updated 12/19/2014 10:29:55 AM ET 2014-12-19T15:29:55

Show: HARDBALL
Date: December 17, 2014

Guest: Al Cardenas, Charlie Crist, Michelle Bernard, Jonathan Allen

CHRIS MATTHEWS, MSNBC HOST: Our man in Havana.

Let`s play HARDBALL.

Good evening. I`m Chris Matthews in Washington.

Well, today is a moment in American history. Through the Cuban revolution,
through Fidel Castro`s open alliance with the Soviet Union, through the Bay
of Pigs, through the Cuban missile crisis, through all the decades since,
the United States and the regime in Havana are now opening diplomatic
relations. We will have a full-fledged U.S. embassy and an ambassador in
Havana. For those Americans now able to visit Cuba, they can bring home a
good number of that country`s cigars, something whose prohibition has long
been the symbol of the two countries` hostility.

It all happened as part of an exchange of prisoners, especially the release
of Alan Gross, an American, working for the U.S. government, who landed
here in Washington earlier today. The declaration by President Obama at
noon that he, acting within his authority, is opening formal ties between
the two countries is yet another step by this Democratic president --
following his executive order on immigration and his continuing push for a
deal with Iran -- to assert his philosophy before leaving office. It is
hard to imagine a conservative Republican doing anything of the kind.

Here`s President Obama making history.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I`ve instructed Secretary
Kerry to immediately begin discussions with Cuba to reestablish diplomatic
relations that have been severed since January of 1961. Going forward, the
United States will reestablish an embassy in Havana, and high-ranking
officials will visit Cuba.

I`ve instructed Secretary Kerry to review Cuba`s designation as a state
sponsor of terrorism. We are taking steps to increase travel, commerce and
the flow of information to and from Cuba.

I do not expect the changes I`m announcing today to bring about a
transformation of Cuban society overnight, but I am convinced that through
a policy of engagement, we can more effectively stand up for our values and
help the Cuban people help themselves as they move into the 21st century.

I do not believe we can keep doing the same thing for over five decades and
expect a different result.

(END VIDEO CLIP)

MATTHEWS: Well, joining me right now is "The Washington Post" columnist
Eugene Robinson and MSNBC`s Jose Diaz-Balart.

Jose, my colleague, let me start with you. And just without getting into
the passions, which are so strong historically -- and I covered the whole
Elian Gonzalez episode at length, so I know all about the feelings of the
people down there in Little Havana.

If these two days are set apart from all history -- the conversation for 90
minutes between President Obama and Raul Castro, the head of the regime in
Havana, last night, this decision to open formal diplomatic relations, done
by the president by his own authority today, how will this change history
just by these 24 hours?

JOSE DIAZ-BALART, MSNBC "DAILY RUNDOWN" HOST: Well, there`s --

MATTHEWS: (INAUDIBLE)

DIAZ-BALART: -- no doubt about it, Chris. No doubt about it. This is a
monumental change. I mean, the fact is that the United States of America
for more than 54 years has maintained that the Castro regime is not a
regime with which we want to have relations with.

And there are a number of things that have happened, and you listed just
some of them, Chris. But I mean, you know, we can go back to just July of
last year, when a North Korean ship was intercepted in the Panama Canal.
It was heading back to North Korea. And inside, they found sugar coming
from Cuba, but also two MiG jets and 240 metric tons of Cuban-made
armaments, violating the international embargo against arms being sent to
North Korea.

MATTHEWS: Yes.

DIAZ-BALART: That was done by the Castro regime. So we`re talking about a
long history that has not changed inside Cuba. The rest the world has
changed, Chris. The United States had President Eisenhower when they broke
relations with the Castro regime. And those two same brothers that were in
power back then are still in power today. They are frozen in time, where
the rest of the world has changed dramatically.

MATTHEWS: Gene, is this all give on our side? Or what are we going to
get?

EUGENE ROBINSON, "WASHINGTON POST," MSNBC POLITICAL ANALYST: Well --

MATTHEWS: Because somebody in the middle`s going to say -- on the hard
left, they may say "swell," but people in the middle are going to say, Wait
a minute. What`s -- is he going to have elections? Is he going to let the
people out of prison down there, the thousands? What is he going to do?

ROBINSON: Well, one thing, of course, there`s the prisoner swap today,
right, Alan Gross for the three Cuban spies.

MATTHEWS: And the 53.

ROBINSON: But we also -- in addition to Alan Gross, also the U.S.
intelligence asset, apparently a Cuban national, who was very important to
the United States in its intelligence gathering in Cuba.

Beyond that, Cuba is releasing 53 political prisoners. I was looking at --
I don`t know if, Jose, you had a chance to look at them, but I looked at
Raul Castro`s remarks today.

DIAZ-BALART: Yes.

ROBINSON: He spoke at the same time President Obama spoke. And they were
fairly temperate. And it struck me that he -- he said, Well, and we`re
releasing some people in -- some prisoners in whom the United States is
interested.

It was -- it was -- I`ve been to Cuba 10 times, roughly between 2000 and
2004. Every time I went, I thought less of the Castro government and more
of the Cuban people. And so I`m very optimistic today because I think this
is a win for the Cuban people. I don`t think it`s a win for the Cuban
government.

MATTHEWS: Well, here`s an interesting player here, somebody we all
respect. I certainly do, and I think Jose does, too, as well, and Gene.
The breakthrough was worked out with the help of the Vatican, another
amazing by-product of this new pope. Today, it praised -- the Vatican did
-- the outcome. Quote, "The Holy Father wishes to express his warm
congratulations for the historic decision taken by the governments of the
United States and Cuba to establish diplomatic relations with the aim of
overcoming, in the interest of the citizens of both countries, the
difficulties which have marked their recent history."

