updated 11/21/2012 9:45:23 AM ET 2012-11-21T14:45:23

THE ED SHOW with ED SCHULTZ
November 20, 2012

Guests: Bernie Sanders, Leo Gerard, Barbara Lee, Henry Winkler; Patrick Murphy

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

Liberals, this is no time to get weak kneed about the fiscal cliff.
We won the election.

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

(BEGIN VIDEOTAPE)

NARRATOR: We need Senators Warren and Webb, Senator McCaskill,
Senators Bennett and Udall to continue to stand up for us.

SCHULTZ (voice-over): The air war begins in the fight for the middle
class. Senator Bernie Sanders, Leo Gerard of the Steelworkers, and Barbara
Lee on today`s big fiscal cliff developments.

Congressman Jim Clyburn calls out the racial undertones in the attack
on Ambassador Susan Rice.

REP. JIM CLYBURN (D), SOUTH CAROLINA: You know, these are code words.

SCHULTZ: Michael Eric Dyson and Karen Finney are here with reaction.

Congressman Allen West finally calls it quits.

REP. ALLEN WEST (R), FLORIDA: We`re not going to contest the
certified results.

SCHULTZ: The man who beats the Tea Party icon joins me exclusively.

And it`s the world according to the Fonz.

UNIDENTIFIED MALE: There are two kinds of people: cool and nerds.
And people (INAUDIBLE) are nerds.

SCHULTZ: Tonight the legendary Henry Winkler on the traditional
America and the reelection of President Barack Obama.

(END VIDEOTAPE)

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

Democrats still have the upper hand in the fight for the middle class
in this country. But it is time to make sure that the party stays unified
on the issue of debt reduction.

"Bloomberg News" and "The Wall Street Journal" reported on nervous
Democrats in the House and Senate who were wary about pushing hard for tax
hikes for the wealthiest Americans. Among them are seven senators up for
reelection in 2014 in solidly red state states.

The centrist think tank Third Way gave them some ammunition with a
polling memo showing most Americans want compromise in Washington.

Third Way, what about the people`s way? What about the voters` way?
Folks, compromise does not mean giving Republicans everything they want and
you know that Paul Ryan is going to be greedy when he comes to the table.
The most important poll I believe was taken on November 6th.

Americans are on board with higher taxes for the wealthiest Americans.
Labor groups have take on to the airwaves to directly address the
Democratic lawmakers who are making this deal.

(BEGIN VIDEO CLIP, POLITICAL AD)

NARRATOR: How do we move our country forward and reduce the deficit?
By creating jobs and growing our economy. Not by cutting programs that
families rely on most.

We need Senator McCaskill to continue to stand up for us. We need
Senators Bennett and Udall to continue to stand up for us. We need
Senators Warner and Webb to continue to stand up for us by investing in job
creation, extending the middle class tax cuts and protecting Medicare and
Medicaid and education from cuts, because for working families, it`s all
about putting Americans back to work. Not cutting the things we rely on
most.

(END VIDEO CLIP)

SCHULTZ: This is just one part of the continuing campaign to
strengthen and support the middle class in this country. On a conference
call last week, President Obama made a direct personal appeal to 30,000 of
his top campaign activists. He says it`s not time to let up.

The president told supporters he will barnstorm across the country to
keep people engaged in negotiations over the talks.

But the president`s allies also plan on harnessing the power of the
Obama campaign, including the Dashboard, a social network built by the
Obama team. The campaign manager says Dashboard helped win the election.
It will now be used to promote the president`s agenda.

(BEGIN VIDEO CLIP)

JIM MESSINA, OBAMA CAMPAIGN MANAGER: You could see people using
Dashboard to say, OK, I want to talk about the choices in front of us in
the fiscal cliff and I want to start organizing my friends to -- you know,
Dashboard would be very easy to start a group. We did over 350,000 events
on Dashboard the last couple of months of the campaign. It would be easy
for supporters today to go and start asking people to call members of
Congress.

(END VIDEO CLIP)

SCHULTZ: The biggest asset for Democrats in these negotiations is
Republican stubbornness. Here`s Tea Party Senator Rand Paul out of
Kentucky, addressing incoming Republicans about the fiscal cliff.

(BEGIN VIDEO CLIP)

SEN. RAND PAUL (R), KENTUCKY: But the bottom line is it`s a mistake
to raise taxes on anybody we shouldn`t in on it. Those who are new here,
please hold the line. Now, there`s one compromise I would be in favor of
and that`s that all spending should be cut.

We compromise enough to say, let`s look for some waste in the military
budget. The liberals, though, have to compromise and say entitlements have
to be fixed.

(END VIDEO CLIP)

SCHULTZ: Despite losing the election, Republicans still have a very
much my way or the highway attitude about all of this. They have less
leverage now than think ever had on this issue.

Today, "The New York Times" reported on more defections from Grover
Norquist`s anti-tax pledge. Hard line conservative Congressman Peter King
of New York is the latest who marginalized the number one conservative
lobbyist in Washington. King said, "A pledge is good at the time you sign
it. In 1941, I would have voted to declare war on Japan. But each
Congress is a new Congress. I don`t think you can have a rule you`re never
going to raise taxes, or that you`re never going to lower taxes. I don`t
want to rule anything out."

