updated 3/29/2004 10:38:52 AM ET 2004-03-29T15:38:52

Guests: Mark Leibovich, Dee Dee Myers, Jennifer Granholm, Bill Owens, John Lehman

CHRIS MATTHEWS, HOST:  Tonight a HARDBALL special report on the war against terrorism. 

Meet the soldiers, America‘s wounded G.I.‘s back from the front lines. 

Share their experiences and the new goals they now face at home. 

And he‘s back.  Bill Clinton is back on center stage. 

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews. 

It‘s the dueling stump speeches as President Bush and John Kerry both campaigned today on the issue of the economy. 

Kerry promises 10 million new jobs in four years, while President Bush touts strong home ownership as a sign of recovery.  But who will voters believe?

And America‘s soldiers recovered physically and emotionally from the wounds of war.  We‘ll talk to several men about their time in Iraq, in Afghanistan, and to an army doctor about the recovery process. 

But first, President Clinton rallies the party faithful and sets the tone for the Democrats‘ attack on George W. Bush. 

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES:  In the Vietnam era which marked us all, most young men, including the president, the vice president, and me, most of us could have gone to Vietnam and didn‘t go. 

And John Kerry said, “Send me.” 

Then, when it was all over and it was time to heal up and normalize relations with Vietnam, if we could get an accounting, a full accounting of all of our POW‘s and MIA‘s, and we needed someone who had been there to stand up and take a leadership role, John Kerry said, “Send me.” 

And when almost nobody in the Congress was really interested in all these poor children that were living in horribly violent neighborhoods when I became president, there was hardly anybody that really cared about what these kids were going through.  The person in the Senate who talked to me all the time about it was John Kerry. 

When he looked into the eyes of those poor kids growing up on mean streets, he said, “Send me.” 

We know we‘re going in the wrong direction.  He knows what to do to turn it around.  So I ask you to do just one simple thing.  I ask you to look at John Kerry tonight and say to him what he has said to us his entire adult life: “Send me.” 

God bless you and thank you. 

(END VIDEO CLIP)

MATTHEWS:  Dee Dee Myers was the first White House press secretary under President Clinton and Mark Leibovich is the “Washington Post” reporter who covered last night‘s Democratic unity dinner. 

Let‘s go a nonpartisan person first there.  Mark, what do you think of Clinton‘s performance last night as a reporter?

MARK LEIBOVICH, “THE WASHINGTON POST”:  As a reporter, it was terrific.  But you know, sort of putting on a political hat.  He‘s sort of damned if he does, damned if he doesn‘t. 

On that one hand, he gives a great speech.  The place was hushed.  Everyone was buzzing afterwards.  And on the other hand, Kerry got up and spoke afterwards and obviously, Clinton is an impossible act to follow. 

And as soon as Kerry got up, I mean, you could literally see people getting up, going to the restrooms and maybe even the exits.  So I think that‘s a balance they‘re going to be struggling with in the next eight months. 

MATTHEWS:  It reminds me of George McGovern being introduced at the convention back in Miami in ‘72 by Ted Kennedy. 

Dee Dee, the president‘s motive, the former president‘s motive.  I can think of three.  He really doesn‘t like the way the Bush people have talked about his presidency.  What do you think of that?  Is that a good motive?

DEE DEE MYERS, FORMER WHITE HOUSE PRESS SECRETARY:  That‘s absolutely a good motive. 

MATTHEWS:  He really is a Democrat and cares about policy. 

MYERS:  No question about it.  

MATTHEWS:  And three, is this really the third?  Or is there a phantom third.  He really wants John Kerry to be the next president of the United States. 

MYERS:  He really wants John Kerry to be the next president of the United States.  President Clinton‘s detractors have always wanted to say he was all about politics and self-promotion, but that ignores the fact that the guy really does care about policy.  He cared about the direction of the country and he‘s just baffled by...

MATTHEWS:  Well, what‘s Hillary up to?  Hillary was there last night.  She wants to be president in the worst way.  Everybody knows it.  If John Kerry wins, two terms of four years.  Hillary‘s going to have to take a back bench for the rest of her career. 

MYERS:  She is still reasonably young.  She‘s only 56 years old.  Even if Kerry serves for eight years.

MATTHEWS:  Is this a 2012 strategy? MYERS:  Why not?  Why not?

I think the most important thing to the president, President Clinton and Mrs. Clinton, is to get George Bush sent back to Crawford, Texas.  And I think, you know, you‘ll see—The proof of that will be in the pudding in the next eight months.  And I think both of them will campaign very hard for Kerry. 

This Democratic Party, Chris, I know you can‘t believe it, but they‘re really united behind Kerry.  In opposition to Bush, partly, and also, I think people find Kerry to be a good strong nominee.  He‘s not going to set the house on fire like Clinton does, though. 

MATTHEWS:  It‘s just that Clinton is sometimes at his best when he‘s lying.  He really is impressive when he‘s lying.  And there he reminded me of the time he said, “I did not have sexual relations with that woman.” 

When he closes his eyes and he gets really kind of teary eyed and he gets really emotional, it seems the most fraudulent. 

MYERS:  Yes, but that wasn‘t—there was no anger in what we just saw.  It was Clinton leading the orchestra. 

MATTHEWS:  He‘s taller than President Carter.  I see that. 

