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'The Last Word with Lawrence O'Donnell' for Friday, September 23, 2011

Read the transcript to the Friday show

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Guests: Chris Hayes, Eugene Robinson, Maggie Haberman, Eric Ries

LAWRENCE O`DONNELL, HOST: To have a fight for the soul of the
Republican Party? Wouldn`t the party have to have a soul?

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: I`m a gay soldier.

(BOOING)

GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: I don`t think you
have a heart.

O`DONNELL (voice-over): The Republican debate audience is starting to
scare the candidates.

CHUCK TODD, NBC NEWS: The audience reaction was somewhat more
surprising than anything.

RICK SANTORUM (R), PRESIDENTIAL CANDIDATE: I have to admit I
seriously did not hear those boos.

TODD: Then you had this --

SANTORUM: We would reinstitute that policy if Rick Santorum was
president. Sex is not on issue.

ANDREA MITCHELL, NBC NEWS: "Don`t ask, don`t tell" doesn`t have to do
with sex.

UNIDENTIFIED MALE: That gay soldier is their son.

UNIDENTIFIED MALE: No one found a way to say, you know what, we honor
his service.

UNIDENTIFIED MALE: When you have a moment like that when you`re
booing a United States Marine or an officer, it really bothers a lot of
people out there.

TODD: The death penalty moment --

MITCHELL: With Brian Williams.

BRIAN WILLIAMS, NBC NEWS: Your state executed 234 death row inmates,
more than any other governor in modern times.

(APPLAUSE)

WILLIAMS: Have you --

TODD: You had the let them die scream, shout-out by somebody in an
audience with Ron Paul.

REP. DEBBIE WASSERMAN SCHULTZ (D-FL), DNC CHAIRMAN: That`s not going
to play well no matter who is the Republican nominee.

O`DONNELL: And the Republican candidates are scaring everyone.

MITCHELL: The more Rick Perry debates, the more uneasy some
Republicans feel.

UNIDENTIFIED MALE: Rick Perry, looks as comfortable as a chimp
opening a suitcase.

UNIDENTIFIED FEMALE: You heard privately from Republicans that, you
know, he was sort of Bush without the brains.

TODD: It was a rough night for Rick Perry.

UNIDENTIFIED MALE: Look at Rick Perry and he looks lost.

UNIDENTIFIED FEMALE: Painting him as clueless.

MITCHELL: He was just hanging himself.

UNIDENTIFIED MALE: He was wooden.

UNIDENTIFIED MALE: Texas toast? Question mark.

MITCHELL: How is it going to go mano-a-mano with Barack Obama?

DAVID GREGORY, NBC NEWS: Mitt Romney looks aggressive.

UNIDENTIFIED MALE: Romney is looking pretty darn good.

O`DONNELL: And most Republicans are still hoping for a miracle.

UNIDENTIFIED MALE: Everybody is still talking about Chris Christie.

UNIDENTIFIED MALE: Christie.

UNIDENTIFIED MALE: Chris Christie. You hear it all the time.

UNIDENTIFIED MALE: Chris Christie is passing up a once in a lifetime
opportunity.

(END VIDEOTAPE)

O`DONNELL: Once again, in last night`s Republican presidential
debate, the audience was more interesting than the candidates. This
season`s debate audiences have revealed more about themselves than we have
ever learned from previous debate audiences.

We knew that Republican voters are in favor of the death penalty. We
did not know that contrary to the Christian values that many of them
espouse, they absolutely love the death penalty. Just can`t get enough of
it.

(BEGIN VIDEO CLIP)

WILLIAMS: Governor Perry, a question about Texas. Your state has
executed 234 death row inmates, more than any other governor in modern
times.

(APPLAUSE)

WILLIAMS: Have you --

(END VIDEO CLIP)

O`DONNELL: We also learned that some of these same people, vocal
minority, would gleefully impose the death penalty themselves, on sick
people, if just given the chance.

(BEGIN VIDEO CLIP)

WOLF BLITZER, DEBATE MODERATOR: Who`s going to pay for -- if he goes
into a coma, for example, who pays for that?

REP. RON PAUL (R-TX), PRESIDENTIAL CANDIDATE: In a society that you
accept welfarism and socialism, he expects the government to take care of -
- that`s what freedom is all about, taking your own risk. This whole idea
that you have to prepare and take care of everybody --

(APPLAUSE)

BLITZER: But, Congressman, are you saying the society should just let
him die?

AUDIENCE MEMBER: Yes.

PAUL: No.

AUDIENCE MEMBER: Yes.

(END VIDEO CLIP)

O`DONNELL: At last night`s debate, we learned that the flag pin-
wearing/we support the troops crowd actually despises some of the troops,
including this soldier who asked his question from Iraq.

