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'The Last Word with Lawrence O'Donnell' for Monday, August 22nd, 2011

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Guest Host: Melissa Harris-Perry
Guests: Richard Engel, Ezra Klein, Lawrence Korb, Alex Wagner, Jonathan Capehart

MELISSA HARRIS-PERRY, GUEST HOST: The president`s strategy to support
rebels in Libya appears to be working. But opposing a dictator may be
easier with working with Republicans.

(BEGIN VIDEOTAPE)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: It`s clear that
Gadhafi`s rule is over.

RICHARD ENGEL, NBC NEWS: The city is now full of celebrations.

HARRIS-PERRY (voice-over): President Obama`s Libyan strategy is
working, even though Republicans say it`s not.

ANDREA MITCHELL, NBC NEWS: It`s such a validation, really, of the
administration`s strategy.

MARTIN BASHIR, MSNBC HOST: The president`s approach certainly seems
to have been the right one.

UNIDENTIFIED MALE: The president is expected to speak momentarily.

OBAMA: Relinquishing power to the people of Libya.

ED RENDELL, NBC NEWS ANALYST: Not one American fighting man or woman
got hurt.

TAMRON HALL, MSNBC ANCHOR: Members of the GOP criticized the
strategy.

UNIDENTIFIED MALE: They are always very quick to criticize the
president.

RENDELL: Mock when they decided this plan, mock.

UNIDENTIFIED MALE: They can`t stand it.

HARRIS-PERRY: The president`s biggest political battle is still the
economy.

UNIDENTIFIED MALE: This is about 2012.

UNIDENTIFIED MALE: What can the president do on the economy?

DAVID AXELROD, OBAMA SENIOR ADVISER: We can`t touch tax cuts for the
wealthy.

UNIDENTIFIED MALE: We don`t like hiring in this country anymore.

AXELROD: But we`ll allow $1,000 tax increase on the average
American.

HARRIS-PERRY: One Republican is trying to prove he lives in reality.

MITCHELL: Jon Huntsman has a new strategy.

JON HUNTSMAN (R), PRESIDENTIAL CANDIDATE: The Republican Party, the
anti-science party.

UNIDENTIFIED FEMALE: Ask him why he doesn`t believe in science.

HUNTSMAN: We take a position that isn`t willing to embrace
evolution.

GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: We teach creationism
and evolution.

HUNTSMAN: The wrong side of science.

HARRIS-PERRY: And Mitt Romney`s economic reality is unreal.

BASHIR: Twelve million dollar California home.

UNIDENTIFIED MALE: He`s tearing down his 3,000 square foot house to
build an 11,000 square foot house.

UNIDENTIFIED FEMALE: Your biggest problem today is how to expand one
of your houses.

UNIDENTIFIED MALE: How many Americans right now can afford to
bulldoze their beast-sized home?

BASHIR: A bit tone deaf, would you say?

UNIDENTIFIED MALE: The rich guy in the race.

UNIDENTIFIED FEMALE: This is Governor Romney`s stimulus plan.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Corporations are people, my
friends. Human beings, my friends.

(END VIDEOTAPE)

HARRIS-PERRY: Good evening from New York. I`m Melissa Harris-Perry,
in for Lawrence O`Donnell tonight.

Right now, it`s very early in the morning in the Libyan capital of
Tripoli. Rebel forces say they control about 95 percent of the city, but
there`s still fierce resistance from small pockets of pro-Gadhafi forces.

This video captured earlier by the "Associated Press" shows
opposition forces coming under fire at a former military academy in central
Tripoli. While dangerous flare-ups like this one are expected, there
remains a tense calm throughout the city and much of the country.

The head of National Transitional Council, the opposition`s political
party, insists that the real moment of victory wouldn`t come until Gadhafi
was captured.

Now, there are reports that NATO-led forces are bombing the Gadhafi
compound tonight, and a few hours ago, tanks left Gadhafi`s compound to try
to stop the rebel forces.

There were also some reports of pro-Gadhafi snipers around the city,
and two of the Libyan leader`s sons are in custody. We just learned the
third that was reportedly detained has been seen by reporters in Tripoli.

Leaders from around the globe are calling on Gadhafi to step down.

As for Gadhafi`s whereabouts, U.S. officials think he`s still in
Libya, possibly held up in a Tripoli military compound still under the
regime`s control.

But we don`t know whether or not that`s true for sure.

And President Obama, who is on a working vacation with his family in
Martha`s Vineyard, spoke earlier today. He pointed to the successes of the
United States and our allies as well as, of course, the Libyan people.

(BEGIN VIDEO CLIP)

OBAMA: An unprecedented coalition was formed that included the
United States, our NATO partners, and Arab nations. And in March, the
international community launched a military operation to save lives and
stop Gadhafi`s forces in their tracks.

In the early days of this intervention, the United States provided
the bulk of the firepower and then our friends and allies stepped forward.
Gadhafi was cut off from arms and cash, and his forces were steady
degraded. From Benghazi to Misrata, to the western mountains, the Libyan
opposition courageously confronted the regime and the tide turned in their
favor.

For over four decades, the Libyan people lived under a tyrant who
denied them their most basic human rights. Now, the celebrations that
we`ve seen in the streets of Libya shows that the pursuit of human dignity
is far stronger than any dictator.

