updated 7/20/2011 11:35:45 AM ET 2011-07-20T15:35:45

Guests: Sam Youngman, Senator Bernie Sanders, Rep. Donna Edwards, Jane
Hamsher, Mike Papantonio, Dave Hansen, John Nichols

ED SCHULTZ, HOST: Good evening, Americans. And welcome to THE ED SHOW tonight from New York.
Breaking news from the House of Representatives: Republicans have somehow managed to pass a bill even more radical than the Ryan plan.
Meanwhile, the president is warming up to the “gang of six” in the Senate, their plan to reduce the deficit. There are major questions about taxes and possible cuts to the big three.
And in Wisconsin, we have a result in the state‘s first recall election since the Scott Walker union-busting law was passed. The Democrat, Dave Hansen, has defeated the Republican challenger—another major victory for workers rights in Wisconsin and in America.
This is THE ED SHOW. Let‘s get to work.
(BEGIN VIDEOTAPE)
(MUSIC)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We now have a bipartisan group of senators who agree with that balanced approach. And we‘ve got the American people who agree with that balanced approach.
SCHULTZ (voice-over): The “gang of six” plan rides again. Bernie Sanders gives the plan a huge thumb‘s down. He‘s here tonight.
Rupert Murdoch plays dumb in front of parliament.
RUPERT MURDOCH, NEWS CORP: I don‘t know.
SCHULTZ: Reminds me of a scene from “The Godfather.”
Mike Papantonio is here on the News Corp dog and pony show.
And, tonight, the election results everyone is waiting for out of Wisconsin. We‘ll talk to the first member of the Wisconsin 14 to face a recall election.
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SCHULTZ: Good evening, Americans. And thanks for joining us tonight.
With less than two weeks before the United States defaults on its obligations, President Obama and the “gang of six” in the Senate, they think that they have come up with a plan that might save the day. The president made a statement in the White House briefing room after a group of 47 senators were briefed on the plan by the “gang of six.”
The plan would cut the deficit by $3.7 trillion over 10 years, including $1 trillion hike in revenue. I don‘t know how the Republicans are going to go along with that. The president wants Republicans to just understand just how much he‘s giving up to get them to take the deal.
(BEGIN VIDEO CLIP)
OBAMA: Here‘s where we stand. We have a Democratic president and administration that is prepared to sign a tough package that includes both spending cuts, modifications to Social Security, Medicaid, and Medicare, that would strengthen those systems and allow them to move forward, and would include a revenue component. We now have a bipartisan group of senators who agree with that balanced approach. And we‘ve got the American people who agree with that balanced approach.
(END VIDEO CLIP)
SCHULTZ: The president understands where the American people are. Look at the numbers. “Washington Monthly” put together this chart of five most recent national polls that show more Americans want a deal with a combination of cuts and revenue increases than a deal that just has cuts alone.
The president is spot on when he asks for shared sacrifice from Americans who can afford it, but he seems to me anyway to be wordsmithing the cuts.
Take a closer look at what he said.
(BEGIN VIDEO CLIP)
OBAMA: Here‘s where we stand. We have a Democratic president and administration that is prepared to sign a tough package that includes both spending cuts, modifications to Social Security, Medicaid and Medicare.
(END VIDEO CLIP)
SCHULTZ: Ahh, the keyword is “modifications.” Just what does that mean?
As liberals, we need to know what modifications the president‘s talking about when he talks about changing, saving, strengthening the big three. There needs to be a fair trade, if there‘s going to be a trade, when it comes to tax increases and benefit cuts.
I don‘t think there ought to be any changes to the big three at all. The “gang of six” is not the most respected group in Washington. They spent the last six months trying to figure out how to decrease our debt. And most of the time, none of these guys were on the same page.
The president—that he go out and get all excited about the “gang of six,” but still has to deal with Republicans in the House. And earlier tonight, the House passed the Tea Party‘s “cut, cap and balance” bill with the president not wanting any part of that at all.
(BEGIN VIDEO CLIP)
OBAMA: Speaker Boehner and the Republican House caucus felt it necessary to put forward the plan that they‘re going to be voting on today. I think everyone‘s estimation is that that is not an approach that could pass both chambers. It‘s not an approach that I would sign and it‘s not balanced. But I understand the need for them to test that proposition.
The problem we have now is we‘re in the 11th hour and we don‘t have a lot more time left.
(END VIDEO CLIP)
SCHULTZ: And the Tea Party is becoming the failure crowd. If they don‘t get their “cut, cap and balance bill,” which they didn‘t, then the Tea Party will never go for the “gang of six” plan. So where does that leave us? It is crunch time, and Washington is playing a dangerous game with our economy.
The president knows what the stakes are.
