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'The Rachel Maddow Show' for Thursday, December 8th, 2011

Read the transcript to the Thurday show

Guest: Frank Phillips


ED SCHULTZ, "THE ED SHOW" HOST: I think it`s very, very dangerous. I
cannot believe this is happening in America.

Good to have you with us tonight. That`s "THE ED SHOW." I`m Ed
Schultz.

Next up, THE RACHEL MADDOW SHOW.

Rachel, great to have you with us tonight. Good to see you.

RACHEL MADDOW, HOST: Thanks very much, Ed. I`m going to be covering
a little bit further on that story you that just covered tonight about
Michigan. I agree with you that I think this is probably the biggest story
in the country.

SCHULTZ: Look, if Michigan gets away with this, if they get away with
this, then the next radical governor`s going to try it, and you know where
it`s all going to go. It`s just absolutely amazing.

MADDOW: More ahead on that subject this hour. Thanks a lot, Ed.
Really appreciate it.

SCHULTZ: Thanks, Rachel.

MADDOW: And thanks to you at home for staying with us through the
next hour.

All right. Let`s just level with each other about this because we all
know the truth, and that`s that polls are boring. I mean, I realize that
polls less than a month out from the Iowa caucuses are important in terms
of understanding what`s going on in the race for the presidential
nomination and the presidential nomination is a really important thing.

But polls are boring -- especially when there are important minute
details between each of these polls that come out now in big bunches every
single day, including on weekends. Keeping track of all the finite
distinctions, which are important and which aren`t important, it can be a
little glazing.

Fortunately, today is one of those days when understanding the polls
is very simple. Here`s what`s going on in the polls right now. Are you
ready?

This is what`s going on in the polls. Yes, that`s pretty much it.

The new national Gallup poll shows Newt Gingrich up by nine. Florida
Quinnipiac poll Newt Gingrich up by 13. Florida Survey USA poll, Newt
Gingrich up by 22. Ohio Quinnipiac poll, Newt Gingrich up 18.
Pennsylvania Quinnipiac, Newt Gingrich up by 14. Georgia poll by Survey
USA, Newt Gingrich up by 53.

He`s not winning 53 percent of the vote in that poll in Georgia. He`s
winning by a 53-point margin in Georgia. And yes, that is his home state.

But if you have not been relishing the prospect of keeping up on all
the little details of all the different polls, at this point, you don`t
have to. Not today. There are no details. It`s only one story.

Actually, if you are interested in absorbing just one nuance in the
polls, that national polling number for Newt Gingrich from Gallup, that
shows him with a nine-point lead over Mitt Romney today, that lead was 15
percent over Mitt Romney just a few days ago. So there has been a down
tick in Mr. Gingrich`s national Gallup prospects in the last few days. But
still, he`s nine points ahead right now nationwide.

And that lead that Mr. Gingrich -- that uncomplicated lead that Mr.
Gingrich has jumped out to, that frankly explains this.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I think people understand
that I`m a man of steadiness and constancy. I don`t think you`re going to
find somebody who has more of those attributes that I do. I`ve been
married to the same woman for 25 -- excuse me, I`ll get in trouble -- for
42 years.

I`ve been on the same church my entire life. I worked for one
company, Bain, for 25 years and I left that to go off and help save the
Olympic Games.

If I`m president of the United States, I will be true to my family, to
my faith, and to our country, and I will never apologize for the United
States of America.

I`m Mitt Romney, and I approve this message.

(END VIDEO CLIP)

MADDOW: Mitt Romney was probably going to run as a family values guy
anyway. They all do. But what better time to start the family values part
of the campaign than when Newt Gingrich shoots by you in the polls with his
third wife in tow?

The thing that has Democrats really excited about Mitt Romney today,
though, is that Mr. Romney`s newfound energy, the get up and go in his
campaign that seems to be inspired by Newt Gingrich beating him all over
the country now has caused Mr. Romney to throw caution to the wind on a
really important thing.

Earlier this year, all but five Republicans in the House and seven
Republicans in the Senate, the overwhelming majority of congressional
Republicans, voted for something so politically toxic it makes Democratic
operatives break out in spontaneous applause whenever you bring it up.

Republicans voted for the Paul Ryan budget, the kill Medicare budget.
Dave Weigel at Slate.com reports that Paul Ryan is lobbying right now -- in
this video right here -- lobbying that anybody saying his plan kills
Medicare should be accused of telling the lie of the year in politics.

The thing is the Paul Ryan budget does kill Medicare. Instead of
Medicare, old people will have a system where they have to buy private
insurance on the private market, and Paul Ryan will give them coupons to
get discounts.

So, if you want to call a system like that Medicare, telling granny to
go buy private insurance on the open market but with a coupon, then sure,
call it Medicare. Call it macaroni. I don`t care.

But what everybody understands Medicare to be, guaranteed government
health insurance for old people, for what Medicare actually is, the Paul
Ryan plan kills Medicare.

When almost every Republican in the House and the Senate voted to kill
Medicare, when they voted for the Paul Ryan plan, there was much rejoining
on the Democratic side, and that`s because Democrats knew they could stop
this thing from actually becoming law. President Obama would never sign
anything like that.

