updated 2/26/2013 11:05:34 AM ET 2013-02-26T16:05:34

THE ED SHOW with ED SCHULTZ
February 25, 2013


Guests: James Carville, John Garamendi, Marcy Kaptur, Keith Ellison, Sam Stein, Heather McGhee, Richard Wolffe, David Edelstein


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

Well, here we are. It`s sequester week in Washington, and House
Republicans aren`t negotiating. They`re not even on the clock, like you
and me.

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

(BEGIN VIDEOTAPE)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: These cuts do not have
to happen. Congress can turn them off any time with just a little bit of
compromise.

SCHULTZ (voice-over): Four days until the sequester starts killing
700,000 jobs. And the speaker of the House is clueless.

REPORTER: Do you have a sense of how many jobs will be lost as a
result of the sequester?

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: I do not.

SCHULTZ: Tonight, the one and only James Carville on the Republican
obstruction threatening to cripple the middle class.

The big congressional panel on how the sequester will cost middle
classers in their districts.

Plus, Eric Cantor is using the video game "World of Warcraft" to
deceive the public.

The plot to steal electoral votes moves forward in Pennsylvania.

And the first lady made movie history at the Academy Awards.

MICHELLE OBAMA, FIRST LADY: I am so honored to help introduce this
year`s nominees for best picture.

SCHULTZ: Tonight, the story behind Michelle Obama`s Oscar surprise.

(END VIDEOTAPE)

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

Republicans basically have embarked on a campaign to go across America
and blame the president for the upcoming sequester. Now according to House
GOP leaders, the president hasn`t even tried to negotiate.

(BEGIN VIDEO CLIP)

REP. ERIC CANTOR (R-VA), MAJORITY LEADER: Well, the president really
ought to stop campaigning and come back to the table and work with us. We
care about what happens to this economy and the people who sent us here.

(END VIDEO CLIP)

SCHULTZ: Well, if Eric Cantor cares so much, he shouldn`t be ignoring
the proposal the president has put on the table, because it`s got a few
lefties upset.

The president has offered an additional $1.8 trillion in deficit
reduction. More than $1 trillion comes from new spending cuts. The plan
includes chained CPI, which, of course, is a reduction to Social Security
benefits

Now hold it right there, folks. My head can explode in 20 seconds of
commentary.

his is not what this election was all about. There is no poll out
there that shows that the majority of Americans want to dig into Social
Security so the wealthy can have more tax breaks which, of course, is what
the Republicans are all about. The plan that is on the table now, the plan
is definitely compromise coming from the White House.

But it is hard to negotiate with somebody who has basically drawn a
line in the sand. Republicans have said repeatedly, there will be no new
revenues.

Here is Congressman Tom Cole of Oklahoma. He was asked earlier today,
is there any -- any chance whatsoever that Republicans would put new
revenue on the table?

(BEGIN VIDEO CLIP)

REP. TOM COLE (R), OKLAHOMA: No, there`s not. The president got
revenue six weeks ago with no spending cuts whatsoever. This time, it`s
spending cuts with no revenue. Down the road, we`ll have another
negotiation over the budget and the continuing resolution, eventually the
debt ceiling again.

But in this case, I don`t think there`s any room for revenue at all.

(END VIDEO CLIP)

SCHULTZ: This is what you do when there is a mistake in a game. You
call time-out.

I am sick and tired of hearing the Republicans saying that the
president got new revenue. That was the expiration of the Bush tax cuts.
Everybody with a brain knows that. That`s not new revenue. That doesn`t
take us beyond the rates that we used to have.

But this is the Republican strategy. You have to negotiate with them
on their terms or you`re not going to save jobs in America.

John Boehner isn`t even concerned about the immediate loss of jobs
from the sequester.

(BEGIN VIDEO CLIP)

REPORTER: Do you have a sense of how many jobs will be lost as a
result of this sequester?

BOEHNER: I do not. But I can tell you this -- if we don`t solve the
spending problem here in Washington, there will be tens of millions of jobs
in the future that won`t happen because of the debt load that is being laid
on the backs of our kids and our grandkids.

(END VIDEO CLIP)

SCHULTZ: Well, then why don`t you take the deal the president`s got
on the table, Mr. Boehner?

Republicans are willing to see people lose their jobs. They are
willing to see projects and services fall by the wayside.

This is the new mantle of obstruction. President Obama is using all
of his resources to put a public face on these upcoming cuts. And folks,
they are real.

The transportation secretary already explained how the cuts will
create a national travel slowdown. Tell that to your business friends.

Today, the homeland security secretary reinforced this point.

(BEGIN VIDEO CLIP)

JANET NAPOLITANO, HOMELAND SECURITY SECRETARY: The lines over the
next few weeks are going to start to lengthen in some dramatic ways in
parts of the country.

(END VIDEO CLIP)

SCHULTZ: Ah, just what we`re looking for.

Democrats in Congress are highlighting this for the traveling public.
It`s the best way to explain how everybody is going to feel the pinch, the
pain because of these cuts.

(BEGIN VIDEO CLIPS)

REP. JIM MORAN (D), VIRGINIA: We can`t allow a manufactured invented
crisis to harm economically indispensable government services.