(END VIDEO CLIP)

HARRIS-PERRY: The president also paid tribute to those Americans
who`d lost family members from past acts of terrorism by Gadhafi`s regime
and then thanked our nation`s military.

(BEGIN VIDEO CLIP)

OBAMA: We also pay tribute to Admiral Sam Locklear and all of the
men and women in uniform who have saved so many lives over the last several
months, including our brave pilots. They`ve executed their missions with
skill and extraordinary bravery and all was done without putting a single
U.S. troop on the ground.

(END VIDEO CLIP)

HARRIS-PERRY: Stop. Let`s hear that last line one more time.

(BEGIN VIDEO CLIP)

OBAMA: All of this was done without putting a single U.S. troop on
the ground.

(END VIDEO CLIP)

HARRIS-PERRY: So, despite the successes of the Obama White House`
strategy in Libya, protecting U.S. forces from danger while simultaneously
helping the opposition take control of Libya, the president is getting
absolutely no support or credit from Republicans.

In fact, Senators Lindsey Graham and John McCain issued a
condescending and deeply political statement reading in part, quote, "The
end of Gadhafi`s regime was made possible first and foremost by the
struggle and sacrifice of countless Libyans whose courage and perseverance
we applaud. We also commend our British, French, and other allies, as well
as our Arab partners, especially Qatar and the United Arab Emirates, for
their leadership in this conflict. Americans can be proud of the role our
country has played in order to defeat Gadhafi, but" -- here we go -- "we
regret the success was so long in coming due to the failure of the United
States to employ the full weight of our airpower."

So, that`s well-done Libyans, thanks Britain, France, all our allies
and all of our Arab partners, sentiments that are well-deserved, and, whoo-
hoo, America, we guess.

I don`t know if I`ve ever seen the word "failure" in a congratulatory
statement before.

And many in the field of Republican presidential candidates were also
quick to pile on.

Lawrence Korb of the Center for American Progress joins me to discuss
the politics of Libya in just a few minutes.

But, first, NBC News chief foreign correspondent Richard Engel is in
Tripoli with the latest on the rebel forces` efforts to completely secure
that city.

(BEGIN VIDEOTAPE)

ENGEL: We are now in Tripoli`s Green Square, and it was in this
square Gadhafi promised to crush this rebellion. Now, the square is
controlled by rebels. They have been coming in and out of here all day,
celebrating their near-complete takeover of Tripoli.

(voice-over): It was a day of embraces, cheers --

UNIDENTIFIED MALE: Gadhafi die!

(GUNFIRE)

ENGEL: And, of course, hear celebratory gunfire.

Libyans this morning poured into Tripoli to see what they thought was
their fully-liberated city.

UNIDENTIFIED MALE: The city is under siege and control of rebels.

ENGEL: Rebels were greeted like heroes, some kissed the ground in
thanks.

The outpouring of emotion wasn`t only in Tripoli. In Benghazi, the
rebel capital saved by NATO`s intervention -- and Misrata, a city Gadhafi`s
forces pounded with artillery and rockets and nearly destroyed.

UNIDENTIFIED MALE: I`m 25 years now, my life starts now.

UNIDENTIFIED MALE: Libya is freed finally. She`s about for her
sons.

ENGEL: Nationwide, they tore Moammar Gadhafi`s all-green flag and
paraded the rebel`s tri-colored banner. Nearly all signs of state control
here are gone.

Libyan government TV is off the air. But away from the celebrations,
Tripoli is still at war.

UNIDENTIFIED MALE: There`s many snipers from Gadhafi military.

ENGEL: The rebels hold about 90 percent of the city, but don`t
control Gadhafi`s compound, fortified like an army base.

(on camera): We`re just about 300 yards from Gadhafi`s compound,
it`s at the end of this street. Loyalists inside have been firing tanks
and mortars to defend it, making a final stand.

(voice-over): It`s unclear if Gadhafi is still inside, his
whereabouts are unknown.

UNIDENTIFIED MALE: He played his last card. If you can say, his
last game. Even his big car and his army, they lose control.

ENGEL: Rebels are preparing to take the compound and have it
surrounded.

A day that began with such joy ended with a realization. These
rebels still have fighting to do.

(on camera): And, Melissa, the rebels here have already changed the
name of the square from Green Square to Mortar Square -- Melissa.

(END VIDEOTAPE)

HARRIS-PERRY: That was NBC News chief correspondent Richard Engel in
Tripoli.

Now, joining me for more on the politics surrounding the situation in
Libya is Lawrence Korb, a senior fellow at the Center for American
Progress.

Thanks for joining us.

LAWRENCE KORB, CENTER FOR AMERICAN PROGRESS: Nice to be with you,
Melissa.

HARRIS-PERRY: Now, Lawrence, I think anyone who just saw me in the
first segment knows this is not my area of expertise, foreign policy. That
said, I do know a little bit about American domestic politics around
foreign policy.

And I have to say that statement from John McCain and Lindsey Graham
was frankly pretty shocking to me, the statement about Americans can be
proud of the defeat but regretting that the success was so long and coming
due to our failure.

What are we to make of a statement like that from the out party, from
the Republican Party?

