updated 8/13/2012 3:00:57 PM ET 2012-08-13T19:00:57

Guests: Andrea Mitchell, Chuck Todd, Rachel Maddow, Melissa Harris-Perry, Howard Fineman, Avik Roy, Ezra Klein, John Nichols

CHRIS HAYES, MSNBC ANCHOR: Good morning from New York. I`m Chris
Hayes. We are awaiting word later this hour from Mitt Romney with his
official announcement of Wisconsin Representative Paul Ryan as his running
mate. News of Romney`s choice of the 42-year-old Ryan came overnight and
comes as a surprise to many observers who expected him to make a safer
choice, like former Minnesota governor Tim Pawlenty, or Ohio Senator Rob
Portman.

Ryan who entered the House in 1999 has risen quickly through
Republican ranks becoming chairman of the powerful House Budget Committee
last year. He began his career as an aide to then Congressman Jack Kemp
and has cited Ayn Rand, the atheist Russian philosopher who championed
self-interest as one of his most important influences.

Ryan surged to the front of the V.P. pack in recent weeks on the
strength of his popularity among grassroots conservatives. His esteemed
among right wing activists as a visionary and considered the movement
intellectual leader for his proposed cuts to the federal budget which would
drastically reduce federal support for social safety net programs like food
stamps, cut hundreds of billions of dollars from a wide variety of
discretionary programs, and end Medicare as we know it.

The choice of Ryan then would seem to be an attempt to bolster
Romney`s standing among conservatives who have remained skeptical of
Romney`s conservative credentials even at this late date. The announcement
comes just two days after "The Wall Street Journal" urged Romney in an
editorial to pick Ryan calling him, the candidate that, quote, "best
exemplifies the nature and stakes of this election."

Ryan, however, voted for the Iraq war, and like Romney, lacks foreign
policy experience. And there`s much in Ryan`s record that contradicts his
image as a reformer and deficit cutter, leave him open to attacks from
Democrats.

Among other things, Ryan voted to approve the $800 billion Wall Street
rescue package, the auto-industry bailout, and the Bush tax cuts. Right
now, I am joined by Howard Fineman of the "Huffington Post" and Avik Roy
who is an adviser to the Mitt Romney campaign. It`s great to have you
gentlemen here this morning. Welcome.

HOWARD FINEMAN, MSNBC ANALYST: Good to be here. Thanks.

HAYES: Avik, I want to start with you. As someone who has been --
health care policy is the place where you`ve put a lot of your interest and
something you worked on.

I want to play this clip of Representative Ryan talking about Mitt
Romney`s Massachusetts health care plan because this, to me, gets at
something fundamental about what is in some deep sense somewhat of an odd
pairing and also about the ideological journey that Mitt Romney has been
on. Here`s Representative Ryan on C-Span in 2010 talking about Mitt
Romney`s Massachusetts healthcare.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: Do you believe that Massachusetts healthcare
reform system works, a system that Governor Romney --

REP. PAUL RYAN, (R) WISCONSIN: Not well. No, actually, I`m not a fan
of the system and I think that was part of it. What`s happening now is
because costs are getting out of control, premiums are increasing in
Massachusetts, and now, you have a bureaucracy that is having to put all
these cost controls and now rationing on the system.

So, people in Massachusetts are saying, yes, we have, you know,
virtually universal health care. I think it`s like 96 percent or 98
percent insured, but they see the system bursting by the seems. They see
premium increases, rationing, and benefit cuts. And so, they`re frustrated
with this system. Number one, they`re already paying for it.

They don`t want to pay for another system on top of it. That was, I
think, Scott Brown`s message. But, number two, they see how this idea of
having he government be the sole, you know, single regulator of health
insurance, defining what kind of health insurance you can have, and then an
individual mandate.

It is a fatal conceit in these kinds of systems as we`re now seeing in
Massachusetts are unsustainable.

(END VIDEOTAPE)

HAYES: All right. So, that`s -- I mean, Mitt Romney has not spent a
lot of time touting his signature policy achievement as governor in
Massachusetts which is the state`s healthcare provisions, but he also
hasn`t had words like that to say about it. What do you make of that kind
of critique?

AVIK ROY, ROMNEY HEALTHCARE ADVISOR: well, every time there`s a vice-
presidential pick, there`s always a certain set of small disagreements
about certain policy issues. When Joe Lieberman was picked, Joe Lieberman
has a lot of views that wouldn`t necessarily be shared by the top of the
ticket.

I mean, you`re going to have those kinds of disagreements. I think
where there`s huge agreement and why this is such a significant choice is
where we go from here. What`s the agenda for national reform? What`s the
agenda for Medicare reform?

What`s the agenda for healthcare nationally? And I think that`s where
Romney and Ryan are in exactly the same place. I think the stakes of this
election have gone up if --

HAYES: Well, that`s interesting. So, Romney and Ryan, that sentence
to me is the takeaway headline which is Romney and Ryan are in exactly the
same place. I mean, physically they are exactly the place right now in
Norfolk, Virginia, preparing to make this announcement.

FINEMAN: -- aboard the "U.S.S. Wisconsin," by the way.

HAYES: Of course. Symbolically apt because of Paul Ryan`s Wisconsin
roots. But I mean, that was the question here. And this was -- in some of
the conversation about whether Ryan would be on the ticket or not was Mitt
Romney had endorsed the Ryan Budget, but I would say he endorsed the Ryan
budget but was not running on the Ryan budget up until today.

And Howard Fineman, now, it seems inevitably and traumatically and
clearly he is running on the Ryan budget.

FINEMAN: Yes. I think if you step back and look at the big picture
of this. Mitt Romney`s entire career as a presidential candidate has been
dogged by the question of who he really is. Is he a Massachusetts moderate
or has he figured out how to be a conservative? Because it`s not as
natural language, really, of modern conservatism starting with Jack Kemp
and Ayn Rand and all of that, OK?

With this pick, Mitt Romney is saying, OK, this is who I am. I`m
committed to it. The question is whether people are going to believe him
and people on this network and elsewhere are going to say, now, wait a
minute. You have said this, Paul Ryan has said that. Are you guys really
on the same page here? Are you really on the same page?

HAYES: Yes. Let me be clear about the point of playing that tape. I
think they are on the same page. I think that the Republican Party and the
institutional bases of the Republican Party has absolutely unquestionably
moved in Paul Ryan`s --

FINEMAN: No question. This is --

HAYES: This is --

FINEMAN: Chris, this is the Tea Party -- this is the triumph -- my
headline would be this is the triumph of the Tea Party. And Mitt Romney
was not accepted by the grassroots in the primary process necessarily
because people doubted in places like Iowa, New Hampshire, South Carolina,
elsewhere whether he was a real deal.

What he`s saying with his pick is, I am the real deal. This is who I
really am, and this man can better express it. He`s my like Kemp
whisperer. He is the guy -

HAYES: Kemp whisperer.

FINEMAN: He`s a guy who can express the real --

HAYES: (INAUDIBLE)

(CROSSTALK)

FINEMAN: This guy has actually read Hayek.

HAYES: Right. But here`s the question about the politics of this,
though, because it seems to be to be coming out in some senses -- coming
out of a place of weakness insofar as.

I mean, this week, we had this remarkable blow-up in which Andrea
Saul, the spokesperson for the Romney campaign did something that I thought
was not that noteworthy which was that in response to an attack ad about a
woman dying of cancer after lay-off said, well, in Massachusetts, we passed
this good piece of special (ph) policy then make sure that people are
covered.

And the reaction to that, touting the governor`s signature achieve was
massive, massive conservative backlash. Massive conservative backlash.
And it was in this week that we were reminded once again that the deal was
not closed with the base of the party. I don`t think there`s any way you
can put anything but that after going through this week, Avik.

ROY: I think this choice does really enter --

HAYES: This closes the deal.

ROY: This closes the deal. I mean, as you noted in your opening
segment, Paul Ryan is the leader of the conservative movement. I think
it`s a lot like Reagan in 1976. I mean, it`s that kind of a significant
choice. Paul Ryan`s selection, I think, really does firm up that fact that
he`s really the guy who`s providing the energy, the ideas around
entitlement reform which Mitt Romney has signed on to.

And if you had said four years ago, you know, in the summer of 2008
that in the summer of 2012, we`d be having a serious conservative about
entitlement reform with the leader of that effort in the House being the
vice presidential nominee. It`s pretty remarkable.

FINEMAN: The fact is, Chris --

HAYES: I like to call it social insurgence.

FINEMAN: We have to have that debate. We do have to have that
debate, because the future of the economy --

HAYES: We`ve been having it for two years.

FINEMAN: We have been having it, but we haven`t been having it in
this presidential campaign, which has been about Mitt Romney`s taxes and
about all kinds of other stuff. This choice is going to lead, I think, to
a better campaign, a more substantive campaign and a campaign where we`re
really going to discuss it.

HAYES: First of all, I think we`ve had a pretty substantive campaign.
I mean --

FINEMAN: You have.

HAYES: No, but this week -- the top story that was driving this week
was welfare waivers.

FINEMAN: Right, that`s true.

HAYES: And we were all in the weeds of (INAUDIBLE) policy about
whether welfare waiver the governors have promised to they could increase
like 20 percent the amount of people that can move to welfare work in a
certain amount of time. That was a big -

FINEMAN: -- but I guess my point is a lot of the advertising has been
about things other than that.

HAYES: Sure.

FINEMAN: And that`s what people -- now, wait a minute. That`s what
people in swing states have been seeing in the news that the ads that are
purchased adjacent (ph) to the local news aimed at swing voters. What I`m
saying now is, with the choice of Paul Ryan, those swing voters are going
to hear real debate about whether you want voucher, if you want Social
Security and Medicare to be turned into a voucher program or not.

HAYES: That I agree with, but let me also say this. I think, you
know, in terms of where -- what is the debate about in this moment? He`s
what strikes me as odd. If I were the Mitt Romney campaign, and I`ve said
this before on air, I would get Mitt Romney -- this will probably turn off
some voters but might, I think, ultimately can do (ph) as benefit.

I would get a tattoo of the unemployment rate on my forehead. OK?
And I would just go everywhere. I wouldn`t even speak. I would just show
up with eight percent just tattooed in like a gang symbol and that -- going
to be the way that I would play (ph) around the country.

What Ryan signals to me -- and obviously, Paul Ryan if you send down
says, actually, my path to prosperity is the jobs program because of the
supply side mechanism that have been placed and we`re not medical (ph) tax
rates.

But really, what it really is focused on, it`s trying to focus the
debates squarely in the terms of what are long-term fiscal projections, how
are we going to bend the curve on this physical projection, how are we
going to pay for Medicare or getting rid of Medicare, et cetera, as opposed
to the fact that there is a massive epidemic of human misery in the form of
wasted human capital in the form of human beings who can work and are able
bodied sitting on the sidelines and not doing anything. And if I were
running against Barack Obama, that would be --

FINEMAN: But Chris, the thing is, I think what the Romney campaign
saw here is they made their decision is that the eight percent tattoo thing
wasn`t really working because the Obama campaign had quite successfully
painted Romney into a corner on who he was as a person, what he thought
about wealth the United States, what his taxes were, what he did in his
business.