REP. GERRY CONNELLY (D), VIRGINIA: There are going to be real
consequences for anybody who travels in America, for anyone who comes into
a port in America, and for the people who screen us to make sure we`re
safe.

(END VIDEO CLIPS)

SCHULTZ: Now, of course, Republicans are calling that all scare
tactics. Well, scare on this one. Officials from states dealing with
hurricane Sandy -- well, they say the damage also is going to hurt in the
cuts is going to have an affect on the recovery.

(BEGIN VIDEO CLIP)

REP. BILL PASCRELL (D), NEW JERSEY: This is nothing short of a fiscal
hurricane, a fiscal storm for the victims that are already been devastated
by Sandy.

(END VIDEO CLIP)

SCHULTZ: These are the consequences of Republicans not budging on any
revenue whatsoever. But Democrats, they`ve got a line in the sand, too. A
hundred and seven congressional Democrats have signed a letter saying no
cuts whatsoever to Medicare, Medicaid and Social Security. They know what
the election was about.

There is revenue available to keep the big three intact. And, of
course, the Democrats, what they want to do, and something that the
Republicans haven`t identified, the Democrats want to close some loopholes.
And they want to cut subsidies to big oil and big agro business. These big
agro companies, they don`t need the kind of money that they`re getting.

And, of course, the Democrats want to go down to the road to the
Buffett Rule -- higher taxes on millionaires. Kind of even things out with
the secretary, you know, the people that actually work in the office,
Warren Buffett has a better deal, you know that story. Seventy-six percent
of Americans want a balanced approach.

This is balanced what the president has on the table and he is accused
of not negotiating? The president already signed $1.7 trillion in cuts
before we even got to the sequester. He got $737 billion in revenue from
the expiration of the Bush tax cuts. This is not even new revenue. It`s
going back to the old rate it expired.

And the president did exactly what he said he was going to do. He did
not let those taxes go up on middle class Americans.

So, the country still needs nearly $1 billion in revenue to get this
balanced plan. Republicans would rather dig in their heels. They are
taking the country down a path of ruin, and they`re not even concerned with
it, and not concerned with the consequences. And they`ve got this thing
pretty well figured out. Here are a lot of talk about gerrymandering.

Let`s take the state of Virginia, for instance. In the state of
Virginia, there are 11 congressional seats. Three of them are Democrats.
Really? How in the world did President Obama ever win the state of
Virginia? Well, he did. And the gerrymandering is protecting all of these
righty seats in the state of Virginia.

Ironically, it`s Governor McDonnell who is coming out saying hey, you
know what? This is really going to hurt our constituents. Do we really
want to go down this road? These are real cuts.

But if you do the numbers, there`s 234 Republicans in the House.
Fifteen of them probably could be defeated if the races were resourced
properly by the Democrats. They think they`ve got 219 that are untouchable
because of the gerrymandering that has taken place in this country and what
the Republicans have done.

They`re on safe territory. They don`t feel like they have to
negotiate with the president. What they`re going to do is allow these cuts
to go in. They`re going to blame the president on the economy.

Boehner knows exactly how many jobs this is going to hurt. And he
knows exactly how this is going to hurt small business. And then they want
to blame it on the Democrats. And then they`ll just limp to the midterm.

And so, we`re going to be here fighting back and forth, doing this
P.R. war as to whose fault it really is. Are we ready for that? Is that
what you and I are paying for?

We can`t get these guys to go to work, and when they go to work, they
can`t agree on anything.

Get your cell phones out. I want to know what you think. Tonight`s
question: will the Republicans` plan of obstruction backfire with voters?
Text A for yes, text B for no to 67622. You can always go to our blog at
Ed.MSNBC.com. We`ll bring you results later on in the show.

Joining me tonight, the great James Carville. He`s been down this
road a whole bunch of time. Democrat strategist, political consultant and
author of "It`s the Middle Class, Stupid."

And let me respond to that. It sure is.

If the Democrats can`t draw their line in the sand, James, what does
this mean for the future of the party if they`re going to turn over every
time something like this comes up?

Your thoughts.

JAMES CARVILLE, POLITICAL CONSULTANT: First of all, I don`t think
they have turned over.

Secondly, this is what the Republicans say. Government doesn`t do any
good. It just gets in the way.

So, we`re going to find out how much government gets in your way.
You`re talking about, you know, airports and you know custom officials.
You`re talking about national parks, a lot of things.

So, we`re going to get a good lesson here in this country of how --
what the government does and how it affects people.

But they`re completely unconcerned about this. John Boehner said in
April 2011, he got 98 percent of what he wanted.

I`m not sure that a lot of that caucus is not just delighted with
this. I really -- I really believe that. I think they`re actually excited
about this.

It meats me why. It`s going to really hurt middle class people a lot.
Macro-economic advisers out of St. Louis, probably the most respected in
the country say this is going to shave 6/10 a percentage off GDP, which is
pretty substantial given how low the growth was.

SCHULTZ: Well, if you`ve got a $3.5 trillion budget for the year and
you`re going to yank $85 billion out of it over a seven-month period,
obviously it`s going to have an affect.

But Republicans don`t even seem to be on the sage page with their
message. Some of them say the cuts are President Obama`s fault, and the
others are saying the cuts are no big deal. Here it is.