You mean there`s actually a level-headed Republican out there in the
House that wants to talk about this?

Republicans shouldn`t rule anything out because the Democrats are
giving them one hell of a deal to go home with. That`s a fair deal. The
president has on the table right now, let`s keep the taxes where they are
for 98 percent of Americans.

How can Republicans not campaign on that? They are going to be able
to go home and say, hey, I didn`t raise your taxes. Not if you`re the 98
percent of Americans. It`s the top 2 percent that have to pay more. They
won`t even buy into that if you listen to Rand Paul.

Here`s what the Democrats want to do. They want to reinstate the
Clinton era tax rates. This would bring in -- here`s the number -- $442
billion in revenue. Democrats want to restore the 2009 estate tax level.
That`s $119 billion.

Democrats also want to reform on unearned income, which would total
$465 billion. You know, that`s the Mitt Romney rate at 15 percent when you
make a lot of money. The Democrats want to change that. That, of course,
was what the president campaigned on.

The president is going to go out on the road and he`s going to sell
this.

There was a clear distinction in the election between the economic
vision of the president and the challenger. America has chosen the
president. If Republicans want to go against the tide, it`s going to cost
them in 2014.

I think as a politician, you`re going to have to look at this. Where
is the country?

But if you listen to Rand Paul, the ideologues are still out and about
and they are going to fight President Obama tooth and nail on this. It`s
time for liberals in this country to realize the results, hold the line and
don`t back down.

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

Tonight`s question: who will Americans punish for failing to reach a
deal? Text A for Democrats, text B for Republicans, to 622639. You can go
to our blog and leave a comment at Ed.MSNBC.com. We`ll bring the results
later on the show.

Let`s bring in Senator Bernie Sanders, independent from Vermont.

Senator, good to have you with us tonight. I have taken a couple --

SEN. BERNIE SANDERS (I), VERMONT: Good to be with you, Ed.

SCHULTZ: You bet. I have taken a couple of phone calls already from
Democrats telling me that there`s no perfect deal out there. Well, we had
a decision on November 6th and I thought the distinctions between the two
campaigns were very clear.

If there`s no perfect deal out there, Senator, what would you be
willing to give up, or should I say, are you nervous about Democrats caving
in on tax hikes for the wealthiest Americans? We`ll go there first.

SANDERS: Ed, you know, we saw this movie in 2010 and 2011, and what
people don`t understand is that despite the growing income, the wealthiest
people in those agreements did not pay a nickel more in taxes and yet we
cut $900 billion in programs that the middle class and working families of
our country desperately need.

That must not happen again in 2012. As you just indicated, Mitt
Romney and the Republicans ran on a program which says, do not ask the
rich, do not ask large corporations to pay more in taxes. They lost. They
lost bad.

And what the Democrats must demand is that we rescind the bush tax
breaks for the wealthiest people in this country.

Furthermore, poll after poll makes it explicitly clear that the
American people do not believe we should cut Social Security, Medicare and
Medicaid. They believe that the wealthy, large corporations should start
paying their fair share of taxes.

SCHULTZ: McConnell -- OK. Go ahead. Last point?

SANDERS: Last point. Just in terms of fairness, people on top are
doing phenomenally well.

SCHULTZ: Yes.

SANDERS: Last study we saw, over 90 percent of all new income went to
the top 1 percent. Median family income for the middle class is going
down. Who is better prepared to help us with deficit reduction --
struggling working people or people on top doing well?

SCHULTZ: And I think that was answered on November 6th.

Now, the proposals are going to be coming in next week. What changes
would you be willing to make to Medicare because the Republicans, you heard
Mitch McConnell, you`ve got to have entitlement reform, is what he calls it
-- entitlement reform to the Republicans is cuts. That`s what their
entitlement reform is.

Would you do anything to Medicare at all?

SANDERS: Sure. Look, Ed, what has to be understood is are we not
only the country in the industrialized world that doesn`t healthcare to all
people, a national healthcare programs. We pay by far much more per capita
for health care than does any other nation. It is a very wasteful system.

For example, in terms of Medicare, Republicans demanded as part of
Medicare part d that the Medicare could not negotiate drug prices with the
pharmaceutical industry. The V.A. does that. Why isn`t Medicare doing
that?

Furthermore, if we can develop efficiencies that save the system
money, let`s do it. But let us not cut benefits for the elderly or for the
poor who are on Medicaid.

SCHULTZ: Yes.

Finally, Senator, are you willing -- if the Republicans can`t do a
deal, are you willing to allow all of the tax cuts to go? I mean, what
will that do for the country? I mean, if the Bush tax cuts completely
expire, and you can`t strike a deal -- what`s it going to do?

SANDERS: Well, I think no deal is better than a bad deal. Next
session, we`re going to have more people, more Democrats in the Senate,
including some strong progressives.

