updated 1/7/2013 10:38:36 AM ET 2013-01-07T15:38:36

THE ED SHOW with ED SCHULTZ
January 4, 2013

Guests: Bernie Sanders, Tim Ryan, Lizz Winstead; George Takei


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

President Obama needs your help to protect the big three. I`ll show
you how tonight.

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

(BEGIN VIDEOTAPE)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I suspect that on
Social Security, we`ve got a somewhat similar position.

SCHULTZ (voice-over): New reporting on the fiscal cliff negotiations
is alarming defenders of Social Security everywhere. Senator Bernie
Sanders responds here tonight.

NEWT GINGRICH (R), FORMER HOUSE SPEAKER: Everybody is now talking
about, OK, now comes the debt ceiling. I think that`s frankly a dead
loser.

SCHULTZ: Newt Gingrich warns Republicans to quit hostage taking. But
another big-time senator refuses the advice.

Congressman Tim Ryan, Gene Robinson and Howard Fineman on the
Republican deception on the debt.

Sixty-seven House Republicans vote against disaster relief for New
York and New Jersey residents. We`ll detail the shame of Paul Ryan and the
Sandy 67.

Plus, Barney Frank wants back into Congress.

And Bill O`Reilly does his best Archie Bunker.

BILL O`REILLY, FOX NEWS: Asian people are not liberal, you know, by
nature. They`re usually more industrious and hardworking.

SCHULTZ: Tonight, actor George Takei joins me to set O`Reilly
straight.

(END VIDEOTAPE)

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

We told you how Republicans are outright lying about the way the debt
ceiling works. Today, we saw the next phase of their misinformation
campaign.

Tea Party Senator Ron Johnson of Wisconsin went on MSNBC this morning
and hammered the president when it comes to spending cuts.

(BEGIN VIDEO CLIP)

SEN. RON JOHNSON (R), WISCONSIN: President Obama and the Democrats
have no intention. As a result, they have no plan to reduce the deficit,
to reduce government`s control in our lives.

This isn`t going to go away. We`re not going to solve this thing,
unfortunately, because President Obama has no intention of solving it. He
hasn`t given us a plan. This is going to go on time and time and time
again.

(END VIDEO CLIP)

SCHULTZ: All right. Let`s be clear what Republicans are talking
about when they say spending cuts. They want major cuts to the big three -
- Medicare, Medicaid and Social Security. If overall spending was the
issue, there wouldn`t be a problem. President Obama already signed the
2011 Budget Control Act, which included $1.7 trillion in government
spending cuts.

In reality, the best plan to reduce the deficit comes from new tax
revenue, not spending.

Kevin Drum of "Mother Jones" points out federal spending will be lower
in a decade than when Ronald Reagan took office. The president who
increased spending to its highest level in the past 30 years was George W.
Bush.

Compare spending to tax revenue -- taxes are at their lowest levels in
a half century. Additional tax reforms would easily help cut the deficit
even further. Republicans need to keep talking about spending in order to
get concessions of the big three.

Here is the troubling part in this whole conversation. When it comes
to Social Security, they may have a willing partner. His name: President
Barack Obama -- who has repeatedly made offers to Republicans on cuts to
Social Security.

In the recent fiscal cliff negotiations, President Obama gave House
Speaker John Boehner a third proposal, increasing the tax rate threshold to
$400,000 and adding chained CPI, which is a benefit reduction in Social
Security. That`s the only way you can look at it. Republicans did not
take the plan.

When Harry Reid was negotiating with Senate Republican leader Mitch
McConnell, the president allegedly asked Reid to put Social Security
reforms back on the table. According to multiple accounts, Senator Reid
was so unhappy with the proposal, he threw it into a burning fireplace in
his office.

So, the White House says a formal offer on Social Security was never
made. But President Obama`s position on Social Security reform really
isn`t hard to find. In his 2006 book, "The Audacity of Hope," then-Senator
Obama wrote, "The problems with the Social Security trust fund are real but
manageable. In 1983, when facing a similar problem, Ronald Reagan and
House Speaker Tip O`Neill got together and shaped a bipartisan plan that
stabilized the system for the next 60 years. There is no reason we can`t
do the same today."

This is true. Ronald Reagan and Tip O`Neill cut a deal to ensure
Social Security`s solvency in the out years. It`s not clear why we need to
do the same thing today, nor this round of negotiations.

Right now, full benefits in Social Security are guaranteed until 2038.
If there are no changes, 81 percent of all benefits would still be paid
after that.

One way to close the gap is to increase the payroll tax by 1.6
percent.

Another way is to lift the $110,000 cap on payroll taxes. Reform is
possible without drastic cuts to benefits. And that`s where the argument
is right now, benefit cuts now.

That`s what the Republicans want because, remember, they want the new
deal. They want to get rid of all government entitlement programs. This
would be a big opportunity for them to start down that road. Most
Democrats are quick to point out Social Security has nothing to do with our
deficit.