Well, I`d say difficulties! And look, what is your -- I know you`re a
journalist, like me, and I want to -- Jose, we have to be careful how
deeply we express -- but let me just say as an American, I don`t forget
that he betrayed the revolution, a democratic revolution of the Cuban
people, that they were betrayed. I don`t forget that he betrayed those of
us in the United States who, as kids, rooted like hell for that guy when he
went up and defeated Batista. We thought he was a democrat who believed in
liberal values, and he did not.

Can the people of Cuba who live in this country, who come from Cuba -- do
you think they`ll want anything less than justice for the Cuban -- for the
two Castro brothers? Will they ever have peace of heart with those two
men?

DIAZ-BALART: Chris, we saw in South Africa, there are processes of
reconciliation that can occur after the bitterness of difficult moments
passed. The question is, when will that bitter moment pass? And what will
it take? Because the fact of the matter is that -- and the president, in
this historic step he`s taking today, reestablishing relations with the
Castro regime -- there are some things he cannot do because the American
embargo has been codified into law. As you know, Chris, it was really a
series of executive orders put back to back that later in the `90s were
codified into law. And the end of the embargo is very clear, and it`s
almost so simple that if you read it, you say, OK. And it`s this --

MATTHEWS: What are the 1-2-3`s?

DIAZ-BALART: The 1-2-3 are American embargo will cease to exist when the
Cuban government calls for free and fair elections, that the process of
free and fair elections begins, number one. Number two, that political
prisoners are freed. And number three, that there is freedom of
expression, freedom of labor unions to unite and to create labor unions.

MATTHEWS: OK --

DIAZ-BALART: Those are the three --

(CROSSTALK)

DIAZ-BALART: They`re pretty simple.

MATTHEWS: Well, let me ask you that -- I think we all agree. I think we
all agree. A communist is never going to -- a guy who`s as deeply
committed to communism as the Castro brothers, no matter how old they are,
maybe because they`re so old -- can you imagine them changing their heart
and saying, You know what? I think this country needs free elections. Can
you imagine that, Jose?

DIAZ-BALART: Well, I`ll tell you what. I think they`re -- certainly, the
Castro brothers are more similar to Stalin than they are to Gorbachev, a
Soviet leader --

MATTHEWS: Yes.

DIAZ-BALART: -- that they amply criticized when the change came in the
Soviet Union. There is nothing --

MATTHEWS: So if that`s your standard -- if that`s your standard -- let me
go to Gene on this. If that`s the standard -- free elections, release the
political prisoners and free expression, newspapers, everything else --
nobody`s going to -- they`re communists! They don`t agree to that stuff!

ROBINSON: Right, if that`s --

MATTHEWS: I know I sound like a cold warrior, but it`s a fact.

ROBINSON: -- the standard, I can`t imagine that happening.

MATTHEWS: Yes, so how do we get somewhere in the middle?

(CROSSTALK)

MATTHEWS: How do we move ahead?

ROBINSON: Look, I think you have seen Cuba moving toward a more open
economy --

MATTHEWS: Yes.

ROBINSON: -- although not -- you know, nowhere near --

MATTHEWS: Like the Chinese model.

ROBINSON: -- nowhere near there yet.

MATTHEWS: Yes.

ROBINSON: And what you always heard, what I always heard going in and out
of Cuba, was that Raul Castro thought the China model was a pretty good
idea.

MATTHEWS: Yes, no freedom, just money.

ROBINSON: You know -- exactly. We`ll give you prosperity and you leave
the politics --

MATTHEWS: And keep your mouth shut!

ROBINSON: -- to us and keep us -- right, and keep us in power --

MATTHEWS: Right.

ROBINSON: -- but that -- that Fidel Castro was -- was appalled at what
was happening to China, that people were getting rich and that people --

(CROSSTALK)

ROBINSON: He hated the idea. So here`s -- you know, I`m not aware that
we`ve heard anything from Fidel yet today. We`ve heard from Raul. But
it`ll be interesting to see how far Cuba can go without Fidel.

MATTHEWS: He has to give a little, I think.

Anyway, Alan Gross, of course -- let`s go back to human nature and what we
care about. The American contractor who was held prisoner in Cuba for the
last five years in pretty tough circumstances flew home today and was
greeted by the secretary of John -- Secretary of State John Kerry. He also
spoke over the phone with President Obama.

Well, this afternoon, Mr. Gross talked about his view of the president`s
actions toward Cuba. He is all for this big break, though. Here he is.

(BEGIN VIDEO CLIP)

ALAN GROSS, HELD PRISONER IN CUBA FOR FIVE YEARS: I also feel compelled to
share with you my utmost respect for and fondness of the people of Cuba.
In no way are they responsible for the ordeal to which my family and I have
been subjected. To me, Cubanos, or at least most of them, are incredibly
kind, generous and talented. It pains me to see them treated so unjustly
as a consequence of two governments` mutually belligerent policies. Five-
and-a-half decades of history show us that such belligerence inhibits
better judgment. Two wrongs never make a right.

(END VIDEO CLIP)

MATTHEWS: Let me get to my friend Jose on this. You know, the president,
or somebody said the stale cold war thinking and all that, but you know,
the past is prelude. And as you point out, there`s no indication that the
Castro brothers have changed.