And the first piece of legislation I expect that Harry Reid would
bring up in the Senate would be to maintain the tax breaks for the bottom
98 percent and challenge the Republicans to say no to that.

SCHULTZ: All right. Senator Bernie Sanders, thanks for your time
tonight. Appreciate it so much.

Joining us now is United Steelworkers International president, Leo
Gerard.

Mr. Gerard, great to have you onboard with us.

How committed is labor to continuing the campaign for the president`s
agenda? Is this just an extension of what you just went through?

LEO GERARD, PRESIDENT, UNITED STEELWORKERS: We`re totally committed
to this agenda, Ed. In fact, we had a conference call today where we`re
looking at what our strategy is going to be. As we said, our folks are
ready and willing to start to talk to those senators. We`ll knock on doors
if we have to. We`ll go back to do an old kind of work we did in the
election campaign.

But let me say a couple things, Ed. I think we`re having part of the
wrong debate here. This isn`t a fiscal cliff. This is a slope.

And what we need to do is understand that the deficit is a long-term
challenge and the best way to reduce the deficit is to get people back to
work. Right now, the price of money is cheap. You can almost get it for
free. This is the time when we should be investing in more economic
development. We need to be fixing our infrastructure, rebuilding what --

SCHULTZ: So should this be part of the package, in the negotiations?

GERARD: Absolutely. Absolutely. I think what we need to do is -- I
want to back up a bit. We`re not raising taxes. The Bush tax cuts were
designed to expire.

SCHULTZ: Yes.

GERARD: So we`re saying let them expire. That`s how they were
designed. But don`t let them expire for the people under $250,000.

And then make part of that debate, you`re not going to touch Medicare
and Social Security unless you do like Senator Sanders said, start to
bargain on the price of drugs, find some efficiencies. But don`t damage
the planned participants.

But then put money back into rebuilding the infrastructure of America.
Put people back to work. The jobs that will be created will lower the
deficit instead of trying to beat up on poor people and working people
again.

SCHULTZ: OK. The art of the deal, many people think the art of the
deal has left Washington and that this is going to be more stalemate. But
are you confident that Democrats in red states will come around and hold
the line and not worry about 2014?

GERARD: I think one of the things we should look at is how much of
the Tea Party crowd got defeated in the election whether it was Allen West
or whether some of the folks. They didn`t get defeated just because of
their attacks, they also got defeated because it was bad policy and they
were tying themselves to Mitt Romney.

Ed, the most important to understand is that the president won the
election by more than 3 million voters. And he won a huge majority in the
Electoral College. America has voted for his agenda, not Mitt Romney`s
agenda, not Mitch McConnell`s agenda. Mitch`s big challenge --

SCHULTZ: But you`ve got Democrats who are already nervous. I mean,
they are quoting this Third Way poll out there saying that the country
wants compromise. Does that -- compromise, does that mean caving in?

GERARD: The best compromise is that the Republicans ought to start to
understand that they are the ones that have caused this mess by trying to
hold up the president`s agenda for four years. Democrats don`t need to
compromise. The president won on an economic agenda that included
rebuilding the manufacturing base, fixing the infrastructure, letting the
Bush tax expire not for the bottom 98 percent, but for the top 2 percent.
And any Democrat that gets weak knees on that isn`t a real Democrat.

SCHULTZ: All right.

GERARD: And they ought to remember what happened to Blanche Lincoln.

SCHULTZ: All right. Leo Gerard, great to have you with us tonight,
from the Steelworkers. Appreciate your time.

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

Coming up, Republicans are gambling with the lives of millions of
American families. Some of the nation`s most conservative economists think
the Republicans are wrong on this issue.

And when we come back, breaking news on the Hostess mediation.

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: And breaking news at this hour. Hostess Brands has failed
to make a deal to save 18,000 jobs. Yesterday, Hostess told a bankruptcy
judge it wants to fire 18,000 workers and sell off its equipment. The
judge ordered Hostess the company into mediation instead.

The talks fell apart late this afternoon. It`s not surprising after
years of mismanagement, the company asked workers to sacrifice more than 20
percent of their salary and wages. The workers refused.

The company is almost $1 billion in debt. Although the company still
wants the judge to approve almost $2 million in bonuses for top executives.

The bankruptcy hearing will continue tomorrow and the judge will
decide if the company can liquidate.

Coming up, the real casualties in the fiscal cliff faceoff.
Congresswoman Barbara Lee will join me next.

Stay with us.

(COMMERCIAL BREAK)

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

It`s happening again. The millions of Americans who have been hit the
hardest by this recession are becoming a political pawn for the
Republicans.

On December 29th, millions of Americans could lose the only income
they`ve got, emergency unemployment compensation. Yes, that`s on the line.
It will end if Congress doesn`t act.

The Republicans -- well, they want to trim the budget and leave
Americans without a safety net. More than 12 million Americans are still
unemployed. Five million have been out of work for more than 27 weeks.
Federal unemployment insurance helps them feed their families while they
look for work.

