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Msnbc Live at 6 p.m. ET, Friday, July 8, 2011

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Guest Host: Al Sharpton

Guests: Jared Bernstein, Rep. Peter DeFazio, A.B. Stoddard, Ryan Grim, Rep.

Jan Schakowsky, Christina Bellantoni, Victoria DeFrancesco Soto, John

Feehery, Ilyse Hogue

REV. AL SHARPTON, GUEST HOST:  A wake-up call for the economy.  It‘s about jobs, not cuts!

Tonight, we know the Republican agenda is driving the economy off the cliff.  And now is the time to change the conversation in Washington.

And debt fight—does President Obama have a secret plan to get a deal?

Plus, Michele Bachmann‘s attempt to go mainstream is over.  Her sickening true colors came out today.

And Murdoch‘s mess, his phone-hacking scandal deepens.  Can he survive it?  What does it mean for FOX News?

Welcome to the show.

           

Tonight‘s lead: we need to stop having the wrong conversation on jobs.  The new jobs numbers came out today.  And they aren‘t good.  Unemployment hit 9.2 percent.  And if we needed any more proof, here it is again.

The Republican approach of tax cuts and huge spending cuts is all wrong.  We Democrats are doing what you wanted.  But this jobs report is a wake-up call.

Your way is not working.  House Republicans have not passed a single jobs bill since they took power and they block the president at every turn.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  The debate here in Washington has been dominated by issues of debt limit.  But what matters most to Americans, and what matters most to me as president, in the wake of the worst downturn in our lifetimes is getting our economy on a sounder footing more broadly.

(END VIDEO CLIP)

SHARPTON:  We extended the Bush tax cuts in December.  Remember?  And

look where it got us.  Instead of hiring people, corporations are holding -

they are holding on to a record of $1.9 trillion in cash.  They have taken our bailouts and tax money and they‘re sitting on it.

           

So, why are Republicans pushing an agenda that hurts the economy?

Maybe because they think it will help them beat President Obama.

Here‘s Michele Bachmann on CNBC.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), MINORITY LEADER:  -- optimistic that we can find a place where we can come together.

(END VIDEO CLIP)

SHARPTON:  Well, let‘s—we‘re going to get you Bachmann.  That was not Michele Bachmann.  That was Nancy Pelosi—I can tell you that.  But we‘ll get the sound bite for you.

But let‘s remember what the top priority is.  Their top priority—the Republicans—is not the economy.  Listen.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER:  Our top political priority over the next two years should be to deny President Obama a second term.

(END VIDEO CLIP)

SHARPTON:  Now, McConnell said that.  Our top priority is to deny him a second term.  That‘s what he said.  And I argued that‘s what they are doing.

Joining me now is Jared Bernstein, former chief economist for Vice President Biden.

How are you tonight, Jared?

JARED BERNSTEIN, FORMER V.P. BIDEN CHIEF ECONOMIST:  I‘m well, Reverend.  It‘s good to be here with you.

SHARPTON:  Good to be with you.

The numbers are out.  I think that, you know, it is the most—in my opinion—the most weird attempt I‘ve seen in a while, where the Republicans start acting as though this validates their point, like we haven‘t been operating on the Republican playbook economically all along.  They‘ve got the tax cuts extended.  They are the ones talking about spending cuts.  Unemployment keeps going up.  And they‘re saying, see, it‘s you.

We‘re playing their playbook.  But what do they think, we‘re stupid?

BERNSTEIN:  That‘s the way I see it.  I mean, you‘ve got an economy that‘s starving and the Republicans are offering us a more of a fast, basically saying, completely topsy-turvy economics.  That is aggressive spending cuts at a time when we thought yesterday was a fragile economy today looks down right frail.

I mean, these jobs numbers, I was trying it find some silver lining in there—basically what we are looking for in today‘s numbers was if the May jobs result, which is already lousy, was just an anomaly.  Something that would be corrected bay better result in June.  Instead, we got the opposite.  May was marked down and June was basically nowhere.

So, the jobs machine has stalled.  And the only way to get it running again is to try to give it a little bit of fuel, some kinds of programs that are targeting jobs.  But as you suggested, as long as this town is obsessively focused on debt and deficit, the budget deficit, not the jobs deficit, it‘s very possible to get policy makers looking in the right direction.

SHARPTON:  You know, Jared, you and I have talked before.  I‘m from New York.  In New York, we have a place named Times Square.  Biggest con game in the world is Three-Card Monte where they trick you for the money where they try to get to you look under the card for the stone.

This is the Three-Card Monte game.  They‘ve got us talking about deficits and talking about spending rather than job creation.

BERNSTEIN:  Right.  That‘s where—when the president came out this morning, what he said—the little clip you played was very important.  He could have come out and said this jobs report shows why we need to continue down the path of deficit and debt reduction.  There was a little bit.  But what he opened up with was, what America wants us to focus on right now is the jobs deficit, with great urgency.

