'Hardball with Chris Matthews' for Thursday, July 12, 2012

Guest Host: Michael Smerconish
Guests: Richard Engel, Tyler Mathisen, Howard Fineman, Joan Walsh, Setti Warren, Patrick Murphy, Buzz Bissinger, Diane Dimond

MICHAEL SMERCONISH, GUEST HOST: Will the real outsourcer please stand
up?

Let`s play HARDBALL.

Good evening. I`m Michael Smerconish, in for Chris Matthews.

Leading off tonight: Consider the outsource. For about a month now,
Mitt Romney has been taking hits on offshore accounts, Bain Capital and
especially outsourcing. Romney`s team has now released an ad saying
President Obama isn`t telling the truth. Romney says much of Bain`s
outsourcing came after he left in 1999. But today`s "Boston Globe" may
call that into question. This is very complicated, but no matter who`s
right, this is a fight team Obama is happy to have.

Also, when you think of veterans, you probably think older and think
conservative. But the Obama team now thinks it`s got a real shot at
winning over veterans, especially younger vets from Iraq and Afghanistan.

Plus, what did Joe Paterno know and when did he know it? Now we know.
Louis Freeh`s investigation of the Penn State child abuse scandal is out
and its conclusion is plain. Paterno, among others, chose to protect Jerry
Sandusky over the children he victimized. Buzz Bissinger joins us later.

And NBC`s Richard Engel is just back from Syria with a chilling
account of what he saw in that country torn by civil war.

Finally, guess where the American Olympics uniforms were made? Here`s
a hint. Not in the USA. Cue the election year politicians.

We begin with Mitt Romney fighting back against the Bain attacks.
Howard Fineman is editorial director for the Huffington Post Media Group.
Joan Walsh is editor of Salon. Both are MSNBC political analysts.

Allow me to show you what came out today. Today, the Romney campaign
is out with this new ad accusing Obama of lying about Romney`s role at
Bain.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: When a president doesn`t tell the truth, how can
we trust him to lead? The Obama outsourcing attacks -- misleading, unfair
and untrue. There was no evidence that Mitt Romney shipped jobs overseas.
Candidate Obama lied about Hillary Clinton.

SEN. HILLARY CLINTON (D-NY), PRESIDENTIAL CANDIDATE: So shame on you,
Barack Obama!

UNIDENTIFIED MALE: But America expects more from a president.
Obama`s dishonest campaign -- another reason America has lost confidence in
Barack Obama.

(END VIDEO CLIP)

SMERCONISH: Howard Fineman, I`m tempted to say that would have been
an effective ad a week ago.

HOWARD FINEMAN, HUFFINGTON POST MEDIA GROUP, MSNBC POLITICAL ANALYST:
Yes, I think you`re right, Michael. I think the Romney campaign, which was
so good on offense during the primary season, hasn`t shown itself to be
quick off the mark in terms of defense.

The Obama campaign attacked. There are questions about exactly what
definitions you want to use of outsourcing and offshoring. There are
definitions or questions of definitions about time, the timeline and so on.

But the basic attack was well-known, and I think in its heart had a
lot to it. The Romney campaign at first dismissed it. They tried to brush
it off. They tried to make fun of it. They tried to counterattack by
saying the president sent money overseas during the stimulus package.

But it`s only today, more than a week later, that they`re trying to
react to a story that they originally sent their staff down to "The
Washington Post" to complain about. That was more than a week ago.

SMERCONISH: Joan, NBC`s "FIRST READ" had this response to the new
Romney ad. Quote, "Perhaps the biggest problem for team Romney is that
this response ad comes more than a week after the Obama camp released its
Bain outsourcing ad. That`s not quite rapid response."

Also, today, "The New York Times" reported on the disappointment among
some Romney supporters. Quote, "Mitt Romney and his team of advisers built
a reputation during the Republican primaries as tough street fighters,
skilled in the tactics of political warfare. But now Mr. Romney finds
himself confronting concern that he is not nimble and aggressive enough to
withstand the Democratic assault against him."

And then yesterday on Fox News, Mitt Romney was asked about his slow
response and said this.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R-MA), FMR. GOV., PRESIDENTIAL CANDIDATE: I, of course,
respond to the attacks that come. But you know, they say in politics, if
you`re responding, you`re losing.

(END VIDEO CLIP)

SMERCONISH: The part that surprises me, Joan Walsh, is that this was
all predictable. I mean, Newt Gingrich -- he was slapped down in
Republican quarters for doing so, but he pursued these Bain issues. Surely
the Romney campaign knew we`d get to this juncture.

JOAN WALSH, SALON.COM: Well, yes, I agree with you, Michael, except
this outsourcing/offshoring stuff is a little bit new, and they seem to be
surprised by that.

But they`ve created their own troubles in their response because it
seems to me that, first, they tried to say, Well -- they want to kind of
defend what he`s done. Then they want to say, Well, he was gone when the
outsourcing occurred, and that is what has opened the door to this big
debate now about exactly when did he leave. Did he leave in `99? Did he
leaves in 2000, 2001?