KORB: Well, it shows that they were wrong, because they assume that
unless we put, you know, troops on the ground or unless we did all of the
bombing that, you know, we couldn`t succeed. And this did succeed, because
we were patient and they don`t want to admit they were wrong.

You know, they should have looked at Benghazi today, there were
banners there that said "Thank you, Obama," as well as, you know, Prime
Minister Cameron and President Sarkozy. So, it`s incredible that these are
the people that got us into Iraq under false pretenses and look what
happened there. I mean -- sure, we overthrew the regime in three weeks,
but nearly a decade later, we`re still having Americans dying there.

HARRIS-PERRY: It seems to me that part of the politics here might
have to do with where the president has control. There`s a lot to
criticize on unemployment, on the economy.

But the fact is on domestic politics, the president has to work with
Congress. Isn`t it true that in terms of foreign policy, this is actually
where the president has relatively more autonomy and that the record over
the past three years is what better here, the death of Osama bin Laden -- I
mean, heck, back to the first 100 days of the shooting of the Somali
pirate, all the way up to now, the potential overthrow of Gadhafi.

Is there something here about when the president has some autonomy it
seems to turn out better?

KORB: Well, there`s no doubt about it. And, in fact, you know,
traditionally, the Democrats have been seen as weak on defense and the
Republicans have been the strong party on national security.

But here, as you mentioned, Obama gets bin Laden, and what do they
say? Oh, it was really Bush`s torture that got bin Laden, he stepped up
the drone attacks along the border of Afghanistan and Pakistan, is killed
scores of al Qaeda leaders. He saved Afghanistan. Afghanistan was
falling apart because the Bush administration was so fixated on Iraq that
the Taliban had the momentum until he came in.

And so, they don`t want to give him any credit because they feel this
will kind of undermine their narrative. And you`re quite right, where he
can do it by going after bin Laden, even the secretary of defense didn`t
want him to do that, but he took a courageous stand because if that back
fired, he`d be in a lot of trouble.

HARRIS-PERRY: Now, you`ve made this comparison between Libya and
Iraq. We certainly know how they compare in terms of lives lost for
Americans, how do they fare in terms of dollars and the impact on our
budget?

KORB: Well, I mean, here`s where I think Obama, people have said --
well, we`re broke, we can`t afford these things. This whole operation has
cost us at most about $1 billion. Iraq is up to like $2 trillion.

And so, why not let the international community get involved? They
are the ones that rely on the oil as well as us. They are concerned about
instability in that part of the world.

And, you know, when we went into Iraq under false pretenses, that
enhanced the al Qaeda narrative and it created a lot more terrorists. Here
we had the Arab League urging us to go, NATO, the United Nations. So, this
is not generating, you know, anti-American feeling. In fact, as that sign
in Benghazi said, it`s pro-American feeling.

HARRIS-PERRY: Yes, that`s certainly a different affect than what
we`ve had in Iraq.

Lawrence Korb, senior fellow at the Center for American Progress --
thank you so much for joining me tonight.

KORB: Thank you for having me.

HARRIS-PERRY: Thanks.

Coming up, if you think the GOP is against ever raising taxes, think
again. There`s one they are fine with, and we`ll explain that.

And I got to tell you, I want the problem of one of the Republican
candidates -- 3,000 square feet on the ocean just isn`t enough for Mitt
Romney. He`s planning on quadrupling the size of one of his houses, one of
them. That`s coming up.

(COMMERCIAL BREAK)

HARRIS-PERRY: Coming up, Jon Huntsman believes in science and is
worried about the messages being sent by the extreme right wing of his
party. If he`s going to win the nomination, he`s going to have to stop
making sense.

And his distant cousin Mitt Romney is in a bind. You would think
running for president is a big enough for the year. But Romney is taking
on another one, an extreme makeover of his home, which includes tearing
down his 3,000 square foot home and putting a 11,000 square foot one, all
the way maintaining that the president is the one out of the touch.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: There are things we can do right now that will mean more
customers for businesses and more jobs across the country. We can cut
payroll taxes again so families have an extra $1,000 to spend.

(END VIDEO CLIP)

HARRIS-PERRY: That was President Obama in his weekly address urging
Congress to extend payroll tax rates that he signed into law last December.

Now, for those who are still employed, you might have seen the
payroll tax on your pay stub. If you haven`t scrutinized it, here`s how it
works. Last year, employees paid 6.2 percent tax on their wages that went
towards Social Security, employers also paid 6.2 percent, for a total
contribution per employee.

As part of the 2011 budget compromise passed in December, the
employer contribution stayed at 6.2 percent, but the employee contribution
dropped to 4.2 percent. This puts an average of $1,000 into the pocket of
each American worker.

Now, if the payroll tax holiday is not renewed before January 1st,
the percentage returns to 6.2 percent for employer and employee.

Here`s the thing, though, workers only pay this tax on the first
$106,800 of their wages. It`s like cap tax.

Now, this is nice if you are wealthy, but means nothing if you`re one
of the millions of Americans that makes more than $106,800 per year. As
billionaire investor Warren Buffet wrote in the "New York Times," quote,
"The mega-rich pay income taxes at a rate of 15 percent on most of their
earnings, but pay practically nothing in payroll taxes."

So, it`s a different story for the middle class. Typically, they
fall into the 15 percent and 25 percent income tax brackets and then they
are hit heavy with payroll taxes to boot.