They are up against one of the worst job markets in decades.

(BEGIN VIDEO CLIPS)

UNIDENTIFIED FEMALE: You grew up with the idea that you work hard,
and you go to school and you work hard, and you keep working hard and, you
know, life was going to be OK. And it`s just not true anymore.

UNIDENTIFIED FEMALE: I know we have the unemployment office. But if
there`s not any jobs to have, they can`t really send them anywhere.

UNIDENTIFIED FEMALE: Keep moving, keep pushing, and hoping that, you
know, the person next to me, you know, doesn`t have it as bad as I do.

(END VIDEO CLIPS)

SCHULTZ: But the Republicans want to go after it.

Unemployment benefits aren`t just a handout, they are one of the most
cost effective way to boost the economy.

Moody`s warned Republicans that they will endanger the economy if they
don`t renew benefits. Cutting benefits would reduce it by $58 billion next
year. On a personal level, unemployment benefits lifted more than 2
million Americans out of poverty last year. Six hundred thousand of them
were children.

Extending unemployment benefits will help those families and help the
economy. Those benefit checks shouldn`t be trade bait for the Republicans
when they come to the table to talk about how to move the country forward
financially.

Why pick on the most vulnerable? The Republicans always seem to love
to do that.

Joining me now is Congresswoman Barbara Lee of California.

Great to have you with us, Congresswoman.

I know you have personally worked hard on this and been an advocate
for those who have been less fortunate in our economy.

Are Republicans, do you think, are they going to hold unemployment
hostage in these negotiations?

REP. BARBARA LEE (D), CALIFORNIA: Let me tell you, Ed. I`m so glad
you`re focusing on this because, of course, we have now, as you said
earlier, so many people who will lose their unemployment benefits on
December 29th. We have 2.1 million people who could lose these benefits.

And I have to tell you, I hope that the Republicans understand that
many of these individuals are their constituents.

Unfortunately, during the last negotiations, unemployment benefits
were reduced from 99 weeks to about 73, 74 weeks. I could not support
that.

I hope this time around that those who are unemployed are not put on
the chopping block in terms of their benefits being cut. We have now, Ed,
nearly 50 million people living in poverty, 16 million of whom are
children. And we need to help people until we turn this economy around.

This is a safety net. It`s a bridge over troubled waters.

SCHULTZ: It`s not a bargaining chip? Because, you know, in the last
lame duck session of the Congress, the Republicans were willing to extend
these benefits for one year to get two years of an extension to the Bush
tax cuts. Is that off the table?

LEE: Well, I`ll tell you one thing, let`s hope that`s not on the
table. I don`t want to see people -- the most vulnerable, low income
individuals, the working poor, and many of these people who are in the
ranks of the poor are the working poor. We don`t want to see people who
have been unemployed for 27 weeks or longer, the long-term unemployed, they
do not need to be part of the game that`s being played to get to some kind
of an agreement.

We need to make sure that they are not a pawn in this and we do not
balance the budget or, you know, move forward on this cliff. I call it a
human cliff -- with them being at risk.

SCHULTZ: OK.

LEE: So we have to make sure that the millionaires and billionaires
pay their fair share and make sure the most vulnerable are protected.
That`s the unemployed.

SCHULTZ: Well, let me play devil`s advocate here for a moment, kind
of plays in to the last block we just did.

A lot of things are ending up off the table here. The Democrats want
to raise taxes on the wealthiest Americans. You don`t want to hit Social
Security, Medicare or Medicaid. And now, of course, you want to protect
the unemployment benefits.

Where are you willing to give up? I mean, if unemployment benefits,
if the weeks aren`t going to be reduced or the payments aren`t going to be
reduced, where would you suggest going?

LEE: Well, I have to tell you first of all, we can`t go into cutting
those who have already paid a big price for the last deal. We need to look
at defense, Ed. When you look at where we can actually cut, you know,
there`s billions of dollars in waste, fraud and abuse at the Pentagon.

When you look at the huge tax cuts of millionaires and billionaires,
we need to make sure we do not extend those tax cuts. When you look at the
oil subsidies that oil companies received -- I mean, there are many ways to
move forward and stop this human cliff from occurring.

But we do not need to go with seniors, we do not need to do this on
the backs of seniors, low-income individuals, the unemployed and the poor.
It just doesn`t make any sense. Ed, it`s not fair and it`s morally wrong.

SCHULTZ: I think it is morally wrong and it`s not fair. And I think
there is a moral obligation to help the poor and those trying to recycle
back into the economy.

But do you feel confident that the Democrats will hold the line for
the less fortunate?

LEE: I feel very confident that the Democrats will hold the line for
the least fortunate.

SCHULTZ: OK.

LEE: When you look at what`s happening in all of our districts,
Republican and Democratic district, we have people who are unemployed. We
have the long-term unemployed. And we have people who want to work.

We need to create jobs and invest or resources in workforce training
and job creation. That`s who you we turn the economy around and reduce the
deficit.

SCHULTZ: All right. California Congresswoman Barbara Lee, thanks for
joining us on THE ED SHOW tonight.