So the past is the present with these folks. So what can they do in a real
sense? Can you imagine it (ph) would say to the Cuban-American community,
which is about split right now politically between the Democrats and the
Republicans on the issue -- it`s a rough split, and probably along
generational lines -- to convince even the older folks. You know, maybe
they are willing to say uncle.

DIAZ-BALART: Well --

MATTHEWS: Uncle. And that`s what you have to sort of say. You know,
communism wasn`t the right move. We were wrong to do this. Will they ever
do that?

DIAZ-BALART: It`s difficult to see the Castro brothers doing that. And
the question is, really, how can you ask people, for example, in south
Florida who have lost a family member to that regime, or people who --
rafters that as we speak today have been risking their lives trying to
leave that island nation to reach freedom in the United States, and maybe
have lost a cousin.

I work with a guy in Telemundo network, my floor manage, who actually got
on a raft 20 years ago and came with his first cousin and his first
cousin`s brother, and he lost them at sea.

It`s very difficult to have that discussion and that conversation with
someone who saw a first cousin being eaten alive by sharks because they had
dreams of living with a future that they saw was not possible in Cuba.

It is about people, in the final analysis, Chris. And I see why Alan Gross
said what he said because he felt (ph) five years of imprisonment in that
island nation. But it`s very difficult to ask people that have experienced
that firsthand to say, Let`s call uncle, on both sides of the equation.

MATTHEWS: Yes. Your heart is as valuable as your mind, Mr. Diaz. Thank
you so much. I really will not forget what you just said. We have to go.

ROBINSON: Oh, OK.

(CROSSTALK)

ROBINSON: No, I was just going on say one thing. The 12 million people on
the island of Cuba -- and you know, my question -- I`ve never been able to
answer it. How does our current policy, or our former policy now -- how is
it helping those people? Those are the people who have to live with this
regime every day. I think this changed --

(CROSSTALK)

MATTHEWS: This is the kind of debate -- this is the kind of debate I want
here. Anyway, thank you.

DIAZ-BALART: Thank you.

MATTHEWS: Jose Diaz-Balart of MSNBC and Eugene Robinson, Pulitzer Prize-
winning columnist for "The Washington Post."

Coming up, we`re going to get into the politics of President Obama`s
historic move today. Already, Jeb Bush says he`s against it, and Marco
Rubio has vowed to do all he can to unravel it. So we see the -- they are
partisan, these lines being taken. We`re going to debate this, whether
it`s a good move by the president or not. That`s coming up. You think
this was hot. It`s going to get hotter.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Well, Senator Marco Rubio of Florida may be running for
president in 2016, and today, he blasted the deal President Obama made to
normalize relations with Cuba. Let`s watch him.

(BEGIN VIDEO CLIP)

SEN. MARCO RUBIO (R), FLORIDA: It is unacceptable that the only people in
this hemisphere that do not know democracy and have not known democracy for
more than five decades is the people of Cuba. That should be our
overriding objective, to do all we can to bring about political democratic
openings in Cuba, and then a free Cuban people can decide whatever economic
model they want.

But the measures taken today will do nothing to bring about that day, and
in fact, I fear will significantly set it back. Today, by conceding to the
oppressors, this president and this administration have let the people of
Cuba down.

(END VIDEO CLIP)

MATTHEWS: More on the politics of the Cuban decision right after this.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. Well, the president`s move to
normalize relations with Cuba today has brought the issue to the forefront
of the 2016 presidential debate, and contenders on both sides have already
taken sides on what is proving to be a hot-button debate.

In her book, "Hard Choices," Hillary Clinton explained why she advocated to
end the embargo while she was secretary of state. Here she is. Quote, "It
wasn`t achieving its goals. We believe that the best way to bring change
to Cuba would be to expose its people to the values, information and
material comforts of the outside world."

Well, former Florida governor Jeb Bush, who took major steps toward a
presidential run just yesterday, came out against the White House move
today, saying, "Cuba`s a dictatorship with a disastrous human rights
record, and now President Obama has rewarded those dictators. We should
instead be fostering efforts that will truly lead to the fair, legitimate
democracy that will ultimately prevail in Cuba."

And earlier this month, Bush outlined his own preconditions for renewed
relations with Cuba.

(BEGIN VIDEO CLIP)

JEB BUSH (R), FMR. FLORIDA GOVERNOR: The United States should only have a
new relationship with Cuba when there is progress on basic human rights for
the Cuban people, including the release of political prisoners, fair and
free elections, the respect of the rule of law, the cessation of
destabilizing countries in the region, and the embrace of a free market
economy. Then and only then should it be lifted!

(APPLAUSE)

(END VIDEO CLIP)

MATTHEWS: In other words, the partisan battle lines have been drawn
clearly.

Joining me now is former Florida governor Charlie Crist, who ran for
governor this year as a Democrat, and Al Cardenas, who was chairman -- who
is (INAUDIBLE) was chairman of the Republican Party in Florida.

Al, I want to start with you, my friend, and I want to know because I know
it -- I want to you spell it out. What`s the opposition about to
normalizing relations with Castro`s regime?

AL CARDENAS, FMR. FLORIDA REPUBLICAN PARTY CHAIR: Well, Chris, I figured
something was afoot. I`m a great admirer of Pope Francis, as you are. And
when he addressed both Raul Castro and the president, I thought something
would happen.

You know, I was there when President Bush signed a law that`s in effect
today, gave me one of the pens of the signature, something I worked for.
And I`ve always been -- I`ve always been praying to do the right thing.