This is Mitt Romney trying to change the conversation because what he
was doing before hadn`t worked for other reasons. It hadn`t worked because
he wasn`t forthcoming --

HAYES: Do you think that`s true?

ROY: I don`t think it`s an either or. You have to do both. You have
to criticize the president on his record, his economic reforms, and you
have to have a positive forward agenda for what you`ll do when you`re
president. And I think this pick really allows us now to focus on that
second element. What will Romney do if he`s president? What will be his
agenda?

HAYES: But what`s ring (ph) about that is that Romney, we`ve run the
graphs about what the Romney budget -- I mean, Romney has got a budget
proposal. He`s proposed it. In fact, it has very similar distributional
effects to the Ryan budget in terms of people atop getting huge tax cuts,
people in the middle (INAUDIBLE) more tax cuts, and people at the bottom
possibly seeing a tax increase. His vision is not that different.

FINEMAN: No, but it was vague on the question of how he was going to
go after the deficit really. In certain respect --

HAYES: Well, there are $2 trillion cuts of unspecified cuts in the
Romney plan, too. So --

FINEMAN: All right. But Ryan is farther down the road, though, I
think that`s fair to say than Mitt Romney was.

HAYES: I want to bring in Chuck Todd who was one of the folks that
broke the news on this announcement right after we take this break.

(COMMERCIAL BREAK)

HAYES: All right. I want to bring in Chuck Todd, chief White House
correspondent for NBC News and host of "The Daily Rundown" here on MSNBC.
Chuck, great to see you.

CHUCK TODD, NBC NEWS CHIEF WH CORRESPONDENT: Thank you, sir.

HAYES: OK. So, here`s my thought about this as I was blurry-eyed
reading this on my iPhone at two in the morning. You know, what we have
been hearing from the Romney camp was that they had learned the lesson of
game change, they have learned the lesson of 2008, and they have learned
that VP picks represent a lot of downside risk and not a lot of upside
benefit.

And they were not going to make that mistake again by making the VP a
central part of the campaign by taking that downside risk, and this seems
to me to be a pretty strong repudiation of that. At some point, it seems
to me they changed their mind on that.

TODD: Well, I think the political reality changed their mind for
that. I mean, let`s think about when they were leaking that out. That was
six weeks ago. And that`s when it felt as if the race was fairly even.
Yes, the president seemed to be up a little bit, but in the last three or
four weeks, the fact of the matter is, this race -- you know, it felt like
it was opening up.

And what was opening up about it, we can debate the size of the
president`s lead, OK? Nobody seems to be debating the idea that the
president is leading, but what was really clear is that Mitt Romney was
taking on water in his own definition of who he is personally. So, they
had -- then suddenly put more pressure that the VP pick and the convention
was going to serve as a re-launch.

And so, they needed definition. So, I think in a perfect world, they
wanted to be in a position where they didn`t need the VP to be used as a
way to essentially re-launch. They`re, you know, they`re not in that
position. That`s the reality of the moment. And that move things to Ryan.
That said, it should be noted that Governor Romney and Ryan, while they
didn`t have much of a relationship before the Wisconsin primary this year,
they did bond.

There was -- there was an aspect to them that they do like each other
personally. The Romneys and Ryans were able to bond. That does matter in
Romney world, too. You can`t just sort of be connected on the issues, be a
political necessity. You have to sort of be comfortable in that club.

But I go back, you know, he needs to sort of put definition to beyond
being the rich guy who looks out of touch to the middle class. And at this
point, he needed something else. Portman wasn`t going to sort of serve as
a re-launch in that respect. Neither was Pawlenty.

In fact, you could argue that if you named Pawlenty, it actually would
only reinforce Romney`s negatives, right, because everybody would be
talking this morning, well, Tim Pawlenty, he`s there to connect to the
middle class. He`s there to be the blue collar guy which would then say,
hey, that`s because Romney doesn`t --

HAYES: Yes, but on the other side, I mean, what I found from the Ryan
pick from myself was that I actually had been in the somewhat skeptical
camp about the race opening up just because I think, sometimes, you know,
it`s just hard from an analytical perspective to understand when you`re
seeing a (INAUDIBLE), particularly this early out, particularly because
there`s some data that says basically everything before six weeks is not
super predictive, right

This, to me, confirms that the race was opening up and that my own
skepticism about it opening up was wrong. That they really -- they see it
opening up at least.

TODD: Well, and it`s where it was opening up. I mean, you know,
sometimes, what we don`t do as well when we cover national polls, when we
cover polling in the media is that we spend a lot of time in the horse
race, maybe go into some internals quickly and then move away.

But it was the stuff that both the campaigns were seeing, that Romney
was just getting to find -- you know, they -- both campaigns do something
very interesting. They -- each night or -- every couple of nights, when
they do their poll, they ask what`s something you`ve heard or seen about
the candidate.

FINEMAN: Right.

TODD: And I can tell you that it`s my understanding that there are
pollsters in both sides of the aisle that when they`ve been in these
battleground states, all that they`ve been getting back, even though the
Republicans are outspending the Democrats over all, all that they were
getting back upon Mitt Romney were negative descriptions from Obama
campaign ads.

It was working. The Obama campaign had -- was definition and the
attempt to define and take over Mitt Romney`s biography was working. So,
they were in a position. They needed to do this. I talked to some
Republicans. I said, what do you need out of this pick? What do you hope
the Romney campaign does?

And they said, well, for Romney`s concern, you know, need some
excitement and need some clarity. And that`s what this gives. But, Chris,
I want to bring up something else.

HAYES: Sure, please.

TODD: When you look at the presidential nominees at this stage that
felt that they needed to use the vice presidential candidate to re-launch,
I think Al Gore, I think Bob Dole, I think -- you could go back -- Walter
Mondale. It doesn`t -- you know, where they wanted the VP pick to be
basically as big as they are and help re-launch, it didn`t end well.

HAYES: Right.

TODD: OK? When you look at the candidates that win, whether it`s
Obama, Bush, Clinton, and Sarah Palin obviously the most obvious example --

HAYES: Right. Right.

TODD: Even Reagan. Remember, there was a lot of pressure on Reagan
in 1980 to pick the Paul Ryan of 1980 --

HAYES: Right.

TODD: Gentleman by the name of Jack Kemp.

HAYES: Right.

TODD: He didn`t. He said no. I`m the change. I`m going -- I`m
going to go bland. I`m going with H.W. bush.

HAYES: Right.

TODD: It is, you know --

HAYES: That, I think, also points to this dynamic that you`re talking
about which is than Reagan was the hero to the right and had the latitude
to make that decision in a way that, you know, Mitt Romney clearly is not.

FINEMAN: Yes. In that sense, this reminds me -- when Chuck said that
his sources on the Republican side said we need some excitement and
clarity, I think Chuck and I know that in St. Paul, Minnesota, that`s what
everybody was saying about Sarah Palin.

HAYES: Right.

FINEMAN: That she provided excitement in the hall and clarity. It`s
a similar situation where you have the somewhat muddy, ideological front --
the top of the ticket. And you need somebody sharply conservative on the
second level. That`s exactly what`s happening here, although, Paul Ryan is
much more substantive figure than Sarah Palin.

HAYES: Yes. I mean, when you talk about this, because -- I mean, the
weird thing here, right, is that there`s a policy record of Mitt Romney,
OK? The guy was governor of a state and did lots of stuff. I mean, I
found out the other day that they increased fees on people who are getting
a card certifying they were blind in Massachusetts like $15, OK?

There`s -- I mean, you know, that`s not the purposes of national
policy debate, but there`s a policy record. And you know, if I were Mitt
Romney, I think I`d be a little insulted when my advisers come to me and we
want this guy (INAUDIBLE). He`s in the weeds. He`s going to provide
clarity.

He was the governor of a state, but of course, he painted himself into
the corner because he never talks about being the governor of that state.

ROY: No. I don`t think he`s painting himself into a corner at all.
I think the real significant thing that I think went underemphasized at the
time was in the primary -- in the primaries this winter. A lot of people
were saying, a lot of conservatives were saying, well, which of these
nominees are going to come out and support the Ryan plan.

And Mitt Romney said, I believe in the overall concept of the Ryan
plan, but my plan is going to be different. And everyone`s like, what does
that mean? And then, Romney came out with this plan which borrowed some
other Democratic ideas from Medicare reform but actually had a lot of
policy appeal.

And what happened then, a few weeks later, Paul Ryan announced that he
and Democratic senator from Oregon, Ron Wydon, had come up with an exactly
the same plan or very similar plan --

HAYES: You`re claiming the scoop for Mitt Romney.

ROY: Well, no. I`m just saying that this is when the policy alliance
between Paul Ryan and Mitt Romney was cemented. And a lot of people --
this is also something that`s not as well known is that a number of -- when
the nomination was wrapped up or when the contest was wrapped up, a number
of Paul Ryan staffers moved to Boston to join the campaign.

The guy I report to is an ex-Paul Ryan staffer. So, there`s been a
lot of policy for a long time, you know?

HAYES: We`re going have the one and only Rachel Maddow joining us in
just a moment. Chuck, if you would stick around, that will be great. And
we`re going to talk more about the announcement of Paul Ryan, congressman
from Wisconsin, as the vice presidential pick of Mitt Romney right after
this.

(COMMERCIAL BREAK)

HAYES: I`ve just been told I don`t have a Rachel Maddow intro in the
prompter. So,. I`m freezing up.

(LAUGHTER)

(CROSSTALK)

(LAUGHTER)

HAYES: Joining me now, what a great pleasure to have Rachel Maddow
here early this morning. I just said, ironically, you told me last night
when I was on your program, to go home and get some sleep.

RACHEL MADDOW, HOST, "THE RACHEL MADDOW SHOW": Yes.

HAYES: And here you are.

(LAUGHTER)

HAYES: Early in the morning.

MADDOW: I`ve been up ever since.

HAYES: Yes. Exactly. It`s great to have you here. What`s your
reaction to the pick?

MADDOW: There are some obvious winners from this pick. Obviously,
the right is very excited. Paul Ryan is a controversial pick in the
country at large. On to right, he is not controversial at all. So, to the
extent that Mr. Romney was at all concern about being seeing somebody who
had a hard time standing the (ph) pressure from the right, this compounds
that problem.

HAYES: Right.

MADDOW: So, the right is very excited. Obviously, Paul Ryan is very
excited. The P90X people, I`m sure, are very excited. He is the poster
child for P90X, which is most of what Politico.com writes about him.

HAYES: He is fit and trim.

MADDOW: Yes, exactly.

HAYES: Which I admire.