SHARPTON:  Right.

BERNSTEIN:  Now, that doesn‘t mean that you don‘t plot a path to fiscal sustainability in the medium and long-term.

But here is an important point, Reverend.  I want to get this on the record.  If you eliminate temporary jobs programs, whether it is a payroll tax holiday, whether it‘s more unemployment insurance, whether it‘s infrastructure program, and I‘ve got some good ideas that could really help a place like New York City, if you implement any of those programs and make them temporary programs that last a year or two, no impact at all on the medium term deficit.

So, anyone who says otherwise simply doesn‘t know the numbers.  And that‘s the medicine that the economy so urgently needs right now.

SHARPTON:  And I think what you‘re saying is very important for people to understand.  You‘re not talking about increasing the deficit to give some kind of immediate short-term jobs program.

BERNSTEIN:  Let me—let me give you a great exam of this.  I think you will really appreciate it.  If you look now—everybody around here talks about the deficit like they really care.  They really understand it.

SHARPTON:  Right.

BERNSTEIN:  If you look at what‘s fuelling, the long-term deficit in this country, it is two things.  Let me tell you first what it‘s not.  It‘s not the Recovery Act.  The Recovery Act is out of the picture, in a year or so, no impact at all on the medium or long-term deficit.

SHARPTON:  Right.

BERNSTEIN:  It‘s the Bush tax cuts and it‘s the wars.  Those two -- 

SHARPTON:  And those are the two things that they say they don‘t want to talk about.  It‘s off the table.  No tax going back to normal taxes before the Bush tax cuts.

BERNSTEIN:  Right.

SHARPTON:  We are not putting them on the table.  So—

BERNSTEIN:  But what they talk about -- 

SHARPTON:  It‘s not going to address the problem.

BERNSTEIN:  So, what they‘re talking about is precisely—again, it‘s all upside down.  It‘s almost like everything you hear these guys say, you have to turn it upside down to get it right.  What they‘re saying is, it‘s the spending on jobs, it‘s the stimulus—the temporary spending that gets into the system, helps it out and gets out.

It‘s this long-term permanent stuff—the Bush tax cuts and wars, the prescription drugs and stuff that goes on, the credit card.  That‘s what‘s driving the deficit.

SHARPTON:  Yes, they‘re not—they continue to change the language in the conversation, because we‘re not talking about raising taxes.  We‘re talking about stopping the cut in taxes that the wealthy have and just going back to taxes as they were.  That‘s not a tax hike.  That‘s stopping tax deductions.

BERNSTEIN:  That‘s an interesting point, Reverend, because, actually, if you go back a few years, every one of these Republicans voted for precisely that tax increase.  That is they voted for the Bush tax cuts to sunset back in 2010.  And, you know, that was to squeeze it into the budget window.  So, yes, I agree with your point.

SHARPTON:  Jack Bernstein, thanks for your time tonight.

BERNSTEIN:  My pleasure.

SHARPTON:  Joining me now, Congressman Peter DeFazio, Democrat from Oregon.  He‘s a proud member of the Progressive Caucus.

Thank you for joining us tonight, Congressman.

REP. PETER DEFAZIO (D), OREGON:  Thanks.

SHARPTON:  One idea that‘s been floated in debt talks would actually cut Social Security over time by adopting a new inflation measure at age 65.  This would amount to an annual deduction in benefits of $130 by age 75, $560 by age 85, and I think $984 by age 85.

Would Democrats stand for this, Congressman?

DEFAZIO:  Absolutely not.  Look, first off, seniors haven‘t gotten on Social Security haven‘t gotten the cost of living increase in two years because the formula is already defective.  It doesn‘t measure things they have to purchase, like medical care, pharmaceuticals, their essentials, rent, fuel.  Those things aren‘t measured.  It‘s consumer products—you know, just like did they get the iPod, you know, the new iPod?  Did they get the new iPad?  Did they get the new G4 phone?

You know, whatever.  They don‘t buy that stuff.  They are struggling to do essentials.

So, we are already in trouble.  They should have a special index for seniors because they have different purchasing patterns.  And if we go with this new so-called chained CPI, it will stick it the most to those who can least afford it.  That is seniors who are most dependent upon Social Security will see their cost of living adjustments go way again, or they‘ll see them be much smaller in the future.

And there a pretty good consensus in the Democratic Caucus today, we‘re not going there.

Social Security didn‘t cause this problem.  Remember, until this year, Social Security didn‘t get a penny from the general fund.  And the only reason they got money from the general fund this year, borrowed money, is because of the Obama tax holiday for Social Security.

SHARPTON:  Right.

DEFAZIO:  So we had to borrow the money to replace it.