I`m not sure the right thing is what we have now. The goal is to help the
11 million people who`ve lived in suffering and the disdain of that
government for so many years. I`m not sure this thing gets us there. As a
matter of fact, I know it doesn`t. And the ire and the anger of the Cuban
people in Miami, who for so many years have suffered so much, is that they
still don`t believe that that oppression towards the Cuban people has in
any way changed or ended as a result of these unilateral steps.

Yes, U.S. business interests may be helped. Yes, the Castro regime all of
a sudden becomes a citizen in good standing and the world, without having
done anything about it. But the 11 million people in Cuba, it is not
bringing them $500 or $200. They want to smell free air. They don`t want
to be jailed for expressing their opinions. They don`t want that
oppression, that foot of oppression on their necks every day that they wake
up in the morning.

Nothing that was done today will help those people.

MATTHEWS: Let me ask you, Governor Crist, why is there a difference along
party lines here? There are exceptions, like Senator Menendez, who is
Cuban-American, up in New Jersey. But, generally, people are going to the
usual battle stations. Democrats want what looks like a softer line here.
They want normalization.

Republicans tend to want a harder line against the communist government in
Havana. Why do the Democrats, for example, want a softer line, which means
we`re going to negotiate, we`re going to end the trade embargo, we`re going
to have normalization right away?

CHARLIE CRIST (I), FORMER FLORIDA GOVERNOR: Well, I don`t know if it is
all that partisan, Chris. I understand some of the points that you have
made. And I don`t disagree with them, but --

MATTHEWS: Well, isn`t it a partisan -- everybody -- everybody is taking
their usual position. The Democrats are for this thing, Republicans
against it. It really is following that pattern, Governor. You know that.

CRIST: Well, I think what we`re seeing is the fact that the Republican
Party is a much more conservative party even than since the time that Al
Cardenas was chairman of our party in Florida. And I think that more of
that is what you`re seeing voiced today.

You`re not seeing it voiced by Senator Flake from Arizona, as you pointed
out, a Republican who supports what President Obama has done today.

(CROSSTALK)

MATTHEWS: Well, the other party -- of the other party -- is the other part
more anti-communist than you are?

CRIST: No. I don`t think that is the case at all.

Nobody supports communism in the United States of America, at least nobody
who has got their right mind about them. This is about -- this should be a
day that we are celebrating. Al said it very well in his opening comments.
There are 11.2 million people on the Cuban island.

They have been suffering for 50 years under this current policy. Now,
continuing to do the same thing over and over again and expecting a
different result is the definition of insanity. I think enough time has
been devoted to the embargo and to the that way that we have been treating
Cuba.

I think what we need to do is try something new. I applaud President Obama
for having the courage to do so. It is not an easy thing to do, I can
assure you. But it is the right to do. If you`re concerned about the
people on the island, if you`re concerned about their humanitarian rights
and their opportunity to enjoy some of the freedoms that we as American do,
then what I has started today is what Ronald Reagan started with Mikhail
Gorbachev years ago as it related to the Soviet Union.

MATTHEWS: Yes.

CRIST: And look at what has changed. These things start with one step.

(CROSSTALK)

MATTHEWS: Well, one thing that hasn`t changed, Governor, is Gorbachev was
not Stalin. But Castro is Castro

And I want to go back to Al.

It seems to me that my problem with Castro is, I never liked him. He
betrayed your revolution in Cuba. We all as kids thought he was a liberal
democrat. That`s what he said he was when he came in his pajamas up to New
York to the U.N. We were rooting for him against Batista, like a lot of
you folks were in Cuba. And he turned out to be a red. He turned out to
be loyal to the Soviet Union.

He cut his deal with them. He bet on them in the Cold War. If they had
won the Cold War, he would have been there at the firing squad shooting us
all. So, he would have been part of that. I`m sorry. I want to ask you,
Al, will you ever -- should Castro be brought to justice, if there`s any
way to bring them to justice, both those brothers? Is it ever going to
feasible that they`re brought to bar of world justice for they did to the
Cuban people?

CARDENAS: Listen, I live every day when former presidents of this
hemisphere are brought to justice for stealing money.

How are you not going to be brought to justice for killing people? The
former president of Guatemala has just been imprisoned to the United States
because he took a $2 million check from a U.S. phone company. Well, if the
United States has a long arm to reach out to a gentleman like that and put
him in prison for corrupt practice, how do we not put people in prison who
kill thousands of people, Chris?

Where is the sense of justice about that kind of behavior in our
hemisphere? And, furthermore, look, I -- this matter has to go before
Congress, because there are a number of measures he announced that clearly
need a congressional change to the current law. We have codified foreign
policy toward Cuba.

I would like to see during that debate some insistence of what Castro is
actually going to do beyond promising, so that we see what is on the table.
We have always said, in spite of our spite for Fidel Castro, in spite of
the tears that people in my own family have shed for things that happened
to them, we`re willing to do whatever it took to bring Cuba back to the
League of Nations of this hemisphere.

But we ask for only a few things in return for our country opening its
doors, helping Cuba restore itself to its former grandiosity. We only
wanted Castro to do a few things that dealt with people`s human rights.
Open your prisons of political prisoners. Allow freedom of thought. Allow
people to organize politically.

That`s all. We didn`t ask for anything else, other than the basic human
rights that every human being born in this universe is entitled to.

MATTHEWS: OK.

Let me ask you to Governor Crist, what are your concerns or demands that
you want to see before we open up full relations, full economic ties with
Cuba? What do you want? Do you want elections there, for example? Do you
want to removal of all these -- release of all these political prisoners,
thousands of them in prison in Havana?

CRIST: Of course. Of course.

MATTHEWS: What do you want us to do? What do you want them to do as a
deal?