MADDOW: Democrats are very, very, very excited about this. I mean,
David Plouffe was trying to hang Paul Ryan around Mitt Romney`s neck
starting back in March when he started the Ryan/Romney plan or the
Romney/Ryan plan framing. I mean, he`s been used as a cajole (ph) against
Mitt Romney already.

And so, for them to have accepted that and said, OK, to run on what
Ryan is famous for other than P90X is a real gift to the Democrats.

HAYES: Chuck Todd, is that -- that`s my sense as well. The democrats
are excited about this pick that I think it`s a galvanizing, exciting pick.
I mean, I don`t think there`s anyone -- maybe there`s some crazy apple (ph)
on Ron Portman I`m not familiar with, which is possible.

TODD: Sure.

HAYES: But it strikes me that there were a ton of democratic
operatives salivating over the prospect of Rob Portman in their sights, in
the way that they were over Paul Ryan.

TODD: No. And in fact -- I mean, to emphasize Rachel`s point, I
mean, it`s my understanding that the way the Obama campaign was set up, you
know, they were going after Romney and the summer, and then, they wanted to
figure out how to tie Romney to the House Republicans and the Ryan plan in
the fall.

Well, Romney did it for him by picking Ryan. Now, there`s a lot of
Republican strategist who, this morning, who have clients, that are helping
clients to try to get re-elected in House races and senate Races who are
very nervous this morning. They`re probably the one group of folks not
very happy.

They`ve been trying to come up with ways to distance themselves from
the Ryan budget, because this Medicare staff. You know, I look at two
Senate races that I think and I would point a lot of folks to go watch the
Senate races over the last couple of weeks and watch to see what happens
are sort of the Petri dish (ph) on Medicare.

HAYES: Yes.

TODD: And that is a Senate race in Montana where the Republican --

(CROSSTALK)

TODD: -- has been running ads against the Ryan plan. He voted
against the Ryan plan. Then you have a neighboring state of North Dakota,
Heidi Heitkamp (ph), who basically is in the game because she`s been
hammering her Republican opponent who is also a sitting House member, Rick
Berg (ph), for voting for the Ryan Plan.

So -- and she`s in the game in a so-called red state because simply of
one issue, Medicare. So, you know, that`s the other aspect of this pick is
that it gives some clarity to the debate, but it gives charity all the way
down the ballot.

HAYES: Right.

TODD: Like, this is one of those rare occasions where -- what the
House candidates are going to be talking about, both Democrats and
Republicans, what the Senate candidates are going to be campaigning about,
all of it is the exact same thing as what the presidential candidate.
There`s no sort of distancing yourself from your presidential candidate
much, much harder now.

HAYES: And to me, what it also reaffirms is the increasingly, for
lack of a more accurate, description of the parliamentary nature of both
American politics at this moment but also Republican Party institutionally
which is increasingly governed from the House. I think that dates back to
Gingrich what was very true in the delay years and is very true right now.

FINEMAN: Can I say I think that`s exactly right, and I think its
whole election really has struck me as a parliamentary election in the
sense that we sort of know what the issue and the objective is which is
who`s going have the high ground in Congress in the lame duck and in the
early portion of next year to decide these fundamental issues about
entitlements and taxes.

HAYES: Yes.

FINEMAN: We basically know what the issue is, and it`s been a battle
for control of the -- who has the upper hand and that`s going to -- this is
going to clarify the nature of that for sure.

(CROSSTALK)

TODD: You know, one of the biggest things --

HAYES: Hold that thought for one second. I want to take a break and
continue this conversation. Chuck, I think we can keep you there for a
little longer if that`s OK with you and we`ll be right back after this
break.

(COMMERCIAL BREAK)

HAYES: All right. We`re discussing, obviously, the big new this
morning which is that Mitt Romney will be naming Wisconsin Republican and
chair of the House Budget Committee, Paul Ryan, 42-year-old, seven-term
congressman from the Janesville area of Wisconsin near Kenosha, not too far
from Chicago.

That announcement is going to happen live. We will be taking that
live here at 9:00 a.m. I have at the table Avik Roy, Howard Fineman, and
the one and only, Rachel Maddow.

We`re talking about the nature of the Republican Party being kind of
increasingly parliamentary party, increasingly a party in which the House
of Representatives, particularly, sort of set the agenda for the party and
people vote as a block as they would in a parliamentary Democracy, right?

If you`re a member of the party, you go along with the party. You`re
not making these individual calculations about, oh, I represent this
district, which has a lot of Medicare recipients. No. You vote for the
Ryan budget, and that exposes, I think, some political, you know, cause for
Republicans and you and I have talked about this a lot about what the cost
of that are.

MADDOW: The problem, I think, is two fold for that, for this as a
choice for Mitt Romney. And in part of that is that, this is also the most
unpopular Congress in the history of polling on the popularity of Congress.
I mean, everybody says, oh, Congress is very unpopular. It is
unprecedented that it has ever been this unpopular.

And so, to bring somebody from the very unpopular House Republican
caucus and put them on the ticket brings that onboard to the Romney
campaign. But the other part of it is the one thing that Paul Ryan is
famous for which is the budget and the one part of the budget that is
famous which is privatizing Medicare, turning Medicare into a coupon system
or voucher system, instead of what people think of as Medicare and the
Medicare as we know it.

He`s the kill Medicare guy, and that won a lot of elections, special
elections for Democrats, especially at the time that republicans were
voting on that. And that just becomes -- it`s now a choice election
instead of a referendum on the president. It`s now kill Medicare or the
president.

FINEMAN: It allows -- yes, go ahead, Chris.

HAYES: Well, there`s also the argument that -- I mean, from the
political standpoint when the "Wall Street Journal" wrote their editorial
is -- there was actually a relatively decent political point there which is
the budget is going to be hung around your neck anyway, you might as well
get the guy who knows it best to defend it on your ticket.

I mean, I don`t think that`s a crazy idea. I mean, they wanted to
hang that budget around them, and he had endorsed the budget. Everybody
knows -- I mean, Grover Norquist got up at CPAC in February and literally
said, we don`t need a fearless leader, we need a president with, quote, "I
think enough working digits to sign the Ryan budget."

We don`t care what stooge (ph) we put in the oval office. All you
have to do is have an autopen. And so, you know, that budget was going to
-- they were going to own that budget whether Ryan was on the ticket or
not.

FINEMAN: Yes, but what impresses me here is that the president,
because of the Ryan budget, because of what the Republicans in the House
had done, the president and his advisers are now running, decided to run
and are running quite effectively when they aren`t attacking Mitt Romney`s
character.

They`re running as defenders of Medicare, Social Security, all the
rest of the sort of great society and new deal architecture that the
Democrats for two generations built up.

ROY: Defenders of the status quo.

FINEMAN: Well, I know. But that`s true. In that sense, they`re
saying, look, the economy is tough, the world is tough. The last thing
we`re going to do is not defend Medicare, social security, education money,
loans, all the architecture we are defending. So, the president is now
running that type of campaign.

It`s an old-fashioned Democratic campaign that could very well work.
And to your point about parliamentary, it`s not just that the house is
important. It`s that this whole presidential election is about what`s
going to happen on budget and taxes.

ROY: Yes. Let`s not forget the Senate either. We haven`t really
talked about the Senate. Chuck Todd talked about a little bit in his
segment. I mean, the Senate is going to be critical. It`s not a walk in
the park that we all thought a year or two ago that Republicans really had
the edge in the Senate because of all the Democratic seats that were up.

We don`t know based on some of these races in the Dakotas for example,
we don`t know what`s going to happen. So, I think, if Republicans don`t
win the Senate, they`re not going to be able to pass a lot of their -- even
if Ron Wyden (ph) and some other centrist Democrats vote for.

MADDOW: I do think it`s interesting, though, that some of the reasons
that the Senate looks much more competitor for Democrats, favorable to
Democrats than it did before is because votes for the Ryan venture (ph) or
positions in the favor of the Ryan venture (ph) are being hung around
Senate candidates` necks even though that`s the document that are
originated in the house.

(CROSSTALK)

FINEMAN: -- some candidates and some places are defending the Obama
healthcare plan. They`re going on the attack defending the Obama
healthcare plan against Republicans. That`s happening in North Carolina.

HAYES: I want to do two things. I want to burrow in a little bit
substance of what the Ryan budget is. We`ve been talking about politics,
what it actually does? Will is solve the country`s fiscal problems, A?

B, I also want to just raise a point about the kind of way in which
this election has been pitched, particularly, by conservatives, by Paul
Ryan, by the "Wall Street Journal," by Mitt Romney, as a grand ideological
choice about the size and role of government. And I don`t think that`s
true. We`ll talk about that and we`ll bring in Ezra Klein right after
this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GROVER NORQUIST, PRES., AMERICANS FOR TAX REFORM: We know what
direction we want to go. We want the Paul Ryan budget. We just need a
president to sign this stuff. And the leadership now for the modern
conservative movement for the next 20 years will be coming out of the House
and the Senate.

Pick a Republican with enough working digits to handle a pen to become
president of the United States.

(END VIDEO CLIP)

HAYES: All right. Welcome back. I have now joining me at the table,
Melissa Harris-Perry. It is so wonderful to see you this morning.

MELISSA HARRIS-PERRY, MSNBC HOST, "MELISSA HARRIS-PERRY": Very nice
to be back it up.

HAYES: I miss you. I miss you on my show, because you have your own
show now. And so --

(LAUGHTER)

HAYES: --the other table. And we also have, if I`m not mistaken, we
have Ezra Klein from Washington D.C, MSNBC contributor.

(CROSSTALK)

HAYES: What`s up Ezra? Good morning.

EZRA KLEIN, MSNBC CONTRIBUTOR: Good morning.

HAYES: All right. So, we talked a little bit about the politics of
the Ryan budget and the centrality of the Ryan budget now achieves in this
elections, which I think was already fairly essential but now is
indisputably central. Ezra Klein, you have spent more than a little bit of
time on the Ryan budget, talking to Paul Ryan, looking at the facts and
figures.

Does the -- what does the Paul Ryan budget do in sort of simplest
broadest strokes?

KLEIN: OK. There are two things here that are important to separate
those. What the Paul Ryan budget does and then what it says it does,
because these are actually very different things in important ways. So,
the big things a Paul Ryan budget actually does are -- that it specifically
can tell you it does is, one, it changes Medicare dramatically.

The first iteration of the Paul Ryan budget in 2010, I believe,
essentially eliminated Medicare`s traditional option, what everybody --
what most everybody in Medicare is in now completely. And it moved into a
voucher program. You get private insurance and the way they were going to
save money was they`re going to get seniors a check (ph) to get that
private insurance, but the check was going to grow at a very slow rate.

HAYES: Right.

KLEIN: A year later, the backlash is too big on that. They ended up
with this new thing which is called Ryan-Wyden which Mitt Romney also
supports. You can also choose Medicare, the normal one, in addition these
private options. The check now gross somewhat less slowly, but you`re
trying to transition it over to a private system. The other big thing it
does is it is a sort of Romney-like tax reform.