(BEGIN VIDEO CLIP)
OBAMA: I think it‘s very important in these next couple days to understand we don‘t have any more time to engage in symbolic gestures. We don‘t have any more time to posture. It‘s time to get down to the business of actually solving this problem. And I think we now are seeing the potential for a bipartisan consensus around what that would take.
It will be hard. It will be tough. There‘s still going to be a lot of difficult negotiations that have to take place in order for us to actually get something done. And as I said, we have to have that fail-safe that Senator McConnell and Senator Reid are working on.
But the hope is, is that everybody seizes this opportunity.
(END VIDEO CLIP)
SCHULTZ: And there‘s a real good chance that neither of those would pass the House.
But see, the president, as I see it, along with the Democrats need to seize this opportunity and hold firm on taxes. They also need to make sure that these modifications, if there are going to be any, don‘t massive cuts to American families who are living on fixed incomes, and the government has got to live up to its obligations. They paid into this.
The president—I think he can go love this “gang of six” all he wants, he still has to play cards in the House, and he may not have the votes for modifications to the big three. In fact, the president almost disregards the House Democrats, leaving them out of the conversation, almost taking them for granted that he can peel off some of the 77 House Dems who signed the letter, telling him: hands off, no cuts.
This is high stakes poker, no doubt about it. What about just a clean bill? What about an up-or-down vote on what we should do with the debt ceiling?
Right now, the Democrats ought to be pushing big time for that, because that‘s where the American people are, OK? You can always come back and do something else.
But the tough thing about this, folks, is that this is ugly politics for liberals right now. Nobody wants to fish in our boat. Nobody likes our bait. Nobody wants our deal.
They act like we got algae on the bottom of the boat. They don‘t want us in their lake.
The liberals in this country are losing out on this whole thing. We‘ve had two wars—now four. We‘ve got Bush tax cuts, big pharma, that‘s why we‘re here—and we‘re having this big discussion about entitlements, about how they‘re the problem, when the program is paid for for the next 25 years? I don‘t think it is a fair deal.
Get your cell phones out. I want to know what you think. Tonight‘s text question: should Democrats vote for any modifications of the big three? Text A for yes, text B for no to 622639. You can always go to our new blog at Ed.MSNBC.com. Results coming up later on in the show.
For more on tonight‘s meeting, Sam Youngman, White House correspondent for “The Hill,” joins us.
Sam, good to have you with us.
SAM YOUNGMAN, THE HILL: Thanks for having me, Ed.
SCHULTZ: Tonight, your newspaper is reporting that Senator Dick Durbin, who is a member of the “gang of six,” says that their plan is not ready. He went on record saying that the “gang of six” plan has not been drafted, nor has it been scored by the CBO. It‘s not ready for prime time.
So did the president kind of jump the gun today or was he a little bit overoptimistic? How do you read it?
YOUNGMAN: Well, I think the White House is optimistic that they can despite Senator Durbin‘s pessimistic outlook on the package that they can get it scored and voted on before August 2nd. I think that might be a little bit unrealistic. I think—it reminds me of saying let‘s get health care and let‘s do it in two weeks, before you went through the drama of the committee meetings and scoring.
So, I think it is—it‘s monumental. I mean, we‘re talking about close to $4 trillion in cuts, and that takes awhile to figure out, just to dot the I‘s and cross the T‘s.
SCHULTZ: Well, it also takes a long time to figure out how the Republicans go along with $1 trillion of revenue increases, which is billions of dollars a year, where they are going to come up with $100 billion a year the next 10 years. How is that—what Republican is willing to sign onto that?
YOUNGMAN: Well, it‘s really Washington deal-making at its finest. On its face, yes, it‘s about $1.3 trillion in increased revenue, but actually CBO would score it as $1.5 trillion tax cut, because basically what you‘re talking about is abolishing alternative minimum tax and lowering the top tax rate to 29 percent. Essentially, it‘s an overhaul of tax code.
So, I think it gives House Republicans some wiggle room. But from all indications we have seen so far, they are still seeing it as a tax hike.
SCHULTZ: Sam Youngman, good to have you with us. Thanks so much for joining us.
YOUNGMAN: Thanks, Ed.
SCHULTZ: Let‘s turn now to Bernie Sanders of Vermont, independent senator, and also, Congresswoman Donna Edwards joining us tonight from Maryland.
Senator Sanders, how can the president expect the Congress to make a quick decision on $3.7 trillion in debt with very little deliberation? What do you make of it?
SEN. BERNIE SANDERS (I), VERMONT: You can‘t and you won‘t. There are two separate issues. Number one, obviously we can‘t default on our debt, it would be disaster for the country in one way or another, with Wall Street understanding how significant it is for them, we‘re into the going to default on our debt.
SCHULTZ: Well—go ahead.
SANDERS: The second separate issue is how you move forward sensibly on deficit reduction.