(CROSSTALK)

CRIST: All of us want them to have the same freedoms that we enjoy.

MATTHEWS: As a deal?

CRIST: We want that for all people. That`s what I think everybody wants.

(CROSSTALK)

MATTHEWS: But as a deal. In other words, no free trade with Cuba until
they do that stuff, is that your position?

CRIST: No.

I think we have to take some steps. And I think the president took great
courage to take a big step today. You have to -- in order to move forward,
you have got to have some communication. You have to be willing to talk to
people that maybe you don`t agree with on everything about what we can do
to make life better and the quality of life better for the people on the
island.

That`s what the president did today. It took courage to do it. And I
applaud him for having done so. Now that we have this first step behind
us, as Al pointed out, we need to work with the Congress, we need to work
together to find the points of commonality where we can agree on something
as it relates to this island.

(CROSSTALK)

MATTHEWS: OK. Let me ask you both the same question.

Yes or no, first, do you think the Castro brothers will ever allow truly
free elections in Cuba in their lifetime?

First, Al.

CARDENAS: No.

MATTHEWS: Governor?

CRIST: I hope so.

MATTHEWS: Will they ever allow free elections where they could actually be
thrown out of power and perhaps put in prison when they lose the election?
Because that`s what will probably happen to them. If they lose an election
to democratic forces, they ain`t going to live very long. That`s my hunch.

What do you think?

CRIST: That`s probably the case.

But you always have to hold out hope. I certainly would hope -- and I`m
sure Al does and you do too -- that they would allow for free, open, and
fair elections. That`s what everybody I think wants. We can certainly
agree on that.

MATTHEWS: I just don`t think they are going to change their stripes. I
think they`re commies. I think they`re communists.

CRIST: Well, they are.

MATTHEWS: I think they really believe it, as much as we believe what we
believe. It`s as deep in them as what we believe. And they don`t believe
in freedom or democracy.

I don`t like Castro. I have never liked him, ever since he betrayed people
like me as young Americans who rooted for him.

Thank you, Charlie Crist, Governor. Thank you.

And thank you, Al Cardenas, my friend. Thank you for coming on.

CRIST: Thank you, Chris. Great to see you.

MATTHEWS: Up next, who is behind that massive cyber-hack at Sony Pictures?
The hackers threatened 9/11-style attacks on movie theaters showing the
movie "The Interview" and now Sony is canceling the release of the film.
What is this, successful terrorism? This is horrible stuff and it is
scary. And we will get some answers about that, I hope, in a minute.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL.

Some late-breaking news today on that big Sony hacking case. Two
government officials now tell NBC News that the U.S. government`s
assessment is that North Korea is indeed behind the hack on Sony.
Officials say the hacking attack originated outside North Korea, but they
believe the individuals behind writ acting on orders from the North
Koreans.

The group that has claimed responsibility for the attacks calls itself the
Guardians of Peace. They say the hack was retaliation over the release of
Sony`s comedy "The Interview." That`s the name of the picture which is
about the fictional assassination of North Korea`s leader, Kim Jong-un.

Well, the group threatened a 9/11-style attack on movie theaters around the
country, prompting Sony to actually pull the plug on the movie now. The
film`s release date won`t happen, December 25.

NBC`s Bob Windrem is our investigative reporter.

Bob, these threats, is it the same group, NBC believes, that basically
hacked and then issued this threat, don`t go to the movies and watch this
thing?

BOB WINDREM, NBC INVESTIGATIVE PRODUCER: Well, it seems to be coming from
the same source.

The U.S. government has been using, as one source described to me, the
"most sensitive means" -- quote, unquote -- to determine who was behind
this. And the U.S. government assessment that was made essentially, from
what I can understand, today is that indeed North Korea is behind the
attack.

The question becomes is, who was -- who did they use? Did it originate in
that country, or was it outside that country? And that remains, as far as
we can tell, uncertain. But what is the U.S. government assessment is that
the regime of Kim Jong-un was behind, is responsible for that hack attack.

MATTHEWS: So, they outsourced it. So, that gets to the question of
capability. But what about motive? Is this more anti-Japanese, because
Sony, we keep forgetting -- it is so familiar to us -- is a brand name
coming to us from Japan. Are they anti-Japanese or are they anti-American
or what?

WINDREM: Well, certainly, they`re both.

I mean, I think we know that. And, of course, the North Koreans and the
Japanese have a long history, stretching back 100 years, and very intense.
And I think it is entirely possible that the idea that Sony was behind this
angered them greatly.

The fact that it is being released in the U.S. couldn`t have helped either.
But I do think, at the end of the day, the U.S. is going to have to
determine what to do in response. North Korea was not known as among the
first rank of cyber-warriors. I mean, you have seen in the last few years,
last few years, attacks by Iran and certainly some of the European
countries, China, Europe, have that capability. But North Korea was not on
that short list until now.

MATTHEWS: So this is something we`re going to have to face. And my
question is, why did they get mad at a movie when people have been making
fun at that leader and his father for years now? All over the West, we
think the haircuts, everything about them seems so archaic and weirdly
isolated.

Why do you think a movie bugged them enough to go to this extent?

WINDREM: It may just be the cumulative effect, Chris, that there have been
over the years continual attacks, as you noted, on their leadership.

And it may also have been just an opportunity, that they came across
someone who was willing to do it. Or they went out and tried to find
someone to do it.

MATTHEWS: Yes.

WINDREM: That, we do not know.

MATTHEWS: Wow.

Anyway, thank you, Bob Windrem, for that intelligence.