We`ve got multiple sets of disclosure forms now that each tell a
different story, one to the SEC that could be damaging about exactly when
he stepped down as CEO.

So it`s sort of like, in their original defense, they created this new
set of questions about the precise timeline of his departure. So they
really are bumbling and bungling this story from start to finish.

SMERCONISH: Here`s, Joan, what you`re referring to, a report in this
morning`s "Boston Globe" about exactly when Romney left Bain. It`s been
getting a lot of attention. It follows reporting from David Corn, as a
matter of fact, in "Mother Jones," that suggests Romney was still involved
there until 2002, three years after he says he left, during a period when
the firm invested in companies that specialized in outsourcing.

Quote, "Government documents filed by Mitt Romney and Bain Capital say
Romney remained chief executive and chairman of the firm three years beyond
the date that he said he ceded control, even creating five new investment
partnerships during that time. Public Securities and Exchange Commission
documents filed later by Bain Capital state that he remained the firm`s
sole stockholder, chairman of the board, chief executive officer and
president."

The Romney campaign said the article is inaccurate. They say Romney
was still the owner, technically, but he wasn`t involved in any investment
decisions.

And not surprisingly, however, the Obama campaign was quick to jump on
the story. In a call with reporters, senior adviser Stephanie Cutter
leveled a strong charge against Romney. Let`s listen to that.

(BEGIN AUDIO CLIP)

STEPHANIE CUTTER, OBAMA DEPUTY CAMPAIGN MANAGER: Either Mitt Romney,
through his own words and his own signature, was misrepresenting his
position at Bain to the SEC, which is a felony, or he was misrepresenting
his position at Bain to the American people to avoid responsibility for
some of the consequences of his investments.

And if that`s the case, if he was lying to the American people, then
that`s a real character and trust issue that the American people need to
take very seriously.

(END AUDIO CLIP)

SMERCONISH: Pretty strong words. Romney campaign manager Matt Rhodes
(ph) called Cutter`s statement reckless and unsubstantiated accused the
Obama camp of hitting a new low. He called on the president to apologize.

Howard, as I said at the outset, it gets confusing. I think this is
the big picture. The president got a disappointing jobs number recently,
and yet it seems like it`s Romney who`s on the defensive.

FINEMAN: There`s no question about it. And every day that goes by,
Michael, where the media -- and I`m talking about most of the media -- is -
- and the political community -- is focused on these kinds of question
about what Mitt Romney did when with Bain is one day that that same media
establishment is not talking about the rather dismal state of the economy.

So on that basis alone, it`s a win for -- tactically, for the
president. And I also think there are other streams of documents and
information that may be coming forth that may tell yet another picture of
what Mitt Romney was doing between 1999 and 2002.

The problem that Mitt Romney has is that his identity seemed to change
depending upon which document he was filling out, whether it`s an SEC form
or something else.

Don`t forget, at the time, there were also questions about -- the
later on, in 2002, when he ran for governor of Massachusetts, there were
questions about whether he was a legal resident in Massachusetts. And
actually, at that time, he had an interest in talking about how much he was
in Massachusetts and how involved he was in businesses in Massachusetts.
So I would watch for that as the next turn of the wheel in this story.

SMERCONISH: And Joan, I guess, to state the obvious, a reason why
this is significant is that the Romney campaign would like to establish a
definite end date so that Bain activities that came thereafter are not
subject to criticism in the campaign context.

KB Toys, as a matter of fact, is one of those that will often become
campaign fodder. And the question becomes, Well, did Mitt Romney have
anything to do with it, or was he already now managing the Olympics?

WALSH: Exactly. But you know, I think Bain is going to wind up
having to answer some questions here, too, Michael, because, really, the
question is, are they representing -- what are they representing to the
SEC? What are they representing to their clients?

You know, we all know that in investment companies, it really matters
who the CEO is, who`s making the decisions. How was Mitt Romney`s name and
role being used in outreach to clients?

There are a lot of questions on the corporate side, I would think, in
terms of how you represent yourself to the SEC, and then there are big
questions for Mitt Romney on the political side.

So this story that -- every day, the new sets of information that they
bring out about it -- they aren`t helping themselves, so it`s not going
away.

SMERCONISH: You know, what`s interesting to me is that the Romney
campaign has drawn some modicum of support from the fact-checking
community.

I`m referring by way of example to the fact that "The Washington
Post," although in the news pages, came out with that very important
outsourcing story, which the Romney campaign objected to, wanted a
retraction and did not get it, and yet it`s the same "Post" shortly there
before that gave four Pinocchios to an Obama campaign ad that raised this
whole issue. And yet still, they haven`t been able to turn this issue
around -- "they "meaning the Romney campaign.

Howard, do you understand what I`m saying?

FINEMAN: Yes, I do understand what you`re saying, and I think it`s
largely for the reason that Joan pointed out, is that in their effort to
nail that down, they have made some assertions about what Mitt Romney was
doing between 1999 and 2002 that are open to question. So in an effort to
shut down one part of the story, they rather stupidly opened up a whole
other one that they probably didn`t need to do.

