updated 11/21/2012 9:37:51 AM ET 2012-11-21T14:37:51

HARDBALL
November 20, 2012

Guests: Matt Kibbe, Robin Wright, Steve Clemons, Keegan-Michael Key, Jordan Peele

CHRIS MATTHEWS, HOST: Judgment to Rush.

Let`s play HARDBALL.

Good evening. I`m Chris Matthews in Washington.

"Let Me Start" tonight with this. Victory has a hundred fathers, John
F. Kennedy said, defeat is an orphan. Well, let me tell you, the people in
the Republican conservative parts of this country are rip (ph). They had
it in November -- or rather, they had it in October, they lost it in
November.

Somehow, like an NFL receiver, they saw that football landing in their
hands, saw it floating right in there, and then it managed to slip right
through, gone, the whole ball game, the game they had won now lost. And
that`s why they`re looking for someone to blame.

They can`t blame that liberal Obama, so they`re blaming that liberal
Romney, that Northeastern liberal crowd, Hemmer (ph) complains. Texas
senator-elect Ted Cruz is crueler still. He accuses Romney of going out
there and "French kissing" Obama.

Yes, they`re blaming Romney now. They were blaming Chris Christie for
working with Obama during Hurricane Sandy. Now they`re blaming Romney for
dancing with him through the election. Get it? The strict orthodox side
of the Republican Party, the conservatives, are blaming the candidate
himself for giving away their virtue.

Ed Rendell is the former governor of Pennsylvania and MSNBC political
analyst and Matt Kibbe is president of FreedomWorks. Governor and Matt,
this is the most unusual pairing I think I`ve ever been part of here, you
and Matt Kibbe, Governor...

(LAUGHTER)

MATTHEWS: ... you, a man of the Northeast establishment, a moderate
Democratic, governor of Pennsylvania, and here`s Matt Kibbe railing at the
ramparts against all that you represent. So this should be interesting.

Anyway, the right fights back. Since the election, a lot of
Republican soul searching has focused on the need to broaden the base, the
political base of the Republican Party. Well, fiscal and social
conservatives are saying, on the other hand, that`s the wrong message. The
correct takeaway, they say, from the election is that the party was too
moderate.

Here`s Tea Party favorite Ted Cruz, the senator-elect from Texas.
Let`s watch him.

(BEGIN VIDEO CLIP)

SEN.-ELECT TED CRUZ (R), TEXAS: Inevitably, there are these mandarins
in politics who give the voice (ph), don`t show any contrast, don`t rock
the boat. So by the third debate, I`m pretty certain Mitt Romney actually
French kissed Barack Obama!

(LAUGHTER)

(END VIDEO CLIP)

MATTHEWS: Well, social conservative Bob Vander Plaats of the Family
Leader told "The Washington Post," quote, "The moderates have had their
candidate in 2008 and they had their candidate in 2012, and they got
crushed in both elections. New they tell us we have to keep moderating.
If we do that, will we win?"

And Tea Party senator Jim DeMint of South Carolina had this to say
about moderate senatorial candidates. Quote, "What I learned is the people
who are still out there running on bold ideas, those conservatives won. In
the cases -- won -- in the case of Rehberg, Berg and Tommy Thompson, having
a moderate candidate does not win races for Republicans."

I want to start with you, Matt Kibbe, because you`re on the right, and
your sense of this election. Was Romney too moderate and too big tent and
not fervent enough and not much of a conviction politician, or was he
unable to reach all kinds of people that just didn`t go for the
conservative message?

MATT KIBBE, FREEDOMWORKS: You know, if you look at this race, it
wasn`t so much conservative versus moderate, it was lacking a set of
issues. You really struggled to see what Mitt Romney was for. And there
is a sense amongst the establishment Republican political class to not run
on issues, to almost run a beauty contest, and Mitt Romney lost that fight
against Barack Obama.

I think it`s pretty clear that when Republicans run on core fiscal
conservative issues and offer a positive, compelling case for those issues,
they do win.

MATTHEWS: Do you buy that, Governor?

ED RENDELL (D-PA), FMR. GOVERNOR, MSNBC POLITICAL ANALYST: No, not at
all. I mean, Mike Castle would have crushed our Democratic candidate for
Senate. He lost to a Tea Party candidate. Richard Lugar would have beaten
our candidate in Indiana. He lost to a Tea Party candidate.

Look, it`s not moderate versus conservative, it`s sensible and
rational. The Tea Party -- and no offense to Mr. Kibbe, who I`ve seen on
TV and is a pretty decent guy -- but they`re running often a bunch of
wackos whose views on key issues, not just economic issues, are so far
afield from ordinary Americans that they`re destined to lose.

MATTHEWS: Well, what about...

RENDELL: No offense.

MATTHEWS: No offense, of course. That`s how you speak with no
offense in Philly.

(LAUGHTER)

MATTHEWS: Let me -- let me ask you, Matt, with no offense here, what
about this guy Mourdock, who talked about rape in the strangest ways, or
the other guy, Akin, who talked about "legitimate rape," like he mistrusts
women`s testimony in court, it seems? And what about that woman out in --
I forget her name now, unfortunately -- out in Nevada, who was really tough
on -- Sharron Angle, who was so tough on issues that she was talking about?

Do you think they`re saying it the wrong way when they`re speaking
conservative language or they`re saying it -- they`re saying something
wrong?

KIBBE: Well, you know, Todd Akin...

MATTHEWS: Which is it?

KIBBE: Todd Akin was never a Tea Party candidate.

MATTHEWS: OK.

KIBBE: That`s important. There were two other primary challengers
who were the favorite of the Tea Party who focused on fiscal conservatism.

MATTHEWS: Were they to his right?

KIBBE: No -- well, they were focused on economic issues.

MATTHEWS: Right.

KIBBE: He was always from the social conservative wing of the party,
but a big fan of earmarks. Even Claire McCaskill discovered that she was
against earmarks.

