updated 12/29/2011 11:52:19 AM ET 2011-12-29T16:52:19

Guests: Roger Simon, Bob Shrum, Ari Melber, Wendell Potter, Caroline Heldman, Katie O`Connor

ED SCHULTZ, HOST: Good evening, Americans. And welcome to THE ED
SHOW tonight live from Minneapolis.

Iowa Republicans have less than a week to decide who will battle
President Obama in the 2012 election.

Let`s look at it. Rick Perry has spent millions of dollars. Rick
Santorum has been to 99 counties across the state. Michele Bachmann is
from Iowa. But Ron Paul is the leader in the clubhouse.

So I went to Iowa today to see why. I`ll have my commentary and
coverage coming up.

This is THE ED SHOW -- let`s get to work.

(BEGIN VIDEOTAPE)

SCHULTZ: What do you like about them?

UNIDENTIFIED MALE: About Ron Paul?

SCHULTZ: Yes.

UNIDENTIFIED MALE: What is there not to like about him?

SCHULTZ (voice-over): With the first vote just six days away, I stop
by a Ron Paul event in Newton, Iowa, today, to talk to supporters.

NARRATOR: Are you unhappy with the current GOP field? Let me tell
you something. You are not alone.

SCHULTZ: And the "anybody but Mitt" crowd continues with a new radio
ad calling for Sarah Palin to jump into the presidential race. Democratic
strategist Bob Shrum handicaps Iowa and beyond.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Our plan was right for our
state, and in my view, it was based upon conservative principles.

SCHULTZ: Mitt Romney is touting the individual mandate as a
conservative principle, but still wants to repeal Obamacare. Tonight,
we`ll highlight the Republican hypocrisy.

The Republican effort to strip voting rights continues. And the
Justice Department is taking action. The ACLU`s Katie O`Connor, and
professor at Occidental College, Caroline Heldman will talk about further
action and have the latest on the GOP voter obstruction.

(END VIDEOTAPE)

SCHULTZ: Good to have you with us tonight, folks. Thanks for
watching.

The story was in Newton, Iowa, today. I was there. It was the same
old stuff.

Let`s see -- freedom, the Constitution, limited government, protect
liberty, repeal regulations, all pretty simple stuff and straightforward --
kind of like Iowa.

A crowd of about 150 people showed up today. Let me tell you, they
were staunch Ron Paul supporters.

(BEGIN VIDEO CLIP)

SCHULTZ: Through the polling that`s out there, very favorable to Ron
Paul right now down the stretch. What does it feel like on the ground?

DREW IVERS, PAUL CAMPAIGN IOWA CHAIR: I`ve been involved in a number
of campaigns and I can tell you from this one here, there`s a -- it`s
positive and it`s growing. Now, is it growing by leaps and bounds? I
would say no. It`s a pretty consistent, steady growth that we`ve
experienced throughout the whole campaign.

SCHULTZ: What`s the attraction?

IVERS: I think the attraction, the young people probably reflect it
best, and that is they see an honest, humble statesman talking about the
future, their future, not just the election, presenting realistic comments
and questions about the problems and solutions. And I think people are
saying, you know, this guy is honest and he is saying the right things and
he has been for a long time.

And the credibility of the messenger has to match the credibility of
the message. And Ron Paul`s got them both together.

(END VIDEO CLIP)

SCHULTZ: That straight talk Ivers is talking about was rolled out in
a new television campaign ad today titled "The One We`ve Been Looking For."

(BEGIN VIDEO CLIPS)

NARRATOR: The Washington machine is strangling our economy.
Politicians who supported bailouts and mandates, serial hypocrites and
flip-floppers can`t clean up the mess. One man stands alone, a real plan
to cut $1 trillion year one. Balance the budget in three.

Consistent, incorruptible, guided by faith and principle. Ron Paul --
the one we`ve been looking for.

SCHULTZ: What do you like about him?

UNIDENTIFIED MALE: About Ron Paul?

SCHULTZ: Yes.

UNIDENTIFIED MALE: What is there not to like about him? Former
military, I came from Indiana. I was raised on principles and morals. And
go back five, 10, 20, 30 years, Ron Paul has had the same, consistent
message, something none of the other candidates can even fake.

Message on principles, morals, our personal rights, our personal
liberties, restricted government that keeps out of our pockets, out of our
lives. Something the government was never meant to do. Our Founding
Fathers were very specific about that.

SCHULTZ: How old are you?

UNIDENTIFIED MALE: Twenty-three.

SCHULTZ: What do your friends say?

UNIDENTIFIED MALE: Most of them, I don`t have friends many my age
because most of them I`m kind of distant because I`m in politics, I`m a
little above the age level. Most the kids my age are worried about
college, worried about what club to go to tomorrow night, not about their
future.

SCHULTZ: But Ron Paul speaks to you.

UNIDENTIFIED MALE: Yes.

SCHULTZ: You got up and said he`s the only one.

UNIDENTIFIED MALE: Yes, sir, absolutely.

SCHULTZ: What`s the attraction?

UNIDENTIFIED MALE: Because he follows the Constitution. That, for
me, that`s it. All the other people want to -- he follows the
Constitution, Ed. Good, bad or different as you want to explain that, when
I was in, I swore to defend the Constitution, from all enemies foreign and
domestic. As far as I`m concerned, half the politicians we have now should
be -- I`m for freedom. They haven`t followed the Constitution.