If they`d just stuck with jamming "The Washington Post`s" own fact-
checking and review devices back at "The Washington Post," they may have
had a better time with this story.

But by the way, I think in addition to changing the subject, the
strategy here for the Obama campaign is also ultimately to get back to
taxes, I think. What they really want to do is say, Look, what was Mitt
Romney up to when? What business deals was he doing when? We need to see
more of his tax returns.

That`s the other part of this that they`re pressing on. They`re
trying to create the idea that Mitt Romney is a guy with a lot to hide
about his business life, which again is part of the larger narrative that
they`re pushing that Mitt Romney can`t be trusted because we don`t -- he
won`t tell us what he did with his business and with his fortune.

SMERCONISH: Almost Swift-Boating, of sorts, meaning go after the
asset that you perceive your opponent to have.

Howard Fineman, thank you very much. Joan Walsh, we appreciate it, as
always.

WALSH: Thanks, Michael.

SMERCONISH: Coming up: The investigation into the Penn State child
abuse scandal is out, and it`s a damning indictment of university
officials, including legendary head coach Joe Paterno, who the report says
protected Jerry Sandusky over the children he preyed upon. Buzz Bissinger
joins us in a moment.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

SMERCONISH: We`ve got some new poll numbers in the presidential race.
Let`s check the HARDBALL "Scoreboard" first.

A new Pew poll shows that President Obama has a 7-point lead over Mitt
Romney among registered voters, 50 to 43. Now to a couple of key swing
states. In Wisconsin, a new Marquette University poll shows the president
leads Romney by 8, 51 to 43. Similar story in Pennsylvania, where the
president leads 47 to 40 a new automated We Ask America poll.

We`ll be right back.

(COMMERCIAL BREAK)

SMERCONISH: Welcome back to HARDBALL. Following eight months of
investigations that encompassed over 340 interviews and 3.5 million
documents, former FBI director Louis Freeh today revealed a devastating
look at the Penn State response to the Jerry Sandusky sex abuse scandal.

According to the report, the late football coach Joe Paterno and other
top university officials, including then president Graham Spanier, vice
president Gary Schultz and athletic director Tim Curley chose to protect
the image of Penn State over the welfare of the victims, beginning in 1998.

Here was Judge Freeh this morning in announcing his findings.

(BEGIN VIDEO CLIP)

LOUIS FREEH, FORMER FBI DIRECTOR: Our most saddening and sobering
finding is the total disregard for the safety and welfare of Sandusky`s
child victims by the most senior leaders at Penn State. The most powerful
men at Penn State failed to take any steps for 14 years to protect the
children who Sandusky victimized.

Mr. Spanier, Shultz, Paterno and Curley never demonstrated through
actions or words any concern for the safety and wellbeing of Sandusky`s
victims until after Sandusky`s arrest.

(END VIDEO CLIP)

SMERCONISH: Diane Dimond is a reporter for the DailyBeast, where Buzz
Bissinger is a columnist. Buzz is also a talk show host on WPTH 1210 AM in
Philadelphia.

Buzz, I want to show you something. When Paterno was questioned by
the grand jury in 2011 about that shower assault witnessed by Mike
McQueary, here`s what he was asked.

"Other than the incident that Mike McQueary reported to you, do you
know in any way, through rumor, direct knowledge or any other fashion of
any other inappropriate sexual conduct by Jerry Sandusky with young boys?"

Paterno`s answer, "I do not know of anything else that Jerry would be
involved in of that nature, no. I do not know of it. You did mention -- I
think you said something about a rumor. It may have been discussed in my
presence, something else about somebody. I don`t know. I don`t remember.
And I could not honestly say that I heard a rumor."

All right, now I`m putting on the screen exhibit 2E to Judge Freeh`s
report. And what you`re looking at an e-mail from Curley to Schultz,
5/13/98. And what does it say? "Anything new in this department?" --
"this department" meaning the 1998 investigation. "Coach is anxious to
know where it stands."

Connect those two dots, Buzz Bissinger.

BUZZ BISSINGER, RADIO TALK SHOW HOST, DAILYBEAST: Michael, as you
know, I`ve been writing about this in the DailyBeast. I`ve been saying
this for over a year. Joe Paterno knew everything that went on involving
football. But now we know. We don`t have to speculate. We don`t have to
rant. He knew about the 1998 incident, the first alleged incident
involving Jerry Sandusky. He knew about the 2001 incident involving Coach
Paterno way beyond McQueary. He got involved in it.

He has no legacy. It is clear that Paterno wanted to keep this in-
house, and they tried and the president tried and the vice president tried
and the athletic director tried, and they didn`t want to do damage to the
football program. And finally, they got caught.

SMERCONISH: Here`s more of Freeh`s presser this morning explaining
what his findings showed about Joe Paterno`s role dating back as early as
1998.

(BEGIN VIDEO CLIP)

FREEH: The evidence shows that Mr. Paterno was made aware of the 1998
investigation of Sandusky, followed it closely, but failed to take action,
even though Sandusky had been a key member of his coaching staff for about
30 years and had an office just steps away from Mr. Paterno.