Democrats ran on what I would call Tea Party issues, but there is no
Tea Party. There is a set of issues that define the Tea Party movement,
and you had both Republicans and Democrats successfully running against
earmarks, distancing themselves from "Obama care"...

MATTHEWS: Well, let`s be honest...

KIBBE: ... running for balanced budget.

MATTHEWS: Yes, you say it`s fiscal issues, but you know, below the
surface, you hear a lot of concern about illegal immigration, anger about
it from Tea Party people. It`s not all numbers.

KIBBE: It`s not -- that`s...

MATTHEWS: Well, tell me how you deal with the immigration issue when
you`re talking to people who are here without papers or their families came
here without papers and they`ve come in in that situation? They hear you
say "self-deport." They hear, Get out of here, which is literally what
Romney was saying, Get out of here.

Is that -- did he say it wrong or did he say something wrong? Did he
say it the wrong way?

KIBBE: Now, are you calling Mitt Romney a Tea Party candidate?

MATTHEWS: No, I`m asking...

KIBBE: This is how it gets so confusing.

MATTHEWS: I`m just asking the question. You take a strict line on
immigration. Are you appealing to immigrants or not?

KIBBE: Here`s what I think the Tea Party philosophy is on a lot of
things. Everybody should follow the same rules as everybody else, and we
don`t like changing the rules after the fact, and we`d like to get at the
government failure on immigration. Why is it that people who want to come
here and work can`t go through a rational process? Isn`t that part of the
illegal problem? Why don`t we fix the government failure first?

MATTHEWS: Yes, I`m with you. I`d like to see work permits, like in
every other country in the universe, but the libertarians on the right...

RENDELL: And I think...

MATTHEWS: The libertarians on the right don`t believe in work
permits, do they.

RENDELL: I think work permits...

MATTHEWS: The Dick Armeys of this world hate work permits. Your
witness, Governor.

RENDELL: The work permits are one of the answers to a really long-
term immigration (INAUDIBLE). Look, the problem is, on fiscal policy --
first of all, Matt, I would honestly say that this election rejected a lot
of the fiscal policy that the right has been pushing, and I don`t know
specifically Tea Party, but I think Americans do want government to be
involved. I think Sandy brought that issue home with a crashing reality.

They don`t want big government, but they want effective government.
They want government to play a role in their life. They don`t want a
government that doesn`t spend money on the things that are important to
them.

MATTHEWS: I want you -- I want you to take this challenge from Rush
Limbaugh, Matt. And you are a good guy, so take on Rushbo because he`s
(INAUDIBLE) your solution (ph) or your cheerleader or your problem.

The day after the election, Rush Limbaugh was saying, Don`t go crazy,
Republicans, you already have your outreach efforts in place. Listen to
this guy. I think he gets to the point of it, ironically.

(BEGIN VIDEO CLIP)

RUSH LIMBAUGH, RADIO TALK SHOW HOST: Clarence Thomas, Herman Cain --
none of it counts! Don`t tell me the Republican Party doesn`t have
outreach! We do. But what are we supposed to do now? Are we supposed to
-- in order to get the Hispanic or Latino vote, does that mean open the
borders and embrace the illegals? Is that -- I want you to think about
this. If we`re not getting the female vote, do we become pro-choice? Do
we start passing out birth control pills? Is that what we have to do?

(END VIDEO CLIP)

MATTHEWS: Is that what you have to do, Matt?

KIBBE: No. I think our movement`s colorblind. And the irony of what
we`ve done is we`ve repopulated the Republican Party with men and women,
black, brown, white, it doesn`t really matter because we judge people on
issues.

But where do you think Ted Cruz came from? Where do you do you think
Marco Rubio came from? It wasn`t from the establishment wing of the
party...

MATTHEWS: Right.

KIBBE: ... it was us. And we don`t judge people based on the color
of their skin.

MATTHEWS: Well...

KIBBE: I thought that`s what we all believed.

MATTHEWS: ... they judge you that way.

(LAUGHTER)

KIBBE: I thought that`s what we all believe in.

MATTHEWS: I think they judge you that way because they have a sense,
looking at Ronald Reagan on forward, that you`re not a party of welcoming -
- a welcome mat for minorities.

KIBBE: Well, we got to work on that. Absolutely. And I think that`s
what this -- we`re repopulating the whole Republican Party. It`s no longer
octogenarian white guys. We`re bringing in everybody.

MATTHEWS: OK, Governor, he`s -- he`s portraying a party that doesn`t
exist yet. I don`t know where that Republican Party works. I mean, where
is that party?

RENDELL: And they really don`t seem to have learned the lessons.
Literally, Matt, less than a week after the election results, where single
women voted against the Republican Party 68 to 30, Ohio Republicans went
ahead and put essentially a personhood bill on the floor of the Ohio
legislature, a personhood bill that was turned down in Mississippi. Are
you guys nuts?

KIBBE: No, I`m not nuts, actually.

MATTHEWS: Well, what do you answer?

KIBBE: I don`t even know what a personhood...

RENDELL: Well, would you have...

KIBBE: ... bill is, to be honest with you.

MATTHEWS: A personhood bill says at the time of your conception, a
fetus`s conception, the second after sex, basically, all of a sudden, 14th
Amendment rights are appropriate -- life, liberty and property, whatever
that means.

KIBBE: I think any conversation that`s not about fiscal crisis and
the government spending too much money it doesn`t have is off base right
now. And I think that`s what the Tea Party brought back to the
conversation. We`re actually concerned...

MATTHEWS: OK, you say that -- now, look, you keep saying it`s only
about money and dollars and cents. And if it was only about that, your
party, the conservative party in this country, would be doing very well.

But you always go off into this other -- here`s Senator Marco Rubio.
I thought he was just a fiscal conservative. He`s already...

(CROSSTALK)

RENDELL: Unbelievable!

