updated 8/3/2012 3:32:29 PM ET 2012-08-03T19:32:29

August 2, 2012

Guests: Bob Shrum, Steve Moore, Max Pappas, Michael Scherer, Amanda Terkel,
Joe Donnelly

CHRIS MATTHEWS, HOST: Invasion of the body snatchers.

Let`s play HARDBALL.

Good evening. I`m Chris Matthews in Washington.

"Let Me Start" tonight with this. Overnight, the battle has escalated
between Obama and Romney. Before, the question was fairness. Is it right
to give big tax breaks to the rich? Well, today, the issue has sharpened.
Is it suicidal to give tax breaks to the rich while raising the taxes of
the middle class?

Is it simply class warfare to push giving tens of thousands in tax
cuts to those at the very top, paying for those breaks with an average of
$2,000 in higher taxes each year for people in the middle?

Welcome to the new battle over economics here at home. The middle
class faces a tough enough burden these days. Do we want to weigh them
down further, ourselves down further, with this still heavy burden of this
$2,000 in new taxes, Romney taxes, so the better-off get the best deal of
their lives? That`s the new state of play.

To assess the politics, we`ve got a war unto itself here tonight, Bob
Shrum`s a Democratic strategist and Steve Moore writes for "The Wall Street

Gentlemen, I`m talking about this decision. The Obama campaign is
taking this new study that`s just come out showing a Romney-style plan
helps the rich at the expense of the poor, and they`re running with it.
This bar graph you`re looking at right now from the report shows how
various income brackets are affected. And clearly, the poor get hurt and
the rich get helped.

Today the Obama campaign made this the centerpiece of a new ad that
will air in eight swing states. Let`s watch it.


UNIDENTIFIED MALE: You work hard, stretch ever penny. But chances
are, you pay a higher tax rate than him. Mitt Romney made $20 million in
2010 but paid only 14 percent in taxes, probably less than you. Now he has
a plan that would give millionaires another tax break and raises taxes on
middle class families by up to $2,000 a year. Mitt Romney`s middle class
tax increase -- he pays less, you pay more.


MATTHEWS: Well, what do you make of that, Bob? This is a stronger,
tougher, more escalated battle. It`s not just whether it`s fair or nice to
give big tax breaks to the rich. Here we have a study that shows every
buck they make -- in fact, tens of bucks, actually, in each case -- there`s
a dollar added to the burden of those in the middle.

BOB SHRUM, DEMOCRATIC STRATEGIST Yes, look, it`s a very effective ad.
I love that picture at the end, by the way, where he`s getting off the
plane and the plane right behind him says Trump. That sends a nice
subliminal message, too.

The Romney people are trashing this study. They`ve quoted the
organization themselves before. The fact is, a George -- that a Bush
adviser was the co-author of this. They made assumptions that were
favorable to Romney both in terms of growth and in terms of what would have
to be cut.

They don`t agree entirely with the idea that somehow, this all pays
for itself, and it didn`t in the Reagan years. But they do come up with a
bottom line, that $2,000 a year you`re talking about.

This has been a terrible month for Romney. He was awful overseas. He
comes back to this. Unlike the recommendation Michael Steele made on this
network last night, the former RNC chairman, he`s not going to release his
tax plan. He`s not going to release his tax returns. And I think he`s
eroding his standing.

I mean, right now on the new Pew poll, he`s 10 points behind and he
has a 37 favorable and a 52 unfavorable. This argument, no matter where it
goes, is hurting Romney badly.

MATTHEWS: Let`s go to this question with Steve. Steve, what do you
make of this report? And I want to make a couple points. The assumptions
here are -- Romney has laid out what he believes he can do, which is cut
corporate rates, maintain the Bush tax cuts all the way up to the top of
the income levels, and at the same time keep the total level of revenue
equal to what it is if you didn`t do -- make those changes.

And my question is, if you do that, keep the neutrality there, also
get rid of the -- make sure you`ve got the minimum tax removed and make
sure that all the incentives for investment and saving are maintained, how
do you all that and at the same time not reduce revenues or lay the new
revenue responsibilities onto the middle class?

STEVE MOORE, "WALL STREET JOURNAL": Well, let me just respond to one
thing that Bob said, if I may, Chris.

MATTHEWS: Sure. Go ahead.

MOORE: Bob, I agree -- I agree -- I agree with you that Mitt Romney`s
had a lousy month, but you know who`s having an even worse month is Barack
Obama. I mean, there`s two statistics that Barack Obama can`t get around.
One is 1.5 percent growth, which is anemic. It`s barely keeping us out of
a double dip recession. And the other is 8 percent unemployment for 40
straight months. Those are devastating numbers! And all of this other

SHRUM: Why don`t you debate the tax thing instead of trying to shift
the subject?

MOORE: All right, so let me...

SHRUM: Give an answer on the tax thing. You going to give me the
Reagan fantasy again?

MOORE: All right, Bob. So let`s get to this issue. First of all,
what the Romney plan basically says, Chris and Bob, is that 20 percent
across-the-board reduction in tax rates for everybody. So there`s no --
this fantasy that somehow the middle class is going to pay more -- no,
they`re going pay less!

You`re getting this confused with the Obama/Harry Reid plan that
doesn`t fix the AMT, where people next year are going to face a $2,000 tax
increase if we don`t do something about extending the Bush tax cuts.

But where in the plan -- show me, Bob, or show me, Chris, where in the
plan it says anything about tax increases on the middle class. The one
thing I will agree with you both on, a criticism I`ve made of Mitt Romney,
is I do think he`s going to need to be more specific about what tax breaks
you`re going to take away from people to help pay for this.

SHRUM: Well, that`s how you get the...


SHRUM: That`s how you get the tax increases.

MATTHEWS: You just finally got there. Took you a while, Steve, to
get to the reality here. If you`re giving a tax break to the richest
people in the world, somebody`s got to pay for it if you`re going to have
the same level of revenues. Bob, you do it.