At the very least, Mr. Paterno could have alerted the entire football
staff in order to prevent Sandusky from bringing another child into the
Lasch (ph) building.

(END VIDEO CLIP)

SMERCONISH: Diane Dimond, it`s what we always suspected, is it not,
that a small circle of individuals knew this guy was a bad seed. I still
maintain that they give him a graceful exit in 1999 when he was in his mid-
50s.

DIANE DIMOND, DAILYBEAST: Oh, yes.

SMERCONISH: Victims be damned. It was all about protecting the
integrity of that football program.

DIMOND: And the institution as a whole, I think. I really urge
everybody, go to the DailyBeast. We have this whole report up on line.
Take a little bit of time and read it.

I tell you what, Michael. You and I have talked a lot about this
case. But I read this today and I just shook my head and I said to myself,
They`re all liars. Every one of them lied, not only to themselves and the
public and the campus, but they went before a grand jury and they bald-
faced lied.

They knew in 1998 that Jerry Sandusky had a problem with boys, and for
14 years -- can I repeat that? -- 14 years they let him have his way not
only as a coach with a lot of athletes there at Penn State, but bringing in
these Second Mile kids by the dozens. It just turns my stomach.

SMERCONISH: And, Buzz, when you now know that these e-mails evidence
Paterno`s awareness in 1998, when you know that, and rewind the clock and
you say, OK, McQueary comes to the house on presumably a Saturday morning
to report what he has seen in the shower, it`s just been three years since
Paterno was in the loop on Sandusky having been investigated for that,
that`s the moment -- if not in `98, that`s the moment that the hammer
should have been put down.

And instead, the Paterno response was, I`m not going to react
immediately because it`s the weekend. I don`t want to interrupt a person`s
weekend.

I`m sure you remember that.

BISSINGER: Of course.

The hammer should have been put down in 1998. The hammer simply was
not put down. They went out of their way. Forget about abuse of kids.
They went out of their way to probably give Jerry Sandusky the biggest
sweetheart retirement deal in the history of Penn State, an unprecedented
lump-sum pension plan, emeritus status, paid for 57 trips.

They cared more about this sexual animal than they ever did, ever did
about any of these kids. And let`s face it. Joe Paterno was a bad man.

SMERCONISH: Diane, Buzz is making reference to the fact that I think
Judge Freeh said $168,000.

DIMOND: Well, $168,000, right.

SMERCONISH: Unprecedented payment was made to Sandusky at the time.
And there was also a land transfer.

In other words, it`s not as if he went quietly into that night. He
had carte blanche at the university, emeritus status, could bring all the
campus that he desired.

DIMOND: Right.

SMERCONISH: They had zero of a definable response.

Let me show you this. The family of the late Joe Paterno released a
statement today saying Paterno didn`t know Sandusky was a predator.

DIMOND: Oh, stop it.

SMERCONISH: Then it goes on to say in part -- quote -- "It can be
argued that Joe Paterno should have gone further. He should have pushed
his superiors to see that they were doing their jobs. We accept this
criticism. At the same time, Joe Paterno and everyone else knew that
Sandusky had been repeatedly investigated by authorities who approved his
multiple adoptions and foster children. Joe Paterno mistakenly believed
that investigators, law enforcement officials, university leaders and
others would properly and fully investigate any issue and proceed as the
facts dictated. This didn`t happen and everyone shares the
responsibility."

Diane Dimond, major damage control from the Paterno family.

DIMOND: Oh, yes.

Well, you know, if I was their P.R. person, I would tell them to keep
their mouth shut. They just need to go quietly to their computer, The
Daily Beast, read this. And they should be ashamed of some of the things
they have said.

Joe Paterno did not know he was a pedophile? That`s remarkable
because even as far back as 1995, the biological mother of Matt Sandusky,
who has recently come out and said he, too, was a victim, Matt Sandusky`s
mother in 1995 was screaming and yelling, Jerry Sandusky is trying to steal
my son. Please, somebody, stop him. I think it`s an inappropriate
relationship.

I have spent time in State College and thereabout. It`s a small
community. You can`t tell me that Joe Paterno hadn`t heard that, too.

SMERCONISH: Hey, Buzz, it occurs to me we still haven`t heard from
Lynne Abraham. She`s investigating the Second Mile.

And on a subject I`m going to address here at the end of the program
tonight, I still want to know why did it take three full years from the
time the victim who came forward who was believed and started this
prosecution until the time they put handcuffs on Sandusky. I guess my
point, Buzz Bissinger, is there`s still much more to come.

BISSINGER: Of course.

There`s a lot more to come. Why did it take three years? It took
three years because of politics, because Tom Corbett was the attorney
general and he was running for governor, and he didn`t want to alienate the
Penn State contribution base. We all know that.

That to me is not speculation. Every speculation that concerned
people have had about this has come true. Joe Paterno did not care less
that Jerry Sandusky was a pedophile or alleged pedophile. Joe Paterno, all
his life, and the Penn State Brass cared about one thing, that goddamned
football team.