MATTHEWS: Listen to what he`s saying. He looks pretty eager to curry
favor with the hard -- , look, take a look at what he said in an interview
with "GQ" magazine, when he was asked how old he thinks the earth is.

Quote, "I`m not a scientist, man." Man. "I can tell what you
recorded history says. I can tell you what the Bible says. But I think
that`s a dispute among theologians, and I think it has nothing to do with
the gross national -- gross domestic product or economic growth in the
United States whether the earth was created in seven days or seven actual
eras. I`m not sure we`ll ever be able to answer that. It`s one of the
great mysteries."

No, no. The question to him was, Do you believe in science? And
that`s a reasonable question. If Lucy is over 2 million years old and we
have scientific evidence of human life of some form going way back 2
million years, do you just ignore that because it says something in the
Bible? What do you do? And a person who behaves that like that, who
doesn`t separate his religion from his scientific faith, don`t you have a
problem with that person talking to them?

KIBBE: Well, I wonder why -- why do we care what...

MATTHEWS: Well, why does this guy say that? Why doesn`t he say, I
believe -- I believe in science, just say it?

KIBBE: Why do we care about what any politician...

MATTHEWS: Well, because we talk about global warming and things like
that. You`d like to believe you can start from a common basis believing in
scientific method, or else not. If you don`t, then how do you have a
conversation?

KIBBE: I don`t even see the link between the two. I happen to not
know how old the earth is and I don`t think it matters...

MATTHEWS: Well, wouldn`t you like to...

(CROSSTALK)

MATTHEWS: Governor, you`re again -- because I don`t know -- I`d like
to -- if I saw a doctor and on his wallet said, you know, imaginative
design or some theory, I`d say, Oh, I wish you`d taken biology in school
just to start, or organic chem. Start with the basics.

KIBBE: I`m all for science.

(CROSSTALK)

RENDELL: But Matt, it does matter, Matt, because on the issue of
global warming, most of the people in the Republican Party and a number of
Tea Party-ites deny the science, which is absolutely clear -- and of
course, Sandy brought it home to us again -- that what we are doing, what
men are doing to the environment is causing global warming. And if you
deny that, it means you`re not going to take steps to prevent it.

So it is important. It is important whether people deny science or
not.

KIBBE: So there`s only -- I mean, we`re accepting that there`s one
science and -- and -- and -- this is -- this is pretty interesting.

RENDELL: Ninety-eight percent of scientists tell you...

KIBBE: Right.

RENDELL: ... that what we are doing to the environment has an effect.
And if you haven`t seen the changes in weather -- how old are you, Matt?

KIBBE: I`m 49.

RENDELL: How old are you?

(CROSSTALK)

KIBBE: If you haven`t seen the changes of weather in the last 20
years in your lifetime, then you are oblivious. The weather is changing.
We are screwing things up...

(CROSSTALK)

KIBBE: This has nothing to do with what Marco Rubio said at all.

MATTHEWS: Why didn`t he just answer the question?

(CROSSTALK)

RENDELL: Sure, it does, Chris, because if he denies science -- he
should say, I believe in science.

KIBBE: He doesn`t -- he doesn`t deny science. I mean, that`s
ridiculous.

RENDELL: Well, he did on that.

MATTHEWS: Let me ask you -- let me tell you, when I got up in
Philadelphia putting chains on my tires about every day when I went to high
school -- getting the chains on the tire with the ice and the snow is the
way we lived. What happened? Just what happened?

KIBBE: Weather changes. I mean...

MATTHEWS: Oh, it changes. I get you.

KIBBE: Have you noticed this? It does change.

MATTHEWS: I would say that it has been changing. I`d say New York is
refitting itself...

RENDELL: He believes...

MATTHEWS: ... now from being under water, practically.

KIBBE: Well, let`s talk about...

RENDELL: He believes in global warming...

(CROSSTALK)

KIBBE: Let`s talk about a practical thing. If -- if -- if...

RENDELL: Well, global warming is very important.

KIBBE: OK, global warming is very important. What is it that we
think that a bunch of politicians in Washington, D.C., who can`t even
balance the budget -- what are they going to do about global warming,
seriously?

RENDELL: Well, I`ll give you a perfect example.

KIBBE: There`s such a thing as political failure. There`s such a
thing as the limits to what government can do. If you really think that
the climate is changing, do you really think that government can redesign
the entire global economy, not just in the United States, but in the entire
world in a more rational way? I think you`re expecting too much from
politics.

RENDELL: Not at all, Matt. I`ll give you just one example, and there
are a legion of examples. By building up CAFE standards, meaning the miles
per hour that cars have to get, we are burning significantly less petroleum
because of what the Obama administration has done to raise CAFE standards.

For every time we double the mileage requirement for cars, we`re
eliminating a significant amount of CO2 that goes into the atmosphere.
That`s something government did, did it, you know, in a forthright fashion,
and it is making a difference.

MATTHEWS: OK. Government put a man on the moon. Government is not
essentially incompetent. That`s a ridiculous argument. By the way, when
we start taking steamship rides across the polar cap, I think you guys
should admit that something`s going on a little different than, as you put
it, weather changes. There ain`t going to be a North Pole anymore.
Where`s Santa Claus going to live?

Anyway, Ed Rendell, thank you, Governor, and thank you, Matt Kibbe,
for putting up with the truth for at least 10 minutes.

(LAUGHTER)

MATTHEWS: Coming up, more on the Republican civil war -- crush Rush.
The sensible voices in the Republican Party are letting Rushbo in on a
secret. It`s not your grandfather`s rural white conservative America
anymore.

Plus, cementing her legacy. Hillary Clinton lands in Israel. She`s
there to broker a truce between Israel and Hamas in what could be her last
big act before she leaves the stage -- for now.

And that was -- and was this the best ad of the 2012 campaign?

(BEGIN VIDEO CLIP)

MITT ROMNEY (R-MA), FMR. GOV., PRES. CANDIDATE: O, beautiful for
spacious skies, for amber waves of grain...