MOORE: Hold on. You`re leaving out something!

SHRUM: Look, the fact is -- the fact is, they assumed when they did
this study -- and this is -- look, this is a reputable group. Mitt
Romney`s campaign has quoted them time and time again. When they did the
study, they assumed that the tax breaks that were going to be taken away
were going to be as fair as possible.

But given the size of the tax cuts, you`re going to end up with the
middle class having to pay $2,000 more, the average middle class family.
That`s the bottom line of the study. And changing...

MOORE: Yes, but they just assumed that!

SHRUM: ... the subject, that is the bottom line. You know, Steve,
you`re smart.


SHRUM: You can read the study.

MOORE: I have read the study!

SHRUM: You don`t have to sound like the Romney fog machine.

MOORE: I`ve read the study and I`ve read the Romney tax plan.
There`s nothing in the Romney tax plan about...

SHRUM: There is nothing in the Romney tax plan...

MOORE: ... raising $2,000...

SHRUM: ... that`s right.


MATTHEWS: I want to referee for a second. No politician, left, right
or center, is stupid enough to spell out how he`s going to screw people.
You have to read it to understand that.

MOORE: You have to make it up!

MATTHEWS: And if he`s going to give a huge -- no, you tell me, simply
put, if you`re giving a big tax break to people at the top -- corporate
breaks, Bush tax cuts for individuals, the whole routine -- and then you
say, I`m going to keep the same level of revenue, well, anybody with a
brain knows somebody else is going to pay the piper here.

MOORE: Yes, but you know who...

MATTHEWS: You answer that question.

MOORE: OK, I will answer that question...

MATTHEWS: Who else is going to pay?

MOORE: They`re going to take away the tax deductions, some tax
deductions. We don`t know which ones those are.

MATTHEWS: Oh, yes!


MOORE: Hold on! Let me finish this point. But what we do know is
when you take away tax deductions, the top 3 percent, those people, Chris
and Bob, that you want to tax more, they get 50 percent of the gains from
all these tax deductions. A good example -- you know, a millionaire gets a
much bigger tax deduction on the mortgage deduction than somebody who has
$100,000 house!

SHRUM: But the study calculated this and said that on balance, people
at the top get a big cut, even when you take away those tax deductions, and
people in the middle and at the bottom get a big increase.

MOORE: But Bob, they don`t take account of one other...

SHRUM: The only answer to this...

MOORE: ... important point...

SHRUM: ... is to put the plan out there and let people look at it.

MOORE: There is...

MATTHEWS: I hate to break it to you, Steve. You`re the ""Wall Street
Journal" guy. People at the top don`t have mortgages. They borrow the
money on their liquid assets. They don`t even have to go to the trouble of
mortgages. Why are you -- you`re laughing already!

MOORE: No, look...

MATTHEWS: You know they`re not sitting around, worrying about their
mortgage payments, multi-millionaires. Come on!

MOORE: That`s not true. They buy bigger houses.


MOORE: They make...

MATTHEWS: Oh, yes, right.


MATTHEWS: There are already restrictions on that.

MOORE: ... economic growth!

MATTHEWS: Look, let`s take a look at this...

MOORE: Bob, what you`re missing...

SHRUM: Put out the plan.

MOORE: ... there`s economic growth from cutting tax...

SHRUM: Put out the tax returns.


SHRUM: Let`s get the truth out there, and maybe Romney won`t be
losing by 10 points.

MATTHEWS: You know what I think, guys? And this is going to squelch
this conversation a little bit, but I`ll give it to you at the end. I
think there`s a new tax being considered here to protect the lower rates
for the top people and to avoid having huge deficits. There`s only one
answer to that, a new form of taxation so you don`t have to tax the rich,
where you really go for the money, or have bigger deficits. And I think
it`s a VAT, and I think it`s going to be proposed if Romney wins.

MOORE: Thumbs down on that.

MATTHEWS: Well, you`re (INAUDIBLE) but not all you guys, I`ll tell
you that. And not Romney yet. And if I had him in a debate, that`s the
first question I`d put to him -- Will you rule out a VAT or not? Anyway --
because I think he`s ruling it in.

MOORE: And the answer is yes.

MATTHEWS: Well, you would, but you`re not running.

Anyway, this morning on a press call to preview Romney`s economic
plan, campaign aide Fehrnstrom, who seems pretty smart, dismissed the Tax
Policy Center report. Let`s listen to him flack for Romney.


referenced is a joke. There are serious flaws with both the authorship of
that study and the methodology. It was co-authored by a member of the
Obama White House, someone who was part of the White House economic team.


MATTHEWS: Well, a flack will tell you half the truth. The other half
was that -- that he didn`t tell you was it was also co-authored by a Bush
W. (INAUDIBLE) a veteran, I must call him, anyway.

Well, today in Orlando, Florida, President Obama called out the Romney
campaign criticism. Let`s listen to the president here.


this is a liberal organization, despite the fact that it`s headed by an
economist who worked for George Bush. Then they said that the study failed
to fully take into account the massive economic boom that would come from
cutting taxes on the wealthiest Americans and the biggest corporations.
Because we all know how well that worked out the last time we tried it!



MATTHEWS: There it is again, cut rates and you get more revenue, the
old dynamic scorekeeping that`s always been proven wrong.

But Bobby, you start here. They want to make the case that they cut
the taxes for the rich, somehow the poor benefit. It`s trickle-down.
Absolutely in our face. Give a bigger break to the guy who`s got all the
money, and somehow, the peons will do better.

Go ahead. That`s what they`ve been selling since Reagan.

SHRUM: Right. Well, Steve and I are going to disagree on the merits
of this, but I -- you know, the Reagan thing, in my view, is a fantasy.
What happened in the Reagan years was they cut taxes, had big deficits, and
that`s why the economy got better. The tax cuts didn`t pay for themselves.