But they also knew that Republicans had just hung this giant albatross
around their own necks. For the rest of their careers now, they will have
to explain or live down or apologize for the fact that they voted in 2011
to kill Medicare.

Senator, the mob from the nursing home with pitchforks is here.
They`d like to have a word with you. Thank you.

At the start of the Republican presidential campaign, we spent weeks.
Jaws dropped, eyebrows raised, agape as all of the major Republican
candidates for president one by one swallowed hard and said that yes, they
too would have voted with congressional Republicans for the Paul Ryan plan
to kill Medicare.

Newt Gingrich initially said he wouldn`t. He called it right-wing
social engineering on "Meet the Press." Remember?

But after a right-wing uproar, Mr. Gingrich caved immediately and
said, oh, OK, he was on board too.

The only candidate who hedged, the only one who squirmed away from the
issue for weeks, we asked his campaign repeatedly for weeks what his
position was on it. And he squirmed out of it. He wouldn`t answer. The
only one of them who seemed smart enough to hold off, to try to at least
avoid answering the "would you kill Medicare" question, was Mitt Romney.
And that`s over now.

Now, Newt Gingrich is beating Mitt Romney in almost every poll across
the country. Did I mention the 53-point margin in Georgia?

And so, Mr. Romney has decided to go after Newt Gingrich who initially
said something about the Paul Ryan plan before changing his mind. But in
so doing, in attacking him for that, in order to appear un-flip-floppy in
contrast to Mr. Gingrich, Mitt Romney has now stopped hedging on this issue
finally. And in no uncertain terms he has declared, he has put it in
print, we`ll just show you on his Web site.

Look. Quote, "As president, Mitt Romney would sign the Paul Ryan
plan."

That sound you hear is spontaneous applause throughout blue America.
Greg Sargent of the "Washington Post" compiled some of that glee today.
Bill Clinton`s former chief strategist Paul Begala saying, quote, "The fact
that Mitt Romney would call for essentially ending Medicare should
disqualify him from the presidency in the eyes of millions of middle-class
voters."

A Democratic operative e-mailed a one word response to Greg Sargent.
The one word? "Rejoicing."

Steve Benen at "Washington Monthly" added, quote, "This is the line
Democrats have waited eight months for Romney to take."

I think we will look back and see this as a banner day when the
general election comes around, or at least when Mitt Romney drops that off
his Web site and pretends it was never there. We`re going to see this is a
big deal in the general election, because unless there is some miracle, and
it`s neither Newt Gingrich nor Mitt Romney nominated, if one of those two
guys is nominated, the Republican nominee for president is going to be a
guy who wants to kill Medicare. It`s going to be a guy who says he will
kill Medicare.

So here`s your coupon instead of your Medicare, grandma. Ow, ow.
Pitchforks hurt. Ow.

So Democrats are very excited today for what the dynamics of the
Republican primary have caused Mitt Romney to step in. I mean do.

But the first voting of course is in Iowa. Less than four weeks away.
And you know who else is right up there in the polls in Iowa alongside Mr.
Gingrich and Mr. Romney? It`s Ron Paul.

And Ron Paul`s campaign is taking a turn as well. Since Mr. Gingrich
started surging, Ron Paul has been running a series of pretty blistering
anti-Newt Gingrich ads.

But this week, Ron Paul also started running ads for himself as an F-
150 truck. Here`s the Ford F-150 truck ad. You have probably seen this
before.

(BEGIN VIDEO CLIP)

NARRATOR: OK. Odds are if you`re one of the people in America with a
pickup truck, it ain`t a luxury, it`s a way of life. And chances are,
you`re not making your money pushing a pencil or hand modeling. You`re
actually working for every dollar and need your truck.

(END VIDEO CLIP)

MADDOW: So, that`s the F-150 ad. That`s just for comparison`s sake.

Now here`s the Ron Paul ad.

(BEGIN VIDEO CLIP)

NARRATOR: What`s up with these sorry politicians? Lots of bark.
When it`s showtime, whimpering like little shih tzus.

You want big cuts? Ron Paul`s been screaming it for years.

Budget crisis? No problem. Cut a trillion bucks year one. That`s
trillion with a t.

Department of education, gone. Interior, energy, HUD, commerce, gone.
Later, bureaucrats.

That`s how Ron Paul rolls.

(END VIDEO CLIP)

MADDOW: What are you, some kind of hand model? No, the F-150 is a
very popular vehicle. I have one myself.

So maybe this ad will also popularize Mr. Paul, make him as ubiquitous
as an F-150.

The ad did already get him onto the Conan O`Brien show.

(BEGIN VIDEO CLIPS)

CONAN O`BRIEN, COMEDIAN: Check out Ron Paul`s other new ad that was
released just a couple of hours ago.

VOICE: I got a little deficit. Wah.

ANNOUNCER: Put a sock in it, America. This country needs a budget
enema. Only one candidate has the sac to get the job done. Ron Paul.

You want cuts? You got them. He`ll cut one skrillion dollars of
gocht spending week one. That`s skrillion with a skrill.

