updated 11/13/2012 10:54:27 AM ET 2012-11-13T15:54:27

THE ED SHOW with ED SCHULTZ
November 12, 2012

Guests: Debbie Wasserman Schultz, Leo Gerard, Ruy Teixeira, Sam Stein

ED SCHULTZ, HOST: Good evening, Americans. And welcome to THE ED
SHOW from New York.

President Obama is winning a major class warfare battle with
Republicans and they are on the road.

This is THE ED SHOW -- let`s get to work.

(BEGIN VIDEOTAPE)

GROVER NORQUIST, AMERICANS FOR TAX REFORM: The president was
committed -- elected on the basis he was not Romney and that Romney was a
poopy head and you should vote against Romney.

SCHULTZ (voice-over): Big money interests have their backs up against
the wall in the White House knows it.

Tonight, Congresswoman Debbie Wasserman Schultz on the president`s
mandate for a new nationalism and fairness.

The election may be over, but the conspiracy theories live on.

UNIDENTIFIED MALE: I suspect these tough Chicago guys knew about this
affair for awhile, and held it in their back pocket until they needed to
play their card.

SCHULTZ: We`ll take you inside the latest right wing freak-out over
General Petraeus.

And if you have better ingredients and better pizza, why not better
health care?

Tonight, Sam Stein on Papa John`s problem with Obamacare.

(END VIDEOTAPE)

SCHULTZ: Good to have you with us, folks. Thanks for watching.

More bad news for Republicans this week. Their history of obstruction
is coming back to haunt them. President Obama made it clear Friday that he
will insist on getting rid of the Bush tax cuts for the wealthy in a new
economic plan. Congressional Republicans are playing tough in public.
Instead of tax increases on the rich, they are pushing nonspecific tax
reform.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: It`s clear that there
are a lot of special interest loopholes in the tax code, both corporate and
personal.

UNIDENTIFIED MALE: We can increase revenue without increasing the tax
rates on anybody in this country. We can lower the rates, broaden the
base.

UNIDENTIFIED MALE: Eliminate all these tax credits and tax
deductions. You can generate somewhere $1 trillion to $1.2 trillion in
additional revenue. You can actually lower tax rates by doing that.

(END VIDEO CLIP)

SCHULTZ: House Majority Leader Eric Cantor put the talking points
together in a letter to Republicans. "What would be best is a fundamental
reform of the tax code that lowers rates, broadens the base, makes
America`s businesses competitive again."

Let`s see here now. Lowering rates, broadening the base, ending
loopholes and deductions. Where have we heard this before?

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), FORMER PRESIDENTIAL CANDIDATE: If we limit or
eliminate some of the loopholes and deductions at the high end.

Putting a limit on deductions and exemptions, particularly for people
at the high end.

Bring down rates, broaden the base, simplify the code and create
incentives for growth.

(END VIDEO CLIP)

SCHULTZ: I mean, they`ve got the same talking points. Nothing`s
changed. This plan wasn`t good enough to get Mitt Romney elected
president, but Republicans are still selling it hard, aren`t they?

At least this is what they have been selling in public. Now, behind
closed doors is a little different story.

House Speaker John Boehner doesn`t have the leverage he used to have.
On a conference call with House Republicans, Boehner asked members to fall
in line. According to "The New York Times", Boehner told House Republicans
they had to avoid the nasty showdowns that mark so much of the last two
years."

Senate Republican Leader Mitch McConnell was the number one
obstructionist in the president`s first term. Now he tells "the Wall
Street Journal" that he`ll do whatever it takes to get a deal. "I`d be
willing to pay the ransom of high taxes if I thought we were going to get
the hostage out."

McConnell`s hostage is what? Entitlement spending.

"The Wall Street Journal" confirmed McConnell`s intention. He`s
willing to agree to a dollar of new taxes for every dollar in cuts. What a
difference an election makes.

(BEGIN VIDEO CLIP)

DEBATE MODERATOR: I`m going to ask a question on the stage. Say you
had a deal, a real spending cuts deal, 10 to 1, as Byron said, spending
cuts to tax increases. Speaker, you`re already shaking your head. But who
on this stage would walk away from that deal? Would you raise your hand if
you feel so strongly not raising taxes, you`d walk away on the 10 to 1
deal?

(CHEERS)

(END VIDEO CLIP)

SCHULTZ: All right. Just to remember up to speed. Remember in 2011,
Republicans would not take a 10 to 1 tax cut deal? Now, today, Mitch
McConnell is willing to do a one to one deal.

Republicans lost all of their leverage in this election. They made a
big gamble and came up empty-handed. In 2011, President Obama was cutting
deals with John Boehner on the golf course. The grand bargain to avoid a
debt ceiling crisis was very favorable for the Republicans. The president
agreed to more than $1.2 trillion in cuts, benefit reductions of Social
Security, raising the Medicare eligibility age and actually lowering tax
rates on the wealthiest Americans.

Now in the end, Republicans, what do they do? They rejected the deal.
They wanted more and the way to get it was to beat the president of the
United States in November.

The president fought back. Almost a year ago, he announced the
message of the reelection campaign, during a speech in Kansas, the same
place where Teddy Roosevelt gave birth to progressivism.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We have to ask
ourselves, do we want to make the investments we need in things like
education and research and high high-tech manufacturing, all those things
that help make us an economic superpower, or do we want to keep in place
the tax breaks for the wealthiest Americans in our country? Because we
can`t afford to do both. That is not politics. That`s just math.

