really done for himself is created a nightmarish bookkeeping task.  He has to record every dime that comes into that PAC, where it came from, occupation, address of who sent it, and then every penny he spends in that PAC.  We‘ll see how long he enjoys doing that. 

WAGNER:  Indeed, we will. 

O‘DONNELL:  Alex Wagner of the “Huffington Post,” thank you very much for joining me tonight. 

WAGNER:  Thanks, Lawrence. 

O‘DONNELL:  Coming up, American history Bachmann style.  The Republican presidential candidate sticks to her own version of history, which provokes Jimmy Kimmel to present American history according to Michele Bachmann. 

And we will bring you Glenn Beck‘s final minute on the air tonight at Fox News.  That‘s coming up.

(COMMERCIAL BREAK)

O‘DONNELL:  Time for tonight‘s Rewrite.  Michele Bachmann has made the political decision to never, ever admit that she‘s wrong.  It‘s not an unusual decision for a politician.  Most of them have made that exact same decision.  And most of them get away with that, most of the time.  But very, very few of them are as wrong as often as Michele Bachmann is wrong. 

No one can forget this one. 

(BEGIN VIDEO CLIP)

BACHMANN:  We know there was slavery that was still tolerated when the nation began.  We know that was an evil, and it was a scourge and a blot and a stain upon our history. 

But we also know that the very founders that wrote those documents worked tirelessly until slavery was no more in the United States.  And I think it is high time that we recognize the contribution of our forebears who worked tirelessly, men like John Quincy Adams, who would not rest until slavery was extinguished in the country. 

(END VIDEO CLIP)

O‘DONNELL:  When informed by reporters who could remember enough of their elementary school American history that she was wrong about that, nothing could make her admit it.  Her most recent refusal( to admit how wrong she was occurred this week with George Stephanopoulos. 

(BEGIN VIDEO CLIP)

GEORGE STEPHANOPOULOS, ABC NEWS ANCHOR:  You said that the founding fathers worked tirelessly to end slavery. 

BACHMANN:  Well, if you look at one of our founding fathers, John Quincy Adams, that‘s absolutely true.  He was a very young boy when he was with his father, serving essentially as his father‘s secretary.  He tirelessly worked throughout his life to make sure that we did, in fact, one day eradicate slavery.

O‘DONNELL:  He wasn‘t one of the founding fathers.  He was a president.  He was a secretary of state.  He was a member of Congress.  You‘re right, he did work to end slavery decades later. 

But—so you‘re standing by this comment that the founding fathers worked tirelessly to end slavery? 

WAGNER:  Well, John Quincy Adams most certainly was a part of the Revolutionary War era.  He was a young boy, but he was actively involved. 

(END VIDEO CLIP)

O‘DONNELL:  So it‘s not surprising that some observers believe that Michele Bachmann‘s campaign is going to depend on even more Rewriting of history. 

(BEGIN VIDEO CLIP)

JIMMY KIMMEL, “JIMMY KIMMEL LIVE”:  Not only is Michele Bachmann sticking to this founding father thing, she is working on—I don‘t know if it‘s a documentary or some sort of educational film, but something to teach kids about American history. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  In 1775, Thomas Jefferson and John Quincy Adams set sail across the Delaware River to tell the King of England that they had had enough of his liberal agenda. 

King James called Napoleon, and together decided to kill America.  They sent the Nina, the Pinata, and the Santa Maria to fight.  But then George Washington and Abraham Lincoln gathered an army to turn back the big government dictators. 

They told Paul Revere to ride his horse to Frodo to tell him to cast the ring of power into the fires of Mount Doom. 

But then John Wilkes Booth showed up and killed Lincoln.  But there was still hope, because Jesus appeared on the face of Liberty Bell.  And he froze John Wilkes Booth in carbonite.

And the liberal homosexual sailed back to their gay countries, while Americans claimed their land and drank beer.  And that‘s how freedom was borned. 

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GLENN BECK, FOX NEWS ANCHOR:  For those members of the media who are celebrating, I waited for a season.  I know exactly where I‘m going.  And you will pray for the time when I was only on the air for one hour every day. 

(END VIDEO CLIP)

O‘DONNELL:  That was Glenn Beck on the final episode of his Fox News show today, doing his best to sound triumphant in a finale that Fox News President Roger Ales has more than implied was forced on Beck. 

