The Ed Show for Tuesday, December 4th, 2012

THE ED SHOW with ED SCHULTZ
December 4, 2012

Guests: Nancy Pelosi, Sherrod Brown, Sen. Debbie Stabenow, Howard Fineman, Ilyse Hogue


ED SCHULTZ, HOST: Good evening, Americans. And welcome to THE ED
SHOW, live from Washington, D.C.

Tonight, breaking news from the nation`s capital: House Democrats are
turning the screws on House Speaker John Boehner.

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

(BEGIN VIDEOTAPE)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Unfortunately, the
speaker`s proposal right now is still out of balance.

SCHULTZ (voice-over): The president responds to John Boehner, but
Democratic leader Nancy Pelosi has a plan to get around the speaker.
Tonight, Leader Pelosi joins me for an exclusive interview.

Senator John Kerry like you have never seen him before. The statesman
from Massachusetts scolds the radical right after Senate Republicans block
a U.N. treaty on rights for the disabled because they are concerned about
home schooling? You don`t want to miss this tape.

Plus, my interview with Ohio Senator Sherrod Brown on what looks like
a massive win for progressives and Elizabeth Warren.

Then, Senator Debbie Stabenow of Michigan on the latest in the fight
to end Republican obstruction. And the people creating petitions on the
White House Web site are getting more and more creative. We`ll tell you
what the new petition to build a death star.

(END VIDEOTAPE)

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

Democrats are determined to extend the middle class tax cuts before
the end of the year. That is the bottom line. Party leaders and members -
- they`re all on the same page. President Obama rejected the latest
proposal from House Speaker John Boehner. The president and the Democrats
are focused on revenue and they are determined to make sure that the top
tax rates go up.

(BEGIN VIDEO CLIP)

BOEHNER: Unfortunately, the speaker`s proposal right now is still out
of balance. You know, he talks, for example, about $800 billion worth of
revenues, but he says he`s going to do that by lowering rates. When you
look at the math, it doesn`t work.

(END VIDEO CLIP)

SCHULTZ: Senate Majority Leader Harry Reid wasted no time explaining
why the Boehner proposal is not serious.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: Arithmetic. You can`t get
from here to there unless you raise the rates. You can`t do it. That`s
why Romney couldn`t explain it during the presidential election.

No one can explain it because you can`t do it. It`s arithmetic.

(END VIDEO CLIP)

SCHULTZ: White House Press Secretary Jay Carney says the speaker`s
plans raises more questions than answers.

(BEGIN VIDEO CLIP)

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: We don`t know who pays. We
don`t know what we`re talking about in terms of actual legislation to
increase revenues. It`s magic beans and ferry dust.

(END VIDEO CLIP)

SCHULTZ: New developments in the Congress today illustrate John
Boehner`s heavy-handed approach to leadership, Boehner and the Republican
steering committee kicked four Republican congressmen out of their
committee seats for voting against party leadership in the past.

But Boehner finds himself in an increasingly weak position. Senate
Minority Leader Mitch McConnell refused to take a position on Boehner`s
debt plan today.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: I have no particular
observation other than I commend the House leadership for trying to move
the process along and getting to a point where hopefully we can have a real
discussion.

(END VIDEO CLIP)

SCHULTZ: Meanwhile, House Democrats are cranking up the pressure.
Congressman Tim Walz of Minnesota introduced a discharge petition on the
middle class tax cuts in the House. If the petition gets 218 signatures,
it would get a floor vote before the end of the month.

(BEGIN VIDEO CLIP)

REP. TIM WALZ (D), MINNESOTA: This is an issue that we all agree on.
There`s not a single Republican who signs. It`s violating any pledge they
took to raise taxes.

(END VIDEO CLIP)

SCHULTZ: Democratic Leader Nancy Pelosi announced a plan for the
discharge petition last week. The petition keeps the focus on extending
tax cuts for 98 percent of Americans. I spoke to Leader Pelosi late this
afternoon about the strategy and the latest developments in the debt
standoff.

(BEGIN VIDEOTAPE)

SCHULTZ: Leader Nancy Pelosi, thanks for joining us tonight.

REP. NANCY PELOSI (D-CA), MINORITY LEADER: My pleasure.

SCHULTZ: The discharge petition, what are your expectations?

PERINO: Well, my expectations have already been exceeded because we
have over 150 members, House Democrats who have signed it and we`ve only
been -- we were only in session a few hours today. So, tomorrow --

SCHULTZ: Will you get to 18?

PERINO: That would require some Republicans to sign up. What we will
get is the attention of the country on the fact that we can bring this vote
up. We can do it by practically unanimous consent. Everybody agrees in
the country and in the Congress that we should have a middle income tax
cut.

The -- what is holding it up is the Republicans holding it hostage for
tax cuts for the wealthy. But left to it on its own, standalone, we think
it would get a unanimous vote in the Congress.