Department of Health, gone. Food stamps, gone. Regular stamps, gone.
Roads, bridges, power grid, gone, gone, gone!

Then, every U.S. citizen will be given a rusty pipe to fend off an
army of starving marauders and a cleansing blood will run through the
streets.

(END VIDEO CLIPS)

MADDOW: Ron Paul? Mission accomplished, sir. You have changed the
conversation.

As for the other candidates in the race, in this late Gingrich surge
period we`re in right now, Jon Huntsman, former Utah governor, frankly
seems to be winding down his campaign. Jon Huntsman gave a speech today in
Washington, D.C. that took on his opponents, but it was billed by his
campaign as a closing argument. You don`t have to go home, but you can`t
stay here.

Rick Santorum, bless him, said today he will have a big announcement
tomorrow in Iowa. There are no indications that the big announcement is
that he`s quitting. But it`s never a good sign that when you say you`re
having a big announcement the first thing everybody asks is, are you
quitting?

Governor Perry of Texas, an underappreciated fact of his campaign is
that he`s still got a lot of money left over from the time when he seemed
viable. Mr. Perry is using that money to make and run a bunch of new ads
that are really bluntly old school right wing.

Today`s ad is on health care, and it ends with him calling both Mitt
Romney and Newt Gingrich, "big government liberals." The ad before this
from Mr. Perry was his big anti-gay gambit, complaining about "don`t ask,
don`t tell" being repealed.

This is risky on one level because the repeal of "don`t ask, don`t
tell" is actually very popular, it polls very well. But it`s risky on a
whole other level because Rick Perry did his anti-gay ad while wearing the
Heath Ledger jacket from the heart-warming gay cowboy movie "Brokeback
Mountain" -- which is the best mime on Twitter in at least a week.

See? It`s a thing now. Well done, Governor. You`re a thing.
Everywhere.

Links to that Tumblr that produced that and others at Maddow Blog
right now.

But as for the front-runner, as for Mr. 53 points ahead in Georgia,
Newt Gingrich is using his front-runner status to make a little cash. Not
for his campaign. For himself.

As noted in the "New York Times" and the "Washington Post" today, the
only event on Mr. Gingrich`s public schedule for tomorrow is a Washington,
D.C. book-signing at Hudson News bookstore, which means that he will not be
campaigning. Less than four weeks from Iowa, he`ll be selling books on the
East Coast to make money for himself.

On Saturday, he has to go to Iowa because there`s some debate that
he`s in. Drag. But before that debate, Mr. Gingrich, quote, "plans to
squeeze in an afternoon book signing" to make himself some more money.

Even as the front-runner for the Republican presidential nomination
less than a month out from the voting in Iowa, turns out there is still
time for Newt Gingrich to -- ka-ching.

Joining us now is Jonathan alter, MSNBC political analyst, "Bloomberg
View" columnist, and author of "The Promise: President Obama Year One."

Mr. Alter, it`s good to see you. Thanks for being here.

JONATHAN ALTER, MSNBC POLITICAL ANALYST: Hi, Rachel.

MADDOW: To your knowledge is there present for Mr. Gingrich`s
concurrent efforts to run for president and make a buck? Isn`t this
usually kind of a full-time job running for president?

Usually, this is what you do in spring training. So you had, for
instance, John McCain in 1999 when he was getting ready to run, he used his
book tour to launch. Other candidates have done that. Barack Obama did
some of that in 2007.

But this has never been done before. It`s very peculiar just a few
weeks before the Iowa caucuses. It reflects the -- I guess unquenchable
greed of Newt Gingrich. But it also has a chutzpah and hypocrisy element
to it.

You remember that Gingrich first became important in American politics
when he used a book deal that Speaker Jim Wright had to get Wright out as
speaker of the House. Then when Gingrich himself was speaker, it was a
book deal that involved a course that he was teaching that led him to be
fined $300,000 by the House Ethics Committee and pushed out as speaker of
the House by his fellow Republicans -- over a book.

So you would think that at this point he would, you know, sensing that
he might actually win the nomination, give it a rest.

MADDOW: I understand that technically it is illegal to run a campaign
for federal office that is also for personal profit -- running it in a way
that is designed to profit you or that ends up profiting you personally.
Aside from whether or not anybody ever looks into that, it doesn`t seem
like the FEC is the most aggressive enforcement agency in our federal
government right now.

ALTER: Right.

MADDOW: Does it hurt him politically, to be seen to be cashing in on
the campaign like this? This is not some fringe lefty critique of him.
This is a mainstream media story about how he`s running his campaign now.

ALTER: I don`t think it hurts him politically because the Republicans
have apparently decided that they like his anger, they like the fact that
he`s an authentic conservative -- not a fake one like Romney -- and they
don`t care about his past. So he`s using kind of an American amnesia.