So, President Obama`s essentially pushing to extend a tax cut to
primarily benefit the poor and middle class. Now, you`d think he would
have no trouble finding support for this or any tax cut in the Republican
Party.

All but 13 of the 287 Republican members of Congress have signed
Grover Norquist`s pledge to oppose all tax increases, including closing
loopholes.

Would a pledge signer violate that oath if he or she let the payroll
tax cut expire? Well, not technically according to the logic of Norquist,
applied to the question of extending the Bush tax rates. Norquist`s pledge
governs how you vote, there`s no vote on extending the payroll tax rate and
it just expires, that`s technically not a pledge violation.

Now, that said, letting tax cuts go up on Americans absolutely
violates the anti-tax principle of this pledge. To quote House Majority
Eric Cantor in his "Washington Post" editorial yesterday, "We well know
that the Republican majority was not elected to raise taxes or take more
money out of the pockets of hardworking families and business people."

Bottom line: Republicans should, based on their own logic, support
extending the payroll tax cut, but they don`t.

Republican Congressman Jeb Hensarling, who will co-chair the joint
select committee on deficit reduction, told "The Associated Press," "It`s
always a net positive to let taxpayers keep more of what they earn, but not
all tax relief is created equal for the purpose of helping to get the
economy moving again."

The reason some Republicans do not believe the payroll tax cut
stimulates the economy is because it`s not permanent.

In June, House Budget Committee Chair Paul Ryan called the tax cut,
quote, "sugar high economics."

A spokesman for Leader Cantor said, quote, "Cantor has never believed
that this type of temporary tax relief is the best way to grow the
economy."

Republicans also say it increases the deficit.

Now, here`s what the office of Republican Congressman David Camp, who
was also a member of the supercommittee, told the "A.P.," quote, "Tax
reductions no matter how well intentioned will push the deficit higher,
making the panel`s task that much harder."

Now, joining me now is MSNBC contributor and "Washington Post"
columnist, Ezra Klein.

Thank you for joining me, Ezra.

EZRA KLEIN, MSNBC CONTRIBUTOR: Good evening.

HARRIS-PERRY: So, we started this conversation in earnest on Friday
when I joined you on "Martin Bashir`s Show" that you were guest hosting,
and we talked a little bit about this payroll tax question. So, I`m really
excited to get to extend this conversation with you.

KLEIN: We should have a tax hour once a week.

(LAUGHTER)

HARRIS-PERRY: Oh, OK, all right.

Now, extending the payroll tax will cost the government about $115
billion. There`s no doubt Republicans are right about this in the sense it
will increase deficit. But how do you score it on its stimulative affects
versus, say, extending the Bush tax rates.

KLEIN: First, it`s nice to see Republicans admitting tax cuts
actually cost money. That is -- from what Mitch McConnell was saying about
a year ago, that is actually an advance. The payroll tax cut is much more
stimulative than most, although not the most stimulative tax cut you can
do.

And here`s why -- the payroll tax, as you mentioned in your
introduction here, it affects only the first $106,000 of your income. So,
the people it really ends up helping out are the people who actually have
to spend their income to make things meet.

If you`re trying to get money into the economy right now, what you
want, and the reason tax cuts often don`t work, is a tax cut that will be
spent and not saved. So, a tax cut that is targeted to people who actually
need to spend the money they earn as supposed to having a fair amount of
money they can save and stock away. That will actually get into the
economy much quicker and ends up being more stimulative.

HARRIS-PERRY: OK. Mitt Romney told us that he did not flatly ruled
out an extra year for the payroll tax cuts. But that he`d he preferred to
see it happen on the employer side rather than the employee`s side.

But here, Ezra, I really want to ask you this question -- why not, if
we`re going to reinstitute this, why not just raise the cap so that instead
of being at around the $100,000 rate, it`s at, say, $200,000 or, say,
$300,000 or, say, every dollar that is earned would be subject to payroll
tax. Why is this the only assumption is employee versus employer side?

KLEIN: Because rich people don`t like to pay taxes and they are
powerful.

It`s worth saying. Remember, of course, a payroll tax is there to
fund Social Security. And if you raise the cap, what you`d do is you`d
raise about 0.6 percent of GDP -- 0.6 percent of GDP happens to be the
exact size of the Social Security shortfall. So, if you raise new payroll
tax cut, if you simply you eliminated it, you would in one fell swoop, and
there`s no argument over this really, you would in one fell swoop close the
Social Security tax gap.

That would be it. You`d be done. You wouldn`t have to cut benefits.
You wouldn`t have to raise retirement age. It would be finished.

Now, if you say you don`t want to do that because you would prefer to
raise retirement age, as opposed to raise taxes on people making more than
$108,000 a year, that`s your prerogative. But that would be a very big
step towards fiscal responsibility.

HARRIS-PERRY: So I feel like what I heard you just saying, what we
have started talking about last week is this idea that on the one hand,
Republicans appear to be willing to actually increase taxes on people who
make $100,000 or less by allowing this tax cut to expire, but unwilling to
imagine raising this cap so that people who make even $200,000 or $300,000
would be paying a same kind of fair share.

I just want to be completely clear that that`s what`s happening here.