But politically, the president is in the right place here. The
country agrees with him on whether the wealthy should pay more. The
country certainly agrees with him that the middle class shouldn`t pay more.
That`s being held hostage right now by Republicans in Congress to give a
tax break to people at the top.

And as this goes on -- you look at that ad that you showed at the
beginning and you listen to the president here, it`s pretty clear who`s
going to win this argument politically as between Fehrnstrom and Romney --
and I don`t know to lump Steve Moore in with them...

MATTHEWS: Well, let me -- let me -- let me put a thumb...

SHRUM: ... and the president.

MATTHEWS: ... on the scale here. Bob, there`s one thing I see that I
think shatters the argument that this fairness over taxes will win the day.
If it`s true that at the margin, the independent voter, the undecided voter
who`s trying to make up his or her mind right now, why do all those 19 or
so Democrats...

MOORE: Thank you!

MATTHEWS: ... join the call...

MOORE: Thank you!

MATTHEWS: ... for complete...

MOORE: Thank you!

MATTHEWS: ... continuation of all the -- I think they come from rural
and conservative areas.


MATTHEWS: They`re afraid. But they have all jumped ship there, Bob.

SHRUM: Yes, but...


SHRUM: But the independent voters in the polling are in favor of the
wealthy paying a higher share...

MOORE: Well, why did they...

SHRUM: ... a fairer share of the taxes.

MOORE: ... jump ship? Why`d they jump ship...


SHRUM: Because they`re cowards. They`re scared. Look, the president
is what matters...

MOORE: No. Bob...

SHRUM: ... here. He`s going to go out...


SHRUM: ... and he`s going to offer a fundamental choice. Who stands
up for the few and who stands up for the many in this country?

MATTHEWS: Steve Moore...

SHRUM: Who`s fighting for the middle class, who`s fighting for people
at the top?

MATTHEWS: OK, Steve, here`s your shot. Go for it.

MOORE: OK, look, you nailed it, Chris. Nineteen vulnerable

MATTHEWS: I know nailed.

MOORE: ... in battleground...

MATTHEWS: I`m just wondering why they`re chicken. They`re chicken.

MOORE: No, you said it better than I could!


MOORE: Nineteen Democrats who are in battleground districts and
they`re not wealthy areas -- these are middle class, working class
oftentimes, rural areas -- voted to extend all the Bush tax cuts an all the
2001 and 2003...

MATTHEWS: Was that an act or courage...

MOORE: ... tax cuts. Bob is...

MATTHEWS: ... or an act of cowardice?


MOORE: ... because they think it is good politics. And you know
what? I think Mitt Romney is right on the politics.


MOORE: He`s right on the policy! And whatever you say about...

SHRUM: There are no numbers that support that.

MOORE: Bob, hold on.



MOORE: Bob, hold on. Let me finish. You said, Bob, a few minutes
ago that the Reagan tax cuts didn`t pay themselves, and you might be right
about that. But Chris, you and Bob cannot deny is we had an incredible
economic boom when we cut those tax rates...

SHRUM: Yes, because we had a Keynesian economic policy that
stimulated the economy!


MATTHEWS: Hey, look, we all agree that tax cuts generally stimulate
growth in the economy...

MOORE: Thank you!

MATTHEWS: ... but that`s a Keynesian argument and a supply-side

MOORE: No, it`s not!

MATTHEWS: Everybody agrees with that. The fact is, if you shift the
tax burden to the middle class, are you smart or are you just screwing the
regular people out there?

Anyway, thank you, Bob Shrum.

SHRUM: Thank you.

MATTHEWS: And thank you, Steve Moore. You had a good shot on the
show tonight. Don`t knock it. Anyway, thank you.


MATTHEWS: Hot tea! Tea Party candidates are winning primaries and
many are poised to go to the Senate right now. Oh, great. The behavior in
the House will now be followed by the behavior in the Senate. Oh, boy.
What happened to the upper house?

Anyway, not so fast. Could these guys cause more trouble for the
Republicans than for the Democrats? That`s my question tonight, is Tea
Party just trouble?

And plus, one right-winger out there is going after another right-
winger. Frank Gaffney`s going after -- guess what? -- Grover Norquist,
saying he`s a member of the Muslim Brotherhood or working for them. What`s
going on on the right, or should we just sit and watch the joyous craziness
on that side of the world?

Anyway, speaking of right-wing extremists, Indiana Senate candidate
Richard Mourdock says his idea of compromise is having the other side cave
in to him. And that`s how Tea Partiers think. Democratic congressman Joe
Donnelly is even in the polls with Mourdock, and Donnelly comes here
tonight to play HARDBALL.

Finally, should English become America`s language that you have to be
able to speak fluently before you join the country, become a citizen? It`s
never been the rule before. You simply need fluency in some language.
Well, John Conyers has an interesting salvo for Congressman Steve King,
who`s pushing the bill.




MATTHEWS: I don`t think that`s fluency in any language. Anyway, no
word on whether King got a full translation.

And this is HARDBALL, the place for politics.


MATTHEWS: Bob Shrum just referenced, by the way, a new Pew poll at
the top of the show. Let`s look at it. It`s got -- we`re going to head to
the HARDBALL "Scoreboard" right now. Here it is.

It`s a big one. Obama now 51, passing the 50 percent mark, all of a
sudden, and Romney down to 41, a 10-point lead for the president. Keep an
eye on that one.

It`s a closer race, of course, in the 12 battleground states that
we`ve been following, but still a lead there for Obama, consistent with
other polls, 48-44. So it`s a wild national number right now, a big one
for the president.

We`ll be right back.