SCHULTZ: Will he win Iowa?

UNIDENTIFIED MALE: Yes, sir.

SCHULTZ: You think Ron Paul will win the caucus?

UNIDENTIFIED MALE: Yes, sir.

SCHULTZ: And beyond that, what does a victory in Iowa do for him, you
think?

UNIDENTIFIED MALE: Well, you know what, that`s a hard one. I don`t
think --

SCHULTZ: I mean, how do you feel about the establishment being
against him? I mean, the Republican establishment --

UNIDENTIFIED MALE: Screw them. I`m sorry. Screw them.

They gave us McCain. Republican establishment gave us McCain in 2008.
What did it get us? Nothing.

(END VIDEO CLIPS)

SCHULTZ: The latest polling in Iowa shows Ron Paul with a four-point
lead over Mitt Romney, 24 percent to 20 percent. Paul seems to be holding
his lead and with the front-runner status comes all the media attention.
There was more media today there than he`s ever seen on the campaign trail
so far.

I caught up with "Politico`s" Roger Simon.

(BEGIN VIDEOTAPE)

SCHULTZ: Roger, what`s happening here? What`s happening on the
ground? How do you see this unfolding in the final week?

ROGER SIMON, POLITICO: All a bit of confusion. All the campaigns I
talked to are a bit worried because they`re calling their supporters in
these last few days, identifying their most devoted supporters and making
sure they come out to the caucuses on Tuesday. But what they`re finding is
very soft support.

People are saying, yes, I like Romney, yes, I like Paul, yes, I like
Gingrich, but I really haven`t seen the other guy yet. And so, you know,
don`t count on me. And that`s worrying them.

SCHULTZ: So, this undecided number is a real deal.

SIMON: Yes. I think it is a real deal. And it may suppress turnout.

The general rule of thumb is the lower the turnout, the better that
organization counts, and Ron Paul, it is said, has the best organization.
So a low turnout could hurt a Ron Paul campaign. High turnout probably --
I`m sorry -- a low turnout would help a Ron Paul campaign, high turnout
would probably help a Romney or Gingrich campaign.

SCHULTZ: Is Romney the guy to beat from Ron Paul`s perspective at
this point?

SIMON: I think he is, although his ads are attacking everybody. But
there are three elements here. There`s passion, there`s organization, and
there`s electability.

Ron Paul probably has two of those three. Passionate supporters, good
organization, but very few people probably can see him behind that desk in
the Oval Office.

With Mitt Romney, on the other hand, has that electability thing going
for him. You can actually envision him. His organization is probably
pretty good. He lacks passion.

Newt probably has some passion, lacking in the others. So, it`s --
you`re struggling to get at least two out of the three if you can.

SCHULTZ: Yes. You know, you talk about organization. Last night at
a basketball game --

SIMON: Yes.

SCHULTZ: -- in small town Iowa, look at this folder that the Ron Paul
people put out. I mean, that`s quite a commitment.

SIMON: Yes.

SCHULTZ: This is -- I mean, his position on national fence,
immigration, war in the Middle East, health care, jobs, taxes. I mean,
this pretty much spells it out.

From what you`ve seen, is anybody else doing this stuff?

SIMON: They all have literature. But this is a good piece of
literature. Though oddly enough, Iowans read this stuff.

SCHULTZ: Yes.

SIMON: When you go knocking on doors, volunteers go out, somebody`s
going to ask you what`s your position on immigration, what`s your position
on taxes, what`s your position on hog lots which is big in the state?

The volunteer is expected to know or have a piece of literature to
hand them and say, it`s all in here, ma`am, it`s all in here, sir. Read
this -- he`ll know where Ron Paul stands. That`s helpful.

SCHULTZ: Very good.

(END VIDEOTAPE)

SCHULTZ: Here it is. This is the ground game that we have been
talking about with Ron Paul, and it`s true that everybody out there that`s
running for president in Iowa does have material. But not like this, and
not the kind of ground game.

I mean, to go out to basketball games and public events and put this
kind of material out there for people to read, I think is pretty, pretty
amazing. It`s pretty organized. I mean, if you look at what Ron Paul is
telling the people of Iowa, if he is president of the United States, he`s
going to get rid of the IRS. He`s going to end the income tax. He`s going
to bring our troops home. He`s going to end foreign wars, end the Fed,
stop foreign aid, secure the borders, fix health care, repeal the Patriot
Act.

He was big on that today in Newton, Iowa, talking about how we have to
get rid of the Patriot Act. It violates the Fourth Amendment. He would
return power to the states, that`s raw meat to the Tea Partiers, the Ninth
and Tenth Amendment. Balance the budget if he could do that.

Abolish corporate subsidies. Goodbye farmers in Iowa, you`re not
going to be getting any help from this guy.

And, of course, return spending to the 2006 levels.

Now, this kind of stuff works in a state of older demographics because
as Roger Simons says, hey, people read this stuff. They do read it.

This has had a big impact. Since they`ve been putting this kind of
stuff out, this is when Ron Paul has been moving up in the polls. It`s the
direct mail tactic that is an old conservative thing that was put together
way back when, 30, 40 years ago by Richard Viguerie and the old
conservatives. This is how Ron Paul`s ground game is getting people into
the fold.