KLEIN: Absolutely. And It`s been striking as you`ve seen the
Republicans have a marked and evident preference for tax cuts that affect
the rich as opposed to the middle class. And if you listen to their
rhetoric, you`ll actually hear that come through pretty clearly. You`ll
hear them talk about how we can`t raise taxes on those who create jobs, on
the most productive members of our society, and you do get the feeling the
implicit economic theory they are working off of is that people who really
drive the economy are the wealthy, are the rich, are the people who are
making a lot of money and presumably making a lot by hiring people.

And that for the rest of us, it doesn`t really matter if you give us
a tax cut because we`re not going to do anything that`s that useful with
it. And so, it`s not going to have a big effect on the economy.

That does appear to be the model the GOP is working off of, if you
just look at their policy references and their rhetoric.

HARRIS-PERRY: Sure. Nothing that useful, $1,000, like maybe buy
some more groceries or help send your kid to school, that kind of thing.

KLEIN: Right.

HARRIS-PERRY: MSNBC contributor Ezra Klein, thank you for joining
me, and you are probably the only person I`d just do a tax hour with.

(LAUGHTER)

KLEIN: Thank you for having me.

HARRIS-PERRY: Thanks.

KLEIN: Coming up, ratcheting up the whacky in the GOP presidential
primary, and the one voice standing out as reasonable. Paging Nelson
Rockefeller.

And people in glass houses shouldn`t throw stones, Willard M. Romney,
I`m looking at you and all of your houses. That`s coming up.

(COMMERCIAL BREAK)

HARRIS-PERRY: As Libya lunges towards freedom, America pauses to
remember a leader who helped make our own nation free. It will be
dedicated this coming Sunday on the 48th anniversary of his generation-
defining speech.

But today, America got its first look at the memorial on the National
Mall. The Martin Luther King Jr. national memorial was unveiled to
visitors for the first time this morning. The centerpiece: a 30-foot tall
granite statue of King. Behind him, a wall inscribed with his speeches.
During his life, King disliked having a fuss made about him.

He once told his followers that after his death they should not
mention his great achievements, but only remember him as, quote, "a drum
major for justice."

But despite his humility, this is a well-deserved memorial. It
reminds us, in King`s words, "I won`t have the fine and luxurious things to
leave behind, but I just want to leave a committed life behind."

On ABC yesterday, Jon Huntsman warned that opponents Michele Bachmann
and Rick Perry are so far to the right that they are unelectable. Will his
plan to paint himself as the only non-wacky candidate work? That`s next.

And in between his speeches on fixing the economy and getting
Americans back to work, Mitt Romney has evidently been working on
construction plans for his new 11,000-square foot mansion. And that`s only
his California home. That`s coming up.

(COMMERCIAL BREAK)

HARRIS-PERRY: Jon Huntsman has had enough. As the Republican party
continues to be chased to the right by the Tea Party, one Republican
presidential candidate has decided to directly confront the extremism in
his own party. Huntsman`s campaign hasn`t managed to break out of the
single digits in the polls, unlike conservative fire brands Rick -- no
relation -- Perry and Michele Bachmann, who have rocketed to top tier
status in the Republican primary, in spite of or perhaps because of
rhetoric like this.

(BEGIN VIDEO CLIP)

GOV. RICK PERRY (R), PRESIDENTIAL CANDIDATE: Printing more money to
play politics at this particular time in American history is treacherous --
treasonous in my opinion.

REP. MICHELE BACHMANN (R), PRESIDENTIAL CANDIDATE: How many of you
love the IRS? First rule of war is know your enemy. So I went to the
inside to learn how they work, because I want to defeat them.

PERRY: We need to be free in this country from over-regulation. We
need to be free in this country from over-taxation, from over-litigation.

BACHMANN: The best thing that we can do is shut down and close the
Federal Department of Education.

PERRY: In Texas, we teach both creationism and evolution.

BACHMANN: I guarantee you the EPA will have doors locked and lights
turned off.

PERRY: I`ll work every day to try to make Washington, D.C. as
inconsequential in your life as I can.

(END VIDEO CLIP)

HARRIS-PERRY: Now in an interview on ABC`s "This Week," Huntsman
warned Republicans that extremism could cost them the election. And he
made a point of specifically criticizing Bachmann and Perry.

(BEGIN VIDEO CLIP)

JON HUNTSMAN (R), PRESIDENTIAL CANDIATE: I think when you find
yourself at an extreme end of the Republican party, you make yourself
unelectable. The minute that the Republican party become the party -- the
anti-science party, we have a huge problem. We lose a whole lot of people
who would otherwise allow us to win the election in 2012.

I`m not sure that the average voter out there is going to hear that
treasonous remark and say that sounds like a presidential candidate; that
sounds like someone who is serious on the issues.

Gas prices just aren`t going to rebound like that, but it just simply
is not founded in reality.

GEORGE STEPHANAPOLOUS, ABC ANCHOR: Would you trust a President
Bachmann to do the right thing with the economy?

HUNTSMAN: Well, I wouldn`t necessarily trust any of my opponents
right now who were on a recent debate stage with me when every single one
of them would have allowed this country to default.

