updated 5/9/2012 12:36:59 PM ET 2012-05-09T16:36:59

Guests: Heidi Hartmann, John Harwood


RACHEL MADDOW, MSNBC HOST: I prepared for it by making you drinks
the night before. That was all me getting warmed up for "Meet the Press,"
making cocktails.

ED SCHULTZ, "THE ED SHOW" HOST: You`re a gamer. I could not have
made any show on Sunday mornings.

You got it done. It was fantastic. Lots of comments on that.
Congratulations.

MADDOW: Thank you.

SCHULTZ: In fact, I think you should do it every Sunday. I`ll take
care of the fishing. I`ll have that covered for you.

MADDOW: All right. You put me and Alex Castellanos to go out on the
road and charge some ticket price.

SCHULTZ: I think you got something there.

MADDOW: All right. Thanks, man.

SCHULTZ: You bet.

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

The list of the most common jobs for men in this country and the list
of the most common jobs for women in this country are two lists that have
very little in common, it turns out. The jobs we do in this country are
still sort of surprisingly really segregated by gender. But whether you
have an occupation that is male-dominated or you have an occupation that`s
female dominated, there`s one thing that just about every single job in
America has in common. Dudes get paid more for doing it.

If you are a driver, men get paid more. If you`re manager, men get
paid more. If you`re a janitor, men get paid for. If you`re a retail
salesperson, men get paid more. If you`re a sales rep, if you are a cook,
a chief executive, a security guard, a police officer, a customer service
representative -- in all those cases, men get paid more. In 19 of the 20
jobs that are the most common occupations for men in this country, women
lag behind what men get paid for doing that same work.

It`s also true in the most common jobs that women have in this
country. If you are a secretary, men get paid more. If you`re a teacher,
men get paid more. If you`re nurse, men get paid more. If you`re a
cashier, men get paid more.

If you`re a receptionist, a financial manager, if you wait tables,
men get paid more. Again, in 19 of the 20 jobs that are the most common
occupations for women in this country, women lag behind what men get paid
for the same work.

Overall, when you aggregate everybody working, women get paid 77
cents for every dollar that men get paid. For the same work, dudes get
paid more.

"Bloomberg News" crunched the numbers from the U.S. Census Bureau
this year. They divided the country up into 265 different occupations and
they found, surprise, no matter how you slice it, men get paid more.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Nationwide, the median salary for men is
greater than women in 99.6 percent of major occupations.

UNIDENTIFIED FEMALE: There`s only one out of 2645 major occupation
categories where the median salary of men exceeded that of men, and that
was personal care and service workers. We`re talking house sitters and
butlers, valets. And even then, it`s only 2 pennies more on the dollar, or
2 percent more that these women are making.

So, in 264 out of 265 at the major occupations, men are getting paid
more.

(END VIDEO CLIP)

MADDOW: In 264 out of 265 major occupations, men get paid more than
women do.

Republicans, it turns out, do not believe this. I did not know this
was one of those things in which conservatives and the rest of the country
have two totally different understandings about what is true. But it turns
out this is one of those things.

And figuring that out makes a bunch of stuff make sense that never
really seem to make sense before. It raises one question about the
presidential campaign moving forward. President Obama was, of course,
sworn into office on January 20th, 2009. Two days after he was sworn in,
the U.S. Senate passed a bill that the brand new president had been
advocating for on the campaign trail, had been asking Congress to pass, had
been saying he wanted to sign as president.

If you`re a woman working in a job and you`re being paid less than
man who is doing the same job, that`s illegal. That is discrimination. If
the same company is paying a men and a woman different amounts for doing
the same work and they`re paying the man more, and the woman less just
because of gender, that`s a illegal discrimination.

But how do you know it`s happening if it`s happening to you? I mean,
companies don`t volunteer that they are discriminating on the basis of
gender. And people in all sorts of different jobs don`t generally
volunteer their salaries to each other.

So, you have to know what you are being paid and you have to know
what somebody else in a comparable position to you is being paid so that
you can compare the two before you have any idea that discrimination is
going on.

If you find out you are being discriminated against and you want to
sue for that because that is illegal discrimination, it used to be that the
statute of limitations for you being able to sue would start ticking on the
date of the last discriminatory paycheck that you got.

So, there is a statute of limitations. You can`t sue somebody for
discrimination on a job that you quit 25 years ago or something. But every
time you get a new discriminatory paycheck, that statute of limitations
clock starts ticking again. In 2007, there was a court ruling that changed
that. It said, from now on, the statute of limitations start ticking with
your first discriminatory paycheck, even if you do not know it`s
discriminatory.

So, think about this, by the time you figure out you`re being
discriminated against at your job, too bad, the statute of limitations has
ran out. It`s over. You have to live with it. Ha!

I mean, discrimination is still technically illegal, but thanks to
that court ruling in 2007, essentially, now, there`s nothing you can do
about it. Nice loophole, right? That bill that the Senate passed two days
after President Obama was inaugurated that the House passed a few days
after that, a bill that was on the president`s desk nine days after he
became president, the first bill he signed as president fixed that
loophole. The Lilly Ledbetter Fair Pay Act, that`s what it did.