(BEGIN VIDEO CLIP)

SEN. RAND PAUL (R), KENTUCKY: I would say balderdash. It`s untrue,
unfair, dishonest, disingenuous. The president is making stuff up.

(END VIDEO CLIP)

SCHULTZ: Why are they having such a hard time with their message?

CARVILLE: Well, the truth of the matter is they came up with the idea
because they said this is so insane, this is so out of bounds that no one
would allow this to happen so we would negotiate.

And the White House, I think it`s legitimate to say that they
underestimated just how Republicans -- what lengths they would go to. But
the Republicans actually like this. They`re all out there saying this
doesn`t hurt anything.

You`re just cutting government a teeny bit. It`s nothing to worry
about. This is no big deal. It`s the only way we can get spending under
control.

The Republicans are actually embracing this. It`s -- they want it,
they can have it. Wow.

SCHULTZ: We`ve been down this same road 18 years ago. Let`s take a
look.

(BEGIN VIDEO CLIP)

WILLIAM J. CLINTON, FORMER U.S. PRESIDENT: Unfortunately, Republican
leaders in Washington have put ideology ahead of common sense and shared
values in their pursuit of a budget plan. We can balance the budget
without doing what they seek to do. We can balance the budget without the
deep cuts in education, without the deep cuts in the environment, without
letting Medicare wither on the vine.

(END VIDEO CLIP)

SCHULTZ: Now, James, you know Republicans got killed in the polls
when they shut down the government down in 1995. Will the outcome be the
same this time around?

CARVILLE: You know, go back and remember what President Clinton said.
You know what is interesting? Every word he said was true.

SCHULTZ: Yes.

CARVILLE: He said we can balance the budget without doing all those
things. And guess what happened? We did balance the budget. We didn`t
destroy Medicare. We didn`t destroy education.

We were able to do that. And they didn`t want to do that.

And President Clinton stood up, just like today. They`re sitting
there saying who needs government?

They`re excited about shutting this stuff down. You watch them on TV.
They think this is good. They think that this gets in the way. They`re
going to find out just what it is.

And they`re going to find out in a Defense Department what this is
like. And a lot of places like that.

You know, you got to understand. Their whole philosophy is government
is a bad thing. And so, if you have less of a bad thing, you`re better
off.

SCHULTZ: You think the president is going to get any help from the
Republican governors that know how bad it`s going to be in their backyard?

CARVILLE: I think -- I think the phone is going to start ringing.
Not only that, I think they`re going to get some help from the business
community that knows how bad this is. I think they`re going to get some
help from the national defense community, which knows how bad this is. I
think they`re going to get some is help from places where all these
national parks are that are going to be cut that so much of the commerce
around these areas depends on this.

I think they`re going to get a lot of phone calls.

SCHULTZ: Yes.

CARVILLE: And they`re going to be surprised because they`re going to
find out that the government does a lot of worthwhile things.

SCHULTZ: You see a parallel between President Obama handling this the
same way Clinton did?

CARVILLE: Well, it was a little bit of two different things. But I
think that President Obama now realizes that he just kept going along with
them and coming up with this and they just kept moving the ball on him.
And now he is saying, look, I have put $1.8 million in deficit reduction
out there.

That`s the legislation called for in August of 2011. It didn`t say
spending cuts. It actually said deficit reduction. He has $1.8 trillion
on the table.

SCHULTZ: Yes.

CARVILLE: I`m like, I think some of this stuff unduly hurts middle
class. You know, there is a story today in the paper that health care
costs have flattened so much it`s saving hundreds of millions of dollars.

SCHULTZ: Sure, it is.

CARVILLE: There was a wonderful story in "Time" magazine how Medicare
delivers health care much cheaper than any other system anywhere here in
the United States. People should read that, because it`s an important
thing in this health care debate.

SCHULTZ: Yes.

CARVILLE: So -- but at any rate, he probably started out further than
a lot of Democrats like to go. But the president has already put $1.8
million in --

(CROSSTALK)

SCHULTZ: And the other thing that`s different is that I think they do
a better job of lying right now than they did back in your day. I think
they`re doing a heck of a job of that.

James Carville, always a pleasure to have you on THE ED SHOW.

CARVILLE: Thank you. You bet, you bet.

SCHULTZ: 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 want to know what you think.

A new White House report lays out exactly how folks are going to be
affected by the sequester. The congressional panel tells us what it means
for their communities and all middle classers.

Stay tuned. We`re right back.

(COMMERCIAL BREAK)

SCHULTZ: Republicans are obstructing and the middle class is going to
pay for it. Up next, the congressional panel on how the sequester is going
to be punishing people in their districts.

And later, big surprises led to big ratings for last night`s Oscars.
We`ll have the highlights and low lights from the Academy Awards.

You can listen to my radio show tomorrow on Sirius XM Radio Channel
127, Monday through Friday, noon to 3:00 p.m.

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

We`re coming right back with the congressional panel.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: All of us are concerned about our politics, both in our own
parties as well as the other parties. But at some point, we`ve got to do
some governing.

(END VIDEO CLIP)

SCHULTZ: President Obama speaking today to the nation`s governors,
with just four more days until the sequester hits, the White House is
sounding an alarm, with a new report providing details on how these cuts
will affect all 50 states.

And the state by state calculations, my friends, are pretty grim. No
area or issue goes uncut from law enforcement to clean air and water
programs.

