updated 1/18/2012 10:38:36 AM ET 2012-01-18T15:38:36

Guests: Chris Larson, Kathleen Vinehout, Fred Risser, Bob Shrum, Michael Eric Dyson, Sara Ferguson, George Walker

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

Wisconsin Democrats have reason to celebrate this evening. Over 1
million signatures have been delivered to recall Governor Scott Walker.

Americans, I think we need to pay close attention to this. This is
how you fight back against Citizens United.

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

(BEGIN VIDEOTAPE)

(CHEERS)

SCHULTZ (voice-over): This is what democracy looks like. The
historic recall effort in Wisconsin moves to the next phase. And Governor
Scott Walker is running to his cronies.

GOV. SCOTT WALKER (R), WISCONSIN: In our state, you don`t actually
have to be a voter to sign it. All you have to be is eligible to vote.
You can imagine al the shenanigans in there.

RUSH LIMBAUGH, RADIO HOST: Yes.

SCHULTZ: Tonight, exclusive reaction from the Wisconsin 14 and John
Nichols of "The Nation" magazine.

Mitt Romney once again shows just how out of touch he is.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I get speaker`s fees from
time to time, but not very much.

SCHULTZ: Mitt Romney`s speaker fees last year are seven times what
the average middle classer makes. Bob Shrum will break down Romney`s
disastrous day.

Newt Gingrich was blowing the dog whistle so hard last night that even
some righties couldn`t take it.

UNIDENTIFIED FEMALE: He is a rich old, fat white guy. Well, he was
condescending to Juan Williams.

SCHULTZ: Joy-Ann Reid and Michael Eric Dyson on the right wing`s
radical politics.

And last night, we told you about a radical plan to destroy public
education in Pennsylvania. Tonight, the governor --

(END VIDEOTAPE)

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

It`s a day for democracy in Wisconsin. The residents of Wisconsin
have collected nearly 2 million total signatures to recall six radical
Republicans from office in the state. The focal point of course has been
Governor Scott Walker, his government overreach, his agenda has been way
too much for these middle classers to take.

The governor`s union-busting law got the recall drive underway.
Wisconsin Democrats needed to collect about 540,000 signatures to trigger a
recall election against Walker. Today, grassroots Americans in the middle
of the country -- they delivered more than 1 million.

Walker isn`t the only elected official who is in trouble in the state.
Signatures were submitted against four Republican state senators, including
the senate majority leader and lieutenant governor. Wisconsin is now home
to the second most important election of 2012.

The recall vote could be held as early as this spring, but many are
expecting some legal challenges.

Walker, what is he doing? He is feeling the pressure. He ran for
cover to his friends in the media today calling in to Rush Limbaugh`s radio
show.

(BEGIN VIDEO CLIP)

LIMBAUGH: You`re doing what you said you were going to do, and what
you said you were going to do is working. And that`s the last thing the
left can tolerate. They just can`t tolerate this kind of success. It
disproves every belief of theirs.

I just went back and checked. The story was from December 14th, the
signatures of Mickey Mouse and Adolf Hitler will be counted on recall
petitions targeting you as long as they are properly dated, and include a
Wisconsin address.

(END VIDEO CLIP)

SCHULTZ: Once again, Rush Limbaugh doesn`t know his ass from third
base. He has not been in Wisconsin covering the story. All he is doing is
reciprocal pick up of the story, and hasn`t talked to one person from
Wisconsin about this. It`s kind of funny.

Limbaugh has tried to smear the recall effort, but over 1 million
signatures are going to prove him wrong.

Now, I met with Julie Wells today. This is a great story. This lady
is a forklift operator, a hard-working wage earner. She`s a grandmother of
12.

She volunteered to kick off the recall campaign in November. Say,
Rush, have you talked to her? She said the smears won`t work.

(BEGIN VIDEO CLIP)

JULIE WELLS, UNITED WISCONSIN VOLUNTEER: I`ve spent the last 60 days
looking at every one of the petitions coming in our office in Jefferson
County, and I wasn`t finding Mickey Mouse or Hitler or anything like that.
If he can find half of these signatures to be invalid, I wish him a lot of
luck because that`s just statistically impossible.

SCHULTZ: What`s the mood of the people here? What`s it like? I
mean, this is a hearty day in Wisconsin. We don`t care if it`s snowing.
It`s a day of celebration.

What`s the mood?

WELLS: That`s exactly right. It is the day of celebration. People
will be out in the streets partying, they don`t care that it`s snowing. We
had worse weather than this and we were all gathering signatures.

(END VIDEO CLIP)

SCHULTZ: This is what a recall looks like -- 3,000 pounds of
signatures in the back of a pick up truck, a rented U-Haul guarded by
guards, in the middle of winter in a snow fall. It won`t stop folks in
Wisconsin.

Residents of the state believe that their state was basically going in
the wrong direction. They are making a strong political statement for the
country to see what they box after box after box effort in this rented U-
Haul. Talk about organization at its best. These folks just have not
given up.