Social Security owns 30 percent of our debt.  Social Security didn‘t cause this problem.  We don‘t need to cut Social Security.

SHARPTON:  But why do we continue to have conversations, Congressman, about things that don‘t address what we are talking about?  Social Security didn‘t cause the problem, it won‘t affect the deficit.  We are talking about deficit and spending when we are losing jobs.

I mean, why are we allowing people to change the conversation to other than what is needed to deal with the problems?

Look at this graph put up.  What is more important?  Sixty percent of the American people are saying, keep Social Security and Medicare benefits.  Thirty-two percent say reduce the deficit.

I mean, the American people seem to get it.  What‘s going on in Washington?

DEFAZIO:  Well, I fear the Obama administration has bought into too much of the Republican rhetoric here in some sort of weird triangulation move.

You know, they are talking about—I had a conversation with Furman, his deputy economic advisor.  I said, look, you‘re proposing to continue the Social Security tax holiday 15 bucks a week to everybody who‘s working.  OK, a lot of people can use the money.

But it‘s incredibly expensive and who does it put to work?  If you borrow the same money you put into the Social Security trust fund to make it whole, you could put about 4 million or 5 million people to work rebuilding the crumbling infrastructure of this country.  And it‘s not just construction.  It‘s engineering.  It‘s manufacturing.

SHARPTON:  Right.

DEFAZIO:  It‘s services.  It‘s small businesses.

It‘s all across the economy.  It‘s a proven way of putting people to work.  And he says to me, “Oh, we can‘t do that.”  What do you mean we can‘t do it?  There‘s a lack of will here.  Not a lack of capability.

SHARPTON:  Bu where are the congressmen?  Where are the Democrats in the Congress?  Why aren‘t your colleagues standing up and dramatizing this and confronting this whether you have the votes or not?  Where is the outrage on the floor of the House?

DEFAZIO:  Well, I‘m pretty outraged a lot on the floor, Reverend, if you‘ve been watching me.  And yesterday, when the Republicans proposed to cut—cut—investment the nation‘s infrastructure by 35 percent, putting another 500,000 construction workers and associated workers out of work next year, you know, we the Democrats, held a press conference, got in their face and said, you people are nuts.

You know, our bridges are falling down.  Our highways are crumbling.  You know, our transit systems are killing people because we‘re under investing.  We need to be investing like every other of our competitor nations in those areas.

So, no, we‘re there.  But I got to tell you, other than your show, or MSNBC and a few others—they don‘t want to cover us.

SHARPTON:  Well, that‘s I‘m glad the Progressive Caucus is also going out on the road.  We need to really raise our voices and speak out.

Thank to you Congressman Peter DeFazio.  Thank you for your time tonight.

DEFAZIO:  Thanks.

SHARPTON:  Ahead, in the fight over the debt, who will blink first? 

Is there a secret plan in the works?

Plus, the real Michele Bachmann is back.  Wait until you see the disturbing positions she just indulged.

And Rupert Murdoch is feeling the heat.  Can the FOX News empire and Rupert survive the phone hacking scandal?

(COMMERCIAL BREAK)

SHARPTON:  Nancy Pelosi goes one on one with the president today.  But is Social Security still on the table in the debt talks?  That‘s next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PELOSI:  Some level of optimism that emerged from those meeting to enable at least us to schedule there—the president to schedule a meeting on Sunday, late in the day, to see where we are on something that would have the elements of—in their words—grand bargain.  I wish we could be thinking about a grand vision, but whatever you want to call it.

(END VIDEO CLIP)

SHARPTON:  That was Minority Leader Nancy Pelosi earlier today, sounding less than enthusiastic about the grand bargain being negotiated with Republicans.

She spoke after a meeting at the White House and she spoke after her meeting with Democrats that was described as lively.  Here you can say that again.

For more on that and where they stand on both sides heading into this weekend of negotiations, let me bring in my next guests.

Joining me now is editor and columnist for “The Hill,” A.B. Stoddard.  Also with me is Washington bureau chief for “The Huffington Post,” Ryan Grim.

A.B., let me ask you, how spirited and how provocative in some of the positions was the Democratic meeting that the former speaker or Minority Leader Pelosi came out of with that statement?

A.B. STODDARD, THE HILL:  Well, the minority leader and former speaker is in a little bit of a tough spot because she is glad for the meeting with the president and wants to be at the table for these negotiations and be a part of the process, like she was not when the president agreed with the Republicans in December to extend the Bush tax cuts.  And she was not in the spring and April when Republicans and the president negotiated to cut a deal on fiscal 2011 budget.

And so, at this point, she‘s glad to be included.  She—as you saw -

is trying to be in wait-and-see mode for Sunday.  But she‘s made it perfectly clear that Medicare and Social Security should be on what she calls a separate table.  She doesn‘t want any cuts to beneficiaries and she‘s really trying to remain the champion for the Democrats of those programs.