(BEGIN VIDEO CLIP)

STEPHEN HILL, SERVING IN IRAQ: In 2010, when I was deployed to Iraq,
I had to lie about who I was because I`m a gay soldier and I didn`t want to
lose my job. My question is, under one of your presidencies, do you intend
to circumvent the progress that`s been made for gay and lesbian soldiers in
the military?

(BOOING)

SANTORUM: Yes.

(END VIDEO CLIP)

O`DONNELL: But there is nothing this bloodthirsty merciless mob of
haters hates more than being called exactly what they are -- heartless.

(BEGIN VIDEO CLIP)

PERRY: If you say that we should not educate children who have come
into our state for no other reason than they`ve been brought there, by no
fault of their own, I don`t think you have a heart. We need to be
educating these children because they will become a drag on our society. I
think that`s what Texans wanted to do.

Out of 181 members of the Texas legislature, when this issue came up,
only four dissenting vote.

This was a state issue. Texans voted on it and I still support it
greatly.

(APPLAUSE)

CHRIS WALLACE, MODERATOR: Senator Santorum --

(BOOING)

(END VIDEO CLIP)

O`DONNELL: FOX News pollster Frank Luntz who conducted a focus group
with Republican voters during the debate said, Perry`s defense of the Texas
Dream Act, which allows children of illegal immigrants to pay in-state
tuition rates, if they graduate from a Texas high school and are accepted
in a state university provoked, quote, "the most negative reaction I`ve
seen any Republican candidate have among Republican primary voters."

Only in the twilight zone did this presidential politics 2011 style,
only in that twilight zone could we see a man be cheered for proudly
presiding over the executions of 234 people and then see that same man
booed by the same crowd, booed because that champion of death by execution
called his worshippers heartless.

Campaigns for presidential nominations are sometimes called fights for
the soul of the Republican Party, fights for the soul of the Democratic
Party. No one has used that phrase this time around -- for two reasons.
First, because no candidate fits perfectly into the current shape of
Republican orthodoxy, and, secondly, the Republican Party of the 21st
century, if we are to judge by the debate audiences, has obviously lost its
soul.

Joining me now, Chris Hayes, editor at large for "The Nation" and host
of "UP WITH CHRIS HAYES," weekend mornings here on MSNBC. And Maggie
Haberman, senior writer for "Politico."

Thank you both for joining me tonight.

CHRIS HAYES, HOST, "UP WITH CHRIS HAYES": Good to be here.

MAGGIE HABERMAN, POLITICO: Thank you.

O`DONNELL: Chris, this twilight zone, how can this happen? Here`s
their favorite killer, state-sanctioned killer up there. They boo him
after he calls them heartless.

HAYES: It was such a moment of cognitive dissonance. It was a moment
of cognitive dissonance for a liberal such as myself watching and saying,
you know, I was tweeting, Rick Perry is right on this.

O`DONNELL: Yes.

HAYES: And not only was he right, I thought it was so interesting he
clearly chose the wrong vocabulary to defend the decision, right? First of
all, the way that you defend that policy to that crowd which is essentially
indefensible, in that context, is to talk in a hard headed practical way.
I mean, he sort of got to it in the end, they`re going to be a drag on our
society. That`s the kind of language he used.

You do not defend a policy in this context by pointing to the policy`s
basic compassion. Because compassion -- the ethos of compassion is
absolutely viewed with derision and contempt by the base right now. And I
feel like the Republican base is in kind of a mean mood. I don`t know how
much they`re worked up because they`re at this event and they`re full of
adrenaline, how much it is substantive commitment, but they`re in a mean
mood. You don`t go in front of a crowd in a mean mood and talk to them
about compassion.

O`DONNELL: You know, I personally believe they really mean it on the
death penalty. I think they really mean it on the Dream Act and anything
involving immigration. I think a few of them got carried away on that "let
the guy die in the street if he`s sick and doesn`t have health insurance" -
- I don`t believe that if can came to it they would actually force that.

But, Maggie, you`re down there in Orlando. You`re at the Conservative
Political Action Conference today in Orlando.

Are these people as mean as they sound when they play the audience in
these Republican TV shows?

HABERMAN: No. When you`re dealing with people one-on-one, certainly,
they`re not repeating a lot of what you were hearing in these debates.
However, I think that you will hear from a lot of people privately,
certainly from the campaigns privately, things like the "let him die"
moment did not thrill anybody.

Things like what you saw last night with Rick Perry, that`s a bit
different. I think what Chris said is exactly right, where basically
you`re describing something that`s supposed to be a hard-line issue for the
Republican base right now in very compassionate, quote/unquote, "weak
terms."

And immigration is a hot button issue here. I think it`s not a huge
surprise that debate crowd reacted that way to that. I think there were
other moments that were a little more shocking in some of the debates like
we`ve seen recently like the applause of the death penalty and so forth.