It does a fair amount of cutting across the federal budget, although
it increases defense spending in certain ways. But what`s also important
about it and the thing that is really fundamentally radical about it is
what Paul Ryan told you it does in terms of where federal priorities go.
He says that in 2015, every single thing the federal government does that
is not Social Security, Medicare, and Medicaid will take up 3.75 percent of
GDP.

Now, that means everything, food safety, defense, education,
infrastructure, roads, everything you can think of, so not a major social
insurance program less than four percent of GDP. The way you know that
can`t be done is that Mitt Romney has said that he will never let defense
spending alone get under the four percent GDP. He will set a floor on
that.

(CROSSTALK)

HAYES: What if you have negative .25 percent of GDP in social program
in which you force poor people to pay into the treasury that it worked.
Remember, numbers --

(CROSSTALK)

HAYES: Melissa Harris-Perry, this raises something that will not be,
I think, at the center of the debate, frankly, because of the way debates
work, which will be about middle class entitlements, but a huge part of
what the Ryan budget is is going after things that benefit largely the
poor. In fact, Center for Budget Policy Priorities estimates that two
thirds of the cuts come from programs to the poor.

Looks to cut Medicaid spending by about a third, which is a tremendous
amount. What impact do you think that has? Do you see that figuring in
the campaign? That`s, I think, a really interesting open question.

HARRIS-PERRY: Yes. I mean, I think the only way it figures in the
campaign is if President Obama decides and the Obama campaign decides that
they`re going to distinguish themselves from their opponents on this issue
of how they`re going to address the most vulnerable Americans.

Are they going to say, look, what the Romney pick is is the decision
to say the only way that we believe we can get out of economic crisis is by
balancing everything on the shoulders of those least able to carry the
burden. And, we believe that because these will be the most
disenfranchised individuals going into -- into not only the 2012 election
but sort of in the long tell term.

So, basically, making a political calculus that says it`s OK for us to
go after their economic, social, health, education security, because they
won`t be able to fight back at the ballot box. That`s just basically the
way that poor people and relatively less empowered people have managed to
fight back is what the one man-one vote (ph).

ROY: We`re neglecting some pretty significant elements of all this.

HAYES: Please.

ROY: I mean, for one, the affordable care act cuts Medicare more than
the Wyden-Ryan budget does. So, the affordable care act cuts Medicare by
$750 billion over the next 10 years. It affects existing retirees, and it
grows Medicare GDP at plus .5 percent. The Wyden-Ryan budget also grows
Medicare GDP plus .5 percent for people under the age of 55 that leaves
Medicare unchanged with people above 55.

HAYES: Right. The Medicare, two points about that. I`m glad you
brought that up. A, the Medicare cuts are on the payment -- the government
payment to insurers, right, rather than on the customer`s side, right?
Rather than on the patient`s side.

ROY: So, let`s have that debate. Let`s have the debate about how we
should reform Medicare --

(CROSSTALK)

KLEIN: Ryan keeps the Medicare cuts. It is budget. He keeps the
affordable care act`s Medicare cuts. So, he`s adding this. And I`m not
saying it`s a bad thing. Him, and as Avik says, him and President Obama
have the same growth cap (ph) on Medicare. They get it in different ways,
but they keep the cuts. It`s not like he`s repealing those cuts.

HAYES: I mean, this is a very important ideological bedrock here,
because I`m glad you said that, because we forgot that the Tea Party came
to power running against the Medicare cuts, the $500 billion in Medicare
cuts that were embedded in the affordable care act.

Pause that for a second because I want to bring in Andrea Mitchell who
is on the scene right now, MSNBC news chief foreign affairs correspondent
and anchor of MSNBC`s "Andrea Mitchell Reports". Andrea, they`ve gotten a
big crowd together in a very short amount of time.

ANDREA MITCHELL, MSNBC NEWS: They started working on this yesterday
morning according to the local advance people. They clearly knew that this
was supposed to be the rally, the kick-off to the bus tour, but then it
became so much more. Right now, behind me, you can see former Governor
George Allen.

He is involved in a very tight Senate race here against another former
Virginia governor, Tim Kaine, who was also, of course, the former DNC
chair, Democratic National chair. And this is part of the reason why
Virginia is so important. This Senate race is as close as can be, and this
is a military area, of course, Norfolk, the navy base, and this is going to
be a very favorable area.

One to the bus tour (ph), but also, we understand that Paul Ryan and
his family will be here, of course, for the kick-off. We`ve got a couple
of indications of what he`s going to say from the campaign. He`s going to
say that Governor Romney is the man for the moment, and that together they
can restore the dreams and greatness of this country.

He`s going to talk about how proud he`s been to represent Wisconsin.
And he`s going to talk about the challenges that lie ahead. You guys have
been talking about the contrasts here, the contrasts that not be more clear

One of the things that we talked about earlier is that they`re going
to right away have to confront the Medicare issue, the Medicare cuts that
the Congressional Budget Office say would take place in the Ryan budget.
And already, I`ve seen a tweet just now from Marco Rubio who, of course,
was passed over for this job.

And Marco Rubio, one of the big stops on this -- coming up on this
(INAUDIBLE) in Florida is tweeting that when will Barack Obama save
Medicare because it will be bankrupted if something isn`t done. So, that
is likely to be their line of defense, and it`s going to be a tough one to
fight on Medicare going into an older population in Florida, Chris.

HAYES: Andrea Mitchell live in Norfolk. We will be coming back to
you as we watch this unfold. We`re scheduled to hear from both men very
shortly. Thanks so much. We`ll be right back.

(COMMERCIAL BREAK)

HAYES: All right. We`re back discussing the big news this morning.
We have imminent announcement of Paul Ryan as a vice presidential choice of
Mitt Romney on the Republican ticket. We`re talking about the Ryan budget,
and we started to get a little bit which I delight in into the weeds of
what it looks like in terms of Medicare.

And you made this point about the cuts to Medicare that are already in
the affordable care act, right? I think that`s -- the reason that I think
that`s a really key point is, A, people forget how sensible (ph) were in
the political argument that folks who were elected as essentially Tea Party
insurgents used in running against the affordable care act.

The one line distillation of why the affordable care act was bad in
swing districts around this country in the election 2010 was that it cut
Medicare. And the reason that`s important is because there seems to me
this desire on the part of Mitt Romney, on the part of Paul Ryan, "The Wall
Street Journal," and even in some ways of the Democrats to talk about this
election as this grand battle of competing visions, about how big
government is going to be.

And there is, zero, zero evidence the Republican Party is committed to
cutting government in any way. It is a question of who that government
benefits. Government as percentage of GDP did not go down under Ronald
Reagan. Government as percentage of GDP did not go down under George W.
Bush and Tom Delay when they add all three branches of government.

And Paul Ryan was sitting there along with Rick Santorum tomorrow,
voting time and time again for things like, for instance, the Medicare part
D prescription drug benefit. A completely unpaid for new very costly bit
of social insurance that Paul Ryan cast the deciding vote for because it
passed by one vote in the House.

So, the idea that before we even get to the question of which vision
of government do we want to choose between this grand ideological - Ayn
Rand here and some, I don`t know, collectivist strawman here, I just refuse
to concede (ph) the premise that the Republicans are interested in cutting
government because there is no record that they are.

ROY: I think the premise that you mentioned is precisely why the Paul
Ryan pick was so important, right? Because there was a demand for let`s
have that argument. Let`s have an actual agenda that does attempt to get
the fiscal situation under control. And it was the great frustration of
the conservative base that that wasn`t true --

(CROSSTALK)

HARRIS-PERRY: I don`t think it`s about getting the fiscal situation
under control, but I do think -- I agree with you politically that it`s
about saying, OK -- you know, when I start to look at this, why do you pick
a VP who`s from the Midwest if you`re from the Midwest? Why do you pick a
VP who`s an econ guy if you`re the econ guy?

What deficit is it that he is filling for you as the principle on this
ticket? And the things, to me, the answer is an ideological core.

HAYES: Yes.

HARRIS-PERRY: That what Mitt Romney does not have, what he is unable
to do in a debate with President Obama is saying, you know what, I am
against single pair. No, really, you`re not, because you two work for an
individual mandate, right?

There are a variety of things where he, just over and over again, is
on both sides of them on the record, right, in the matter of governing.
But on this question, with his VP and the decision to pick him, he chooses
an ideological position whether or not it is empirically accurate.

MADDOW: Yes. The empirical accuracy of it is exactly the point.
Look at the stage set right now. Look where they`re going to announce
this. It`s a warship --

HAYES: Thank you. Yes. Thank you.

MADDOW: Covered in (INAUDIBLE). So, the part of the tell on Paul
Ryan in terms of whether or not his ideological brand matches what he wants
is that what he has proposed, his current budget, calls for a massive
increase in defense spending. We`ve already doubled defense spending since
2001, and we`re growing form there.

He`s calling for an increase -- farther increase in defense spending,
and they`re going to make the announcement of him in front of a warship and
while saying the brand here is spending restraint.

HAYES: Not only that, the budget right now as currently proposed and
the activity of House Republicans and Senate republicans among them, John
McCain, is they are doing everything in their power to extricate themselves
from the cuts that were agreed to as part of the sequester as the thing
that would impose for slightly the physical discipline that we`re told is
lacking, right?

The idea was fiscal discipline to flocking (ph) the Washington. We
will bind ourselves to the mass of fiscal discipline, and we will do so by
making sure that each limb is going to be cut off, right? Something for
the Democrats, something for the Republicans. You will lose your social
services.

We will lose our defense cuts, and now, they are in the process of
undoing that deal. The point to me is if the most recent deal that was
made to preserve fiscal discipline and shrink the deficit, can`t it last
two or three months, because it`s being undone by the very same protagonist
who tell everyone that they are the ones who were going to be the vanguard
of fiscal discipline?

Why we should we trust them? Why should we trust the Republican Party
to produce fiscal discipline that it has not produced in the past?

MADDOW: And why are we subject to such lame beltway media branding on
this subject that Paul Ryan is the serious fiscal conservative spending
restraint guy? Why does that brand persist in the face of the empirical
evidence of what he`s actually proposing?

HAYES: Ezra, do you think --

KLEIN: The lame beltway media here?

(LAUGHTER)

HAYES: You beat me to the joke. I was actually just going to throw
to you on that joke. Yes.

KLEIN: As ambassador for the lame beltway media sitting here in
Washington D.C. --

HAYES: Wait, actually, hold that thought. We have a break. I want
to hear from the lame beltway media right after this.

(LAUGHTER)

(COMMERCIAL BREAK)

CHRIS HAYES, HOST: Good morning. I`m Chris Hayes. We`re awaiting
Mitt Romney`s vice presidential announcement, which is happening in
minutes.