(BEGIN VIDEO CLIP)

SEN. DICK DURBIN (D), ILLINOIS: Social Security does not add one
penny to our debt, not a debt. It`s a separate funded operation. And we
can do things that I believe we should now, smaller things, play it out
over the long-term that gives it solvency.

(END VIDEO CLIP)

SCHULTZ: Despite the truth, President Obama has never been shy about
reforming Social Security.

(BEGIN VIDEO CLIP)

OBAMA: We`re going to have to take on entitlements. And I think we
got to do it quickly. We`re going to have a lot of work to do, so I can`t
guarantee that we`re going to do it in the next two years. But I would
like to do it in my first term as president.

(END VIDEO CLIP)

SCHULTZ: The president aligned himself with Mitt Romney, who wanted
to raise the Social Security eligibility age.

(BEGIN VIDEO CLIP)

OBAMA: I suspect that on Social Security, we`ve got a somewhat
similar position. Social Security is structurally sound. It`s going to
have to be tweaked the way it was by Ronald Reagan and speaker --
Democratic Speaker Tip O`Neill.

(END VIDEO CLIP)

SCHULTZ: No one can say the president has not been straight with us
about his intentions to reform Social Security. But this is not a
president who ignores the voice of the American people either. Democrats
and progressives who want to maintain the big three need to speak up and be
active.

Republicans are baiting President Obama into a negotiation on
entitlement reform. Before he gives them what they want, he should listen
to another Republican.

(BEGIN VIDEO CLIP)

RONALD REAGAN, FORMER U.S. PRESIDENT: Social Security has nothing to
do with the deficit. Social Security is totally funded by the payroll tax
levied on employer and employee. If you reduce the outgo of Social
Security, that money would not go into the general fund to reduce the
deficit. It would go into the Social Security Trust Fund.

So, Social Security has nothing to do with balancing a budget or
erasing or lowering the deficit.

(END VIDEO CLIP)

SCHULTZ: Social Security is not the problem. Let`s make sure it
stays off the table in these talks.

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

Tonight`s question: will Republican lies about Social Security work on
the American - people? 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`ll bring
you results later on in the program.

Now, joining me tonight is a senator who has been on the front lines
when it comes to protecting the big three, Senator Bernie Sanders of
Vermont.

Senator, great to have you with us on this Friday evening. Thank you.

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

SCHULTZ: How can we keep Social Security from being offered up in
these financial negotiations when you have a president who is on record
saying that he is open to change? How do you interpret that? How do you
keep him out of the mix?

SANDERS: Well, we`ve got to make the president and Republicans and
any Democrats that want to cut Social Security an offer they can`t refuse,
and that is tens of millions of people have got to make it very clear to
Congress -- Social Security has nothing to do with the deficit. What
deficit reduction needs right now is to ask the largest corporations in
this country who are profitable to a record-breaking degree, one quarter of
whom pay no taxes at all. Their effective corporate tax rate is the lowest
in many, many years.

So, what we have got to say is, no, Mr. President, you`re not going to
cut Social Security. You`re not going to cut Medicaid. You`re not going
to cut Medicare.

By the way, Ed, as chairman of the Veterans Committee, let me also
point out that the so-called chained CPI will make devastating cuts for
disabled veterans, for widows who lost their husbands in Iraq and
Afghanistan.

No, that is not the way we are going to do deficit reduction.

SCHULTZ: Are you confident that the president will protect Social
Security?

SANDERS: No, I am not confident that the president will protect
Social Security. What I am confident in is that every senior organization
in this country, including the AARP, the National Committee to Defend
Social Security and Medicare, they`re going to be there fighting with us to
protect Social Security.

The American Legion, the Disabled American Veterans, all the veterans
organizations are going to be there.

The AFL-CIO and all the unions will be there.

And I think the vast majority of the American people are going to be
there.

What we are talking about, Ed, and you made this point, we`re not
talking about financial issues. We`re talking about ideology. What the
Republicans want to do is destroy the social safety net that has existed in
this country since the 1930s. They just -- they want to give more tax
breaks to people who don`t need it and decimate the programs that working
families and the middle class desperately depend upon. This is a fight for
the soul of America. It is a fight for the soul of the Democratic Party.

SCHULTZ: The conservative editorial page of "The Wall Street Journal"
thinks the debt ceiling threat is a bluff. They wrote today, "You can`t
take a hostage you aren`t prepared to shoot."

Do you think Republicans are willing to shoot the hostage in this
negotiation?

SANDERS: Well, what I think is that the employers of many of our
Republican colleagues, Wall Street, and the big money interests know
absolutely that if the United States, for the first time in its history
defaults, does not pay its debt, it could lead to an international
financial crisis, which will be bad for Wall Street, which will be bad for
big business. And I think they are telling the Republicans not to go down
that path.

SCHULTZ: Speaking of Wall Street, are you willing? I keep hearing
that you`re going to offer up a transaction tax that will generate several
billion to shore up this Social Security fund.

Do you think you would get support on that?