Coming up, after two weeks, Allen West finally calls it quits in his
fight to keep his House seat. Well, he didn`t keep it. Tonight, we`re
talking to the Congressman-elect Patrick Murphy, the man who beat the Tea
Party firebrand. He`s coming up next.

Then, the attack on Susan Rice goes beyond politics. The Republicans
are getting back at some old habits and nasty name-calling. We`ll break
their code when we come back.

Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: And we are back.

Tea Party rock star Allen West fought hard in a desperate attempt to
keep his House seat. Well, it didn`t work. West granted -- he was granted
a recount, but after the results came back, he lost by even a wider margin
than before. So today after two weeks of kicking and screaming, West
finally called it quits.

He, of course, did all of this over on FOX News to concede.

(BEGIN VIDEO CLIP)

BRIAN KILMEADE, FOX NEWS: Before you go off to Thanksgiving, you have
an announcement to make.

REP. ALLEN WEST (R), FLORIDA: Yes. Good morning, happy Thanksgiving
to you and everyone. And we`re not going to go forth and contest the
certified results that St. Lucia County sent up. We`re going to move ahead
and we wish Congressman Murphy, elect, very well.

(END VIDEO CLIP)

SCHULZ: He lost his House seat but he still thinks he`s a leader.

(BEGIN VIDEO CLIP)

WEST: Leaders don`t need a title in order to continue to lead and
also to be a voice.

(END VIDEO CLIP)

SCHULTZ: Well, West is right. Failed Republicans don`t need a title
to have a voice. They just have to go to work for FOX News.

So to help West gain employment, we put together his audition tape.

(BEGIN VIDEO CLIP)

ALLEN WEST (R), FORMER FLORIDA REPRESENTATIVE: I believe there is
about 78 to 81 members of the Democrat Party that are members of the
communist party.

You have this 21st century plantation that`s been out there where the
Democrat Party has forever taken the black vote for granted. And now, the
people on that plantation are upset because they have been disregarded,
disrespected. So, I`m here as the modern day Harriet Tubman to kind a lead
the people on the underground rail road away from that plantation.

If you`re feeding a person that crap sandwich with a smile, it`s still
a crap sandwich. And I think that what you see coming from President
Obama.

We are against something that`s a totalitarian, theocratic, political
ideology and it`s called Islam.

We`re creating economic dependency and I call it slavery.

UNIDENTIFIED FEMALE REPORTER: Are you saying Maxine Waters is the
plantation boss at this point?

WEST: Well, absolutely.

(END VIDEO CLIP)

SCHULTZ: It looks like Florida voters had enough of West`s rhetoric
and sent him packing. He will still be around. I`m sure FOX will book him
allot. Of course, I`ve asked Allen West to come on this program, but he
won`t go face to face with me. Maybe he will now that he is not an elected
official anymore.

Joining me now is congressman-elect Patrick Murphy of Florida, who
beat Allen West for his house seat.

Congratulations, Mr. Murphy. Good to have you on "the Ed Show"
tonight.

REP. PATRICK MURPHY (D), FLORIDA: Thanks, Ed. Thanks for having me
tonight.

SCHULTZ: You know, you are exactly what Republicans love to put up in
front of a crowd. You are a successful businessman. You understands small
business. I have done some research on your background. What was the
difference? Did the rhetoric of Allen West really put you in this seat?

MURPHY: Well, it was a few things. It started off with his rhetoric.
You know, that offended a lot of Republicans. We were getting phone calls
from Republicans saying Patrick look, we`re tired of the tea party. We are
tired of Allen West. We want someone with your background as a CPA, as a
small business owner representing us.

So, it was part of my campaign about showing the difference between
Allen West and myself. But also, talking about what I want to do going
forward and why I thought I was the better candidate moving this country
forward.

SCHULTZ: One of the right wing talking points is that the Democrats
have put so many regulations on small businesses. I`d like you to speak to
that.

MURPHY: Sure. Well, when it comes to things like regulations. It`s
not about more or less regulation, it`s about smarter regulation. I spent
about four years as an au auditor for numerous fortune 500 companies
looking at a lot of regulation such as (INAUDIBLE). I have seen firsthand
what works and what doesn`t. Then my time cleaning up the BP oil spill,
saw a lot of regulations there and what needs to be done to make those more
transparent and easier for businesses to understand. And unfortunately,
there`s such a big difference when it comes to regulations as to how they
apply to the fortunate 500 companies and how they apply to the small
business in the mom and pops trying to make it.

SCHULTZ: Congressman Murphy, you said in a debate that you would draw
the line at a million dollars when it comes to raising taxes. President
Obama wants people making $250,000 and more to pay taxes. That`s a
difference between you and the president. If the president asks for your
vote tonight, would you give it to him or hold the line at a million
dollars? Where do you stand on tax revenue?

MURPHY: Sure. Well, being a CPA, I have studied the tax code. And
unfortunately, it`s riddled with loopholes and deductions. If we`re going
to be serious about, you know, making sure we don`t fall off the fiscal
cliff, that we do have economic stability going forward, we`re going to
have to really look at our tax code from scratch.