(END VIDEO CLIP)

SCHULTZ: This message was no secret. The president campaigned on
raising the top tax rate throughout the past year.

(BEGIN VIDEO CLIPS)

OBAMA: But I also want to make sure we`re asking the wealthiest
households to pay a slightly higher tax on incomes over $250,000.

We`ve got to do it in a balanced way, asking the wealthy to pay a
little more, along with cuts so that we can invest in education like yours.

We have to combine spending cuts with revenue. That means asking the
wealthiest Americans to pay a little more in taxes.

(END VIDEO CLIPS)

SCHULTZ: President Obama won on this message, did he not? The
American people approved of raising taxes on those at the top. Republicans
were banking on this being a losing message, but it simply is not.

Conservatives are finally starting to cry uncle.

(BEGIN VIDEO CLIP)

BILL KRISTOL, WEEKLY STANDARD: It won`t kill the country if we raise
taxes a little bit on millionaires. It really won`t, I don`t think.

I don`t really understand why Republicans don`t take Obama`s offer to
freeze taxes for everyone below $250,000 -- make it $500,000, make it a
million. Really? The Republican Party is going to fall on its sword for a
bunch of millionaires.

(END VIDEO CLIP)

SCHULTZ: Where was that sound byte in October? When you have lost
Bill Kristol, you`ve lost the right wing.

Republicans in Washington better understand how bad their negotiating
position is.

And, of course, I think the president needs to realize how good a
position he`s in. The country is with him.

And if the Republicans don`t realize where they are, they are going to
drive their party off the cliff -- you know, that fiscal cliff everybody is
talking about.

Get your cell phones out. I want to know what you think.

Tonight`s question: Will Republicans in Congress finally work for the
American people?

Text A for yes, text B for no, to 622639. You can always go to our
blog at Ed.MSNBC.com. We`ll bring you the results later on in the show.

Joining me tonight here in New York, Congresswoman Debbie Wasserman
Schultz of Florida, chair of the Democratic National Committee.

Congratulations.

REP. DEBBIE WASSERMAN SCHULTZ (D-FL), DNC CHAIRWOMAN: Thank you.

SCHULTZ: You picked up some seats in the House. You won reelection.

WASSERMAN SCHULTZ: We did.

SCHULTZ: Good night at the office.

Now, we get down to the devil in the detail. Do you think Republicans
are willing to soften their position and actually do a deal?

WASSERMAN SCHULTZ: Well, Ed, I`d like to look at Speaker Boehner`s
remarks the other day as at least the extension of some kind of an olive
branch. But like you, I`m hearing the same things I heard on the Budget
Committee on which I sit through the Ryan budget which did exactly that,
you know, reform the taxes. They talked about lowering the overall tax
rates and closing loopholes, unspecified loopholes that they really have
never identified.

So that doesn`t sound different. But I`m optimistic that because
President Obama has proposed in his $4 trillion deficit reduction $2.50 in
cuts for every $1 in revenue. I mean, if Mitch McConnell is willing to go
dollar for dollar, and the president`s proposed $2.50 to $1, then we should
be able to work together. And I`ve heard lots of good things over the
weekend from Senate and House Republicans who have said they want to work
together.

SCHULTZ: Would Democrats accept a dollar for dollar?

WASSERMAN SCHULTZ: Well, what we need to do is sit down and agree
right away to adopt the middle class tax cuts. Give the middle class
certainty that`s over in the House. It`s past the Senate. It got, you
know, over 60 votes in the Senate.

It`s time to make that happen. Give the middle class certainty. And
then there`s a lot left that we need to work together on.

But I know that if we are both willing -- both sides are willing to
sit at the table, which the president is, and I know House and Senate
Democrats are, we`d like Republicans to join us.

SCHULTZ: But what makes you think that Republicans have gotten the
memo? I mean, this is -- OK, now --

WASSERMAN SCHULTZ: Like you said, if Bill Kristol has said that
what`s the big --

SCHULTZ: Yes.

WASSERMAN SCHULTZ: -- you know, the world won`t come to an end.

Ed, I represent, you know, a fairly wealthy congressional district,
you know, upper middle class to wealthy congressional district. You know,
from my constituents, I hear the same kind of thing. You know, my life
won`t change very much if you change my tax rate.

They know that life was really pretty good when President Clinton was
in office and the tax rate was a little bit higher. And they also
understand that we can make the kinds of investments we need to make in
education and innovation and make sure that we strike the right balance.

We`ve got to reduce spending. There`s no question about that.

You know, I can tell you I voted last summer in that debt ceiling deal
for $1.2 trillion in cuts that I`ve spent my career opposing and then you
have to go home and defend it.

SCHULTZ: So, don`t the Republicans look foolish for not taking the
deal that President Obama had for them in 2011?

WASSERMAN SCHULTZ: Well, I`m going to be a class half full. It was a
mistake for them to not take that deal. I mean it really was. And I think
-- you know, I hope that some of them realize that.

There are a lot of majority of -- the overwhelming Tea Party
Republicans in the house get reelected on Tuesday. And I hope that they
realize that cooperation should be the first thing we do. I mean, we`ve
got to work together and move forward.