           

And so, what you‘re going to see in days to come is whether there are specifics coming out of the White House that she has to say no to and put her foot down on.  At this point she is trying to -- 

(CROSSTALK)

SHARPTON:  Well, Ryan, you‘re nodding head.  What does the nod mean? 

Are you agreeing or what do I interpret by your nod?

RYAN GRIM, HUFFINGTON POST:  This was—you‘re right, that this is a very, very lively meeting that Democratic Caucus had today.  They had a lively meeting yesterday among the whip team, the members of the party that are in charge of keeping everybody together.

There was—you know, there was a moment where Pelosi and Hoyer seem to be disagreeing about how firm to stand on Medicare and Social Security.  And Donna Edwards and some of the other liberals kind of aggressively challenged Hoyer on that.  Today, Donna Edwards actually apologized to Hoyer, said I apologize for the tone but not for the substance of what was said.

SHARPTON:  Right.

GRIM:  You know, they are very unified publicly, the House Democrats.  And that‘s important.  And people try to forget the House minority, because normally, the House minority doesn‘t matter.  But Boehner is going to need 60, 70, 80, 90 Democrats because you know, there are probably more than a hundred Republicans won‘t vote for the debt ceiling no matter what‘s in it.  It‘s going to eliminate the government and they wouldn‘t vote to raise the debt ceiling.

SHARPTON:  If that‘s problem with those hundred Democrats—hundred Republicans, pardon me, that won‘t vote for the debt ceiling no matter what, is it a fact that there may not be the willingness to cut a deal no matter what on the Republican side of this?  And maybe the strategy of the White House and the president is, to put everything on the table and force them to say, no, no matter what you do, we don‘t want to anyway—which will really make the American public understand, these people don‘t care about running the country or default.  It‘s about ideology.  It‘s not about the economy.

GRIM:  Yes, the White House would be happy with that result, because then they would appear like they are the adults and that the Republicans were the children and that they are hard line and that they are extremists.

But the White House, remember, I think they would be very happy to strike this grand bargain, as they are calling it, as Pelosi derisively called it.  I think the White House would love to get the $4.5 trillion in deficit reduction.

So, I think while they‘d be happy for this kind of political win, they‘d like the policy win.  So, if they have to do it with just 120 Republicans and 100 Democrats, they‘ll do it.  But how you meet that balance is going to be tricky.

SHARPTON:  But, A.B., isn‘t it not true that the Republicans do not want even with Mrs. Pelosi saying the grand bargain and trying to pooh-pooh it, they really don‘t want victory on the Republican side to President Obama because, at the end of the day, they are committed to his defeat.

STODDARD:  What they really don‘t want is anything that can be construed as a tax increase.  So, there are a number of Republican who will not vote for any deal no matter what, unless it‘s comprised solely of spending tax cuts and doesn‘t touch taxes.

And that kind of purist outlook is going to be a huge challenge for House Speaker John Boehner.  There are going to be member who will not, even if it‘s closing loopholes for corporate fat cats, things that are indefensible in this day and age, even in the Tea Party, these people are going to say—there are going to be people in the conference who say, that in the end, is a tax increase on somebody and I won‘t be with you.

And that‘s a challenge for the Republican leader on the map.

(CROSSTALK)

SHARPTON:  -- because  I‘m running up against a hard break.  A.B., is there going to be a deal, yes or no?

STODDARD:  I think there‘s going to be a smaller deal.

SHARPTON:  What do you think, Ryan?  Is there going to be a deal?

GRIM:  Yes, there will be a deal.

SHARPTON:  All right, we will see.  Thank you for your time this evening.

GRIM:  Thank you.

SHARPTON:  Ahead, she calls herself, the unifier.  But wait until you see the sick pledge Michele Bachmann just took.

Stay with us.

(COMMERCIAL BREAK)

SHARPTON:  I think the Republicans have changed and had the wrong conversation—and one I know is agreeing with me on that is joining me now, is Congresswoman Jan Schakowsky, Democrat from Illinois, and a member of the Progressive Caucus.

Congresswoman, you have been saying all along, we are having the wrong debate.  We are letting them set the wrong premise.  We are about to get to a conclusion that may not address the problem.

I mean, what‘s going on here?  When we look at the unemployment numbers today, will they get it?  This is not about deficit.  It‘s about job creation.

REP. JAN SCHAKOWSKY (D), ILLINOIS:  You are exactly right.  I think the threshold problem we‘ve had is that the Republicans have gotten way with creating the idea that worst problem that this country faces, the biggest crisis is that we have a debt and a deficit.