SCHULTZ: The Boehner proposal on its merit, characterize it for us.

PERINO: Well, I think it`s an assault on the middle class, on our
seniors, investments in the future. We want to come to the table. We know
we have to have growth in order -- if you want to reduce the deficit,
create jobs.

So we know we have to have growth. We know we have to make cuts. We
know we have to have revenue. You cannot get from here to there without
it. And so, if you read closely what they have in their letter, even
though it`s bare bones, you have voucherizing of Medicare, you have a
return to the Ryan budget, which priorities are not priorities that I think
the American people share.

SCHULTZ: Rates, can there be a deal done with the rates not going up?

PERINO: No. I`m an appropriator for a long time in the Congress
since I was (INAUDIBLE). We used to have an expression. It`s not the
price. It`s the money.

This is not to be punitive on the people who make over $250,000. It`s
just to be fair to the entire country. You need that additional revenue in
order to reduce the deficit and continue to make investments in growth.

SCHULTZ: So, if Boehner says that -- if Speaker Boehner says that,
you know, we`re not going to move on the rates, where are we?

PELOSI: Well, I would hope that`s just a bargaining position. But
the fact is that we have talked about it two step. Do a down payment on
cuts, on investments and on revenue this year. And then in the next year,
take the time to go over what we would do with real revenue reform.

You can`t do it in a matter of weeks right now.

SCHULTZ: Through this whole process, you want the rates to go up --
been very clear on that. Medicare age stays the same. That doesn`t
increase. And the benefits don`t change.

How confident are you that you can protect all of that and get what
you want?

PELOSI: Well, I think it`s important for the American people to
understand the terms that we`re using here. Raising the Medicare age
doesn`t really in the overall scheme of things reduce cost. It just makes
more of a problem.

We still have to deal with the issues of between 65 and 67. So to
raise the age sounds OK, that sounds like maybe to some a good idea. I
don`t even think it sounds like a good idea. But it`s not the money raiser
people think that it is.

So we know that if we go into this, as we did in the Affordable Care
Act, we did two things. We slowed the increase of payments to providers in
order to use that money to prolong the life of Medicare. We also built
into the Affordable Care Act rewarding performance and quality and value of
procedures, not quantity of procedures.

So, it`s about quality, not just quantity.

SCHULTZ: How convinced are you that they really want to get the
entitlements and get them going in a different direction? I mean, Boehner
comes out and he offers basically the Ryan plan.

PELOSI: Yes.

SCHULTZ: This is really what they want, isn`t it?

PELOSI: Well, there`s a range as to what they want. There`s some who
have said publicly for a long time now, they think Medicare should wither
on the vine.

The Ryan budget is exactly a furtherance of a withering on the vine
for Medicare. It makes it a voucher. It takes money from the Medicare
system and uses it for high-end tax cuts. I mean, it`s completely opposed
to perpetuating and strengthening Medicare.

So if you`re going to have this discussion, I`d love to have it in
full view because you have, who was it, Voltaire, who said, if you want to
debate with me, define your terms. What do you mean by restructuring
Medicare? Making it a voucher, wither on the vine? Or can we work
together to strengthen it, to prolong its life, to increase its benefits as
we did in the Affordable Care Act?

SCHULTZ: What percentage would you put ongoing over the cliff and not
getting a deal?

PERINO: Well, I`m an optimist. I believe that we can get an
agreement. I really do.

And I think that if our Republican friends think they`re never going
to agree with anything, they might as well let us know, the answer is no.
Let`s all go home and deal with that.

But the fact is that we`re here and I`m hopeful that we can come to
terms for step one, a down payment in terms of cuts and revenue and then
addressing the fuller issue of how we make a fairer and more simple tax
code. Perhaps lowering rates, broadening the base.

SCHULTZ: Do you think any of these negotiations should be connected
to the debt ceiling?

PERINO: No.

SCHULTZ: Is that a line in the sand?

PERINO: Well, I think it makes sense. We have what was called the
McConnell rule, I think it`s now known, where the president puts forth what
he wants and the less of two-thirds of the congress that overturns it, then
that`s how we would go forward.

SCHULTZ: So, let`s say we go over the cliff. You don`t get a deal.
Politically, how do the Democrats look? How do they negotiate from that
point on? Who has the upper hand, in your opinion?

PERINO: Well, again, I`m an optimist and I don`t like a hypothetical
as disastrous as that.

SCHULTZ: Sure. But there have been lawmakers that say we are going
over the cliff.

PERINO: Well, in the anticipation that might be a possibility, a year
ago when we agreed to this Budget Control Act, we put built-in protections
for many of our priorities should we go over the cliff. And I think it`s
important for people to see that there are protections.