SANDERS: I think we get support from the American people. And I
think more and more folks are looking at that as an option. It would do
two things. It would bring in many hundreds of millions of dollars over a
10-year period. It would put a damper on speculation on Wall Street.

The other thing that we have got to do, Ed, is that right now we are
losing $100 billion a year because of big money interests and wealthy
individuals stashing their money in tax havens like the Cayman Islands --

SCHULTZ: Yes.

SANDERS: -- and Bermuda.

One-fourth of profitable corporations don`t pay a nickel in taxes.
There is a lot that we can do to raise substantial revenue, which will not
only protect the social safety net, it will allow us to invest in America
and start creating the jobs.

SCHULTZ: And that transaction tax, what are you talking about? A
half cent sales tax on every transaction that`s made on Wall Street, or a
quarter cent, or what?

SANDERS: Exactly. It depends. We can do --

SCHULTZ: All right. Sure.

SANDERS: It is a good step forward.

SCHULTZ: All right. Senator Bernie Sanders, great to have with us on
THE ED SHOW tonight. Thanks so much.

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

Coming up, the Republican deception on the debt ceiling continues,
even though Newt Gingrich is telling his party to stop.

But, first, today, "The Associated Press" released the final vote
totals from November`s election. President Obama officially ended up with
51 percent of the vote? That`s right.

Mitt Romney`s total is, you won`t believe it, 47 percent. Not only is
the final Romney percentage ironic, it`s actually hilarious.

But President Obama`s total makes him the first president since Dwight
D. Eisenhower to win 51 percent of the vote twice. Today, in a joint
session of Congress, Joe Biden and President Obama officially won the count
in the Electoral College system.

And as we go to a break, let`s listen to the vice president announce
the big win, accompanied with a little arena rock to Biden things up a bit.

(BEGIN VIDEO CLIP)

JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: Barack Obama of
the state of Illinois has received for president of the United States 332
votes. Mitt Romney of the state of Massachusetts has received 206 votes.
Joseph Biden of the state of Delaware has received for vice president of
the United States 332 votes. Paul Ryan in the state of Wisconsin received
206 votes.

The joint session is dissolved.

(MUSIC)

(END VIDEO CLIP)

(COMMERCIAL BREAK)

SCHULTZ: Misinformation campaign on the debt ceiling continues.
Congressman Tim Ryan on how Democrats are fighting back. And Eugene
Robinson and Howard Fineman join us to say which side of the party has the
upper hand in negotiations. Which side of the table would you want to be
on?

Later, Bill O`Reilly can`t figure out why hardworking Asian-Americans
would vote for liberals? Legendary actor and activist George Takei is here
to respond tonight.

Don`t forget you listen to my radio show on Sirius XM Radio Channel
127, Monday through Friday, noon through 3:00.

Share your thoughts on Facebook and Twitter using #EdShow.

We`re coming right back.

(COMMERCIAL BREAK)

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

The Republican misinformation campaign on the debt ceiling got a big
shot in the arm today, thanks to Senator John Cornyn of Texas. Cornyn
wrote an op-ed discussing the coming deadlines of the sequester, the
continuing resolution to fund the government, and the debt limit.

"It may be necessary to partially shut down the government in order to
secure the long-term fiscal well-being of our country, rather than plod
along the path of Greece, Italy and Spain."

It caught the attention of a lot of folks. Let`s be clear. Not
raising the debt limit is not the same as a partial government shutdown.
It would cause an immediate financial collapse with long-term national and
global consequences.

Senator Cornyn`s office was asked if his government shutdown comments
refer to the continuing resolution to fund the government or the debt
ceiling or both.

A spokeswoman said she didn`t see a distinction between the two in
terms of Republicans using them as leverage. She says, "I wouldn`t look
too much into it." She said, "I think there are three big deadlines." You
think?

Republicans want to use those three big deadlines as leverage, and
Republicans want to blur the distinction between them.

Meanwhile, the king of the government shutdown, former House Speaker
Newt Gingrich, says Republicans should not be flirting with the debt
ceiling.

(BEGIN VIDEO CLIP)

GINGRICH: For example, everybody is now talking about, OK, now comes
the debt ceiling. I think that is, frankly, a dead loser. Because in the
end, you know what is going to happen. The whole national financial system
is going to come into Washington by television and say, oh my God, this
will be a gigantic heart attack. The entire economy of the world will
collapse. You guys can`t be responsible. And they`ll cave.

(END VIDEO CLIP)

SCHULTZ: I am joined tonight by Ohio Congressman Tim Ryan.

Congressman, good to have you with us on this Friday evening.

You know, I think that might have been about the best advice ever come
from the former speaker, calling it a dead loser.

He is calling their bluff here. But why do the Republicans keep going
down this road?

REP. TIM RYAN (D), OHIO: Well, they just -- you know, they got this
thing going on where they just keep talking to each other, and they keep
lurching and further and further to the right. And just think when Newt
Gingrich becomes the voice of reason within the Republican Party, how far
to the right they must have lurched.