Up next, torture. Hillary Clinton condemns what the CIA did after 9/11.
But what about Jeb Bush? Will George W. Bush`s decision dog his brother on
the presidential campaign trail?

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MILISSA REHBERGER, MSNBC CORRESPONDENT: I`m Milissa Rehberger. Here`s
what`s happening.

Pakistani authorities have raised the death toll in Tuesday`s school attack
to 148. The country is now observing a three-day mourning period.

New York is moving to ban fracking, a practice used to extract oil and
natural gas, because of health risks.

And after its final meeting of the year, the Federal Reserve said it can be
patient in deciding when to raise interest rates. And that helped sends
stocks soaring, with the Dow rising 288 points, its biggest gain of the
year -- back to HARDBALL.

(BEGIN VIDEO CLIP)

HILLARY RODHAM CLINTON, FORMER U.S. SECRETARY OF STATE: Today, we can say
again in a loud and clear voice that the United States should never condone
or practice torture anywhere in the world, not under any future
administration or in any future conflict.

(APPLAUSE)

(END VIDEO CLIP)

MATTHEWS: Welcome back to HARDBALL.

Last night, Secretary Hillary Clinton was honored at the RFK, Robert F.
Kennedy, Center for Justice and Human Rights gala. At that event, she made
her first public comments on torture since the release of that Senate
torture report just last week.

And she made clear that there should be no ambiguity about U.S. torture
policy.

(BEGIN VIDEO CLIP)

CLINTON: That should be absolutely clear as a matter of both policy and
law, including our international treaty obligations.

And if that requires new legislation, then Congress should work with
President Obama to quickly enact it. Remember what Senator McCain said the
other day. The high standard to which we hold ourselves isn`t about our
enemies. It is about us.

(END VIDEO CLIP)

MATTHEWS: Potential 2016 candidates, including Jeb Bush, will have no
choice but to state a clear policy on torture as the campaigns ramp up.

And joining me now, the HARDBALL roundtable, David Corn, Washington bureau
chief for "Mother Jones" magazine and an MSNBC political analyst, Michelle
Bernard, president of the Bernard Center for Women, and Jonathan Allen,
Washington bureau chief for the Bloomberg News.

Thank you all.

And I guess the question is about Hillary Clinton and this weird role she
is in. She is not a candidate, like pretty much Jeb Bush is now.

You first here.

And yet there`s not a big issue that is going to come by between now and
then, meaning 2016. Well, she`d better get her act together and come out
and say something. Has she said it in time? Has she said it well? And
then we will go over her past positions in a minute.

(LAUGHTER)

MICHELLE BERNARD, FOUNDER, BERNARD CENTER FOR WOMEN, POLITICS AND POLICY:
She is in a difficult spot.

I think it appears that she always feels late on all of the big issues.
She talked about torture one week after everyone was talking about it. She
is talking about the fact that black lives matter and Ferguson and Staten
Island.

MATTHEWS: Was she late on those issues?

BERNARD: And she was late on all of these issues, or at least it feels
late.

I don`t know if there`s ever such -- such a thing as a timely discussion on
-- on torture. But it feels that she is late on everything, and that she is
over-thinking it to make sure she has the right position so that what
happens to her in 2008 doesn`t happen in 2016. And I don`t know if people
really want a candidate that is that safe. They want to know what you
think and what you think right --

MATTHEWS: Jon, do you think she`s too measured? I mean, in others, we
were talking the other day around here about spontaneity and what a power
it is in politics, the ability to go, you know, I don`t agree with that. I
mean, the ability to know who you are always, and be always able to say it,
and not have to consider it or talk to people about what you want to say.

JONATHAN ALLEN, BLOOMBERG: She is hyper cautious. Even the president of
the United States who has to be, he has these rhetorical constraints on
him, because everything he says can be interpreted and can change policy.

MATTHEWS: How does she get a little Biden in her?

(LAUGHTER)

ALLEN: I don`t know what Christmas Parties you`ve been to. The White
House Christmas parties are not like that.

MATTHEWS: You know what I mean, that id, you know, the thing we learned in
psychology, which is the id -- the thing that wants to talk and somebody
says I`d better not say. But that sometime the id helps.

ALLEN: See what she said versus what Obama said. Obama said months ago,
we tortured some folks. She is saying torture should not be the policy.
It should be against the policy and the law of the United States. This is
torture and we shouldn`t do it ever.

And that`s what liberals want to hear.

DAVID CORN, MOTHER JONES: It was a very formalized statement in a very
formal setting. And I think this cautiousness, which was there in the
previous campaigns, certainly was there when she wrote her book about her
years at the State Department. I think it sort of pairs up from her
thinking with perhaps reluctance to be overexposed. Not come out too fast,
too much, because we`re going to have live with Hillary if she runs as a
candidate for almost two years. That`s a lot of time --

MATTHEWS: We know she`s there though.

CORN: You know she`s there, but at the same time, you don`t want to see
her pounce too much. And you`re right. You don`t want to be late.

(CROSSTALK)

CORN: It takes a deft touch. But so far, she hasn`t --

MATTHEWS: How do you learn to play baseball? How do you learn to box or
anything? How do you learn to type? You learn how to do it by doing it.
How can she learn how to be a candidate by not being a candidate? By not
acting like one?

(CROSSTALK)

BERNARD: Before you can get to the candidate questions, you raised an
excellent point that I think is going to plague her going forward.

(CROSSTALK)

BERNARD: Happy birthday.

(LAUGHTER)

BERNARD: We talked about that. You raised an excellent point when you
said who is she? We want to know who she is.