SEN. TOM COBURN (R), OKLAHOMA: There`s a big difference of viewpoint
in terms of what a Tea Party means (ph). I think they`re one of the best
things that ever happened in the country because, all of a sudden, we`re
reengaging hundreds of thousands of people in this country who go to work
every day. They obey the law, they pay their taxes, but they`re sick and
tired if what they see in terms of the waste and stupidity that goes on in


MATTHEWS: OK, Welcome back to HARDBALL. That was Oklahoma senator
Tom Coburn earlier today on "MORNING JOE," championing the Tea Party

Well, following the big Texas win by Senate hopeful Ted Cruz, the Tea
Party looks as if it`s gaining strength and will likely add another member
on Capitol Hill next year. It`s good news for the Tea Party, but is that
good news for Republicans, Democrats, or none of the above?

Max Pappas is vice president of the group Freedomworks and Michael
Scherer is the White House correspondent for "Time," who wrote the cover
story in the latest issue of "Time" magazine." There it is. We always get
it -- we always sell here.

This question of whether -- I look to last summer, this time last
year, as a great example of what the Tea Party can do to wreak havoc in
this country and to make sure no deals are ever made, nothing`s ever
resolved. We kick the big debts and the big deficits down the road for
(ph) more (ph) to do nothing with (ph) year.

As long as you`ve got 80 or so members of the House of Representatives
who are Republicans who will vote against any deal that allows any revenue
increase to coincide with huge cuts in spending -- they won`t go along with
it. Therefore, they render impotent even Eric Cantor, who knows how to
ride these guys and pretend he`s one of them, and kills Boehner as a
negotiating partner. And damn it, nothing gets done.

And we go right back -- it`s like the Middle East peace talks. As
long as you have Tea Partiers around, I will contend, nothing will ever get
done because they come to office with the single purpose of not being
legislators, of not negotiating, of not writing bills, but simply giving
little speeches.

Your thoughts, Max Pappas?

MAX PAPPAS, FREEDOMWORKS: I think it`s the other way around.


MATTHEWS: Do they come to Washington to negotiate? Do they come to
Washington to negotiate?


PAPPAS: They passed tons of bills in the House. They sent them to
the Senate that Harry Reid controls and he sits on them.


MATTHEWS: Let`s get back to the point. When it comes to reducing the
cost of government and making deals that the Democrats will go along with -
- and that`s the only way you get something done in our current form of
government that has two parties in it -- what have they done to bring a
deal to the floor?

PAPPAS: They passed a bipartisan-supported bill to repeal Obamacare,
sent it over the Harry Reid in the Senate.

MATTHEWS: Well, there`s a bipartisan measure. They want to screw


MATTHEWS: This is the kind of talk that works out in the villages
where people give speeches, but has no relevance to running this United
States government.

Your thoughts? You`re covering it and you`re objective. So tell me
will Tea Partiers ever negotiate a deal that would actually reduce the
federal deficit and reduce the debt down the road?

MICHAEL SCHERER, "TIME": I think if Romney is the president, there is
a much better chance than if Obama is the president.

MATTHEWS: How will it work?

SCHERER: It will be difficult. And what we`re talking about here is
-- you`re talking about the freshman class in the Senate.


MATTHEWS: I`m talking about people like this guy Ted Cruz, people
like this guy Mourdock in Indiana. We`re going to have his opponent on

PAPPAS: They`re going to be stars. They`re going to be fantastic.


MATTHEWS: See, your goal is to reduce the government to what, to a
non-functioning irrelevancy.

PAPPAS: Here`s the compromise. I will reduce it down to where we`re
not borrowing 40 cents on the dollar.

MATTHEWS: OK. Let`s take a look. In other words, no deal.

PAPPAS: Deal if we get back to balance.

MATTHEWS: How about you get a 10-1 deal? Cut 10$ in spending for $1
in revenues?

PAPPAS: Let`s start with the cuts.


MATTHEWS: No, you don`t get the cuts by themselves.

PAPPAS: Usually, the way those 10-1 deals is it`s like the wimpy
version of politics, like from "Popeye."


PAPPAS: I will gladly pay you Tuesday for a hamburger today. So the
tax hikes...


MATTHEWS: Great, except that you`re not going to get any other kind
of deals. Get rid the Democrats is your goal. Just get rid of them.

PAPPAS: Well, they can stick around as long as they`re going to vote
for bringing the federal budget back down.


MATTHEWS: As long as they vote right-wing, yes.

SCHERER: This is complicated because you`re talking about a Senate
where you still need 60 votes to get anything done. If you`re talking
five, six Republicans who are going to be playing this role, it`s going to
be hard for McConnell...


MATTHEWS: If Romney wins, pulls a victory this fall, the Pelosi
people come in and vote against everything he does. And you will have the
same kind of logjam, and you guys will love it because it makes the
government stink.

The more people hate the government, the more you like it. The more
it fails, the more you like it, isn`t it? You`re laughing about it.


MATTHEWS: The more you reduce the reputation of the American
government, the more the Tea Parties like it.



PAPPAS: If you look at the graph, you slow down spending for one
year, you get a long-term benefit. We stopped it for this year. We would
like to keep it flat for another year.

MATTHEWS: Why should Democrats cut programs that hurt regular people
unless they see something done to wealthy people to make them feel the

PAPPAS: I don`t think that`s what the problem is.

MATTHEWS: Just try to think....


MATTHEWS: Let`s take a look at it. Yesterday, we showed you a Club
for Growth advertisement attacking Ted Cruz`s opponent with that nasty word
he`s a moderate, he`s a moderate.

Well, he`s a Cruz campaign ad comparing politicians to real
conservatives. Take a look.


NARRATOR: Politicians from both parties have broken promises, driven
us to the brink of bankruptcy and failed to secure the border. Politicians
cut deals. Principled conservatives deliver. Ted Cruz, a proven
conservative fighter who delivers.


MATTHEWS: OK. So, Michael, you cover the politics of this thing.


MATTHEWS: How does a conservative get something done without passing
bills that actually achieve cuts in deficits or debt?

SCHERER: It`s a long-term problem, not just immediately what you`re
talking about, but for the Republican Party.