(END VIDEO CLIP)

MATTHEWS: Wow. The best and worst political ads and candidates
coming up in the "Sideshow."

And "Let Me Finish" tonight with my advice for the president`s second
term. I think it`s important for him and us.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Republican congressmen Allen West of Florida has finally
conceded defeat. In a statement, West, the Tea Party darling, said -- he
congratulated his opponent, Democrat Patrick Murphy, and said, "Our legal
team does not believe there are enough overcounted, undercounted or
fraudulent votes to change the outcome of this election."

By the way, West will go down in history as one of the most outspoken
members of the class of 2010. He once said that there are 80 communists in
the Democratic caucus in the House, right there in that chamber with him,
80 commies.

We`ll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

LIMBAUGH: OK, so you people are all white, 65 and over, and you live
in the sticks, and you are screwing up the Republican Party because you are
believing what I say. This is their explanation for having lost.

(END VIDEO CLIP)

MATTHEWS: Welcome back to HARDBALL. That was Rush Limbaugh -- he is
a performer -- yesterday telling his audience that so-called reasonable
Republicans, like campaign veterans Mike Murphy and Steve Schmidt have it
wrong. Rushbo`s upset because they`re calling him one of the problems on
the right. But the problem for Republicans is that they`ll never expand
their base if Rushbo is their target audience, let`s be honest.

With me are two radio talk show hosts -- got them together -- MSNBC
analysts, as well -- Michael Smerconish of Philadelphia and Ron Reagan in
Seattle.

Gentleman, let`s take a look at what`s gotten Rush so riled up.
Here`s Mike Murphy -- I always thought this guy was one of the smarter
consultants -- on "MEET THE PRESS" last Sunday.

(BEGIN VIDEO CLIP, "MEET THE PRESS WITH DAVID GREGORY")

MIKE MURPHY, REPUBLICAN STRATEGIST: -- because it`s very fashionable
now to beat up Romney. And he made an unfortunate comment after the
election.

But the biggest problem Mitt Romney was the Republican primary. And
that`s what is driving the Republican brand right now to a disaster. And
we have got to get kind of a party view of America that`s not right out of
Rush Limbaugh`s dream journal.

(END VIDEO CLIP)

MATTHEWS: Wow.

Well, and here is Steve Schmidt breaking down the election problems
last week in a bite that sent Rush Limbaugh into a tear.

(BEGIN VIDEO CLIP)

STEVE SCHMIDT, FORMER MCCAIN CAMPAIGN SENIOR ADVISER: We would have
been much better off running against the real President Obama, as opposed
to the sinister pretend President Obama.

(LAUGHTER)

SCHMIDT: And the total lack of credibility with some of this stuff I
think is just absolutely repellent to the middle of the electorate.

And then when you look at the demographics, who is Rush Limbaugh
talking to? He is talking to a demographic that`s white, 65-plus, and
rural. That`s not what the country looks like anymore.

So, you have these talk radio hosts making millions and millions and
millions of dollars a year driving a message of complete and total
ludicrous nonsense into the electorate, a lot of it poisonous.

(END VIDEO CLIP)

MATTHEWS: Well, here is Rush responding to that little jeremiad right
then from Steve Schmidt.

(BEGIN VIDEO CLIP, "THE RUSH LIMBAUGH SHOW")

RUSH LIMBAUGH, RADIO TALK SHOW HOST: You have got to get a view of
the Republican Party that is not right out of my dream journal.

What, folks, did I or any of you have to do with the Republican
primary? Did not Murphy get the candidate he wanted? All these
consultants, do you realize they get rich no matter who wins or loses?

Little known secret, they get rich no matter who wins or loses. But
the Republican primary, what was wrong with the Republican primary? As far
as he`s concerned, there were too many conservatives in it saying too many
stupid things.

We need to get rid of conservatism is what he`s saying. We know
Schmidt knows how to lose, and we know that Murphy knows how to lose, and
so it`s quite natural to blame somebody else. Obama got away with it.
Obama blamed Bush, and he got away with it. People bought it. So now
these guys want to blame me.

(END VIDEO CLIP)

MATTHEWS: Michael Smerconish, thanks for coming.

I don`t even know who you voted for, so you`re fascinating to me, as
always.

But let me -- here is the guy. Did you hear what he said, Limbaugh?
I have always had a theory in politics, if you listen to people when they
make their harshest criticism of the other side, it`s usually about
themselves. He said, these guys get rich no matter who wins or loses.

Talk about Rush. He`s never taken a loss. He wins no matter what
because there`s always somebody in the car willing to listen to him because
they`re lonely, basically. Your thoughts?

MICHAEL SMERCONISH, MSNBC POLITICAL ANALYST: Well, here`s the irony.

The irony is that the same demographic problem faced by the GOP is
faced by talk radio. And Steve Schmidt was making reference to that. Both
are overly dependent on older white guys.

MATTHEWS: Yes.

SMERCONISH: But they have different objectives, because the
Republican Party exists for one purpose, and that is to win elections, to
get to 51 percent.

That doesn`t need to be the objective of the Republican -- of the talk
radio industry.

MATTHEWS: Right.

SMERCONISH: The talk radio industry is predicated on a very small,
but very loyal audience. And like those constructions to whom Rush refers,
he stays in a position of power regardless of who wins the election.

As a matter of fact, there`s a good school of thought out there that
it bodes well for him because President Obama has been reelected.

MATTHEWS: And then he becomes the government in exile, right.

SMERCONISH: Correct, antagonizing the incumbent.

MATTHEWS: Yes. That`s a good thought.

Do you agree with that, Ron, that Rush benefits from being a perceived
or self-perceived minority, under -- an aggrieved minority, a small group
of guys who aren`t appreciated and everybody else is a femi-Nazi or
whatever else term he throws out there?

RON REAGAN, MSNBC CONTRIBUTOR: Right. Right.