The question is: is he going to be able to turn people out? And he`s
already picking and choosing his media. The candidate has stopped doing
national interviews, maybe it has something to do with the ordeal he had
the other day with CNN. They talk only to local voters and local Iowa
media.

Ron Paul did a job today, did a good job today of giving the cold
shoulder to the national media when they were hounding him. But he did
respond to my question when I got in close to him about infrastructure.

(BEGIN VIDEO CLIP)

SCHULTZ: Get somebody to stand up and talk. Do you feel like you
have that infrastructure?

REP. RON PAUL (R-TX), PRESIDENTIAL CANDIDATE: I don`t have that
information.

SCHULTZ: I mean, like, people would go into a caucus room and they
would stand up and make a pitch for the candidate. All of these places
around the state, do you feel comfortable you got a spokesman in each one
of these places?

PAUL: I don`t have that information to answer it.

(END VIDEO CLIP)

SCHULTZ: He doesn`t have that information. I mean, I find that
surprising. It`s all about organization in Iowa. Ron Paul could not
confirm to me that he will have 1,774 people ready to step up and speak out
at caucus night.

Now, he`s actually not going to need that many. He`s going to need
about a thousand, because that`s how many caucus sites they`ve condensed it
down to.

But this is how it works in Iowa. What`s going to happen, there`s
going to be a small town, people are going to caucus at a given location.
There may be 50, 100, 200 people show up.

And then each candidate has got to have a surrogate -- a selected
surrogate from that area to step up and give a pitch about any candidate
that they support. And if you`ve got a high number of people who are
undecided, all of a sudden, well, there`s Susie Brown sitting over there,
she runs the hardware store, and there`s farmer Johnson down the road. He
just got off his tractor and came in this evening to find out what`s going
on, and he`s undecided, too.

All of a sudden, they start milling in groups. Somebody makes a
strong pitch and they say, oh, yes, I think I`m going to go with that guy.

And so, this is the ground game that I think maybe Rick Santorum has.
This is the ground game that I think maybe Michele Bachmann has. And this
is the wildcard in all of this.

And, of course, both Romney and Gingrich are attacking the front-
runner, Ron Paul, on past controversial social positions.

The staunch Ron Paul supporters think fellow Iowans will see through
all of this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Iowans are very politically savvy and they`ll see
through that. I mean, we hear the message and see the message that comes
from him. It`s very -- he`s a simple man and he says it in a simple
planned way. And I think we see through that.

SCHULTZ: So the straight talk will overcome any controversy?

UNIDENTIFIED MALE: Yes, sir. I was telling somebody else, Michele
Bachmann this morning said that Ron Paul wouldn`t defend our country if it
were attacked. That`s a bunch of hooey.

(END VIDEO CLIP)

SCHULTZ: Well, the Paul campaign admitted to me this afternoon, one
of their officials, that Rick Santorum is having a surge. They don`t know
what to make of it.

I`ll visit with the candidate, Rick Santorum, tomorrow. And, of
course, they think that the public in Iowa has figured out what 84 ethics
violations by the former speaker of the House is all about. Some campaign
workers told me that they think that Newt Gingrich is history.

Late word this afternoon, Gingrich will spend a half a million dollars
the rest of this week going up to the Iowa caucus, trying to fix his poll
numbers in the state.

But watching the crowd today in Newton, Iowa, there`s nothing rah-rah
about Ron Paul. He almost has a fatalistic type of message. If we don`t
do this, this is what`s going to happen to America. There`s no talk about
hope or change. There`s talk about change, but it is if we don`t do this,
we`re going to explode as a country.

The crowd, it`s like a -- it`s like a college professor and he is 76
years old, a grand old statesman, standing up, not looking or giving the
big line to the people to get a bunch of rah-rah going. They`re very
intent. It`s like it`s a college classroom and he`s explaining to them
what`s wrong with the country, why he should be president and where we have
to go as a nation.

And the people who are there following Ron Paul -- I mean, they are
staunch believers. I mean, they would -- they would try to do -- they`d
run through fire for this guy. And they sit there and they consume this
stuff and they believe in what he is all about. If they turn out to vote
on caucus night, Ron Paul could win big-time.

It`s all about the turnout. They think that the young vote, and they
also think the independent vote, will go to their camp.

Get your cell phones out. I want to know what you think. Tonight`s
question: Who will win the Iowa caucus on Tuesday?

Give you three choices tonight. Mitt Romney, text "A" for Mitt
Romney. Text "B" for Ron Paul. Text "C" for Rick Santorum to 622639. You
can go to my blog at Ed.MSNBC.com. We`ll bring you the results later on on
the show.

New polls are showing some last minute surprises in Iowa. Bob Shrum
will join me next to break down the strategies as we head into the
caucuses.

Mitt Romney says health care mandates are a good, conservative
principle, but only if he does it. Not if Barack Obama does it.

Stay with us. We`re right back on THE ED SHOW.

(COMMERCIAL BREAK)

SCHULTZ: Coming up: a rogue element in Iowa is urging people to
caucus for Sarah P? More Iowa headlines with Bob Shrum coming up.