He`s practiced in the art of amnesia, in giving people a sense that
all these things that the so-called liberal media is saying about him are
not important, that he`s thinking lofty thoughts about nanotechnology and,
you know, the future when young people -- poor kids can be janitors in
schools. And whatever other nutty futurism he has going, that Republicans
will care more about that and his record as a guy who expresses their anger
and they won`t care about all of this. They don`t even care about the
hypocrisy on Freddie Mac so far, the fact that he was saying that Barney
Frank should be in jail for his connections to Freddie Mac and Fannie Mae,
at the same time he had been on the payroll for $1.6 million.

These are new indoor records in hypocrisy, Rachel. But they don`t
seem to have much of an impact on Republican primary voters.

MADDOW: This close to the voting in Iowa, this rise of Newt Gingrich
right now is sort of turning out to be the first stress test for the Mitt
Romney campaign. How do you think the Mitt Romney campaign`s doing under
the pressure?

ALTER: You know, not so well. I guess they probably will take some
comfort in the fact that they`ve cut Gingrich`s lead in the national Gallup
poll. But they are I`m sure extremely nervous right now, because polls as
you indicated at the top of the broadcast, they are not important. They`re
not important. They`re not important.

And then suddenly they become really important because they are
snapshots about what`s going on at a particular moment. But when the --
you know, when the caucuses are just three weeks away, it`s pretty nerve-
racking for them. Because remember, Romney made a pivotal and perhaps
fatal decision to go back into Iowa recently. For a while he was going to
blow off Iowa and concentrate in New Hampshire. Now he`s put his chips
into Iowa.

So, if he gets beat badly there, then Gingrich has some momentum going
into New Hampshire and he could really lose this thing quickly because he`s
not going to do well in South Carolina. I think their goal will be to use
these debates to really take it to Gingrich as a hypocrite on thing like
Freddie Mac and see if they can get back into this game.

MADDOW: Jonathan Alter, MSNBC political analyst, the author of "The
Promise: President Obama Year One" -- Jonathan, it`s been too long since
we`ve had you here. Thanks for being on.

ALTER: Great to see you, Rachel.

MADDOW: All right. What Karl Rove and Arthur "The Fonz" Fonzarelli
suddenly have in common. Rove and Fonzi. Stay tuned.

(COMMERCIAL BREAK)

MADDOW: This is sort of a triumph of metaphor. The Republican Party,
the RNC, is holding its holiday party a week from today. Yes, that`s right
-- the RNC holiday party.

The folks at Politico.com got a hold of the invitation. As you can
see, the Republican Party has already surrendered in the war on Christmas.

But the beautiful metaphor here is that the Republican Party`s holiday
party is being hosted by the Chamber of Commerce. The biggest lobbyist for
corporations in the whole country is hosting the Republicans` holiday
party. That is a triumph of metaphor.

But I see your triumph of metaphor and raise it, these protesters
outside. As part of the week-long "Take Back the Capitol" protests, 99
percenter protesters showed up at the Chamber of Commerce building, which
was reportedly hosting its own holiday gala tonight, and this is how they
protested. They rolled out a red carpet for people arriving to the Chamber
of Commerce party.

As you can see, the carpet is sort of lumpy. That`s because
protesters are lying underneath it, thereby inviting corporate and business
lobby bigwigs to walk over the 99 percent bodily as they walk down the red
carpet.

The only more perfect metaphor in today`s politics would be if Rick
Perry did his anti-gay ad wearing the "Brokeback Mountain" jacket. Oh,
right.

The remarkable growth of the Occupy and Occupy style protest movement
was just named the number one U.S. news story of 2011 by "Time" magazine.
What`s happening in that number one news story right now is that the
movement is not just growing, it`s moving, and it is evolving.

Many of the cities that still have encampments are now having them
cleared out, including some of the largest ones left this week. The Occupy
New Orleans encampment was broken up by New Orleans police early Tuesday
morning, though a judge`s order later in the day allowed them to return
temporarily.

According to the "San Francisco Chronicle," there were 142 tents at
the Occupy San Francisco encampment when police came in to break that up
early Wednesday morning.

In Boston, Massachusetts, Occupy protesters are facing a midnight
deadline to decamp tonight. The Occupy Boston encampment has been set up
since the end of September. Protesters there say there are between 100 and
150 people living outdoors at that encampment.

There have been 99 percenter Occupy camps in cities large and small
all over the country, and in some places where they have cleared out, they
have sprung back up. So it`s not really possible on a day-to-day basis to
have a daily inventory of where the encampments still are. They move, they
spring up, they get evicted, they come back.

One of the last really large ones we know of is in Washington, D.C. I
was in Washington the last couple of days. And while everybody saw the
arrests this past weekend, what a wooden structure that they put at the
camp was taken down, dozens of protesters were arrested, you should know
that the Occupy D.C. encampment is still there. It`s big. It`s very close
to the White House

The "Washington Post" estimating that the D.C. site includes a range
of up to hundreds of protesters sleeping out. The encampment has been
there for about two months now. And it is big when you are there in
person.

Even as their public spaces are getting cleared out all over the
place, occupiers appear to be on the move. It`s a movement that does not
seem willing to be evicted, no matter what`s going on with the police or
mayor in that particular moment.

Occupy and Occupy-style protesters just aren`t going away. Listen to
what they were chanting here on their way to protest outside House Speaker
John Boehner`s office today.