Now, look, we need to address that down the road.  But right now, it‘s all about jobs.  And frankly, Al, jobs equal deficit reduction.  Then people can go out and spend money and they can pay taxes.  And what businesses need are not more tax cuts, they need more customers.

SHARPTON:  See?  That is exactly right.

SCHAKOWSKY:  And the only way that happens is if people are working.

SHARPTON:  Krugman said today in his “New York Times” piece that the reason businesses are not spending money is they don‘t have enough customers.  It‘s not about they need more tax cuts.

The thing that is amazing congresswoman is that we‘ve had these tax cuts.  We are in the tax cut, tax cut, tax cut mode.  It hasn‘t worked.  Unemployment is going up.

How did you keep prescribing the patient the same medicine, the patient gets sicker, and you write out a new prescription for the same medicine?

SCHAKOWSKY:  You know, the Progressive Caucus had a jobs listening tour around the country and I feel like I‘m looking at the middle class disappearing, the American Dream going down the drain.

But we are not helpless in the face of these unemployment numbers.  We can hire more people.  I think we need an expansive jobs bill in this country.  And we need to actually be spending more money in order to reduce the deficit.

It‘s really quite simple.  It‘s economic 101.  Put people back to work.  Then build our economy.  And down the road, when it‘s time, we do need it look at structural ways that we reduce the structural deficit.

I was on the president‘s commission on deficit reduction.

SHARPTON:  Right.

SCHAKOWSKY:  I agree that it‘s an issue.  But even the Bowles-Simpson commission said we don‘t want to threaten this fragile recovery by cutting spending too quickly.  Well, now is the time.  I hope on Sunday when they get together, at the White House, that there‘s a shift from this obsession about debt reduction to job creation.  

SHARPTON:  Right.  And I think that you make an important point.  Because none of us are saying that does not—that doesn‘t need to be some down the road look at structural balance and dealing with the structural problems that causes the deficit and we are going to run out of money in some of these programs.  But the immediate concerns will not be addressed unless we deal with job creation and millions of Americans need us to do that.  Was that the feeling in the room today when the democratic caucus met you in that room, that Ms. Pelosi was in?  What can you tell us was the feeling in n that room?  And what strategy did the Democrats have to get the conversation back on track?

SCHAKOWSKY:  You know, there‘s tremendous resentment that the Republicans are holding hostage raising the debt ceiling.  That they are willing to create a default crisis.  In order to get their way, to continue these devastating cuts.  Including of course, Medicare and Social Security.  You know, under the Bush administration, seven times in eight years, we raised that debt ceiling.  We didn‘t hear a peep. 

SHARPTON:  Not one word.  

SCHAKOWSKY:  Out of those Republicans.  

SHARPTON:  Not one word.  

SCHAKOWSKY:  Not one word.  And of course there is enormous concern about creating new jobs.  And there are many different ideas.  But I tell you what, mine is, if you think we need more people at work, then we should hire them.  And I don‘t think that that‘s some sort of a dirty word or you know, too big government.  Because there‘s plenty that needs to be done in this country.  We need to fix schools.  We need to fix sewers and water systems.  We need to hire more healthcare workers and child care workers.  And that‘s exactly what we should do.  This is back. 

SHARPTON:  We need to build the infrastructure.  We need to build highways, tunnels.  Look at traffic you‘ve got to go to in Chicago just to get to the show.  Representative Jan Schakowsky, thanks for your time tonight.  Have a great weekend.  

SCHAKOWSKY:  Thank you, Al. 

SHARPTON:  Up next, Michele Bachmann takes another big step to the right.  And falls off the deep end.  Is she taking her campaign down with her?

And the party of the rich is having some money problems.  Stay with us.  

(COMMERCIAL BREAK)

SHARPTON:  Welcome back to the show.  Now to discuss some of today‘s biggest political stories, we bring on our Power Panel. 

Joining me now is Christina Bellantoni, associate politics editor at Roll Call.  Victoria DeFrancesco-Soto, an assistant professor Political Science at Northwestern University, and republican strategist John Feehery. 

Our first question, Michele Bachmann, legitimate candidate or fringe player?  Bachmann released a new ad in Iowa this week in which she calls herself the unifying choice that will beat Obama.  But on that same day, she became the first republican to sign the family leaders‘ crazy candidate plug.  It‘s anti-gay, anti-choice.  And it suggests African-American children born into slavery were better off than those born today.  John, is she trying to have it both ways?

JOHN FEEHERY, REPUBLICAN STRATEGIST:  Well, Reverend Sharpton, she is someone who has always been a candidate that would unify the right wing of the party.  She is a social conservative.  She‘s never run away from that.  And she was to win Iowa to give her spring board to the rest of the primary states.  So, really, it doesn‘t surprise that she would sign a document that puts her, unifies her with the right wing of the social conservative movement in Iowa.  I mean, that is not a surprise at all.  