(END VIDEO CLIP)

HARRIS-PERRY: So that`s what Huntsman said. Will Republicans listen?
Consider what happened in 1964 when the Republican party was enthralled by
another conservative presidential candidate, Berry Goldwater. Moderate
Republican candidate Nelson Rockefeller, the governor of New York, was
practically run off stage at the RNC convention when he tried to warn the
party about the perils of going too far to the right.

(BEGIN VIDEO CLIP)

NELSON ROCKEFELLER, FORMER GOVERNOR OF NEW YORK: The Republican party
is in real danger of subversion by a radical, well-financed, highly
disciplined -- they have no program for America, no program for the
Republican Party, no program to keep the peace and bring freedom to the
world.

(END VIDEO CLIP)

HARRIS-PERRY: Shortly after that speech, Republican delegates
nominated Goldwater. He went on to lose to Lyndon Johnson, who won with an
astonishing 61 percent of the vote. No presidential candidate from either
party has managed a bigger electoral victory since.

Joining me now -- and I`m very excited about it -- is MSNBC analyst
and "Huffington Post" reporter Alex Wagner.

ALEX WAGNER, "THE HUFFINGTON POST": It`s a pleasure to be here.

HARRIS-PERRY: It is lovely to see you. And we were so distracted
earlier, before the shot, talking about all of this. But that moment, that
film with Nelson Rockefeller is amazing to me, that that`s from 1964,
because it feels like he could be speaking about the Tea Party right now.

WAGNER: Sure.

HARRIS-PERRY: So when Huntsman takes in and takes this role, and
says, whoa, we are going too far to the right, who is the audience for
that? What is he imagining? What gap is he trying to fill?

WAGNER: He -- Huntsman said in the interview, "I`m the center right
candidate for a center right country." Ostensibly, he`s under the
impression that America is still a rational, center right place. That is
very much TBD. I mean, I think if you look at the footage and we see just
how far this country and the party, the Republican party, has come to the
right -- I mean, it is now -- we are in a position where Ronald Reagan on a
lot of things looks like a moderate.

George W. Bush worked across the aisle with Teddy Kennedy to pass No
Child Left Behind. George W. Bush had a more progressive position on
immigration than anybody that`s running for president. That was a handful
of years ago. And to a degree, the question remains, could we even have a
George Bush in this election season?

HARRIS-PERRY: I tell you, when I am driving down the Ronald Reagan
Freeway, as I was this weekend, and I was like, yes, Ronald Reagan would be
a much better political choice at this point. I mean, the -- what`s
exciting to me about Huntsman -- I`ve made this argument many times. We
are always in a country that`s generally divided. About 50 percent of
people are Republicans; about 50 percent are Democrats.

We want a strong Republican party, one that makes sense, one with real
policy issues.

WAGNER: Sure.

HARRIS-PERRY: Is Huntsman viable, though? Or is this really just a
repeat of `64?

WAGNER: If we`re looking at his numbers, he`s not viable. But his
strategy is look, New Hampshire elects presidents; South Carolina elects
presidents. He made a choice to sit out Iowa. He thinks that he`s not
going to try and vie for the most conservative in the party. In that same
interview, he called out America`s almost heroin-like dependence on foreign
oil, which is -- I mean, talk about things that you do not hear from the
right.

The guy is clearly making a very, very strong play for the center.
Whether there`s going to be any center left after this -- this fight that
we`re going to go through in the next year remains TBD.

HARRIS-PERRY: So back up for me a second, though, because the fun
thing, if one were a Democrat and looking at this, would be to say OK, if
this was just like `64, then no matter what happens on the domestic
economic front, President Obama is going to be able to win in an LBJ
fashion.

But that`s not what these polls -- at least these daily tracking polls
are looking like. It actually looks like President Obama is tied within
the margin of error with most of these candidates that we`re saying look
like Goldwaters to us.

WAGNER: Well, I think in one poll that I saw today, Obama was two
points ahead of Ron Paul, which gives you a sense. But there are 15
million people out of work, 30 percent of mortgages are underwater. People
are angry. And I think to that degree, they want something that looks
different, that their -- and anger and blood lust has a certain part to do
with that.

And you know, change is something that people do believe in. But I
think the president, on his part, has to make an elegant and forceful case
that he can do something in 2012. Because I think right now if he`s
elected -- reelected, I think there`s a sense on the part of the American
public that they don`t know what he stands for.

They know that he can compromise and will compromise. But in terms of
the ideals, what he`s going to do to move the ball forward and help this
country, there are a lot of question marks.

HARRIS-PERRY: Is this really the power of discourse, of framing? I
was talking earlier about sort of the president`s successes in foreign
policy. On the one hand, it does look like we have a record of success, of
passing big legislation like health care reform, for example. And yet
still the sense that people feel like we don`t know what he stands for,

Is it just discursive, or is there something governing here?

WAGNER: Look, I think he`s had an enormous number of legislative
accomplishments. And he, to some degree, has walked back from those a
little bit, I think because Obama is inherently sort of a conflict averse
person and some of these -- some of these issues have not -- the
Republicans have managed to sort of dominate the argument on this.

I think he`s got to make a forceful case for himself, his
administration, and what he`s going to do. And that will then serve as a
great contrast with what the GOP is offering.

HARRIS-PERRY: Alex, it is no so nice to be here and have an
opportunity to talk with you in person.