Here‘s Bill Clinton responding to President Bush‘s ad attacking Kerry‘s voting record on Iraq.  And this is good stuff.

(BEGIN VIDEO CLIP) 

CLINTON:  So they‘re running this big ad because Senator Kerry didn‘t vote for the appropriations for Iraq. 

Go look at the vote.  Was there ever a doubt it was going to pass?  No.  What John Kerry wanted to say is, “Mr. President, I voted to give you the authority and you promised me you‘d let the U.N. do their job.  And you didn‘t let the U.N. do their job.  You cut them off.  This is my protest.  I want people to know that.”

That doesn‘t have anything to do with not taking care of the troops. 

John McCain voted against several defense budgets when Al and I were in the White House.  No one ever accused John McCain of compromising the security of America.  Get off my back.  That‘s another one of those bogus ads that they can‘t wait to run because they don‘t want people to think. 

(END VIDEO CLIP)

MATTHEWS:  That is so good politics. 

MYERS:  Good politics.

MATTHEWS:  He did something John Kerry didn‘t know how to do, which was explain that vote. 

MYERS:  Well, you know, and four years ago, it was Bill Clinton, the same thing.  The thought bubble over his head was, “Al, watch me do it.”  And now the thought bubble over his head is, “John, here‘s how you do it.” 

And I watched Clinton go from not being able to do that when he first started campaigning to being able to do that. 

MATTHEWS:  Well, he can do it. 

Mark, I don‘t know about your political views of that, but I‘ve never seen a better piece.  It wasn‘t spin.  He simply said nobody on God‘s earth believes it was a decisive vote when Kerry voted against the $87 billion for reconstruction.  He simply was registering an obvious protest. 

LEIBOVICH:  Well, what‘s also striking is that, you know, Clinton said in about 45 seconds what Kerry has probably taken about 10 minutes on average to say over the last three or four months. 

So I mean, again, I think the succinctness, the punchiness is really striking in a contrast to what Kerry has been able to do.  And he‘s obviously—he‘s getting better on the stump, supposedly, but he also obviously doesn‘t pack the punch of a Bill Clinton. 

MATTHEWS:  What was your crowd meter like last night?  How gung-ho are the Dems?

LEIBOVICH:  How gung-ho the Dems?  Very gung-ho.  I mean, obviously, it‘s not—I mean, I think the whole unity thing is a little bit overstated, if not a lot overstated.  Because it‘s very easy to unify a Democratic Party when, you know, the party faithful is all gathered into the same room. 

It‘s a very different thing to be unified when swing voters are in play, when you‘re in, you know, venues like Florida and Ohio that obviously are not going to be, you know, packed for the partisans in one room. 

MATTHEWS:  I think they act like they‘ve been out of office eight years, not four.  They seem hungry to get back.

MYERS:  Absolutely.  And...

MATTHEWS:  Maybe they need the jobs more than the Republicans do. 

MYERS:  The party wasn‘t this unified in ‘92. 

MATTHEWS:  Not...

MYERS:  Exactly.  That primary went on a long time and people were very ambivalent about Clinton once he was the nominee.  But he went on to win.

Clinton presents a unique problem in American politics.  We‘ve never seen a tremendously popular incumbent president who still had so much to give.  Reagan...

MATTHEWS:  I think they‘d elect a polar bear to get that other guy Bush out of there. 

MYERS:  Well, I think that‘s probably true, too.  But I think figuring out how to use Clinton is an interesting challenge. 

MATTHEWS:  OK.  Thank you very much, Dee Dee Myers.  As always, what a drama. 

And Mark Leibovich, thank you.  Great report today.  Great tonight. 

Thank you for coming on Friday night. 

And if you want to see Clinton‘s entire speech from last night, log on to HARDBALL.MSNBC.com.  Come on, junkies.  It‘s a good speech. 

Coming up, John Kerry promises—where do they get these numbers?  Ten million new jobs in four years.  But can he really make good on that promise?  We‘ll talk to Governor Jennifer Granholm of Michigan when we return. 

And later, America‘s wounded sons and daughters, our special report on how the war on terrorism, actually the war in Iraq, has changed the lives of the wounded men and women who served our country. 

You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Coming up, President Bush and John Kerry, both stumping today on the economy.  Will that be the deciding issue for voters in this election?  We‘ll talk with Governor Jennifer Granholm of Michigan and Bill Owens of Colorado about it when HARDBALL returns.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE:  Under President Bush, three million more Americans have slipped into poverty, and four million more have lost their health insurance.  We‘ve gone from record surpluses to record deficits. 

America cannot afford four more years of a president who is the first president to lose jobs since Herbert Hoover and the Great Depression. 

(END VIDEO CLIP)

MATTHEWS:  That was Senator John Kerry, outlining his plan for the economy and one of a number of speeches planned for the weeks ahead. 

I‘m joined right now by Michigan Governor Jennifer Granholm, who supports Senator Kerry. 

Bottom line, Governor, how does a Democrat create jobs when there are no jobs right now?  What do you do?  What‘s the magic trick?

GOV. JENNIFER GRANHOLM, MICHIGAN:  Well, I think one of the things that he talked about today was providing incentives for corporations not to ship their jobs overseas. 