Right now, I`m joined by Rachel Maddow, host of "THE RACHEL MADDOW
SHOW" on MSNBC, Avik Roy, health care policy adviser to Mitt Romney, and
Melissa Harris-Perry, host of MSNBC`s "MELISSA HARRIS PERRY." We also have
a member and good standing of the lame Beltway media, Ezra Klein, who is in
Washington.

That`s a call back to your joke before the break, if you`re joining
us, in which Rachel --

(LAUGHTER)

EZRA KLEIN, MSNBC POLICY ANALYST: It`s true as well.

HAYES: We were talking about -- we`re talking, obviously, about the
fact that Paul Ryan is about to be announced as the vice-presidential
nominee for the Republican Party or not officially nominee. And we were
talking about the fact of whether we`re going to have this election to
grand battle of visions about the size of government -- particularly I`m
making case that even if that`s what people say it is, there is no record
of the Republican Party really cutting government in any significant way.

And, Ezra, you wanted to pipe in on that.

KLEIN: Yes, I want to comment on that all the excitement. Look,
Romney and Ryan clearly want to increase defense spending and they want to
do a tax cut that`s probably going to explode the deficit or almost by a
matter of math, significantly increase taxes on the middle class. So,
there`s a lot in that promises that don`t add up.

But I do think it`s fair to say that this period has been
radicalizing for Republicans in a very particular since which is that faced
with needing to come up with an economic theory of why the Bush years went
so wrong, and how -- and what to do about the economy right now, the basic
period they have settled on is massive cuts to social insurance programs.
And Ryan and the Republicans in the House have demonstrated a real
willingness to sacrifice on that.

I mean, we can`t say, on the one hand, the Ryan budget is this
basically dangerous, politically toxic document that they all voted for
multiple times now, and on the other hand, they have shown no willingness
to take the heat for it.

And one thing that I think we also need to say here, you mentioned
programs to the poor a few minutes ago. What we haven`t talked about is
that Romney has actually moderated significantly his cuts to Medicare, his
cuts on Social Security. What he has done, though, is put forward and so
has Romney, incredibly draconian cuts to Medicaid, to housing security, to
food stamps. What he says he`ll a block and turn it over to the states,
which is way of hiding a massive cut on all those programs, saying state
innovation will take care of it.

So, what Republicans have been willing to vote on here is a massive
cut in the size of the social safety net for the poor. And that really is
big and it`s much bigger than anything we`ve seen in recent years. And
both Romney and Ryan have been on lockstep on it. It`s the only thing
Romney has actually identified as cuts he would make.

HAYES: Let me just -- to further -- I just want to show Paul Ryan`s
record. OK. So Paul Ryan is actually a sitting member of Congress. He`s
a seven-term congressman. He`s not just a guy who writes manifestos. He
takes vote.

And this is the record on his votes, OK? Voted for the Bush era tax
cuts, which cost about $1.7 trillion. Extend the Bush era tax cuts, $620
billion. The actual disbursement that came out of TARP, even though the
number was, it was $224 billion, voted for that. Voted to authorize
military force in Iraq, which us about $853 billion. And voted for
Medicare Part D, which is $180 billion.

Those are his votes. We`re not even talking in the abstract. I
mean, Paul Ryan was sitting there during that period of time making those
votes. And I think what drives people crazy is the sense that, you know,
you burn the house down and now you`re complaining about there being no
house, right?

I mean, it was the Republican Party that oversaw the massive increase
in deficits. It was the Republican Party that oversaw the deterioration,
if you believe there`s a deterioration of the country`s fiscal situation.
And now, the same people, literally the same person sitting the well of the
House is going to use that as a way he wants to get elected.

MELISSA HARRIS-PERRY, MSNBC HOST: Before we went to break, you and
Rachel were saying why should we believe them, right? And you just keep
saying, why should we believe them? And I think the real question is,
who`s the we? Who`s the we that is meant to believe that it`s an
ideological pick, that this is someone who is about fiscal discipline? Who
is the we?

And the fact is, do we believe them? No, right, because we look at
the empirical evidence of the actual vote, which clearly increase deficit.
But what`s going to happen is the story`s going to be this -- you don`t
need a social safety net for the poor if you create jobs.

HAYES: Right.

HARRIS-PERRY: The single best safety net for a poor person is a job
with good income.

So, this is going to be the story line, right? They`re going to say,
what we`re going to do is we`re going to cut taxes on job creators, job
creators will create jobs, you will be able to go to the grocery store and
buy food with your wages. You won`t need the food security programs.

That`s the story, right? And the reason that works so beautifully is
because they`ve been winning this ideological battle with a "we" that is
not "us."

AVIK ROY, ROMNEY ADVISER: And the other thing to mention also, is
that, let`s not forget, what`s the alternative? If what Howard Fineman
said, the alternative is a reactionary Democratic campaign where there`s no
reform of these entitlement programs. We see it in Europe --

(CROSSTALK)

HAYES: You cannot say seven minutes ago in the program that Barack
Obama cut $750 billion out in Medicare and seven minutes later say it`s a
defense of reactionary --

ROY: Leaving that aside. The broad structure of entitlements aside
that from point, keeping the status quo entirely, we`re adding a lot of
spending, it`s not just for cutting Medicare with the Affordable Care Act.
There`s a lot of new spending associated with that.

So, it`s not like there are some sort of massive deficit reduction
that comes from that program, there`s going to be a lot of spending -- the
spending trajectory, if that continues as it is, what happens? Who`s that
going to affect? That`s going to affect the poor. If we don`t reform
Medicare so that it`s sustainable for the future, who are going to be
people vulnerable? It`s going to be poor seniors.

(CROSSTALK)

KLEIN: The spending trajectory as it currently exists, you said a
few minutes ago and you`re correct, that both Paul Ryan and Barack Obama
have the proposed the precise same spending trajectory for Medicare. GOP
for Medicare --

(CROSSTALK)

KLEIN: And they want to get it in different ways, right? Barack
Obama has this thing called Independent Payment Advisor Board. It would
speed up the way your reform Medicare. It would do a lot of the payment
side.

Paul Ryan wants to turn it into a voucher program, where people would
have to pay more, to have traditional Medicare, that doesn`t prove to be as
cheap as the private options.

Those are different visions and we can debate them. But they are
different vision between ways to reform Medicare.

This thing that Democrats have not actually put forward a plan to
reform Medicare, that entitlement, it`s a myth. You can sort of switch
back and forth between it when it`s useful to them.

RACHEL MADDOW, MSNBC HOST: The attack is Democrats want to do
nothing about these out-of-control entitlements, and Democrats are
drastically cutting these entitlements, which doesn`t make any sense.

I mean, the only reason that you got any of the type of defense that
Howard Fineman was talking about of Medicare and Social Security is because
the Paul Ryan plan exists and was voted on by Republicans in Congress.

And if you -- find the nearest old person and ask them, do you like
Medicare? Would you like Medicare to instead be replaced by a coupon and
prayer and your wish and your -- and a message that you should go try to
buy insurance in the private market. And then, you will get a robust
defense of Medicare from that old person and from the Democrats you stand
with.

ROY: Right. But, of course, the Paul Ryan plan does not change
Medicare for anyone over the age of 55. On the other hand, what the
Affordable Care Act --

MADDOW: So, ask a 54 year old.

ROY: -- ask seniors if they want, a board of 15 government officials
to tell them what services they can and can`t have it on Medicare program.
That will be pretty unpopular, too.

MADDOW: Because there`s no restrictions now on what you can get on
Medicare?

ROY: But there will be more.

(CROSSTALK)

HAYES: Either we`re cutting cost or we`re not. This is what is
frustrating about this debate, right? I mean, the point is if -- what
you`re sort of saying what`s on the table and stipulate to, OK, so we can
find the points of disagreement.

What`s stipulated to I think is that the thing -- when you look at
the long-term physical scenario of the country, the single element of the
federal budget that is scariest is Medicare, OK? Medicare or Medicaid, but
really Medicare. And that`s combined at two things, the fact that health
grows at a rate that`s far above inflation and the fact that the population
age, when you put those two things together, you get Medicare eating more
and more of the federal budget, right?

So, the question about this long terms fiscal trajectory ends up
being about what you do about that, that projection and there are different
ways you can go at it, right? There`s the idea you have as in the
Affordable Care Act, the Independent Payment Advisory Board, looks at
evidence-based science and says these kinds of procedures work, these
procedures don`t work, or we`re going to incentivize hospitals to do
preventative so they keep people out of the hospitals, et cetera, et
cetera, ways to bend cost curve.

Or there`s that you push people into the private market. You get
them -- you restrain the spending based on what the money you give them is
and then that gap creates this essentially competitive -- choice in
competition.

I just want to be clear what we`re debating here. But the point is
if we`re ion the world of debating what we do about Medicare and then what
happens is the politics flip based on what`s convenient --

ROY: That`s a fair fight. I think that`s a fair fight for
conservatives to make the case that choice and competition is better than
government-driven decisions.

HARRIS-PERRY: But that will not be the debate that will occur on the
stage between President Obama and Governor Romney, or between Ryan and Vice
President Biden. The debate is going to be, as Rachel framed it, ask the
54-year-old, do you want Medicare to exist in its current form? Do you
want it to exist in this form or in that form? That`s the story.

HAYES: The debate is going to be -- in the words of Paul Ryan -- the
battle between individualism and statism -- as if the difference between
GDP percentage, federal government GDP percentage 17 percent or 19 percent
or 21 percent is the difference between individualism and statism. It just
isn`t. It`s the question of who`s going to benefit at the margins. You
know, there`s millions of people who are on Medicaid and Medicare. That to
me is the question.

It isn`t like we were having -- we`re not choosing between, you know,
these massively world views.

Ezra?

KLEIN: I would predict, too, that this debate is going to continue
actually about taxes, because when they get up on that stage, that thing
that`s going to happen here and the problem for Mitt Romney and Paul Ryan
because they got this tax plan that appears to give large tax cuts to the
rich and no way to pay for it is why are you making these very difficult
cuts to Medicare, which as Avik points out have real implications? Why are
you making them and then giving all of this money to rich people with the
cuts you just made to Medicare?

That is the thing people can`t stomach, particularly in the Ryan
budget. Everyone is got to sacrifice, well, then, maybe you can make this
argument what we have to do to Medicare. But you can`t say we -- the
situation is so terrible, we need this awful sacrifice from 54 year olds
and everybody under 54. But on the same time, we can also give trillions
of dollars in tax cuts to rich people who are frankly richer that they`ve
ever been.

It doesn`t make sense to people. It doesn`t feel fair. And Romney
and Ryan have the same vulnerability on it. There`s no gap between their
positions here.

HAYES: Also the lowest, the top marginal rate and proposed in the
Ryan plan is 25 percent, which is the lowest top marginal rates since the
Hoover administration. So, that`s going back quite a way. I mean, that`s
a radical -- 25 percent top marginal rate, if you look at the historical
top marginal rates is essentially the lowest possible bound.