Look, there were two paths and two visions laid out before voters
leading up to this election. And voters chose to continue to move forward
with President Obama. And his plan to rebuild the economy from the middle
class out, that`s not just a talking point.

SCHULTZ: Yes.

WASSERMAN SCHULTZ: That is a concept that Americans embraced.

SCHULTZ: But you don`t have a mandate unless you believe you have a
mandate. If you negotiate like you have a mandate, are you confident or
are congressional Democrats confident the president is going to draw the
hard line when he has to?

WASSERMAN SCHULTZ: Well, the president has made it very clear that he
will not sign an extension of the tax breaks from 2001 and 2003, that
include tax breaks for the wealthiest Americans. And, in fact, has gone so
far to say he`d veto them. So, that`s pretty -- it doesn`t get more clear
than that.

SCHULTZ: Well, you mentioned Bill Kristol. When a guy like Bill
Kristol steps up and says what he says, isn`t he giving Boehner some cover
to go and make the deal that there are some conservative media people out
there with some influence that will give him some backup?

WASSERMAN SCHULTZ: Yes, absolutely.

SCHULTZ: It seems like pretty solid messaging to me.

WASSERMAN SCHULTZ: And Grover Norquist certainly is them and he`s
using the same language that my, you know, little kids use.

SCHULTZ: Has he lost his influence or just as strong? And will he
play into this?

WASSERMAN SCHULTZ: I don`t think he`s lost the influence that he
should have. You know, I mean, he still strikes fear in the hearts of too
many conservative Republicans.

And, you know, look, he is in part a key to that super PAC money. So,
the super PAC money is really the big problem here that looms large over
the reelections of many of these Tea Party Republicans who fear losing in
primaries which you can see, if they strayed too far from the right, they
don`t come back.

SCHULTZ: And Congressman Allen West in Florida -- I want you to
comment on what`s going on down there.

WASSERMAN SCHULTZ: Well, it looks like I will have an opportunity to
serve with Patrick Murphy who will represent the 18th congressional in
Florida. He`s been declared the winner in all three supervisors of
elections in all three counties. He`s outside the required margin for
recount.

Unfortunately, Congressman West is not conceding and plans a legal
battle. But, ultimately, I think this will work out the way the
constituents in Florida 18 decided, which is that Patrick Murphy should be
their representative and they rejected extremism.

SCHULTZ: Congresswoman Debbie Wasserman Schultz, thanks for your time
tonight.

WASSERMAN SCHULTZ: Thank you, Ed.

SCHULTZ: Appreciate it so much.

Remember to answer tonight`s question there at the bottom of the
screen. Share your thoughts on Twitter @EdShow and on Facebook. We always
want to know what you think.

And coming up, President Obama`s plan to win the first big legislative
battle of his second term. Leo Gerard will join me.

Stay tuned. You`re watching THE ED SHOW on MSNBC. Lots more coming
up.

(COMMERCIAL BREAK)

SCHULTZ: Coming up: labor unions came out in force to help reelect
President Obama and they are teaming up again to help spread the
president`s plan to avoid the fiscal cliff. Leo Gerard of the Steel
Workers joins me next.

The right wing freaks out over the resignation of CIA Director David
Petraeus. We`ll show you their latest conspiracy theories about the timing
of the general`s resignation.

And a pizza chain says President Obama`s health care law is going to
cost his customers and his employees. Sam Stein of "The Huffington Post"
will break it down with the details tonight.

Share your thoughts with us on Facebook and Twitter using #EdShow.

We`re coming right back.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW. Thanks for watching.

President Obama holds a strong hand as he positions himself this week
on the fiscal cliff negotiations. His schedule may offer a good idea of
his priorities. Tomorrow, the president is going to meet with labor
leaders. Wednesday on the schedule, he meets with CEOs and on Friday, the
president will begin meetings with Republicans.

The president is plans to barnstorm the country to go directly to the
American people and this time around, labor is prepared to launch an all-
out effort on the air and ground to back up the president`s position.

President Obama`s greatest strength, of course, is going and talking
to the folks directly. It`s pretty obvious what he can do. He won
reelection based on his principles. He stated repeatedly the wealthiest
Americans will have to pay more and deficit reduction won`t rest solely on
the backs of middle class.

If Congress can`t get a solution during the next 45 days, Senator
Patty Murray of Washington suggested a backup plan.

(BEGIN VIDEO CLIP)

SEN. PATTY MURRAY (D), WASHINGTON: If the Republicans will not agree
with that, we will reach a point at the end of this year where all the tax
cuts expired and will start over next year. Whatever we do will be a tax
cut for whatever package we put together. So, that may be the way to get
past this.

(END VIDEO CLIP)

SCHULTZ: How are they going to get past it?

Let`s turn to Leo Gerard. He is president of the United Steelworkers
International.

Mr. Gerard, good to have you with us tonight.

LEO GERARD, UNITED STEELWORKERS: Good to be with you, Ed.

SCHULTZ: Labor literally is going to have a seat at the table
tomorrow. What are the priorities when you go face to face with the
president, when your brothers and sisters go face to face with the
president -- what`s the priority list?

GERARD: Well, the priority is jobs, jobs, jobs, and to make sure that
the president moves forward as he talked about. That we see what`s
happened to the countries that have tried austerity. So, it`s important
that the president do exactly what he said during the campaign.