We`d see a slowdown of Sandy cleanup in New Jersey. We`d see military
cutbacks in the state of Texas, and fewer children would be vaccinated in
Georgia. In California, 9,600 low income students could lose their
financial aid.

In the state of Ohio, hundreds of teachers and teachers` aides are at
risk of losing their jobs. And in the state of Minnesota, thousands of
unemployed folks will not get the training and assistance they need to find
a job.

Despite those stark numbers, House Speaker John Boehner says that he
is not budging.

(BEGIN VIDEO CLIP)

BOEHNER: Listen, the president says we have to have another tax
increase in order to avoid the sequester. Well, Mr. President, you got
your tax increase. It`s time to cut spending here in Washington.

(END VIDEO CLIP)

SCHULTZ: Joining me tonight on the congressional panel: Congressman
John Garamendi of California, Congresswoman Marcy Kaptur of Ohio, and
Congressman Keith Ellison of Minnesota.

Great to have you with us tonight.

REP. MARCY KAPTUR (D), OHIO: Thank you.

SCHULTZ: Let`s, first, respond to what the Republicans are saying.

John, you first. They`re saying no revenue. Where does that leave
us?

REP. JOHN GARAMENDI (D), CALIFORNIA: Well, the American people know
what we should do. And that`s a balanced approach. You gave the
statistics a moment ago, Ed. America wants a balanced, they want a
compromise.

Some taxes, some cuts. We can do that. The proposal has been on the
table now for more than three weeks. And we`ve got the revenue out there.
We need to get that revenue back from the oil industry.

My God, they got enough of our money at the pump. We don`t need to
give them a subsidy. That`s but one example of many, many.

SCHULTZ: Marcy, your thoughts on getting the Republicans to give up
revenue, or is there going to be a deal without revenue?

KAPTUR: I don`t think for the Democrats there can be a deal without
revenue because we need a balanced plan. In the original bill that passed,
we provided revenue, but that was on individuals` incomes.

As Congressman Garamendi has said, there are so many loopholes in the
tax code, why should children in Ohio who are disabled have to pay the
price for those who are offshoring jobs and not paying their fair share of
the load? Why should the unemployed in Ohio or anywhere have their
unemployment benefits cut by 9 percent to 11 percent? You`re talking
millions of Americans who are living at the edge.

SCHULTZ: Yes.

KAPTUR: And our senior citizens who are going to have their nutrition
programs cut in Ohio, three-quarters of a million dollars cut out of those
programs. What are they going to do? Give them fewer green beans?

SCHULTZ: You`re right. A lot of the programs slated for cuts are
extremely popular with the public. Their polling is very strong for the
Democrats.

Congressman Ellison, what you hearing from your constituents in
Minnesota?

REP. KEITH ELLISON (D), MINNESOTA: Well, what I`m hearing is we still
have a number of people unemployed. And the training and the assistance
that they get to get back into the workforce is going to be dramatically
cut, and thousands of people will suffer. Not only that, food assistance,
law enforcement.

But I want to go back to another quote that John Boehner had about two
years ago. And that is that if they won`t eat the whole loaf, we`re going
give it to them a slice at a time.

And what the Republicans have done since then is set up crisis after
crisis after crisis. And this is just the latest one. We got another one
we`re dealing with in just over a month when the continuing resolution
comes up. We just passed one with the fiscal cliff. So, this Friday, here
we are one more time, seeing the fulfillment of a philosophy of reducing
government to the size you can drown it in a bathtub.

SCHULTZ: Congressman Garamendi, military cuts are going to hit your
state of California really hard. Can you put a number on how many jobs
that would affect?

GARAMENDI: Well, the jobs are going to be enormous. We`ve had five
hearings in the House Armed Services Committee with the top generals and
Secretary Panetta and others coming in and saying we can`t stand this.
This is going to be a horrible problem for the safety of this country.

And to hear Mr. Boehner and others simply say it`s no problem, hey,
the military says it`s a big problem.

Travis Air Force Base, they`re looking at not being able to do the
kind of training that is necessary, the readiness that is necessary.
You`re looking at a loss of some $30 million of wages. They`re clearly
going to be layoffs among the civil servants, 3,200 there.

Some of those people are going to be lose their jobs. The rest are
going to clearly be on furlough, losing perhaps 20 hours of work or more.

You are looking at the Coast Guard. Take a look at the Coast Guard,
just this cruise ship incident. The Coast Guard is going to lose 20
percent of its ability to do its job. What are we talking about here?
This is terrible for the nation`s security. It`s terrible for the health
of the people of this nation.

SCHULTZ: You have a Republican Party that will not budge. These cuts
are going to go into effect. The only solution is to hold the line.

Congresswoman Kaptur, do you think the Democrats have the intestinal
fortitude? I know you have signed on to this letter of 107 of your
colleagues that say no cuts in Medicare, Medicaid and Social Security.
This is going to be who blinks first.

KAPTUR: Well, I think that the Republicans, at least this particular
group, care more about manufacturing crises than manufacturing jobs.

And we have to hold the line. We know that there is a lot of ill will
toward the president. He won the election. And what they`re trying to do,
though, is to stop his program in its tracks because they`re not satisfied
with what happened last November. But you shouldn`t do this to the
American people.