Rick Perry spent $6 million in Iowa. He may want to spend a few bucks
on a map of the United States. Wait until you hear his latest gaffe. It`s
a dandy.

Justice Department threw out a voter ID law in South Carolina last
week. Now, Republicans are claiming it`s the Obama administration that`s
playing politics.

And you can tweet us your thoughts during the show, throughout the
program using #EdShow.

We`re right back. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Well, the picture today in Iowa is no clearer today than it
was yesterday. A new CNN/"Time" poll puts Mitt Romney back in the lead.
But Ron Paul is within the margin on error. Newt Gingrich has tumbled to
fourth place. Rick Santorum jumped to third with 16 percent.

Public Policy Polling has Ron Paul on top and Mitt Romney second.

Four other candidates are in a dead heat for third place, all within
the poll`s margin of error.

Romney added to his upward momentum, getting another newspaper
endorsement today. This one from the Iowa "Press Citizen."

Meanwhile, Rick Santorum is telling Iowa voters to pick him as the
clear conservative choice in the field.

(BEGIN VIDEO CLIP)

RICK SANTORUM (R), PRESIDENTIAL CANDIDATE: How much trust do you
have? (INAUDIBLE). It`s not popular being conservative. Those values are
deeply rooted and that person will stand by. Well, here you have someone
that you can trust because I`ve done it.

(END VIDEO CLIP)

SCHULTZ: Some Republicans in Iowa are still not satisfied with any of
the options the party is offering. An independent political group is
running a radio ad in Iowa to urge caucusgoers to write in someone else.

(BEGIN VIDEO CLIP)

NARRATOR: Are you unhappy with the current GOP field? Let me tell
you something. You are not alone.

Join thousands of Iowans as we vote rogue. It`s the caucus for Sarah
Palin on January 3rd. Let Iowa and the entire country know we want real
leadership and real reform in D.C.

(END VIDEO CLIP)

SCHULTZ: With six days to go, the Iowa vote is still up for grabs.
And there will probably be more surprises in the coming days.

Let`s turn to Bob Shrum. He`s been down this road before. Democratic
strategist and professor at New York University.

Bob, great to have you with us tonight.

BOB SHRUM, DEMOCRATIC STRATEGIST: Great to be here.

SCHULTZ: Which candidate -- you bet. Which candidate as it stands
right now has the momentum in Iowa? How do you call it?

SHRUM: I think two candidates have the momentum. I think Romney has
momentum. It`s pretty clear from the polls. He`s got a ceiling, but he
keeps adding inch by inch to his total.

There`s apparently going to be very good weather on Monday night.
That`s going to help him. The somewhat less committed people tend to favor
him. He`s efficiently pursued a kind of cold mechanistic strategy where he
leans as far to the right as he has to, to try to satisfy the social
conservatives.

So, if you had to bet on someone, you`d bet on him.

The other person who has momentum right now in my view is Rick
Santorum. And that`s because conservatives, the religious right, who`ve
gone shopping for a non-Romney over and over and over are finally down to
one guy. And that`s Santorum.

He`s sitting there, at least in that CNN poll, at 16 percent. He
could finish second. I think it would be hard for him to finish first.
But I think he could finish second.

SCHULTZ: This is Rick Santorum on CNN talking about his caucus
strategy. Here it is.

(BEGIN VIDEO CLIP)

SANTORUMN: We have a thousand caucus captains. Some cases we have
four, five, six people at a caucus that are going to be caucus captains for
us. And you can go into a caucus and give a three to five-minute speech
for your candidate. You can wear the badge. You can go and talk to people
and, you know, gently twist little arms.

We`ve seen from a lot of the polls a large number of people are still,
you know, moving around, as you`ve seen from all these polls. There`s a
lot of movement.

(END VIDEO CLIP)

SCHULTZ: You know, this plays into the undecided people that are
going to be showing up. Are these voters swayed by caucus captains, Bob?
What do you think?

SHRUM: I think pretty much by the time they go into the caucus they
know what they`re going to vote for. We`ve been talking about these polls.
We`re gong to wait and see what the "Des Moines Register" poll which has a
remarkable track record for accuracy says when it comes out this weekend.

I mean, one of two things is going to happen here. Either Romney is
going to win this thing, win New Hampshire, do OK in South Carolina, win
Florida, wrap this up early -- or he`s going to stumble a little bit. I
think in the end he still wins the nomination, because the Republican
establishment cannot abide the idea of Ron Paul. And I don`t think Rick
Santorum has the plausibility or money to challenge Romney over the long
term.

It would be a fun battle, though, because it would be the battle of
two stiffs. It would be interesting to see them on stage with each other.

SCHULTZ: Well, let`s say Santorum comes in second place. You know,
he gathers the social conservatives, he`s asking conservatives to unite.
Let`s say he finishes second in Iowa. Let`s say either Paul or Romney win
it.

Does Santorum skip New Hampshire and go right to South Carolina? He
doesn`t have much going for him in New Hampshire.

Take a look at this latest CNN/"Time" poll. Mitt Romney has a
commanding lead of 44 percent. If anyone but Mitt Romney wins Iowa, do you
think they win, should they skip New Hampshire and just go straight to
South Carolina? What do you think?