And Rush, as you pointed out, the irony, he prospers no matter what
and he`s probably thrilled that Barack Obama has been reelected so he can
hammer him for the next four years. But, listen, the Republican Party`s
problem is much bigger than Rush Limbaugh, it`s much bigger than FOX News,
it`s much bigger than demographics, ethnicity, age, and all that.

It`s ignorance. And it was typified by Marco Rubio the other day.
You mentioned that in the last segment. Marco Rubio, who is a fairly
bright young guy, who probably does know how old the planet Earth is, felt
compelled to pretend differently. So he`s either stupid or he`s pandering
to ignorance.

And that`s what the Republican Party has gotten stuck with, pandering
to ignorance all the time.

A sizable chunk of their party simply doesn`t know what kind of planet
they live on. They have all sorts of fantasy ideas about the world.

MATTHEWS: Well, what do you think, Ron? Ron, that`s very tough.

Do you think they believe that somebody, some liberal from New York
snuck around the planet and buried all those old bones at one point in
history at some time to create this case that there was a two-million-year-
old human history?

REAGAN: Just before...

MATTHEWS: What do they think? How do they think Lucy get there? How
do they find -- what is their explanation for all -- the fact that there
were dinosaurs on this planet? What do they -- how do they deny it?

REAGAN: Listen to Congressman Paul Broun of Georgia, who is on the
House of Representatives Science Committee, talking to his constituents
about how it`s all the devil`s work trying to fool people and that he`s
worked out that the planet is actually only 9,000 years old.

I mean, this is what these people believe. And, yes, somebody is out
there burying ancient fossils on their way to creating a hoax called global
warming. It`s all of a piece.

MATTHEWS: Well, I think the Bible is for moral truth. I think that`s
a safe subject, a safe assessment. I don`t think it`s for scientific
information. And I don`t think anybody really thinks it does.

But, Michael, let me get back to this question. The Republican Party
is right now in a period -- and we`re watching it and we`re enjoying it to
some extent -- looking for what went wrong.

SMERCONISH: Right.

MATTHEWS: Some believe it`s the loudness from the right. Some
believe they didn`t run a real right-wing candidate. My argument would be
if they ran the real thing, like they always say, will run the real thing,
they will find themselves in even a narrower or smaller circle to defend.

SMERCONISH: Well, those two thoughts are actually related, and here
is how.

The group that you`re talking about, this cabal between talk radio and
FOX News and conservative outposts, has a stranglehold on primary voters.

MATTHEWS: Right.

SMERCONISH: There`s been an exodus of independents from the GOP.
They do take their marching orders from the individuals that you`re talking
about.

And so, too, do Republican elected officials, because they have got to
play to that primary base. Where this campaign went off the rails, I say,
is that Governor Romney had to sell crazy in primary season. He was one of
those hands that went in the air and said, I would reject a 10-for-one
deal. In a nutshell, that where they went off track. They would reject
$10 of spending cuts for every $1 of tax increases.

Why? Because they didn`t want to face condemnation from the media
hosts that you`re now addressing the following day.

MATTHEWS: And it`s just like I will sell this -- I will say this
again. They used to say -- I won`t use the bad word, of course, but the
old days in the South, among the Dixiecrats, you couldn`t win unless you
were the furthest out on the most segregationist line, because if anybody
went soft on the race issue even slightly on civil rights, you were
finished.

So, the only way you won was go hard right and become the ultimate
segregationist, and that held the South back for decades.

Anyway, thank you, Michael Smerconish.

Thank you, Ron Reagan.

Have a nice holiday for all of you.

Up next: the best and worst campaign commercials of the 2012 campaign
coming up. These are kind of interesting ones. We forgot a lot of these.

This is HARDBALL, the place for politic.

(COMMERCIAL BREAK)

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

First up, the political version of the Oscars, kind of. "The
Washington Post" is out with its list of the 2012 election Fixies, they
call them, or the best and worst candidates and ads of this election cycle.

First the ads. The best goes to the Obama campaign with this "America
the Beautiful" themed anti-Romney ad.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), FORMER PRESIDENTIAL CANDIDATE (singing): Oh,
beautiful for spacious skies, for amber waves of grain, for purple
mountains majesty above the fruited plain America. America, God shed his
grace on thee.

(END VIDEO CLIP)

MATTHEWS: Wow.

Worst goes to Todd Akin for his straight-to-camera apology ad
following his remarks about so-called legitimate rape. He lost the
election over that one statement, but no ad was going to win back the
votes.

Now to the candidates. Best goes to the Democratic senator-elect
Heidi Heitkamp of North Dakota. She had a surprising victory in a red
state won easily by Mitt Romney. "The Washington Post" notes that
Heitkamp`s positive ad campaign as one reason she came out on top.

Finally, the not-so-desirable Fixie for worst candidate of the 2012
election cycle. Spoiler alert here: "Oops."

(BEGIN VIDEO CLIP)

GOV. RICK PERRY (R), TEXAS: I would do away with the Education,
the...

(LAUGHTER)

UNIDENTIFIED MALE: Commerce.

PERRY: Commerce. And let`s see. I can`t. The third one, I can`t.
Sorry.

(LAUGHTER)

PERRY: Oops.

I come from a state, you know, where they had this little place called
the Alamo and they declared victory or death. You know, we`re kind of into
those slogans, man. It`s like live free or die, victory or death, bring
it.

(LAUGHTER)

(END VIDEO CLIP)

MATTHEWS: Well, there you have it. Rick Perry, a lot of people
thought he had a good shot at the nomination when he first entered the
race. I did, until I got to know him.

Finally, what`s Mitt Romney been up to post-election? Well, this
photo of the former candidate putting gas in his car has gone viral
overnight. There he is, regular guy Mitt. Snaps like this one would have
actually have helped him out a little during the campaign, a little human
behavior that a lot of people weren`t sure he actually took part in.