SHARPTON:  So you‘re saying on national television that the right wing of the Republican Party believes that blacks were better in slavery, that children born than they are today.  And what she said about them being born with two parents and raised by mother and father in slavery, let me put the quote up because I want you to be very clear on what you‘re saying that they believe it. 

“Slavery had a disastrous impact on American families yet sadly a child born into slavery in 1860 was more likely to be raised by his mother and father in a two-parent household than was an African-American baby born after the election of the USA‘s first African-American president.” 

Now you are ware in slavery, many parents were sold to different states and never saw their kids again.  It was against the law for kids to be named after their father.  Are you going to stand by that statement?

FEEHERY:  No, I would not stand by that statement.  I don‘t - I didn‘t sign the pledge, Reverend Sharpton.  I think that that kind of statement right now is needlessly divisive. 

SHARPTON:  What does it say about Bachmann that she signed the statement, John?  What does it say about Bachmann that she signed the statement to you, Victoria?

VICTORIA DEFRANCESCO SOTO, NORTHWESTERN UNIVERSITY:  You know, and the statement, if you read it, it also denounces Sharia Islam and it includes stuff about the economy.  So, it is this kind of catch-all pledge about, you know, making the stand with conservatism.  And I don‘t know what to think of these pledges.  We saw the abortion pledge and now we see this pledge.  They could be important in helping frame republican voters.  You know, it is an informational queue that they look to.  But I get this answer, we‘re going to see a bunch of other pledges.  And it‘s just going to become nonstarter, they‘re not going to become important.  So, she did this now in the hopes of standing out and cementing her lead.  But I really think it‘s going to be useless at the end of the day. 

SHARPTON:  Christina, if she becomes a major player, if she comes out of Iowa, a winner or second, and she is taking pledges like this, does she not hurt the mainstream Republican Party and becomes what conservatives like Brooks started fearing.  

CHRISTINA BELLANTONI, EDITOR, ROLL CALL:  This is just another quiver in the herald that democrat would use against her.  Would she ever to become the general election nominee.  I mean, this is a woman who truly believes in many, many social conservative ideals.  And she‘s signing a pledge, that doesn‘t really matter.  She is incredibly socially conservative.  The actual language of this pledge, I‘m sure she signed many things that Democrats would say are out of the mainstream for the general electorate.  So, you‘re going to see this come up or she ever going to be a general election candidate.  Now, that‘s a big question.

SHARPTON:  Well, it‘s not only the mainstream.  It‘s not factually correct.  But let me ask this, next, Tim Pawlenty‘s political obituary.  Premature or not?  I mean, he‘s headed to meet the press this weekend.  But Tim Pawlenty hasn‘t been getting much good press lately.  Today, in New York Times, will a republican race first be the first out?  And Bloomberg sees doom and gloom in his future.  And he‘s not doing too hot on fund-raising either.  Christina, does he still have a shot?  Look at his fund-raising.  

BELLANTONI:  Of course he has a shot.  And I think if any candidate‘s whose political obituary had been written in a lot of the major papers, you know, didn‘t jump out of the race, this is going to be a surprise, right?  Because you‘ve seen so many candidates written off and then come back.  You know, there are lots of different factions that play here.  A lot of different elements and yes, he‘s had a lot of trouble fund-raising.  And I think that Bachmann has taken away a lot of his support and potentially his opportunities in Iowa.  But he is not going away.  

SHARPTON:  He may have a shot, John.  But this has got to be very disappointing, doesn‘t it? 

FEEHERY:  Well, he‘s been running for a long time.  He‘s had a hard time coming up with a coherent message that actually catches fire with the primary voters.  And I think that he has a little bit—he is not raising so much money.  There‘s not much enthusiasm for his campaign.  He‘s got a very compelling personal life story that he hasn‘t really shared in a compelling way.  And I do think that if he wants to catch fire, he is going to start doing a pretty quick, you know, we are getting a pretty close to the primaries now.  

SHARPTON:  I mean, Victoria, what can do?  I mean, was his moment at the debate?  I mean, what can he do?

SOTO:  You know, he lacks charisma.  And I‘m not saying that if you‘re a boring candidate that you‘re not a strong candidate.  But right now in the middle of the Republican Party is, this search for charisma and right here in Texas where I am, we‘ve got a candidate who has a lot charisma.  He hasn‘t announced yet but the buzz is that Perry is going to jump in.  And once Perry jumps in, you are going to see a folks like Tim Pawlenty just fall to the way side.  You know, he has that ability to raise money and in addition to that, he has the charisma.  So, T-Pawl is the first to announce but I think that he‘s going to be the first to pull out too.  