Here`s one of the things that I think will plague her going forward in
2016. Maybe Hillary Clinton is the person that sort of ebbs and flows with
whatever she thinks the populace is. I think one of the things that will
come back to haunt her, for example, is if you go back to the discussion we
had a few months ago about Hillary Clinton and her defense of a rapist, or
an alleged rapist in Arkansas years ago.

CORN: Oh, no, no, no.

BERNARD: I got to bring it up. No, no, listen.

CORN: I`ve listened to that tape. I think this is --

BERNARD: You don`t know what I`m going to say, David. Let me say my
point.

CORN: Go ahead, I don`t.

BERNARD: My point is that Hillary Clinton had a deep Southern accent. She
seemed completely different than the Hillary Clinton of today, and people
will ask, who is the real Hillary Clinton?

ALLEN: Aren`t you different than you were 30 years ago?

BRENNAN: Well, I still sound the same.

MATTHEWS: How many accents do you have?

ALLEN: Well, it depends on where I am.

MATTHEWS: Oh, really?

OK. Let`s go back to the substance, away from style. We`ll get back to
that in a couple of hours.

Anyway, let`s talk about what she said before. Let`s look at what she said
back in, say, 2006 right now. And this was --

(BEGIN VIDEO CLIP)

TIM RUSSERT, MODERATOR: Senator Clinton, this is the number three man in
al Qaeda. We know there`s a bomb about to go off and we have three days
and we know this guy knows where it is. Should there be a presidential
exception to allow torture in that kind of situation?

SEN. HILLARY CLINTON (D-NY), THEN-PRESIDENTIAL CANDIDATE: You know, Tim, I
agree with what Joe and Barack have said. As a matter of policy, it cannot
be American policy, period.

(END VIDEO CLIP)

MATTHEWS: Well, Hillary Clinton has been a staunch opponent of torture
you. But in 2006 ed board meeting with "The New York Daily News", this is
a year before that tape, she allowed for the extreme ticking time-bomb
scenario, one where you got a terrorist captured and you don`t have time
for an interrogation that does not involve torture. And she said then, "I
have said that those situations are very rare, but if they occur, there has
to be some lawful authority for pursuing that. In those instances where we
have sufficient basis to believe that there is something imminent, yes, but
then we`ve got to have a check and balance."

Well, that`s sort of opening up the idea of -- I will go find some legal
authority. The problem with that is you`re letting someone else decide
whether you should be allowed to do it.

CORN: Whoa, whoa --

MATTHEWS: And that means you can do it -- look, what W.`s administration
did. They went to Yoo, or somebody in their own office that they
appointed, right?

CORN: Well, the bottom line is the ticking time scenario is a canard. You
talk to experts in --

MATTHEWS: Well, she brought it up.

CORN: She brought it up, because why? She wanted to sound a little bit
hawkish.

MATTHEWS: Because she was talking to "The New York Daily News".

CORN: Yes. And what she did for years on the Iraq war position, where she
kind of defended but not defended. It took her eight, 10 years to finally
say, I was wrong.

This goes back to what you were talking. Politicians tend not to admit
they`re wrong and they -- a lot of them like to have it both ways. But you
have to find an authentic way of doing that, and she doesn`t.

BERNARD: Well, I got to tell you -- I think that Hillary Clinton in 2006
was the real Hillary Clinton. I don`t see a problem. I don`t think she
will have a problem with that.

All of them evolve eventually on various issues.

ALLEN: I don`t know that it has changed. She doesn`t want to could not
strain herself if she`s president, which makes it really hard to run a
presidential campaign when you`re thinking.

MATTHEWS: Do you know what I think, and I may sound really tough like
this, but I think when it comes to that crunch, the rules are there.

BERNARD: Exactly.

MATTHEWS: And they will be used or not. But the president has a
responsibility not for following the rules, but in the end, if it comes to
this country facing something like an existential threat, the president
will do what he or she really believes should be done. That`s just a fact.
Anyway, it`s a fact of life. You do it with your kids.

Anyway, the roundtable is staying with us.

And up next, President Obama addresses race relations in this country. Our
new poll shows people feel things are as bad as it has been in 20 years.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Well, it`s official. The Republicans have won the final
outstanding House race of the year. Republican challenger Martha McSally
defeated incumbent Democrat Ron Barber in Arizona. That`s the district
formerly held by Gabby Giffords. McSally won by just 167 votes at a race
that went to a recount. Boy, that`s close. That means the Republicans now
control the House with 247 seats in the new Congress, their largest
majority since the Hoover era of the early `30s.

And we`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: Well, we are back.

And according to a new NBC/"Wall Street Journal" poll, race relations are
the worst they`ve been in the United States in almost two decades. Well,
that`s terrible news. Not since O.J. Simpson was acquitted in October of
1995 have race relations been so bad.

The NBC/"Wall Street Journal" poll at that time revealed that 61 percent of
Americans said that relations between the races were bad. According to a
new poll, 57 percent of Americans say race relations are bad. Well, that
increasingly pessimistic view comes in the wake of protests over the deaths
of unarmed black men at the hands of police.

Back now with the roundtable talking about that, David, Michelle and
Jonathan.

I know you`ve been very passionate about this, Michelle, as a mother of a
couple boys.

BERNARD: No, a boy and a girl.

MATTHEWS: Boy and a girl. You know about the feelings. You have them.

BERNARD: Yes, you can`t help but have them. I saw a drama on NBC where a
female president who`s African-American, her son was killed, and she said
to one of the characters in the program, this war is going to make all of
us killers. And she was talking about women.