He said that he has a tax plan.  In fact, there are—it‘s an odd tax structure we have that actually rewards the offshoring of jobs and of work.  And so if we can bring that back home and level the playing field, I think that‘s one way, certainly, to create jobs. 

Today he said he would create 10 million job in the first four years.

MATTHEWS:  well, Governor, a recent poll of more than 200 economists found that global competition was not hurting the economy. 

More than 65 percent said free trade was having no negative impact on jobs.  Thirty-one percent called the effect small.  And nine percent said it was a significant problem.  Are you with the nine percent?

GRANHOLM:  Who was that a poll of?

MATTHEWS:  Economists. 

GRANHOLM:  Yes.  Right.  This is—You‘re talking to a governor who sees this every day.  There may an recovery on Wall Street but not on Main Street. 

I can tell you the average citizen out here in Michigan, when we‘ve seen a loss of 300,000 jobs, this is very real.  We haven‘t seen the economy come back in the way they‘re talking about it coming back with all of the economists out there.  I want to see the reality here in Michigan. 

MATTHEWS:  Well, what good is to it put up tariffs?  Or in other words, raising taxes on imports?  What good does that do to jobs?

GRANHOLM:  Well, that‘s not what he‘s talking about.  Be very clear about this.  He‘s not talking about protectionism.  He‘s saying, let us make sure that we are not subsidizing the offshoring of jobs. 

What happens now under the tax code is that there‘s an ability for American corporations with foreign subsidiaries to defer their income tax payments until—their tax payments until they come back.  They may never come back. 

And so what he‘s saying is what an odd situation it is that the American taxpayer is subsidizing this situation where you get that huge tax break. 

Let‘s bring it back.  Let‘s make sure that we give an overall corporate tax cut.  That‘s not something that Democrats often talk about.  But he‘s saying, we need to make sure that we make the business case for businesses to be able to grow jobs in the United States. 

MATTHEWS:  Do you believe the United States Treasury Department can collect taxes on operations way overseas like in Bangalor?  How do we get over there and collect taxes?  How‘s it done?

GRANHOLM:  Well, I think—because these are American corporations with foreign subsidiaries.  That‘s how they do it.  These not are not just foreign companies. 

We are saying to major American companies that you can go offshore.  You can go to India.  You can open up an office, even though you‘ve got a presence in the United States, and you can defer paying your taxes on that back to America. 

Now, why would we do that?  It‘s an odd and old tax structure that has existed for 40 years.  And what he‘s saying is, we should bring that to a halt.  And with the savings, do an overall tax—corporate tax cut, which would benefit 99 percent of the corporations. 

MATTHEWS:  Let‘s talk about transportation in this country.  A big issue with the economy.  John Kerry opposed development of ANWAR, the Alaska wilderness.  He says he wants to make America energy efficient here at home or sufficient here at home.  He doesn‘t want us depending on the Middle East. 

Where is the oil going to come from if it doesn‘t come from under the ground in Alaska and it doesn‘t come from under the ground in Arabia?  Where is the new Kerry regime going to get oil?

GRANHOLM:  I think that what he‘s talking about are increasing significantly alternative forms of energy.  Whether it is hydrogen or solar, wind.  There‘s an awful lot out there, clean coal, that we need to support, develop the technology, support those industries so that we are not so reliant on foreign oil. 

MATTHEWS:  But cars drink oil.  They use oil.  Gasoline. 

GRANHOLM:  We have—There‘s a new generation of vehicles, also, that is being proposed, either with clean diesel or with making sure that we‘ve got hybrid vehicles or hydrogen fuel cells. 

Those—All those great technologies are technologies that could be developed in the United States in the great American automobile. 

MATTHEWS:  But aren‘t the big auto companies worried about cafe standards, the fact that you‘re going to demand more efficiency from the cars?  Doesn‘t that—Doesn‘t that scare them in the near term?  Not the long term.  This pie in the sky energy alternative. 

But in the near term, if you start saying vehicles have to carry more tons per gallon, isn‘t that going to put—and in fact you‘re going to ask for more vehicles to be smaller, aren‘t you, in a sense? 

GRANHOLM:  Well, I‘m not in favor of a rigid application of cafe standards.  I think what Senator Kerry has said is that he‘s not going to do a darn thing that will cost Michigan or the automotive industry jobs, that he‘d like to see a greater fuel efficiency.  He‘d like a goal of 36 miles per gallon but he is not wedded to a particular time frame or a mechanism. 

He wants to work with the auto industry to achieve that.  And frankly, my opinion is that I think the market might get us there sooner than any regulation would anyway. 

MATTHEWS:  Is John Kerry an environmentalist?

GRANHOLM:  Yes.  He is an environmentalist. 

MATTHEWS:  Well, don‘t the auto—Doesn‘t the auto industry, the UAW and the others fear that word?

GRANHOLM:  No.  I think the auto industry is an environmentally friendly industry also.  And as we move toward hydrogen fuel cells and hybrid vehicles and clean diesel, they are all interested in making sure that they develop a product that the community, that the American people want.  And they want energy-friendly vehicles. 

MATTHEWS:  I‘ve got to ask you a personal question.  Senator Orrin Hatch, the Republican from Utah, wants to change the Constitution so a person who‘s born in a foreign country can become president after living here for just 20 years.  Do you like that idea, being someone who was born in Canada?