Instead, we have this quote from political analyst Larry Sabato. "I
just don`t think Romney ever established an emotional connection with much
of anybody in the party. He was essentially a cyborg designed to win the
presidency. And when he failed, he was placed in a disposal bin." Boy,
that`s cold.

Up next, Hillary Clinton is in the Middle East right now. She got
there in one flight from Burma, old Burma, looking to broker a peace truce
to end the violence between Israel and Hamas. It could be her final act of
secretary of state and it could cement her legacy. Let`s see how she`s
doing coming up next.

That is HARDBALL. You`re watching it, the place for politics.

(COMMERCIAL BREAK)

AMANDA DRURY, CNBC CORRESPONDENT: I`m Amanda Drury with your CNBC
"Market Wrap."

Well, stocks sold off on comments from Ben Bernanke today, but the Dow
did manage to stage a comeback, closing down just seven points. The S&P
and the Nasdaq finishing flat.

Fed Chairman Bernanke said that the Central Bank does not have the
cools to cushion the blow from failing to fix the fiscal cliff. Meanwhile,
Hewlett-Packard shares, those slide by 12 percent today after reporting a
huge charge related to alleged fraud at its Autonomy software unit.

And that is it from CNBC. Those are the headlines in business. We`re
first in business worldwide -- now it`s back over to HARDBALL.

MATTHEWS: Back to HARDBALL.

Secretary of State Hillary Clinton landed on choppy diplomatic waters
today when she peeled off from the trip to Asia with the president to wade
into the growing conflict between Israel and Hamas.

Shortly after landing in Israel today, she met with Prime Minister
Benjamin Netanyahu. Let`s watch.

(BEGIN VIDEO CLIP)

HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: President Obama
asked me to come to Israel with a very clear message. America`s commitment
to Israel`s security is rock-solid and unwavering.

The rocket attacks from terrorist organizations inside Gaza on Israeli
cities and towns must end and a broader calm restored.

(END VIDEO CLIP)

MATTHEWS: With her time as secretary of state coming to an end,
Clinton`s diplomatic push in the Middle East -- and it`s a hot one -- will
likely be one of her most climatic acts in this business, in fact, very
much near the end of the term. It could help define her legacy, of course.

For now, we`re joined by a real expert, Robin Wright, a senior fellow
at the Woodrow Wilson Institute. And Steve Clemons, he`s Washington
editor-at-large for "The Atlantic."

It`s great to have you both experts on.

What I`m fascinated by has always been the relationship starting at
the time he named her secretary of state. And she agreed to take it. This
was a mutual agreement. She could have said no and stayed as a very
important senator from New York.

This relationship, is it a familiar one like a president and his --
like Kennedy and Dean Rusk or Truman and Dean Acheson? Is it like that,
where we have a big president and a somewhat smaller Cabinet ministers, or
are they like equals, Robin?

ROBIN WRIGHT, SENIOR FELLOW, WOODROW WILSON CENTER: Well, I think
they`re closer to equals.

MATTHEWS: Yes.

WRIGHT: But this is not Kissinger/Nixon.

Hillary came in as the far more experienced person when it came to
knowing the world. Her husband had been president. She`d toured the
world. He had been very involved in very...

(CROSSTALK)

MATTHEWS: She was an international figure. Yes.

WRIGHT: She was an international figure. Obama was the ingenue in
foreign policy.

I think actually he has become a much stronger president on foreign
policy. I know that there are a couple situations in which she`s come
through with proposals that he`s challenged or not accepted.

MATTHEWS: OK. Quickly, when he -- I always like the way of these
communiques go out. This report the other night wasn`t Hillary Clinton is
going like Chinese Gordon to solve a big dispute, one of those wonderful
moments when Charles Chinese Gordon comes in and tries to deal with the
situation in Khartoum. It was, the president is dispatching her.

I thought that was an interesting way of saying it. It wasn`t like,
I`m going to go.

Is that interesting to you?

WRIGHT: No.

MATTHEWS: OK.

WRIGHT: Look, she`s not going to say, I decided on my own that I
should come here. This...

(CROSSTALK)

MATTHEWS: But she broke off from a diplomatic effort over in the Far
East.

WRIGHT: But this -- he was coming home. This was an initiative that
she -- that the administration wanted to say comes from the president. It
has the White House`s initiative.

MATTHEWS: OK.

WRIGHT: And so that`s important to the process that unfolds.

MATTHEWS: OK. You`re over there and you`re Netanyahu, no friend of
the president, they have a cold peace, at the best. She`s going there --
does Israel want this conflict to end or do they want to use it to
basically clear those missile sites out of Gaza?

WRIGHT: I think it wants security for Israelis and it will do
whatever it takes.

MATTHEWS: Well, does that mean continuing this conflict or ending
it?

WRIGHT: If Hamas doesn`t stop, that means continuing it. And --

(CROSSTALK)

MATTHEWS: I think they`re going to clear the missile sites and then
they can go to Iran if they had to.

WRIGHT: I don`t think the conflicts are necessarily related.

MATTHEWS: Steve, how do you see it? You go see this as part of an
emerging, very much an incipient conflict with Iran that`s coming. We all
know it`s going to mean some form, or is it the usual problem Israel has a
difficult, in fact, violent neighbor that wants to keep bothering them with
missiles.

STEVE CLEMONS, THE ATLANTIC: I mean, bottom line, there`s an
election coming up in Israel and there`s a, you know, strange correlation
between elections and this kind of violence. I think the cabinet in Israel
wants to show how strong it is. But the bigger problem beyond Iran, and
Robin knows this so well, is they`re sort of a tsunami in the region. You
have a rise of political Islamic movements that been democratically elected
and empowered, and they are furious and upset and bonding and reaching out
to those who feel under stress in Gaza.

As I`ve said before, the U.S./Israel relationship is sort of like a
New Orleans levee. It`s working until a big storm comes and Israel has
been unable or unwilling to change the terms of its security in its
neighborhood when I think it`s had ample opportunity to try and do so.