We held Medicare harmless to 2 percent of any cuts. We had
initiatives, Pell Grants and the rest that would be protected. So --

SCHULTZ: So this would put the Republicans in a untenable position
politically? Will it really hurt them in your opinion?

PERINO: Well, I think it would hurt them because it`s important --
the important thing is that the Republicans do not want to touch one hair
on the head of one person making over $250,000. That is the rub.

We have said let`s decouple. Let`s give the American people what they
want and we all agree upon. They said work together.

Here`s something we all agreed upon and that they want -- middle
income tax cut. What`s standing in the way? The Republican insistence,
holding hostage for tax cuts for the high end.

So, if we go over the cliff, it`s strictly for that reason.

SCHULTZ: Do you think John Boehner is looking over his shoulder?

PERINO: I don`t know. I don`t know.

I think he`s a decent fellow. I might get in trouble for saying that.
But I don`t -- I really am the last person to talk about what the politics
of the Republican Caucus are.

SCHULTZ: But he`s moved people out of committee positions that didn`t
get in line. What does that signal?

PERINO: That`s so unknown to us in our Democratic Caucus because
we`re used to diversity of opinion, diversity in every possible way. I`m
so proud of our caucus now because we`re going to be a majority -- a
majority will be women and minorities and LBGT community members. That`s a
beautiful thing.

So there`s a lot of diversity -- generational, geographic, ethnic,
gender-wise in every way.

SCHULTZ: But that heavy-handed operation that he has, doesn`t that
signal how tough he`s going to be to negotiate with Democrats o on this?

PERINO: I -- again, it`s a concept unknown to us in our caucus in
terms of: you`re too much to the right, so you go. You`re too much to the
moderate side of things, so you go.

So, I can`t -- I really can`t speak to it.

SCHULTZ: You`re very proud of the diversity in the Democratic Caucus,
very proud of the diversity in leadership. Why is this so significant?

PERINO: Well, it`s significant because our caucus looks like America
and so do our chair people. We have -- half of our chairmen will be women
and minorities. And some of it is historic.

We have our Louise Slaughters, chair of Rules, very powerful position.
Now, we`ll have senior Democrat Maxine Waters on Financial Services. Nita
Lowey, the chairman of what we used to call the powerful Appropriations
Committee, that`s just the beginning of it. Women across the board in
chairmanship.

SCHULTZ: Finally, Congresswoman, there`s been so much made about
Christmas, the holiday, that Congress is notorious for taking it up to the
very last 11th hour and doing something to get out of town. Do you want to
respond to that?

PELOSI: Well, I think that`s an irresponsible position. And again,
we`re waiting for the Republicans to come to the table seriously. Not to
toy with the Christmas holiday, but to let people have confidence to buy
toys.

We -- the consumers are waiting to hear, the markets are waiting for
the confidence to hear that we`re going to be doing something. And even
these three weeks, these two weeks are vital weeks in terms of our economic
growth and what we would like to see happen. People have to know that come
January, they can pay the bills for what they bought in December, and we
want them to have that middle income tax cut that puts $2,200 more in the
pockets of middle income families. It`s 98 percent of the American people.

(END VIDEOTAPE)

SCHULTZ: House Democratic Leader Nancy Pelosi with me earlier today.
You get a sense here on Capitol Hill, it`s all about the rates. If the
Democrats don`t get the rates they want, you can forget the rest of the
conversation. A lot of lawmakers are on the same page on the Democratic
side.

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

Tonight`s question: can both parties reach an agreement on the fiscal
cliff before the end of the year? Text A for yes, text B for no. to
622639.

You can always go to our blog at Ed.MSNBC.com, and leave a comment.
We encourage that. We`ll bring results later on in the show.

Coming up, more of my interview with Nancy Pelosi. Senator Sherrod
Brown of Ohio will weigh in on the Democratic leader`s comments, and the
Republicans` so-called fiscal cliff compromise.

Stay tuned.

(COMMERCIAL BREAK)

SCHULTZ: Elizabeth Warren hasn`t taken her seat in the Senate yet,
but she`s close to locking up a spot on the Senate Banking Committee.
Senator Sherrod Brown of Ohio on what it means for consumers, coming up.

And later, Senator John Kerry takes on Republicans for voting down a
U.N. treaty to protect the rights of the disabled. Howard Fineman and
Ilyse Hogue on what Senator Kerry calls one of the saddest days in the
Senate.

Share your thoughts with us on Facebook and on Twitter using #EdShow.
We`re coming right back.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW.

Republicans say that it will hurt business if we raise revenues. But
CEOs and business leaders are telling Leader Nancy Pelosi a different
story.

More now on my interview with the Democratic leader in the House.

(BEGIN VIDEOTAPE)

SCHULTZ: We put a graph on TV last night. Corporate profits through
the roof, wages down over the last 10 years. There`s a real separation
there.