GRANHOLM:  Well, let me say, first I‘m not interested in it applying to me.  But I do think that we are a country of immigrants, except for Native Americans.  And if somebody‘s been here longer than the Constitution prescribes the limit—the minimum limitation for presidents, then that is certainly something that we should consider. 

MATTHEWS:  35 years. 

Anyway, thank you, Governor Jennifer Granholm.  I don‘t think you need to wait that long. 

Up next, while John Kerry spent the day campaigning in the Midwest, President Bush headed to the Southwest.  Colorado Governor Bill Owens will be here to talk about the jobs, the economy, and the battle for the White House. 

And later, fallout over whistle-blower Richard Clarke‘s testimony for the 9/11 commission continues.  Nine eleven commission member John Lehman will be here with his thoughts on the hearings.

You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  The people—the people of the country spent their own money better than the federal government could have.  And that‘s why the economy is getting stronger.  So they need to make the tax cuts permanent. 

If you‘re a businessperson, you need to be able to plan.  You don‘t want to think your taxes are going to be gone—here today and gone tomorrow. 

(END VIDEO CLIP)

MATTHEWS:  President Bush was in New Mexico and in Arizona today talking about home ownership and the economy generally.  I‘m joined right now by Colorado Governor Bill Owens, who supports President Bush for re-election. 

How good is the economy in your part of the country, Governor?

GOV. BILL OWENS, COLORADO:  I think it‘s good but it could be better. 

We‘re still pulling out of a national recession that actually started when President Clinton was in office.  We‘ve had nine straight quarters of economic growth. 

And I‘m optimistic about the future.  We‘re doing well, but we could do better. 

MATTHEWS:  Is this a jobless recovery we‘re suffering through right now?  Experiencing?

OWENS:  Well, Chris, as you know, a lot of times when we have recoveries with high productivity increases—and that‘s what we‘ve had; we‘ve had tremendous increases in productivity—The jobs actually follow the recovery. 

We‘re starting to see the jobs come into place: 350,000 in the last six months.  But I think what we‘re about to start seeing are more jobs as the recovery continues into its 10th straight quarter. 

MATTHEWS:  We‘ve lost about three million jobs since the president took office.  And of course he came in as the recession was emerging, as the stock market was dropping.  And of course, 9/11.  All those factors are relevant. 

The question to the politics right now is, do you think the president will be in a job-producing era this November?  Will it be obvious by this November?  You say it‘s a lagging indicator.  Will it appear obvious by November that the economy is back producing jobs?

OWENS:  You know, Chris, I think it will be.  Again, the last half of last year was the strongest economic growth in terms of the GNP in more than 20 years. 

Our unemployment rate at 5.6 is still too high, but it‘s actually lower than the average of the 1970s, 1980s, 1990s.  It‘s actually 0.1 percent lower than President Clinton‘s unemployment rate was at this point in his first term.

Can we do better?  Absolutely. 

Lowering the taxes, which is what President Bush has done, I believe, has been a real reason why we‘re starting to see this economy turn around.  It‘s a huge comparison, a huge difference with John Kerry. 

MATTHEWS:  Well, why is John Kerry leading in the polls on the question of who can best produce jobs?

OWENS:  Well, I think, again, it‘s that lagging perception.  I think as an economy turns around, it takes awhile for people to see it, to start to feel it on Main Street.  But I think we‘re starting to see it. 

Again, I won‘t go through all those numbers again.  But at this point in time, people are still looking at what we had a couple of years ago.  And they‘re not able yet to see some of the indicators that economists are seeing and that we‘re actually seeing in a lot of the indicators. 

MATTHEWS:  What cuts deeper...

OWENS:  Again, one of—one of the issues is going to be, who‘s going to keep the lid on taxes?  And I think that‘s going to be a defining difference between John Kerry and George Bush. 

MATTHEWS:  What cuts deeper as an issue in Colorado?  These questions we‘re been talking about or the cultural questions like gay marriage?  What cuts deeper with the voters?

OWENS:  I think the economic issues cut deepest here.  Everybody is most concerned about their own family, about how to make sure that they take care of their family‘s needs. 

There are important social issues, but I think the economy is going to be a critical issue in Colorado, as is the war on terror and who can best lead that war.  And again, that‘s a defining distinction between George Bush and John Kerry. 

MATTHEWS:  Is George W. Bush a conservative?

OWENS:  Absolutely. 

MATTHEWS:  Why then why is the deficit—why have we gone from surplus to huge deficits under his presidency?  I mean, going from huge—

I mean really big surpluses to, you know, a half a trillion dollar deficits now. 

Is that the work of a conservative president?

OWENS:  Well, it isn‘t the work of a conservative president, because it actually hasn‘t been his fault.  We‘ve had an international recession, a national recession that, as we all know, actually started through no fault of his own, under President Clinton. 

And then we saw September 11.  And September 11 caused a significant cut in our national Gross National Product.  And so we‘ve been through some challenging times. 

But that deficit, which is still small by historic standards as a percentage of the overall economy, and while we all think it‘s too large, you can‘t blame that on George W. Bush ...

MATTHEWS:  That‘s what Democrats and liberal economists said.

OWENS:  And John Kerry‘s in charge...

MATTHEWS:  For decades, liberal economists and Democrats have been covering up for big deficits by saying it‘s a smaller percentage of the economy.  You sound like a liberal. 