(BEGIN VIDEO CLIP)

OCCUPY PROTESTERS: One, we`re unemployed. Two, we are united.
Three, you tell the speaker we`re not leaving. One, we`re unemployed.
Two, we are united. Three, you tell the speaker we`re not leaving.

(END VIDEO CLIP)

MADDOW: They are not leaving. Labor and faith groups also held a
large prayer vigil in Washington today, praying for Congress to pass a jobs
bill and to pass an extension of unemployment benefits. Occupy-style
protesters are showing up all over the place now, and in unexpected places.

They showed up at a Mitt Romney campaign event today in Iowa, an event
which was held at the come and go convenience store headquarters. Yes,
that`s a thing, don`t laugh.

And it was an event that featured guest speaker, New Jersey Governor
Chris Christie. As it turns out, despite his reputation for being awesome
with hecklers, Chris Christie is not always a man who deals well with
hecklers, or at least he wasn`t last night.

(BEGIN VIDEO CLIP)

GOV. CHRIS CHRISTIE (R), NEW JERSEY: While there are things that are
depressing right now about our situation in America, there is one thing
that is extraordinarily uplifting --

UNIDENTIFIED MALE: Mic check!

PROTESTERS: Mic check!

UNIDENTIFIED MALE: Chris Christie and Mitt Romney!

PROTESTERS: Chris Christie and Mitt Romney!

(YELLING)

CHRISTIE: Oh, yes.

(INAUDIBLE)

CHRISTIE: You know -- no, no, no. No. Hey.

(END VIDEO CLIP)

MADDOW: Hey. Yes. You can`t just shush them. They`re not there on
your terms, Governor.

Protesters also showed up at a Newt Gingrich fund-raiser. According
to Andy Kroll reporting for "Mother Jones" who was there and shot this
video, the protesters snuck in through an unlocked back door to interrupt
the event. Occupy Wall Street in New York is still going although it`s
become a set of loosely connected geographically dispersed action and
working groups since they got kicked out of Zuccotti Park by Mayor
Bloomberg.

But as long as we`re talking about perfect metaphors here, I should
also tell you that the company that owns Zuccotti Park, where this whole
movement got its physical space in which it started when the first
encampment went up and was ultimately taken down by police, the company
that owns Zuccotti Park, turns out that company owes $139,000 in back
taxes.

(COMMERCIAL BREAK)

MADDOW: On September 20th, 1977, at the start of the fifth season of
the show "Happy Days," there was an episode set not in Milwaukee but in Los
Angeles. In Los Angeles, Fonzie was challenged to prove his coolness slash
toughness by getting on water skis and jumping through the air over a
shark. Behold.

(VIDEO CLIP PLAYS)

MADDOW: More than 30 million people watched that episode. But in
retrospect, that turned out to be kind of the end for "Happy Days." I
mean, the shorts, the leather jacket, the shark. It was like the thing the
show had done really, really successfully had kind of run out of gas.

I love "Happy Days" still. But one of "Happy Days`" legacies has
turned out to be the phrase "jumping the shark" -- the point at which
something good or effective has stopped being good or effective.

Ladies and gentlemen, Karl Rove`s favorite political tactic has jumped
the shark. A shark in the form of Elizabeth Warren. That`s coming up.

(COMMERCIAL BREAK)

MADDOW: I still get surprised every time I look up at the TV and I
see Karl Rove on the FOX News Channel as an analyst. Ah, yes, an analyst.
He`s just an observer of what`s going on in American politics.

It`s like asking a race car driver live in the middle of the race if
he would please like to do a little play-by-play about how the race is
likely to turn out, about who`s ahead, about who`s racing well.

Dude is in the middle of the race. He cannot explain it. He`s in it.

But still, there`s Karl Rove, providing analysis of races that he is
participating in. Having newsmakers on TV shows, the people who are making
political news, is what all of us in TV do. Having the people on who are
making the news as if they are analysts of the news they are making, that
is something that`s just for FOX News.

If he weren`t still a partisan combatant, if Karl Rove weren`t still
running a lavishly funded, obviously partisan political operation that may
rival the size of the Republican presidential nominee`s actual campaign
next year, it would make sense to put him on TV analyzing Republican
politics. Mr. Rove is a pillar of modern Republican politics, not just for
the campaigns he has run, but for how he has run them.

Most famously, he all but patented the strategy of taking your
opponent`s greatest strength and using it against them. Don`t go after
them on their greatest weakness. Go after them on their greatest strength.

So, for example, knowing that America knew John Kerry as a senator
from Massachusetts and that Senator Kerry`s campaign would be trying to
reintroduce him to America as the Vietnam War hero that he was, Karl Rove
took John Kerry`s heroic war record, his Purple Hearts and his Bronze Star
and his Silver Star, and he made them bad somehow. Karl Rove used those
things against John Kerry as if John Kerry`s war record was somehow bad,
especially in comparison to the Vietnam War record of George W. Bush, who
never left Alabama, but he did get the outfit.