What are the CEOs saying when they come on Capitol Hill? Can they go
for a rate increase?

PELOSI: Overall, that`s what we`re hearing from them. They
understand that revenue has to be part of it. That doesn`t address the
disparity you talked about --

SCHULTZ: Sure.

PELOIS: -- which is an immorality in the system.

But in terms of what they say when they come here about this, I don`t
even remember one of them saying we cannot touch revenues.

I don`t know why they haven`t convinced our Republican colleagues that
everybody recognizes if you want growth, you need to have investments. But
you want cuts, so you have to establish your priorities carefully, and you
must have revenue to make that happen.

The tax cuts for the high end are one of the biggest factors
increasing the deficit. Just think of it this way: tax cuts for the
wealthy, give the tax cuts to the wealthy and send the bill to your
children, because it`s only going to increase the deficit. It`s not going
to create jobs. It`s not going to inject demand into the economy that will
create jobs. So, this is a bad deal all around.

What we need is to make a judgment about what we do. Does it reduce
the deficit?

SCHULTZ: OK.

(END VIDEOTAPE)

SCHULTZ: Joining me now is Ohio Senator Sherrod Brown.

Senator, good to have you with us tonight.

SEN. SHERROD BROWN (D), OHIO: Good to be back.

SCHULTZ: Your comments on what Nancy Pelosi has to say about revenue.

BROWN: Well, she`s right. I mean, you look at -- you look at a
little history in the 1990s when, you know, the upper 1 percent or 2
percent or 5 percent were paying a little bit more in taxes. Just a little
bit more. We had 21 million private sector job creation, net job creation,
private sector.

When George Bush cut taxes on the wealthy in 2001 and 2003, we`ve had
no real job growth and no wage growth during this past decade.

We`re finally now after 10 straight years of manufacturing job
decline, hitting places like Toledo and Cleveland and Cincinnati
particularly hard, and Dayton, we`re seeing now in the last two years after
the auto rescue, after we`re doing some of the right things here, we`re
seeing manufacturing job growth.

So, history -- I agree with what Leader Pelosi says. History proves
what she said. It`s been right in the last 20 years.

SCHULTZ: So based on history, this is about arithmetic and not
ideology, because the sense I get on the Hill talking to lawmakers today,
if you don`t get the rate increase, if the Democrats don`t get the rate
increase, you can forget everything else.

BROWN: Yes, I think that`s right. And we have seen in this country a
decline in infrastructure in the last 30 years. That means everything from
investment in community colleges, health care, highways and bridges, public
transit -- all of that, and we need these revenues, particularly from upper
income people.

If the president would back down here or if we would lose this fight,
it would say, we`re never going to increase taxes on the wealthy. This is
the time to do it.

SCHULTZ: Well, if it`s about the rates, that means John Boehner`s
proposal is DOA.

BROWN: Well, his proposal is DOA for a couple reasons. One, the math
doesn`t add up.

SCHULTZ: He says he won`t raise rates. He`s getting heat on the Hill
today from people in his caucus about why did you put too much on the
table?

So, I mean -- this Tea Party wing of the Republican Party over there
in his caucus is telling him we`ll give him the rates. Where does that
leave us?

BROWN: Well, it leaves us that John Boehner is going to have to
compromise. It might mean he needs 180 Democratic votes and 50 Republican
votes.

But the fact is there was an election. After 2010, Boehner could
claim that the public spoke. Well, in 2012, millions and millions and
millions more people voted. In my state, more than a million more voters
in Ohio alone voted in significant numbers for President Obama, increased
numbers of Senate and House Democrats.

All of us said we need to raise the rates for upper income people
asking them to pay a little more. Just what they paid a decade ago when
the economy took off and we had a surplus instead of these tax cuts for the
rich. They left us with fewer jobs and lower wages and budget deficits.

SCHULTZ: Can you keep the moment up in the public arena? Fifty-three
percent of Americans say Republicans will get the blame if we go off the
cliff. And are you confident Democrats are going to be able to win it this
fight? Only 27 percent would blame the president.

This is a healthy position to be in. But how confident -- how
confident are you that that number will hold?

BROWN: I think that number gets better because I think the public is
more and more as the deadline gets near, as the, quote-unquote, fiscal
cliff approaches and becomes eminent, the public pays more attention. And
the facts are really clear on this.

The election said that we raise rates on the wealthiest people. Just
ask them to pay a little bit more. The election said that basically, they
didn`t believe the Republicans -- if they could produce more revenues --

SCHULTZ: Yes.

BROWN: -- taking it from the wealthy. Rather, the public believes
Republicans want to stick it to the middle class. The show says that every
day. But public understands it. They are understanding more clearly as we
get closer to the fiscal cliff.

SCHULTZ: I mean, it says a signal to people that last summer, you
know, the Senate passed tax cuts for 98 percent of Americans but then they
won`t do it in the house. That was before the election.