O`DONNELL: All right. Let`s listen to how Mitt Romney followed up at
this today at the Conservative Political Action Conference in Orlando.
Let`s hear what he had to say.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: My friend, Governor Perry,
said that if you don`t agree with his position on giving that in-state
tuition to illegals that you don`t have a heart. I think if you`re opposed
to illegal immigration, it doesn`t mean that you don`t have a heart, it
means that you have a heart and a brain.

(APPLAUSE)

ROMNEY: Legal immigration, good for America. Illegal immigration,
something I will stop if I`m president.

(END VIDEO CLIP)

O`DONNELL: Chris, how thrilled is Mitt Romney to find a spot to the
right of Rick Perry?

HAYES: It`s perfect. He has his chess board all set up, OK? He now
has -- he has his two rooks. One`s on the left and one`s on the right.
The rook on the left he`s going to come up with is Social Security.

He can get to Perry`s left on Social Security. He can reinforce his
moderate bona fides. He can pick "make Perry look unelectable" in the
general election.

And on his right he has his immigration issue which has been dropped
into his lap. And so, he can attack from both sides simultaneously. And
you could see the palpable delight in Mitt Romney`s eyes, the savoring
smile on his face as he went after Rick Perry on this issue with every
buzzword, every kind of, like, dog whistle -- illegals, $100,000, all the
kind of conjuring of liberal distributive justice that the base just
loathes in that response.

O`DONNELL: All right. Now, let`s listen to how Rick Perry picked
himself back up today at the CPAC conference.

(BEGIN VIDEO CLIP)

PERRY: As conservatives we know that values and vision matter. It`s
not who is the slickest candidate or the smoothest debater that we need to
elect.

(APPLAUSE)

PERRY: We need to elect the candidate with the best record and the
best vision for this country.

The model for socialized medicine has already been tried and it
failed. Not just in western Europe, but in Massachusetts.

(END VIDEO CLIP)

O`DONNELL: Maggie, it sounds like he had a better day at CPAC.

HABERMAN: He`s definitely had a better day. The problem for Rick
Perry is more people in the Republican primary electorate will have seen
the debate last night than his debate at CPAC today. And so, last night`s
impression is going to be the one that resonates.

His campaign`s line is going to be to get more aggressive with Mitt
Romney, try to define him better than they have. Try to go after him on --
you know, as Chris said, he`s attacking from the left and right. That does
invoke the problem to Mitt Romney of flip-flopping and being all things at
once. You`re going to see a lot more of that.

For Rick Perry, things are getting to know him. And the impressions
from things like debates really do stick. So, I`m not sure saying we`re
not electing the smoothest debater, we`re not electing the person who
communicates the best, I don`t know that`s quite going to cut it.

O`DONNELL: Chris, what to you think Perry has to do now to do now --
because he`s going to have to deal with debating. Sure, he can read a
speech. His writers did a fine job for CPAC. That`s not the problem.

What does he do?

HAYES: Oh, he`s got to bone up. I mean, it`s hard -- I mean, you
know, I now talk on television for a living. It`s tough.

O`DONNELL: Doesn`t he have to somehow walk away from some of his past
on immigration and walk away from some of his past on Social Security while
pretending he`s not?

HAYES: You know, yes, he does and he finally -- so he finally got the
HPV answered. This is one silver lining for him. He got the HPV answer
finally right after trying it 10 times last night. He said it was about
life and I got lobbied by a young woman who had cervical cancer. And he
framed it in the terms of life. He said this is a pro-life decision. And
I thought he actually did a good job with that answer. He sort of put it
to bed.

He`s got to come up with those answers particularly for the state
Dream Act. And the other thing he has to do that no one in the field has
been able to do is kind of distill and make stick the anti-Romneycare
argument. That it`s been out there forever. I personally thought it would
be -- it would really mean the death of his candidacy. I did not think he
could overcome it in the moment of the most intense hatred toward the
Affordable Care Act. How could Mitt Romney distance himself from his
signature policy achievement when it`s so closely related to the
president`s?

And somehow he`s been able to. I think it`s still on the table for
whoever can grab it, finding the argument that lands on Romneycare.

O`DONNELL: I thought Romney care was the cancer in the Romney
candidacy. I thought every one of them had something wrong with them.
Romney`s was devastating.

But we`re out of time for this segment. Chris, what do you have
coming up tomorrow morning?

HAYES: Tomorrow, you`re going to talk to the great economist Robert
Frank about taxes and inequality.

O`DONNELL: And you`re going to do that at 7:00 a.m.?

HAYES: I`m going to do that at 7:00 a.m. I`m going to be well-
caffeinated for that discussion. We`re going to have Anne-Marie Slaughter
who used to run the policy planning at the Department of State. She will
be my guest as well.

O`DONNELL: Chris Hayes and Maggie Haberman, thank you both very much
for joining me tonight.

HABERMAN: Thank you.

HAYES: Thanks, Lawrence.