He won the election by being truthful with the American public. By
talking about the tax breaks for the rich have to go the way of the dodo
bird and tax cuts for those under $250,000 have to stay in place. And if
we do that, we`re going to be able to re-stimulate this economy and we`re
going to have to focus on jobs.

I think the president has the upper hand and I`m wearing my shirt
tonight because I`m telling our members and the whole world, the
steelworkers are ready to go.

If Republicans aren`t going to move, Ed, we`re not going to make the
same mistake last time. The last time, we should have been out on the
street with the president on the stimulus bill. We should have been out on
the street with the president on the Affordable Care Act. And we let him
down, I think. We sat on our hands.

We`re not going to do that this time. We`re going to the plant gates
if we have to do.

SCHULTZ: So it`s right back to the campaign trail for labor in this
country?

GERARD: Let me tell you, we had a meeting with the AFL-CIO executive
council on Friday. It was unanimous consent amongst everybody at the table
that we`re going to stand up and defend the president`s agenda. He won
this agenda by telling the truth to the American people. We need to start
to rebuild this economy.

Look, I`m a little frustrated because I don`t think the biggest issue
facing the country is the deficit. I think the biggest issue facing the
country is jobs. If we got people back to work, if Republicans wouldn`t
have been obstructionists on the jobs bill, we`d have had more people back
at work. The deficit would have come down because we`d have more
taxpayers. We`d have been generating wealth.

So I think the president is going in the right direction. We need to
get this behind us to get on the jobs agenda.

SCHULTZ: Do you think there are any moderate Republicans left that
will work with this president or are we going to see more of the same?

GERARD: Look, there are less. And lots of the Tea Party folks got
defeated. Lots of the folks were hooking on to Simpson-Bowles got
defeated.

I think we`re starting to see maybe some sanity come into some of the
Republicans. I saw what Bill Kristol said. I heard what Mitch McConnell
said. They are at least thinking in the right direction.

But, look, these are the guys that did everything they could to
frustrate this president. And we ought not to forget that.

At the state level, Republican governors laid off 3 million public
sector workers. If they had not done that, those workers would be working
now. Taxes would have been coming into the state and into the federal
government. And this problem wouldn`t have been so great. The issue is
jobs, jobs, jobs still.

SCHULTZ: Here`s David Axelrod on Speaker Boehner`s position. Check
it out.

(BEGIN VIDEO CLIP)

DAVID AXELROD, OBAMA SENIOR ADVISER: I think that the speaker`s
comments have been encouraging. And obviously there`s money to be gained
by closing some of these -- closing some of these loopholes and applying
them to deficit reduction. So, I think there are a lot of ways to skin
this cat.

(END VIDEO CLIP)

SCHULTZ: I mean, closing loopholes that have really never been
identified by the Republicans. You know, OK, I`d like to see that list.

But labor is going to have to be the driving force on this to make
sure that the fair share is there. That it`s not on the backs of the
middle class. Are you confident that you`re going to be able to get a tax
increase out of wealthiest Americans?

GERARD: I absolutely we are. I think the president was very clear
and the American public spoke very clearly when the president said in his
campaign from day one until the votes were counted that the rich had to pay
their fair share.

One of the things I was pleased with, Ed, this week is Harry Reid made
it clear that Social Security is not on the table. Harry Reid said Social
Security is not part of the budget problem. It`s not on the table.

So, I think we can move this agenda forward. The reality is this --
in my view, the president has an army behind him. Working people stood
with him. Working people pushed him and carried him across the line.

And this time if the Republicans try to be obstructionists, I agree
with Patty Murray. It`s not a fiscal cliff. It`s a slope. People
shouldn`t have to panic.

Let it go over and then come back with a new proposal that has tax
cuts for those under $250,000.

SCHULTZ: All right. Let me see that shirt again you got on there.
What does that say? It says steel blitz?

GERARD: Steel blitz for Barack.

SCHULTZ: Oh, OK. I thought maybe you were giving up your day job and
trying out for the Steelers. I wasn`t sure about that.

GERARD: I wouldn`t make the first cut.

SCHULTZ: Leo, good to have you with us tonight. Thanks so much.

GERARD: OK.

SCHULTZ: Next the conspiracy theorists are out in full force over the
resignation of former CIA Director David Petraeus. MSNBC political analyst
Richard Wolffe will weigh in on that.

And the Republicans try to revamp their message on immigration reform.
They want to turn protesters into supporters. Find out why they could be
making a huge mistake.

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW.

The fallout continues over the resignation of former CIA director,
General David Petraeus. Petraeus stepped down last Friday, citing an
extramarital affair. An FBI investigation began over the summer when Jill
Kelley, a Petraeus family friend, contacted the agency after receiving
anonymous harassing e-mails.

NBC News investigative correspondent Michael Isikoff describes what
was in those e-mails.

(BEGIN VIDEO CLIP)

MICHAEL ISIKOFF, NBC NEWS INVESTIGATIVE CORRESPONDENT: The emails
accused Kelley of improper socializing with generals in Tampa. But they
also have references to the comings and goings of David Petraeus. Details
that weren`t public raised some concerns that somebody had access to highly
sensitive information.

The FBI followed the computer trail that led them to Paula Broadwell,
Petraeus` biographer. Both Broadwell and Petraeus admitted to the FBI that
they were having an affair. After reviewing evidence prosecutors concluded
no crimes were committed, but now some members of Congress are saying that
they or President Obama should have been notified that such an
investigation was even being conducted.