And I just think they`re worried, because if they pull up the debt
ceiling as -- and they try to hold the president and the Democrats hostage
over the debt ceiling, the contrast is going to be, well, what are you
going to cut? Are you going to put these deep cuts in the Medicare? Are
you going to put them in Medicaid and nursing homes and these kinds of
things?

So if they bring it up, they`re really playing with fire not only for
the financial side of things, but then, if you`re holding them hostage,
what do you want them to cut?

SCHULTZ: Well, from your perspective on the Democratic side, the
progressive side, there is an opportunity here for the Republicans to
confuse a lot of people. Debt ceiling, government shutdown, you know, a
lot of misinformation out there, who to believe, and, you know, a lot of
average Americans really aren`t schooled up on exactly what all of this
means. That`s why I think that Gingrich may have done the country a favor
right there by cutting right to the chase on what it would really mean.

But what do the Democrats have to do in this campaign?

RYAN: I think do what I heard a clip earlier in the show, what Ronald
Reagan did. You go out as president, you use the bully pulpit, and you
clearly and articulately explain to the American people the differences.
Reagan was talking about Social Security and the deficit.

The president can come out and explain exactly how this is going down,
and the good part about it is the narrative has already been cast. The
Republicans look extremely extreme. They had a great deal the other day
and they even tried to muck that thing up, you know, while they were
dealing with it within the Republican caucus the other day.

So, the narrative is favoring Obama now. So, if he goes out as the
president and explains exactly the difference between a debt ceiling and a
government shutdown, and what is at stake if they hold us hostage, I think
the story is already leaning in his favor, and all he has to do is really
explain to it the American people and he`ll be a winner. And what Gingrich
said will happen.

SCHULTZ: What about the vice president`s role here? The president
has relied on Joe Biden, been pretty successful so far. Should the vice
president be brought in sooner this time around?

RYAN: I think you should have the vice president have the Republican
senators come through, and he should just take pictures with them, and just
continue the charm offensive.

(LAUGHTER)

RYAN: But, clearly, Biden is going to be a huge player in all of
this. He is just so schooled and so sophisticated and knows the nuances of
every single issue that`s coming down the pike. I think the president will
be very wise to put president or Vice President Biden in the middle of
these negotiations.

SCHULTZ: But when it comes to Social Security, as we`ve talked about,
President Obama is on record in his book, in the debates, and in some stump
speeches and interviews about where he stands on being open to change. How
can he go back and negotiate on debt ceiling when the Republicans are
sitting there looking at chipping away at the big three, and not move on
that?

RYAN: Well, I mean, it`s disheartening to hear it. But I think the
president got to keep his eye on the ball here. Social Security is not the
problem for this particular issue that we`re talking about. If he wants to
deal with that on a sidebar issue in another way, and there are other
solutions there that aren`t what the president or the Republicans are
talking about, I think he`s got to -- that`s his job too as president, Ed.

Keep the focus. Keep everybody`s eye on the ball with the current
issue of the day. And he can`t let us get distracted. He can`t let the
American people get distracted by this sidebar discussion about Social
Security.

SCHULTZ: Congressman Tim Ryan, great to have you on THE ED SHOW
tonight. Thanks so much.

RYAN: All right, Ed.

SCHULTZ: You bet.

Republicans are planning to take a hostage with the debt ceiling
coming up. Then the NYPD offers some advice from a hostage negotiator.
Eugene Robinson and Howard Fineman with the latest on all of that.

And later, the House passes a partial Sandy relief bill, but not
without Republican opposition. Lizz Winstead weighs in on the Sandy 67.

Stay tuned.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW.

Our country really is on the verge of one of the most important
financial discussions that we have ever had. Yet Republicans are planning
to hold Americans hostage by using the debt ceiling to cut the big three,
go after the entitlements. The only move they have is to spread
misinformation in a desperate attempt to gain support, because if you look
at every poll, they don`t have the support that the president has.

Meanwhile, President Obama is going to need to show what leverage he
has. The White House is going to need to position itself perfectly in
order to prevent a financial collapse from happening. The American people
and the president are on one side of the table, the hostage-taking
Republicans on the other side.

How is it all going to work out?

Let`s turn tonight to Eugene Robinson from "The Washington Post", and
NBC News political analyst Howard Fineman.

Great to have both of you with us tonight.

Howard, you first.

How nervous is the White House that they may really have to make some
changes in Social Security in order to avert what the Republicans are
threatening?

HOWARD FINEMAN, MSNBC POLITICAL ANALYST: Well, I don`t think that`s
their number one concern. I think their number one concern is the -- are
the uncontrollable emotions, political emotions of the hard-core of the
Republican Party.

Newt Gingrich can advise them base on his own experience not to go
down that road. But they seem bound and determined to do it.

If you thought the upset over the tax increase was a big deal, wait
until you get a load of this, because the Republican hard-core is even
talking about the notion that the president wants to get rid of the law
that requires a vote on the debt ceiling. They`ve got all kinds of
conspiracy theories going on about that that border on apocalyptic.