In my view, this “gang of six” proposal is a disaster. It lowers the
tax rate very substantially for the wealthy, and it will make devastating -
this is not modification—devastating cuts in Social Security, Medicare, Medicaid, education, nutrition. You name the program that our struggling, working class in this country desperately needs, it is going to be cut.

I would estimate if the “gang of six” proposal were ever to pass, that I will do my best to see that doesn‘t happen. It would—
SCHULTZ: It would do—what?
SANDERS: It would be absolutely devastating to working families. We have to do everything we can to rally the American people to prevent it. You‘re giving the Republicans about 90 percent of what they ever dreamed of.
SCHULTZ: Congressman Edwards, you signed on, along with other liberals in Congress, 77 of you got together and said: no cuts to the big three.
And this deal of the “gang of six” and what they‘ve come up with, there would be no benefit cuts for five years, would exempt SSI for five years. But to chained CPI and how they do calculate inflation, consumer price index—would that change your position? Are you willing to go with the president on this and take your name off that list? Or are you going to stand strong and protect the big three.
Where do you stand tonight?
REP. DONNA EDWARDS (D), MARYLAND: Well, Ed, there‘s nothing to go with, because what we got was we got a lot of verbiage about what could be done. But we are two weeks to defaulting on this nation‘s obligations. It‘s time for us to pass a debt ceiling increase.
And also, you know, to say to the American people and stand with the American people—by the polls you showed earlier, the American people want deficit reduction. They want a balanced approach. They want to make sure that they protect Medicare and Social Security and Medicaid—and I still stand by the letter that we sent to the president, and it wasn‘t just liberals that want to protect these programs for the American people because they deserve it.
And especially while there are some out there who want to give away all kinds of tax loopholes and benefits to corporations, to big oil, to millionaires and billionaires, and then try to balance the budget on the backs of our seniors, working people and the disabled? It‘s just not fair. The American people know it‘s not fair.
And as I said before, this shouldn‘t even be in the conversation.
SCHULTZ: OK. So, where are the allies that the president is going to be counting onto get this passed in the House? He may get it done in the Senate, but in the House, it‘s really going to come down math-wise to many of you that signed that letter, whether you jump with the president or if you‘re going to protect the big three.
What else could it be?
EDWARDS: Well, as I said, I think that both chambers right now, at least the Senate right now is working on a plan that would get us, you know, the cleanest possible debt ceiling increase so that we don‘t default on our obligations.
SCHULTZ: OK.
EDWARDS: And we need to focus on that. I mean, it‘s kind of ironic that this was thrown in, kind of at the last minute as a monkey wrench. But it is not ready for prime time. There is no legislative language.
There‘s no committee action.
It‘s time to—you know, take this off the table and use our two weeks to do the business of the American people.
SCHULTZ: Senator Sanders, it appears to me that the best available option right now for lefties in the country is what former President Clinton is talking about. Former president says that he would invoke the constitutional option to raise the nation‘s debt ceiling without hesitation and force the courts to stop me to order—in order to prevent default.
I mean, if entitlements aren‘t the problem what got us here with the wars, the tax cuts and big pharma, doesn‘t this really offer up the best available option for liberals?
SANDERS: It‘s an option. It‘s one I think the president has indicated that he‘s not sympathetic to it. But I think we can figure a way to pass and to raise the debt ceiling.
But I got to tell you something else, Ed. While we‘re talking about Social Security, understand that if the “gang of six” proposal were to go through, we‘re talking about immediate cuts to Social Security so that somebody today who‘s 65, when they‘re 75, would see $500 a year cut, when they‘re 85, $1,000 a year cut, and there are more proposals in there to keep Social Security solvent for 75 years—which will mean even greater cuts in years to come.
This is devastating and we should not minimize what this proposal is about.
SCHULTZ: The sound bite played earlier, the president said here is where we are, we have a Democratic president. I mean, he is emphasizing to the independents and Republicans this is a moment they might not want to pass up, at the political cost of losing his base. I find it pretty amazing.
And what about the McConnell plan along with Harry Reid? I mean, he‘s thinking that this is some kind of backup plan. Do you think that this has a chance in the Senate?
SANDERS: Yes, I do. I do. Look, you got to understand our friends in Wall Street and corporate America understand how devastating it would be to this country if we defaulted. They are now putting pressure on right wing Republicans and I think Republicans are hearing this message.
So, I think we are going to get through this immediate crisis and raise the debt ceiling.
But most importantly, what we need to do long term is engage the American people in long term deficit reduction and say you know what, we‘re not going to lower the tax rate for the wealthy, we are going to ask them to pay their fair share of taxes, we‘re going to do away with corporate loopholes, we‘re going to take a hard look at military spending which has tripled since 1997.
There are fairways to do deficit reduction and this “gang of six” proposal is not one of them.