That`s the Karl Rove chapter in the big book of modern American
political tactics. However wrong or dishonest it is, it can work when you
get out ahead of the public, when you are out ahead, when you`re able to
define your opponent before they can define themselves. You can take their
best quality, and you can twist it to make it bad.

It`s sort of astonishing when you look back at it from a distance, but
when this Karl Rove tactic works, it really works. When it doesn`t work,
though, it really, really doesn`t work.

Take the Scott Brown versus Elizabeth Warren senate race that is
shaping up in Massachusetts. Karl Rove and his lavishly funded Crossroads
group have been running hundreds of thousands of dollars` worth of ads in
Massachusetts attacking Elizabeth Warren, attacking her before she`s even
secured her position as the Democratic nominee.

Now, as a popular incumbent, Senator Brown as recently as October was
polling five points ahead of Ms. Warren, the consumer advocate and Wall
Street critic. Karl Rove`s group then started running ads against
Elizabeth Warren, claiming she was just as horrible and left wing and
distasteful as those awful, awful Occupy Wall Street protesters.

Elizabeth Warren`s poll numbers shot up. The latest poll is showing
her seven points ahead of Scott Brown.

The new Karl Rove ad against Elizabeth Warren does a 180. Instead of
painting her as a wild-eyed, anti-Wall Street protester like they did last
time, now, Karl Rove`s newest ad says she`s Wall Street`s best friend.
Whatever sticks, I guess.

(BEGIN VIDEO CLIP)

NARRATOR: Congress at war and overseeing how your tax dollars were
spent, bailing out the same banks that helped cause the financial meltdown.
Bailouts that helped pay big bonuses to bank executives while middle-class
Americans lost out. Later, Warren went on a charm offensive with some of
the same banks who got bailed out.

(END VIDEO CLIP)

MADDOW: Seriously? Stock footage of a private jet? Really? That`s
how Karl Rove is trying to run the man described by "Forbes" as one of Wall
Street`s favorite congressmen, that`s how they`re trying to run him against
Elizabeth Warren, who invented a whole new agency to regulate Wall Street,
which Wall Street hates because it is supposed to help the middle class
against them.

I get why Karl Rove and his well-funded PAC want to be able to make
this argument. It is the strongest thing about Elizabeth Warren, so they
want to attack it. It is politically the worst thing about Scott Brown,
and so they want to smoke-screen that about him.

But the other thing that this ad means is that Occupy Wall Street is
winning the argument. America thinks Wall Street and the rich have too
much power and a politician on the side of Wall Street and the rich is not
someone who you should vote for.

At least judging by his latest advertising in the great state of
Massachusetts, Karl Rove thinks that Occupy Wall Street has won that
argument in America.

Let`s bring in the "Boston Globe`s" statehouse bureau chief, Frank
Phillips.

Mr. Phillips has been covering local and state politics in
Massachusetts for nearly 40 years.

Mr. Phillips, thank you very much for joining us tonight.

FRANK PHILLIPS, BOSTON GLOBE: It`s a pleasure, Rachel.

MADDOW: This Elizabeth Warren ad from the Karl Rove group saying
she`s a friend of Wall Street, it struck me as a little bit like putting
out an ad against Scott Brown saying he`s unattractive. It`s completely
contrary to the one thing a low-information voter might know about this
candidate even if they know nothing else, right?

PHILLIPS: Yes, it is. It is. And as you said, it`s what they did to
John Kerry. I think the difference is it was done in Ohio where John Kerry
was not known and he was able to shape his image there, Kerry`s image. And
I think Elizabeth, it`s going to be touch and go what he can do here. It
will do damage. No doubt about it.

But it is quite a pivot from what they were doing a month ago.
Suddenly, the Occupy Wall Street gang looks pretty good to Karl Rove.
Maybe he`ll be down there demonstrating with them before the end of this
campaign.

MADDOW: Is having a lot of big-mine ads from a Karl Rove-associated
group itself a political liability at all? Is there any resistance to the
idea that there ought to be big outside of Massachusetts money very early
on weighing in on this race?

PHILLIPS: Well, this is the first time we`ve seen Karl Rove in
Massachusetts. And I don`t know how it will play. It`s just early on.
This is extraordinary that 11 months out from the election we`ve already
spent -- seen $5 million worth of ads, most of them negative ads, up on the
air.

She, Elizabeth Warren has gone up with a million dollars of her own
ad. One on one, she`s looking into the camera, talking about her own
history.

But Brown himself has had $3 million worth of attack ads on him from
environmentalist groups. So, Rove`s now coming in with the second wave of
ads of about $600,000 each. The first one actually did do some damage.
Her negative rating tripled from 9 percent to 27 percent.

So, while she went ahead in the head on head race, she -- it did do
some damage. And I don`t doubt that this will have some negative effect.
People are still trying to figure out who Elizabeth Warren is. A lot of
people do know her in Massachusetts. And that`s to her advantage.

MADDOW: It is a great test of a campaign, especially with a first-
time candidate, to define the candidate in the mind of the voters, to get
out ahead of your opponent so you get your own story out there. There
hasn`t even been a Democratic primary in this race, but it does seem likely
that Elizabeth Warren`s going to be Senator Brown`s opponent.