And I said the million dollars because so many businesses out there
want to keep that money invested in their companies. So that`s why I have
the line at a million dollars. But if we`re going to be serious, you know,
first thing I said I want do is sit down with a Republican and find that
compromise to ensure that we move the country forward in a sustainable
fashion.

SCHULTZ: OK. But the president wants to extend the Bush tax cuts and
the tax rate for the lower 98 percent income earners. You would be against
that?

MURPHY: Well, of course, I don`t want to raise taxes on the middle
class, but I`m fiscally more conservative than the president. So that`s
where I stand. I`m not saying I wouldn`t compromise because there`s a
bigger picture at hand here. That`s where I drew the line, but we have to
do what`s best for all Americans.

SCHULTZ: OK. Congressman Patrick Murphy, congratulations. There`s a
lot of people that are happy that Allen West is no longer around. Good
win. Thank you.

MURPHY: Thank you very much.

SCHULTZ: You bet. There`s a lot more coming up in the next half hour
of "the Ed Show." Stay with us.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: These kinds of terms that those of us, especially
those of us raised in the south, we`re hearing these words and phrases all
our lives. We get insulted by them.

SCHULTZ: Congressman James Clyburn says there`s a racial aspect to
the attacks on Ambassador Susan Rice.

Michael Eric Dyson and Karen Finney will weigh in.

Scott Walker kicks off the block the vote campaign for 2016.

GOV. SCOTT WALKER (R), WISCONSIN: We have to do more to protect the
integrity of the vote.

SCHULTZ: We`ll tell you how the Wisconsin governor wants to make it
harder for Wisconsinites to vote.

And tonight we`re talking politics with the Fonz himself.

UNIDENTIFIED MALE: Eight years ago, I thought to myself, OK, we have
this president of the United States Dick Cheney and Bush, just give him a
shot. Now we can make it right.

SCHULTZ: Henry Winkler joins us to talk about President Obama`s re-
election and GOP road blocks.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to "the Ed Show."

Instead of focusing on budget negotiations, nearly 100 Republicans are
spending their time targeting ambassador Susan Rice. Senator John McCain
actually insulted her intelligence.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: Is this a select committee if
appointed clears her of wrong doing besides not being very bright because
it was obvious that this was not a quote "flash mob"? There was no
demonstration, Charlie. There was none there.

(END VIDEO CLIP)

SCHULTZ: Let`s see. She`s a graduate of Stanford and also Rhode
scholar.

Republicans claim Ambassador Rice misled the public about the attack
on the consulate in Benghazi. It turns out Rice was actually reporting the
intelligence that she had been given. The Republicans don`t seem to care
about the facts. They are worried that the president will appoint Rice to
be the next secretary of state.

John McCain says Rice isn`t qualified. Senator Lindsey Graham calls
Rice a political choice for ambassador and says it`s not a good resume to
be secretary of state. Ninety seven House Republicans signed the letter to
the president accusing Rice of willfully or incompetently misleading the
public. The Republicans are using words like not qualified, not bright,
and incompetent. Some Democrats feel these words are actually code.

(BEGIN VIDEO CLIP)

REP. JIM CLYBURN (D), SOUTH CAROLINA: You know, these are code words.
We heard them during the campaign. During these recent campaign, we heard
Sununu calling our president lazy, incompetent. These kind of terms for
those of us who grew up in the south, we have been hearing these phrases
all our lives and we get insulted by them.

(END VIDEO CLIP)

SCHULTZ: Let`s bring in Georgetown University professor Michael Eric
Dyson, also author of the book "can you hear me now"? And former DNC
communications director Karen Finney, who will be guest hosting for Martin
Bashir 4:00 tomorrow afternoon.

KAREN FINNEY, MSNBC POLITICAL ANALYST: Thanks, Ed.

SCHULTZ: I`m looking forward to it.

All right. This is really down in the gutter. Dr. Dyson, are
Republicans using code words to attack the ambassador?

MICHAEL ERIC DYSON, PROFESSOR, GEORGETOWN UNIVERSITY: Very clearly
so. This woman is an undergraduate of Stanford, as you said. A doctor of
philosophy besides a Rhode scholar at Oxford at the age of 26. So, clearly
she is an intellectually brilliant woman who is quite capable. It`s ironic
and tragic that John McCain, who nominated or at least put Sarah Palin on
the ticket as vice president would dare call into question anybody`s
intelligence. Sarah Palin`s intelligence could fit into the left
fingernail of Dr. Susan Rice.

SCHULTZ: Yes.

DYSON: But beyond intelligence, there`s a racial hostility that`s
unchecked here. And the aggression toward people of color here has been
unleashed as a kind of compensatory aggression against Obama`s win. So,
you see all this stuff going on. And as Jim Clyburn said, this is racial
code words and we know the manipulation of racial feeling and sentiment
here.

SCHULTZ: Well, now that the intelligence -- Nobody in the
intelligence community has come out and said these things about Rice.