SCHULTZ: Congresswoman Edwards and Bernie Sanders, senator from Vermont—great to have you both here tonight. Lots going on. No doubt.
Remember to answer tonight‘s question, I want to know what you think.
Next, Republican Allen West launches a brutal attack on a Democratic congresswoman.
And it‘s election night in Wisconsin. You are looking live at the Hansen campaign headquarters, the first of nine recall elections happened tonight in Green Bay.
Democratic Dave Hansen was thought to be one of the most vulnerable Democrats. Well, he won a major victory tonight, and they are dancing in Titletown. Senator Dave Hansen will join us later on, along with John Nichols. Stay with us.
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SCHULTZ: Michele Bachmann and her Tea Party buddy Steve King are using devastating flooding on the Missouri River as an excuse to rail against the Pigford settlement which involves payment to black farmers who were discriminated against by the federal government.
Here is what they had to say yesterday after going on a flyover of the flooded Missouri River, in response to a question about cuts to the Department of Agriculture.
(BEGIN VIDEO CLIP)
REP. MICHELE BACHMANN ®, MINNESOTA: When money is diverted to inefficient projects like the Pigford project where there seems to be proof positive of fraud, we can‘t afford $2 billion in potentially fraudulent claims when that money could be used to benefit people along the Mississippi River and along the Missouri River.
REP. STEVE KING ®, IOWA: That‘s $2.3 billion—a large percentage of which was paid off in fraudulent claims. Now, we have them opening up a similar one for women farmers and of Hispanic farmers. That‘s another at least $1.3 billion.
I‘d like to apply that money to the people that are underwater now.
(END VIDEO CLIP)
SCHULTZ: I agree. Flood victims should receive aid. But it shouldn‘t come out of the pockets of farmers that have been victims of discrimination.
And their accusations of fraud—flat out bogus. Bachmann and King are using the flooding as an opportunity to push their anti-Pigford agenda, and they should be ashamed of themselves.
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(BEGIN VIDEO CLIP)
REP. DEBBIE WASSERMAN SCHULTZ (D), FLORIDA: It is crucial that the American people understand that this plan would require even deeper cuts than under the Ryan Republican plan we saw in April. Incredulously, the gentleman from Florida who represents thousands of Medicare beneficiaries, as do I, is supportive of this plan that would increase costs for Medicare beneficiaries—unbelievable from a member from south Florida.
(END VIDEO CLIP)
SCHULTZ: That was Florida Congresswoman Debbie Wasserman Schultz speaking out against the radical cut, cap and balance bill that passed the House tonight.
She was calling out her fellow Floridian, Tea Partier Allen West, for his support of the flank. He responded with a letter to Democratic leadership. In it, he called Wasserman Schultz, quote, “the most vile, unprofessional, and despicable member of the United States House of Representatives.” He also called her a coward. He said she was, quote, “not a lady.” And Allen West told her to, quote, “shut the heck up.”
Joining me now is founder of FireDogLake Jane Hamsher.
Jane, Debbie Wasserman Schultz responded to that West quote saying the truth hurts, that‘s the point, right?
The cuts the GOP are putting forward really are going to hurt a lot of Americans. Why would they go down this road? And I think that exchange there that we just had really underscores just how intense this whole thing is and how divided our lawmakers are when you come to start talking about how to balance the budget and using the big three and not having any tax increases.
What‘s your take on the GOP is and what they‘re trying to do after they handed the Democrats the Medicare issue with the Ryan plan? What do you make of it?
JANE HAMSHER, FIREDOGLAKE.COM: Well, the irony is, Ed, that the Republicans are unable to control the Tea Party members. The banks want them to raise the debt ceiling and the banks, the Chamber of Commerce, pumped a lot of money into getting these Tea Party candidates elected and they can‘t control them, they can‘t get them to support anything.
So, you‘re seeing things break out between, you know, Allen West, whose comments about Debbie Wassermann Schultz were inexcusable, and the Democrats who have responsibility for passing that debt ceiling increase.
SCHULTZ: FireDogLake, you have got a liberal blog. How is President Obama fairing with people that read your material and go to your Web site, Jane? I mean, this is—this is pretty dividing stuff for the Democrats, isn‘t it?
HAMSHER: Well, today was a really bad day I would say for the president because he officially came out and backed chained CPI plan for Social Security. I think you explained that chained CPI means there will be benefit decrease for people who are currently on Social Security. It was calculated by Nancy Aultman (ph), who was one of President Obama‘s Social Security advisers on his campaign and on the transition team, that it would amount to about $1,300 a year less for Social Security recipients out over time.
So it‘s pretty drastic. Up until now, people have said, well, you know, he doesn‘t really back this, or he‘s only doing this to challenge the Republicans, but today he actually came out and backed it.