So, if you are being discriminated against at work, if you are
getting paid less because you are a woman, the statute limitations will not
be over by the time you can conceivably figure that out. You can actually
take an employer to court to stop the discrimination.

Straightforward as policy, right? Noncontroversial. Thirty-six
Republican senators voted against it. The only Republicans who voted for
it were the four female Republicans in the Senate and Arlen Specter, who
was about to become Democrat. That`s it. All of the other Republican
senators voted no.

On the House side, 172 Republicans voted against it. Only three
Republicans voted for this thing.

And when that happened, I`ve always thought about that vote as just
the first sign that Republicans were going to vote no on everything that
Barack Obama supported, even anodyne (ph), noncontroversial, narrowly
targeted solutions to real world problems like this.

But now we know that while women getting paid less than men is a real
world problem, in Republican world, it is not a problem. Not it`s
happening and we don`t mind, but it`s not happening.

In Republican`s minds, women don`t get paid less than men in this
country. You know, look. In one profession out of 265, women are doing
great. Butlers turns out. It`s awesome. The other 264 occupations, those
are obviously just statistical aberrations.

I honestly thought this was one of those issues where Republicans and
Democrats might disagree about how to solve the problem or Republicans
might think it`s important to oppose the president than try to solve the
problem. Before yesterday morning, I did not know that Republicans
literally do not believe this problem exists.

(BEGIN VIDEOTAPE)

DAVID GREGORY, MODERATOR, "MEET THE PRESS": How, Rachel, should this
conversation actually be framed? I made the comment when I`ve done this
topic before. In a lot of ways, you know, men bringing up this question
it`s almost a condescending question. "Well, what is it that women want?"

MADDOW: Right.

GREGORY: So what is the right way to be framing this conversation
and this debate? Which is a very serious debate, because we`re talking
about the real deciders in the race.

MADDOW: Policy. It should be about policy. And all of our best
debates are always about policy. And it should be about policy that
affects women specifically.

The Romney campaign wants to talk about women and the economy. Women
in this country still make 77 cents on the dollar for what men make. So if
--

ALEX CASTELLANOS, REPUBLICAN STRATEGIST: Not exactly.

MADDOW: Women don`t make less than men?

CASTELLANOS: Actually, if you start looking at the numbers, Rachel,
there are lots of reasons for that.

MADDOW: Wait, wait. No.

CASTELLANOS: Well, first of all, we --

MADDOW: Don`t tell me what the reasons are. Do women make less than
men for the --

(CROSSTALK)

CASTELLANOS: Actually. No, because --

MADDOW: Wow. OK.

CASTELLANOS: Well, for example, men work an average of 44 hours a
week. Women work 41 hours a week. Men go into professions like
engineering, science and math that earn more. Women want more flexibility
--

MADDOW: Listen, this is not a math is hard type of conversation.

CASTELLANOS: No, no. Yes, it is, actually.

MADDOW: No, it isn`t.

CASTELLANOS: We`re having to look--

MADDOW: No, listen--

GREGORY: All right Let Rachel, frame it though --

(CROSSTALK)

MADDOW: Right now, women are making 77 cents --

CASTELLANOS: And litigated --

MADDOW: -- on the dollar for what men are making, so --

CASTELLANOS: Well, that`s not true.

MADDOW: So --

CASTELLANOS: If so every--

GREGORY: All right, let Rachel make her point.

CASTELLANOS: -- greedy businessman in America would hire only women,
save 25 percent and be hugely profitable.

MADDOW: I feel like this is actually--

CASTELLANOS: That`s it.

MADDOW: -- and it`s weird that you`re interrupting me and not
letting me make my point, because we get along so well. So let me make my
point.

CASTELLANOS: I will.

MADDOW: But it is important, I think, the interruption is important,
I think, because now we know, at least from both of your perspectives, that
women are not faring worse than men in the economy. That women aren`t
getting paid less for equal work. I think that`s a serious basis --
difference in factual understanding of the world.

But given that, some of us believe that women are getting paid less
than men for doing the same work, there is something called the Fair Pay
Act. There was a court ruling that said the statute of limitations, if
you`re getting paid less than a men, if you`re subject to discrimination,
starts before you know that discrimination is happening, effectively
cutting off your recourse to the courts. You didn`t know you were being
discriminated against. You can`t go.

The first law passed by this administration is the Fair Pay Act -- to
remedy that court ruling. The Mitt Romney campaign put you out as a
surrogate to shore up people`s feelings about this issue after they could
not say whether or not Mitt Romney would have signed that bill. You`re
supposed to make us feel better about it. You voted against the Fair Pay
Act. It`s not about--

(CROSSTALK)

MADDOW: -- whether or not you have a female surrogate. It`s about
policy and whether or not you want to fix some of the structural
discrimination that women really do face that Republicans don`t believe is
happening.

GREGORY: It`s policy is the argument.

CASTELLANOS: It`s policy. And I love how passionate you are. I
wish you are as right about what you`re saying as you are passionate about
it. I really do.