HARRIS-PERRY: Which is why the Obama campaign is going to have to
make the case. I mean, as irritating it as may feel to say empirically
there isn`t actually that much room between them, that the individual
mandate and the Affordable Care Act is actually sort of a Republican circa
1990 plan. It`s not some great, big statist position. It`s certainly not
single payer. It`s none of those things, right? So, it`s actually quite a
conservative plan in the realm of what counts as conservative and
progressive.

Health care reform, so what the Obama campaign is going to have to do
is make very clearly the case that they are interested in governing for a
broader, coalition of Americans and that they are interested in making sure
that as we are coming back from this fiscal cliff, that we do so with
everybody on the boat together.

HAYES: Hold that thought. I want to bring in John Nichols, who is
my colleague at "The Nation" magazine, Washington correspondent for "The
Nation," associate editor for "Capital Times" in Madison, and also someone
who is a lifelong Wisconsinite and knows Paul Ryan quite well, knows
Janesville quite well.

And, John, one of the things I think that`s interesting to me is that
if you look at the national favorability polling on Ryan, 27 percent view
him favorably, 19 percent view him unfavorably, and 54 percent don`t know
enough to form an opinion. He`s of course extremely well known in the
circles of political journalism, but not that well known in the country.

And so, I guess, the question is how good a politician? Just
basically as a politician. He`s in a district that`s not overwhelmingly
Republican and he`s won fairly comfortable. How good a politician is Paul
Ryan?

JOHN NICHOLS, THE NATION: Well, he`s quite good. Paul Ryan is a
charming man. He`s one of those people who you can criticize to his face
and instead of getting angry with you, he will engage in a discussion --
he`d do very well on the show today. He wouldn`t be screaming or yelling.
He`d be inserting his points, and make kind of look at Ezra a little edgy
out of his eye.

KLEIN: We`ve been gone back and forth --

(CROSSTALK)

NICHOLS: But here`s the interesting thing to know about Paul Ryan,
and this is a big deal, if you follow media and how media impact politics.
Paul Ryan comes from a congressional city that has no major city in it.
And so, he has always been sort off the radar. Milwaukee isn`t in his
district. Chicago is not in his district. Madison is not in his district.

So, he`s been able to create to himself on the ground in that
district as a nice guy who sows up at the parade. Many people in the
district were shocked when they realized he was talking about cutting
Medicaid and doing things to Medicare and Social Security. Last year, when
he held town meetings after he came into the national spotlight, those
meetings with literally packed with hundreds and hundreds of people
screaming at him.

So, one of the interesting dynamics of Paul Ryan is, he`s not nearly
so well-defined even on the ground in Wisconsin until very recently.

MADDOW: That point is -- I think about that you made about how well
he is known in political journalism circles, is also, I think there`s --
we`re making a point about how ideologically divided our political
journalism media circles are.

Paul Ryan is not controversial the right. Paul Ryan is the consensus
choice almost of the right, once they realize that they weren`t going to be
able to get Chris Christie, Paul Ryan is who they wanted.

HAYES: Right.

MADDOW: Paul Ryan is a very, very controversial choice for the rest
of the country and that tells you why rick Romney and it actually is not a
good sign for the Romney campaign. You either pick somebody to help you
govern in January. If you pick somebody to help you win in November. If
you pick somebody to help you lock up you own base in August.

And this is an August pick. This is about making right Mitt Romney
more. This is not about making country like Mitt Romney more.

HARRIS-PERRY: And I actually think that 54 percent is good news.
So, I agree with --

HAYES: Who?

HARRIS-PERRY: For Ryan and potentially I think for Romney. So, I
would absolutely agree with Rachel that this is a bit of a fear pick. This
is a representative of him having not locked up the base.

But both in the case of the Obama/Clinton primaries and now again
with Romney running, when someone`s been in the public eye for a very long
time, and you don`t have a large bit of don`t know, there`s no room for a
campaign. That 54 percent is a campaign.

HAYES: We`re going to listen live as Governor McDonnell finish out
his speech as introduces Mitt Romney who`d be unveiling Paul Ryan as his
choice as his vice president ticket mate.

GOV. BOB MCDONNELL (R), VIRGINIA: -- that is which candidates got
the vision and the ideas to get the greatest country on earth, out of debt
and back to work.

You know, on the hand, we`ve got this Obama vision of more
entitlements and more guarantees and more taxes and more government as the
way to prosperity, and Mr. President, with all due respect, that`s failed
America now for the last 3 1/2 years. But then we`ve got the GOP, the
great opportunity party, in its vision and its candidate.

(APPLAUSE)

We`ve got that incredible Reagan-Romney enthusiastic vision that
recognizes the American dream, that if you work hard and you dream big and
you pursue opportunity and use your God-given talents, you can still be
anything you want to be in this great land of freedom, America.

A hundred years ago, poor farm boy from Mayo County, Ireland, left on
a ship and landed in Boston, Massachusetts. That was my grandfather. He
worked as a laborer in a glue factory and as a tanner. He never thought
that 100 years later, that his grandson would end up with the same job of
Patrick Henry and Thomas Jefferson, being governor of Virginia.

(APPLAUSE)

But that`s the United States of America, the land of dreams and
opportunity.

So being an average middle class kid from Fairfax County, I`m
incredibly thrilled to be governor of Virginia. And that`s the heart and
soul of this campaign for Mitt Romney, is doing things and putting policies
in place that support and expand and offer hope and opportunity for our
middle class families in America. Governor Romney has put forth a
visionary five-point plan to be able to get people back to work promoting
entrepreneurship and small business, because you did build it. And if you
do, you provide jobs and opportunity for other people.

(APPLAUSE)

To get our great country out of debt by balancing a budget within the
next -- within the next eight years, and he`s going to have somebody to
help him do that, to be able to get people trained in the skills and the
workforce and math and science and the other disciplines that are necessary
to create the workforce of the future. To be able to have a sustainable
energy future, this president has got no plan.

Governor Romney has got an all of the above comprehensive plan to use
all of our red, white and blue, God-given natural resources to promote
American energy independence. That`s going to help the middle class to
create jobs and opportunity for a long time.

(APPLAUSE)

So, ladies and gentlemen, you know the issues and you know the ideas
of Mitt Romney. But I want to say above all those policy issues, what
really matters is heart and character and vision and passion. The
Scriptures -- the Scriptures say "For lack of vision the people perish."
But just the opposite is true. With vision, the people prosper.

One of the loneliest places anywhere you can find is the inside of
that Oval Office. When the cabinet members leave and the advisers are
gone, the president of the United States has got to have faith and know
what they believe and make the right decisions for the people of the United
States.

That`s what -- that`s what you get with Mitt Romney. He`s a man of
faith, a man of principle, a man who has been successful as governor,
successful on the private sector, successful running the Olympics.

He`s a great family man -- five kids, 18 grandkids. He`s been
incredibly generous to people all over the country and all over the world.
He`s got an amazing passion and vision for the country. He`s got a deep
and abiding love for America, what it stands for and the great American
dream.

So ladies and gentlemen, please welcome the next president of the
United States, Governor Mitt Romney.

(APPLAUSE)

(MUSIC)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Thank you. What a welcome.
Thank you so much, Virginia. Thank you so much.

What a great governor you have. What a terrific man and a terrific
leader. Way to go.

(APPLAUSE)

Thank you so very much. It`s great to be back in Virginia and here
in Norfolk. Your city`s beauty is matched only by its proud heritage as a
defender of freedom. Thank you, Virginia. Thank you, Norfolk.

(APPLAUSE)

Today we take another step forward in helping restore the promise of
America as we move forward in this campaign and on to help lead the nation
to better days.

It`s an honor to announce my running mate and next vice president of
the United States, Paul Ryan.

(APPLAUSE)

His leadership -- his leadership begins with character and values.
Paul is a man of tremendous character, shaped in large part by his early
life. Paul`s father died when he was in high school. That forced him to
grow up earlier than any young man should, but Paul did, with the help of
his devoted mother, his brothers and sister and a supportive community.

And as he did, he internalized the virtues and hardworking ethic of
the Midwest. Paul Ryan works in Washington, but his beliefs remain firmly
rooted in Janesville, Wisconsin.

(APPLAUSE)

He`s a person of great steadiness whose integrity is unquestioned and
his word is good. Paul`s upbringing is obvious in how he`s conducted
himself throughout his life, including his leadership in Washington.

In a city that`s far too often characterized by pettiness and
personal attacks, Paul Ryan is a shining exception. He doesn`t demonize
his opponents. He understands that honorable people can have honest
differences. He appeals to the better angels of our nature.

There are a lot of people in the other party who might disagree with
Paul Ryan; I don`t know of anyone who doesn`t respect his character and
judgment.

(APPLAUSE)

Paul is in public life for all the right reasons, not to advance his
personal ambition but to advance the ideals of freedom and justice and to
increase opportunity and prosperity to people of every class and faith,
every age and ethnic background.

A faithful Catholic, Paul believes in the worth and dignity of every
human life.

(APPLAUSE)

With energy and vision, Paul Ryan has become an intellectual leader
of the Republican Party. He understands the fiscal challenges facing
America, our exploding deficits and crushing debt and the fiscal
catastrophe that awaits us if we don`t change course.

He combines a profound sense of responsibility for what we owe the
next generation with an unbounded optimism in America`s future and
understanding of all the wonderful things the American people can do. Paul
also combines firm principles with a practical concern for getting things
done.

He`s never been content to simply curse the darkness. He`d rather
light candles. And throughout his legislative career he`s shown the
ability to work with members of both parties to find common ground on some
of the hardest issues confronting the American people.

So Paul and I are beginning on a journey that will take us to every
corner of America. We`re offering a positive governing agenda that will
lead to economic growth, to widespread and shared prosperity and will
improve the lives of our fellow citizens.

(APPLAUSE)

Our plan to strengthen the middle class will get America back to work
and get our country back on track.

(APPLAUSE)

We offer solutions that are bold, specific and achievable. We offer
our commitment to help create 12 million new jobs and to bring home better
take-home pay to middle class families.

(APPLAUSE)

To strengthen the middle class, we`ll provide our workers and our
children with the skills to succeed. We`ll cut the deficit, have trade
that works for America and champion small business.

And finally, we`ll unleash our energy resources to achieve North
American energy independence.

(APPLAUSE)

We will help care for those who can`t care for themselves and we will
return work to welfare.

(APPLAUSE)

As poverty has risen to historic and tragic levels with nearly one
out of six Americans now having fallen into poverty, we will act to bring
these families into the middle class. Unlike the current president, who
has cut Medicare funding by $700 billion, we will preserve and protect
Medicare and Social Security and keep them there for future generations.

(APPLAUSE)

And under the current president, health care has only become more
expensive. We`re going to reform health care so that more Americans have
access to affordable health care and we`ll get that started by repealing
and replacing ObamaCare.

(APPLAUSE)

At a time when the president`s campaign is taking American politics
to new lows, we`re going to do something very differently. We`re going to
talk about aspirations and American ideals, about bringing people together
to serve, to solve the urgent problems facing our nation. And when that
message wins in America, it will be a victory for every American.