The most enthusiast part of the electorate right now is the Tea Party.
It`s been that way for -- we`re going on three years now that`s been the
case. The problem is the Republican Party is being pushed to the right by
this. And the Republican Party is now in a situation where Mitt Romney
could lose the election and win, what, 59 percent of the white male vote in
this country.

The demographics of the country are moving a different way and the
Republican Party is moving towards its base. So, over the long term, if
the Tea Party people who get into the Senate, who get into the House don`t
at some point start making deals, the trajectory of this enthusiasm bump,
which is really a core group -- it`s not a majority of even the party --
begins to create problems for the party.


MATTHEWS: I think a lot of it is ethnic, too. And I`m not trashing
people as racist or anything, but I think a lot of it is ethnic. They
don`t like the changing ethnic demographic of the United States. So every


PAPPAS: Especially the Hispanics like Ted Cruz.

MATTHEWS: No, no, no. He`s a Cuban-American.

PAPPAS: Cuban-American.

MATTHEWS: And that`s always been the little different situation.

PAPPAS: Or Marco Rubio.

MATTHEWS: And that`s always been a little different situation.


MATTHEWS: Every time a speech is written by a Tea Partier, they`re
not happy with saying we`re going to cut spending. They have got to say
we`re going to something to do with the border.

By the way, the border doesn`t cross against Cuba, by the way. It`s
always Mexico.


PAPPAS: That doesn`t -- that`s not a Tea Party position.


MATTHEWS: Well, why does Cruz make that statement? All of the time,
you hear border, border, border.


PAPPAS: What brings the Tea Party together across the country is at
the center of American politics. It`s not extreme. It`s let`s only spend
what we bring in. It`s fiscal policy.

MATTHEWS: You`re saying Tea Partiers don`t have an attitude about


MATTHEWS: They don`t?

PAPPAS: No. There`s not a consistent Tea Party position on

MATTHEWS: What do you mean there`s not a consistent -- how come when
you meet them they`re talking about the cause? It sounds like the
Confederate Army still fighting the Civil War when you talk to them.

PAPPAS: What we bring together Tea Partiers from all over the country
to FreedomWorks, what they agree on is on free markets, fiscal
responsibility and the constitutional limit to federal power. They
disagree on everything else, social policy, immigration.

MATTHEWS: My experience is that they`re on the far right.

PAPPAS: We will have you by next time they come, open door.

MATTHEWS: Far right. They`re far right. It is a far-right political

PAPPAS: Center of American politics.

MATTHEWS: I watched its behavior and I watched it bring down -- poor
John Boehner looks like a loser out there. He can`t deliver his own troops
because you`re independent of the Republican Party and to its far right.

PAPPAS: That`s right, but if we were to the far right, we wouldn`t be
winning. We`re at the middle of the American politics. We`re bringing in
the independents.

SCHERER: You`re winning primaries, though. You`re not necessarily
winning general elections.

PAPPAS: We`re seeing union guys that are disenchanted with their
unions. We`re seeing independents that voted for Obama.

MATTHEWS: Try to get Joe Walsh to deal with his domestic situation,
too, while you`re at it. Some of these guys are a little difficult when
they start...


MATTHEWS: ... fiscal responsibility.

Anyway, thank you, Max.

I love fiscal responsibility at home, too.

Max Pappas, Michael Scherer, thanks for joining us.

Up next: The line of public officials fed up with Michele Bachmann
gets even longer. And this is HARDBALL -- no surprise they have had it
with her -- the place for politics.


MATTHEWS: Back to HARDBALL. Now to the "Sideshow."

A group of former U.S. officials have teamed up with NGO leaders and
others to call for Republican Congresswoman Michele Bachmann and two of her
colleagues to be removed from their posts on the House Intelligence

Bachmann and friends drew a firestorm of backlash for suggesting that
some members of the U.S. government have ties to the Muslim Brotherhood.
The list included Huma Abedin, a top aide to Hillary Clinton.

In a letter to John Boehner and Nancy Pelosi, the group wrote in part,
"Representative Bachmann`s advocacy of these conspiracy theories is
particularly damaging to U.S. interests because of her greater prominence,
including the fact that for a time she was taken seriously as a
presidential candidate. Despite considerable criticism, these members of
Congress have refused to disavow their actions. We therefore urge you to
act to replace them as members of the Intelligence Committee."

So talk of Muslim Brotherhood infiltration from members of the House
Intelligence Committee might not play so well to the rest of the world.
You think?

Well, moving on, the House today debated Republican Congressman Steve
King`s bill to make English our official language and require potential new
citizens to be fluent in English.

Michigan Democrat John Conyers got his chance at the microphone during
the hearing. See if you can guess whether he`s in favor or not.




MATTHEWS: So he`s not in support of the English-only bill, of course.
Conyers said that it is one that the country would look back on with shame
and regret if it were ever passed.

Well, finally, for a break from politics, we have all heard of players
and even spectators getting evicted from -- or ejected, rather, from
baseball games. Right? Well, how about a P.A. system operator getting

That`s what happened in a minor league game in Florida light night,
the Daytona Cubs vs. the Fort Myers Miracle, after a questionable call was
made against the home team, the Cubs. A P.A. operator named Derek Dye
blasted -- quote -- "Three Blind Mice" for all to hear.

Check out how the home plate empire and the announcers reacted.




UNIDENTIFIED MALE: Do not play "Three Blind Mice."


UNIDENTIFIED MALE: Turn the sound off the rest of the night.


UNIDENTIFIED MALE: Derek Dye was ejected from the game. That is
awesome! That is absolutely awesome. That is so cool!


MATTHEWS: "That is so cool." Hmm. Booted from the game. Believe it
or not, this has happened before. In 1985, someone else was ejected from a
Florida minor league game in Florida, of course, for playing the same tune.
The umpires don`t like being called three blind mice.