O`DONNELL: Coming up next, after last night`s debate, Republicans are
more worried than ever that they don`t have a winning presidential
candidate.

And later, first, he denied his plan to tax the rich as class warfare
and now, the president says he`s a happy warrior for the middle class. The
president rewrites himself in the "Rewrite" tonight.

(COMMERCIAL BREAK)

O`DONNELL: Republicans insist that President Obama`s policies hurt
small business in this country. But that`s not what you hear if you
actually listen to small business. We`ll talk with a real live job creator
in the "Spotlight."

And next, is the prospect of Mitt Romney or Rick Perry being a
Republican nominee so scary that Chris Christie can be convinced to run for
president? Eugene Robinson joins me next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PERRY: I think Americans just don`t know sometimes which Mitt Romney
they`re dealing with. Is it the Mitt Romney that was on the side of --
against the Second Amendment before he was for the Second Amendment? Was
it before -- he was before the social programs from the standpoint of he
was for standing up for Roe v. Wade before he was against Roe v. Wade. He
was for race to the top. He`s for Obamacare and now, he`s against it.

(END VIDEO CLIP)

O`DONNELL: That was Texas Governor Rick Perry manfully struggling to
deliver an obviously rehearsed but I guess under-rehearsed bit of material
about his opponent Mitt Romney. In that moment, Governor Perry managed to
demonstrate what a weak debater he is and what a flip-flopper Mitt Romney
is. The debate left some Republican commentators in a near panic.

Today, FOX News commentator Bill Kristol wrote in "The Weekly
Standard," "`The Weekly Standard`s` official reaction to last night`s
Republican presidential debate: Yikes."

Kristol said that Perry`s debate performance was, quote, "close to a
disqualifying two hours for him" and Kristol called Romney, quote, "a
technocratic management consultant whose one term as governor produced
Romneycare."

During the debate, Ann Coulter tweeted, "Governor Perry losing debate
with his own tongue."

Last night`s debate led to another call for New Jersey Governor Chris
Christie to enter the race. "The Wall Street Journal`s" Paul Gigot argues
in his column that the GOP nomination is still up for grabs and there for
the taking for Governor Christie.

Governor Christie appeared yesterday with Indiana Republican Governor
Mitch Daniels at Rider University in New Jersey. Both governors
disappointed their fans when they announced earlier this year that they
definitely will not run for president.

Christie offered his thoughts on why Republicans still want him to
run.

(BEGIN VIDEO CLIP)

GOV. CHRIS CHRISTIE (R), NEW JERSEY: I think what the country is
thirsty for more than anything else right now is someone of stature and
credibility to look them in the eye and tell them that. And say, here`s
what I want us to go to deal with this crisis. And the fact that nobody,
yet, who`s running for president, in my view, has done that effectively is
why you continue to hear people ask Daniels if he`ll reconsider and ask me
if I`ll reconsider.

(END VIDEO CLIP)

O`DONNELL: Joining me now, "Washington Post" columnist and MSNBC
analyst, Eugene Robinson.

Thanks for joining me tonight, Gene.

EUGENE ROBINSON, WASHINGTON POST: Great to be here, Lawrence.

O`DONNELL: Gene, as you know, the reviews are in from Republicans
about this Republican debate. John Podhoretz in "The New York Post" today
on Perry says, "Awful, just awful. After the first half hour, he seemed
unable to speak a coherent sentence even when he was carefully prepared."

I could go on and on. It doesn`t get worse than this.

What are the Republicans going to do? They thought for a very brief
period, a few weeks, a couple of weeks, Perry`s here, finally we have our
guy.

ROBINSON: Yes, they did. I mean , we`ve seen this movie before. The
movie we`re seeing now, it`s like -- Christie, please, we need Christie.
They were doing that about Perry a few weeks ago. And Perry gets in the
race and, all of a sudden, he is -- frankly, let`s just say it, it`s a huge
disappointment right now certainly to the Republican professional political
establishment that thinks he`s going to get eaten alive on the campaign
trail and in debates by President Obama. They see an opportunity to take
the White House this time with the right candidate, and they don`t think
they got it.

O`DONNELL: It`s too much fun reading these Republican reviews, Gene.
I`m going to give you one more. Erick Erickson from conservative blog
"RedState," he writes today, "Rick Perry stands on the precipice. Another
performance like last night could push him off the edge of support of
people who want an anti-Romney alternative but who really want to beat
Barack Obama even more."

Gene, this is -- this is their nightmare. They thought they -- you
know, there was something wrong. They could see it. There was something
wrong with Romney because of Romneycare. There was something wrong with
each one of these candidates.

Finally, here comes Perry. He`s perfect. That didn`t last long.

ROBINSON: No, it didn`t last long. And, you know, the old saying
used to be, Democrats fall in love with their candidates and Republicans
fall in line.