It may be the most grassroots thing in American politics that we`ve
ever seen. Compare this to Governor Walker`s support. He already banked
more than $5 million to fight this recall campaign last year. Nearly half
of that money is from out of state donors.

In fact, he was in New York raising money to save his hide. Donors
like Bob Perry, Bob Perry? Yes, the same guy who spearheaded the swift
boat veterans television ads against John Kerry back in the day.

Walker was grabbing more money in New York at a fundraiser hosted by
the founder of AIG. While the governor was getting the cash, I was talking
with the people who made this moment happen. If it wasn`t for the
Wisconsin 14, those senators who drew attention to the injustice of
Walker`s legislation last winter, we might not be here tonight.

I spoke with three of the Wisconsin state Democrats today.

(BEGIN VIDEOTAPE)

SCHULTZ: Three senators have been on the forefront of this fight to
recall Walker, Chris Larson, Kathleen Vinehout and, also, Fred Risser.
Now, this is a lot of years of experience. They have seen a lot of things
happen in Wisconsin politics over the years.

Chris, what does it mean to have this number of signatures? I mean,
if you look at what happened in California, far beyond what they did with
Gray Davis, percentage-wise, you`re almost at 24 percent, 25 percent of the
electorate. What does it mean?

STATE SEN. CHRIS LARSON (D), WISCONSIN: Right. It`s huge. And they
had twice as long in California. I mean, this is history in the making.

You`ve got over a million people from all different parts of the
state, all different background stepping up to say that they want to see a
governor, a new governor who`s going to bring our state together. And this
guy is dividing us. That`s what this says. This is history.

SCHULTZ: Kathleen, this goes beyond the Wisconsin borders, doesn`t
it? What`s the message here?

STATE SEN. KATHLEEN VINEHOUT (D), WISCONSIN: People around the state
and around the country have been worried about Citizens United and what
happens when you put money into politics. What we`re seeing here in
Wisconsin is something that`s proving to be far more powerful than money
and that is the power of the people. This is a real grassroots effort, Ed.
All across the state, we have seen the rural people, urban people, the
suburban people, pull together and say, "We`re going to take our government
back."

SCHULTZ: But if they are after workers in the middle class, that they
should balance the budget on the backs of these people, is this a stop-gap
situation?

VINEHOUT: People are looking at what`s happening all across the
country and they are saying, this is not just about workers rights. This
is about what we want our country to be. What we want it to look like.

SCHULTZ: Senator Risser, you -- four generations of your family have
represented Wisconsinites. This is a big moment.

But is this the only formula that`s going to be available to push back
against unbelievable money that`s going to be coming into the state? Is to
stay socially connected and involved?

STATE SEN. FRED RISSER (D), WISCONSIN: Ed, we`re going to transfer
Wisconsin back to the progressive, innovative state it used to be. The
people of this state can offset the money against them. There`s going to
be unlimited money in this campaign but the people are signing petitions --
tens of thousands every day for the last 60 days, brand new petitions have
been signed. We are going to do it.

SCHULTZ: What do you make of Walker doing a media tour and the help
he`s getting nationally?

RISSER: Well, he should be trying to cover Wisconsin, but it just
shows he has a national agenda not a state agenda. He`s promoting a
national right wing regressive agenda, fighting the middle class, fighting
the working family. He isn`t worried about the state of Wisconsin. He`s
trying to develop a national reputation. We`re going to change that.

(END VIDEOTAPE)

SCHULTZ: I want to highlight one of the most important things that
Senator Risser said. What we`re seeing in Wisconsin is a template to fight
back against Citizens United. You know, this is one of the most incredible
stories I think I have ever covered in the media in over 30 years, because
the people of Wisconsin have not given up.

They can`t take your vote, they can`t take your heart, they can`t take
your soul. In this situation, they just can`t take the enthusiasm of these
people of Wisconsin.

This started way back in late January a year ago. And they have gone
through the due diligence. The 14 senators that left the state, they are
still in office. Of the nine recall elections that took place last spring,
five were won by Democrats and two of those were replacing Republicans.

The bottom line here is that Wisconsin is teaching this country a
lesson. Developing the template on how to fight back against outside
influence -- and whoever they are, wherever these super PACs come together
and however they drop the money in the state, they can`t stop the middle
classers of this country and wage earners once they mobilize and get
together.

Listen to what Scott Walker -- now, you have to understand Scott
Walker is going to go out and get his support out of state. And he`s got
people in the state of Wisconsin support him as well. So, this isn`t going
to be easy. Nobody is going to come out and wave a wand and all of a
sudden, he`s going to be gone as governor. And that`s what`s so cool about
story with the people of Wisconsin that they know that this is only halfway
there, and they want to go the distance.

But listen to what Walker said to Limbaugh and the narration that they
had back and forth for a few seconds on his program today.

(BEGIN VIDEO CLIP)

WALKER: People have seen no matter how many attack ads from the big
government union bosses, the bottom line is the reforms are working.