MATTHEWS: How does it work on the ground between the secretary and
president? Are they back and forth on how they deal with this or is she --
does she have a free hand to solve this problem?

WRIGHT: Oh, I think she negotiates and she talks to the White House
quite often, will brief him on any -- what Bibi says to her about what
Israel`s goals are, and again when she goes to Cairo and meets with
President Morsi, which is arguably the most important stop on this trip.

MATTHEWS: Because he`s the mediator.

WRIGHT: And President Obama has developed a very interesting
relationship over the past --

MATTHEWS: I think we have to hold onto Morsi.

WRIGHT: -- with the president of Egypt.

MATTHEWS: Don`t you?

WRIGHT: Absolutely.

MATTHEWS: We`ve got to hold on.

Yes, last word, Steve, how important --

(CROSSTALK)

CLEMONS: But let`s be clear --

MATTHEWS: We`ve always had the deal between Israel and Egypt in the
interest of both countries and our country. Can we keep that deal? At
least there`s some architecture for peace there.

CLEMONS: We`re going to try to keep that deal absolutely. But,
remember, we`re complicit in part of what happened. Obama when he took
George Mitchell`s resignation and he basically moved Dennis Ross out of the
White House, he didn`t put a new program on the table. And when America
walks away from this peace process or an effort to bring the two sides
together and really lay out a plan, violence kicks up.

So we have a bit of complicity and you have -- you are seeing right
now not a strategic presidency from Obama but a reactive presidency and
that doesn`t bode well for this.

MATTHEWS: Yes.

Do you agree with that? If you`re not moving forward you`re moving
backwards on the peace treaty, peace process?

WRIGHT: I think you plod forward or stay -- I`m not sure it`s
unraveling. I still think the amazing thing about all of the changes in
the Middle East is that you still have a commitment of all the key players
to the peace process.

MATTHEWS: I know. It`s not as bad as W where he just did nothing.
Anyway, thank you -- that`s my opinion.

Thank you, Robin Wright, an expert. And Steve Clemons, thank you
both.

CLEMONS: Thank you, Chris.

MATTHEWS: I want to see peace over there but I want to have a long
term problem of Iran dealt with. Anyway, we`ve got a lighter note coming
up, a couple of comedians coming up here who do a great impression of
President Obama that we see and his secret Luther who is out there really
voicing and dramatizing his real feelings. It`s very interesting.

Stay with us. It`s very political. Comedy Central`s Key and Peele
join us next.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: My book "Jack Kennedy: Elusive Hero" is out in paperback,
just came out, in fact, in time for Black Friday. You know that day you
run to the store and buy something good. Well, it`s a great story, this
book, of a hero who became a heroic, beloved president. It makes a perfect
stocking stuffer. There it is, small enough to get into a stocking.

We can always use a good example and he showed it. Why don`t you get
a copy of it? For a fellow HARDBALLer, actually, they`ll probably like it.

By the way, great for Christmas shopping and it`s a great biography
filled with stuff about Kennedy you`ve never heard before.

We`ll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: These guys Key and
Peele on Comedy Central, they`ve got -- they`ve got a guy who imitates me
pretty well.

JIMMY FALLON, COMEDIAN: Yes.

OBAMA: And the premise is I`m sitting in the Oval Office and he`s
got an anger translator named Luther, who I`ll make my little speech, and
then Luther will come on and say -- I can`t actually repeat what Luther --
it`s pretty good stuff.

FALLON: That`s really good.

OBAMA: It`s good stuff.

(END VIDEO CLIP)

MATTHEWS: Welcome back to HARDBALL.

When the president says he likes your show, it can be incredible in
terms of consequence. Just look how the show "Homeland" took off, which I
happened to love.

Anyway, after the president said he watched that, anyway, let`s talk
about this one. Let`s talk about the clip from another show he just said
he liked right there with Jimmy Fallon, Key and Peele.

(BEGIN VIDEO CLIP)

JORDAN PEELE, "KEY AND PEELE": To the American people, I just want
to say that the debates Tare over but now is not a time to tally points or
to keep the score.

KEEGAN-MICHAEL KEY, "KEY AND PEELE": Two-one, Obama, game, set,
match, touchdown, home run, checkmate, can we get back to work now?

PEELE: Governor Romney in the recent debate, I laid out the
inconsistencies in your stated beliefs.

KEY: Governor Romney. Governor Romney, why you smiling while you`re
getting your (EXPLETIVE DELETED) kicked? Are we debating or are you trying
to sell me a Lexus?

PEELE: I directly questioned you about your opposition to the auto
industry bailout.

KEY: On behalf of all the people in Detroit that want to stab you, I
ask again, why are you smiling?

PEELE: I spoke about brinksmanship with Iran and you just said you
wanted a peaceful planet.

KEY: Are you holding that gravy up in here? I`m sorry, Mitt, if you
want to be the first Mormon hippie, you`re going to need to grow your hair
out, dog. And quit smiling. (EXPLETIVE DELETED)

(END VIDEO CLIP)

MATTHEWS: Wow. Joining me right now is Keegan Michael Key and
Jordan Peele otherwise known as Peele.

Gentlemen, I mentioned "Tonight" show, I moved down to the end of the
couch, I`ve been through that experience.

But to get to move to the end of the couch, you got to be on first,
by the way, which is the clip.

KEY: Right.

MATTHEWS: Anyway, I`ve to ask you about, how did you come across
this notion of an alter ego for the president, who is a little more
dramatic, if you put it that? You want to do that, Michael? What was the
spark that led you to believe there must be an invisible Obama who has more
attitude?

KEY: Well, a few years back when Joe Wilson had the "you lie"
statement, Jordan and I were trying to figure out something to write about
the president. We figured we have to have the president in our show, us
being biracial and him being biracial. We discussing that thing about Joe
Wilson, if you said that, a president should be allowed to react to that
comment. And then he just didn`t -- he just can`t because of who he is.