And that`s kind of flipped now. And the Republicans want to fall in
love. They want the perfect candidate, and I was going to say the perfect
guy. It`s probably going to be a guy.

And that person I think is not around. The Republican Party right now
is a kind of a confusion -- it`s a ball of confusion in some ways. You`ve
got the establishment, you`ve got the Tea Party bridging that divide
wouldn`t be easy for the most dexterous politician, which Rick Perry I
think is not.

And so, I don`t know that Chris Christie, if he were to wade into the
race would be able to bridge it either.

O`DONNELL: Well, that`s the thing. I mean, all these guys look great
until they step in. And I think Christie has been very convincing in his
language about not going to run for president. He`s found every absolutely
clear way to say it and he`s said it. No hedging there. Mitch Daniels
absolutely dropped out. You know, isn`t going to do it.

And so, it`s reasonable at this point to say, this is the field and
there are two front-runners. It`s going to be Romney or Perry.

The Obama campaign, it seems, would probably be better off with Perry.
That`s what Steve Schmidt has said on this network that -- and the polling
indicates they`d be better off with Perry so far.

Do you think that`s what the Obama campaign is rooting for at this
point? Obama versus Perry?

ROBINSON: Yes. I do think they would rather see Obama versus Perry.
Although it seems to me that they`re still kind of trying to lay groundwork
for Obama versus Romney. They seem to think that in the end, it`s probably
going to be Romney.

And if Perry continues at this rate, they`ll be right, I think.
Romney is turning in solid performance after solid performance in the
debates. They might be "B" performances or "B" plus. They`re not "A"
plus. But he`s a good debater.

And he manages to put the focus on Perry and not the focus on his own
flip-flops, on Obamney care, on the reasons that Republicans really don`t
like him that much. And, you know, the more he sticks around, the more he,
I think, might come to seem inevitable.

O`DONNELL: And Romney, Gene, has been running for president for more
than five years now. Perry`s been at it for about five weeks. That
difference is really showing now.

ROBINSON: It sure is. Romney is a much better candidate than he was
last time around. He kind of knows how to do this. Rick Perry clearly
does not. And he needs to be on an extremely steep learning curve because
basically the next -- of course, there are a million Republican debates,
but in the next debate or so, he had better perform, you know, with a lot
more skill and verbal dexterity than he has up until now -- or I think that
we`re going to see this front-runner status really start to come down.

People -- this immigration issue, especially, is really going to hurt
Perry and it is, as Chris Hayes observed, in my opinion, it`s an issue on
which Perry is right. But it`s certainly a position that`s highly
unpopular with the Republican base. And that, plus his fumble-mouthedness
might seal his doom.

O`DONNELL: Now, it doesn`t look like there are any points to be
scored by being right in this Republican primary. "Washington Post"
columnist Eugene Robinson -- thank you very much for joining me tonight.

ROBINSON: Great, Lawrence. Have a good weekend.

O`DONNELL: Thank you. You, too.

ROBINSON: Coming up, we take a look at the Republican myth that
President Obama is the worst thing that`s ever happened to small business.
Instead of talking to a politician about small business, we will try the
novel approach of talking to someone who has actually created a small
business.

And President Obama takes if not a page, at least a paragraph out of
Elizabeth Warren`s campaign playbook. That`s in the "Rewrite."

(COMMERCIAL BREAK)

O`DONNELL: President Obama succeeded in getting a piece of
legislation passed this month. The Senate voted 89 to 9 to reform
America`s patent policy, reversing two centuries of rules that President
Obama said were hurting America`s economy by forcing inventors to have a
finished product before getting a patent.

The President says the U.S. will now catch up with many European and
Asian countries. Still ahead in this hour, Republicans keep saying that
President Obama`s policies hurt job creation, hurt small businesses and
hurt entrepreneurs. Up next, we`ll hear from an entrepreneur whose book on
starting companies is now number 2 on the New York Times Best Seller list.

And, in the (INAUDIBLE) Elizabeth Warren helps the president rewrite
his response to the Republican chant of class warfare. And, tonight, the
late night comedians will get the last word.

(VIDEO CLIP)

CONAN O`BRIEN: President Obama is visiting the home town of House
Speaker John Boehner. Yeah, Obama plans to give a speech then visit the
tanning bed that Boehner grew up in.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(VIDEO CLIP)

RICK PERRY, GOVERNOR OF TEXAS (R): Nearly 2.5 million of our citizens
have lost jobs under this administration. Four trillion dollars in debt
has been added to our children`s burden, one in six work eligible Americans
cannot even find a job. In Washington they call this a recovery. In the
rest of America we call it a failure.

(END VIDEO CLIP)

O`DONNELL: That was Rick Perry speaking at today`s Conservative
Political Action Conference. At last night`s debate, both Rick Perry and
Mitt Romney joined the Republican chant to get big bad government off the
back of the biggest job creator in America, the small business owner.