SMERCONISH: Thank you, Buzz Bissinger.

Thank you, Diane Dimond.

We will be back after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP, "THE TONIGHT SHOW WITH JAY LENO")

JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": Mitt Romney
addressed the NAACP this week. Hey, what was with the weird organ music?
Did you see that?

UNIDENTIFIED MALE: Please welcome the Honorable Mitt Romney this
morning.

(ORGAN MUSIC PLAYING)

LENO: That was the real music they played, but here`s the interesting
part. Whenever he talked about himself being president, did you see what
happened?

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Any policy that lifts up and
honors the family is going to be good for the country, and that must be our
goal.

As president, I will promote strong...

(ORGAN MUSIC PLAYING)

(LAUGHTER)

LENO: Pan over. Look who`s playing. Look, look.

(LAUGHTER)

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

SMERCONISH: Back to HARDBALL. This is the "Sideshow."

We`re just weeks away from the opening ceremony of the Summer Olympics
in London, and there`s some unexpected buzz about team USA, not about the
athletes themselves, but the team uniforms for the opening ceremony.
Apparently, the uniforms designed by Ralph Lauren are made in China, not
the U.S.

In addition to blasting a letter out to the U.S. Olympics Committee,
some members of Congress expressed their outrage today.

(BEGIN VIDEO CLIP)

REP. STEVE ISRAEL (D), NEW YORK: Today, there are 600,000 vacant
manufacturing jobs in this country, and the Olympic Committee is
outsourcing the manufacturing of uniforms to China? That`s not just
outrageous. It`s just plain dumb.

And I`m calling on the Olympic Committee to reverse this decision and
make sure that American athletes competing in the Olympics are competing
with labels that say, "Made in America."

SEN. HARRY REID (D-NV), MAJORITY LEADER: I think they should take the
uniforms, put them in a big pile and burn them and start all over again.
All -- if they have to wear nothing but a singlet that says "USA" on it
painted by hand, that`s what they should wear.

We have people in the textile industry who are desperate for jobs.

(END VIDEO CLIP)

SMERCONISH: The U.S. Olympics Committee released a statement saying
in part -- quote -- "We`re proud of our partnership with Ralph Lauren, an
iconic American company, and excited to watch America`s finest athletes
compete at the upcoming Games in London."

Reed and Israel are not alone in calling for a complete redo of the
uniforms. Can you tell it`s an election year?

Next, bring on the Photoshop. Colorado Republican Lang Sias is making
a run at the state senate after losing a congressional primary race back in
2010. Now, check out the campaign photo from 2010. Notice the "Tea Party
Endorsed" paper posted on that sign. And here Sias in front of the sign.
Well, Sias is using that same picture as a campaign mailer, just like he
did in 2010, but with one notable omission, no more nod to the Tea Party at
the forefront of the picture.

Why did he do it? Well, in the last go-around, the candidate was in a
GOP primary. This time, it`s a face-off with a Democrat in a district
that`s pretty evenly split between their two parties.

Finally, Jane Pitt, the mother of Hollywood A-lister, Brad Pitt, drew
some attention of her own last week when she sent a letter to a local
Missouri newspaper blasting President Obama for supporting gay marriage,
among other things. Her son Brad has a vocal supporter of gay marriage.

But now the plot thickens. Who`s come out in support of Ms. Pitt`s
letter? Actor Jon Voight, saying, "Good for her." Not only is Voight a
high-profile actor, but he`s the father of Angelina Jolie, Brad Pitt`s
soon-to-be-wife. She`s also come out in favor of gay marriage.

I guess it`s a good thing that Thanksgiving dinner isn`t just around
the corner.

Up next: The Obama campaign thinks it has a good chance of winning a
traditionally conservative group of voters, veterans, especially younger
veterans who served in Iraq and Afghanistan.

By the way, if you want to follow me on Twitter, you just have to
learn how to spell Smerconish. I can`t even say Smerconish.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

TYLER MATHISEN, CNBC CORRESPONDENT: I`m Tyler Mathisen with your CNBC
"Market Wrap."

It was a yo-yo of a day today, the Dow ending down 31, the S&P
dropping six and the Nasdaq lost 22, but, man, it was a lot worse earlier
in the day, the markets moving up and then down at the end again.
Investors shrugging off a positive jobless claims report. Filings fell by
26,000 last week, lowest level in four years in that metric.

The billionaire investor Warren Buffett said earlier on CNBC that U.S.
growth is pretty much flat and that the U.S. housing market is slowly
improving.

Merck a big winner today, gaining more than 4 percent on optimism
about its new osteoporosis drug.

That`s it from CNBC, first in business worldwide -- now back to
HARDBALL.

SMERCONISH: Welcome back to HARDBALL.

Military veterans by and large tend to lean Republican. In 2008, they
went for John McCain by 10 points. Four years earlier, they gave Bush a
16-point edge and polls show that Romney retains a strong lead among vets
this year.