It`s curious timing for the conspiracy theorists at FOX News. They
are still beating the drum on Benghazi. Petraeus was supposed to testify
over the matter.

(BEGIN VIDEO CLIP)

PETER JOHNSON, JR., FOX NEWS: Based on the evidence we had then, this
was the Obama administration`s Watergate. This gets deeper and deeper
everyday.

(END VIDEO CLIP)

SCHULTZ: Officials say Petraeus` decision to leave the CIA was
entirely personal and had nothing to do with Benghazi or politics. But
that`s not how FOX News sees it.

(BEGIN VIDEO CLIP)

BRIAN KILMEADE, FOX NEWS: There`s not many stories that could knock
the president`s reelection right out of the headlines. Not many. We got
one.

GRETCHEN CARLSON, FOX NEWS: Are you assuming that`s why they didn`t
tell the story until after the election?

KILMEADE: The plot thickens.

DONALD TRUMP, BUSINESSMAN: The fact that his scandal wasn`t mentioned
prior to the election, that would have had an impact on the election.

UNIDENTIFIED MALE: I suspect that these tough Chicago guys knew about
this affair for awhile and held it in their pocket until they needed to
play their card.

UNIDENTIFIED MALE: The questions mount and mount and mount.

GREG GUTFELD, FOX NEWS: Was this covered up until after the election,
which would compromise safety in favor of politics? Which is disgusting,
like that hasn`t happened, has it, with Benghazi or anything else?

UNIDENTIFIED FEMALE: Yes, Benghazi, Fast and Furious.

UNIDENTIFIED FEMALE: The drone.

GUTFELD: The drone. All these things come on, Juan -- all these have
been happening after the election.

PETER DOOCY, FOX NEWS: In Washington, there a lot of people have
affairs and they don`t have to quit.

KILMEADE: President Clinton didn`t quit.

DOOCY: Yes, there you go.

(END VIDEO CLIPS)

SCHULTZ: Let`s bring in Richard Wolffe, MSNBC political analyst, and
vice president and executive editor of MSNBC.com.

What do you make of this rhetoric out there, as you just heard?

RICHARD WOLFFE, MSNBC POLITICAL ANALYST: You know, the wandering eyes
are a giveaway. You know, these people are in a state of denial and
illusion. They don`t want to admit the events of last week.

They lost the election badly. They are trying to change the subject.
I can understand why. It may be cheaper than medication, in some respect.

But this is not a rational way to deal with some -some serious issues
at the heart of what happened in Libya.

Now if you want to dress up a sex story, which is what the Petraeus
scandal sadly is, as some kind of national security crisis or some
mysterious game around the election, fine. You go and sell a sex story in
another way, pretending like it`s something else.

But this -- this is -- says more about the people who are spinning
these theories than it does about the story itself.

SCHULTZ: If this story had come out before the election, would it
have made a difference?

WOLFFE: How? On what alternative universe? I hear what they`re
saying. But it makes no sense. It makes even less sense to connect
Petraeus` sad personal life to the events in Benghazi than it does to say
that Petraeus, a man who was not exactly close to the president, would have
somehow affected the president`s reelection.

He wasn`t on the ticket. He wasn`t a surrogate. He wasn`t a
Democrat. So which point does reality mean?

SCHULTZ: The cover up. They are saying a cover up. The information
was not released. Now you have Diane Feinstein and there`s some other
Congressional members who are very concerned about how some members of
Congress were not brought into the loop. The timing is in question.

WOLFFE: And members of Congress who sit on Intelligence Committees
have every right to question how counter-espionage investigations are
managed, how the director of the CIA is treated, and especially how they
are informed. They had those concerns about any number of Bush policies
through the Bush presidency when it came to intelligence as well.

The Intelligence Committees are not fully informed about pretty much
anything anymore.

SCHULTZ: All right, as I said, Senator Feinstein, she`s making
comments saying that Petraeus will likely be called to testify. How
important is that?

WOLFFE: I think it`s important for a full discussion of what happened
in Benghazi. But the sad thing is this man is going to be dragged in front
of the cameras and the microphones to talk about his personal life. And
he`s going to be pushed to make some kind of connections. Was there any
attempt to suppress the revelations for political ends?

I just think that makes a difficult situation even more awkward for
him individually. Look, he`s a former public servant. A big job in terms
of the intelligence community. Yes, he should answer those questions.

SCHULTZ: What about Eric Cantor`s knowledge of this some two weeks
ago. Why did he hang on to it? Why didn`t he step forward?

WOLFFE: Clearly he was interested in getting the president reelected.
He was part of the conspiracy, right? It makes no sense. Yes, he was
informed, as we understand it, because there was a whistle blower inside
the FBI who felt that the inquiry wasn`t actually progressing as it should
have been.

You know, it turned out that wasn`t the case. But you have to be a
master conspiracy theorist to think Eric Cantor was trying to help the
president here.

SCHULTZ: At the end of the day, it`s an affair story.

WOLFFE: It`s a sex story. Look, again, there are serious questions
about Benghazi, diplomatic security across the Arab Spring countries. But
General Petraeus and especially Holly Petraeus, his wife, they have no
business as part of this.

SCHULTZ: Richard Wolffe, great to have you with us. Thanks so much.