And it‘s really unconscionable to ask senior citizens, veterans, the disabled, the elderly to pick up the tab after this huge hole was punched in the deficit last year when they passed the Bush tax cuts. Basically, they are trying to makeup that money. But instead of going to banks or insurance companies, they are doing it on the backs of senior citizens—and it‘s really a bad thing and people are not responding well.
SCHULTZ: You know, given the numbers that are out there, American people feel they are willing to compromise when it comes to spending cuts.
What are Democrats—what are they going to be facing if there are entitlement cuts when they go to the polls next November? I mean, is this going to be a lingering issue for Democrats that you can‘t trust them and the basers out there are going to be frustrated and do a no-show?
HAMSHER: Well, you got to explain to me, Ed, why Mitch McConnell offered the president a deal where there were no cuts and they would do a clean debt ceiling increase and the president rejected it? He‘s the one insisting now on cuts being made. He wants to run as a guy who closed the deficit in 2012.
And the “gang of six” deal that he endorsed was fuzzy on cuts made other places, but very specific in that they were going after Social Security and Medicare.
So, they are really targeting social safety net to make up for the money that they gave away to millionaires last year.
SCHULTZ: Pretty amazing.
HAMSHER: It‘s absolutely unconscionable and it really does destroy fundamentally what the Democratic Party has stood for since Roosevelt and the New Deal.
I went to 40 House offices and I visited these members of Congress and said, our readers will not support any Democrat or any member of Congress or the president himself if they vote, if they try to cut Social Security and Medicare benefits.
SCHULTZ: And on the other side, you got the Tea Partiers on the extreme right saying the same to the Republicans in a different manner.
Jane Hamsher—
HAMSHER: You really think that it‘s equivalent, Ed? Do you really think that‘s an equivalent?
SCHULTZ: I do. I do think it is.
HAMSHER: So, you think Social Security should be cut by reasonable people?
SCHULTZ: No, I don‘t. Look, where I stand is that there should be zero cuts because this isn‘t the problem that we have right now. It‘s not Social Security, Medicare, Medicaid.
So I think that the Tea Party is not going to give the Republicans what they want. Boehner is going to eventually come in, try to cut a deal, OK?
Wall Street is talking to the Republicans, saying, dude, you guys are screwing up this economy if you do this—and the Tea Partiers if they hold the line like we had the gentleman on, Mr. Phillips last night, he says they are not going to budge.
So, I think there is an equal equivalent as to what the liberals are doing over on the far left and what the righties are doing over on the far right. We actually have four factions in all of this right now, and the president is trying to make sausage out of it all. It‘s going to be interesting.
HAMSHER: Well, I‘m glad you‘re a member of the unreasonable left with us then, Ed.
SCHULTZ: All right. Jane Hamsher, FireDogLake—good to have you with us tonight.
It was a day of apologies and denials for Rupert Murdoch. But did his testimony to British parliament have any impact on the future of News Corp?
And tonight, Wisconsin Republicans tried to take out a member of the Wisconsin 14. They were so mad at him, right, that they left the state to protect the workers. Well, guess what? They failed.
You are looking at the headquarters of State Senator Dave Hansen. He‘s keeping his job and he joins me later tonight. And John Nichols of “The Nation” tells us what the Republicans have up their sleeve now.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JAMES MURDOCH, SON OF RUPERT MURDOCH: As for my comments, Mr. Chairman, and my statement, which I believe was around the closure of the “News of the World” newspaper --
RUPERT MURDOCH, NEWS CORPORATION CEO: Before we get to that, I would just like to say one sentence. This is the most humble day of my life.
(END VIDEO CLIP)
SCHULTZ: A humbled Rupert Murdoch apologized to British parliament today over the News Corp. hacking scandal. Despite claiming he works 10 to 12 hour days, Murdoch spent most of the hearing claiming he really has very little knowledge of what‘s going on in his company. If the banks are too big to fail, then I guess Murdoch is just too big to know what the hell‘s going on.
Here is Murdoch being asked what he knew about phone hackers at News Corp after he repeatedly said the company has a zero tolerance policy of wrongdoing.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: So if you were not lying then, somebody lied to you. Who was it?
R. MURDOCH: I don‘t know. That is what the police are investigating.
And we are helping them with.
(END VIDEO CLIP)
SCHULTZ: A member of parliament asked Murdoch about one of his top executives, Rebekah Brooks, who admitted to paying bribes in 2003.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Did you or anyone else at your organization investigate this at the time?
R. MURDOCH: No.
SCHULTZ: Can you explain why?
R. MURDOCH: I didn‘t know of it.
(END VIDEO CLIP)
SCHULTZ: He didn‘t know about that one either. Murdoch‘s testimony was starting to remind me of another famous hearing. Do you remember Frank Pentangeli from “The Godfather?”
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I ask you again, sir, here and now, under oath, were you at any time a member of a crime organization headed by Michael Corleone?