And I just -- holding the ground is going to be important, no question
about that. I get a sense the Democrats are unified.

But going over the cliff, that affects the constituents of the
Democrats big time. Correct?

BROWN: Yes.

SCHULTZ: And so, how do you hold that together?

BROWN: Well, you hold it together, Senator Stabenow talked to the
caucus today, there`s unanimity that pointing out in July, I believe July
25th, we passed tax cuts for the 98 percent, as you said, to continue this
tax policy that they get about $2,000 an average tax cut. Meaning if it
expires, their taxes go up $2,000.

The Republicans know that. Republicans know if we don`t do it by --
if they don`t do it by January 1st, simply pass that bill, send it to the
president, we`re going to keep passing tax cuts for the middle class. If
they keep saying no, eventually they won`t because the public pressure will
be on them they need to step up for the middle class.

SCHULTZ: All right.

BROWN: They`ve got to quit protecting. They do everything in the
name of the wealthy. And that doesn`t work for our country.

SCHULTZ: OK. Sherrod Brown, stay with us.

BROWN: Thanks, Ed. Thank you.

SCHULTZ: We`ll work overtime tonight. I appreciate it.

It looks like Senator-elect Elizabeth Warren, a champion of financial
reform, will get a spot on the Banking Committee.

And Senator John McCain hints he might favor filibuster reform.
Michigan Senator Debbie Stabenow is here on Senate rule changes and a whole
lot more.

Stay with us. We`re right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN.-ELECT ELIZABETH WARREN (D), MASSACHUSETTS: To all the small
business owners who are tired of the system rigged against them, we`re
going to hold the big guys accountable.

(APPLAUSE)

(END VIDEO CLIP)

SCHULTZ: Welcome back to THE ED SHOW. That`s Senator elect Elizabeth
Warren of Massachusetts, who has been a true champion of holding the big
guys accountable. Those big guys might be in for a rude awakening.
Sources tell NBC News Warren will likely become a member of the Senate
Banking Committee.

Nothing is final until it`s confirmed by caucus. And as a member of
the Senate Banking Committee, Warren will have influence over proposed
regulations of Wall Street and the banking industry. It would be a perfect
development for progressives in the country. Elizabeth Warren practically
created the Consumer Financial Protection Bureau as part of Dodd/Frank
financial reform.

Warren would be and has been a great choice to head the agency. But
Republicans threatened to block it. Lobbyists reportedly fought Warren
being chosen for the Banking Committee. If she gets the spot, she will be
one of the senators making sure financial reform has real teeth.

I`m joined again tonight by Senator Sherrod Brown of Ohio, who is also
a member of the Senate Banking Committee. I tell you what, there`s so much
Twitter world and so much blogosphere talk about her coming on to this
committee. What would it mean? I mean, a real ally of yours. How much of
a vital voice would this be?

SEN. SHERROD BROWN (D), OHIO: It would matter in the ways you say. I
-- this is a committee that historically was, frankly, too close to the
Banking Committee. I think with what Tim Johnson has done, who is the
chair of this committee now, this has become a committee more focused on
housing and more focused on consumer issues. We saw that in some of the
provisions in Dodd-Frank.

I don`t know if Senator elect Warren, once she`s a senator, will be on
the Banking Committee. I`m hopeful she will. I hear those rumors too.
It`s not confirmed. But what it will mean is that she will stand up and
join Senator Merkley, Senator Jack Reid, several of us on this committee
that have always had a pro-consumer attitude. It will help us.

I`ve worked on legislation. I mean, one of the reasons that Wall
Street came in in my campaign against me, I worked on legislation to break
up the six largest trillion-dollar banks because they are too big to manage
and too big to regulate, leading to too big to fail. And her joining us on
that committee will matter, because she will speak strongly on these kinds
of issues, to make sure Wall Street reform is carried out the way we meant
it, to make sure the consumer agency is as strong as possible, and to make
sure we can move further legislatively.

SCHULTZ: Is Dodd-Frank and financial reform still in a crucial stage?

BROWN: Absolutely it is, yeah.

MORGAN: Because of how it`s going to be executed.

BROWN: Yes. It`s still not fully implemented. The regulations still
aren`t fully promulgated, if you will, fully enforced and in place. And
there`s more to do. I mean, we lost on my amendment two, three -- or two
and a half years ago to break up the six largest banks, these trillion
dollars -- literally six banks who are sized from 800 billion to 2.3
trillions dollars. They literally combined represent 65 percent of their
assets -- 65 percent of the U.S. GDP.

They are too powerful. We will -- I expect -- I`m not speaking for
Senator Warren, but I expect Elizabeth to join us in continuing those
efforts to make this legislation stronger, make sure the enforcement powers
are where they belong, and make sure regulators can do their jobs.