Nevertheless, as Politico reported this week, President Obama is
making a push to win the group over, especially younger veterans of the
Iraq and Afghan wars. His pitch is that he`s pushed policies to help vets
find jobs, like giving tax credits to businesses that hire them.

He also brought the troops home from Iraq and extended benefits of the
G.I. Bill to Afghanistan and Iraq vets.

So, does the president have a shot at making strides with young vets?

Patrick Murphy is a former congressman from Pennsylvania. Setti
Warren is the mayor of Newton, Massachusetts. And both are Iraq war
veterans.

Mayor, why, in spite of the poll numbers, do you think there`s ground
here to be made up by President Obama?

SETTI WARREN (D), MAYOR OF NEWTON, MASSACHUSETTS: Well, this
president has done an outstanding job in his commitment to veterans.

As you mentioned, as -- the tax cuts that he`s offered to encourage
businesses to hire veterans, the challenge he made last summer in 2011 too
for private sector to hire veterans has resulted in 60,000 jobs for
veterans and military families. He`s extended the G.I. Bill for veterans
of the Iraq and Afghanistan war, historic measures in place where veterans
can take advantage of in-state college tuition for free.

This is a president who understands the commitment that`s been made by
those in uniform that have come home, and the fact we have to make sure
that there is a ladder for them when they do get home. And there are real
results there.

I think, as veterans learn this president`s record, they will be in
support of President Obama this fall.

SMERCONISH: Patrick, one thing the president might have going for
him, unemployment has been decreasing among vets. It stands at 9.5 percent
now. That`s down from 13.5 last year. How important will the job issue be
to veterans in particular?

PATRICK MURPHY (D), FORMER U.S. CONGRESSMAN: Oh, it`s very important.

And I think that`s why you`re seeing it decreased, which is great
news, but there`s a lot more work to be done. And like Setti said, my
fellow Iraq war veteran, although he was in the Navy, and I`m an Army guy,
but...

(CROSSTALK)

WARREN: That`s OK.

(LAUGHTER)

MURPHY: ... when you look at issues -- when you look at issue like
Hire Our Heroes, which is an initiative that President Obama is doing in
partnership with the Chamber of Commerce, and what Mrs. Obama and Dr. Jill
Biden are doing with the Joint Forces Network. They`re making sure these
heroes are hired.

But, Michael, if I could say three quick things on why there`s a very
good chance that President Obama will win the veterans vote. Number one,
Mitt Romney is no John McCain. John McCain is an American hero, served his
country and was wounded as a POW in Vietnam. Mitt Romney was in France
during Vietnam.

Number two, Barack Obama has been an outstanding commander in chief.
As you know, Michael, Barack Obama as a candidate said he will bring bin
Laden to justice if he has a chance. He did exactly that, with the help of
those Navy SEALs. And he said he would bring the troops home from Iraq,
which he`s done.

And, thirdly and finally, he`s been a true champion for our veterans,
the largest increase in veterans benefits in the history of our nation, the
new G.I. Bill, veterans centers all over our country, including two in
Pennsylvania, one in Bucks County, one in Montgomery County.

SMERCONISH: OK, but, Patrick...

(CROSSTALK)

SMERCONISH: ... I have to -- I have to interrupt and ask, then, why
is he trailing, he the president, by 24 points?

MURPHY: Well, two things.

One, traditionally, it s tough for a Democrat to win, but don`t
mistake the fact that, of the younger veterans, those 60 and under, they
voted for Barack Obama over John McCain. And Mitt Romney`s no John McCain.

SMERCONISH: So you`re saying it`s a generational issue.

(CROSSTALK)

MURPHY: ... will continue to trend...

SMERCONISH: You think it`s a generational issue.

(CROSSTALK)

WARREN: There`s no doubt it`s a generational issue, Michael, but do
not -- do not discount the fact that, as Setti said, the more these
veterans look at what the commander in chief, Barack Obama, has done for
them, the more they will continue to go in his column and eventually vote
for him this November.

SMERCONISH: Setti, let me -- let me ask you this about very quickly,
if I might. How does the don`t ask, don`t tell position of the president
play in military quarters? Help or hurt him?

WARREN: I think it helps.

I mean, look, I think that people that serve this country in uniform
understand fairness. They understand everyone`s commitment to serve, no
matter who they are. I think it`s a huge plus.

And I want to add to what my friend and colleague said, Patrick,
look, you have to look at the record. Mitt Romney in Massachusetts -- I`m
a Massachusetts native -- attempted to decrease veterans benefits by 11
percent, when he was governor. He did not in the last few month make a
commitment to continue the HUD program. In fact, he proposed eliminating
HUD.

(CROSSTALK)

WARREN: We`ve decreased homelessness by 12 percent because of the
work of the V.A. and HUD together.

SMERCONISH: I get it. Both of you think the president`s got a
record that ought to distinguish him with vets. And I hear you on those
points.