MADDOW: That`s really condescending.

CASTELLANOS: For example-- no.

MADDOW: I mean, this is a stylistic issue.

CASTELLANOS: I`ll tell you what --

MADDOW: My passion on this issue --

CASTELLANOS: Here`s a fact --

MADDOW: -- is actually me making a factual argument--

CASTELLANOS: Can I share one- -

MADDOW: -- on it, Alex.

CASTELLANOS: May I share one fact with us?

MADDOW: Please share.

CASTELLANOS: When you look at, for example, single women working in
America today between the ages of, I think, 40 and 64, who makes more? Men
or women, on average? Men make $40,000 a year. Women make $47,000. When
you take out the marriage factor, look at some economics.

My point here is that we`re manufacturing a political crisis to get
away from what this election really wants to be about.

(END VIDEOTAPE)

MADDOW: Manufacturing a political crisis.

What I wanted to talk about there was policy, about why Republicans
would not support a common sense solution to a very specific part of the
problem of women making less than men. But on the way to trying to raise
that question, I accidentally learned, I guess we all accidentally learned
that Republicans don`t believe that women make less money than men do.
Women make less money than men do.

On average women, get paid 77 cents for every dollar that man gets
paid. That`s for everybody in the work force. If you look at the most
popular jobs among men, it`s the same thing. If you look at the most
popular job among women, it`s the same thing. There are a few outliers.
You can cherry pick, like you can with any statistical truth. But this is
a really, really clear statistical truth.

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN HOST: Here is a question. Do women in the United
States make less money than men for doing the exact same work? On NBC`s
"Meet the Press" yesterday, the Republican strategist and CNN contributor
Alex Castellanos answered no. That sparked a very passionate debate with
Rachel Maddow of MSNBC.

We asked Lisa Sylvester to do a fact job. Lisa, who`s right?

LISA SYLVESTER, CNN CORRESPONDENT: Well, this is a fascinating
subject, Wolf, and we have been looking into this. We reached out, by the
way, to Alex Castellanos but he was not available for comment.

The question, is there an earnings gap between men and women? And
the answer, according to the Census Bureau is yes.

SYLVESTER (voice-over): But data directly from the Census Bureau
shows there is a pay gap and it`s real. Quote, "In 2010, the earnings of
women who worked full-time year round were 77 percent of that for men
working full-time.

(END VIDEO CLIP)

MADDOW: Women get paid less than men do, 77 cents on the dollar on
average. That`s true. Democrats know that`s true. It`s the accepted
truth by anybody who is looking at the facts of the matter. Republicans do
in the know that`s true.

This seems important. I finally see this now. It`s important both
in terms of the facts but also in terms of the politics.

I think this is why this debate has been so talking past each other,
so incoherent and dissatisfying.

Republicans think you solve the war on women perception problem by
having your presidential candidate be seen with women. That`s Mr. Romney
on the campaign trial with Republican Senator Kelly Ayotte. She won Judd
Gregg Senate seat after he retired from the Senate two days after President
Obama was inaugurated, Judd Gregg was one of those Republicans who voted no
on the Fair Pay Act, because there is no fair pay problem, right?

When they got in trouble on this issue earlier, they put out Cathy
McMorris Rodgers as Mr. Romney`s female surrogate to shore up the way
people felt about this issue. She voted no on the Fair Pay Act.

Mr. Romney himself will not say whether he would have signed the Fair
Pay Act that President Obama signed.

Republican Governor Scott Walker of Wisconsin who Mitt Romney has
been praising as a hero, he just repealed the state-level version in
Wisconsin of the Fair Pay Act.

If you recognize that there`s a problem with women getting paid less
than men, a political party opposing or at least refusing to support policy
to fix that problem seems like hostility toward women`s interests.

But if you don`t recognize there`s a problem with women getting paid
less than men, then policy debates about how to fix something that`s not a
problem don`t seem that important to you. And so, you downplay the
importance of policy and you can`t understand why everybody keeps saying
this war on women thing is going on. And your 17-point deficit with women
voters, that`s -- that`s just the product of not putting your candidate out
there with enough women standing next to him regardless of how they vote
and what they think.

And that brings us to what`s going be a central bet in the campaign,
a central question: does the country live in Republican world? Where women
are getting paid less than men, somehow isn`t a problem. Where policy on
issues like this don`t matter because it turns out women are doing great.

While Mitt Romney was on the campaign trial with a female senator,
Kelly Ayotte, today, on the campaign trail with President Obama in New
Hampshire, in the same state, was Lilly Ledbetter, after whom the Fair Pay
Act was named.

The Democratic side is making a bet that general election voters are
not Republicans on the set of "Meet the Press." They are betting that the
average general election voter does not live in Republican world, but
rather in the reality based community where facts are useful for
understanding what problems are and policy is useful for solving those
problems.

Joining us now is Dr. Heidi Hartmann. She`s founder and president of
the Washington-based Institute for Women`s Policy Research. Dr. Hartmann
is also a research professor at George Washington University.