OWENS:  No.  Had John Kerry been president, we would have had a far greater deficit.  The Democrats‘ only critique of this president is that he cut taxes too much and that he‘s not increased spending enough. 

MATTHEWS:  Well, it‘s great having you on.

OWENS:  That would lead to more of a deficit.  Good to be here. 

MATTHEWS:  We‘ll continue this discussion later.  Governor Owens of Colorado, thanks for joining us. 

Up next, Condoleezza Rice wants to meet with the 9/11 commission.  But should she be compelled to testify under oath?  I‘ll talk about 9/11 member John Lehman.  He‘s coming here to talk about it.

And later, a HARDBALL special report—and this is a big one for us -

·         America‘s wounded sons and daughters, an intimate look at the lives of our soldiers back from Iraq and Afghanistan who are now back home recovering from their injuries.

You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  This half-hour, a HARDBALL special report on America‘s wounded sons and daughters.  You‘ll meet some brave soldiers home from the front who are fighting to live normal lives now. 

But, first, the latest headlines right now. 

(NEWS BREAK)

MATTHEWS:  Welcome back to HARDBALL.

One day after Richard Clarke charged that the Bush administration dragged its feet on the al Qaeda threat, President Bush defended his national security policy prior to 9/11 and said he didn‘t know terrorists would use airplanes as missiles. 

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  Had I known that the enemy was going to use airplane to strike America, to attack us, I would have used every resource, every asset, every power of this government to protect the American people. 

(CHEERING AND APPLAUSE)  

(END VIDEO CLIP)

MATTHEWS:  That‘s a big if. 

Former Navy Secretary John Lehman is one of the 9/11 commissioners who questioned Richard Clarke early this week. 

Welcome, Mr. Secretary. 

Do you think that‘s the case, having sat in judgment in the commission these last several days, that the United States had no notion whatever that a terrorist might use an airplane as a missile? 

JOHN LEHMAN, 9/11 COMMISSION MEMBER:  Well, I would say that there were certainly pockets of people in the government perhaps, who had read Tom Clancy‘s books and others where there were indications over the years that there were terrorists who considered using hijacked airplanes as missiles.  That definitely was the case.

But that that was a top concern briefed to the—any president by the intelligence community, we have found no evidence that that is the case.  And that‘s really the heart of this story is that the facts that we‘ve established, including much of Richard Clarke‘s testimony, has shown an intelligence community that is utterly dysfunctional. 

It does not get the information.  It does not have people where it should be.  It has certainly been improving since 9/11.  But it is still not there.  It does not get the information once it‘s processed to the right people crossed through the government.  And this is the whole purpose of the—it sounds like we‘re just trying to put blame on people when you watch the TV renditions, but, really, what our business is, is to fix the tremendous dysfunctions and failures that went wrong in two administrations. 

So it is really the whole intelligence community that is the culprit here. 

MATTHEWS:  What do you make of Richard Clarke‘s claim or assessment that he was afraid already before 9/11 that a plane would be used to attack the Olympic Games back in Atlanta and he hastily assembled an air defense system for those Games?

Let‘s take a look at what he said. 

(BEGIN VIDEO CLIP)

RICHARD CLARKE, FORMER COUNTERTERRORISM ADVISER:  As to your question about using aircraft as weapons, I was afraid, beginning in 1996, not that a Cessna would fly into the Olympics, but that any size aircraft would be put into the Olympics. 

And during my inspection of the Atlanta Olympic security arrangement a month or two before the Games, I was shocked that the FBI hadn‘t put into effect any aircraft air defense security arrangements.  So I threw together an air defense for the Atlantic Games somewhat quickly.  I got an air defense system in place. 

(END VIDEO CLIP)

MATTHEWS:  How do we square all this, as people watching this, Mr.  Secretary?  You‘ve got the president saying yesterday and Condi Rice saying a couple years ago, they didn‘t imagine the use of planes as missiles. 

Then you‘ve got Richard Clarke, who at least had the title of the top terrorist expert for the president in the White House, saying he had already been working on plans, had developed them, in fact, five years ago for use in the Olympics.

LEHMAN:  Well, I think that‘s sort of focusing on a capillary.  It‘s very true.  What Dick said is true.  He did that.  And he did that not because the bureaucracy or the FBI or CIA or Defense Department said he ought to do it, but because he worried about that threat. 

So, certainly, there were people that worried about those kinds of threats.  But a president has to worry about hundreds of different kinds of scenarios.  And so the one that they didn‘t think of happened.  But that‘s really more an indictment of the fact that we had not penetrated the planning in al Qaeda.  We had no agents within al Qaeda.  We could only guess and speculate what—how the attack would come. 

So that‘s what we have got to fix.  Certainly, we have to let the chip fall where they may as far as who did what and what went wrong.  But I don‘t think either president in the long eight years of the Clinton years or the seven months of the Bush administration are going to end up being the culprits here. 

The culprits are the bureaucracy that wasn‘t fixed over 20-plus years...

MATTHEWS:  Right. 

LEHMAN:  ... that everybody knew was dysfunctional and nobody did anything about it.  Congress did nothing about it.  Congress did—made no improvements and a lot of—put a lot of restrictions on hiring and a lot of prohibitions on covert activity. 