Anyway, up next, conservatives pushing anti-Muslim scare tactics are
now targeting one of their own, Grover Norquist. The guy that makes
everyone pledge never to raise taxes is now being accused by a right-winger
of being in league with Muslim extremists. That fight`s ahead. Don`t miss
this one. This is fun.

You`re watching HARDBALL, the place for politics.


La Cruz. And here`s what`s happening.

Aviation officials say three planes flew too close to one another on
Tuesday, but were never on a collision course. They say miscommunication
between a radar facility and Reagan National was to blame.

An emotional Kofi Annan resigned earlier as the U.N. special envoy on
the Syrian crisis and has faulted the Security Council for its lack of
action on Syria.

And it was a losing day for stocks. The Dow slid 92, the S&P fell 10.
The Nasdaq also lost 10.

I`m Veronica De La Cruz -- now back to HARDBALL.

MATTHEWS: Welcome back to HARDBALL.

When Michele Bachmann, who we created here, I think, and other
Republicans requested an invitation -- or an investigation of whether
Hillary Clinton`s aide Huma Abedin was connected to the Muslim Brotherhood,
the so-called evidence they were relying on came mostly from the
conservative writer Frank Gaffney.

Gaffney sees himself as a Cassandra, warning of Muslim Brotherhood
infiltration at the highest levels of our government. And for years now,
he`s been focusing on a surprising target, fellow conservative Grover
Norquist -- yes, that Grover Norquist, the hard-line -- there he is -- the
anti-tax crusader who`s got 95 percent of the Republicans in Congress to
pledge never to raise a cent of taxes.

Well, Gaffney has accused Norquist of working with the enemy and
helping members of the Muslim Brotherhood infiltrate the U.S. government.
In turn, Norquist has called Gaffney -- I think appropriately -- a
conspiracy theorist.

For some conservatives, Gaffney`s campaign against Norquist is a step
too far. Last year, Gaffney was barred from speaking at the main
conservative gathering, the CPAC Convention, but Gaffney is not backing

Amanda Terkel is a senior political reporter for The Huffington Post.
And David Weigel is a political reporter for Slate.

By the way, The Huffington Post is just unbelievable these days. It`s



MATTHEWS: It`s zooming.

But what do you make of this? You`re covering it as a straight
reporter. Tell me, why is Frank Gaffney OK? I mean, he may -- I`m going
to get to it at the end of the show, but his accusations about different
logos at defense -- Missile Defense Agency might be really Islamic symbols,
and he`s finding things out there that may be delusional. I don`t know.

TERKEL: Other conservatives are lining up more and more, John
Boehner, Marco Rubio. John McCain is saying that, look, he`s peddling his
conspiracy theories. He`s been accused of bigotry by members of his own

MATTHEWS: Bigotry towards whom?

TERKEL: Bigotry towards Muslim-Americans, basically.

The people he has targeted, with the exception of Norquist, tend to be
Muslim-Americans. And they have been accused of being members of the
Muslim Brotherhood with very, very little evidence. And other
conservatives are rejecting his claims.

MATTHEWS: That`s pretty rotten.

When I was in New York last week, and you see people who work at the
stands, they work all night at the food stands outside on the big avenues
like Sixth Avenue, and you see the prayer mats out at certain times at
night, and they`re praying, and they`re like great Americans who are trying
to make it in this country with little background, and they all feel -- I
don`t know what they feel when they read this crap.


MATTHEWS: Like everybody who is Islamic is a bad guy, all the
Turkish-Americans, everybody who comes from the Balkans, everybody who has
any background that might -- even Europeans with Islamic background,
anybody is now targeted by this stuff.

TERKEL: These accusations have consequences too.

Someone that`s been targeted by a lot of these accusations, he is an
adviser to the Department of Homeland Security, has a security clearance,
he has received death threats. Law enforcement had to come to his house,
check out a suspicious package. These don`t go into a void.

MATTHEWS: You know, a terrorist suspect, he`s -- and then you have
people come on and say, oh, they`re just investigating. People like Newt
say, oh, they`re just investigating.

How would you like to be a terrorist suspect, a communist suspect?
That`s enough.

Your thoughts?

DAVID WEIGEL, MSNBC CONTRIBUTOR: Oh, they draw these connections very

Now, the Norquist-Gaffney feud goes back a very long time. Gaffney
was arguing that Norquist introduced George Bush to some very rotten


MATTHEWS: Does he believe he`s an agent of terrorists?

WEIGEL: Does Norquist -- does Gaffney that believe Norquist is? Oh,
yes, he said that outwardly. He said that -- the last time he was able to
speak at CPAC, said that from the stage, denounced him.

MATTHEWS: That a conservative who is intent on reducing the size of
government by cutting taxes, is known to be a fanatic on that subject, is
somehow a fanatic conservative, but not a loyal American?

WEIGEL: Yes, but he doesn`t twin those issues.

He says, look, this guy introduced Sami al-Arian to George Bush. This
guy brought al-Moody (ph) to the White House. What was he lobbying for?
And because people that Norquist introduced Bush to years ago became


MATTHEWS: OK, the idiocy of this.

WEIGEL: All right. OK.

MATTHEWS: That Huma Abedin, who is Hillary`s very close friend -- she
is like deputy assistant -- but she`s very close. They travel together.

Does anybody spot anywhere n Hillary`s argument position? She`s one
of Israel`s best friends of the world, appropriately so. She`s an American
envoy. But what influence has been there?

DAVE WEIGEL, SLATE: Well, if you like Bachmann`s letter, the thing
she cites are kind of minor. I mean, she cites that Tarif Ramadan was able
to enter the United States. He`s a pretty controversial scholar before.
But that was policy that a lot of people agreed with. Some of the moves of
the Obama administration made towards the Arab world.

Look, the president has been pretty open about that. He ran on that.
He ran

He met on meeting with these. The way they look at those is kind of
let`s find the roots behind all this. It can`t just be it`s the politics.