LIMBAUGH: And so, they are living the reforms that you made. They
are demonstrable.

(END VIDEO CLIP)

SCHULTZ: Reforms -- lets talk about reforms. You know, it`s easy to
reform when you take a billion dollars out of public education. Is it
reform when you give corporations more tax cuts? Is it reform when you
give the wealthiest Wisconsinites more of a tax break and then take it out
of the hides of the hard-working people in this country? You go after the
health care, you go after their pension, you go after their wages. And in
this case, they went after their voice.

The birth place of collective bargaining in this country is Wisconsin.
This is where the buck stops. It`s going to stop on Walker`s desk and all
these others that they`ve got signatures to get rid of.

And Limbaugh, he doesn`t have a clue. Limbaugh has no clue what`s
going on in this state. FOX News has no clue what`s going on in the state.

I`ve been on the ground with these folks and I know that they are
going to get this done because they care about the next generation. This
is the unselfish state.

Now, Walker is going to get out there and talk about voter fraud.
Voter fraud? You`re going to hear about Adolf Hitler and Mickey Mouse and
everything else and all these people.

Well, let`s just count the votes, because they need 540 signatures.
Let`s just see if they have them. Let`s just see if Walker is on the wrong
side of the issue again and again. And let`s see how this all plays out.

There`s no voter fraud problems here. There`s going to be a few
signatures but it`s not going to be anywhere near as widespread. And the
fact that you have got 25 percent of the electorate signing on to get rid
of these radicals who want this agenda to stomp on the working folk of
America, underscores exactly the passion of these people.

They only had 7 percent of the electorate signed on when they recalled
Gray Davis.

You`re watch history, folks. Nowhere in this country have this many
signatures been put together to recall as many elected officials in a
state. Only two governors in the country`s history have been ever
recalled, one was in North Dakota back in the `20s, and, of course, Gray
Davis to Arnold Schwarzenegger.

So, Walker`s going to fight back. The media is going to be with him.
The conservatives are going to view this as a template.

The key here is to get the victory to get rid of Walker, because if
Walker wins, it is only going to give other radical Republicans the idea
they can win anywhere. If they can win in the birth place of collective
bargaining in the middle of the country, they`re going to feel like they
can win anywhere.

Just remember one thing, Wisconsinites, they can pour over millions of
dollars into the state all you want, all they want and how they`re going to
do it. But they can`t take your vote, they can`t take your heart and they
can`t take your passion.

Get your cell phones out, I want to know what you think. Tonight`s
question, will grassroots efforts like the one here in Wisconsin overcome
Citizens United?

Text A for yes, text B for no to 622639. And you can always go to our
blog at Ed.MSNBC.com. We`ll bring you the results later on in the show.

Coming up, Mitt Romney -- the guy just can`t help himself. He admits
his effective tax rate is close to 15 percent, and he has a funny idea
about how hundreds of thousands of dollars in speaking fees is really not
that much.

And Newt Gingrich is once again labeling Barack Obama the food stamp
president. The White House is pushing back on that. Michael Eric Dyson
and Joy-Ann Reid will weigh in on those stories tonight.

Stay with us. We`ll be right back. Lots more coming up and a story
out of Michigan later.

(COMMERCIAL BREAK)

SCHULTZ: Coming up: Mitt Romney says over $300,000 in speaking fees
isn`t a lot of money? Bob Shrum joins me to discuss how out of touch Mitt
Romney is with the middle class.

Rick Perry returns to "Psycho Talk" after linking an American ally to
terrorists?

And some good news for the Chester Upland School District in
Pennsylvania. A story we brought you last night -- we`ll go back to it
because there is a major development. We`ll tell you about that later in
the show.

Share your thoughts on Twitter using #EdShow.

We`ll be right back. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW.

What do we know about the probable Republican nominee Mitt Romney?
This guy has tried to tell the American people he`s unemployed, he`s tried
to pass himself off as a middle classer, and he`s tried to tell us that
he`s really worried about pink slips.

Today, we found out a little bit more about Mitt Romney, his effective
tax rate

(BEGIN VIDEO CLIP)

ROMNEY: Effective rate I have been paying on is probably closer to
the 15 percent rate than anything because my last 10 years I have -- my
income comes overwhelmingly from investments made in the past rather than
ordinary income or rather than earned annual income. I got a little bit of
income from my book, but I gave that all away. And then I get speakers
fees from time to time, but not very much.

(END VIDEO CLIP)

SCHULTZ: Good for you, Mitt.

Romney is already under pressure to release his tax returns. So here
he is, trying to break the news to the American people about how he pays a
lower tax rate than many middle class Americans?

Then he casually says the money he gets from speakers fees is not very
much. But according to his own financial disclosure forms, Mitt Romney
made $374,327 in speaker fees in one year. That ain`t bad on the rubber
chicken circuit, folks. That is what Mr. Out of Touch thinks is not very
much?