Karen, what about this? Why is she a target?

FINNEY: You know, I just want to say, I worked with Dr. Rice back in
the Clinton administration. She is, as Dr. Dyson just said, a brilliant
woman and a gifted diplomat. So take that off the table. Here`s the
thing. Even if the Republicans are too stupid to understand that after
having just lost an election largely because of -- they lost the woman
vote, they lost the young vote, they lost the African-American vote, that
taking on a woman of this level of credentials in a hearing with mostly
white men, a relatively young African-American woman, it`s just a bad idea.

And particularly given that she is very well qualified and given that
these are also people who tried to say as Dr. Dyson said, Palin and Harriet
Meyers were qualified. And in this instance, here`s what really is so just
infuriating on this, Ed. These guys all have the exact same intelligence.
They knew that there was a CIA operation operating out of that facility and
that potentially that`s part of why there were certain things that had to
remain classified versus unclassified. They knew it. So this whole game
is all the more politicized. And you know, what it makes it seem like they
just don`t want this dynamic woman to rise any higher.

SCHULTZ: Yes. Here`s Congresswoman Marcia Fudge. She had reaction
to the attacks on Rice. Here it is.

(BEGIN VIDEO CLIP)

REP. MARCIA FUDGE, OHIO: I mean, Susan Rice`s comments didn`t send us
to Iraq and Afghanistan. Somebody else`s did. But you`re not angry with
them. It`s a shame that any time something goes wrong they pick on women
and minorities. I have a real issue with it. For you who are haters, as
the young people say, your hate is going nowhere.

(END VIDEO CLIP)

SCHULTZ: Dr. Dyson, does John McCain hate Susan Rice?

DYSON: Well --

SCHULTZ: I mean when he says she`s not qualified and questions her
intelligence, your thoughts?

DYSON: Well, there`s no question hate here has used as a metaphor to
talk about stern resistance and unjustifiable opposition. And in that
sense, of course, he`s hating on her. I`m not speaking about his personal
animist told her as a human being, but it`s more disturbing that despite
her extraordinary intelligence, the pedigree of her scholarly achievements
and the way she`s moved in several administrations to act in a very
powerful fashion to represent her diplomatic community, what else can you
conclude. But the fact that he`s trying to go after her because as Ms.
Finney so brilliantly said, she`s a woman and black and given that they
have not done very well, the Republicans with this group, it seems to me
just pig headed and silly-minded for them to go after this particular woman
who is the representative of the best possibility of American diplomacy
being carried on in the absence of Hillary Clinton. So, I think we should
be quite clear about that.

MURPHY: The other thing, I mean, think about this. The president of
the United States -- this also goes to this deep resentment I think a lot
of us have about the lack of respect they have shown the president.

The president came out and addressed this issue. The president was
very clear about what happened. And then Susan Rice came out and talked
about what happened. When did the GOP actually change their tune on all of
this? After they heard from general Petraeus. They should have taken the
word of the president.

SCHULTZ: Karen Finney and Michael Eric Dyson, great to have you with
us tonight. Thanks so much.

DYSON: Thanks.

FINNEY: Thanks, Ed.

SCHULTZ: Governor Scott Walker has tried it before and he wants to
try it again. It is voter suppression. That`s right, just days after the
election, he`s back at it. We`re back.

(COMMERCIAL BREAK)

SCHULTZ: And we got a lot of response on twitter and facebook about
the plan by the workers of Wal-Mart to strike at a thousand stores on black
Friday. About - let`s see.

We had Mary Ann Shadel (ph) say, I wish them the best. Hope it opens
up some eyes and shut some mouths.

Kevin Thompson comments, I always buy everything at Wal-Mart on black
Friday, not this year.

And Bennie take off Robinson writes, don`t give up. The Waltons can
afford it.

Keep sharing with us your thoughts on facebook and twitter. We`re
coming right back.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to "the Ed Show." With the election barely
over, governor Scott Walker of Wisconsin was making it clear he will take
another crack at voter suppression. Here he is at the Reagan library
throwing out a little red meat.

(BEGIN VIDEO CLIP)

WALKER: I think states across the country that have same day
registration have real problems because the vast majority states of poll
workers who are wonderful volunteers who work 13-hour days, most cases are
retirees, they just it`s difficult for them to handle the volume of folks
who come at the last minute. It would be much better if registration was
done in advance of Election Day. It would be easier for our clerks to
handle that all that need to be done.

(END VIDEO CLIP)

SCHULTZ: Walker says it`s about voter integrity, but it`s really
about turnout. Walker wants to change the system because high voter
turnout often favors Democrats. The turnout in Milwaukee was 87 percent on
Election Day.

Wisconsin same day registration law goes back to 1976. And it`s a
proud tradition of the state. It helps college students, minorities and
poor people participate in democracy. Walker hasn`t given up on another
form of voter suppression, his voter I.D. law.

(BEGIN VIDEO CLIP)

WALKER: I signed into law last year voter I.D. as you might guess,
it`s stuck in the courts as is often the case. But we will prevail. We
didn`t have it before the November election, but we will have it in the
future.