There`s a lot more coming up in the next half hour of THE ED SHOW.
Stay with us.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: National Republicans and even here in the county
are ready to move on, move forward with immigration reform. Are you
willing to do that? Yes or no?

GOV. JAN BREWER (R), ARIZONA: Yes.

(END VIDEO CLIP)

SCHULTZ: The immigration evolution continues on the right, as more
righties suddenly see the light on reform. Ruy Teixeira of the Center for
American Progress saw it all coming and he joins me next.

(BEGIN VIDEO CLIP)

GROVER NORQUIST, AMERICANS FOR TAX REFORM: The president was
committed -- elected on the basis that he was not Romney and that Romney
was a poopy head and you should vote against Romney.

(END VIDEO CLIP)

SCHULTZ: America`s most powerful lobbyist is reduced to schoolyard
name calling. We`ll show you why Grover Norquist has a lot to worry about.

And the Papa Johns CEO deep dishes on how he really feels about health
care. Sam Stein is here with the story.

(COMMERCIAL BREAK)

SCHULTZ: Thanks for staying with THE ED SHOW tonight. The
Republicans are struggling to find a new way to deal with an old problem.
They`re trying to evolve when it comes to immigration.

Mitt Romney and the Republicans say that they were shocked when
President Obama won reelection Tuesday. The president won 71 percent of
the Latino vote. Romney only won 27 percent of it.

Republicans shouldn`t be surprised. Immigration issues have drawn
massive protests from California to Washington, D.C. for years. And the
Republican party has made its position very clear, enforced the borders and
flat out killed the DREAM Act.

Republicans spelled out their anti-immigration position on their
platform: tough talk on immigration appeals to the base. Listen to the way
Romney talked about immigration and immigrants during his campaign.

(BEGIN VIDEO CLIP)

MITT ROMNEY, FORMER PRESIDENTIAL CANDIDATE: Almost half the jobs
created in Texas were created for illegal aliens.

Instate tuition for illegal aliens.

People who are here illegally today.

Sanctuary cities, giving tuition breaks to the kids of illegal aliens.

Four years of college, almost 100,000 dollar discount if you`re an
illegal alien.

You can`t have any illegals working on our property. I`m running for
office, for Pete`s sake. I can`t have illegals.

(END VIDEO CLIP)

SCHULTZ: Imagine what those words sounded like to Latino voters. Now
Republicans, well, they`re kind of scrambling to change their tone right
now. All of a sudden, these guys are saying, gosh, we got to evolve on
immigration.

Senators John McCain and Lindsey Graham, they want to work on reform.
House Speaker John Boehner says he wants to find common ground. And check
this out, even Sean Hannity is trying to shift to the middle.

(BEGIN VIDEO CLIP)

SEAN HANNITY, FOX NEWS ANCHOR: We got to get rid of the immigration
issue all together. It`s simple for me to fix it. I think you control the
border first. You create a pathway for those people that are here. You
don`t say you got to go home.

And that is in a -- a position that I have evolved on. Because you
know what, it`s got to be resolved. The majority of people here, if some
people have criminal records, you can send them home. But if people are
here, law-abiding, participating, four years, their kids are born here --
you know, it`s first secure the border, pathway to citizenship, done.
Whatever little penalties you want to put in there, if you want, but then
it`s done.

(END VIDEO CLIP)

SCHULTZ: Pathway to citizenship, done. Where was all this talk
before the election? You see, this is all about getting votes. It`s not
coming from the heart. Reforming immigration policy is a huge risk for the
Republicans. They could alienate their base. There`s no guarantee that
they will win the Latino vote in the long run.

Let`s turn to Ruy Teixeira tonight. He`s a senior fellow at the
Center for American Progress. Great to have you with us.

RUY TEIXEIRA, CENTER FOR AMERICA PROGRESS: Delighted to be here.

SCHULTZ: You have seen this coming. You predicted this. Did you
think it was going to be this lopsided?

TEIXEIRA: Yes, I actually did think it was going to be this lopsided.
I looked at the data very carefully, tracked it over the course of the
election campaign. And combined with all the things you were saying about
how the Republicans seemed to be going out of their way to alienate this
constituency, we looked at the data. Saw how Latinos were trending in the
election.

I was pretty sure that Republicans were going to lose the Latino vote
by substantially more than they lost it in 2008. And that`s exactly what
happened. It was a resounding vote of no, I don`t want that from the
Latino population.

SCHULTZ: Is immigration the only issue keeping Latinos from voting
Republican?

TEIXEIRA: No, no. It`s not at all. This is a big misconception that
the Republicans have. They are thinking, oh, all we have to do is say,
we`re for immigration reform. Trust us on this. We`re really in your
corner. And the Latinos will come flocking to the Republican party.

But that`s just not true at all. Latinos -- their number one issue is
the economy and jobs. They are not single issue voters. They
fundamentally disagree with the Republican party. They disagree with
candidate Romney. They disagree with almost everyone in the Republican
party about what`s the proper role of government, what are the services
that government should provide, what are the things that government can do
to help people get ahead in the world.

They see the Republican party as being opposed to all those things.
So it`s not going to be enough at all for them just to say, oh, we`re fine
with immigration.

SCHULTZ: So how much of a risk is it within the Republican party to
make a shift on immigration such as Hannity was talking about? All of a
sudden, there`s an about face there. You have got some senators who are
saying, well, we have to work on reform. Isn`t it all about votes? It`s
not about their sincerity of equality?