SCHULTZ: You think these Republican governors will help? You`ve got
a Republican governor there in Ohio in John Kasich. You think he`ll help
the president?

KAPTUR: I hope he`ll help because in the speaker`s home state of
Ohio, over 26,000 personnel who work for Wright-Patterson Air Force Base
and our garden reserve facilities across the state are going to be
furloughed, 13,000 of those in the speaker`s own backyard. Up at NASA,
Glenn-Lewis, and Cleveland Brookpark, we think we`re going to lose the
cryogenic hydrogen program.

SCHULTZ: Yes.

KAPTUR: And power program, which is one of the two major missions of
that site.

So this is going to be felt throughout Ohio. And we`re a state that
is crawling its way forward to recover. We don`t need more job loss or
underinvestment in states like Ohio.

SCHULTZ: Yes. Senator Rand Paul says local law enforcement won`t be
affected by the cuts. Keith, you want to answer that?

ELLISON: That`s absolutely not true. In the state of Minnesota,
several law enforcement programs, people who protect our streets, people
who run to the crisis when the rest of us are running away from it are
going to see cuts and possibly layoffs.

The fact of the matter is, this is the most irresponsible legislative
action I`ve ever seen. And I believe that the American people are going to
get first hadn`t experience as to what Senator Paul`s philosophy really
does mean. Shrinking government down, cutting government down,
government`s the problem.

We`re going to find out sadly how wrong he really is. But I hope --

SCHULTZ: These tax loopholes that we`re talking about, we`re talking
about oil and gas. We`re talking about big agro business.

ELLISON: Yachts and jets.

SCHULTZ: What about that?

ELLISON: Yachts and jets.

SCHULTZ: Yachts and jets, no doubt. This is plenty of money to be
found there.

John, you`re on the -- you`re on the ag committee. Can these
subsidies be cut and agriculture still be strong in America?

GARAMENDI: Oh, absolutely, it can. In fact, the two farm bills, one
from the Senate, one from the House did reduce these subsidies that are now
being discussed as part of the Democratic proposal.

Senator Stabenow has been working on this. She`s figured out how to
make this happen in a way that does not harm agriculture. It shifts over
to an insurance program.

But, Ed, let`s go back to the beginning here. These issues were
thought to be so bad, the sequester was thought to be so terrible that it
wouldn`t happen. And now, the Republicans are embracing what everybody
said was so bad that it couldn`t possibly happen.

I don`t understand where they`re coming from.

SCHULTZ: It`s all about President Obama. That`s a big part of the
equation, I think.

GARAMENDI: I`m afraid so.

SCHULTZ: Congressman John Garamendi, Congresswoman Marcy Kaptur and
Congressman Keith Ellison, great to have you on the program tonight.

Eric Cantor`s world of lies about the World of Warcraft. We`ll are
the facts between the GOP`s latest dishonest talking points.

And the Tea Party governors agree with President Obama on spending.
The big panel on the president`s big plan for infrastructure.

Stay with us. We`re coming right back.

(COMMERCIAL BREAK)

SCHULTZ: Welcome back to THE ED SHOW. Seems like every time
Republicans don`t have their facts on their side, they just go ahead and
make stuff up. Let`s take the sequester, for instance.

The country wants a mix of tax increases and spending cuts to undo the
austerity bomb. Instead of compromising on those, republicans are making
stuff up where? On Twitter. Here is a Tweet from House Leader Eric
Cantor: "President Obama wants to raise your taxes so he can pay people 1.2
million dollars to play World of Warcraft?"

And of course Cantor`s buddies in the House leadership all followed
suit with similar Tweets complaining about the spending on World of
Warcraft. This is World of Warcraft here on the wall. I never heard of it
before until we were doing the story tonight. It`s one of those violent
fantasy video games that kids like to play.

So why in the world would President Obama want to spend over a million
dollars to pay people to play video games? Well, it turns out there is a
real good reason. The National Science Foundation, something that the
Republicans are always short on, science, that foundation awarded North
Carolina State University two grants totaling 1.2 million dollars to study
whether video games can slow mental declines in senior citizens.

Seniors played puzzle games as well to understand how video games can
improve cognition, develop games for seniors that will improve cognitive
function, and reduce the cost and impact of diseases like dementia and
Alzheimer`s on the health care system. And it turns out that Cantor was
wrong about the game.

In fact, it turns out the seniors aren`t playing World of Warcraft.
They`re playing games like Boom Blocks and a simple puzzle action game like
Jenga.

Wrong again, Cantor.

Not only is Eric Cantor and the Republicans lying to you one more
time. They are demonizing a program that could help America`s seniors deal
with diseases like Alzheimer`s and Dementia. The facts aren`t on their
side, so they`re just making stuff up again.

(BEGIN VIDEO CLIP)

OBAMA: Whatever your party, the last thing you want to see is
Washington get in the way of progress.

(END VIDEO CLIP)

SCHULTZ: The president takes his case to Republican governors.

(BEGIN VIDEO CLIP)

OBAMA: You`re the ones who are on the ground, seeing firsthand every
single day what works.

(END VIDEO CLIP)

SCHULTZ: Up next, the big panel weighs in on the president`s strategy
to go around D.C. Republicans.

Pennsylvania Republicans have another trick up their sleeve to steal
electoral votes.