SCHULTZ: All right, President Obama has tried to reform Wall Street.
He`s taken a lot of heat for it. They have accused him of being anti-
business. Got a lot of positive figures out there in the economy. Does a
second term present a great opportunity for him to follow through on Wall
Street reform? Because there are some in the liberal community that think
he was a disappointment in that regard.

BROWN: First of all, about the economy, my state right after the auto
rescue -- when the auto rescue began to take hold, my state`s unemployment
rate, Ohio, was 10.6 percent. Today, it`s down to 6.9 percent. And that`s
because of a lot of things. Partly Wall Street reform, partly trade
enforcement that you`ve talked about on this show repeatedly, Ed, and
partly the auto rescue, all of those things together.

I think the president knows that we need to continue to make sure the
regulations are strong. Part of that is done by his administration and
part of it is by Congress. But we know he will work with Senator Merkley,
who has been very involved in this, Senator Jack Reid, Senator Menendez,
Senator Schumer, people who have been involved on the consumer side of
these issues. And I`m optimistic we move forward on this.

SCHULTZ: All right, Senator Sherrod Brown, thanks for joining us
tonight here on THE ED SHOW. Thanks so much.

Coming up, Senator Mitch McConnell rails against filibuster reform,
but his buddy John McCain doesn`t really agree. Michigan Senator Debbie
Stabenow on filibuster reform and so much more, next.

Later, Senator John Kerry delivers an emotional response to
Republicans during a debate today.

And the White House`s petition site makes civic engagement easy, maybe
too easy. I`ll show you one of the more creative petitions out there.
Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW. Thanks for watching tonight.
Senate Republicans are holding America`s progress hostage with the
filibuster. They have blocked legislation like the Veterans Jobs Act,
which is killing thousands of jobs in the process.

Now Senate Democrats want action. They want change. Senate Majority
Leader Harry Reid wants three changes to the filibuster. They would make
filibuster debates public and provide a shorter timeframe for breaking
filibusters. These are minor reforms and the filibuster can still be used.

Republican Minority Leader Mitch McConnell railed against the changed
earlier today. He said that they were an effort to marginalize the
minority party. Harry Reid hit right back at the gentleman from Kentucky
and referenced this comment Senator John McCain made on Monday.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: Mr. Chairman, I again apologized for
what seems to have happened. And much to my dismay, it lends some credence
to the argument that maybe we ought not to do business the way that we are
doing here in the United States Senate.

(END VIDEO CLIP)

SCHULTZ: Senator John McCain was blaming Senator Rand Paul of
Kentucky for holding up amendments on the Defense Authorization Bill. In
the process, McCain gave credence to filibuster reform. His comments step
all over Mitch McConnell`s bogus claim. Filibuster reform is not an effort
to marginalize the minority party.

I mean, with 386 filibusters from Republicans, these rule changes are
simply a way to make the Senate work again. That`s what you pay them for.

Let`s turn now to Senator Debbie Stabenow of Michigan. Senator, great
to have you with us tonight. There`s been a lot of conversation in the
liberal community in this country about this. And Democrats seem to be
champing at the bit. Is this going to happen? Are we going to see change?

SEN. DEBBIE STABENOW (D), MICHIGAN: Yes, I believe that we are going
to see change. We have the support to make the changes. And I think it`s
very clear the public wants us to get something done. Of course, we`re
going to work across the aisle. But one person, like Senator Rand,
shouldn`t be able to hold up the Department of Defense Bill or, in the case
of my Bringing Jobs Home Act, as you know, which is so important to stop
the incentives for shipping jobs overseas, we had 57 votes, but we couldn`t
get 60 to stop a filibuster. And they didn`t have to stand on the floor
and talk. So nobody knew who it was that was blocking us to closing those
loopholes to bring jobs home.

So this is common sense.

SCHULTZ: So senator, what is your response to Mitch McConnell when he
says the filibuster reform is an effort to marginalize the minority party?

STABENOW: That`s really crazy. He`s trying to marginalize and has
been marginalizing the majority party. I mean, the last six years, as you
said, there were 386 filibusters. In the six years that Lyndon Johnson was
the majority leader at that time, there was one. One. Because it was only
used in the most extraordinary of circumstances.

Now they do it on everything. Everything, even a Department of
Defense bill that ended up passing today 98 to zero. They still slow
walked it every step of the way, objected.

SCHULTZ: So does John McCain help you? I mean, does his comments
give credence to the reform that you`re having on this debate?

STABENOW: Well, certainly it does help us. I think Senator Rand`s
behavior and other`s behavior does help us. I would love to see Senator
McCain join us. I think it`s questionable whether he will at this point.
But the reality is the public wants us to get something done, to work
together. We know that a minority view needs to be protected in the
Senate. That`s what the U.S. Senate is all about.