(VIDEO CLIP)

PERRY: If you look at the State of Texas and see what we`ve done
there from the standpoint of lowering that tax burden, the regulatory
climate in the State of Texas. We`ve taken those types of regulations off
of the throat of small business operators.

MITT ROMNEY, FORMER GOVERNOR OF MASSACHUSETTS (R): Our corporate tax
rates, our employer tax rates have to be competitive. Small business pays
at the highest rate. We need to get those rates down to globally
competitive levels. Number two, government and regulators have to be
allies of business, not foes.

(END VIDEO CLIP)

O`DONNELL: There is no group that is more publicly worshiped and
mythologized by Republican presidential candidates than small business
owners. You will be hearing about small business owners every day for the
next year of presidential campaigning. So, tonight, we`ve decided to try
talking to someone with small business experience.

Joining me now, Eric Ries, entrepreneur, in residence at the Harvard
Business School and author of The Lean Startup, how today`s entrepreneurs
use continuous innovation to create radically successful businesses. Eric,
I`m confused. I`m -- I`m -- here we are. I`m in the table of contents
here of The Lean Startup.

There`s part I - Vision, part II - Steer, part III - Accelerate.
You`ve got 12 chapter titles, one word. You have Chapter 1 - Start,
Chapter 2 - Define, Learn, Experiment, Leap, Test, Measure, Pivot, Batch,
Grow, Adapt, Innovate, Epilogue. Where`s taxes? What chapter -- oh, oh,
oh index. Allright. I`ve got you. It`s going to be huge in the index,
right? Ok, let`s see. Tastefully simple. Tax return innovation, page
29-31. Let me get this straight, 300 pages, taxes are three pages of this
book?

ERIC RIES, AUTHOR: That`s absolutely right.

O`DONNELL: Wait a minute.

RIES: It can be.

O`DONNELL: But it`s everything. It`s all small businesses think
about is taxes are killing me, taxes -- I mean, Rick Perry has taxes and
government regulation at the throat of small business. How did you miss
that?

RIES: I don`t know. I didn`t -- I didn`t get the memo. Since the
book came out a week ago I`ve been on book tour. I`ve been in cities all
over the country and I`ve talked to literally thousands of entrepreneurs
and marginal tax rates has not come up even one time in my conversations
with entrepreneurs. I don`t know any entrepreneurs in this (INAUDIBLE)
boom that`s happening right now that are worried about what marginal tax
rate they might pay, will it be 33 percent or 35 percent when they finally
become the next Facebook and make a billion dollars. It`s not on anybody`s
mind.

O`DONNELL: And, when Warren Buffett talks about his experience in
business he says he doesn`t know anyone at the investment, his level of the
game, who`s ever made a decision about investment based on what the tax
would be on whatever profit they made from the investment.

RIES: Yes, I don`t really understand who would be thinking that way.
Because entrepreneurship is so difficult, so unlikely to be successful in
the first place, the last thing you`ve got to worry about is, you know,
what will the, you know, tiny changes in the tax return you`ll have to pay.
Most of us who`ve had a chance to write a big check to Uncle Sam, like Mark
Cuban said the other day, felt like it was our patriotic duty. It was
actually pretty exciting.

O`DONNELL: And -- and what we`re talking about here, they keep
talking about how, if you change the top personal income tax rate you will
hurt small business and small business creators tremendously by moving it
from 35 to 39.5 percent. By moving it 4.5 points, leaving all the
deductions in place and all the ways in which business and individuals have
of actually reducing their effective rate. Why, in the 1990s, when we did
that, when we had a 39.5% top tax rate, why was business booming?

RIES: What`s really driving entrepreneurship are technological and
management changes that have been happening over the past few decades that
are making it easier and cheaper to start a company and, therefore, making
entrepreneurship available to people who never would have been able to try
it before. I`d go so far as to say entrepreneurship is now a career you
can pursue. And, that`s very exciting.

That means a lot more people pursuing entrepreneurship. I think there
are more startups operating today than at any time in history and so the
overall economy is grim and there are certainly employment challenges, in
the startup hubs places like Silicon Valley where I`m from, we have so much
entrepreneur activity people are worried it might even be a second bubble.

O`DONNELL: In your checklist of -- of creating a new business, where
would -- of things you have to do -- ok, where would get government off my
back be? Would that be number one, number three, number 300?

RIES: There certainly are regulatory things the government can do to
encourage people to become entrepreneurs but those things are not on
entrepreneurs` minds. We`re focused exclusively on how do we create a
great product and how do we serve customers in the service of building a
long-term viable business?

And the book is really about how do we run those experiments cheaply,
quickly, to learn what`s working and what`s not? There are regulatory
things government can do. Certainly, making it so that you don`t lose your
health care if your company fails. Certainly, making it so that big
companies can`t file a bunch of bogus patents and put you out of business.