No, it`s real good. The median household income in American is just
$49,445. So you tell me, is he in touch? Romney`s speaking fees were more
than seven times the median household income in this country?

Today, Newt Gingrich had some fun with Romney`s tax rate.

(BEGIN VIDEO CLIP)

NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: He ought to release his
taxes and find out whether or not it was really 15 percent. And second, I
think that we ought to rename our flat tax. We have a 15 percent flat tax,
this will be the Mitt Romney flat tax that all Americans could then pay the
rate Romney paid. That is just terrific.

(END VIDEO CLIP)

SCHULTZ: Let`s turn to Bob Shrum, Democratic strategist and professor
at New York University.

Bob, great to have you with us tonight.

I mean, Romney and his 15 percent tax rate - you know, there are
wealthy people out there that say hey, that is the law, we`re going to work
the system the best we can. This is the way you manage your money in
contemporary times.

But the disconnect and then the comment about the $374,000 in speaker
fees as not being very much -- how is this going to play? This is what you
want your candidate to do in front of the public in front of the cameras?

BOB SHRUM, DEMOCRATIC STRATEGIST: It sure isn`t, but it`s what I want
their candidate to do. Look, this guy is out of touch. Not just the
$374,000. This is a guy who says he likes firing people, tries to make a
$10,000 bet.

I`ll bet that when he finally releases these tax returns and you know
it took him 180 biffing and farbling words in the debate the other night to
answer that question, when he finally releases them under pressure, I`ll
bet he didn`t pay quite 15 percent. That`s why he`s being careful to say
around 15 percent.

I`ll also bet that they`ll release the 2011 returns, because they can
carefully engineer those to the needs of the campaign.

What we need to see are the returns going all the way back to 2000,
which is what President Obama has released, because we have to find out
whether or not this guy paid no taxes in some years or paid almost no
taxes.

Right now, he is -- maybe the strongest Republican candidate in this
ridiculous field, but he`s in some ways a perfect foil for the argument
President Obama wants to make about whose side are you on?

SCHULTZ: You know, politicians go in crowds and they kiss babies,
because they want to feel connected to people. And then this guy might do
that but then he goes in front of the camera and says, well, $375,000, well
it puts him in the top 1 percent of income earners in America, then he
says, well, it`s not that much.

I mean, could something like this haunt him along the campaign trail
for a long time? Is he going to have to mop this up? I mean, politicians
are in the image business, what a horrible image it would seem. What do
you think?

SHRUM: Yes. And it`s not that he`s rich. Look, Franklin Roosevelt
was rich. John Kennedy was rich. They never would have said anything like
this. They understood the needs and travails and the hopes and the
disappointments of ordinary people.

He seems entirely disconnected from it. And maybe that`s because of
his years of experience at Bain, where in a lot of cold-blooded ways, they
just laid people off, took away their health insurance, did all sort of
other things to turn a profit for themselves.

You know, he thinks he`s going to explain Bain by saying we had some
successful companies. That`s not the question. The question is, what
about the companies that failed, even if they got a federal bail out, what
about the companies where all the workers lost their jobs, they went down
and Romney and his partners still made tens of millions of dollars.

There is a new poll out showing that even Republicans are beginning to
worry about that. It`s up to about 34 percent disapproval of his business
record. That tells you it`s going to be a very powerful issue in the
general election.

SCHULTZ: Well, I think it gives the American people a snapshot of
Romney`s business experience in that he`s dealing with millions that he
would actually come out and not realize how callous he is and disconnected
from the American middle class by saying, you know, $375,000. It`s really
not that much. I had some speaking fees.

Here are more Romney classics for you. Here we go. Let`s take a
look.

(BEGIN VIDEO CLIPS)

ROMNEY: Well, I should also tell my story, I`m also unemployed.

(LAUGHTER)

ROMNEY: There were a couple times I wonder whether I was going to get
a pink slip.

I like being able to fire people who provide services to me.

Ten thousand bucks, $10,000 bet?

GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: I`m not in the
betting business.

(END VIDEO CLIPS)

SCHULTZ: I mean, this guy is looking like a phony right now. He`s
portraying himself to the American people something that he simply is not,
what do you think?

SHRUM: He`s revealing his real self. His real self is totally
removed. His real self is in this take over world, that is where he made
his money.

I think as I have said to you before -- his whole campaign for the
presidency is a business plan. It`s not a core of conviction. And I got
to say, Rick Santorum and Newt Gingrich are right about that.

This guy is saying what do the Republican primary voters want, I`m
going to give it to the. I`m going to see if I can go out there like I
took over some of these companies and see if I can take over the White
House.

And I think we`re going to see more and more of this as the campaign
goes on.

SCHULTZ: Yes.

SHRUM: Because they have one of two choices -- either he`s going to
be in a very tight box where he`s very, very awkward, or is he going to be
allowed to go out there and say what pops into his head. And what pops
into his head and out of his mouth is often far more revealing of his true
character than the people running the campaign would like.