And I think that`s the White House`s big concern, that the Republicans
are sort of an uncontrollable and dangerous force. And even if the
Republicans are going to lose politically as they would were there to be a
shutdown --

SCHULTZ: Sure.

FINEMAN: -- it would have a lot of cost economically for the country.

SCHULTZ: Eugene, what is your reaction to Senator Cornyn`s -- I mean,
this guy is in leadership with the Republicans.

EUGENE ROBINSON, THE WASHINGTON POST: Yes.

SCHULTZ: I mean, he just didn`t show up yesterday. He has been
around for a while. He is talking reckless.

ROBINSON: Yes, that`s certainly troubling. Then, again, he is in the
Senate. The Senate is controlled by Democrats. So, of course, there is
the filibuster and everything.

But we assume the Senate is not going to be as much of a problem as
the House.

You know, there is a scenario in which this can work out just fine, as
long as in the end, John Boehner does what he did the last time, which is
recognize reality and allow the debt ceiling to be raised with Democratic
votes and some Republican votes. Now that got him in some trouble last
week and will get him in trouble again if he does it again.

But there may be no other way around it.

SCHULTZ: Greg Sargent, the "Washington Post" interviewed a veteran
NYPD hostage negotiator today about this Standoff. I mean, we`re going
with all angles here, folks. His advice to President Obama may have a
trump card in his back pocket that will resolve the situation without the
GOP`s help. If necessary, one of the most important goals is getting the
hostage taker to realize that ultimately he is not in control of the
situation. I mean, that`s some pretty heavy stuff when we start talking
about true hostage taking.

But it really does come down to business negotiation. Both sides have
to want to make a deal. Are the Republicans, Eugene, in a position where
maybe they don`t want to make a deal? Maybe this is the waterloo for the
economy, and that is the best way to get to the big three?

EUGENE ROBINSON, COLUMNIST, THE WASHINGTON POST: Well, which
Republicans? I don`t think that`s the view frankly of the Republican
leadership, even the leadership of the house. I don`t think John Boehner
wants to send the economy down the tubes and have Republicans and him as
speaker blamed for it. I don`t think he wants that outcome.

But a lot of his caucus wouldn`t mind that outcome. So that`s the
problem. Can he bring them along, can he convince them that they`re not in
control of the situation, and that some accommodation should be made, or
not. And if not, does he then turn to Nancy Pelosi essentially.

SCHULTZ: Sure.

ROBINSON: And the Republicans who are willing to vote to raise it and
proceed in that manner.

SCHULTZ: Howard, a lot of talk about leverage. What better leverage
can president Obama have than the kind of election he had? And also the
will of the people. I mean, going on the road, that his best thing to do
in all of this?

HOWARD FINEMAN, EDITORIAL DIRECTOR, HUFFINGTON POST MEDIA GROUP:
Well, I think that can augment what is already a pretty strong political
position. I mean, what happened ultimately in the fiscal cliff negotiation
that we just went through is that even though the president couldn`t flip a
switch, it eventually became clear to the Republicans that a combination of
the fact that taxes were going to go up on everybody, which is don`t forget
what Mitch McConnell said, and the president`s popularity and the fact that
he won the election, the fact that he is the first one of only eight
presidents now, I think it`s eight, maybe fewer, who have won two straight
elections by more than 51 percent of the popular vote does give him some
sort of hard to quantify but important upper hand.

And I think the Republican psychology, at least among the tea party
people I talked to, they don`t want to pay any attention to that. They
feel that they were rolled in the fiscal cliff negotiations and their last
clear chance to make the kind of statement they want to make will be on the
debt ceiling.

And ironically, I think if as Tim Geithner did, the secretary of the
treasury, float this idea of abolishing the law that requires a
congressional vote, that sort of the ultimate threat that the president
has. Whether he can get that through or not, but that`s the ultimate
nightmare for the tea party.

SCHULTZ: Quickly both of you gentlemen, I want your take on the
filibuster reform that is pending. There is a lot of commentary being
given in the Senate about what should be done. Would this make it a toxic
atmosphere, Eugene, if Harry Reid goes for the full ball of wax and really
smokes them out the way they have been filibustering and changes the rule?
What does that do to debt ceiling negotiations, if anything?

ROBINSON: Well, I think it probably exacerbates the tensions and the
bad feelings in the Senate, and where the feelings are not that bad right
now. I don`t know that he will try to push forward on that before we can
pass --.

SCHULTZ: What about that, Howard?

FINEMAN: I think he might try it. I think he is being pushed to try
it by liberal constituencies who might see that as a payback for a time in
which they`re having to concede on Medicare and Medicaid and so forth. He
may try it. He may try it.

SCHULTZ: Eugene Robinson, Howard Fineman, great to have you with us
tonight. Thanks so much.

ROBINSON: Thanks a lot, Ed.

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

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The Republicans in the house and Senate are going
to decide we`re going to start spending more money.

SCHULTZ: Hurricane Sandy aide is finally on the way. But not before
67 house Republicans vote against disaster relief. We`ll introduce you to
the Sandy 67 next.