So there‘s plenty of blame to go around, but we can‘t be wasting a lot of time in the blame game.  We have got to get on with fixing thee things.  And that‘s what this commission is going to do. 

MATTHEWS:  Do you think the president should remove the restriction on Condoleezza Rice testifying before your commission? 

LEHMAN:  I absolutely do. 

I think this is a political blunder and miscalculation driven by the lawyers again.  Again, one of the most impressive things to me, having been out of the government so long, to come back in, is to see the tremendous growth of the role of lawyers at every level in the policy. 

(CROSSTALK)

MATTHEWS:  So you want to hear from Condi Rice, right? 

LEHMAN:  I do. 

MATTHEWS:  OK, thank you very much, former Navy Secretary John Lehman.

Coming up, our special report on America‘s wounded sons and daughters, these soldiers and our stories and their stories are unforgettable.  Don‘t miss it.  It is coming up here on HARDBALL.

You‘re watching HARDBALL on MSNBC. 

ANNOUNCER:  You‘re watching HARDBALL. 

Now it‘s time for today‘s Marriott map facts.  Which state boasts the longest city block in the world?  Stay tuned for the answer.

(COMMERCIAL BREAK)

MATTHEWS:  Coming up, they served their country and now they‘re trying to rebuild their lives.  Soldiers tell you their stories of the war and their hope for the future—when HARDBALL returns.

(COMMERCIAL BREAK)

ANNOUNCER:  In today‘s Marriott map facts, we asked you, which state boasts the longest city block in the world?  Give up?  The answer is West Virginia.  The 1500 block of Virginia Street in Charleston is considered the longest city block in the world. 

Now back to HARDBALL with Chris Matthews. 

MATTHEWS:  Welcome back to HARDBALL. 

It is typical to measure the cost of war in numbers, how much money?  How many deaths?  How long it will last?  But what about the soldiers who come back?  What about those men and women who return from war injured and have to put their lives back together? 

I visited Walter Reed Medical Center this week to talk with two such soldiers.  We discussed everything from their experiences in war, the recovery process, and the battles they fight here at home to restore their lives. 

(BEGIN VIDEOTAPE)

MATTHEWS (voice-over):  Twenty-seven-year-old retired Sergeant Chris Schneider lost his right leg in Iraq. 

RETIRED SGT. CHRIS SCHNEIDER, LOST A LEG IN IRAQ:  All told, I‘ve had 18 surgeries, 38 units of blood. 

MATTHEWS:  He and 32-year-old Staff Sergeant Roy Mitchell are in outpatient recovery at Walter Reed Army Medical Center in Washington. 

SCHNEIDER:  The best therapists, the best doctors, the best nurses in the world.  It is unfortunate that they‘ve had this much experience.  But for those of us who need it, we‘re very fortunate that they have. 

MATTHEWS (on camera):  Where were you based? 

SCHNEIDER:  We were based about 45 miles north-northeast of Baghdad. 

MATTHEWS:  Every time you went out, you left a secure area. 

SCHNEIDER:  We left a secure area.

MATTHEWS:  What was that feeling like? 

SCHNEIDER:  You know, there‘s an adrenaline rush that goes with it. 

There‘s a fear rush. 

Your brain, your mental focus goes from normal everyday activity to this super-concentrated, almost euphoric sense of, you got to catch everything.  You got to see everything, because it is not just your line on the line.  It‘s everybody else with you.  So, I mean, you sit there and you focus on—you try to focus on every blade of grass as you drive by, if there‘s grass there, to see if it moves.  Somebody might be hiding in it. 

You scan people as you drive down the road, make sure that they don‘t have odd shape under their clothes.  Every vehicle that passes by you, you‘re looking inside the vehicle to see if they have got something that could do you harm. 

MATTHEWS:  What was it like coming back at the end of a patrol, knowing you had gotten through another day?

SCHNEIDER:  You know,physically, you‘re not that bad off.  Mentally, you‘re drained.  But you get back in the gate and everything had gone smooth or, at the very least, you got everybody back, and there‘s just a sense of accomplishment, of success. 

MATTHEWS:  Did you sense anything the day you had the big accident, that that was a day like any other day? 

SCHNEIDER:  You know, I can‘t really say if we felt like it was going to be different or not.  Every day is different.  You see different stuff. 

MATTHEWS:  Were you thinking much about the role you‘re playing in this war, compared to the guys who fought in the earlier wars? 

SCHNEIDER:  Although they say that we went over for weapons of mass destruction or for whatever the reason anybody gives for us going over there, I will forever for the rest of my life believe going over there was a good thing. 

Most of the Iraqi people did not like Saddam Hussein.  Whether they followed him or not, they did—most of them did it out of fear. 

MATTHEWS (voice-over):  Staff Sergeant Mitchell lost his left leg in Afghanistan, when a homemade explosive was detonated as his convoy was on patrol. 

(on camera):  Describe a typical day over there in Afghanistan.  I know it‘s hard to figure out a typical day. 

STAFF SGT. ROY MITCHELL, LOST A LEG IN AFGHANISTAN:  Well, a typical day, well, a typical day for us changes, because each fire base has different priorities, because the one fire base where I was at when I got injured was right on the Pakistan border.  And it is a real high-profile fire base. 

MATTHEWS:  Tell me about the instinct as a soldier.  You‘re out there and you‘re going out every day.  Did you know that there was a danger out there of these improvised bomb? 