Beck leaves Fox News far wealthier than when he arrived.  He still has a financially successful radio program, and now plans on expanded Internet presence.  I have sharply disagreed with and sometimes condemned Glenn Beck on all sorts of things, especially his phony manipulation of Biblical interpretations, an area that most of his critics avoided, perhaps understandably because they were more incensed by his political interpretations.

Beck critic though I am, I do try to resist the temptation of kicking someone on the way out the door who is leaving peacefully.  So I leave the attack on Beck to others tonight, and simply offer this review of the last two and a half years of the Fox version of Beck that the country has managed to survive. 

(BEGIN VIDEO CLIP)

(BARKING)

(LAUGHTER)

BECK:  Just in case you have been watching all week and you haven‘t been frightened yet, oh, you will be.  You will be.  This? 

This president I think has exposed himself as a guy, over and over and over again, who has deep-seeded prejudice for white people or the white culture.  I don‘t know what it is.  He is a racist. 

I‘m not saying he doesn‘t like white people.  I‘m saying he has a problem.  He has a—this guy is, I believe, a racist.

OBAMA:  To fight for reforms that will reign in the special interests and to fight for policies that -- 

BECK:  What planet have I landed on?  It‘s like the damn Planet of the Apes. 

The president is surrounded by Communists and Marxists. 

Obama wants to legalize the illegal aliens.  When unemployment i8.5 percent, so what does Obama do?  He says, I‘m just out of stuff to do.  What else could I possibly do to the American people? 

They are marching us to a brand of non-violent fascism. 

Nazi tactics are progressive tactics.  We call them progressives now, but back in Samuel Adams‘ day, they used to call them tyrants.  A later, I think they were also called slave owners. 

There is a strange alliance between the left and the Islamists that we are seeing.  I think it‘s all part of the coming insurrection.

The most important aspect to understand is this is not spontaneous, and it will cascade throughout the Middle East.  I hope to god not, but I bet it touches Europe and then the world.  It will not have a singular ideology, but it will mean revolution, destruction, and change.

And it will be led by young people, because anyone over 30 knows that chaos doesn‘t usually lead to anyplace good. 

The radicals that you and Washington have co-opted and brought in wearing sheep‘s clothing—change the poes (ph), you‘ll get the N‘s—you‘ve been using them. 

They believe in communism.  They believe and have called for revolution.  You‘re going to have to shoot them in the head.

So Speaker Pelosi, I just wanted—you going to drink your wine?  By the way, I put poison in it.  No, not really. 

Look, this is not a conspiracy theory.  Do you really believe that I could or anybody here at Fox News could just make things up and remain on the air? 

If I get out of control and start leveling baseless charges that can‘t be backed up, guess what happens?  I‘m fired.  I lose my job. 

I believe we‘re approaching a last call.  All aboard God‘s train, buckle up, because trouble is coming.  Get behind the shield of God. 

I told you to buy gold.  Maybe you should buy some gold. 

As I was duping people into buying gold. 

I‘m not real popular I hear in Egypt. 

I get it.  I‘m Glenn Beck.  It‘s New York City.  I‘m used to getting comments. 

I am not a journalist.  I‘m just a guy who cares—I‘m sorry.  I‘m just a guy who cares an awful lot about my country. 

You are the secret.  You‘re the answer.  I‘m sorry.  I just love my country.  I fear for it. 

I told you for weeks you‘re not alone.  I am turning into a freaking televangelist. 

America, I‘m going to shoot straight with you.  I think I have wasted your time. 

(END VIDEO CLIP)

O‘DONNELL:  And just to prove that it really is over, here is Glenn Beck‘s actual exit from Fox News. 

(BEGIN VIDEO CLIP)

BECK:  First of all, Sharkey, can you bring the blinds up?  We‘ll leave it the way we found it.  It is not the person that is leaving the parade.  It is not the person on the stage that gets all the credit.  It is all the people behind them. 

It‘s all the people that have made this possible from the very beginning.  They don‘t usually run credits.  We wrote them on a chalkboard.  I thought that was appropriate. 

From New York, good night, America. 

(END VIDEO CLIP)

O‘DONNELL:  And there you have Glenn Beck‘s LAST WORD on Fox News. 

“THE RACHEL MADDOW SHOW” is up next.  Good evening, Rachel. 

END   

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