Today is a good day for America, and there are better days ahead.

Join me -

(APPLAUSE)

Join me in welcoming the next president of the United States, Paul
Ryan.

(APPLAUSE)

(MUSIC PLAYING)

REP. PAUL RYAN (R-WI), VICE PRESIDENTIAL CANDIDATE: Wow! Hey. And
right in front of the USS Wisconsin, huh? Man!

ROMNEY: Every now and then I`m known to make a mistake.

(LAUGHTER)

But I did not make a mistake with this guy. But I can tell you this,
he`s going to be the next vice president of the United States.

(APPLAUSE)

RYAN: Governor Romney, Ann, thank you.

(APPLAUSE)

I am deeply honored and excited to join you as your running mate.

(APPLAUSE)

I want to tell you about Mitt Romney. Mitt Romney is a leader with
the skills, the background and the character that our country needs at this
crucial time in its history.

(APPLAUSE)

Following four years of failed leadership, the hopes of our country,
which have inspired the world, are growing dim. They need someone to
revive them. Governor Romney is the man for this moment.

(APPLAUSE)

And he and I share one commitment. We will restore the greatness of
this country.

(APPLAUSE)

I want you to meet my family. This is my wife, Janna. Our daughter
Liza and our sons Charlie and Sam.

(APPLAUSE)

I`m surrounded by the people I love.

I love you, too.

And I`ve been asked by Governor Romney to serve the country that I
love.

(APPLAUSE)

Janesville, Wisconsin, is where I was born and raised, and I never
really left it. It`s our home now. For the last 14 years, I have proudly
represented Wisconsin in Congress. There, I have focused on solving the
problems that confront our country, turning ideas into action and action
into solutions.

I am committed, in heart and mind, to putting that experience to work
in a Romney administration.

(APPLAUSE)

This is a crucial moment in the life of our nation, and it is
absolutely vital that we select the right man to lead America back to
prosperity and greatness.

(APPLAUSE)

That man -- that man is standing right next to me. His name is Mitt
Romney, and he will be the next President of the United States of America.

(APPLAUSE)

My dad died when I was young. He was a good and decent man. There
are a few things he would say that have just always stuck with me. He`d
say, son, you`re either part of the problem or part of the solution.

Well, regrettably, President Obama has become part of the problem and
Mitt Romney is the solution.

(APPLAUSE)

The other thing my dad would always say is that every generation of
Americans leaves their children better off. That`s the American legacy.
Sadly, for the first time in our history, we are on a path which will undo
that legacy. That is why we need new leadership to become part of the
solution, new leadership to restore prosperity, economic growth and jobs.

(APPLAUSE)

It is our duty to save the American dream for our children and
theirs. I believe -- I believe there is no person in America who is better
prepared because of his experience, because of the principles he holds, and
because of his achievements in excellence in so many different arenas to
lead America at this point in our history.

(APPLAUSE)

Let me say a word about the man Mitt Romney is about to replace.

No one disputes that President Obama inherited a difficult situation.
And in his first two years, with his party in complete control of
Washington, he passed nearly every item on his agenda, but that didn`t make
things better. In fact, we find ourselves in a nation facing debt, doubt
and despair.

This is the worst economic recovery in 70 years. Unemployment has
been above 8 percent for more than three years, the longest run since the
Great Depression. Families are hurting. We had the largest deficits and
biggest federal government since World War II.

Nearly one out of six Americans are in poverty, the worst rate in a
generation. Moms and dads are struggling to make ends meet. Household
incomes have dropped more than $4,000 over the past four years.

(BOOS)

Whatever the explanations, whatever the excuses, this is a record of
failure.

(APPLAUSE)

President Obama and too many like him in Washington have refused to
make difficult decisions because they are more worried about their next
election than they are about the next generation.

(APPLAUSE)

We might have been able to get away with that before, but not now.
We`re in a different and dangerous moment. We`re running out of time. And
we can`t afford four more years of this.

Politicians from both parties have made empty promises, which will
soon become broken promises with painful consequences if we fail to act
now.

(APPLAUSE)

I represent a part of America that includes inner cities, rural
areas, suburbs and factory towns. Over the years, I have seen and heard
from a lot of families, from a lot of those who are running small
businesses and from people who are in need.

But what I`ve heard lately, that`s what troubles me the most.
There`s something different in their voice, in their words. What I hear
from them are diminished dreams, lowered expectations, uncertain futures.
I hear some people say that this is just the new normal.

(BOOS)


Higher unemployment, declining incomes and crushing debt is not a new
normal.

(APPLAUSE)

It is the result of misguided policies. And next January, our
economy will begin a comeback with the Romney plan for a stronger middle
class that will lead to more jobs and more take-home pay for working
Americans.

(APPLAUSE)

America is on the wrong track, but Mitt Romney and I will take the
right steps, in the right time, to get us back on the right track.

(APPLAUSE)

I believe that my record of getting things done in Congress will be a
very helpful compliment to Governor Romney`s executive and private sector
success outside of Washington.

(APPLAUSE)

I`ve worked closely with Republicans as well as Democrats to advance
an agenda of economic growth, fiscal discipline and job creation. I`m
proud to stand with a man who understands what it takes to foster job
creation in our economy, someone who knows from experience that if you have
a small business, you did build that.

(APPLAUSE)

Right.

At Bain Capital, he launched new businesses and he turned around
failing ones, companies like Staples, Bright Horizons, Sports Authority,
just to name a few. Mitt Romney created jobs and he showed he knows how a
free economy works.

At the Olympics, he took a failing enterprise and made it the pride
of our entire nation.

(APPLAUSE)

As governor of Massachusetts, he worked with Democrats and
Republicans to balance the budget without increasing taxes, lowering
unemployment, increased income and improved people`s lives.

(APPLAUSE)

In all these things, Mitt Romney has shown himself to be a man of
achievement, excellence and integrity.

(APPLAUSE)

Janna and I tell Liza, Charlie and Sam that America is a place where,
if you work hard and play by the rules, you can get ahead.

(APPLAUSE)

We look with success at one another`s success with pride, not
resentment, because we know --

(APPLAUSE)

-- we know that as more Americans work hard, take risks, succeed,
more people will prosper. Our communities will benefit. And individual
lives will be uplifted and improved.

(APPLAUSE)

America -- America is more than just a place, though. America is an
idea. It`s the only country founded on an idea. Our rights come from
nature and God, not from government.

(APPLAUSE)

That`s right. That`s who we are. That`s how we built this country.
That`s who we are.

(APPLAUSE)

That`s what made us great. That`s our founding.

We promise equal opportunity, not equal outcomes.

(APPLAUSE)

And this idea was founded on the principles of liberty, freedom, free
enterprise, self-determination and government by consent of the governed.

(APPLAUSE)

This idea -- this idea is under assault. So we have a critical
decision to make as a nation. We are on an unsustainable path that is
robbing America of our freedom and security. It doesn`t have to be this
way.

The commitment Mitt Romney and I make to you is this: we won`t duck
the tough issues, we will lead.

(APPLAUSE)

We won`t blame others, we will take responsibility.

(APPLAUSE)

And we won`t replace our founding principles, we will reapply them.
That`s what we will do.

(APPLAUSE)

We will honor you, our fellow citizens, by giving you the right and
opportunity to make the choice.

(APPLAUSE)

What kind of country do we want to have? What kind of people do we
want to be?

AUDIENCE: Free.

RYAN: We can turn this thing around.

(APPLAUSE)

We can. We can turn this thing around. Real solutions can be
delivered, but it will take leadership and the courage to tell you the
truth.

(APPLAUSE)

Mitt Romney is this kind of leader. I`m excited for what lies ahead.
I`m thrilled to be a part of America`s comeback team.

And together, we will unite America and get this done.

Thank you. Thank you very much.

(APPLAUSE)

Thanks. Thank you.

(MUSIC PLAYING)

HAYES: That is Paul Ryan, seven-term congressman from Janesville,
Wisconsin, announcing along with Mitt Romney that he will be the vice-
presidential nominee on the Republican ticket.

Mitt Romney started the speech and the introduction was something of
a flub in which he said, "Please welcome the next president of the United
States." Paul Ryan, he then came out, put his hand around Paul Ryan`s
shoulder and said sometimes I make mistakes but not with this guy and
corrected himself.

Paul Ryan giving a speech largely decrying the economic state of the
country, talking about the country drowning in debt, doubt, and despair,
decrying the fact that every generation leaves their children better off
and we now face the prospect of that no longer being the case.

Relatively short and underemphasized on the Ryan budget, which is
kind of the thing Paul Ryan is known for, particularly in political
journalism circles and in policy circles. The thing that we have talked
about, the message of that message was much more about this kind of
referendum on the economy, thumbs down.

At one point, he even says, no one disputes the president inherited a
difficult situation but whatever the explanation for it now, it`s
unacceptable. And that`s much more in the referendum vein as oppose to
choice, right? Things are bad. The current occupant should be voted down.
If things were good, they should be re-elected, but they`re not.

MADDOW: I think they`re doing the best with the challenges they`ve
got with Paul Ryan as the nominee. I mean, visually and in terms of the
overall impression, it`s a dad and lad look. I mean, Romney and Ryan go
together well, they obviously like each other. The chemistry with the
giant flub, was a nice -- it was a nice chemistry. There`s all that in
terms of the optics.

But the big issue is that they want it to be a referendum on Obama
and not a choice. Paul Ryan makes it a choice. And so, in his speech he
does not talk about what the choice of him means. He does not talk about
what`s in it. But he does play up to his brand as a guy who is serious and
will take -- will do -- take honorable sacrifices for the nation in terms
of the nation`s long-term interest.

Speaking to the brand and not the specifics -- they have to try to
stick with that. But whenever anybody else starts talking about what the
specifics are that Paul Ryan is offering, he`s going to be the kill
Medicare.

HAYES: Let me read the response that the Obama campaign sent out.
They didn`t send out anything last thing. But they timed to come out just
as the speech was happening.

"Mitt Romney has chosen a leader of the House Republican who shares
his commitment to the flawed theory that new budget-busting tax cuts for
the wealthy while placing greater burdens on the middle class and seniors
will somehow deliver a stronger economy. As a member of Congress, Ryan
rubber-stamped the reckless Bush economic policies than exploded our
deficit and crashed our economy. Now the Romney-Ryan ticket would take us
back by repeating the same catastrophic mistakes."

MADDOW: Congress, Congress, did we mention Congress? What do you
think about this Congress? Here`s a guy from that Congress.

HAYES: And I thought it was so revealing, this will be not the
headline that comes out of this speech, but given what we were just talking
about, one of the biggest crowd reaction moments was Mitt Romney, he`s up
there, introducing Paul Ryan who is an icon because he is going to finally
go after the entitlement state. That`s why we like Paul Ryan.