And forget the sock puppets and the talking bears. The First Lady
stole the show at last night`s Academy Awards.

(BEGIN VIDEO CLIP)

MICHELLE OBAMA, FIRST LADY: And now for the moment we have all been
waiting for.

(END VIDEO CLIP)

SCHULTZ: Ahead, David Edelstein on the Oscar`s big winners, big
losers, and the big surprises.

(COMMERCIAL BREAK)

SCHULTZ: Thanks for staying with us tonight. Republicans in Congress
say fixing our crumbling infrastructure is like a crazy left-wing idea.
And they`ll fight every spending proposal. But there is another group of
powerful Republicans which totally disagrees. Today President Obama
avoided the naysayers in Congress and appealed directly to the Tea Party
Republicans who agree with him on infrastructure.

(BEGIN VIDEO CLIP)

OBAMA: I know that some people in Congress reflexively oppose any
idea that I put forward, even if it`s an idea they once supported. But
rebuilding infrastructure is not my idea. It`s everybody`s idea. It`s
what built this country.

(END VIDEO CLIP)

SCHULTZ: The president explained how his Fix It First plan would put
people to work to make critical repairs. Then he sweetened the deal by
offering regional teams to help every governor access federal funding. For
instance, the president is offering help with renewable energy projects in
the Pacific Northwest. The northeast corridor would get faster high speed
rail service.

Governors in the Midwest and in Colorado would get help improving
water access to deal with the drought. And the Dakotas and Montana, the
regional team would focus on oil and gas production. The president is
offering these -- this kind of help to every state because the benefits are
obvious.

(BEGIN VIDEO CLIP)

OBAMA: This didn`t used to be a bipartisan issue? I don`t know when
exactly that happened. It should be a no-brainer.

(END VIDEO CLIP)

SCHULTZ: The president has found the sweet spot with the nation`s
most conservative governors on infrastructure. Republicans like Jan
Brewer, Sam Brownback, Rick Scott and Rick Perry are asking their
legislators in their state for more infrastructure funding. Unlike
Congress, these Republican governors realize that compromise is the key to
improving their states and their political futures.

Let`s turn to Sam Stein, political reporter of the "Huffington Post."
With us tonight, Heather McGhee, vice president of policy and outreach at
"Demos," and also Richard Wolffe with us tonight, vice president and
executive editor of MSNBC.com.

Richard, you first. Employing these Republican governors, playing to
what they`re advocating in their states, how good and how effective could
this be?

RICHARD WOLFFE, MSNBC.COM EXECUTIVE EDITOR: Well, the president has
faced tougher oppositions not just from Republicans, but from Republican
governors on his signature health care reform legislation. And what we
have seen in the last several weeks and months is that these Republican
governors, no matter what their rhetoric, no matter what their national
aspirations, have begun to crack.

Because in the end, they are going to be measured by what they can
deliver to folks in their state. So I think it has been effective. I
think it will be effective. Will it change the nature of the debate among
House Republicans? No. But it does say to the public, Republicans are a
much more varied group than just what you hear out of John Boehner`s mouth.

SCHULTZ: Heather, how can crumbling bridges across America be a
political issue? You`re either going to fix it or you`re not going to fix
it. Has he kind of cornered the Republicans on this?

HEATHER MCGHEE, "DEMOS": I think he has. I mean, there is
overwhelming support by the public for not just infrastructure, for the
fact that we want to have safe roads to drive on and mass transit to get to
work. But also because people know that it creates jobs. I mean, if you
look at what you get in terms of bang for the buck from the dollars that
could be spent on job creation, infrastructure spending is one of the
highest ones.

It`s actually five times as strong as corporate tax -- as corporate
tax giveaways. So, you know, we`ve still got tens of millions of Americans
who are out of work or looking for more work to put food on their tables.
And we need to be looking at what is going to create more jobs.

SCHULTZ: Sam, how effective is Governor McDonnell going to be in
Virginia, when he basically is siding with the president on this? This
could turn him awry with some others. What do you think?

SAM STEIN, "THE HUFFINGTON POST": Yes. Well, so the back story here
is that Governor McDonnell passed a landmark transportation plan through
Virginia -- through the Virginia State House in large part by, you know,
relying on revenue raisers. And it`s endeared him to the sort of
pragmatists in the party. But it`s made him a, you know, villain of some
sorts among the conservative in the party, who think that by sheer fact of
raising taxes and revenues to pay for this, he is a traitor of some sort.

So I`m waiting eagerly to see how this plays out, whether it helps him
politically or not. I have to say, I`m not as bullish about the prospects
of something done federally on transportation. President Obama has tried
in various forms, in various bills, to put a 50 billion dollar
infrastructure bank into action. It`s failed every single time.

I think the much more likely scenario is that states go first, ask the
federal government for matching funds of some sort, and then the federal
government is forced to act. I think that`s the much more likely scenario.

SCHULTZ: I mean, Richard, the president is going to the people. The
president is going to governors. The president is going everywhere he can
to try to get the Republicans to move. They say no revenue. Where does
this end up?

WOLFFE: Oh, I think this falls into a much bigger discussion where we
are getting into the furlough question and partial government shutdowns.
You know, this will -- this fever will break. And it will break because
people understand what it means for jobs. But it`s also the way things
used to get done in Washington.