SCHULTZ: You know, I just -- Mitt Romney does not come off as a guy
who cares about average Americans. President Obama does.

It`s the image business. It will be real interesting to see how it
plays out.

Bob, always great to have you with us here on THE ED SHOW. Appreciate
your time tonight.

SHRUM: Thanks, Ed.

SCHULTZ: In "Psycho Talk" tonight, Rick Perry is back again, this
time it`s for referring to U.S. allies as Islamic terrorists. His moronic
comment is coming up next.

And moderates -- oh, they are sick of the Republican Party`s radical
views. A new poll is out, and it says pretty interesting stuff. We`ve got
numbers. Joy-Ann Reid and Michael Eric Dyson will provide analysis.

Stay with us. We`ll be right back.

(COMMERCIAL BREAK)

SCHULTZ: And it`s "Psycho Talk" tonight.

Rick Perry`s back in the limelight for the second night in a row. You
know, we`re going to really miss this guy.

During the FOX News debate last night, he was asked whether he thought
Turkey should remain in NATO. Here is Perry`s moronic answer.

(BEGIN VIDEO CLIP)

PERRY: Obviously, when you have a country that is being ruled by what
many would perceive to be Islamic terrorists, not only is it time for us to
have a conversation about whether or not they belong to be in NATO, but
it`s time for the United States when we look at their foreign aid, to go to
zero with it.

(END VIDEO CLIP)

SCHULZ: I want to know who on his debate team, his prep team, gave
Rick Perry the go ahead to call Turkish leaders Islamic terrorists. And
clearly, no one explained to him the basic facts about foreign aid.

Now, "The Associated Press" points out Turkey does not receive U.S.
foreign aid. The United States does provide military assistance to Turkey
because they are our allies. In fact, the United States radar warning
system went in effect in Turkey yesterday. The radar station is part of
NATO`s missile defense system to protect against the threat of Iranian
ballistic missiles.

Meanwhile, Rick Perry`s complete ignorance practically set off an
international incident. Turkey`s Foreign Ministry released a statement
accusing Perry of baseless and improper claims. The United States State
Department was forced to do damage control, saying "we absolutely and
fundamentally disagree with Perry`s assertion."

But I think a prominent Turkish columnist put it best. He Tweeted
"Rick Perry, what an idiot."

But Perry is not backing down. He has that old Texas attitude.
Today, he stood by his statement. Fortunately for Rick Perry, the guy is
low in the polls and his words don`t carry much weight. But dude, you`ve
got to take it back to the ranch. I mean, it`s over. You can`t be doing
this to other countries around the world.

Calling our allies -- our long time allies Islamic terrorist is dumb,
irresponsible Psycho Talk.

(BEGIN VIDEO CLIP)

NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: The fact is that more
people have been put on Food Stamps by Barack Obama than any president in
American history.

(END VIDEO CLIP)

SCHULTZ: Newt was given them red meat at the debate. Today, he`s
raising money over his dog whistle.

(BEGIN VIDEO CLIP)

GINGRICH: I`m Newt Gingrich and I approve the message.

(END VIDEO CLIP)

SCHULTZ: More racist news letters from Ron Paul are released. "The
Grio`s" Joy-Ann Reid and Michael Eric Dyson are here with reaction.

Last night, we shined a light on the radical assault on public
education in Pennsylvania. Today, the governor blinked. Breaking news on
the Chester School District ahead.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GINGRICH: I hope my four colleagues would agreed here -- it tells you
everything you need to know about the difference between Barack Obama and
the five of us. We actually think work is good.

And we think unconditional efforts by the best Food Stamp president in
American history to maximize dependency is terrible for the future of this
country.

(END VIDEO CLIP)

SCHULTZ: That was Newt Gingrich humoring the crowd last night,
belittling both President Obama and the millions of Americans who are just
trying to put food on the table. Today, the White House had a word for
Gingrich`s kind of talk.

(END VIDEO CLIP)

UNIDENTIFIED MALE: The language that the speaker uses is that these
are people that President Obama put on Food Stamps.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: You know as well as I do
that that is crazy.

(END VIDEO CLIP)

SCHULTZ: The facts are not on Gingrich`s side. The majority of the
people who receive Food Stamps -- they are white. Most of them are either
children or the elderly.

Many Food Stamp recipients, hey, they earn a paycheck, Newt. They
have a job. South Carolina Congressman Jim Clyburn called Gingrich`s
claims denigrating to the president of the United States and to the poor of
this country.

Fox News`s Eric Bolling trying to go toe to toe, head the line for the
Gingrich team.

(BEGIN VIDEO CLIP)

ERIC BOLLING, FOX NEWS ANCHOR: What is denigrating about calling him
the Food Stamp president? He is the leader of the largest, widest
expansion of the Food Stamp program in American history.

REP. JAMES CLYBURN (D), SOUTH CAROLINA: Simply because he also
inherited the biggest economic problem we`ve had since 1929. If you got
2.1 million people losing their jobs in the last 90 days of the Bush
administration, they are going to find a way to try to eat while they try
to recover from that.