UNIDENTIFIED MALE: I don‘t know nothing about that.
(END VIDEO CLIP)
SCHULTZ: I don‘t know anything about any of this stuff. I don‘t know what was going on. When he wasn‘t suffering from amnesia, Murdoch was defiant. He claimed no knowledge of huge pay outs to informants at the “News of the World.”
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Surely in your weekly conversations with the editor of “the News of the World,” something as big as that, paying somebody a million pounds, paying somebody 700,000 pounds—surely you would have expected the editor of “the News of the World” just to drop it into the conversation at some point during your weekly chat?
R. MURDOCH: No.
UNIDENTIFIED MALE: You wouldn‘t have expected them to say that to you?
R. MURDOCH: No.
(END VIDEO CLIP)
SCHULTZ: Even though he said he was sorry for the scandal, Murdoch passed the buck when it came to taking the heat.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Mr. Murdoch, do you accept that you are ultimately responsible for this whole fiasco?
R. MURDOCH: No.
UNIDENTIFIED MALE: You are not responsible. Who is responsible?
R. MURDOCH: The people that I trusted to run it and then maybe the people they trusted.
(END VIDEO CLIP)
SCHULTZ: So Mr. Murdoch wants us all to believe that he‘s the head of a global media conglomerate who has no responsibility over the decisions made by that corporation.
I‘ll break down Murdoch‘s answers with a guy who has extracted his fair share of testimony. Mike Papantonio joins me next. Stay with us.
Former oil executive, Arizona Congressman Trent Franks, is trying to score political points by exploiting soldiers buried in Arlington Cemetery. This guy is tailor made for Psycho Talk.
And in Wisconsin tonight, the Democrats have won a decisive victory over his Republican opponent in the first state‘s recall election. Workers rights alive in the Heartland. John Nichols of “The Nation,” and the big winner, Dave Hanson, join me tonight.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: This terrible thing happened on your watch. Mr.
Murdoch, have you considered resigning?
R. MURDOCH: No.
UNIDENTIFIED FEMALE: Why not?
R. MURDOCH: Because I feel that people I trusted—I‘m not saying who. I don‘t know what level—let me down. And I think they behaved disgracefully, betrayed the company and me. And it‘s for them to pay.
I think that frankly I‘m the best person to clean this up.
(END VIDEO CLIP)
SCHULTZ: Murdoch isn‘t going to resign, but his issues are getting worse. The Department of Justice today said Attorney General Eric Holder is willing to meet with families of 9/11 victims who are concerned about allegations that News Corp employees hacked into victims‘ phones.
Let‘s bring in Mike Papantonio, host of the nationally syndicated radio show, “Ring of Fire.”
Mike, great to have you with us tonight. I am still convinced that he watched “The Godfather” movie to prepare for testimony on this. Talk about patent, generic, safe answers. I don‘t know anything. I mean, that was the word of the day. What did you take out of it?
MIKE PAPANTONIO, RADIO TALK SHOW HOST: What we saw unfold today is a textbook game plan that we saw with the Enron case, the Worldcom case, the Health South case. Good defense lawyers always do the same thing.
If you took what he did today, Ed, put it next to what Ken Lay did and what Bernie Sanders did and what Richard Scrushie did, it is the same game plan because they use it universally.
Here is how it goes. We have a big company. It was so big, I didn‘t know what was going on. Or how about this. If I would have known then what I know now, I would have fixed it.
Or how about this—we heard this today: with 50,000 employees, there‘s naturally going to be a bad apple.
We also heard both James and both Murdoch use these talking points, it is somebody else‘s fault. It‘s not my fault. It is somebody else‘s fault.
Or I can‘t answer your question because I don‘t know the details. Or I can‘t answer your question because I don‘t have the knowledge. Or I wasn‘t there, how can I answer the question?
I got to tell you, this is the same thing you saw with Enron, Tyco, Health South, and so on. You know what they miss, Ed? Here‘s what they miss: they miss that they can be prosecuted for not knowing. They can be prosecuted for something called willful blindness.
That‘s where you should know; you see it happening; there‘s so much constructive information around you that you should know your company is creating a criminal type organization, and then you just ignore it. So no matter what he tried to do today, if you take and distill what he did, and put it next to a criminal defense textbook, it‘s going to look like exactly that textbook.
SCHULTZ: And James Murdoch said this about his father‘s company today during the hearing. Listen to this.
(BEGIN VIDEO CLIP)
J. MURDOCH: At the end of the day, we have to have a set of standards we believe in. We have to have titles and journalists that operate to the highest possible standard. And we have to make sure when they don‘t live up to that that they are held to account.
(END VIDEO CLIP)
SCHULTZ: So what kind of standards are they living up to over at Fox News? What am I missing here?