I`m not saying this was a great period in Washington, but earmarks,
transportation projects were what greased the wheels of legislation along.
And it will come back. Because that`s how things will get done again.

SCHULTZ: Heather, what do you think of Louisiana Governor Bobby
Jindal, says that the president is just trying the scare Americans when he
starts talking about all the jobs that are going to be lost and all the
people that are going to be affected, the programs that are going to be
cut, and also the travel appeal? I mean, that`s what is going to affect
people the most.

When business travelers are knocked out for six or seven hours because
of logistics, that`s going to get a lot of people`s attention. But Jindal
says he is just scaring Americans. What about that?

MCGHEE: I think it`s great that the president is going out, speaking
directly to the American people about simply what is government and what
actually are the millions of different ways that what we do together that
we can`t do ourselves is actually really helping us on a day-to-day basis.
Because if he were to stay in Washington, he would really be surrounded by
the Beltway donor class, which is who we know is actually pushing the
austerity agenda.

You know, affluent Americans who make up the donor class is twice as
likely to want to push an austerity agenda, to want to protect from tax
cuts, want to be pushing for changes to entitlements. So we really need
the president to be doing exactly what he is doing, which is going out to
people who are close to the ground, talking to the American people
directly, talking to governors and saying, you know what? This is what
government does in our lives, and it`s worth paying for.

STEIN: And can I add that the notion that if President Obama just sat
around the table a little bit more with John Boehner and Eric Cantor and
that would persuade them to drop their resistance to revenue hikes is
silly. They would never do it. It`s a matter of principle for them. So
I`m not sure what he gets by visiting their offices, by going to the Hill,
by having them over to the White House.

I think this is obviously a political way of getting them to come to
yes on this. And I do agree that there is a benefit to getting outside of
the echo chamber of the bubble, seeing real people, getting their stories
out there and publicizing it.

SCHULTZ: Sam, I`ve got to ask you quickly.

STEIN: Sure.

SCHULTZ: Inside the bubble, maybe I`m missing this, why isn`t the
Washington media pushing the Republicans to identify loop holes? Why can`t
we get one loophole from the Republicans in this deal?

STEIN: I don`t know. I mean, because they`ve declared that the
revenue debate is over, right? And so if you declare that the debate is
over, there is no logical follow-up question which says which loophole
would you like to close.

SCHULTZ: But they said during the campaign -- they said during the
campaign that they would close loop holes. They were supporting Romney
back then.

STEIN: Correct.

SCHULTZ: But now they won`t support any loopholes whatsoever, nor
will they identify them.

STEIN: The bigger debate is what -- if you do close those loopholes,
what does it go for? And if Republicans say that it shouldn`t be for
deficit reduction, it should be to lower the tax codes, then it`s a non-
starter for Democrats.

SCHULTZ: All right, Sam Stein, Heather McGhee, Richard Wolffe, great
to have you on with us.

STEIN: Thanks, Ed.

SCHULTZ: Just ahead, the Republican plan to steal electoral votes is
going forward in one state. That`s Pennsylvania. We`ll have the details
next. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: We brought you a number of stories on this program about the
Republican effort to rig future presidential elections. So far, attempts
by Republicans in four swing states to rig electoral college votes have
failed. But this is not the case in Pennsylvania. Keystone State
Republicans have just introduced a new bill that would change the way they
allocate electoral votes.

Under the plan, a large chunk of Pennsylvania`s electoral votes would
be awarded to the Republican candidate, even if they didn`t win the state.
Two votes would go to the winner of the popular vote, but the rest would be
split based on vote percentage. Gerrymandering, that`s what it`s all about
for them.

If bills like this are passed in other swing states, it would greatly
increase the chances of a Republican winning the White House. Not
surprisingly, this bill comes right out of the RNC chair`s playbook. In
January, Reince Priebus said Republican-controlled swing states should
change the way they award electoral votes. He argued a new system would
give more control to states.

However, we should point out no such bills have been introduced in any
solid red states. In the past, Pennsylvania Governor Tom Corbett has
supported similar vote-rigging legislation, but this time around he has
remained silent on the current bill. The governor is up for a tough
reelection battle in 2014.

I`m guessing Corbett knows the people of Pennsylvania do not
appreciate Republicans rigging presidential elections.

Tonight in our survey, I asked you will the Republican plan of
obstruction backfire with voters? Ninety five percent of you say yes; five
percent of you say no.

Michelle Obama wasn`t the only big surprise at last night`s Academy
Awards. "New York Magazine`s" David Edelstein recaps the night`s big
night. Stay with us.

(COMMERCIAL BREAK)

SCHULTZ: And in the Big Finish tonight, the Oscars were packed with
song, dance, and a few surprises. Seth MacFarlane hosted the show with
some help from William Shatner.

(BEGIN VIDEO CLIP)

WILLIAM SHATNER, ACTOR: The show is a disaster.

SETH MACFARLANE, COMEDIAN: What -- what are you talking about? It`s
going fine.

SHATNER: No, it`s not.

(END VIDEO CLIP)

SCHULTZ: And there was a bizarre skit in which sock puppets played
pilots in a plane that is about to crash.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: All systems go, captain.

UNIDENTIFIED MALE: OK. Hang on a sec. Glug glug glug, glug glug,
glug glug glug. Let`s do it.