And I think a lot of African-American, American women in particular feel
that way because we are watching what feels to us like a battle that is
being waged. People are talking about Castro and human rights violations
in Cuba. We`re living in some of the greatest --

MATTHEWS: Let`s talk about --

BERNARD: -- human rights violence against African-Americans in this
country today.

MATTHEWS: I would call you an intellectual.

BERNARD: Yes.

MATTHEWS: So, when you think intellectually about your kids, how they
would get into a police situation. How would you see it escalating? Like
the guy who was selling loosies. Now, he was a street guy, he wasn`t some
kid that goes to college or anything.

But how did that escalate? Because for some reason, he didn`t want to get
arrested. So, all of a sudden, they`re treating him like he`s a criminal,
like he`s a real felon, right? That was weird. Cops escalated that, I
would argue.

But Michael Brown, a guy who had been involved in a crime, maybe it`s not
the worst crime in history, but it`s a crime of larceny, and in this case,
what would you think would happen? What do you think in your blind side
when you think of your young son getting involved with the police and
ending up tragically? How does it happen?

BERNARD: Kids -- all children, white and black, do stupid things. It just
happens. If you`re a black male, all it takes to escalate is being a black
male and doing the stupid thing that your friends, for example, in college
could do, go to a toga party, go get drunk, go have a beer and back lip a
cop. Your son would not get killed. Mine might.

MATTHEWS: Yes.

BERNARD: All it takes to escalate --

MATTHEWS: So, you actually see it through your eyes. You can see it
happening?

BERNARD: Absolutely. Absolutely.

MATTHEWS: I think what I`ve learned, I`m going to end of this, when I say
things are getting better, I mean, I`m feeling better.

But then I watch the black community react, especially in Ferguson, which
isn`t going away. And I said, that degree of passion and anger is not
going away. And how come I didn`t know about that?

And when I`m asked how things are going, I answer as a white person. I
think they`re getting better because I don`t feel anything bad. I feel
day-to-day relations with people you bump into, all seem on one to one look
good.

BERNARD: And we have a black president.

(CROSSTALK)

MATTHEWS: I was ecstatic at --

BERNARD: So did I.

MATTHEWS: Jesse Jackson was crying. I mean, you know --

CORN: I find with my two teenaged girls, they have friends of all
different ethnic backgrounds, and races and religions.

MATTHEWS: That`s the norm now.

CORN: They didn`t even talk about it. When I did that as a kid, we noted
that.

But to me the profound divide that people have in perspective where people
have in the community Michelle are talking about really feel a war, and
people like you say, hey, I don`t see a problem, you know --

MATTHEWS: Until I saw one.

CORN: Until you saw one. It really shows that this country has its
underlying division that is not going to be easily dealt with I think in
the coming future with just a few policy changes or indictments.

MATTHEWS: We`ve got to go.

ALLEN: Be easier to put 57 percent of people think there`s a race problem.
The other 43 percent have no idea what they`re talking about.

CORN: Yes.

MATTHEWS: OK. Thank you.

A lot of that`s class, kids go to private, public school, they get in
different environments, others don`t.

BERNARD: And they interact with one another.

MATTHEWS: Thank you, David Corn. And thank you, Michelle, as always --
Michelle Bernard and Jonathan Allen.

When we return, let me finish with what we`re just talking about, about the
way white people and black people think about race and it`s different and
it`s disturbing.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Let me finish tonight with what we were just talking about, the
way that white people and black people think about race.

I think whites tend to let the subject drop once in a while. I mean, they
don`t even think about how things are going in this country between the two
groups. They think of whatever else is worrying them, what is grabbing
their interest like how to pay the bill and what to do when you get a
little time off.

I`ve learned that African-Americans don`t have that luxury, that mental
ability to simply drop the subject. They have to deal with the matter
whether it`s the way white people look at them, act around them, speak with
them. They get vibes, they get outright behavior that says things are not
great between us even if the white person doesn`t admit to sending those
signals, doesn`t even -- this is giving people a break -- believe they`re
sending them.

A white person doesn`t have to think about the difficulty of getting a cab
or more seriously certainly, how their young sons will be treated in a
vulnerable situation involving the police. They don`t have to worry about
a small incident escalating into something horrible.

Well, think of the way black people and white people responded when they
first got the news flash of the O.J. Simpson verdict. Personally, I was
stunned. I thought two hours of deliberation meant that the jury found him
guilty. How could they not, I thought, with all the blood over the place?
All the trying to escape in the white bronco with the passport to the
skies? Why would a guy, a celebrity, a beloved celebrity, that go racing
for the border when his wife is killed?

Well, recent incidents have left a bit more prepared. While I wasn`t ready
for the strong outpouring of anger over the Michael Brown tragedy, I
certainly was for the Eric Garner killing. I saw in that video all they
need to see, that there needed to be more than a grand jury, there needed
to be the real one, the kind you get after there`s a trial.

So, as we, white and black, continue along this line of tragedy and race
relations, I believe the whites among us will learn not just from their own
reaction of horrible events but from the other communities reaction. And
when we are asked how things are going, we`ll have already begun to learn
to judge progress not just by our own lights but by the lights of others.
I`ve come to the conclusion that there is no way to say things are good
when so many say they are not. There are just too many of those other
people I`ve come to personally respect.

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

"ALL IN WITH CHRIS HAYES" starts right now.


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

Copyright 2014 CQ-Roll Call, Inc. All materials herein are protected by
United States copyright law and may not be reproduced, distributed,
transmitted, displayed, published or broadcast without the prior written
permission of CQ-Roll Call. You may not alter or remove any trademark,
copyright or other notice from copies of the content.>