Dr. Hartmann, thank you very much for being here. I really
appreciate it.

DR. HEIDI HARTMANN, INSTITUTE FOR WOMEN`S POLICY RESEARCH: You`re
welcome. It`s a pleasure. Thank you.

MADDOW: I know that you at the women`s -- Institute for Women`s
Policy Research, you have done some of the most important and most highly
publicized work on this issue. Is there any way that the idea of a gender-
based disparity is something that depends on how you look at it? Is this
something other than a blunt truth about the American economy?

HARTMANN: Well, I mean, you obviously have by far the better part of
the argument. You`ve got the Census Bureau and I might mention, the Bureau
of Labor Statistics agreeing with you. Oh, also, I could mention, the U.S.
General Accountability Office.

I think what the issue is for the Republicans is that they believe
that that`s not -- no matter how big the wage gap is almost none of it is
due to discrimination. And, of course, these numbers from BLS and Census
Bureau are not really talking about discrimination. But the GAO study that
I just mentioned did. They said that even when you put everything you can
possibly think of in the regression equations, the statistical analyses to
try to make that gap go away, you can`t explain at least 20 percent of it.

Now, most other studies place the part you can`t explain as a quarter
to a half. So, a large part of the gap probably is due to discrimination.
But that seems to be what the debate is.

And, you know, when you ask can the Republicans convince women they
don`t live in the real world? Probably not, because almost every survey
that`s ever been done of working women, when you asked them about their
job, like 95 percent say my biggest problem on the job is lack of equal
pay.

MADDOW: In terms of just making it very clear, what you were talking
about there about doing a statistical regression analysis on these things,
controlling for other factors -- I spent a long time going through the
Republican side of this argument today just trying to understand how you
could look at these very blunt numbers and come up with the opposite truth.

What you`re saying basically is when you control for things like the
number of hours worked, you`re still getting a gender based pay disparity
that is not explained by working a different number of hours?

HARTMANN: Right. Exactly. I mean, Alex seemed to believe if you
put in working a different number of hours that would explain it. No, far
from it.

If you look at all workers and male and female in the economy, we
know, let`s say, during the childbearing years, about a third of women may
be working part time. So count part time. Count how much women work.

OK. I`m working part time. Only making $400 a week. Compare it to
all the men, more of whom are working full time.

You still get a wage ratio of 72 percent. So that means that that 77
percent isn`t going to move very much if you suddenly remove the people
where the men are working 44 and the women are only making 40. No. The
number of hours explains a very small part of it.

I mean, these regression analysis, they include occupation. They
include your education, number of years of experience, maybe sometimes
marital status, number of children -- just about anything you can think of.
And you cannot make the whole gap go away. So there is discrimination.

Now, those studies aren`t even in a way counting the sex segregation
that you opened your presentation with this evening. Those studies try to
hold occupation constant. You have the data up there occupation by
occupation. We have some equal occupations.

You mentioned police officers and sheriffs. Women are only like 1
percent behind there. Amazing. But you go to financial managers, they`re
26 percent behind. So, it is different within each occupation.

But maybe why women don`t go into police as much and go into nursing
more is also discrimination. So, even the exercise of trying to decide how
much of wage gap is due to discrimination and how much isn`t is -- that`s
open to interpretation.

That`s why in Canada, for example, when they talk about the wage gap
between women and men, they would use a number comparable to that 72
percent figure I gave you. They would use a number that says, well, look,
at how much difference men and women earn in the labor market. I mean, if
we believe men and women are equally competent, equally capable, also have
to live and eat and support their families, we should be wanting a society
where that gap is zero, where a man and woman are making the same amount.

MADDOW: How to get to zero seems like where -- that`s where I
thought we were on policy. Everybody agreed there was a gap, we`re trying
to get to zero, let`s fight about how we all get there, with all the
ideological biases and all the different places we come from. Instead to
be denying that the gap is there has blown by mind.

Dr. Hartmann, founder and president of the Institute for Women`s
Police Research -- thank you very much for joining us and helping us
understand this. I really appreciate it.

HARTMANN: You`re welcome.

MADDOW: All right. General Motors is alive and Osama bin Laden is
dead -- all thanks to Mitt Romney, turns out. Exactly how that is
possible, coming up.

(COMMERCIAL BREAK)

MADDOW: This is something that`s going to sound backwards, but it`s
not. The Obama administration announced for the first time today that the
CIA kills people in Pakistan with drones. We all knew this was happening
but they never said it before.

(BEGIN VIDEO CLIP)

JOHN BRENNAN, WHITE HOUSE COUNTER-TERRORISM ADVISOR: So, let me say
it as simply as I can. Yes, in full accordance with the law and in order
to prevent terrorist attacks on the United States and to save American
lives, the United States government conducts targeted strikes against
specific al Qaeda terrorists sometimes using remotely piloted aircraft
often referred to publicly as drones. And I`m here today because President
Obama has instructed us to be more open with the American people about
these efforts.

(END VIDEO CLIP)

MADDOW: More open. I mean, you already knew that we were killing
people with drones in places that were not technically at war. And the
administration knows that you know that, but they have never publicly
formally acknowledged it like this before.