(END VIDEO CLIP)

SCHULTZ: Really? Governor Walker your law was struck down by a court
for a good reason. If you and your fellow Republicans insist on round two,
I`ll speak for Senator Fred Risser tonight, it will be met with opposition
and justice because that`s what Wisconsin is all about.

Tonight in our survey, I asked you, who will Americans punish for
failing to reach a deal if that`s the way it goes down? Four percent of
you say Democrats, 96 percent say Republicans.

Coming up, actor Henry Winkler like you have never seen him before,
only on "the Ed Show." stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: What makes me think I`m so cool?

UNIDENTIFIED MALE: That makes me think I`m so cool.

(END VIDEO CLIP)

SCHULTZ: And in the "Big Finish" tonight, Henry Winkler, Arthur
Fonzirelli, a.k.a the Fonz, is an American icon. Cool guy and a heart of
gold. Something the Fonz and I think Winkler share in common, don`t you
think?.

Since Winkler made it big, he`s appeared on Broadway and countless
movies and he is currently working on three television shows. In addition
to acting, Winkler is the author of 25 children`s books and has been
recognized for his contributions to education literacy programs. Winkler
donned the Fonz`s weather jacket one more time back in 2008 when he joined
forces with Ron Howard to create this call to action.

(BEGIN VIDEO CLIP)

HENRY WINKLER, ACTOR, AUTHOR: You know, I`ll tell you something.
Eight years ago, I thought, OK, we have these president of the United
States Cheney-Bush, just give them a shot. Was -- I was so --

UNIDENTIFIED MALE: You were wrong, Fonz?

WINKLER: OK, that`s the word. But now we can make it right, right?

(END VIDEO CLIP)

SCHULTZ: Joining us tonight at "the Ed Show," actor Henry Winkler
whose USA Network show "Royal Pains" premieres with a two-hour movie event
on Sunday, December 16th. And I tell you what, I have made it into Detroit
lake, Minnesota to have you on the program.

WINKLER: Thank you. I`m so happy to be here, Ed.

SCHULTZ: You know, you have done so much in your career and you have
been so unselfish and been committed to education and writing these books.
That takes a lot of energy and a lot of passion.

WINKLER: Well, I will tell you. First of all, I never knew I could
write a book. And I write with my partner Lynn, but we write comedies. I
had no idea it was going to be so far reaching. And the greatest
compliment is when children say, how did you know me so well? Here I am.
I`m one of you.

SCHULTZ: You`re into politics. You follow it. How important was
this election? How connected were you to the decision?

WINKLER: This election seemed to be very important. I voted for a
man, whether or not he was able to accomplish everything that he talked
about his first term, I truly believe he`s the man who cared about the 300
million people in the borders of America as opposed to a very few friends
in maybe the city he lives in, you know.

SCHULTZ: In that 47 percent comment, did that strike a nerve with
you?

WINKLER: Well, practically, I was very happy he said it because I
believe that it very much helped the cause of our president. On the other
hand, it is very sad that the worst word in the English language is
beholden because these men are beholden to somebody other than the
population that they are supposed to take care of.

SCHULTZ: There`s a statue of you in Milwaukee.

WINKLER: Yes. And of course, taller than I am.

SCHULTZ: Yes.

WINKLER: It`s a problem.

SCHULTZ: That of course, is where happy days was. And so, you know
the culture of the state.

WINKLER: Yes.

SCHULTZ: And you know how important workers rights were in all that
state has gone through. With that, can we rebuild the middle class?

WINKLER: I believe so, but it does not depend on the government. It
does not depend on one man, the president. It depends if we`re really
interested, it depends on us, the population taking the country and saying,
you know what, we want to go in the direction where we are going to take
care of the middle class.

SCHULTZ: The Republicans are climate change deniers.

WINKLER: Right.

SCHULTZ: Young kids aren`t.

WINKLER: Right. I have a Broadway play that just closed and it
closed because of a hurricane. A hurricane, the likes of which, the city
that we`re in at this moment has never known. And I was born and raised
here. Mother Nature is really angry. And the fact is, there is such a
thing as -- that science cannot be denied.

SCHULTZ: And where does that leave the Republican Party then?

WINKLER: It leaves them in, I believe, the Republicans are not all
outrageous. And I believe that they are now going to have to relook at who
they are, what they believe and who they think they are taking care of.

SCHULTZ: Can President Obama have a successful second term?

WINKLER: I think that he has learned a major lesson and I believe
that he can have a very successful second term if he now -- he`s got
nothing to lose.

SCHULTZ: Yes.

WINKLER: Now, he does not have to make nice with anybody.

SCHULTZ: All right. Henry Winkler, great to have you on the program.
Thanks so much. Come back again.

WINKLER: I hope I made sense.

SCHULTZ: You made a lot of sense. Absolutely.

Mr. Winkler`s network show "Royal Pains" premiers with a two-hour
movie event on Sunday December 16th. And thanks for being on the program.

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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