SHRUM: You know, that`s an interesting strategy because the fact is,
unless Romney finishes third, by the way -- if he finishes third, that`s
going to create waves in New Hampshire and may open some room for Huntsman.
Then, you`d want those other conservatives there and Gingrich will surely
be there. He has the support of the Manchester "Union Leader," the state`s
biggest newspaper. Then there`d be an opening.

But I think if Romney is second or first, and if the alternatives are
Paul or Santorum, maybe Santorum, especially, ought to just go to South
Carolina. There are folks in New Hampshire for whom Paul might have an
appeal. I don`t think Santorum has much of anything going in New
Hampshire.

SCHULTZ: Bob Shrum, great to have you with us tonight. Thanks so
much.

SHRUM: Thanks, Ed. Thank you.

SCHULTZ: A Republican -- you bet. A Republican wildcard could win
the Iowa caucus. I`ll show you how Rick Perry still isn`t playing with a
full deck. That`s next.

Mitt Romney is running for president as an expert on business. Now,
someone from his past is coming forward to ask whether Romney`s business
leadership is good for the country. You won`t want to miss it.

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Our team was on the ground in Iowa at a Ron Paul event
today.

And here`s what people are telling me -- the rise of a Republican
wildcard candidate is very real. Rick Santorum is surging. Michele
Bachmann is getting a second look.

And Rick Perry has the ground game to gather votes from the cultural
social conservatives. He has spent a ton of money on television ads in
Iowa. In fact, every time you turn on the TV, there he is again, Rick
Perry. He is throwing millions into this and he`s focusing on the social
issues.

He told one group that watching a DVD led to his transformation on
abortion. And while he`s no longer selling himself as the so-called jobs
candidate, Perry did talk energy independence with an Iowa crowd yesterday.

And here`s the quote that gets us. "Every barrel of oil that comes
out of those sands in Canada is a barrel of oil that we don`t have to buy
from a foreign source."

Now, that doesn`t mean that if Rick Perry somehow becomes president
that we`re going to be invading Canada, does it? No. Republicans don`t
invade anybody. We`re safe.

But you Canadians, you got to feel pretty close to us tonight after
that, huh? Well, you know what? I`m going to miss Rick Perry because of
comments like that. I would have really looked forward to him going up
against President Obama. But it isn`t going to happen.

A preview of how Mitt Romney will twist himself in knots if he is the
Republican nominee against Barack Obama. That is next.

And the Justice Department calls a new voter I.D. law discriminatory.
What will it mean for the 2012 elections? Stay tuned. We`re right back.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW. Thanks for watching tonight.
This is a dandy. Today, Mitt Romney gave another preview of how he will
twist himself into knots if he is the Republican nominee to go against
President Obama. He insists -- insists the health care mandates are a
conservative principle, but only at the state level -- the state level.

OK, so here`s what he said on Fox News this morning.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Look, our plan was rights
for our state. And in my view, it was based upon conservative principles
that, frankly, came from Newt Gingrich and the Heritage Foundation, which
was instead of people relying on government to provide their care, they
should take personal responsibility.

And it is fundamentally a conservative principle to insist that people
take personal responsibility, as opposed to turning to government for
giving out free care.

(END VIDEO CLIP)

SCHULTZ: But Romney promises again and again to repeal the Affordable
Care Act if he becomes president of the United States. Apparently the
conservative principle of the health care mandate doesn`t apply at the
federal level. Now we can give him credit for one thing. That is he has
been consistent in talking about what a great idea mandates are.

(BEGIN VIDEO CLIP)

ROMNEY: No more free riders. People have to take personal
responsibility. I consider it a conservative plan.

TIM RUSSERT, FORMER "MEET THE PRESS" MODERATOR: So if a state chose a
mandate, it wouldn`t bother you?

ROMNEY: I think it`s a terrific idea. After all these states, that
are the laboratories of democracy, get their chance to try their own plans,
that those who follow the path that we pursued will find it`s the best
path. We`ll end up with a nation that`s taken a mandate approach.

(END VIDEO CLIP)

SCHULTZ: Think about that for a minute. He says we insist they buy
it. A mandate is when we, the government, insist people buy health
insurance. But for Romney, it`s only a good conservative principle if a
state government imposes it. Not the federal government.

I`m joined tonight by Wendell Potter, senior analyst at the Center for
Public Integrity, and Ari Melber of "The Nation" magazine. Gentlemen, good
to have you with us tonight.

Ari, how can he make this case? It`s OK at the state level, not good
at a federal level? How is he going to work himself through this?

ARI MELBER, "THE NATION": I don`t think he gets very far. I think
problem here, as you have illustrated, is that it doesn`t add up. If it`s
a good idea, if it`s a matter of personal responsibility, as he said -- I
do agree with him the way he puts it. Because it is true that, one way or
another, society does have to deal with the problems associated with health
care and lack of health care, which is why I think having a mandate at the
federal level that President Obama pushed so hard for is a good thing.

But if that`s true, then it`s true at whatever level you operate it
at. That`s why Romney doesn`t sound very convincing here.

SCHULTZ: Wendell, if mandates accomplish anything at all, why would
it be good at the state level and not at the federal level? How do you see
this?