REP. BARNEY FRANK (D-MA), FINANCIAL SERVICES COMMITTEE: I told the
governor that I would now like, frankly, to do that.

SCHULTZ: Barney Frank throws his hat in the ring for the
Massachusetts Senate seat.

FRANK: Coach, put me in.

SCHULTZ: I`ll tell you why this is an outstanding idea.

And bill O`Reilly stereotypes Asian-Americans and smears liberals in
the process.

BILL O`REILLY, FOX NEWS ANCHOR: Asian people are not liberal, you
know, by nature. They`re usually more industrious and hardworking.

SCHULTZ: The legendary George Takei is here to straighten O`Reilly
out.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. GREGORY MEEKS (D), NEW YORK: They`ve been suffering. They have
suffered long enough. They need to hear from their government.

(END VIDEO CLIP)

SCHULTZ: More than two months after Sandy hit the east coast, some
help is now on the way. Today, Congress approved a $9.7 billion measure to
keep the national flood insurance program solvent. That`s for the whole
country. The program would have otherwise run out of money next week after
paying out thousands of insurance claims with thousands more to go.

The vote helped John Boehner avoid a bigger political disaster.
Lawmakers from both sides of the aisle attack the speaker for pulling a
larger disaster relief package from consideration earlier this week.
Today`s measure passed by the house by a wide margin of 354-67, all 67 no
votes came from Republicans.

Congressman Tim Huelskamp of Kansas went on right wing radio and
questioned whether Sandy relief is really necessary.

(BEGIN VIDEO CLIP)

REP. TIM HUELSKAMP (R), KANSAS: Well, it`s certainly loaded up with
pork. It`s my understanding that FEMA, which would be spending the money,
has billions of dollars right now. They can`t spend it all quick enough.
And for some reason, this administration and the Republicans in the house
and the Senate decide we`re going to start spending more money. I mean,
they can`t spend it quick enough. And it reminds me of the stimulus
package.

(END VIDEO CLIP)

SCHULTZ: Yet Huelskamp had no problem supporting relief in August to
help folks affected by the drought.

Marsha Blackburn of Tennessee, another all-star, another no vote, was
quick to lobby for federal disaster relief after storms went right through
her district in Tennessee.

Steve Palazzo of Mississippi represents a district that suffered
extensive damage from hurricane Katrina. Yet today, Palazzo voted no to
help the victims of hurricane Sandy.

When severe flooding damaged Paul Ryan`s district in Wisconsin, Ryan
made sure his constituents got government help. His quote was I have been
inspired by the support and compassion demonstrated by Wisconsinites who
have reached out to help their neighbors in need. He said at this the
time.

Today, Ryan made no mention of compassion, noting it would be
irresponsible to raise an insolvent program`s debt ceiling without making
necessary reforms. And of course he voted no.

Joining me tonight, "Daily Show" co-creator Lizz Winstead, who hosted
a benefit to help those affected by hurricane Sandy.

Well, I guess there are no boundaries when it comes to politics in
this country. Great to have you with us tonight, Lizz.

LIZZ WINSTEAD, AUTHOR, LIZZ FREE OR DIE: Thanks, Ed.

SCHULTZ: What do you make of all of this?

WINSTEAD: Living here, and also when the -- when the tornadoes hit in
Minneapolis, I was there helping those folks too with a fantastic mayor
R.T. Rybak. And so, watching this hit my neighborhood and going to Red
Hook and seeing how people couldn`t access a lot of these people. It was
really hard. And helping people clean out their homes after that and
talking to strangers, because you would go in groups. You were assigned by
these fabulous people who were coordinating in Red Hook because there
wasn`t enough money, and people just need to get together. And you go into
somebody`s home, and they`re holding this their children`s baptism gowns
and mold, and the mold is toxic, and you have to convince them to toss that
out and they need to get rid of that.

And you have people voting and there is too much pork in this bill.
It`s like there is pork in every bill. Wake up. You would put people, you
know, at risk and just - and deny them what they need. And then going out
to the Rockaways. And that was a really interesting experience because the
Rockaways was cut off from public transportation. And those people were
stuck out there.

And when we went in, the one thing you needed to do when you go into a
rescue relief areas, you go in with forms. And you have to ask people to
fill them out to find out what they need. Has someone come? Has someone
checked your basement? Have you been drained out? Has your electricity
been off?

And when you go into neighborhoods that are middle class, lower middle
class, black and brown neighborhoods, and you go to the door, and after a
year of this GOP hammering of people, telling them they`re takers, telling
them they got gifts because they voted, and to go in there and ask them for
information, when you go to their door and you`re saying I need to get some
information from you --

SCHULTZ: They`re scared.

WINSTEAD: They`re scarred. What they hear is where do you work,
where do you live? They don`t know who I am. And to hear people say that
these people don`t deserve money; that these people aren`t part of America
when it`s so easy for them. And Paul Ryan`s history of screaming about
programs, and then begging for money for them. And same with Eric Cantor,
you know, it`s just - it`s disgusting. This isn`t the first time.