Things that are actually pro-growth like investing in common
infrastructure, things like the Internet and GPS. Those are government
innovations that have helped a lot of entrepreneurs build a lot of jobs.

O`DONNELL: You want to know something about small business, ignore
the Republican presidential candidates, read The Lean Startup. That`s what
you`ve got to do. Entrepreneur and author of The Lean Startup, Eric Ries,
thank you very much for joining us tonight.

RIES: Thank you so much.

O`DONNELL: Coming up, Massachusetts Senate candidate Elizabeth Warren
rewrites the Republican accusation that the president`s plan to make the
tax code more fair is class warfare. That`s next. And, later, the late
night hosts tackle the president`s deficit reduction plan, the repeal of
don`t ask, don`t tell, and, of course, last night`s Republican date. The
week in comedy is coming up.

(COMMERCIAL BREAK)

O`DONNELL: Still ahead, the late night comedians take on the
political war over class warfare. The best of the week in comedy is coming
up. And, we will see how Elizabeth Warren helped rewrite the president`s
response to the Republican chant of class warfare. That`s going to be next
in the rewrite.

(COMMERCIAL BREAK)

O`DONNELL: Time for tonight`s rewrite. When President Obama brought
his Jobs Bill to Congress and announced that he wanted to pay for it by
making the tax code more fair, by imposing what he called the Buffett rule
so that billionaires like Warren Buffett would no longer pay lower income
tax rates than their middle class employees, Republicans did not bother to
address the details in the president`s plan. The Republican`s rebuttal was
a two word slogan.

(VIDEO CLIP)

UNIDENTIFIED MALE: Class warfare.

UNIDENTIFIED MALE: Class warfare.

UNIDENTIFIED MALE: Class warfare.

UNIDENTIFIED MALE: Class warfare.

UNIDENTIFIED MALE: Class warfare.

UNIDENTIFIED FEMALE: Class warfare.

UNIDENTIFIED MALE: Class warfare.

(END VIDEO CLIP)

O`DONNELL: At first, the president responded in classic Obama style
with logic and with, of course, the mandatory denial that it was class
warfare.

(VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: This is not class
warfare. It`s math. The money`s going to have to come from someplace and
if we`re -- we`re not willing to ask those who`ve done extraordinarily well
to help America close the deficit and we are trying to reach that same
target of $4 trillion then the logic, the math, says everybody else has to
do a whole lot more.

We`ve got to put the entire burden on the middle class and the poor.
We`ve got to scale back on the investments that have always helped our
economy grow. We`ve got to settle for second rate roads and second rate
bridges and second rate airports and -- and -- and schools that are
crumbling. That`s unacceptable to me. That`s unacceptable to the American
people and it will not happen on my watch.

(END VIDEO CLIP)

O`DONNELL: Then, a rookie Senate candidate in Massachusetts showed
the president that he could have a little more fun with this, that he could
breathe a little more fire into his response.

(VIDEO CLIP)

ELIZABETH WARREN, SENATE CANDIDATE, MASSACHUSETTS: I hear all this,
you know, well this is class warfare, that`s what -- no, there is nobody in
this country who got rich on his own. Nobody. You build a factory out
there, good for you, but I want to be clear. You moved your goods to
market on the roads the rest of us paid for. You hired workers that the
rest of us paid to educate.

You were safe in your factory because of police forces and fire forces
that the rest of us paid for. You didn`t have to worry that marauding
bands would come and seize everything at your factory and hire someone to
protect against this because of the work the rest of us did.

Now look, you built a factory and it turned into something terrific or
a great idea. God bless. Keep a big hunk of it but part of the underlying
social contract is you take a hunk of that and pay forward for the next
(INAUDIBLE) who comes along.

(APPLAUSE)

(END VIDEO CLIP)

O`DONNELL: Ok, so the marauding bands thing might have been a little
too much but the president and his speech writers were listening and then
they rewrote his position on class warfare.

(VIDEO CLIP)

OBAMA: You can make millions, you can make billions of dollars in
America. This is the land of opportunity. That`s great. All I`m saying
is, if you`ve done well, I`ve done well, then, you should do a little
something to give something back. You should want to see the country that
provided you with this opportunity to be successful and be able to provide
opportunity for the young people who are going to be up -- coming up behind
you.

Now the Republicans, you know, when I -- I talked about this earlier
in the week. They said, well, this is class warfare. You know what, if
asking a billionaire to pay their fair share of taxes, to pay the same tax
rate as a plumber or a teacher is class warfare, then, you know what, I --
I -- I`m a warrior for the middle class. I`m happy to fight for the middle
class.