PAPANTONIO: Well, the standards that this committee was asking good old James about is James, why did you pay a million dollars hush money to somebody who had been a victim of this phone hacking? The problem James had was he couldn‘t say he paid a million dollars to this one victim and paid 20,000 or 30,000 dollars to everybody else, because we know that this one victim was a special case that could lower the boom on News Corp.
He knew that. That‘s why he paid the money. Then you have to ask yourself is it really believable that daddy didn‘t know that his son James had paid out the equivalent of two million dollars, as he puts it, to settle a civil suit and Rupert just doesn‘t know about that?
I got to tell you, this committee really focused on some important things. The other thing James couldn‘t answer, I thought it was important. James couldn‘t explain why News Corp paid for the criminal defense of one of their employees after the employee had been fired, after it was clear that this employee had engaged in hacking.
(CROSS TALK)
SCHULTZ: Isn‘t it just a hell of a lot easier to pay an attorney than it is to maybe run into other legal problems down the road, if the guy turns into a rat on you, right?
PAPANTONIO: I think that‘s what they were worried about, Ed. It is what they were worried about. They knew they had no contractual obligation at all to take care of this defense. They had never done it before and they‘ve never done it since.
So if you don‘t think Scotland Yard and the people who were answering these questions know something else about this story, I would be real surprised.
SCHULTZ: Mike Papantonio, always a pleasure. Good to have you with us. Thanks so much.
PAPANTONIO: Thank you, Ed.
SCHULTZ: A chicken hawk Republican uses dead American heroes to prove a stupid point about the economy. He‘ll get the special place in the Zone next.
And this is the scene in Green Bay, Wisconsin, tonight, where Democrat State Senator Dave Hansen has won his recall election, a major victory for the Democrats and workers rights in the state of Wisconsin. The state senator will join me live. Stay with us.
(COMMERCIAL BREAK)
SCHULTZ: In Psycho Talk tonight, Arizona Congressman Trent Franks hasn‘t served a day in uniform, but thinks he can speak for our armed forces. Last night, Franks claimed dead U.S. troops would side with Republicans on the economy.
(BEGIN VIDEO CLIP)
REP. TRENT FRANKS ®, ARIZONA: There are people lying out at Arlington National Cemetery tonight. And I wonder what their perspective would be if they could come back among us for just a few moments.
I would suggest to you that they didn‘t die so that we could spend our country into bankruptcy, so that we could weaken our nation on all fronts, simply because we weren‘t fiscally responsible.
And they didn‘t die so we could put ourselves so deeply in debt that we sent tens of thousands for each little child born today, so that they would have to carry that the rest of their lives.
(END VIDEO CLIP)
SCHULTZ: Trent Franks has no authority to speak on behalf of American soldiers. He was an oil executive before going into politics. But Mr. Franks isn‘t the only righty exploiting troops to make an unrelated political point.
Last month, struggling presidential candidate Rick Santorum used World War II vets to attack President Obama‘s healthcare policy.
(BEGIN VIDEO CLIP)
RICK SANTORUM ®, PRESIDENTIAL CANDIDATE: Almost 60,000 average Americans had the courage to go out and charge those beaches on Normandy, the very Americans that our government now and this president does not trust to make a decision on your healthcare plan.
Those Americans risked everything so they could make that decision on their healthcare plan.
(END VIDEO CLIP)
SCHULTZ: Nothing is off limits for these guys, like Santorum and Franks. They will say anything to attack the other side. For them to exploit the sacrifice of American soldiers to score cheap political points, it is unpatriotic Psycho Talk.
Major victory for the Democrats in Wisconsin. State Senator David Hansen defeating his Republican opponent. He is standing by and will join us momentarily.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
DICK MORRIS, FOX NEWS CONTRIBUTOR: I‘m more interested in the state senators losing their jobs.
SEAN HANNITY, FOX NEWS ANCHOR: This talk of recalling these guys.
They are out there at a ritzy resort having themselves a good old time.
(END VIDEO CLIP)
SCHULTZ: That was Sean Hannity and Dick Morris knack in February. Wonder what they‘re thinking tonight. Voters in three Democratic districts in Wisconsin heading to the polls today. And at this hour, the results, they are definitely in.
Folks in the conservative Green Bay deciding for the first of nine recall general elections this summer. Incumbent State Senator Dave Hansen was once thought to be one of the vulnerable Democrats facing recall. Tonight, he was able to knock off Republican challenger David Vanderbleest.
It is a major blow to Scott Walker‘s union busting agenda. We are also monitoring results in two Republican primaries. These are all real Republican candidates. Each winner will go on to challenge the other two Democratic senators facing recall.
The Wisconsin Democratic party avoiding the Otto Yonkerman style of politics and choosing not to run any fake candidates.
In a moment, John Nichols of “The Nation,” Washington correspondent, is going to be joining us to help us analyze those primary results. But first, let‘s turn to the man from Green Bay. He is the winner tonight of the first recall election, Democratic Senator David Hansen.