(END VIDEO CLIP)

SCHULTZ: Remember, the number of Americans receiving Food Stamps, now
known as the Supplemental Nutrition Assistance Program, did increase under
President Obama. But as Congressman Clyburn of South Carolina pointed out,
the economic conditions created by the Bush administration that President
Obama inherited had a heck of a lot to do with it.

Gingrich, he is not backing down. Instead, he`s taking a victory lap.
Here is part of his latest political ad.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Only Newt Gingrich can beat Obama.

GINGRICH: More people have been put on Food Stamps by Barack Obama
than any president in American history.

I believe every American of every background has been endowed by their
creator with the right to pursue happiness. And if that makes liberals
unhappy, I`m going to continue to find ways to help poor people learn how
to get a job, learn how to get a better job and learn some day to own the
job.

(END VIDEO CLIP)

SCHULTZ: Let`s bring in Joy-Ann Reid, MSNBC contributor and managing
editor of "The Grio," and Michael Eric Dyson, with us tonight, MSNBC
political analyst, Georgetown University professor and author of the book
"Can You Hear Me Now?"

Michael, I will ask you first, will this type of dog whistle politics
work for Newt Gingrich deep in the heart of Dixie, down in South Carolina?
Is this who he is? Or is he just doing this for politics?

MICHAEL ERIC DYSON, GEORGETOWN UNIVERSITY: Well, it`s both. I think
that he certainly will get an advantage down with the Dixiecrats. He will
get an advantage with those in the deep south who don`t understand that
Newt Gingrich is really speaking against their best interests.

As you`ve indicated, the empirical evidence, the facts prove that most
people on welfare and on Food Stamps are white, like Mabel McFiggen (ph),
the woman who first received them in 1939 as a supplement to her own
paycheck and a way for the government to try to aid those who are most in
need.

The safety net had been shredded. The Depression had besieged this
country. And people needed to be helped.

Now Newt Gingrich is trying to tar and feather Barack Obama with the
notion of being a Food Stamp president, which means that he`s helping white
Americans. And number two, that because of the failed policies of the Bush
administration, that Obama has tried to address, he`s had to assist other
people, not leaving them to the side of the road.

I think he`s the compassion president. He`s the president who has
looked out and seen the need to help those who are poorest.

SCHULTZ: Here is another sound bite from last night`s debate. Joy-
Ann, I want to get your reaction to this. Here it is.

(BEGIN VIDEO CLIP)

JUAN WILLIAMS, FOX NEWS CONTRIBUTOR: Speaker Gingrich, you recently
said black Americans should demand jobs, not Food Stamps. You also said
poor kids lack a strong work ethic, and propose having them work as
janitors in their schools. Can`t you see that this is viewed, at a
minimum, as insulting to all Americans but particularly to black Americans?

GINGRICH: No. I don`t see that.

(END VIDEO CLIP)

SCHULTZ: Joy-Ann, what about the crowd reaction? We`ve seen this at
other Republican debates, but last night it was very prominent. What do
you make of it?

JOY-ANN REID, "THE GRIO": Yes, it`s incredible. I mean, Republican
debates are where you go to sort of find the lowest common denominator of
their base. But I think the strategy of doing these sort of dog whistles,
which, by the way, seems to always happen when we get to South Carolina --
this is where John McCain supposedly had a black baby.

This is where Barack Obama was just like Jesse Jackson. South
Carolina is the place where the primary goes racial, every single time. So
it`s not surprising that this is the strategy.

But this is what Republicans think about their base. They understand
that you want to push certain buttons with certain elements of their base
that happen to be about denigrating people who are poor, raising up the CEO
as some sort of superman and making it seem like, well, those black and
brown people are taking your stuff and taking your money, so let`s get
their president out of the White House.

SCHULTZ: I want to ask both of you this. And you first, Joy-Ann.
Should the Obama administration, the campaign, go after this talk,
challenge the Republicans on this kind of talk? It`s like they all think
the same. Nobody was countering Newt Gingrich up there last night. Should
this be a focal point for the Obama campaign to really go after?

REID: I don`t think they necessarily have to jump into the middle of
the Republican primary right now. But I think what you just said, Ed, is
the point. The guy who is going to be the nominee, Mitt Romney said
absolutely nothing. He has not refuted these kind of arguments, these
kinds of really low-down arguments that try to appeal to the worst in
people`s sort of tribal nature.

He has said nothing. So when we get to the general election, these
kind of statements by people he stood beside on stage should come back to
haunt him.

SCHULTZ: Go ahead, Michael.

DYSON: I was just going to say, very quickly, I know Strom Thurmond
was supposed to have a black baby. I didn`t know about John McCain. The
reality is that in South Carolina, as in the greater south, that the Obama
administration has to situate itself as an argument against this kind of
vicious indifference to the poor. And I think they need to learn from John
Kerry. You can`t get behind this stuff.