WAGNER: Thanks for having me.

HARRIS-PERRY: Thanks for being here. MSNBC contributor and columnist
for "the Huffington Post," Alex Wagner.

Coming up, Rick Perry`s campaign is saying that his book, "Fed Up,"
isn`t meant to reflect his current views. So he doesn`t think Social
Security`s a Ponzi scheme? That`s next.

And later, even fudge Duchess of Cambridge Kate Middleton is wearing
her dresses for multiple public events, to show solidarity with the British
people experiencing an economic crisis. But Mitt Romney decides to triple
the size of one of his homes while the American unemployment rate is over
nine percent? That`s coming up.

(COMMERCIAL BREAK)

HARRIS-PERRY: Republican presidential candidate Rick -- no relation -
- Perry is barely into his second full week on the campaign trail. And
already his team has had its first flip-flop mess to clean up.

And just one person is getting in the way of that, Rick Perry.
Perry`s communication director, Ray Sullivan, is trying to do damage
control after news organizations like "the Wall Street Journal" started
taking a closer look at Perry`s book, "Fed Up, Our Fight to Save America
from Washington."

In it, Perry goes after Social Security, calling it, quote, "a
crumbling monument to the failure of the New Deal and at the expense of
respect for the Constitution and limited government."

Many American seniors who now live with dignity and security instead
of hunger and fear might disagree with Perry comparing Social Security to,
quote, "a bad disease and a Ponzi scheme."

But Sullivan, as the Perry spokesman, told the Journal last week that
he has never, quote, "never heard Perry suggest the program was
unconstitutional."

Maybe he too needs to read the book. Sullivan said "Fed Up" is not
meant to reflect Perry`s current views on how to fix the program. Yet "Fed
up" was published just nine months ago. "The book," Mr. Sullivan said,"is
a look back, not a path forward. It was written as a review and critique
of 50 years of federal excesses, not in any way as a 2012 campaign
blueprint or manifesto."

So how do you think Perry responded when he was asked on one of his
first campaign stops in Iowa last Sunday what he would do to fix the
nation`s entitlement programs.

(BEGIN VIDEO CLIP)

PERRY: The whole issue of -- have you read my book, "Fed Up"? Get a
copy of it and read it. It`s -- it is, because I talk about the
entitlement programs in there.

(END VIDEO CLIP)

HARRIS-PERRY: Perry didn`t steer people away from the book and his
condemnation of Social Security. He sent voters straight there to answer a
question, as Sullivan put it, about the path forward. And he added this.

(BEGIN VIDEO CLIP)

PERRY: Now, I know our friends on Democrats side, they are all going
to jump and say those bad, old mean Republicans, they`re going to take away
your Social Security and take away your Medicare. No, we`re not.

(END VIDEO CLIP)

HARRIS-PERRY: So Perry is both referring people to his book, the one
that called Social Security a Ponzi scheme, and in the same response to a
voter promises that Republicans won`t take it away.

On Thursday, with protestors outside holding signs reading "hands off
my Social Security,." Perry went into a New Hampshire pastry shop and was
asked repeatedly to clarify and explain if he thought Social Security was
really unconstitutional.

Perry ignored the questions and stuck to the photo op. And if Perry`s
own camp is any judge, the road ahead is going to be filled with
contradictions. As the Journal wrote, quote, "Mr. Sullivan acknowledged
that many passages in Perry`s `Fed Up` cold dog this presidential
campaign."

Now, I actually don`t happen to think that flip-flop is always a bad
thing. I think it`s bad to punish a candidate or an elected official for
being willing to collect new information and develop new ideas. If leaders
are willing to stop, listen, learn and evolve, that`s good for them and for
us.

President George W. Bush, AKA The Decider, often boasted of his
tenacious determination to stay the course, even when everything suggested
the country needed to be taken on a new course. At my most charitable, I`d
like to believe that Rick Perry is having a moment of clarity that would
allow him to see the danger in declaring America`s crucial social safety
net unconstitutional.

Even if he`s having trouble saying it. But when his staff tells you,
in effect, to ignore what he wrote in a book less than a year ago, and when
Perry answers policy questions on the campaign trail just days ago by
saying "read the book," then maybe I and all of us need to evolve in our
thinking, and look at just how similar Rick Perry and George Bush really
are after all. >

Coming up, Mitt Romney says he understands all that stuff about
unemployment. He`s unemployed. He`s so unemployed he`s got time to plan
for one of his houses triple in size. Why it doesn`t matter that a
presidential candidate is rich, but it does matter that Mitt Romney is,
next.

(COMMERCIAL BREAK)

HARRIS-PERRY: The central message of Mitt Romney`s presidential
campaign is that unemployment is high and he gets it, unlike President
Obama.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: There are always going
to be bumps on the road to recovery.

UNIDENTIFIED MALE: I`m an American, not a bump in the road.

(END VIDEO CLIP)

HARRIS-PERRY: So while many Americans struggle to pay their
underwater mortgages and face home foreclosures, Romney is taking a
surprising step that`s about as sensitive as the time he joked to a group
of unemployed Floridians --

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I also tell my story. I`m
also unemployed.