UNIDENTIFIED MALE: Ah, ah, ah!

(END VIDEO CLIP)

SCHULTZ: There wasn`t much singing and dancing. We can`t possibly
give a full recap, but here is a sample.

(BEGIN VIDEO CLIP)

(SINGING)

(END VIDEO CLIP)

SCHULTZ: Then there was the best kept secret of the night, the
surprise guest.

(BEGIN VIDEO CLIP)

JACK NICHOLSON, ACTOR: The First Lady of the United States, Michelle
Obama.

M. OBAMA: I am so honored to help introduce this year`s nominees for
best picture.

NICHOLSON: Do you have your envelope?

M. OBAMA: Not yet, Jack. But I`m about to. And the Oscar goes to
"Argo." Congratulations!

(END VIDEO CLIP)

SCHULTZ: Harvey Weinstein and his daughter initially pitched the idea
for the First Lady to appear in the telecast. The producers loved it and
the First Lady quickly agreed. Producers borrow a Disney jet and made a
secret flight to Washington to hammer out all of the details. One producer
said "the planning of it was like "Argo." It was a CIA mission. It was so
complicated."

Joining me tonight David Edelstein, chief film critic for "New York
Magazine" and contributor for "CBS Sunday Morning." Great to have you with
us.

DAVID EDELSTEIN, "NEW YORK MAGAZINE": Thank you.

SCHULTZ: Thanks for your time again. We had you Friday night. The
boobs song, what did you make of that?

EDELSTEIN: You know, Ed, it would be really easy for me to sit here
and say that Seth MacFarlane stank up the screen. So I`ll just say Seth
MacFarlane stank up the screen and just leave it at that. The whole idea
was it was supposed to be bad. It was supposed to be offensive. They were
being ironic. They were being post modern.

But somehow or other saying that your joke stinks and then delivering
it anyway and being surprised that nobody is laughing at it seems the
ultimate in absurdity.

SCHULTZ: It`s a thankless job. You`re in front of the most talented
people this the world. How do you win doing a job like that?

EDELSTEIN: You know, I`ve liked some of them in the past. I thought
Jon Stewart did a really nice job. Parts of Chris Rock were really good.
There have been some highlights. But the Seth MacFarlane thing, he just
could not -- he was all so sniggery and juvenile. And listen, I love
sniggery and juvenile. I mean, I live for that stuff.

But the writers, this was like really tired third rate material they
were doing.

SCHULTZ: Highlight of the night, Streisand in my opinion. Totally
unexpected. It was that and the Goldfinger.

EDELSTEIN: Babs killed it. Shirley Bassey killed it. Adele killed
it. Actually, I made a list of the things that I liked. Oh, sorry, this
is communists and Harvard Law School. No, I made -- Jennifer Lawrence
tripping on here -- on the stair, adorable, adorable. Oh my God. Shirley
Bassey, Adele, Babs, Ben Affleck when he won, he is fugue staked. The man
actually entered another dimension.

He thanked his wife for putting up with him as a terrible husband.
Then he told the members of the Academy that he was not going to get
revenge on them. Whoever thought he was going to get revenge on them? I
don`t understand.

SCHULTZ: Best picture?

EDELSTEIN: Best picture, we knew it was going to be "Argo." We knew
it was the pity vote. We knew that he didn`t get best director, so -- and
also it glorified Hollywood. It made Hollywood people look heroic.

SCHULTZ: Spielberg didn`t get a lot of love.

EDELSTEIN: A lot of Spielberg hatred. I can`t account for it at all.
I thought he did a beautiful job on "Lincoln." But I thought Ang Lee did a
beautiful job with "Life of Pi" too. Everybody should rush to the heater
to see "Life of Pi" in 3-D, because it really is magical.

SCHULTZ: And the director was somewhat of a surprise, do you think?

EDELSTEIN: Absolutely. Ang Lee is a very charming fellow. Christoph
Waltz was a big surprise. My favorite cute little Nazi, finally in this
movie he -- wonderfully adorable as he splatters slave owners all over the
screen.

SCHULTZ: All right, the First Lady, there have been -- it`s not the
first time a president or a First Lady have appeared in an Oscar. Was this
a hit?

EDELSTEIN: I love Michelle Obama. And I thought this was really a
horrible idea. It just felt wrong. It felt like another universe entering
in there. I mean Oscar -- movies are pretend. This was like -- I don`t
know. All the formality and the guards behind her. And it seemed creepy
to me. And pairing her with Jack Nicholson?

SCHULTZ: That was interesting. Definitely gave him some cover. But
quickly, would it have worked better obviously if she had been there?
Would it have worked if she was there?

EDELSTEIN: I don`t think she should have been there. She doesn`t
belong there. Hollywood has its own royalty. It has its own First Ladies
and first men. That`s what the evening is about.

Oh, Daniel Day Lewis, a God, a God. Absolutely a God. And he was
delightful. He was funnier than Seth MacFarlane.

SCHULTZ: David Edelstein, great to have you with us.

EDELSTEIN: Thank you, Ed. See you next year.

SCHULTZ: Yes, you will. Thank you. That`s THE ED SHOW. I`m Ed
Schultz. "THE RACHEL MADDOW SHOW" starts right now.

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

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