But you shouldn`t be able to just block things for the sake of
blocking progress in solving problems.

SCHULTZ: Well, it was very clear. Mitch McConnell said he wanted to
make Barack Obama a one-term president. They wanted to fully stop the
legislative agenda. Do you get a sense that they are going to do that
again? Let`s say ewe didn`t make these changes. Do you think that it
would it be the -- just a repeat of the last session of Congress?

STABENOW: I absolutely do. Even though there are members that want
to work across the aisle, we`re actually, Ed, having better conversations
now. And I appreciate that. Colleagues on both sides of the aisle. But I
think, in the end, with the same leader and the same mind set, it would be
the same thing. And the public deserves better.

SCHULTZ: Quickly, senator, I understand you`re having a press
conference tomorrow with Senator Schumer on middle class tax cuts. From
what I can gather up on the Hill today, it`s all about the rates.

STABENOW: You know what, Ed. We`re doing a countdown to the floor
today. We`ve got 27 days before middle-class families see an increase in
their taxes of 2,200 dollars. I had one constituent share with me, that`s
four months worth of groceries for her family. It makes no sense.

We passed our bill protecting middle class tax cuts, the first 250,000
dollars of income for everyone. We passed it back in July. And the Senate
-- the Senate passed it. The House just needs to pass and make sure that
middle class families don`t bear the burden.

SCHULTZ: All right, Senator Debbie Stabenow of Michigan here on THE
ED SHOW, thanks for your time tonight.

Next up, that`s no Moon. That`s a space station. The White House
petition site gets an interesting call for action. Stay tuned.

(COMMERCIAL BREAK)

SCHULTZ: And we love hearing from our viewers on Twitter and our
Facebook page. Many of you are responding to an article on our blog about
college students who have barricaded themselves to protest Cooper Union`s
plan to charge tuition for the first time.

On Facebook, Donna Marie Martin says, "it`s free in other countries.
If the student qualifies, no reason why there should not be the same
opportunity here."

Peggy Duncan said she would much rather pay for tuition than wars.
"Wouldn`t mind paying taxes if that happened."

And Marjorie Williams believes "the more educated people we have, the
better the country." Keep sharing your thoughts with us on Facebook and on
Twitter using the hash tag #EdShow.

Still to come, Republicans vote down a U.N. treaty to protect the
disabled despite support for high profile Republicans like Bob Dole. Find
out why in tonight`s Big Finish. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: We are back. The White House`s We the People website was
created to provide an online platform for citizens to petition the Obama
administration to take action on issues that they find very important to
themselves. Well, the site makes civic engagement easy and has sparked
some interesting causes.

And its policy of issuing an official response if a petition gathers
25,000 signatures within 30 days has caught the attention of the Internet
trolls. It was the forum used by over 100,000 Texans to express their
desire to secede from the United States after President Obama was elected,
which resulted in another petition in favor of deporting everyone that
signed the petition to withdraw their state from the United States. So
anything can happen.

You can probably see where this is all going. But there`s one
petition on the site that we here at THE ED SHOW can certainly get behind.
It`s a substantial stimulus project that would create millions of jobs,
boost America`s steel industry -- got to love that -- expand our space
program, and basically guarantee our national security.

What could be better? That`s right. Someone has petitioned the
administration to build a Death Star, the fictional Moon-size space base
capable of destroying entire planets from "Star Wars." Just under 2,000
people have signed the petition asking for President Obama to secure the
resources and funding to begin construction of a Death Star by 2016, which
means that it still needs about 23,000 signatures before the Obama
administration is actually expected to issue a response.

We want a response. But I`m guessing with the way the fiscal cliff
negotiations are going, the estimated 852 quadrillion dollars of funding
needed for one steel alone just isn`t in the cards. Dog gone it. I`m
going to sign up tonight.

Tonight in our survey, I asked you can both parties reach an agreement
on the fiscal cliff before the end of the year? Fourth percent of you say
yes; 60 percent of you say no.

Coming up, this could be one of the dumbest votes the Republicans have
ever cast in the history of the Senate. We`ll talk about the Tea Party`s
big win and the emotional reaction from moderates. That`s next. Stay with
us.

(COMMERCIAL BREAK)

SCHULTZ: In the big finish tonight, this is a jaw-dropping example of
just how powerful and backwards the Tea Party Republicans can absolutely
be. Earlier today, the senators had to decide whether to ratify a treat to
protect people with disabilities around the world. Tea Party Republicans
rolled out their United Nation conspiracy theories abound. Senator Kerry
delivered a withering response.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D), MASSACHUSETTS: If the facts are against you,
then argue the law. If the law is against you, then argue the facts. And
if both are against you, just make it up.

Well, that`s exactly what`s happening. Because to join it is to keep
faith with the men and women who have suffered grievous disability in
defense of our nation. And we owe them nothing less.