He has the courage to do it and he`s introducing him and introduces
him by attacking the president for $700 billion to cuts in Medicare which
got a rousing and throaty and I believe heartfelt and genuine set of boos
from the audience there. And that I think just speaks to the point that
I`ve been making about how complicated and tangled the rhetoric about
entitlement from the reality of it --

MADDOW: And also, just try to muddy the waters. These jerks, they
want to cut Medicare. When you look at me, you think Medicare cuts. I`m
going to take and deflect on to my opponents.

It`s attacking your opponent for what`s wrong with you.

ROY: They have to talk about the fact that the Affordable Care Act
cuts Medicare because that`s how they`re -- that`s how the Ryan budget is
going to be attacked, too, right? So, you have to make the numerical
comparison. You have to talk about what we talked about earlier in the
show, which is the choice between a government-driven approach to Medicare
reform and a competition.

HAYES: But that`s not the line. Let`s be honest here. The line is
landing because it`s a cut to Medicare. The line is getting boos because
it`s a cut to Medicare.

ROY: Because people like Medicare.

HAYES: Yes, I mean, I totally understand what you`re saying and
you`re right. There`s a policy choice about how Medicare is going to, you
know, function into the future. But the politics of it are, you want to
cut Medicare. That`s the applause line or the boo line.

HARRIS-PERRY: Yes, it`s something that was not the conversation that
we have previously, right? I mean, as you said, you don`t expect some line
out there accepting, being nominated for vice president to be giving a
policy speech. It`s not even close to that, right?

HAYES: Right.

HARRIS-PERRY: The very fact that he goes to ideas, America is
founded on an idea, and that somehow even though one is not meant to ever
critique the country, this notion that the country is not great at the
moment, that it must be restored to greatness, that there was once a moment
of greatness, there was once a moment of big ideas, that is now all gone,
and --

HAYES: We`ve lost our way. We are in decline.

HARRIS-PERRY: And this whole language of bringing the country --

HAYES: And I also thought that line about consent of the governed
was sort of an interesting line. There was such an incredible amount of
applause that we`re going to restore the founding principle of consent of
the governed, a huge applause, which I think plays into this implicit idea
that this is somehow, the Obama administration has been tyrannical, has
went over the consent of people,.

I want to bring in Andrea Mitchell back in. She`s NBC News chief
foreign affairs correspondent, anchor at NBC`s "Andrea Mitchell Reports."
She`s live there in Norfolk -- Andrea.

ANDREA MITCHELL, NBC NEWS CHIEF FOREIGN AFFAIRS CORRESPONDENT: First
of all, what you had with Paul Ryan was huge and bigger energy. You saw
him running (INAUDIBLE). Also talking about what the base wanted to hear,
he talked about rights come from God and it doesn`t come from government.
(INAUDIBLE).

He`s going to go out on fundraising. He`s going to go to Colorado
(INAUDIBLE). He has been told he`s not going to be taking a vacation with
his family but instead he`ll be doing some fund-raising and probably a lot
of fundraising.

I think they`ve decided that this is a base election. This is not a
pick for suburban moms. This is not a pick for women. It`s a pick for the
base.

HAYES: That`s a great point, Andrea, making a point. I`m sorry,
Andrea, our sound is a little muddy, so we`re having a hard time hearing
you.

So, Andrea Mitchell making point is this is a base election in terms
of who it appeals to and Andrea also making an important point and I`m just
getting email from a bunch of progressive women`s groups about Paul Ryan`s
record on choice, on things like birth control and on choice.

He`s ardently pro-life, ardently opposed to abortion. I just saw
that he`s taking 59 times on it, voted 59 times in the direction.

MADDOW: Can I also just say can you imagine the uproar if two
Democrats who had never served in the military and do not have family
service, history of serving in the military literally ran out of a
battleship and onto the podium to declare the vice-presidential nomination?
I mean, if two Democrats without military service records as Mitt Romney
and Paul Ryan don`t have service records, using this battleship and using
this military setting, a setting essentially as a stage set for themselves
as people who don`t have that background.

I mean, it`s one thing for Bob McDonnell to do that. Bob McDonnell
served. These guys did not. And we were talking about that in terms of
the policy that having this brand, this fiscal conservatives wanting to
increase defense spending. But it`s also the optics and the double
standard on that issue just as a social issue I think is offensive.

HAYES: I should note also -- I at first was like, wait a minute, you
can`t use it. It`s a decommissioned battleship. It`s a museum. It`s a
set piece.

MADDOW: That they`re using as a stage set to imply they have
military experience.

HARRIS-PERRY: Or just go back to the sort of - look, what they got
to try to do is take away what President Obama has, which is, in part, an
impressive record on foreign policy for hawks, right? So, if you`re a hook
voter, it`s hard to look at the Obama administration and find much wrong
with it, in the context of continuing to (INAUDIBLE) in terms of the drone
attack, in terms of the death of Osama bin Laden, right?

So part of this is going back and it`s interesting that it`s
decommissioned and a set piece. It makes it almost more perfect in this
case, right? We`re going to back to the set piece decommissioned moment of
the Republican Party as the hawk party that will build the wall that will
protect. We`re going to take that away from the empirical reality of
President Obama.

HAYES: And also, it`s neat, the last event -- I mean, it`s like
mission impossible. It`s like the last time I`ve seen a political event
with bunting kind of --

HARRIS-PERRY: I mean, you mean mission accomplished as opposed to
mission impossible? Because it just might be the mission impossible.

HAYES: That was a Freudian slip.

MADDOW: Hop out of the battle ship to do his -- to run on to the
set. It was a question as to whether it was going to be on a fight (ph).

ROY: Andrea`s point I think was right. I mean, you know, what was
Chris Matthews` line, the tingling up the leg.

HAYES: Right.

ROY: I think this was a speech that sent the tingles of the legs o f
conservatives who really are passionate about entitlement reform. This was
about energizing the base to a larger degree.

HAYES: You know, what I found -- I agree about the pick but I
actually found the speech was actually a pretty -- what I thought was
interesting about the speech is they understand that the way that Ryan is
going to be portrayed and I think quite accurately based on the substance
of the policies he`s advocating, is that someone who wants to increase the
benefits of the rich and doesn`t care about the poor.

And there was much more talk about the poor and poverty in this
speech than I`ve seen in a very long time. Paul Ryan talked about one in
six in poverty, Mitt Romney talked about one in six in poverty. Paul Ryan
talked about the decline of social mobility. Mitt Romney or Paul Ryan
talked about the decline of housing income of $4,000. That`s in real
terms.

I mean, all of these are true statistics about an economy that`s
truly in bad shape.

Ezra, you wanted to say something about that.

KLEIN: One thing I thought was striking, and it goes to the sort of
battleship as well, of trying to get the things they don`t have, is that
I`ve seen a lot of Paul Ryan`s speeches and I think he`s actually a very
good speech giver.


But it seems to me that the two candidates were kind of taking away
what the other had. So, Paul Ryan wasn`t able to be substantive in the way
he normally is. He couldn`t get into the policy specifics.

The whole thing that he has, his ability to be very specific is
potentially to be neutered by the Romney campaign and conversely, you had
Ryan complementing Romney for having business experience which Ryan himself
doesn`t have, complementing Romney for sort of being an outsider, which
Romney himself is not. He`s been in Washington for decades and decades.

You know, you also have this idea of amplifying picks that when Bill
Clinton runs he gets another young Southerner like Al Gore. And in Ryan,
actually a very conflicting pick, if you took the conventional narrative of
why Mitt Romney should be president. He`s got business experience, he`s
not part of the Washington mess, that he`s coming from the outside.

Ryan is kind of the opposite of all of this. He`s part of the
Washington mess. He doesn`t have business experience. He`s very
aggressive policy reformer whereas Romney says he`s an economic manager.

It was striking. And I kind of don`t understand how they`re going to
handle some of these not contradictions but tensions on the campaign trail,
because the more Romney talks about business, the more it highlights what
Ryan doesn`t have,. The more Ryan goes specific, the more it undermines
some of Romney`s policy ideas.

HAYES: One thing I think is interesting is the degree to which
emphasis stays on Ryan, because -- I mean, what was so remarkable, bizarre
and some sense unprecedented about the 2008 pick, was that Sarah Palin
became the center of that campaign, which is not really what you want when
you run for president more or less. Right now obviously, Paul Ryan`s the
center story because today`s the big day he`s announced and that will
continue to be the case.

I think there`s a real interesting question about I think I can see
this going in two directions. I can see Paul Ryan really becoming a more
central focus of the campaign or you can see Paul Ryan receding in the way
that a vice-presidential ticket maker would be, as essentially an
ancillary, as, you know --

MADDOW: Democrats and Republicans, conservatives and liberals, will
both want Paul Ryan.

HAYES: Exactly.

MADDOW: And the mass middle will not.

ROY: There`s a policy alignment. Both of them agree on where to
take the country. And I think -- so it`s not going to be an overshadowing,
because they`re both going to be talking about the same policies, the same
agenda, the same program.

HARRIS-PERRY: There`s going to be a little more overshadowing
because Paul Ryan is a little more interesting and enjoyable to watch to
give a speech than is Mitt Romney.

MADDOW: I don`t think so.

HARRIS-PERRY: I feel like when I listen to him, oh, yes, OK. Even
when he`s giving me bad news, I don`t feel the same sense of I`d like to
turn the television off now that I sometimes feel when I`m hearing Mitt
Romney talk.

Let me just say, just the one thing. I think the Joe Biden/Paul Ryan
debate might be wonk heaven. Like the fact, as Ezra pointed out, there`s a
lot of specifics there and lots of years in Congress. They`re going to
have a lot to say.

HAYES: Yes, that will be fun, two Catholics. Only one Protestant in
the ticket this year, that`s got to be a first in American history. We
have a Mormon, two Catholics, and a Protestant in a figure of Barack Obama.

I want to thank "Nation" magazine`s John Nichols, MSNBC policy
analyst Ezra Klein --

NICHOLS: I`ll be around.

HAYES: -- joining us from Washington, D.C.

Thanks to Melissa Harris-Perry, host of "MELISSA HARRIS-PERRY", which
you can see tomorrow here at 9:00 a.m. I believe.

HARRIS-PERRY: At 11:00. Sorry.

Avik Roy, health care policy adviser to Mitt Romney.

And Rachel Maddow, of course, host of "THE RACHEL MADDOW SHOW" of
MSNBC.

Thanks for getting up with us.

Thank you for joining us today with UP.

MSNBC`s Olympic coverage is next.

Chris Matthews will have full coverage of Mitt Romney`s choice of
Congressman Paul Ryan as his V.P. pick tonight, from 5:00 p.m. to 7:00 p.m.
Eastern Time here on MSNBC.

We`ll be back next week at our regular time, finally, Saturday and
Sunday at 8:00 Eastern. I`m very excited for that. Hope you are too.
Until you can find at Up.MSNBC.com.

Thanks for getting UP.

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