WENDELL POTTER, CTR. FOR PUBLIC INTEGRITY: Well, that dog just won`t
hunt because Republicans have tried this at the federal level in years
past. It was, indeed, birthed by the Heritage Foundation. And it was a
big part of a Republican piece of legislation in 1993, the Consumer Choice
Health Security Act, which was sponsored by Senator Don Nichols, one of the
Republican leaders. And it had 24 Republican co-sponsors.

So back then, it was a great idea for the federal government to be
involved in instituting a federal mandate. So it`s always been something
that Republicans have felt was important for and appropriate for the entire
country.

SCHULTZ: Well, I tell you what, for him to pass it off, Ari, as a
conservative principle is really a reach. The other funny thing about
Romney saying mandates are a personal responsibility, it only works if the
government imposes it.

Ari, how is this going to play with the Tea Partiers? They hate the
idea of the government getting involved in anything. What do you think?

MELBER: Yes, they don`t like it. We all remember the sad moment at
the debate where people cheered in response to the libertarian idea that
you have to just let folks who are sick die, that there`s no protection for
them. I don`t think the issue is going away because, as you said, the Tea
Party is very, very concerned about this.

We have, of course, the Supreme Court which will ultimately rule on
this. I just find the whole thing a little ridiculous, because the
government obviously has the power to make rules that require you to do
things. You have laws that require you to buy clothes and wear them in
public. You have laws that require you to pay into Social Security, which
is a form of insurance and helps with disabilities as well. You have laws
about driver`s licenses.

I don`t think the Tea Party or the Ron Paul libertarian crowd, for all
of their energy -- they have great energy, as you reported from Iowa. But
I don`t think they get very far on the jurisprudence or the policy
argument, that the government cannot or should not take a role in
regulating a market which, by the way, is still predominantly private
insurance carriers.

SCHULTZ: Of course, Mitt Romney loves to throw out the Heritage
Foundation and, of course, Newt Gingrich. Newt Gingrich has changed his
position. He used to passionately defend mandates, but no more. Listen to
this.

(BEGIN VIDEO CLIP)

NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: The difference between
Romney and me is we both used to have the wrong idea. I`m willing to say
it was the wrong idea. He`s not.

I think it`s funny that they want to attack me for admitting that I
was wrong, but they won`t admit that he`s now wring -- thinks he`s still
right when he`s wrong.

(END VIDEO CLIP)

SCHULTZ: Wendell, where should people in this country be on this
issue in your opinion, if we`re going to have a better country when it
comes to health care delivery? Is a mandate something that is going to be
better for the country?

POTTER: Oh, absolutely. It is better for the country because we need
to bring everybody into coverage. There are people who simply have chosen
not to get coverage when they possibly could afford it. They are, indeed,
free loaders, as they have been called -- or free riders, by Newt Gingrich
in the past.

We need to bring everybody into coverage. The other thing, though, is
that many people who are uninsured are that way not by choice but because
they can`t get coverage at any price from insurance companies. They won`t
sell it to them.

So we need to have this. We need to have everybody in coverage. The
only way to do this with the legislation we have, which has been
legislation that`s been modeled after conservative legislation in the past,
is an individual mandate. It`s very important.

SCHULTZ: Yeah. Well, it would seem to me that Mitt Romney would be
in favor of universal health care if he`s for the mandate, because that
does open the door to something much broader, that all the industrial
nations in this world have except the United States. I hope we do go down
that path.

Wendell Potter, Ari Melber, thanks for your time tonight. Appreciate
it.

Mitt Romney is smiling in this photo. Next, you`ll hear from a man
who was caused nothing but pain while Mitt Romney and his buddies got real
wealthy. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: This just in. A few moments ago, we were told that the
situation on the ground in Iowa is more than fluid. This literally just
came in from our reporter with the Ron Paul campaign. Michele Bachmann`s
state co-chair, Kent Sorensen (ph), just appeared at a Ron Paul event in
Iowa and endorsed the Texas congressman.

Stay tuned, folks. While there are only six days left, but the ground
is clearly shifting. So the co-chair of the Bachmann campaign has jumped
ship and gone over to Ron Paul.

Up next, Romney made millions of dollars at Bain Capital by putting my
next guest and his co-workers at AMPAD on the unemployment line.

Don`t forget to Tweet us using the hash tag #EdShow. Stay tuned.
We`re right back.

(COMMERCIAL BREAK)

SCHULTZ: Well, the 2012 election is going to be about the economy and
jobs. I think we can agree on that. Most polls show that across the
country. Mitt Romney`s history at Bain Capital is not going to help his
image as a job creator.

Now, we want to disclose that NBC Universal and Bain Capital are each
a part owner of the Weather Channel. Bain Capital`s main business model is
buying companies like American Pad and Paper and restructuring them. In
many instances, Bain turned a profit by strip mining these companies.
American -- AMPAD is what it`s known. The stock was driven down and the
company went bankrupt.

They fired hundreds of workers along the way. One of the people who
lost his job at an AMPAD factory in Marion, Indiana, was Randy Johnson. He
recently told ABC News what it was like to see his fellow AMPAD workers
trying to find new careers.

(BEGIN VIDEO CLIP)

RANDY JOHNSON, FORMER AMPAD WORKER: It was really one of the worst
things I think I`ve had to deal with, because people the age I am now were
at my desk crying. What did I do? I don`t have a good -- a high school
education. How do I get a GED? I just want to get to retirement.