In the speech today counterterrorism chief, John Brennan, argues that
drone strikes are legal. He explains the process that leads to a drone
strike and he basically says the Obama administration does not think
there`s a legal reason to pretend these aren`t happening anymore when
everyone plainly knows that they are happening.

Interestingly, John Brennan said that drone strikes are legal against
al Qaeda specifically because we`re at war with al Qaeda specifically,
which does raise the question of whether the administration thinks it would
not be legal to use drone strikes to kill some other kind of bad guy who
wasn`t in al Qaeda.

(BEGIN VIDEO CLIP)

BRENNAN: Yes, war is hell. It is awful. It involves human beings
killing of human beings, sometimes innocent civilians.

That is why we despise war. That is why we want this war against al
Qaeda to be over as soon as possible and not a moment longer. And over
time as al Qaeda fades into history and as our partners grow stronger, I do
hope that the United States would have to rely less on lethal force to keep
our country safe. Until that happens, as President Obama said here five
years ago, if another nation cannot, will not take action, we will.

(END VIDEO CLIP)

MADDOW: That announcement is not the only thing that happened that
was unexpected and a big deal and on top of other things going on in
politics and other news. This is one of those news days that is kind of an
embarrassment of riches. There`s a lot going on right now.

For example, there`s an oil spill today in Louisiana. A 22-inch
pipeline that carries oil to the nation`s third largest refinery in Baton
Rouge ruptured today. Nearly 2,000 barrels of Exxon oil were spilled.

Here is the picture of them starting to clean up the Exxon,
Louisiana, spill, today. As you can see here, not that impressive. Pretty
much the technology for cleaning up oil spills is paper towels, fancy paper
towels and hard hats.

Meanwhile the oil industry`s annual offshore drilling conference is
under way in Texas, where today they announced plans to drill the deepest
undersea well ever, 12,000 feet deep. They will be drilling into the
earth`s mantle, because we can do that now. The technology is advanced
enough for us to drill 12,000 feet deep into the mantle of the earth.

When it comes to cleaning up oil when something goes wrong, eh,
whatever, anybody got a tissue? Some 409?

Also, one other thing to keep in mind in terms of news this week,
tomorrow is May Day, which sounds like I`m calling for help but it means
May 1st -- the original Labor Day. Occupy groups nationwide are calling
for protests tomorrow to highlight the 99 percent, the needs of the non-
rich in this country.

For New York City, we`re told to expect marches and rallies and
surprise actions in disparate parts of the city as well as a reminder that
the name of New York City`s Union Square has the word "union" in it. Watch
for that in tomorrow`s news.

We`ll be right back.

(COMMERCIAL BREAK)

MADDOW: At about 2:00 in the afternoon today, something changed in
New York City. It`s a good thing. We knew it was going to happen someday,
but the fact that it happened today was a surprise and it`s a big deal, the
best new thing in the world today. It`s coming up. It turns out to be a
very fitting way to mark the one year anniversary of Osama bin Laden
becoming dead.

The best new thing in the world today, I`ll tell you what that is in
a moment. It`s still ahead.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIPS)

JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES: Thanks to President
Obama, bin Laden is dead and General Motors is alive.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: For the first time in
two decades, Osama bin Laden is not a threat to this country. Today,
General Motors is back on top as the world`s number one automaker.

BIDEN: When anybody ask you about us, Osama bin Laden is dead and
General Motors is alive.

(END VIDEO CLIP)

MADDOW: The Mitt Romney campaign tried to undermine this fairly
effective and concise argument for re-election from the Obama campaign by
saying today that Mitt Romney is actually the one who did those things. In
New Hampshire today, Mr. Romney was asked if he would have given the same
order to kill Osama bin Laden that the president gave almost one year ago,
Mr. Romney said, of course, he would have.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Even Jimmy Carter would
have given that order.

(END VIDEO CLIP)

MADDOW: Unnecessary roughness toward a totally uninvolved former
president -- yes, 10 yards.

Mr. Romney in the 2008 campaign, in fact, said he would not order a
strike into Pakistan to get Osama bin Laden the way that Barack Obama said
he would to and then did, in fact, do. Mr. Romney criticized then-
candidate Obama for saying he would do something like that. But now -- now
that the raid on bin Laden happened and was successful, Mr. Romney is
saying he would have done the exact same thing. And also neener, neener,
Jimmy Carter.

Also today, Mitt Romney`s campaign claimed credit for Obama bailing
out the auto industry.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Consider that the crown jewel, the only economic
success that President Obama has had is because he followed Mitt Romney`s
advice.

(END VIDEO CLIP)

MADDOW: You mean the Mitt Romney advice to let Detroit go bankrupt?
That advice? Is that the advice the president followed when he didn`t do
that but instead bailed Detroit out?

It`s kind of a weird day from the Romney campaign. Be prepared for
Mr. Romney to look back with glee to that unforgettable moment with the
remarks at the White House correspondents` dinner in 2011 when he stuck it
to that blow hard Donald Trump. That was hilarious, Governor Romney.
Also, when you picked Vice President Biden to be your running mate,
amazing. And good choice with Michelle.