SCHULTZ: What is dangerous about this, if we don`t fully help the
victims of sandy, it sets a precedent for the next disaster.

WINSTEAD: That`s right.

SCHULTZ: And of course the conversation will come again, well, look
what happened? We didn`t go full bore to help the Sandy victims. This is
just the new America. We don`t help our neighbor out anymore.

Congressman Peter King suggested earlier in the week that people in
New York and New Jersey should no longer give to the house GOP campaign.
He was hot under the collar. Of course, he reversed it when he got the
vote. But is there something to that? Do the people really have power at
this point?

WINSTEAD: I think they do. I first of all will not be giving to any
Republicans. I am going out on record right now in saying that I won`t be.
But I think that people need to speak up. And I think this is something
that over and over and over again we need to remind ourselves. Because if
we say -- do what we say and we vote, congress, it`s a two-term deal.

SCHULTZ: But you have got the club for growth was out lobbying
members to vote no.

WINSTEAD: Great.

SCHULTZ: I mean, this is now -- their culture is now the way they
operate. And they`re going to stick to it. So, how do we break that, when
we have people that you have seen in your neighborhoods trying to put their
lives back together? I mean, you`re in business. You meet payroll.

WINSTEAD: Right.

SCHULTZ: You do things in business. The business interruption is
devastating to a lot of families. I mean people that don`t have paychecks.
The rent isn`t going away. The property taxes aren`t going away. The
fixed expenses aren`t going away. So what would be the best way for the
government to help all of these victims in Sandy, to make sure that these
jobs are going to stay stable?

WINSTEAD: Well, what I would say first off, is when there is a
national disaster or a tragic disaster, every person, can Congress person
and senator who lives in those districts should have to go for a week,
forgo their week and go for a week and help clean up and talk to those
people, and spend time there so that they can see.

And before you vote no, you have to go to those places that you`re
voting no against, or else you don`t get a paycheck, and we know you didn`t
show up.

SCHULTZ: Lizz Winstead, great to have you with us, and thanks for all
you`re doing on this.

Coming up, recently retired Barney Frank offers to head back to the
hill.

And the Senate gets ready to tackle filibuster reform. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: Coming up, actor and activist George Takei joins me to
respond to Bill O`Reilly`s latest racist rant. We`ll be right back.

(COMMERCIAL BREAK)

SCHULTZ: Thanks for stay with us tonight.

Former congressman Barney Frank was in retirement for less than a day
before he announced his intention to hold office one more time. Frank
revealed today that he has already reached out to Massachusetts governor
Deval Patrick and offered to serve as interim senator if John Kerry is
confirmed as secretary of state. Frank cited the fiscal cliff deal as his
motivation to head back to the hill.

(BEGIN VIDEO CLIP)

FRANK: That deal now means that February, March and April are going
to be among the most important months in American financial.

UNIDENTIFIED MALE REPORTER: So you`re considering it?

FRANK: I`m not going to be coy. It`s not anything I`ve ever been
good at. I would tell the governor that I would now like, frankly, to do
that because I would like to be a part of that.

(END VIDEO CLIP)

SCHULTZ: Governor Patrick hasn`t made any decisions yet, but said
Barney Frank would make a great interim senator. Democrats could use a
strong progressive voice like Barney Frank as they stand to tackle other
big issues like filibuster reform.

On Thursday senators Tom Udall, Jeff Merkley and Tom Harkin introduced
a resolution to dramatically overhaul the filibuster senate`s rules,
including a call to establish the talking filibuster rule. I love it. The
change would force senators who filibustered to actually speak on the
floor, unlike the current rules that allow senators to delay action by
simply objecting. Reformers say it`s long overdue because of the
unprecedented use by Republicans in 112 senate at senator Merkley put it.

(BEGIN VIDEO CLIP)

SEN. JEFF MERKLEY (D), OREGON: We need to lay out the elements that
are essential for making the Senate work. An that`s getting rid of the
silent secret filibuster. This is the way that bills are killed, bills
that are important to America. All these bills killed in the dark of night
by filibusters where nobody actually showed up and spent anymore n any time
and energy.

(END VIDEO CLIP)

SCHULTZ: When the Senate resumes work on January 21st, Democrats
will need 51 votes to change the rules.

Tonight, in our survey I asked will Republican lies about Social
Security work on the American people? Twenty five percent of you said yes,
75 percent no.

Coming up, Bill O`Reilly`s latest racist rant has grabbed the
attention of one of the biggest names in social media. We`ll set the
record straight with George Takei next.

(COMMERCIAL BREAK)

SCHULTZ: And finally tonight, the guy who keeps telling us that he is
not a racist just proved himself wrong again. Last night Bill O`Reilly was
spouting off about Hawaii and its Asian-American population.

(BEGIN VIDEO CLIP)

O`REILLY: You know what is shocking, 35 percent of the Hawaiian
population is Asian.

UNIDENTIFIED MALE: Right.

O`REILLY: And Asian people are not liberal, you know, by nature.
They`re usually more industrious and hardworking.