(END VIDEO CLIP)

HARRIS-PERRY: Romney`s campaign confirmed today he plans to bulldoze
his 12 million dollar beach house in California and build an 11,000 square
foot beach house in its place. In addition to the California house, he
also owns a townhouse outside Boston and a 10 million dollar vacation home
in New Hampshire.

Now why should we care? I do not believed that just because a person
is wealthy, he or she can`t provide or won`t provide leadership in tough
economic times. After all, it was the patrician, FDR, who led the country
out of the Great Depression.

But Mitt Romney is no Franklin D. Roosevelt. Romney`s policy
positions reflect his belief that corporations are people, and that the
wealth of the top one percent should be protected at the expense as
everyone else. So before Romney cuts another ad portraying himself as the
hero of the downtrodden and working class, he should recall another ad in
2008 that could be easily recycled this time around.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: When asked how many houses he owns, McCain lost
track. He couldn`t remember. Well, it`s seven. Seven houses. And here`s
one house America can`t afford to let John McCain move into.

(END VIDEO CLIP)

HARRIS-PERRY: Joining me now is Jonathan Capehart, "Washington Post"
editorial writer and MSNBC contributor. Hi, Jonathan.

JONATHAN CAPEHART, "THE WASHINGTON POST": How are you?

HARRIS-PERRY: I always feel like we always bring you in to do the
snark thing with me on the GOP.

CAPEHART: It`s just too much fun.

HARRIS-PERRY: I know. It is. But is it legitimate? Look,
presidents are wealthy people. They have Ivy League degrees. Is it OK for
us to make fun of Mitt Romney for bulldozing his gigantic beach mansion and
then building another one in the same spot?

CAPEHART: When you put it like that, of course, it is. No, of course
it is. Look, I think this plays into the narrative that unfortunately Mitt
Romney unwittingly plays into. He`s smart. He`s handsome. He`s rich.
And on top of it, he`s changed his policy positions on a whole host of
things that sort of feed into -- sort of makes you not want to like him in
that way.

Remember in the -- yes, 2008 campaign, there were stories going around
how none of his Republican opponents even liked him. So the fact that he
has a fabulous beach house in California. He`s bulldozing it and he`s
going to build an 11,000-square foot house in its place -- you know, it`s
just you look at the guy like really, you were just there in that diner in
Florida saying you were unemployed.

And even when he did that, we all crossed our eyes, saying are you
serious? Really, are you serious?

HARRIS-PERRY: Is this just a timing issue? Look, we spent last week
asking should the president go on vacation to Martha`s Vineyard during a
time of economic crisis. I certainly know that I was one of the people who
said sure, he can go. He can take a Blackberry and everything.

So is this really just timing? I mean, he is a millionaire. He can
build as many homes as he wants.

CAPEHART: Sure.

HARRIS-PERRY: You have "Vanity Fair" talking about the big things
that could fit inside his house. The entire Memphis Area Enterprise Rent-
A-Car facility, Jennifer Aniston`s entire old house, apparently, the
world`s largest whale.

CAPEHART: I have some others too.

HARRIS-PERRY: What did you have?

CAPEHART: Well, you could fit three times the area of Air Force One
in that space. It`s 4,000 square feet. And just for comparison`s sake,
President Jefferson`s Monticello -- President Jefferson`s estate is just a
little bit -- they are about the same size at 12,000 square feet. And then
both of Al Gore`s homes that he was made fun of, you know, the mansion in
Tennessee and the villa in California -- the villa is twice the -- half the
size of Romney`s new compound.

And the Tennessee house is just 1,000 square feet smaller than
Romney`s.

HARRIS-PERRY: One could argue, however, that Monticello was after all
built with slave labor.

CAPEHART: Yes, there`s that.

HARRIS-PERRY: That was even worse economic conditions that the
current unemployment crisis.

CAPEHART: Right.

HARRIS-PERRY: But look, is there something -- I recently moved from
Princeton, which is a privileged enclave, to a struggling neighborhood in
New Orleans. It was a choice that my husband and I made, in part to be in
a community that was struggling, because we wanted to be sure that we were
part of the work that we care about, right?

And it is true that you get a completely different perspective in
different kinds of communities. Is there a danger to being represented in
the federal government, in local government, in any of our representations,
elected representations, by people who basically live in protected bubbles
and don`t experience first hand what this economy is like for most people?

CAPEHART: Absolutely. People want to go into the voting booth and
vote for someone they feel gets what their life is like, especially in down
economic times, when people are struggling and people are hurting.
Remember when George H.W. Bush was on that tour of that supermarket and did
that scanner thing. It`s not that he didn`t know it was an electronic
scanner, but it played into this narrative that H.W. Bush was someone who
was removed, attached, totally unaccustomed to what regular Americans --
how they live their lives. I think that`s what -- the trouble Romney is
going to have with this latest story.

HARRIS-PERRY: The "Washington Post`s" Jonathan Capehart, and snark
buddy, thank you for joining me tonight.

CAPEHART: Thanks, Melissa. Great to see you.

HARRIS-PERRY: You can have THE LAST WORD online at our blog,
TheLastWord.MSNBC.com. And you can follow me tweets @MHarrisPerry.
Another shameless plug for my new book, the one written by a Perry who is
not a Republican presidential candidate. It`s in stores new, titled
"Sister Citizen."

"THE RACHEL MADDOW SHOW" is up next.

END

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