You don`t want to be racially Swift Boated here. You want to get out
in front of the curve and begin to talk the facts that will counteract some
of this negative vitriol and this propaganda.

SCHULTZ: I think the Obama team owes it to the country and I think
they owe it to the supporters to come out and go right at this kind of
rhetoric that we know is going to be coming from the Republicans on the
campaign trail.

Joy-Ann Reid, Michael Eric Dyson, stay with us. We have more to talk
about.

Good news for President Obama going into the general election. We`ve
got some poll numbers. You`ll want to see them.

And what is happening in Pennsylvania with teachers? A new
development, that`s next. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: There was a lot of radical stuff going on last night at the
Republican debate in South Carolina. One group who seems to be turned off
by it are moderate voters. Take a look at the latest poll numbers from the
Public Policy Polling. In a general election match-up with Mitt Romney,
President Obama comes out on top 49 to 44. It`s the president`s best
standing against Romney since the death of Osama bin Laden back in May.

But what really stands out is how the president fares with moderate
voters. He`s doing really well, beating Romney by over 40 points, 68 to
27. Now the president`s reelection campaign is laying down the ground work
for a major TV ad buy. "Los Angeles Times" reports the campaign requested
TV rates in over a dozen states, primarily in swing states. It`s the first
step the campaign needs to take before deciding to purchase air time.

Let`s go back to our panel tonight. I`m joined by MSNBC contributor
Joy-Ann Reid and MSNBC political analyst Michael Eric Dyson.

Newt -- these poll numbers, I want to ask you about these poll
numbers. It`s a snapshot in a long campaign. Michael, can President Obama
keep this advantage? What do you think?

DYSON: Well, yeah, but you have to be strategic about it. I think
the Obama campaign understands that if they secure the support of the
moderate voters out there, those who are not swinging so far to the right
that they are listening to the dog whistles of this racist Republican
reactionary agenda of these leading candidates -- especially Newt Gingrich
and less so Ron Paul -- then I think what happens is that Obama is able to
situate himself as a reasonable person who is able to respond to the needs
of the country.

The economy is still the big deal here. Even though there is some
questions about whether or not he can handle that economy, I think the
moderates begin to understand that he inherited such a horrible situation.
He has made initiatives, as Jim Clyburn -- Representative Jim Clyburn said
-- to try to really deal with the situation that he inherited.

And now people are willing, I think, in that light, if he makes the
argument cogently, to give him four more years to try to put this country
back on the right path.

SCHULTZ: Joy-Ann, what about the Rust Belt? What about Wisconsin?
What about Ohio, Indiana, Illinois, Michigan, Ohio? Do you think that the
president would beat Mitt Romney in those states today? Because as Michael
says, the economy is so terribly important.

REID: Absolutely. Two things that I think advantage Barack Obama
going into the November election. Number one, 2010. In 2010, voters
actually elected Tea Party governors, in several swing states, in
Wisconsin, in Ohio, in Florida. Now they have gotten to experience for
almost two years what it`s like to live under their philosophy.

People don`t like it. Surprise, surprise, people don`t like it when
you cut public services. They don`t like it when you don`t build rail and
things that they need, when you don`t provide jobs.

And this sort of Ayn Randian social Darwinist theory sounds great on
talk radio. But talk radio is a tiny sliver of the universe of the 300
plus million American people. So Mitt Romney I think has made an error
trying to run to right wing talk radio, which really isn`t a majority view.

So I think the president has that advantage. Number two, the Occupy
Movement has really done one great thing. It has focused people on
inequality. If anybody represents the one percent, it`s Mitt Romney. So I
think that the president is looking pretty good going in 2012, the
election.

SCHULTZ: All right, let`s look at the Republican race. Ron Paul out
today, saying that it`s a two-man race between him and Mitt Romney.
Meanwhile, a new batch of Ron Paul newsletter has come out.

Here is a quote from one of them: "we don`t think a child of 13 should
be held as responsible as a man of 23. That`s true for most people, but
black males age 13 who have been raised on the streets and who have joined
criminal gangs are as big, strong, tough scary and culpable as any adult
and should be treated as such."

Michael, your response to that? That is Ron Paul.

DYSON: This man -- this is the super predator thinking of the 1970`s
when that theory came out, in the early `80s, that African American people
were preternaturally inclined, almost naturally gifted with an evil genius
of crime.

This is just horrible. This is almost ripped from the headlines of
Tarzan meets Jane, and the jungle aspect of African American culture. Look
at all the vicious stereotypes coming together to form a cohesive social
theory that Ron Paul articulates.

It`s not only scary. It`s misinformed. And if he is given power by
the state to exercise his viewpoints, we`re in for an Orwellian future.

SCHULTZ: Joy-Ann, what role do you think Ron Paul plays at this
point? I have a feeling after Saturday, everybody is going to be getting
out, except maybe Ron Paul. He says it`s a two-man race. He has the money
to keep going. But is this kind of rhetoric going to dog the Republican
party throughout all of this?