In some cases, we had the husband and wife both working there. They
lost all income. And it doesn`t get much worse than that.

(END VIDEO CLIP)

SCHULTZ: Randy Johnson told his story to the voters of Massachusetts
back in 1994 when Mitt Romney was challenging Senator Ted Kennedy. Romney
lost that race. Randy Johnson is telling his story once again and hopes it
has the same effect.

We`re joined tonight by Randy Johnson, who is currently on the staff
of the United Steelworkers. Mr. Johnson, good to have you with us tonight.

You`ve seen this song and dance before. Do you believe Bain Capital
under Mitt Romney profited from putting people out of work?

JOHNSON: I think in a lot of times that -- during the purchase of
these companies, they learn that running up debt, developing stock,
actually putting a company out there to make the best profit for its
shareholders, but not the workers -- and that`s what they did.

It`s a scheme that kind of goes on. I think that`s proved out by some
of the board of directors from the AMPAD and some of the things I`ve heard
since then. They actually go out --

SCHULTZ: Romney --

JOHNSON: Uh-huh?

SCHULTZ: They actually do what?

JOHNSON: They actually go out and look for these companies in
distress. That`s what AMPAD was. And then AMPAD bought my plant. And
when we kind of stood up and said, wait a minute, you`re cutting our health
care; you`re cutting our benefits in all ways, shapes and form; we no
longer had a pension plan; all these things happened to us.

We said no more. And we had a labor dispute over it. Their answer
was, OK, we`re to pick the plant up, move away and just leave us, the
workers, holding the bag. Not only us, the community.

SCHULTZ: Is Romney unfriendly to labor or is he just looking to make
a dollar? What do you think his philosophy is?

JOHNSON: I`m pretty sure he`s unfriendly to labor. He has no love
there. But I think he`s out to make a buck. He`s always been out to make
a buck. That was his major thing. We have a fundamental problem whenever
all they think about is profit, at the expense of workers, families,
communities. That`s what really happens.

SCHULTZ: I want to play something Romney said at a recent debate in
Sioux City, Iowa. Here it is. Let`s take a listen.

(BEGIN VIDEO CLIP)

ROMNEY: Government doesn`t create jobs, but the private sector does.
I spent my life, my career in the private sector. I understand, by the
way, from my successes and failures what it`s going to take to put
Americans back to work with high paying jobs.

(END VIDEO CLIP)

SCHULTZ: What goes through your mind when you hear Mitt Romney say
that he knows how to put people to work after what you`ve been through?

JOHNSON: First of all, I don`t think he spent a lot of time in low-
level management working with real workers on the job. So I don`t know how
he can really tell that part of it. But it`s even bigger whenever you
start thinking about what happens to these people.

I mean, I keep going back to that. He needs to have an understanding
that just by creating wealth doesn`t do it. You`ve got to put some of that
wealth back into your jobs in the communities, so people have a chance, an
opportunity in the future.

I don`t believe he`s ever had to do that. I don`t know how he ever
worked in a plant or a factory and come out with the concept that, you
know, it doesn`t really matter what happens to the workers.

SCHULTZ: Is it true that Mitt Romney wrote you a letter when he lost
the Senate race in 1994, after you told this story?

JOHNSON: He actually wrote me a letter and faxed it in to many on the
day the plant closed. It was -- I mean, what a time to receive a letter,
when you needed help sooner, not when it closes. But he did said -- he
said no one more than him wished it hadn`t happened. That`s probably true.

SCHULTZ: But he`s anti-worker. I mean, this guy will gut jobs, ship
them overseas, run the profit to the bottom line to benefit a very few. Is
that a fair description of Mitt Romney?

JOHNSON: Yeah. I don`t think he really worries about the companies
or the workers. I think it`s about profit. It`s pure profit.

SCHULTZ: Randy Johnson, good to have you on THE ED SHOW tonight.
Thanks so much for joining us.

JOHNSON: Appreciate it.

SCHULTZ: A victory for voting rights in this country. But it is too
little, too late. Or isn`t it? Professor Caroline Heldman and Katie
O`Connor of the ACLU will join me to talk about South Carolina and other
states.

(COMMERCIAL BREAK)

SCHULTZ: ED SHOW survey tonight, I asked who will win in Iowa on
Tuesday? Nineteen percent of you said Mitt Romney; 42 percent of you said
Ron Paul; and 39 percent say Rick Santorum.

Coming up, can the Department of Justice do more to stop voter
suppression around this country? Katie O`Connor of the ACLU and Professor
Caroline Heldman coming up next with that discussion. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: For the first time in 20 years, the federal government has
rejected a state voter I.D. law. The Justice Department blocked a new I.D.
law in South Carolina from taking effect. South Carolina is one of several
states required to get federal pre-clearance on voting changes, because of
its history of racial discrimination.

The South Carolina law requires voters to show one of five forms of
photo I.D. However, the state`s own data shows registered minority voters
are 20 percent more likely than whites not to have the necessary
identification. Well, the Department of Justice says tens of thousands of
minorities in the state might not be able to vote under this law.