Joining us is John Harwood, CNBC`s chief Washington correspondent and
author of "The Political Memo," political column for "The New York Times."

John, it`s great to see you. Thanks for being here.

JOHN HARWOOD, CNBC: Hey, Rachel.

MADDOW: Is it too much of a stretch to see a connection between Eric
Fehrnstrom saying the bailout was a Mitt Romney success and Mr. Romney
saying today he`d have ordered the assaults on bin Laden`s compound? Are
they going after that Obama campaign line that G.M. is alive and bin
Laden`s dead?

HARWOOD: Absolutely they are. And because both of the items of that
rather concise formulation, as you mentioned, are pretty powerful. It is
an unimpeachable fact that Osama bin Laden was gotten under President Obama
after not having been gotten under President Bush. That doesn`t mean with
the same set of circumstances that President Bush might not have made the
same decision. But you can`t take away the fact Obama did it.

So, Romney`s strategy on that part of the situation is to say, well,
any president would have done that.

On General Motors -- again, General Motors has recovered under
President Obama and so what Mitt Romney is doing is looking at the end
stage of that process which was a managed bankruptcy and saying, you see,
he did my plan. What he omits there is the fact that President Bush of his
own party and President Obama both provided cash to get General Motors to
that managed bankruptcy process. Now, the Romney campaign will argue and
say, well, without that cash, it would have happened anyway and the Obama
team, including Steve Rattner, who was essentially involved in that, say
there wasn`t a nickel of private financing available to do that.

But the strongest evidence for the fact that Obama has the high side
of this argument is the fact President Bush who was in office when Mitt
Romney wrote the editorial in "The New York Times" in November of 2008,
also decided they needed the bridge loan.

So, what you have is Romney trying to go after both ends of that
formulation. Not easy for him to pull that off.

MADDOW: One of the things that`s been I think still an open question
about this reiteration of the Romney campaign is whether or not they
acknowledge previous statements by the candidate that seem to contradict
current statements or whether they pretend those older things went away,
whether they really are trying the etch a sketch thing.

On the bin Laden thing, do they wrangle at all with the fact that Mr.
Romney was asked prospectively, would you overrule the leadership in
Pakistan or go behind their back and get bin Laden without notifying
Pakistan? He said, absolutely not, I wouldn`t do that, that would be a
horrible mistake.

Do they wrangle with that at all or they just hope that that is lost?

HARWOOD: Well, they wrangle with it a little bit because one of the
things Romney also said at the time when he was going after Barack Obama,
as Hillary Clinton was, as you recall, Rachel, was he said, well, we
shouldn`t say those things publicly. If that`s going to be our strategy,
we should keep it quiet. So, it was a mistake by an inexperienced Barack
Obama to say that out loud even if you were going to do it.

But he also said it would be going beyond the bounds to go into
Pakistan without the consent of their government.

So it`s a problematic argument for Romney to make. But, again, he`s
looking at two facts which are pretty powerful for President Obama and
trying to figure out what can I do to minimize the impact of the benefit
that the president gets and to try to undercut them?

It`s not going to be easy for him to do it. But he`s going to try.
And, then, of course, he`ll quickly get on the his other arguments about
GDP growth and unemployment rate and shortcomings of the economic facts on
the ground right now.

MADDOW: I got to say, if I were them, I would have laid low on the
bin Laden thing for a day or two given the anniversary. But it`s
interesting to watch how they handle it. John Harwood, CNBC`s chief
Washington correspondent and very good dancer -- it`s nice to see you on
Saturday night, John.

HARWOOD: Good to see you, Rachel.

MADDOW: Thank you.

All right. Right after the show on "THE LAST WORD," Lawrence
O`Donnell`s guest on the topic of equal pay for women, Lilly Ledbetter,
herself. Yes.

And here coming up, best new thing in the world. Stay with us.

(COMMERCIAL BREAK)

MADDOW: This is Pontiac, Michigan. It`s about a half hour drive
north of Detroit. General Motors used to build the cars called Pontiacs
here. They named Pontiac the car after Pontiac the city back when they
were still making them.

General Motors used to build trucks in Pontiac, too. But that`s over
now. They moved that work to Indiana.

The NFL`s Detroit Lions used to play football in the Pontiac
Silverdome. But the Lions left Pontiac in the Silverdome in 2002.

So, this is Pontiac now and frankly Pontiac is broke. In 2009, the
state took over Pontiac and installed an emergency manager whose mission
was to balance the books in that city. A few months into his tenure, the
emergency manager decided to sell the Pontiac Silverdome, sell it to a guy
from Canada.

When they built this station in the mid-1970s, the Silverdome cost
$55 million. When they sold it in 2009, the price they got for it was just
over half of $1 million. The year after they sold their Silverdome,
Pontiac got another emergency manager, a guy named Michael Stampfler.