SHARPTON:  I mean, I think, you know, I ran in 2004.  I think his moment was the debate.  You‘ve got to take your shot.  And I don‘t know if he was listening to advisors that told him to try it to act to above the fray and that he missed his opening.  I don‘t know what it is.  But he had a clear shot to define himself that night.  He didn‘t. 

Finally, let me ask this though.  I‘m going to run out of time.  I want to know why the 2012 Republicans are saying show me the money.  The center for responsibility politics say candidates raise a combined $35 million through June 30th.  Well, look at this, four years ago republican hopefuls already had more than $118 million.  Victoria, doesn‘t that show how unexcited even the GOP donors are with this current field?

SOTO:  Well, I think that there is a possibility of in the 2012 Republicans, just raising the white flag, and saying you know what, we‘re going to sit this one out.  We‘re going to not waste our money.  We‘re going to wait until the 2016.  Let‘s focus on our farm team.  Let‘s focus on the congressional elections because right now the field is so fractured and it is moved so much to the extreme because of the Tea Party movement.  So, any kind date that comes out of the primary is not going to become competitive in the general.  And then Obama has oodles of cash and he is a great campaigner.  

SHARPTON:  You agree with that Christina?

BELLANTONI:  I don‘t necessarily agree with that.  Because I think, look at for example a pro-Romney pack, super pack raised $12 million in the first six months of the year.  Crossroads GPS Karl Rove‘s, you know, outside group that is allowed to raise unlimited sums of money has already spent millions and millions of dollars targeting Barack Obama in key states for the general election.  There‘s going to be a lot of money spend, a lot of Republican money thrown around.  Whether these candidates can raise it, that said a little bit of something about the field but there‘s going to be plenty spent in 2012.  

SHARPTON:  John, so you think that we are looking at it the wrong way.  We‘re looking at the candidates‘ money and the real money is going to be in other ways that not a Supreme Court decision recently has opened up for there to be other ways to raise a lot of money that can impact the elections.

FEEHERY:  I think there‘s a couple of things going on.  First of all, I think that people are trying to hang on to their money because the Obama economy has made a lot of GOP donors little light in the wallet.  And I also think that they are waiting to pick the candidate who is going win.  I don‘t think there is any real passion for any of these candidates.  And so, they want to pick a winner, so there is a whole lot of the money to—it becomes clear who the winner is going to be.  And I think that that‘s really had an impact on giving. 

SHARPTON:  Do you give Obama, economy made the GOP donors light in the

they‘re the only ones.  They made all of the big recovery.  Is everybody else who—I think you got your constituencies mixed up.  

FEEHERY:  Everybody is hurting.  

SHARPTON:  No, the rich guys are doing very well.  I don‘t understand.  You are arguing about keeping your corporate jet, so you don‘t have taxes there.  You are arguing about, you don‘t want to pay taxes on the state tax.  You don‘t want to bring back the taxes.  I mean, why don‘t you guys quit laying around on corporate welfare and stand up and lift yourself by your boot straps like every other American?  

FEEHERY:  You know, what, I think they are holding on their money because they are afraid Obama is going to take it.  That‘s the real problem they‘ve got.  

SHARPTON:  No, they are afraid they‘re going to have to share with the rest of the American people like the rest of the American people have been forced to share.  Christina, Victoria, John, thank you for a great panel.  Have a good weekend.  

FEEHERY:  Thanks.  

BELLANTONI:  Thank you.  

SOTO:  Thank you.

SHARPTON:  Ahead.  Rupert Murdoch is facing the biggest crisis of his career.  What does that mean for FOX News?  That‘s next.                            

(COMMERCIAL BREAK)

SHARPTON:  Rupert Murdoch is facing the crisis of his career.  Many are talking about how he has had to close his most profitable paper in England.  But is the same method, the same m.o. of Murdoch‘s journalism being used in the United States where he‘s got waivers to own, television newspapers in the same city?  Is the trouble coming across the Atlantic?  And what will it mean for FOX News?  That‘s next. 

(COMMERCIAL BREAK)

SHARPTON:  It‘s the story that Rupert Murdoch wishes would just go away.  The media mogul and his empire are under attack for the British tabloid, phone hacking scandal that forced him to shut down his largest newspaper, sparked a government investigation, and unleashed a flood of anger from the public.  Now the scandal is turning the spotlight on Murdoch‘s media empire here in the U.S. especially on to FOX News.  So what does the controversy tell us about how Murdoch does business?  And what will the scandal mean for FOX News?

Joining me now, is Ilyse Hogue, senior advisor at Media Matters, a nonprofit Watch Dog Group that is now under attack from FOX News.  Elise, how are you?  And welcome to the show. 

What does this mean in America?  Of course, we know in England, there is a lot of outrage.  In parliament there.  There‘s unprecedented attacks.  But what could this mean in the United States and particularly for FOX News?