This treaty is not about changing America. It`s about America
changing the world. This vote is to test whether the Senate will stand up
for those who cannot see or hear and whether senators can hear the truth
and see the facts.

(END VIDEO CLIP)

SCHULTZ: These are the facts: the treaty ensures equal opportunity
for disabled adults and kids around the world. It`s supported by every
major veterans and disability group in America; 152 countries have already
ratified the treaty, including China and Russia. Best of all, the treaty
is modeled after existing U.S. law.

Former Senator Bob Dole is 89 years old. He just got out of the
hospital yesterday. And today he came to the Senate floor in a wheelchair
to support the U.N. treaty. Eight Republicans and two independents voted
for the treaty including John McCain. But it wasn`t enough. The treaty
failed 61 to 38.

(BEGIN VIDEO CLIP)

BROWN: It was solid then. He says it again. He means it. And I
think the organizing around it is so very important. The labor movement,
consumer groups, women`s groups, advocates.

(END VIDEO CLIP)

SCHULTZ: I`m joined by Ilyse Hogue, columnist for "the Nation
Magazine" and Howard Fineman, NBC political analyst and editorial director
of the Huffington Post Media Group. Great to have both of you with us
tonight.

Howard, you first. When bob dole comes to the well of the Senate and
he can`t move people on something so common sense, where are we? Where is
the Tea Party?

HOWARD FINEMAN, "THE HUFFINGTON POST": Well, the Senate is lost.
That`s the way I would put it. Bob Dole, one of the most revered figures,
who was almost literally on his death bed a week or two ago, who summoned
the courage to come to the Senate to be the conscious of the Senate on
something that he initially championed in 1990.

Don`t forget, this was Senator Bob Dole, a Republican. President
George H. W. Bush, a Republican, Attorney General Dick Thornburgh, a
Republican. This was a Republican-sponsored idea that won huge bipartisan
support, that was a model, as you said, for the rest of the world. And now
Mike Lee and 37 other conservative Republicans have seen ghosts really,
tied up the Senate and dishonored, I think, Senator Dole`s tradition and
John McCain`s as well.

SCHULTZ: Elise, what does this say about the Republican party and
their lack of concern for veterans, which, of course, they always tell
everybody they are so concerned about?

ILYSE HOGUE, "THE NATION": Ed, I really think what it says is that
they are more deeply committed to their strategy of fomenting paranoia
about the role of government than they are just supporting our men and
women in uniform. And what they have done today is laid their cards on the
table, that they will use each and every opportunity to keep their base
paranoid, angry and rabid, in an effort to undermine our functioning
democracy.

I believe that there are actually smart, committed Republicans there
wanting to dedicate themselves to service of our country. But they have
got to get this wing of their party in line. They are extremists. And
they are dangerous to our democracy.

SCHULTZ: Howard, do you think that there`s some sole searching going
on because of this tonight within the Republican? What have we become? Do
you think there`s any of that going on?

FINEMAN: I don`t think among those 38 who voted no. I don`t think so
at all. I think with John McCain, who after all was the party standard
bearer in 2008, and who has a mixed history with the conservative wing, and
even John Boehner. And I would bet you somewhere in the recesses of his
heart and mind, Mitch McConnell.

Mitch McConnell is up in 2014 in Kentucky. He never wins going away
in Kentucky. That`s an issue there. There will be lots of others like
them. So of course, there are some Republicans that are thinking that way,
but not these 38. They really do see it as the hand of the United States
in world government reaching down into local towns in Utah and telling them
how to deal with their disabled kids.

SCHULTZ: How do they repair this?

HOGUE: I don`t know that they do. I mean, McConnell is now facing
the Boehner problem, right? He`s having his leadership undercut by a wing
of his party. And more than that, they actually understand that what`s
being threatened is their ability to govern. They have priorities that
they have to get through.

So he`s got to actually exert a firmer hand. We`re starting to see
that with Boehner. But Howard is right. McConnell has an election at
stake.

FINEMAN: By the way, he hired Rand Paul`s campaign manager from
Kentucky to be his campaign manager in this upcoming race.

SCHULTZ: I look at the democrats of this, the veterans of the Senate,
the old guard, the statesman. There was still respect available. That is
-- it just seems lost today.

FINEMAN: Ed, I think you make a very important point. And it`s true
of much of the Baby Boom generation and younger. Very few of them have had
military service. Very few of them have the bonding national, federal, if
you will, experience of being in the Army, of being -- fighting for or
working for a cause larger than themselves, under the banner of the federal
government.

These senators, by and large, don`t have that view. There will be
another generation coming along, Iraq and Afghan War veterans. It will be
interesting to see how they perform.

SCHULTZ: OK. Ilyse Hogue and Howard Fineman, great to have both of
you with us tonight. Thanks so much. 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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