MATTHEWS: So, the alternative strategy basically, if you want America
to be secure, you`re a young woman, for the next hundred years, let`s make
enemies of all Arabs and Islamic people. Let them all know that persona
non-grata. That would be a strategy for winning hearts and minds in the
world, right? Make sure they do we think they`re the enemy.

committed is basically trying to expand the conservative movement bring
more people like Muslim-Americans into the conservative movement. And
that`s what Frank Gaffney seems to be upset about. He says that Norquist
is basically expanding the influence of the Muslim Brotherhood and these
are Islamic terrorists in the conservative movement.

MATTHEWS: Well, some -- excuse me -- sometimes the logic of Gaffney`s
charges can seem a little confusing. That`s being pleasant.

Listen to what institutions he said Norquist was helping, the Muslim
Brotherhood, infiltrate. It may surprise you. Let`s watch what he`s
claiming is happening here.


FRANK GAFFNEY: That became sort of the entry point for member Muslim
Brothers to work their ways into conservative circles specifically to get
into the Bush campaign and subsequently Bush White House and


MATTHEWS: I was thinking of the movie "The Beautiful Mind". I was
thinking, you know, the guy all these things on the wall, you know. I`m
thinking he says, the way that Gaffney, this evil man he`s been trailing as
he said like Joe Bear (ph) for 12 years, was using W. Bush, the most
toughest in the Arab world president we`ve ever had as somehow an agent of
the Muslim Brotherhood. That`s transparently ridiculous.

WEIGEL: Again, based on something that`s almost a dead letter. It
happened 12 years ago. I mean, Norquist did facilitate --

MATTHEWS: Where is the pro-Arab influence of George Bush out there?

WEIGEL: It kind of stop after 9/11. No, all this effort stopped. I
mean -- but because that happened and Norquist continues to fraternize with
these people, he thinks it still might be -- it still might be relevant.
And -- I mean, you`re characterizing it the way you heard this, this is how
the theories develop, right?

There are a couple of reeds of truth. And if you want to believe
something darker, you take those and you run (INAUDIBLE) with them.

MATTHEWS: How`s the American Conservative Union? Was this sort of
like the big tent for all conservative thinking putting this together? How
does that ever work? Are they going to side with Norquist against Gaffney
and say this election is about economics not crazy theories? We`re going
with economics?

TERKEL: So far they have. I mean, Frank Gaffney`s argument is, if
you know what I know, you will believe what I believe. But he presented
all his evidence to the ACU board, Cleta Mitchell, and she said there seems
to be nothing here at all and the board unanimously agreed with her.

MATTHEWS: Proving the conspiracy.

TERKEL: Right.

MATTHEWS: That`s what conspiracy theorists say. You just proved it.

TERKEL: Gaffney wants to try it again.


MATTHEWS: Thank you so much, Amanda. It`s great to have you both on.
Amanda Terkel, thanks for coming. Great Huffington Post" -- great

Thank you, Dave Weigel.

Up next, Democratic Congressman Joe Donnelly is the only thing
standing in the way of a far right extremist Richard Mourdock from winning
a Senate seat out in Indiana which is one held and currently held by a
pretty good senator. Joe Donnelly is coming here next.

This is HARDBALL, the place for politics.


MATTHEWS: Well, yesterday, we told you about President Obama`s lead
in the polls in some key swing states. But incumbent Democrats also have
leads in those Senate races out there. Let`s check the HARDBALL score
board on some good news for progressives.

In Florida, it`s Senator Bill Nelson with a seven-point lead over
Republican Connie Mack. I guess they know he`s not his father. That`s
according to the CBS/"New York Times`/Quinnipiac poll.

The poll also found that in Ohio, Senator Sherrod Brown has a 12-point
lead over Republican challenger and self-financer Josh Mandel.

And in Pennsylvania, I`m always watching that one, Bob Casey with an
18-point lead. But I know Bob, he`s still working hard.

Finally in Michigan, Senator Debbie Stabenow is up 14 over Republican
Pete Hoekstra. It`s pretty popular name there, too.

This has got to be tough in these races. But that`s according to the
epic MRA poll. A lot of good news for liberals tonight.

We`ll be right back.


MATTHEWS: We`re back.

What can you say about a Senate candidate who proudly declares that
his idea of compromise is making the other side cave in? That`s exactly
the language used by Richard Mourdock, the Tea Party candidate, who
defeated the great Richard Lugar in the Republican Senate primary out in
Indiana. Take a look.


about compromising bipartisanship is I hope to build a conservative
majority in the United States senate so that bipartisanship becomes
Democrats joining Republicans to roll back the size of government, reduce
of bureaucracy, lower taxes and get America moving again.


MATTHEWS: He`s not exactly laughing when he says that absurdity.

Anyway, imagine what happened if every senator talked like that guy?
Would anything ever get done? Don`t compromise on anything.

Anyway, U.S. Congressman Joe Donnelly is a moderate Democrat. He`s
running against Mourdock this November in what could be a very tight race.

Congressman Donnelly, you`re a Notre Dame guy, so I like you already.
So, I`m allowed to say that. But let me ask you this - is this a close
race right now fairly put?

REP. JOE DONNELLY (D), INDIANA: It is. The last poll put it a dead
heat 42-42.

MATTHEWS: Now, I notice in your speaking, and you`re out there openly
doing what Jack Kennedy did in `52. You`re going, in his case, he went for
the Taft vote against Eisenhower. You`re going for the Lugar vote. You`re
actually opening yourself and saying if you`re a moderate Republican, you
voted for Dick Lugar all these year, you should vote for me, right?

DONNELLY: Absolutely. If you`re listening to Richard Mourdock, he
said that he`s questioning whether Social Security is constitutional,
whether Medicare is constitutional. He tried to destroy Chrysler. He has
had time after time, as you just saw, where he said my idea of compromise
is Democrats doing what we want them to do.

Lugar Republicans are thoughtful people, moderate Republicans who want
to try and move our country forward. That`s not what Richard Mourdock is.