ILYSE HOGUE, MEDIA MATTERS:  Well, you know, the first thing I think Americans need to realize Reverend, is that news international is a part of news corps, which is a U.S. listed company.  And we have kind of had it over here with unaccountable U.S. companies, right?  It led to the economic down fall of our country.  And so, I think Americans need to start looking very hard at the deeper mismanagement that systemic through news corps and start asking the questions about whether the lies that we hear every day on FOX.  The lies that come from the senior management at FOX, pervade through the rest of Murdoch‘s empire, the Wall Street Journal, New York Daily News or whether or American citizens have been spied on as well.  

SHARPTON:  Now, is this in your opinion and the opinion of Media Matters, a way that management has a style of journalism?  Is this an isolated incident in terms of one paper in England?  I mean, one has to question what is going on here with him giving up an entire paper on this.  So, is this widespread throughout his operations and your opinion, and that opinion of Media Matters?  Is this isolated?  Or you don‘t know yet?

HOGUE:  No, look, I think we know enough.  They started with a rotten apple, that‘s one rogue journalist, right?  Obviously when you‘ve got 4,000 cases of citizens whose privacy has been invaded, that‘s more than one rotten journalist.  In fact, now they are saying, oh, this was just our institution.  The closing of news of the world raises more questions than it actually answers.  And we have definitely seen this style of management all the way through Murdoch‘s empire.  This is man who‘s known for putting his personal and political agenda ahead of public welfare.  And quite honestly, ahead of shareholder value as we saw when he shut down one of his more profitable ventures with no warning.  

SHARPTON:  Now, was that closing down of that venture a surprise, something that no one succumbing?  And if so, then what other things do you think would happen if he had to avoid certain situations here in the United States?

HOGUE:  Well, I mean, I think everybody was shocked with the abrupt closing of “News of the World.”  Most of all, the employees who had nothing to do with the scandal that were laid off of their jobs immediately.  And the people, most accountable are so in their positions.  I mean, one of the things folks have to realize here in the U.S., in terms of direct connection, is the man who was originally responsible at “News of the World,” Les Hinton, who concluded in our first investigation that no wrongdoing had happened.  He was then promoted to be the CEO of Dow Jones which runs the Wall Street Journal.  The man who actually either neglected to see the extent of the wrongdoing in the UK or at best knew about it and swept it under the rug, now controls one of our most vetted newspapers in our country.  We‘ve got to be asking the questions.  We can‘t wait until the scandal boils over here like it did in the UK before we do our due diligence.  

Ilyse, thank you very much for joining us tonight.  

Ahead, Republicans in a state of confusion.  When it comes to rights. 

That‘s next.  

(COMMERCIAL BREAK)

SHARPTON:  This weekend, we will see on Sunday what some have said is a showdown.  But what I want you to think about as you watch this, the showdown is more than just about parties.  It is even more than about how we approach the economy from different vantage points.  I think we are seeing something really deeply here that a lot of Americans have not had to think about or realize.  And that is, there‘s a fundamental disagreement that goes back way before President Barack Obama took office.  Way before the Tea Party. 

There‘s always been a dispute between how this country is governed.  Whether it is governed by a strong central national union that will protect all of the citizens or whether it‘s governed, state by state.  We are looking at a resurgence in my judgment after state‘s rights movement.  It is a little more polished.  It is a little more sophisticated.  It doesn‘t call itself that, but that‘s what it is.  Well, I take that back.  Because sometimes if you listen carefully, they will tell you that.  Listen to the star of the Republican Party, Governor Rick Perry.  What he had to say. 

(BEGIN VIDEO CLIP)

GOV. RICK PERRY ®, TEXAS:  The idea that they‘re telling us how to educate our children or how to deliver healthcare or how to, for that matter clean our air is really nonsense.  If you really want to get America back to this vibrant economy, then respect the tenth amendment.  Allow the states to be the laboratories of innovation. 

(END VIDEO CLIP)

SHARPTON:  Allow them to be the laboratories of innovation.  Tenth amendment.  The tenth movement.  The states‘ rights movement.  Oh, he wasn‘t clear?  Well, let him clear it up.  Listen again.  

(BEGIN VIDEO CLIP)

PERRY:  Texas is a unique, when came in the union in 1845.  One of the issues is that we would be able to leave if we decided to do that.  If Washington continues to thumb their nose at the American people, you know, who knows what might come out of that.

(END VIDEO CLIP)

SHARPTON:  Washington should not thumb their nose at the American people.  That‘s right.  Each state should decide affirmative action.  Each state should decide immigration.  Each state should decide civil rights.  Well, I‘m sorry, I believe in something deeper.  I believe in liberty and justice for all, one nation under God, liberty and justice for all.  Thank you for watching. 

I‘m Al Sharpton.  Have a great weekend.  “HARDBALL” starts right now. 

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.                                                                            

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