After covering Massachusetts politics for as long as you have, how do
you assess her campaign, her level of support? How do you think she`s
doing so far?

PHILLIPS: Well, as you said, I`ve been doing this for almost 40
years. I have never seen a candidate come on so strong and excite the
political base of a party so quickly and raise so much money. People are
very excited about her candidacy in the Democratic Party.

And she`s actually going to -- the Democrats are in despair. Scott
Brown is an attractive candidate. He`s tried to show some independence as
a Republican.

And they really had no candidate to run against him. And she has
emerged and really has shown that this will be a very tight race, a highly
watched race nationally. It`s going to be a great debate.

It would be nice if some of these outside groups could stay out of it
and let them go at it. We don`t need all that sort of negative ads being
flung around, particularly this one, which really has -- stretches the
truth. It`s just not correct in a lot of what it`s saying.

MADDOW: Frank Phillips, "The Boston Globe`s" statehouse bureau chief
-- Mr. Phillips, thanks for joining us tonight. I feel lucky to have you
on the show. It`s nice to have you here.

PHILLIPS: Well, thank you for having me, Rachel.

MADDOW: Thanks.

All right. Right after the show, this is timely, on "THE LAST WORD,"
Lawrence O`Donnell`s guest will be Elizabeth Warren.

We`ll be right back.

(COMMERCIAL BREAK)

MADDOW: We`ve been reporting this year on the story of little Benton
Harbor, Michigan. Benton Harbor is very small, very poor, and rather
broken as a city. Benton Harbor was the first town in Michigan to feel the
tender caress of the state`s revamped emergency manager law.

Michigan passed a more limited emergency manager law under a
Democratic governor in the 1980s, but in March of this year, the new
Republican majority there created sort of an enhanced version, like
enhanced interrogation. Republican Governor Rick Snyder`s new version of
the law gives an emergency overseer complete control of any town that`s
been taken over.

An emergency overseer like the one in Benton Harbor can strip all
power from local elected officials. He can remove them from office. He
can abolish their offices altogether. He can cancel contracts. He can
even move to dissolve the whole town, just take it off the map, on one
man`s decision.

Benton Harbor was taken over by the state under the old law. In
April, under the enhanced version, their emergency manager issued an order
that said the outcome of Benton Harbor`s local elections was in effect
being overthrown, overruled.

What the people of that town voted for, null and void. The emergency
manager decreed that the elected town commission no longer had any power.
Based on his own ruling, he alone would be the government of Benton Harbor.

(BEGIN AUDIO CLIP)

JOSEPH HRRIS, BENTON HARBOR EMERGENCY MANAGER: The fact of the matter
is, the city manager is now gone. I am the city manager. I replaced the
finance director. So I`m the finance director and the city manager. I am
the mayor and the commission, and I don`t need them. You`re running the
city. You are the mayor. You are the commission.

(END AUDIO CLIP)

MADDOW: Now, Benton Harbor`s part of the story may almost be over.
That emergency manager says his time there is nearly done.

But Michigan`s Republican majority is just getting started. On
Friday, the state began a review of the finances of the city of Detroit, as
a possible precursor to installing an emergency manager there, too, to
putting Detroit under what its critics call financial martial law.

In Flint, Michigan, last week, the new emergency manager there
canceled all city council meetings and decided to stop paying the elected
mayor and city council. He made that decision unilaterally. He`s
basically overthrown the government there and overruled the results of the
last election. He has installed himself instead.

The city of Pontiac, Michigan, got its emergency manager in September.
He tells a local radio station that he is ready for that untrammeled
authority.

(BEGIN AUDIO CLIP)

SCHIMMEL: I don`t know, Frank, what you would do in a place like
Pontiac, Flint, Detroit, and so on, cities of that nature, if you didn`t
have a Public Act 4.

WJR-AM HOST: Well, it`s being portrayed as an act that takes the
election, the right to a ballot away from the people, that it takes power
it takes power away from elected officials and hands it over to a tyrant,
if you will, a dictator. How is that wrong? Where do people get it wrong?

SCHIMMEL: Well, I don`t know. I guess I`m the tyrant in Pontiac,
then, if that`s the way it is.

(END AUDIO CLIP)

MADDOW: I guess I`m the tyrant.

Pontiac`s emergency manager is at least from Pontiac. So at least
he`s the tyrant of his own hometown. He will now have unilateral authority
to destroy the town if he wants to, to dissolve it along with the results
of the last elections, when Pontiac voted for its own local officials.

You`ve got Flint and Pontiac newly under state control. You`ve got
the big city of Detroit now under review, as well as the tiny town of
Inkster, Michigan.

Chris Savage, who`s a Michigan Democratic activist, has been following
the emergency manager law on his site, Eclectablog. He posted a chart of
the places that either have an emergency manager already or could get one
soon.

Chris looked at the census data and he look at the towns on that list.
And you realized that when you put them together, you can tell that just
over half -- just over half of the African-Americans in the state of
Michigan are on the verge of having no meaningful local democracy.