REID: Yes, they are stuck with him. Listen, Ron Paul really is the
only actual alternative to Mitt Romney, because the Evangelical vote is so
split. So there really isn`t an alternative. Ron Paul is not going to be
president, clearly.

But what I would say is, number one, yes, it is going to dog the
Republican party. But what I would also say to my liberal libertarian
leaning friends, what more does Ron Paul have to have said in his
newsletters for you to see that there is something viciously wrong?

SCHULTZ: That is a great question. That is it. Some people are
really infatuated with his foreign policy, his tax policy, socially
liberal, fiscally responsible all that stuff. But if you are a decent
human being and you see stuff like that, I mean where is the line in the
sand going to be drawn with these people? That is the question.

Joy-Ann Reid, Michael Eric Dyson, always great to have you with us.

Thanks so much for joining us tonight.

Up next, Pennsylvania public schools, they went around against the
Republican Governor Tom Corbett`s effort to kill off an entire school
district. But the fight, let me tell you something, folks, it`s far from
over. Two teachers who are fighting for their students will join me. It`s
a story we brought you last night. We`re back with more information
tonight. This is how you fight back. We`re right back.

(COMMERCIAL BREAK)

SCHULTZ: Finally tonight in the Big Finish, I am happy to report a
small victory for the teachers in Chester, Pennsylvania, who have been
working for free after their school district ran out of money. We brought
you this unbelievable story last night. And today, just today, the state
has agreed to cough up 3.2 million dollars. The amount is supposed to last
until February, when the Chester Upland School Board heads back to court.

They are suing for 20 million dollars, after the state denied their
request for enough funding to stay afloat through the end of the year.
This is what happens when Republicans slash budgets, and put tax breaks for
oil companies ahead of children`s education. Pennsylvania Governor Tom
Corbett cut 900 million dollars in state education funds last year.

But budget cuts aren`t the only problem; 45 percent of Chester
Upland`s operating budget goes to two district charter schools. Well, the
largest of the schools was founded by the largest single donor to Tom
Corbett`s gubernatorial campaign. And even though the charter school is
under investigation for test score irregularities, it`s doors remain open
while the public school system fights to survive week by week, and the
teachers work for nothing.

Yes, my friends, this is America. Shamefully, it`s America. We need
to do something about it.

I`m joined again tonight by Sara Ferguson, an elementary school and
math literacy teacher in the Chester Upland School District. Also tonight,
George Walker, a middle school special education teacher in the district.

Mr. Walker, good to have you with us tonight. What will three million
dollars more mean to your district? How long will those funds last? Is
this a good development today?

GEORGE WALKER, TEACHER: It`s a fair development. These funds will
only last to the end of the month, just to the end of January. And the
teachers, we`re still working. We`re still working to teach our children.
We are coming to work every day. And this was money that was owed to us.

SCHULTZ: And Sara Ferguson, right now your career is in your heart
and in your soul and in your dedication. And it`s going to be in the hands
of a lawsuit to the tune of 20 million dollars to try to get the money out
of Pennsylvania. How does that make you feel tonight?

SARA FERGUSON, TEACHER: It`s just unfortunate in the United States of
America that a student`s address and zip code can determine their worth and
their right to a quality education. And I just want everyone to know that
whether we got this 3.2 million dollars or not, the support staff, the
teachers, the community, the parents, we are all committed to the students.

Our actions -- our commitment goes beyond words. We`re prepared to
show it in our actions. And in February, if we don`t receive more funding,
we will show it in our actions, because we will remain on the job for our
students.

SCHULTZ: George, how do the charter schools play into the problems
public schools are having right now in the district?

WALKER: Well, the charter schools are the ones that are taking the
money from the public schools. And it definitely affects us because we
don`t have any money. Our funding has been cut. As you see, what we`re
facing now, trying to -- we come to work every day teaching our students.
We love our students. We want our students to achieve. WE are the role
models for our children.

And our children love us and the parents. And it`s very difficult to
maintain that type of level of education when your budget has been cut.
You have no money, no materials to do the job that you love to do.

SCHULTZ: Sara, the political connection with the governor and the
charter schools, how does that gall you?

FERGUSON: You know, I don`t know exactly what role this is playing
with us. I don`t -- that is someone else`s battle. My battle is for the
people on the front lines. I wish you could see the students faces. They
are bright. They`re capable. They come to us eager to learn. And they
are the true faces that are on the front line of this battle.

And --.

SCHULTZ: They deserve a better fate. There`s no question about that.
I`m going to visit this school district. I`m going to visit this school
district in the coming days.

WALKER: Thank you.

SCHULTZ: I want to see the students, see the conditions what you`re
teaching under and I want to know why this money is not going to -- why is
it a lawsuit? I mean, it`s unbelievable.

Sara Ferguson, and George Walker, thanks for your time. I hope to
meet you some day when I`m down there.

That`s "THE ED SHOW." I`m Ed Schultz.

THE RACHEL MADDOW SHOW starts right now.

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

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