Allow me to make a tough transition because I while you`re here, I
want to make a sharp turn to something that doesn`t have anything to do
with politics. It`s a very issue -- of suicides in the military. I`m sure
you`ve seen "Time" magazine`s cover story this week. It talks about the
alarming trend, more U.S. army personnel have died by suicide since the war
in Afghanistan began than have died fighting there.

The rate jumped 80 percent from 2004 to 2008. And while it leveled
off in 2010 and 2011, it has soared 18 percent this year. Suicide has
passed road accidents as the leading non-combat cause of death among U.S.
troops. While it`s hard to come by historical data on military suicides,
the Army`s been keeping statistics only since is early `80s, there`s no
denying that the current numbers constitute a crisis.

Patrick Murphy, what took me by surprise, one-third of suicides among
troops have never deployed. In other words, you would think this is
because individuals are deployed four or five times. A third of them are
from troops never deployed. What`s going on?

PATRICK MURPHY (D), FMR. PA CONGRESSMAN: There`s such an incredible
burden on our heroes serving our country, Michael. If anyone`s watching,
they got to read that cover story in "Time" magazine. It will break your
heart.

And when you read that story, when you hear the story of someone like
Ian Morrison, who is a West Point graduate, an Apache pilot, who went six
times -- six times -- and was turned away for help. I mean, my heart goes
out to his wife, Rebecca.

I will tell you that when our family goes to bed tonight and Maggie
Murphy and Jack say their prayers of baby Jesus, we are going to be praying
for her and every one of these hero`s families, who took their life. Every
80 minutes, Michael, a veteran in America commits suicide.

It`s a national shame. There is so much more we need to do.

SMERCONISH: Setti, what is it that we need to know about this? What
drives this? What`s the cause from your perspective?

WARREN: Well, I think that clearly, it`s a tragedy. As a mayor, I
see veterans that come in my door every day. I see what they`ve gone
through, some of them, and not really having a safety net to catch them
before they fall through the cracks.

At the local level, we have to find an innovative ways to reach out
to veterans of all wars. Patrick noted that the extended deployments,
those that carry the burden, the uniform, are so great right now.

We also see that the president addressed the processing of benefits
in adding 2,300 processors at the V.A., which is very important, that
helped people get benefits that are suffering from --

(CROSSTALK)

SMERCONISH: We clearly need -- we need to do more.

Thank you both for your service.

(CROSSTALK)

WARREN: -- reaching out at the municipal level.

SMERCONISH: Thank you, Patrick Murphy. Thank you, Seth Warren.

MURPHY: Thanks, Michael.

WARREN: Thank you.

SMERCONISH: Up next, NBC`s Richard Engel just back from covering the
uprising in Syria. Can anything be done to stop the violence?

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

SMERCONISH: New poll numbers from some key Senate races and for
that, we check the HARDBALL scoreboard.

In Virginia, Democrat Tim Kaine has a two-point lead over Republican
George Allen, in the new PPP poll. Remember, that`s an automated poll that
tends to favor Democrats.

In Wisconsin, former Governor Tommy Thompson leads Democrat Tammy
Baldwin, 45-41, in a new Marquette University poll. That`s for the seat
for retiring Democratic Senator Herb Kohl.

And in Maine, independent Angus King still leads the pack in a new
Critical Insights poll. It`s King with a whopping 28-point lead over the
Republican and Democrat in the race. King still hasn`t said which party
he`d caucus with if he wins.

We`ll be right back.

(COMMERCIAL BREAK)

SMERCONISH: We`re back.

Sixteen months of fighting has left Syria war torn, U.N. peacekeeping
efforts frustrated and Syrians asking, why doesn`t the world care?
Conservative estimates by "Reuters" say that 13,000 armed and unarmed
opponents of Assad have been killed, along with 4,300 pro-Assad security
forces.

NBC`s chief foreign correspondent Richard Engel recently returned
from Syria where he witnessed the aftermath of a December 2011 massacre
that left 127 dead. In a rare interview, he asked two cousins who had
defected from the Syrian army what happened when Syrian troops rolled into
town.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE (through translator): They started firing on us
with all kinds of weapons.

RICHARD ENGEL, NBC NEWS CHIEF FOREIGN CORRESPONDENT (voice-over):
Firing from above, I asked.

UNIDENTIFIED MALE: Yes, from above. We are surrounded from every
side. There was no escape.

ENGEL: Some tried to surrender to government forces.

UNIDENTIFIED MALE: About 15 people give themselves up. The troops
tied their hands, lined them up and killed them.

ENGEL: This cell phone video shows bodies on the floor. Some appear
to be bound, shot execution style.

Ben Hassan (ph) and Radwan (ph) say Syrian troops climbed down into
the valley to finish off any survivors.

(END VIDEO CLIP)

SMERCONISH: Richard Engel is joining me right now.

Richard, thank you for being here.

How common are massacres like that which you`ve just reported on?

ENGEL: Well, I can give you the latest example. Another massacre
has reportedly happened today according to Syrian activists, 100 people
were killed around Hama when a village in the Hama area was attacked by
artillery shells and the Shabiha, which is an informal government-backed
militia entered this village and started killing people. That was a
massacre just today of 100.