MITCHELL:  Well, yes.  Yes, there‘s always a concern with IEDs.  And that‘s, basically, when we got briefed on the enemy situation. 

(CROSSTALK)

MATTHEWS:  Improvised—what is IED? 

MITCHELL:  Improvised explosive device is what it stands for.  And, basically what it is, is anything that those guys can get, gunpowder, C-4, anything they can get. 

They‘ll take old Soviet RPG rockets.  They won‘t have the actual weapon to shoot that RPG, but what they‘ll do is, they will rig it with a remote-detonated device or something and then explode it and use it as an IED and explode it when friendlies are coming by. 

MATTHEWS:  You‘ve seen the Afghanistan part of the war.  You have watched the other part of the war.  What is your sense about the mission and what—is it a winnable thing?  Is it important?  Your own—when you‘re going to tell your kids about this, what are going to you tell them?  What is your sense of the war? 

MITCHELL:  When 9/11 happened, it was a tragedy.  It was just, you know—a lot of people say it could have been prevented.  Yes, but that‘s outside—outside my lane, you know?  But the war on terror, it is definitely a winnable—it‘s a winnable thing.  And, you know, we‘re proving that by—we caught Saddam, you know?

And a lot of people said that we weren‘t going to be able to catch him.  Bin Laden has been evading us for years now.  But we‘re tracking him down.  We‘re getting closer and closer.  So it is definitely a winnable thing. 

(END VIDEOTAPE)

MATTHEWS:  Coming up, more with my visit with Sergeants Schneider and Mitchell.  We‘ll talk about the day they lost their legs and the long healing process. 

You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.

One of the truly amazing stories of this war is how far the technology for treating wounded soldiers has progressed.  Some of the prosthetics the soldiers receive are so sensitive, the wearer would know if a pebble was under his new foot. 

Sergeant Schneider and Sergeant Mitchell talked about the day they were injured, their treatment and their hopes for the future. 

(BEGIN VIDEOTAPE)

SCHNEIDER:  It threw the other three people in my vehicle, the driver, the 50-cal gunner, who is half in the cab and half out of the cab, where he stands.  And then myself and another guy, we were in the back as machine gunnists.  It threw the other three out into the field on the right.  It threw me up over the vehicle and into the field on the left. 

MATTHEWS:  Were you conscious of any of this? 

SCHNEIDER:  I was fully conscious.  It broke my pelvis in two places. 

It broke a bone—it crushed the bone in my hip.  It tore my femoral vein and artery in my right leg.  And it crushed about three-quarters of the muscles around the outside of my right leg. 

MATTHEWS (voice-over):  Staff Sergeant Mitchell met a similar fate.  Only, his injury was a result of what‘s called an IED, an improvised explosive device, a crude homemade bomb. 

(on camera):  Tell me about what happened.  You‘re driving along and you‘re in the passenger seat up front. 

MITCHELL:  Yes, I was in the passenger seat up front.  I didn‘t hear the explosion.  The only thing I—everything just went back from all the soot and everything that went in the air. 

And then it took me about two minutes or so to realize I was alive.  I had a lot of third-degree burns happen on this leg.  And then 40 percent of the end of my stump on this leg is also a graft where there‘s a lot of burns. 

MATTHEWS (voice-over):  The soldiers were brought to Walter Reed Army Medical Center, where the majority of the military‘s prosthetic patients are treated. 

Here, Lieutenant Colonel Jeff Gamble (ph) is the chief of the amputee clinic. 

UNIDENTIFIED MALE:  There are many different type of injuries.  The focus often has been on the blast injuries.  And there are unique aspects to the blast injuries.  They‘re often contaminated injuries which, when the blast material, the fragments end up in various parts of the body in the soft tissues, they can cause infection. 

SCHNEIDER:  They tried for 12 days to save my lower leg.  And, unfortunately, the infections that I had started developing from the muscles deteriorating spread to my knee.  They spread into my upper leg.  They got into my pelvis.  And if they would have made it past my pelvis into the rest of my body, I would have probably died. 

MATTHEWS:  The hospital has treated more than 2,800 patients from the Iraqi war since its beginning.  Gamble says the high number of survivors can largely be attributed to a new body armor the military is using. 

UNIDENTIFIED MALE:  It is lightweight.  It protects the vital organs that normally would have killed people with injury in the past.  Consequently, though, the arms and legs are still exposed. 

So, with the high ordnance and the frequency of blast injuries, we‘re seeing more people with amputations or with broken bones, nerve injuries and the like. 

MATTHEWS (on camera):  You will be able to walk around and...

SCHNEIDER:  I‘ll be able to walk virtually limpless.  The primary prosthetic I‘m going to receive has a microprocessor in the knee that adjusts the hydraulic piston in it, so that they program it with a computer and it measures where in your gait it is supposed to be 25 times a second. 

(CROSSTALK)

MATTHEWS:  Wow.  Did you have any choice in this or they just said, this had to happen? 

SCHNEIDER:  They—actually, at that time, I still was not coherent. 

I was on so many pain medications. 

MATTHEWS:  You mean in January. 

SCHNEIDER:  Yes.  My wife ended up making the final decision.  And...

MATTHEWS:  It wasn‘t a tough one, huh? 