Chris writes, quote, "Solving the problems does not start from the
baseline that the locally-elected, democratically-elected officials are not
a useful part of the process, to be shoved aside. Everything that happens
should begin at the baseline, that democracy is not just important, it`s
essential."

I still believe the story of Michigan`s emergency manager law, of what
is being done to democracy in the name of fixing Detroit and Flint and
Pontiac and Inkster and Benton Harbor, I still believe this could be the
most important and most under-covered story of the year. I know my
colleague, Ed Schultz, feels the same way.

It`s because along with the national story of Republican legislators
making it harder to vote in this country, Republican lawmakers in Michigan
have declared that your local vote could become mute if your town falls on
hard enough times.

Congressman John Conyers of Michigan, a Democrat, wrote to the Justice
Department last week and asked them to review and monitor the Republicans`
emergency overthrow the towns march through Michigan. Mr. Conyers writing,
quote, "While the law itself may be facially mutual, it`s being applied in
a discriminatory fashion."

Congressman Conyers says the Justice Department has told him it is
reviewing the law.

There`s also a recall drive to put the law up for citizens repeal in
Michigan. It looks like they might get the signatures they need this
month.

Republican Governor Rick Snyder is considering a contingency plan,
asking the legislator to pass the sort of emergency manager law 3.0, so he
can keep taking over towns any way even if his last law was recalled.

For now, the question in Michigan is: who gets to have a local
democracy? Who is being allowed to be worthy of being allowed to elect
their own officials? And why it`s taking democracy away considered a
prerequisite for fixing a place?

Should your vote matter even if the state doesn`t like the decisions
of the people you elect? Should your vote count?

This chart should rattle anyone who cares about that.

The emergency manager law has been a signature policy of Governor Rick
Snyder`s administration, the one that he was willing to risk giant
Wisconsin-style protests over.

A new poll out this weeks shows support for Governor Rick Snyder has
fallen by more than half since he was elected last year. It`s down by half
even within his own Republican Party. You can`t say that what is sinking
Rick Snyder`s popularity is his emergency manager law, just as you can say
Michigan Republicans passed this law so they can take democracy away for
more than half the African-Americans in the state of Michigan. But you
can`t say that Michigan Republicans are on their way to doing that whether
they mean to or not.

(COMMERCIAL BREAK)

MADDOW: Meanwhile, in the rest of the world, something that happens
in Russia keeps happening in Russia, protests. A fifth straight day of
protests after an election this past weekend that does not seem to have
passed the smell test for many Russian people.

Authorities arresting the protesters seem to have inspired more people
to protest, which is kind of the way these things work all around the
world.

Current prime minister/former president, Vladimir Putin, has been at
the helm of the Russian government for more than a decade. This is the
first time that they have turned out in big numbers in the streets to
protest against him.

While the toppling of dictators we have seen this year around the
world, governments who have tightly held their grip on power for many years
and are wary of mass demonstrations. Like this one planned in Moscow for
this Saturday. According to the Facebook page, 32,000 people say that they
are going to this thing.

In the face of these very rare protests, Prime Minister Putin took to
Russian TV today to tell the world that he knows why this is happening, he
knows why Russians are turning out in the streets against him. He said
essentially that it`s all her fault. "Her" being U.S. Secretary of State
Hillary Clinton, who`s having quite a week, thank you very much.

President Putin said Hillary Clinton`s expressed concerns on behalf of
the U.S. government this wee about the integrity of the Russian election
sent a, quote, "signal to some actors inside Russia."

Among the incendiary things Secretary Clinton said about those Russian
elections, quote, "The Russian people, like people everywhere, deserve the
right to have their voices heard and their votes counted." Oh, snap.

The risk the U.S. takes whenever any American government official says
anything about almost anything going on in other parts of the world is that
the U.S. will then be blamed by that country`s leaders for what happens in
that country next. That is the risk. You see that happening in Russia now
with Putin blaming the United States for the protests. That`s the risks.

But here`s the reason the risk is sometimes worth it. The nation of
Malawi in Southeastern African now says that it is reconsidering its
national law that makes being gay a crime. Malawi`s minister of justice
says they`re doing this because of, quote, "public opinion."

This news comes just two days after Secretary of State Hillary
Clinton`s historic speech, asserting that gay rights everywhere in the
world are human rights, saying in that speech that the United States would
work to end the repression of sexual minorities around the world and that
leadership by foreign leaders around the globe should include leading their
own people on the issue of gay rights. The speech supported a new policy
memorandum from President Obama asserting that the U.S. would pay attention
to country`s treatment of their gay citizens when we hand out foreign aid.

Last fiscal year, the United States gave Malawi $140 million in
development money and another $100 million on food and other humanitarian
aid there.

And last year, Malawi sentenced a gay couple to 14 years in prison for
the crime of holding an engagement ceremony. After an international outcry
against that sentence, Malawi`s president pardoned the couple. And now,
Malawi says they are reconsidering their overall national criminalization
of homosexuality. That`s a change.

That does it for us tonight. We`ll see you again tomorrow night.

Now, it`s time for "THE LAST WORD" with Lawrence O`Donnell including
his exclusive interview with Elizabeth Warren. Please stay tuned.

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

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