MATTHEWS: But has your state -- I maybe implying to you here, but I`m
serious about it, I don`t think of Indiana as a right wing state. I mean,
it`s not Utah. It`s not Wyoming. It`s not Mississippi. You know, you
don`t have a history of that, do you?

DONNELLY: What we`re about is common sense. It is how do we work
together to create jobs, create opportunity, make our state grow, and make
our country grow. That`s what we`re looking for. We`re looking for people
to act like adults not like fifth graders.

MATTHEWS: You know, back in the `60s, I think it was `62, (INAUDIBLE)
flying too far to the right and your state dumped him. They said too far,
too mas.

Does your state still have the anti-far right attitude, you can`t get
that far?

DONNELLY: Absolutely. We`re about bringing solutions to the
problems. Don`t talk about it, get work done. They don`t expect us to go
to Washington and just give flowery speeches. We`re the hire help. We`re
sent there to get work done, to not talk about it, but to do it.

MATTHEWS: Here`s Mourdock -- after losing to Mourdock, Senator Lugar
actually wrote a very sharply worded concession letter. In it, he said,
quote, "If Mr. Mourdock is elected, I want him to be a good senator. But
that would require him to revise his stated goal of bringing more
partisanship to Washington. He will find that unless he modifies his
approach, he will achieve little as a legislator. Worse, he will help
delay solutions that are totally beyond the capacity of partisan

I`m just talking about this. I mean, you`re the expert, I`m the
watcher. I used to work on the Hill, as everybody knows. And every time
you try to get something done, you have to give something to the other side
or nothing gets passed.

DONNELLY: That`s exactly right. I live right on the Michigan line.
Fred Upton just across the line -- Fred and I worked together to get the
opportunity to have a veteran center in South Bend that didn`t cost
anymore. But as a team we were able to make our case.

Over in Ft. Wayne we were able to help save an air base there with a
Republican congressman from that area.

The way you get things done is to work together. This fellow is
talking about if he goes to Washington and there`s a Democrat Senate, he`s
not even going to try. He`s going to travel around the country giving

We`re hired to do work, not to travel around the country.

MATTHEWS: Well, last week, Mourdock made a somewhat startling
analogy, comparing the government bailout of Chrysler to slavery. Let`s


MOURDOCK: Mr. Lincoln said if it was a tribute from his subjects or
if it was offered as an apology by one race of man for enslaving another
race of man, it was he said, the same tyrannical principle.

It is once again that message from Washington, D.C. that even people
like those pensioners I represent can work and sweat and toil and earn and
save, so that someone else can be given their assets. It is the same
tyrannical principle as in 1858. But now it`s 2012.


MATTHEWS: You know, on a rhetorical level, I`m a student of this, I`m
not saying he`s like him. But there`s that kind of nasal voice, that sort
of indignant nasalness that Joe McCarthy used to use all the time. You

The some communist party that did this is the same one killing our
soldiers in Korea.

It`s that same kind of angry nasalness. What is that about? Is that
something that works in Indiana?

DONNELLY: He also compared trying to destroy Chrysler, he called it
his Rosa Parks moment.

MATTHEWS: What`s that mean to him?

DONNELLY: He has compared himself to Rosa Parks, an American hero.

MATTHEWS: She gets on the bus and won`t go to the back. How`s that
relate to him?

DONNELLY: I have no idea how he thinks that has anything to do with
Chrysler or his actions. She is an American hero. He`s tried to destroy
over a hundred thousand jobs in Indiana. In Indiana, we want you to focus
on creating jobs, creating opportunity and we honor our American heroes.
We don`t talk about them in a way that makes no sense.

MATTHEWS: I`ll be surprised if Indiana jumps in the nut barrel.

DONNELLY: They`re not going to see.

MATTHEWS: Well, we`ll see. Good luck to you.

DONNELLY: Thank you very much.

MATTHEWS: We can`t endorse, but good luck. It seems like you`re an
interesting candidate and probably a good one. Anyone, Notre Dame, sing
the song together.

Anyway, thank you, U.S. Congressman Joe Donnelly, running against a
wild man.

When we return, let me n finish with the man on the far right, wait
until you catch this, between Frank Gaffney, I don`t know about that guy,
and Grover Norquist, I don`t know if I like that guy.

You`re watching HARDBALL, the place for politics.


MATTHEWS: Let me finish tonight with this. Never interfere with the
enemy while he`s in the process of destroying himself. Napoleon Bonaparte
is supposed to have said that, and it seems a smart advice for reasonable
people watching the crazy intramurals we talked about tonight. I`m
referring to what neoconservative Frank Gaffney is saying about tax avenger
Grover Norquist.

According to Gaffney, who normally champions the latest war overseas,
Norquist is secretly working with the enemy within. That he`s doing the
work of -- you guessed it -- the Muslim Brotherhood.

Well, listen to his words and think about someone who might say them.

"I have had it as more personal burden for the past 12 years to try to
warn conservatives one of their own has been actively involved both
enabling and empowering Muslim Brotherhood influence operations against our
movement and our country."

Well, he goes further. Gaffney says it all starts with the Bush White
House. That the people around President George W. Bush. Quote, "That
became sort of the entry point for Muslim brothers to work their way into
conservative circles, specifically to get into the Bush campaign, and
subsequently the Bush White House and Bush administration more generally."

Well, this is from the same accuser who once made and then withdrew a
charge that the logo of the U.S. Missile Defense Agency bore a nefarious
similarity to the Islamic crescent and star. Something nefarious, he said,
was afoot.

So this strange war goes on between the questionably accountable and
the seriously brutal, between the defenders of the faith and the enforcers
of the conservative order. One demands that politicians make oaths of
loyalty to him, and the other questions the national loyalty of the one
demanding the signatures.

Stick with Napoleon on this one. Just stay in the stands and watch
these gladiators go at it right through the election.

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

"THE ED SHOW" starts right now.


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