SCHNEIDER:  It was an extremely tough one for her. 

MATTHEWS (voice-over):  A major part of the recovery process for these soldiers involves deciding what they do with their future. 

MITCHELL:  I‘m trying to get into career counselling.  I‘m trying to get into the field where, you know, I‘m trying to keep good soldiers in the military.  That way, I can sit down and talk to soldiers and just say, hey, listen, it‘s a good job, but there‘s always a chance of something happening. 

But, if that does happen, you can survive.  Look at me.  Look what I‘ve had to survive. 

MATTHEWS:  Sure. 

(END VIDEOTAPE)

MATTHEWS:  Retired General Barry McCaffrey is an MSNBC analyst who was a patient himself at Walter Reed for two years after he returned from Vietnam with a shattered left arm. 

General McCaffrey, I know that brings back memories.  But I was so impressed by those guys, by their optimism.  And I got to say, if you‘re going to get hit badly and lose a limb, Walter Reed is a good place to be. 

RET. GEN. BARRY MCCAFFREY, NBC MILITARY ANALYST:  Oh, it is a national treasure, Chris, no question.  And that interview of yours was just absolutely inspirational. 

I‘ve been over there, obviously, to walk through the ward with the head nurse and see some of these young men and women.  Absolutely astonishing, their courage, their dedication, their sense of optimism.  And, fortunately, they‘re young.  What the Army will do at Brooke Army Burn Center, another big hospital, or Walter Reed or Bethesda, is put these kids back together.  A year or two of hard work, and enormous discomfort, the pain on the part of them and physical rehabilitation, it is nice to see that kind of dedication. 

MATTHEWS:  What about the fellow we talked to, Sergeant Mitchell?  He wants to stay in the service.  How tough is that for him to meet that standard to stay in when he has lost a limb? 

MCCAFFREY:  Well, first of all, I think we would be fortunate to keep him.  That kind of combat experience, his maturity, his ability to talk to soldiers as a career counselor would be just enormously valuable. 

I would be astonished if he doesn‘t stay in and do very well.  The prosthetic devices now they talked about are unbelievable.  The physical rehabilitation program is superb.  And, as they mentioned, vascular surgery, bone grafts, nerve hookups, really astonishing, skin grafting techniques.  But it is years of effort and a lot of pain on the part of those young soldiers. 

MATTHEWS:  Yes.  And young is the word, I guess, isn‘t it?  Because these fellows are in top shape when they go in to combat.  When they come out of combat, they‘re still basically great, really fit guys. 

It looks to me—I lifted up that leg, General, and I got to tell you, that was at least 20 something pounds.  And the real leg is about 18 pounds.  I was surprised it‘s that heavy.  But that seemed like a lot of weigh, especially when you have on that casing around the stump.  That seems like that is going to feel—you are going to feel that when you go to work. 

MCCAFFREY:  Oh, yes.  No, and talked to two who are badly injured.  But the bigger challenges are paraplegic, severe facial injuries, lower jaw shot off.  All that happens.  It is one of the dreadful implications of combat. 

And, fortunately, we‘re backed up by this kind of a medical system. 

MATTHEWS:  What about the body armor?  That was one of the I guess the real bad news I got out there.  Well, it is not bad.  It‘s mixed, obviously.  Guys are surviving now who would not have survived bomb blasts before because they would have shattered their organs, their vital organs.  Now they lose limbs, but they‘re still alive.  What‘s that—that‘s changing, it seems, the psychology of war. 

MCCAFFREY:  Well, thank God.  Life is precious. 

I was just down at Fort Benning with Major General Ben  Freakley, the commander down there, looking at the current systems of protecting soldiers and what they‘re trying to bring online.  The body armor is unbelievable.  It will take a direct hit from an AK-47.  The new stuff that we‘re putting out now will stop a 50-caliber round.  We‘re adding  epaulets to try and extend the coverage over the limbs.

But the big program will be Bradley Fighting Vehicles, M1-A1 tanks, and up-armored Humvee vehicles.  We got to keep the kids from getting hit at all with vehicles. 

MATTHEWS:  Do you think the military doesn‘t give enough attention to these guys who are wounded?  And I know like—well, civilians like me look at the papers and say one guy killed this weekend and figure that‘s the end of the story, when in fact, this is the rest of the story.  Guys are not just killed.  They‘re hit badly. 

MCCAFFREY:  Well, no, the military is very much—part of the compact with soldiers is, we tell you, if you get hit, no matter where you are on the face of the Earth, the medical combat aid people will be on you in a flash.  They‘ll get you back into the hospital.  We will treat you. 

The Veterans Administration another important aspect of backing up our armed forces in combat. 

MATTHEWS:  General, I saw some good people out there at Walter Reed taking care of those good people.  Anyway, thank you for joining us tonight.  You‘ve been there, General Barry McCaffrey. 

And thanks to Sergeant Schneider, Sergeant Mitchell and the great staff of Walter Reed Medical Center for letting us meet those great guys and the people taking care of them, who are also amazing people. 

Join us again Monday night at 7:00 Eastern for more HARDBALL.  Our guest will be White House whistle-blower, the biggest get in the business, Richard Clarke.  Let‘s decide if he‘s telling the truth on Monday night.

Right now, it‘s time for the “COUNTDOWN” with Keith Olbermann.

END   

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