Senator, congratulations. Great to have you with us tonight. You‘re from somewhat of a conservative area. Are you surprised at tonight‘s outcome?
DAVE HANSEN (D), WISCONSIN STATE SENATOR: Well, it is pretty loud here, Ed. But I want to thank you for all you‘ve done for the movement. I hope the movement tonight really continues as we move into the next eight recall elections.
We have really had tremendous volunteer help in northeastern Wisconsin, throughout Wisconsin, and throughout this country. People believe in what we‘re doing, standing up for working men and women of the state. They‘re seniors, our veterans.
We are going to continue to make a difference, Ed. You be there with us. We‘re going to get the majority back in the state senate with your help.
SCHULTZ: Well, we are going to broadcasting there obviously on the eight and ninth of August. But this was one where many people thought that maybe you weren‘t going to survive this challenge.
The outcome tonight, how do you feel about it? How heavy a lift was it?
HANSEN: We are really, really excited. You know, we fought the good fight. We didn‘t take anything for granted. We went after it. We won two to one. Hopefully this is the momentum builder we need for the next eight races, where we get the majority back.
That‘s goal. We have to continue to fight for working men and women. They count for a lot. They‘re important consumers. That has been forgotten in the Walker administration. The fight must continue. And we are going to get it done.
SCHULTZ: Senator, are you surprised in the dog days of summer, when it is almost 100 degrees out consistently, that people have such intensity in an off year election, to go out and do what they did today? Your thoughts on that.
HANSEN: Well, I‘m not surprised because the enthusiasm in this area and the whole state of Wisconsin behind us, we really do have the wind at our back. And we‘re going to make a difference. We just want balance in government again.
Wisconsin is a progressive state. We do not want to be Mississippi.
And that‘s what we are approaching now.
SCHULTZ: Senator, congratulations. Appreciate your time tonight.
Let‘s go to John Nichols in Madison, Wisconsin. John, your take on the results tonight. What does this mean? And what does it mean for Governor Scott Walker?
JOHN NICHOLS, “THE NATION”: Well, this is a big deal tonight, Ed. Dave Hansen was specifically targeted. The Green Bay Area has been voting a bit more conservative in recent years. So they went after him.
Instead, he won a landslide victory. Now, remember, in just a couple of weeks, one of the recalls of a Republican state senator is taking place on the other side of Green Bay. This has to energize Democrats in that area.
But it is also significant tonight, Ed, that if you look at the Republican primaries, these were contested Republican primaries in two other districts. In both those cases, turnout was surprisingly low.
So even though they had contested primaries, they had lower levels of turnout than the Democratic primaries with the fakes a week ago. What I am looking at, Ed, is a reality here that the Democrats appear to be incredibly energized for these elections. The Republicans, not so much.
SCHULTZ: And there‘s some other news out of Wisconsin. The state senate, John, Republicans passed their redistricting plan. What do they have up their sleeve? What does this mean?
NICHOLS: Well, this is ugly stuff, Ed. Look, they are rushing redistricting. They are violating the law. The law says that municipalities, local communities are supposed to redistrict first. They are pushing it through at the state level at a super charged rate.
They‘re doing it for two reasons. Number one, to confuse the voters.
Redraw the lines so you don‘t know where things are. Also, they‘re scared. They are trying to rush through a new set of lines before Democrats retake the state Senate. I don‘t think it will sit well with Wisconsinites.
SCHULTZ: John, how much money is going to flow in Wisconsin between now and August 9th?
NICHOLS: Serious analysts are saying that when these nine recall elections are done—we finished the first one tonight—something in the range of 20 million dollars will be spent. We already have some races over in western Wisconsin and in the Milwaukee area that are into the range of million dollar spending already.
SCHULTZ: What reaction is Governor Scott Walker getting when he said he made a mistake?
NICHOLS: Not very good. Yesterday, he went down to Deloitte, Wisconsin, to open a welcome center. He was supposed to be making a big deal about how Wisconsin is open to business. The place was absolutely packed with people who were saying quite loudly that they felt the mistake was electing Scott Walker.
SCHULTZ: Wisconsin State Senator Dave Hansen and John Nichols, Washington correspondent of “the Nation.” Gentleman, thanks for joining us. A big night for the Democrats, no doubt.
We will be broadcasting there THE ED SHOW on August 8th and 9th.
Tonight in our survey, I asked you should Democrats vote for any modifications to the big three. Ten percent of you said yes; 90 percent of you said no.
That‘s THE ED SHOW. I‘m Ed Schultz. You can listen to me on Sirius XM Radio, channel 127, Monday through Friday, noon to 3:00 pm on the radio.
“THE LAST WORD” with Lawrence O‘Donnell starts right now. We‘ll see you back here tomorrow night.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
END
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