TEIXEIRA: Right, it is all about votes. This is an 11th hour
conversion. There`s clearly not a great deal of substance to it. Not only
might it not be, in and of itself, saying these kind and sympathetic words
about Latinos and immigration to really bring Latinos over to their side;
they could potentially cause a fire storm in their own party by sort of
unleashing the furies about this issue.

Remember what happened the last time they tried to do anything about
immigration reform? The Republican party practically tore itself up. But
I wouldn`t be surprised if the same thing happened again.

So there`s no easy way out for the Republicans on this issue or any
others when it comes to Latinos. They have -- if they are really serious
about competing for this vote, they have to take a really thorough going
approach to reforming their party, not just on immigration, but also on
economic, social and domestic issues.

And that`s the road forward. And I think it`s going to be very, very
difficult for them.

SCHULTZ: What about a candidate? Marco Rubio, Ted Cruz? Does this
really heighten their intensity as a potential candidate down the road,
because of the problem that the Republican party has right now with
Latinos?

TEIXEIRA: Well, I think that`s sort of a knock off of this idea that
if we just talk a little bit nicer about immigration reform, everything
will be fine. The related idea would simply be let`s nominate someone who
is actually Latino and then they will love us.

But I think also that is questionable. I think, again, the Republican
party has a serious basic problem with their stance on issues and how they
actually appear on the role of government and on the provision of services
and on a wide variety of things that just aren`t reducible to having a
Latino face or having a slightly nicer position on immigration.

I think it`s a great deal more complicated than they think.

SCHULTZ: But really, if you look at the numbers and how few Latinos
voted for the Republican nominee, there`s never been a better time to get
the DREAM Act through. Would you agree? I mean, this has got to pull some
Republicans over that are going to do some votes, that are going to make a
difference in the long run.

I mean, when you look at these numbers here, President Obama 71
percent, Romney 27. You know, 67, 31, Obama and McCain. So clearly the
Latino vote continues to go to the Democrats because of this hard line
position that the Republicans have. There`s no better time to get the
DREAM Act, I would think.

TEIXEIRA: Right. No, I think it should be pushed and pushed very
vigorously. And I suspect it will be. And It think there`s at least a
chance that some Republicans will come over to the side of the Democrats on
this issue to get it passed. Though I think it will be, nevertheless,
quite difficult.

But you always have to keep in mind, it seems to me, about something
like this, while it makes some sense for the Republicans to go over to the
Democrat`s side, to maybe pass a law like this and make them seem less
toxic in the eyes of Latinos, it also gives the president a big victory.
And it`s not going to be lost on Latinos who is really responsible for
passing this act, if it does pass.

It will be primarily through Democratic initiative and with Democratic
votes. That`s not going to sit that well with some people in the
Republican party. So again, I think you just have this caught between a
rock and a hard place problem with the Republicans and Latinos. No matter
what they do, there are things that aren`t going to work out about this
very well.

So I think it`s going to be a long and painful process of reorienting
the party towards a constituency like Latinos. And there`s no easy fix.
There`s nothing they can do tomorrow or next week or next month that`s
really going to change this dramatically.

SCHULTZ: All right, Ruy Teixeira, great to have you with us tonight.
Thank you so much.

Coming up, Grover Norquist has the latest excuse for why Mitt Romney
lost the election. He`s full of it. I`ll show you why. Stay tuned.

(COMMERCIAL BREAK)

SCHULTZ: And we are back. Anti-tax advocate Grover Norquist is the
latest conservative finding a real hard time to make some sense of
President Obama`s reelection. He thought he had it all wrapped up.

You see, Norquist is the author, of course, of the anti-tax pledge
signed by nearly every Republican Congressional member. He was counting on
a Romney presidency.

President Obama has made no secret of his intention to end the Bush
era tax cuts for American households making more than 250,000 dollars a
year. So last Tuesday was a huge blow to Norquist and his anti-tax agenda.

This morning, Norquist was asked if he saw President Obama`s
reelection as a voter mandate to enact his tax plan. And it`s clear from
Norquist`s response, conservatives, they are running out of material.

(BEGIN VIDEO CLIP)

NORQUIST: We just had an election. And the House of Representatives
was elected committed to keeping taxes low. The president was committed --
elected on the basis that he was not Romney and Romney was a poopy head and
you should against Romney. And he won by two points.

(END VIDEO CLIP)

SCHULTZ: Yes, he just said President Obama won not on policy, but
because Democrats painted Mitt Romney as a poopy head.

Desperate times call for desperate measures. With the looming fiscal
cliff, even conservatives like Bill Kristol are calling for a serious
debate on taxes. And terms like poopy head, well, I just don`t think they
seem to fall in that category of serious debate. Do they?

Tonight in our survey, I asked you will Republicans in Congress
finally work for the American people? Twenty eight percent of you said yes
-- so optimistic -- 72 percent of you said no. I hate to see it, but I`m a
72 percenter tonight.

Coming up, the CEO of Papa Johns is complaining about the cost of
Obamacare. You might believe just how much money this guy makes and of
course his attitude towards health care.

Sam Stein of "the Huffington Post" is here with the latest.