(END VIDEO CLIP)

SCHULTZ: No insult there. Just an hour ago, one of Hawaii`s
representatives demanded an apology. Congresswoman Colleen Hanabusa issued
this statement. Leave it to Bill O`Reilly to thoughtlessly insult 1.3
million people with one sweeping misstatement. The congresswoman said the
next time Bill O`Reilly visits our state, I encourage him to spend more
time getting to know real people and less time sitting next to the pool and
grousing about what he thinks is going on out there.

Bill O`Reilly has insists he is not a racist. Decide for yourself?

(BEGIN VIDEO CLIP)

O`REILLY: Wait, wait, wait. Elvis Presley could sing. He had a good
voice. His songs had words.

UNIDENTIFIED MALE: Yes.

O`REILLY: OK? All right? He put on a show. This is a little fat
guy from Pyongyang, or someplace, Seoul.

UNIDENTIFIED MALE: Wearing sunglasses.

O`REILLY: Whatever. And he is jumping up and down there. So, he is
no comparison between Psy, and you know, there are 16 guys named Psy on
Long Island that I can tell you about. They don`t look like him.

The left hates that. Hates it, because it is racial profiling. But
it`s really criminal profiling. In some African-American communities,
there is a grievance against whites who aren`t sympathetic to their cause.
And that may be driving a little bit of it. So there are some African-
Americans who believe that the reason they`re not prospering as a
community, all right, is because society hasn`t done enough. And the
reason society hasn`t done enough is because of rich white guys. Let`s say
you`re a cocaine deal. And you kind of look like one a little bit.

UNIDENTIFIED MALE: As do you. You look like a cocaine user.

O`REILLY: There is an outreach. I don`t even know what that means,
by the Obama to administration African-Americans. What does that entail?
Are they going to be on "soul train"? Now that is pure racist. Nothing
else.

(END VIDEO CLIP)

SCHULTZ: I agree, Bill, it is pure racism. Let`s bring in actor and
activist George Takei here on "the Ed Show" tonight.

Mr. Takei, great to have you with us.

GEORGE TAKEI, ACTOR, ACTIVIST: Good to be here.

SCHULTZ: You have an unbelievable following in the social media.
People pay attention and look to you for your opinions and your response to
things. Is Bill O`Reilly being racist?

TAKEI: Bill O`Reilly is absolutely clueless, but he pontificates.
And on this thing about Asian-Americans being industrious and hardworking,
well, we`re like all Americans, you know. Yes, we`re industrious and
hardworking, but to characterize that as a Republican trait is totally off
the mark, because the majority of us are Democrats.

I mean you heard from Representative Colleen Hanabusa from Hawaii.
The most distinguished Asian-American elected official passed recently, the
late senator Dan Inouye, awarded an hero from the Second World War, bearer
of the Medal of Honor, distinguished U.S. senator, served for over 50
years. And he was a strong Democrat. Almost every elected official,
Asian-American elected official in Washington is Asian-American. From
California we have Judy Chu and recently elected Congressman Mark Takano.

SCHULTZ: He says it`s shocking that Asian-Americans are hardworking
and they vote for liberals. What is shocking?

TAKEI: We vote for liberals because we are liberal. We believe in
the democratic philosophy. And, yes, there are some Asian-Americans that
are Republicans, but, you know, many of them, I would venture to say, are
Republicans because it was a Democrat who put us in internment camps during
the Second World War, and also dropped the atomic bomb on Hiroshima and
Nagasaki. But the majority of Asian-Americans are Democrats. And we are
very liberal, because the Democratic philosophy is one that is better for
Asian-Americans.

SCHULTZ: And Bill O`Reilly denies that there was any national racism
after World War II. You experienced that in your life, have you not?

TAKEI: We were in prison camps, barbed wire fence, century towers,
machine guns pointed at us, searchlights following us at night when we made
the night run to the latrine. When we came out of camp, we were literally
penniless. And I remember our family lived on skid row for a few months,
like many, many Japanese-American families. And I remember a teach they`re
kept calling me the little Jap boy.

No, the racism was intense, certainly during the war, and after the
war. We`re Americans. My mother was born in Sacramento. My father was a
San Franciscan. My siblings and I were born in Los Angeles. Innocent
Americans who were put into prison camps. Is that not racism?

SCHULTZ: It is. And it also -- I find it very insulting that bill
O`Reilly or anyone would have to qualify Asian-Americans as hardworking.
In a roundabout way I think that is demeaning in itself. But I guess it`s
still up for interpretation from people on that side of the aisle.

George Takei, I really appreciate your time tonight on "the Ed Show."
Thank you so much.

That is "the Ed Show." I`m Ed Schultz. The " Rachel Maddow" show
starts right now.

Good evening, Rachel.

RACHEL MADDOW, MSNBC HOST, THE RACHEL MADDOW SHOW: Good evening, Ed.
And Have a great weekend, my friend. Thanks a lot.

SCHULTZ: You too. Thank you.

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

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