Predictably, of course, the Republicans are attacking the Justice
Department`s decision. South Carolina Governor Nikki Haley calling it
outrageous. RNC Chairman Reince Priebus Tweeting today, "Obama`s South
Carolina voter I.D. decision shows he`s putting the 2012 election above
policy by opposing efforts to protect against cheating and fraud."

Except, Priebus doesn`t have proof to back up his claim. The Justice
Department says South Carolina submitted no evidence that voter fraud was
actually occurring in the state.

For more, I am joined tonight by Katie O`Connor, staff council with
the ACLU Voting Rights Project, and Caroline Heldman, professor of politics
at Occidental College.

Great to have both of you with us tonight. This story is one that
just gets my blood boiling because it is about suppressing the voices of
Americans across this country.

Ms. O`Connor, let me ask you your reaction to this decision in South
Carolina? Is this the tip of the iceberg for the Justice Department?

KATIE O`CONNOR, ACLU VOTING RIGHTS PROJET: I`m hopeful that it is.
I`m hopeful that it turns the tide on the wave of voter suppression efforts
that we`ve seen over the past few years. The Department of Justice, under
Section 5, still has several other laws that it can refuse to pre-clear.
Most notably the voter I.D. law that`s coming out of Texas. But also
Alabama and Mississippi have those laws as well.

And also the Department of Justice can bring Section 2 claims in court
to challenge the same sorts of laws for those states that aren`t subject to
Section 5. So I`m hopeful that that`s exactly what they`re going to do.

SCHULTZ: And Katie, are you confident that they will do these kinds
of things?

O`CONNOR: You know, I really believe that this is -- the tide is
about to turn. I think -- you know, I think we`ve done a great job of sort
of educating the public about why these laws are bad in the first place. I
also think that the Department of Justice has finally seen it as really,
you know, sort of an emergency situation, where we`ve got ten states that
have passed voter I.D. laws in the past five years.

You know, seven states that are limiting early voting. Two states
that tried to get rid of election day registration. The list goes on and
on, as you know. So -- so I think that that`s finally sort of off the back
burner. And I do think that the tide`s going to turn.

SCHULTZ: I hope so. Professor, if the law is considered
discriminatory, why isn`t the Department of Justice rejecting similar voter
I.D. laws in other states? What do you think?

PROFESSOR CAROLINE HELDMAN, OCCIDENTAL COLLEGE: Well, I think it`s
probably because those states aren`t on the list of eight states that
require pre-clearance because of their history of discrimination, as Katie
has pointed out. He`s specifically going after South Carolina and Texas
because they`re on that list.

But Eric Holder could, under Section 2, also go after any law that is
discriminatory under the Voting Rights Act of 1965. He`s not chosen to do
that. I guess I`m a little more pessimistic, because I think it`s hard for
the average American, because of the way this has been framed as voter
fraud -- who doesn`t want to stand against fraud?

Because of the way it`s been framed by a lot of conservative outlets,
I think it`s hard to make the case that we shouldn`t require I.D. I think
it`s hard for people to understand that if they have I.D., it doesn`t mean
that everyone can get it.

So that`s the uphill battle. I think it`s a political hot potato for
President Obama to step into this mess. He will face some backlash from
people who just think it`s common sense that people should have I.D.s, even
though 11 percent of the American public does not.

SCHULTZ: Well, not everybody in this country understands how the poor
actually lives and how destitute some people can be. And they want to
throw, of course, all kinds of restrictions on them. This is a bunch of
hoops that they have to jump through if they`re going to have the process
of having their voice heard.

But, you know, professor, when you look at this, if there`s no voter
fraud, it seems to me that the Republicans are going to do everything they
possibly can to make the case to the American people that there`s fraud
everywhere. What about that?

HELDMAN: I think what we`re doing is lumping three types of fraud
together. One is voter registration fraud, which Acorn did engage in. But
these laws only affect voter impersonation fraud, which wouldn`t be at all
affecting what happened with Acorn.

The second are poll workers or others in positions of power engaging
in fraud. Again, this only deals with voter impersonation. When I have
conversations about this with folks on the right, they generally lump all
of it together and say it`s a big issue.

As you know, Ed, you`re 39 times more likely to be struck by lightning
than to engage in voter impersonation, and about 4,000 times more likely to
report a UFO. So this is not an actual problem.

And I wish that Eric Holder would go after these states, because then
they would have to justify these decisions. As we saw in South Carolina,
they weren`t able to show that there was an issue with fraud, which is the
-- the boldfaced lie upon which all of these efforts are based.

SCHULTZ: Quickly, Katie, what would be the next state you would
recommend that the Department of Justice goes after, that would parallel
South Carolina?

O`CONNOR: Sure. Well, Texas does have a submission that is waiting
for a determination by the Department of Justice.

SCHULTZ: Sure.

O`CONNOR: I think we can expect the decision sometime in the next few
weeks. And I hope that that can be -- I hope that that can be struck down
as well.

SCHULTZ: OK. Katie O`Connor, Caroline Heldman, thanks for joining us
on this tonight. I appreciate it so much. I hope it`s the tip of the
iceberg for the Justice Department.

That`s THE ED SHOW. I`m Ed Schultz. Thanks for joining us tonight.
I`ll have Rick Santorum with me tomorrow night, on tape. I`ll be in Iowa
tomorrow.

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

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