(END VIDEO CLIP)

O`DONNELL: So the president goes from the safe political position of
denying that it`s class warfare to declaring himself a happy warrior for
the middle class and he does this in a matter of days and he does it after
using the Elizabeth Warren idea about how the rich should pay it forward.
Then, the president adds his own rhetorical flourishes and improvements.
The happy warrior for the middle class. If we want to know what the
candidate Obama is going to say next, maybe we should keep an eye on
candidate Warren.

(COMMERCIAL BREAK)

O`DONNELL: The war over class warfare, the end of don`t ask, don`t
tell, and another Republican debate gave the late night comedians and their
writers everything they needed this week.

(VIDEO CLIP)

JAY LENO, THE TONIGHT SHOW, HOST: There was another big Republican
debate tonight in Orlando, Florida. This one was sponsored by Google --
was sponsored by Google, which is tricky for Rick Perry because, you know,
he`s a yahoo. So that`s kind of --

Actually, you know, Orlando is the home of Disney World. Well, that`s
the perfect fit for these candidates, I mean, Mitt Romney is Prince
Charming, Ron Paul is Grumpy, Rick Perry is Dopey and Michele Bachmann
thinks she`s Snow White, so it`s magical.

(END VIDEO CLIP)

UNIDENTIFIED MALE: Yesterday, Obama unveiled his deficit reduction
plan with yet another fiery speech from the Rose Garden. By taxing the
rich, there is a name for what Obama is trying to do here.

(VIDEO CLIP)

HOUSE SPEAKER JOHN BOEHNER: I don`t think I would describe class
warfare as leadership.

(END VIDEO CLIP)

UNIDENTIFIED MALE: Yes, it is class warfare. And that is unfair for
rich people who, generally speaking, would prefer not to fight our wars.

(VIDEO CLIP)

OBAMA: This is not class warfare. It`s math.

(END VIDEO CLIP)

UNIDENTIFIED MALE: Since when -- since when does math settle
anything? Like evolution, I believe math is just a theory.

JON STEWART, THE DAILY SHOW, HOST: That`s how you`re going to sell
your program to Americans? You`re going to love it, it`s not war, the
thing we`re best at, it`s math, the thing we`re 32nd out of 65 in the world
at. Or, as we like to think of it, the top 10 percent.

BILL O`REILLY, THE O`REILLY FACTOR, HOST: If Barack Obama begins
taxing me more than 50 percent, which is very possible, I don`t know how
much longer I`m going to do this. I like my job but there comes a point
when taxation becomes oppressive.

STEWART: So, if taxes are raised, Bill O`Reilly might quit his FOX
job? Well, that -- that bring us to our new segment. No. Stop. Bill.
Don`t. Please. No.

JIMMY FALLON, LATE NIGHT WITH JIMMY FALLON, HOST: According to new
reports, House Speaker John Boehner has accepted money from BP to support
his campaign, while Mitt Romney has accepted oil from BP to support his
hairdo.

CONAN O`BRIEN, CONAN, HOST: Today, President Obama is visiting the
home town of House Speaker John Boehner. Yes. Obama plans to give a
speech and then visit the tanning bed that Boehner grew up in.

STEWART: And if you`re watching this show from a military base and
you`ve noticed that your fellow soldiers seem somewhere between two to ten
percent happier today.

(LAUGHTER)

.the figures are very hard to -- to get, there`s a reason.

UNIDENTIFIED FEMALE: (INAUDIBLE) today the policy that banned gays
from serving openly in the military is now history.

UNIDENTIFIED MALE: From now on, gays can serve openly in the military
and the 13,000 who were discharged under don`t ask, don`t tell can re-
enlist.

STEWART: That`s how ridiculous this policy was. The apology for the
affront is, all right, sorry, you can go to Afghanistan and fight for your
country. They`re lucky it was gay people that they discharged from the
Army. Only gay people would remain in good enough shape to be able to re-
enlist.

O`BRIEN: Now that don`t ask, don`t tell has been repealed, the
Marines -- this is true, the Marines said they want to recruit the most gay
soldiers of any branch of the military. That`s true. The Marines said
they -- yes, yes, when the Navy heard this they said, "Oh bitch, it is on."

The Tea Party, did you hear what the Tea Party is up to now? The Tea
Party is forming its own debt Super Committee, a super committee on debt
that`s going to meet this week at a Florida Denny`s. Yes. Trust me. You
do not want to be the waiter who has to add the tax to their check.
(INAUDIBLE) Socialists.

(END VIDEO CLIP)

O`DONNELL: The late night comedians get the last word for Friday.
It`s going to be a big week here on The Last Word next week. On Thursday,
former presidential Tim Pawlenty, my former favorite Republican
presidential candidate, will make his debut right here on The Last Word.
He will explain to me why he dropped out after I predicted he had the best
chance of actually winning the Republican nomination. Does he wish he was
back in there now? You can have The Last Word online at our blog,
thelastwordmsnbc.com. You can follow my Tweets @Lawrence. The Rachel
Maddow Show is up next. Good evening Rachel.

END

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