(COMMERCIAL BREAK)

SCHULTZ: And in the Big Finish tonight, the founder and CEO of Papa
Johns Pizza says Obamacare is so costly, his employees will pay the price.
Papa Johns CEO John Schnatter was a big time Romney supporter and
fundraiser, I might add. He says he`s impartial to Obamacare, but his
actions suggest otherwise.

Day after the election, he told a group of college students the
Affordable Care Act could result in his employees` hours being cut. He
also said the law would cost his business five to eight million dollars a
year. Under the Affordable Care Act, companies with over 50 employees must
provide health insurance to full-time workers.

So Schnatter said some franchise owners could cut employees` hours to
avoid the extra cost. Health care is not going to break the bank for Papa
Johns. Back in August, Schnatter said the president`s health care law
would increase the cost of pizza by only 11 to 14 cents. If your product`s
good enough, that doesn`t sound too bad, does it?

But Schnatter`s recent remarks suggest the 14 cent option is off the
table. Meanwhile, Papa John`s is doing pretty good under the Obama
economy. Take a look at their commercials.

(BEGIN VIDEO CLIP)

PAYTON MANNING, NFL QUARTERBACK: What are we going to do to kick off
this season?

JOHN SCHNATTER, PAPA JOHNS CEO: One million free Papa Johns pizzas.

MANNING: Good idea, two million free pizzas, I like it.

SCHNATTER: No, no, no, one million free Papa Johns pizzas.

MANNING: Two million pizzas it is. Let`s do it.

(END VIDEO CLIP)

SCHULTZ: Papa John`s has two million free pizzas to give away, but
they can`t afford to give workers health care. Schnatter lives in a 40,000
square foot mansion with a 22-car garage. And this guy doesn`t want to
give pizza deliver workers health insurance?

On top of all of that, Papa John`s, wee, they made 44 million dollars
during the first nine months of 2012. There`s no doubt Papa John`s has the
money to provide their workers with the health insurance, but just doesn`t
like the plan.

For more, let`s turn to Sam Stein, political reporter for "the
Huffington Post." It`s get back night on pizza, Sam. I mean, this has a
way of snowballing, so to speak. This could end up being a Republican
pushback against the president and health care. What do you make of it?

SAM STEIN, "THE HUFFINGTON POST": Yes, I think you`re right. You
have seen Papa John`s take a hit in the PR department over the past couple
days. And I would imagine that if they continue down this path, there`s
going to be organized boycotts, protests that would hurt its business and
bottom line as well.

The question here is about a five to eight million dollar cost for a
company that has operating expenses of about 1.13 billion dollars a year.
So it`s minuscule in terms of the cost. What he`s trying to do is make a
political point.

But, you know, you can make political points about any numbers of
regulations. For instance, there`s minimum wage requirements. I guess
Papa Johns could just have contractors to avoid those as well.

And this is what the Obamacare is about. If you have 50 employees,
you`re required -- or more, you`re required to pay for their health care
coverage or pay a penalty. Papa John`s can pay the penalty if it wants.
It`s less than the coverage of health care.

But he`s making a political point right now. And it`s ironic, because
he doesn`t have to make this decision for another year. The law actually
takes place in 2014. So he`s trying to do it right after the election as a
way of making a point.

SCHULTZ: All right. President Obama is meeting with business leaders
on Wednesday. Do you think this is going to come up, this pushback against
Obamacare?

STEIN: Sure. Listen, we got a hint of how this is playing out when
John Boehner told ABC last week that Obamacare is now the law of the land,
and then quickly walked it back and said, you know, I`m still interested in
full repeal.

For some reason -- and you and I can divine what that is --
Republicans are still invested in actually repealing Obamacare. The
problem that they are going to confront -- as businesses as well, when they
sit down with the president, is that this thing is going forward with or
without them. In 2014, new regulations will take place, including the
banning of discrimination for preexisting conditions.

Also, exchanges in the states will take place whether or not the state
says yes or no. If they say no, the government will step in with the power
to establish a health insurance exchange. So they can either get on board
or not.

The election was sort of the last legitimate opportunity for them to
politically repeal this law. That has now passed. There are other legal
appeals out there, but they don`t really stand that great a chance. So
it`s about time that they have to work within the confines of the
legislation.

SCHULTZ: I mean, this is going to be a big issue in the midterms.
Because it`s just going to be on the verge of being fully implemented or
fully implemented in 2014. And then you`re going to have the election,
just months after that.

I mean is this a good place for the Democrats to be? I mean, those
working folks are going to get health insurance because of this law.

STEIN: Yeah. Listen, there`s always this mind set about the law that
the longer it existed, the more the legislation went into effect, the more
popular it would be. Now that hasn`t actually proved correct in the first
couple years, in large part because some of the goodies were back loaded
and some of the tough stuff was front loaded.

Now we`re going to see if the bill can actually sell. And if you
looked at any of the polls during the election, people still wanted to
repeal the legislation. But a lot more people want to either keep it in
place or expand upon it, reform it .

So my guess is that you`re going to a have a few efforts to actually
reform the legislation without doing away with it entirely, maybe some more
opt out ability, if that`s a word, for states. And I think it will
generally gain in popularity as we go along.

SCHULTZ: I think it will. And it will set up state exchanges, no
doubt. Sam Stein, "Huffington Post," good to have you with us tonight.

That`s THE ED SHOW. I`m Ed Schultz. "THE RACHEL MADDOW SHOW" starts
right now. Good evening, Rachel.

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

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