The way Mr. Stampfler tells it, he arrived in Pontiac to find the
city hall with empty rooms and empty files. The computer is outdated. The
whole place just a mess. He says the city was unable or unwilling to
collect the money that it was rightfully owed. He says the police
department seemed to him to be corrupt.

Several months into his tenure, Michigan Republicans souped up and
made way more powerful the emergency manager law, giving managers like
Michael Stampfler, essentially unilateral control of their cities.

With the Republicans` new version of the law, an emergency manager
can rewrite contracts, can strip all power from elected officials. The
emergency manager can do anything they want pretty much without asking
anybody else.

So, in Pontiac, Michael Stampfler, studies the city finances, he
looks closely at the situation and he writes a budget letter. This from
June of last year. He says, "Property values have fallen sharply. The
property tax base is down 20 percent from the year before and people are
not paying what they do owe."

And to make matters worse, the state`s changed the law about sharing
tax money with Michigan`s towns and cities, so Pontiac is going to get 32
percent less money from that source and the town`s population has dropped
by 10 percent, which means less help from the state. Plus tax money from
the county is down 8 o percent, leaving the city on the hook for a couple
million in debt.

And you add all of this up on one side of the ledger, and it turns
out, if Pontiac, Michigan, were to lay off every single person paid out of
the city`s general fund, and as an emergency manager, you can do that, if
you fired everybody, if you eliminated the whole town payroll, Michael
Stampfler calculated that Pontiac would still be in the red. They would
still be in deficit by over $1 million, even with nobody working for the
town.

So, with all the power Michigan Republicans had given him, even with
unilateral authority to ignore the city`s founding charter and do anything
he wanted, even with the power to be a dictator in the particular American
city, Michael Stampfler found that he could not fix Pontiac`s budget.

Instead, he proposed that Pontiac give up. He proposed that Pontiac
commit municipal suicide. Pontiac should just cease to be a city, just
merge it into the county as if it were an unincorporated non-place.

That was Michael Stampfler`s tenure as a guy to whom the state gave
Pontiac, Michigan, to run as he pleased. That`s how that went.

Last year Pontiac got a new emergency manager, one who has joked
about himself as the tyrant in Pontiac. He says he thinks Pontiac is
getting better. He says he thinks the city`s troubles are just about over,
for what that`s worth.

Before this new "ha, ha, I`m the tyrant" guy became the emergency
manager in Pontiac, he used to be the emergency manager in another Michigan
city, a place called Hamtramck., He left there in 2006. He said the books
were balanced, mission accomplished, done and dusted. He took care of it.

How was Hamtramck held up since then? Well, this is the Hamtramck
newspaper today, "The Hamtramck Review," quote, "Is the city facing a
financial doomsday? Answer, yes." Quoting the acting city manager there,
"Make no mistake we are at a doomsday scenario."

If a bank or the state won`t bail them out, the manager says that
Hamtramck, Michigan, could end up with another emergency manager and that
one might decide to just kill the city, just take it right off the map.

Then there`s Ecorse. How about the city of Ecorse, Michigan? That
city was under state supervision from 1986 all the way up to the year 2000.
How did that decade of control go for fixing things in Ecorse, Michigan?
Well, now, Ecorse has got another emergency manager.

There`s the city of Flint, Michigan, the buckle of the Rust Belt.
Flint went broke a decade ago and got fixed by an emergency manager. But
after that, Flint also went broke again and now it has another emergency
manager.

Then there`s Highland Park, Michigan, a city basically inside Detroit
that spent the whole decade of the 2000s under emergency management. Heck
of a lot of good that did them. The state took over the school district in
Highland Park, too.

It has been the argument of Michigan state government that in order
to fix cities, in order to fix towns, you have to first remove the local
democracy. I mean, not just state help, state supervision but completely
unfettered control in one elected person`s hands. It`s their argument the
elected officials, the choices of the voters, that they get in the way.

For Michigan officials, democracy is part of the problem. Get rid of
democracy, they say, and then you can fix the town.

But these towns that the state taking over, the towns were the state
has uprooted the democracy, they are not fixed. Last week, a guest on our
show, the Reverend David Bullock of Detroit made a counterproposal.

(BEGIUN VIDEO CLIP)

REV. DAVID BULLOCK: If you want to help Detroit, Flint, and Benton
Harbor, Saginaw, if you want to help the cities in Michigan, let`s deal
with foreclosure. Ninety thousand foreclosures in the city of Detroit.
That`s 90,000 forced evictions in the last three years.

So if you look at 300,000 people leaving one city, you`re seeing the
tax base leave. So, this city is not in financial strain because of
mismanagement, because people are incompetent. That is not the right
analysis.

So, we have to deal with foreclosure. We`ve got to deal insurance
redlining. And so, what the state should be doing is helping to -- the
federal government, county government and state government to reinvest in
these cities. We -- Michigan is a manufacturing state, really -- really a
one-industry state.

And so, as the automotive industry, we saw manufacturing meltdown, we
saw plants go from Michigan to Mexico. That`s trade policy. This is not
incompetence.