And so, unfortunately, massacres in Syria are not that uncommon. The
story we`re doing tonight on "Nightly News" is something that is fairly
uncommon, however. And that is to be able to document a massacre.

Not many journalists are in Syria. We went to the massacre site. We
spoke with those two people you saw on camera. They were the only two
survivors who are still in Syria of that massacre of 127 men and boys.

SMERCONISH: I saw your recent "Nightly" report and took note of the
rudimentary nature of the weapons being used by the rebels.

ENGEL: The rebels have very little. They are fighting against an
organized army -- an organized army that is getting fractured by the day, I
must add, with some AK-47s, some RPGs, homemade explosives.

This is not like what happened in Libya where there was a massive
NATO intervention. Here, the rebels are cut off and trying to fend for
themselves. In that video, you see people changing batteries to use for
homemade bombs blowing up government vehicles. So they are trying to do it
themselves.

SMERCONISH: Is the momentum on the side of the rebels?

ENGEL: I think it is. And that is what`s new. And that is what
we`re going to be talking about tonight again on "Rock Center", and that
for the first time in this 16-month conflict, the rebels have a safe haven.
They have momentum, they have territory. They don`t have a lot of money,
they don`t have a lot of weapons, they have a lot of will, and that will
combine with a space on the ground that they can control, gives them
momentum, and I think could be at a tipping point in this conflict.

SMERCONISH: What is the current U.S. role in Syria?

ENGEL: There really isn`t one. The U.S. is trying to get Russia --
primarily Russia and to a degree China to stop putting obstacles in the way
of allowing the opposition in Syria to have more arms, more political
support, more financial support.

But on the ground, the U.S. is not doing very much at all. As the
rebels are communicating with each other, there`s no real advisers. Maybe
there`s some CIA on the ground, but U.S. role is mostly political at this
stage.

SMERCONISH: We have just a minute left. I was surprised in reading
a "Newsweek" piece that described life in the city versus life outside --

ENGEL: Life in Damascus.

SMERCONISH: Life in Damascus, pardon me.

ENGEL: Yes.

SMERCONISH: Where they`re parting like it`s, I don`t know, 1980-who
knows what? Crazy.

ENGEL: Damascus is a bubble now. The cities are still in Assad`s
hands, the government of President Bashar al Assad, particularly Damascus,
the seat of power. But the countryside is not. And the spaces in between
Syrian army checkpoints are not in government hands.

So, yes, it`s almost like that moment in the Titanic, the ship is
going down in the capital and on the bridge, they are still celebrating and
having parties, and lavish weddings.

SMERCONISH: Richard Engel, it`s nice to have you here. Thank you.

ENGEL: Thanks,

SMERCONISH: And we`ll be watching your reports tonight on NBC
"Nightly News" and also on "Rock Center."

When we return, let me finish with why it took so long to finally
catch Jerry Sandusky once and for all.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

SMERCONISH: Let me finish tonight with this.

Now that former FBI director Louis Freeh has delivered on Sandusky,
it`s time for some fact-finding about the response by law enforcement,
specifically the Pennsylvania attorney general`s office.

Published reports, most notably at "The Patriot News" where Sara
Ganim earned a Pulitzer for her Sandusky coverage, raised some troubling
questions. The case that finally brought down Sandusky was first reported
by a high school student. The local district attorney recused himself from
handling the case due to a potential conflict. And it was referred to the
state attorney general`s office, then headed by Tom Corbett who was at the
time running for governor of Pennsylvania.

The A.G.`s office was then pursuing bonus-gate. That was an
investigation of state municipal corruption and that effort required a
significant commitment of resources.

According to "The Patriot News," the first year of the Sandusky
probe, there was only one investigator assigned to the case. Moreover, it
took that investigation a year to figure out that Sandusky had been the
subject of a 1998 probe for similar behavior. And it took a year to learn
that Sandusky had penned an oddly titled manuscript called "Touched." A
year?

As Sara Ganim noted, a Google search of the name Jerry Sandusky would
have revealed the book in seconds. And this is significant, because
ultimately, it was a road map for finding victims. Many of whom were
written about in the book and even pictured in the book.

To state the obvious, when you have a suspected pedophile on the
street, you need to move with all possible speed so as to protect children
from assault. This case took three years to bring to conclusion from when
the high school boy first made his report to when Sandusky was arrested.

Critics have suggested that then-Attorney General Corbett drew out
the investigation until after his successful 2010 gubernatorial campaign
had ended. Both Corbett and state police commissioner Frank Noonan reject
those claims, saying that investigators proceeded cautiously in an effort
to insure they uncovered enough evidence to corroborate victim one`s
claims. That evidence finally came in early 2011 after Corbett was sworn
in as governor and the investigative team dealing with the case grew from
one to eight -- finally.

So with Judge Freeh having analyzed the response by Penn State to
Sandusky, there is still a need for an accounting of the way in which the
case was handled by law enforcement.

That`s HARDBALL for now. Thanks for being with us.

"POLITICS NATION" with Al Sharpton starts right now.

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

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