So, we figured out, gosh, we have to have somebody speak for him.
And that could work for us comedically.

PEELE: That`s right.

KEY: That was one aspect.

PEELE: So, we`re sort of pacing around my house, my apartment and
trying to -- you know, we wanted to find that voice for the president. But
also, you know, my -- you know, my partner Keegan, he`s pretty excitable,
like he gets going. He`s like Cory Booker with three Red Bulls, you know
what I mean? He gets pretty heated.

So we found this -- we found this sort of two-man impression that
would also sort of allow people to, you know, have this moment of catharsis
and release of things that a lot of people know but not a lot of people are
talking about.

MATTHEWS: We have -- go ahead. Here`s another clip following the
second presidential debate where the president turned his guns on the other
guy. Luther, the president`s anger translator, and the president
deconstruct the night, they go over it, the way you do after a big night.
Let`s listen.

(BEGIN VIDEO CLIP)

PEELE: He was proud of his efforts to include qualified women in his
cabinet.

KEY: You made it sound like finding a qualified woman is like
hunting down a sasquatch, riding on the back of unicorn, reading the
specifics of your tax plan.

PEELE: He even drew a tenuous connection between single parent
households and gun violence.

KEY: That`s right. Yes, children of single parents usually grow up
to use AK-47s. Or become the president.

(END VIDEO CLIP)

MATTHEWS: Wow. Tell me what -- I always liked the few minutes I had
with the president. They are scarce and rare. But he always has this
other level to him, which is very cool, very funny, very hip.

KEY: Yes.

MATTHEWS: Do you want -- Jordan, you want toe start on that, what it
was like to chat with him?

PEELE: That`s right. We got to meet him at the Beverly Hilton,
where he was staying, after that whole big Clooney thing, where the real
stars were. We got a special meeting.

First thing he says, he looks at Keegan and goes, now, I need Luther.
I need him. Going to have to wait until second term, but I need him. You
know?

So, he`s like out of the gate, he was pretty hilarious. You know, it
was just the best experience of our lives. We got bro hugs from him. And
he said, you know, I know it`s hard for a brother on TV, I know it. You
know?

(LAUGHTER)

PEELE: Sort of emotive, you know, he puts his hand on you shoulder -
- on your shoulder. Just really sort of warm guy.

MATTHEWS: Yes, he is that way. He`s very -- I wonder whether he
rehearses this stuff ahead of time because it`s so to the point.

PEELE: Yes.

MATTHEWS: Michael, you guys come from mixed parents, black and white
parents. This thing about one of you guys were -- it was Peele the other
night talking to me about how you guys can tell jokes that nobody else on
the planet can tell, like football players` names, the birth names. They
can be pretty original.

KEY: With my name, my name is, you know, Keegan-Michael Key, and
I`ve been cursed with this name my whole -- in fact, in this very broadcast
you`ve called me Michael, which is certainly not your fault because my
parents gave me a weird name.

(LAUGHTER)

MATTHEWS: Well, what did they call you at home?

KEY: Oh, Keegan. They call me Keegan at home.

MATTHEWS: OK.

KEY: Yes. But I mean, it`s like, you know, so because of my name,
I`m fascinated with really interesting names. I think it`s a testament to
the mother`s imaginations. I think they want their kids to have really
good names or really interesting names that nobody else has. But part of
it is being biracial, I think both Jordan and I can be -- we`re kind of
like racial referees, in a way, because we straddle both cultures -- and as
does the president in a particular way.

MATTHEWS: I guess he does.

So it`s like Thomas Jefferson, you know, he used to have a bed you
could walk into either room, depending on what side of the bed you got out
of but he had a biracial experience himself, come to think of it.

KEY: Yes, he did.

MATTHEWS: Seven of them, at least.

Anyway, thank you, guys. Good luck with everything you`re doing --
Keegan-Michael Key and Jordan Peele.

PEELE: Thank you, Chris.

KEY: Thanks a lot, Chris.

MATTHEWS: When we return, let me -- when we return, let me finish
with President Obama`s second term and the need I need to go for greatness
like he did for the first time.

By the way, Vice President Joe Biden is celebrating his 7-0 today,
his 70th birthday. He`s a youthful kind of guy, don`t you think? We want
to wish the vice president happy 70th.

You`re watching HARDBALL -- that`s what 70 looks like these days.
HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Let me finish tonight with this:

The Obama second term -- I don`t know anyone who doesn`t want it to
be better than the first. Yes, he did valuable, historic things in the
first four years, but I want him to join the list of truly great
presidents.

And for that I have advice. Go high, fill your cabinet with top
people. Go for the people you couldn`t get your first term. Don`t promote
people. Get out and get the best, like Mike Bloomberg for treasury
secretary. Get people who are difficult to deal with, people with egos and
separate distinctions, principles.

Don`t head to the second term by filling your White House and cabinet
with people you`re comfortable with. Fill it with the highest, toughest
talent you can find, people who got there on their own without your
assistance.

I`ve seen a lot of second terms become disasters. They do it because
presidents became -- make lazy decisions. Ike made Sherman Adams a second
term chief of staff, a disaster and a crooked one. Nixon had yes men, and
worse than that, Ike had imagined.

Reagan blew it with Iran-Contra by letting his staffers pick his
second term chief of staff. Don Regan was an unmitigated disaster of no
political talent whatsoever.

Clinton just did not have people around him who were ready to step up
and keep him from the problem of Monica, something they saw but didn`t
stop.

Everyone who voted for Barack Obama wants this presidency to end on
an upward trajectory, yet going from big challenges and getting the best
possible people around him, as confederates in the U.S. Senate, as strong
government ministers in the cabinet around him.

Go for it, Mr. President. Good isn`t great. Great is great.

And that`s HARDBALL for now. Thanks for being with us.

"POLITICS NATION" with Al Sharpton starts right now.

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

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