MADDOW: But as that`s coming --

(END VIDEO CLIP)

MADDOW: Is democracy the problem? Is it just that the bad people of
Detroit are making bad choices when they vote? When they put people in
charge of running their city? Could Detroit somehow be an oasis in
Michigan, if only its elected officials had miraculously done a better job
of fending off one of the greatest industrial collapses ever seen in
Western history, followed by the worst economic crisis since the Great
Depression?

With the state now in control of its finances, Detroit is facing huge
budget cuts. The fire chief says they might have to let the empty
buildings in Detroit burn when they catch fire. So, the plan now is you
cut money for police and firefighters and just let some of the buildings
burn.

You slash city services and then what? You sit back and watch
families decide to move to your city and businesses race in to invest in a
town where there aren`t enough police, and the fire chief just says some of
the stuff, we`re just going to leave it to burn?

In recent week, Pontiac`s former emergency manager has become
something of a whistleblower about Michigan`s radical emergency manager law
-- the law that does away with your right to vote for your representatives
at the local level.

Michael Stampfler gave speech in Wyandotte, Michigan, last week in
which he said it doesn`t make sense to try to save these towns by
neutering, by rendering mute, by doing away with the means by which most
towns are supposed to work and solve their problems. He says an emergency
manager must work toward building up the social capital, building up the
democracy of the town if the town`s going to survive after an emergency
manager guy like him leaves.

(BEGIN VIDEO CLIP)

MICHAEL STAMPFLER: You turn the city back to sort of a void. They
haven`t been part of the process for all these years that they`ve been
taken over by the state. And just seems to be an awfully tough road to
hoe.

(END VIDEO CLIP)

MADDOW: After his speech last week, the Michiganders who are in the
room listening to the speech, they built up a little democracy, themselves,
by telling Michael Stampfler what they think about Michigan`s get rid of
local democracy radical law.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Abraham Lincoln, coincidentally a Republican, is
famous for saying that in America, we have government of the people, by the
people, and for the people. Does it bother you that we basically are
flushing the idea down the toilet?

UNIDENTIFIED MALE: Voters take a hit. Unions take a hit. Workers
take a hit. Democracy takes a hit. Everybody takes a hit.

But at the risk of sounding like a 99 percenter, Wall Street gets a
free ride.

UNIDENTIFIED FEMALE: What did you think our charter meant to your
job and our city?

STAMPFLER: The charter is just maybe interesting reading.

UNIDENTIFIED FEMALE: I can remember my grandfather fighting for
Mississippi for the right to vote. We believe in voting. I`ve always
voted.

And to come in and to take away people`s rights to vote and even if
you say, you know what, we do need an emergency financial manager. To come
in and not let any community people make a decision, I`m trying to figure
that out.

(END VIDEO CLIP)

MADDOW: Michigan, you may or may not like this law but you could be
stuck with it for a while.

On Thursday in Michigan, as we reported, an elections board voted to
stop an effort to repeal the law. The board split along partisan lines.
Republicans saying the font size on the petitions against the law might be
too small. They threw out the signatures of more than 200,000 Michigan
voters who signed those petitions. Enough signatures to stop the emergency
manager law right now until voters could decide on it in November.

That case, whether that law can be stopped, is now headed for court.

As Michigan`s story keeps getting bigger and I think more unsettling,
Michigan is wrangling with a deeply, deeply radical contention that we
should not necessarily govern in America using a system called democracy
anymore. In Michigan today, they are trying out getting rid of the system
by which we vote for elected officials to represent our interests to solve
our problems. Whether or not you think democracy is something we should
scrap in America, whether or not you think democracy is something we maybe
have outgrown, it should inform our debate about that, that Michigan
Republicans proposed replacement for democracy is not working in Michigan.

(COMMERCIAL BREAK)

MADDOW: Best new thing in the world today involves hardware,
specifically a pin coming loose from a shackle. It sounds like a bad
thing. In this case it`s not a bad thing. Watch.

(VIDEO CLIP PLAYS)

MADDOW: The reason for that faintly audible clapping when this
happens is when that pin comes loose from the shackle, it means this
stainless steel beam they were attached to is standing on its own, making
than beam an official permanent part of this building under construction --
and that beam standing there as part of this building under construction
makes this building the tallest building in New York City.

From 1972 until the attacks of September 11th, 2001, the Twin Towers
of the World Trade Center were the tallest buildings in New York. For 29
years, they were the tallest buildings until 9/11 brought them down. After
the Twin Towers fell from 9/11 until today, at about 2:00 p.m., what
remained as the tallest building in New York was the Empire State Building,
at the height of 1,250 feet.

But that beam you just saw -- today`s new beam makes this new
building 1,271 feet tall. Being the tallest building in a city known for
its tall buildings would be a big deal for any building, but this is
building is One World Trade Center -- the skyscraper erected next to the
footprint of the Twin Towers.

And so, today on the anniversary of the last day of Osama bin Laden`s
life on earth, today, the Empire State Building seated back to the World
Trade Center, the title of New York`s proudest building, New York`s first
face to the sky -- best new thing in the world today.

Now, it`s time for "THE LAST WORD" with Lawrence O`Donnell. Have a
great night.


END

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