updated 8/2/2005 11:37:43 AM ET 2005-08-02T15:37:43

Guest: John Harwood, Jim VandeHei, Craig Unger, Peter Schmuck

ALISON STEWART, HOST:  Can you imagine your first day on the job, you arrive at your new employer, and you‘re welcomed with boos?  That is exactly what happened to John Bolton after the president sidestepped Congress and made him the new U.S. ambassador to the United Nations.

Things can only look up from here, right?Which of these stories will you be talking about tomorrow?

President Bush gets his way.  Mr. Bolton goes to the U.N.  But will the U.N. put out the welcome mat for this appointed ambassador?  The politics, the posturing, and put-that-in-your-hat to Congress.  We will discuss.

Mission Control, we have another problem.  A discovery on “Discovery.” 

The astronauts‘ new high-risk mission to deal this tiny little white dot.

Three thousand hits, over 500 home runs, and one memorable denial.

(BEGIN VIDEO CLIP)

RAFAEL PALMEIRO:  I have never used steroids, period.

(END VIDEO CLIP)

STEWART:  Major league baseball begs to differ.  Rafael Palmeiro suspended today for steroid use.

And the flightless waterfowl waddling into America‘s hearts and wallets, the summer phenomenon that is the March of the Penguins.

All that and more, now on COUNTDOWN.

And good evening to you.  I‘m Alison Stewart, in for Keith Olbermann.

So he got the job without Senate confirmation, so the White House didn‘t have to release all of those pertinent documents, so he is guaranteed a high-level post for at least the next 17 months.

It‘s still not easy being John Bolton.  Imagine finally getting this job that you‘re waiting for, after enduring accusations of stapler throwing, calling hallway chasing, all on national television, only to show up at your new job, and get booed upon arrival.

Now, on the plus side for Ambassador Bolton, he is our fifth story on the countdown.

Sticks and stone may break his bones.  It‘s safe to say that Ambassador Bolton did not want the post in order to make some new friends.  It‘s a pretty short gig, 17 months and out.  Let‘s face it.  The man has all the friends he needs—the president, Madam Secretary, standing by their man, never dropping the nomination when things got rough.

President Bush used a legislative loophole to give Bolton the job this morning, as soon as the Senate split town.

No love lost between the commander in chief and those pesky Democrats.

(BEGIN VIDEO CLIPS)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  The United States Senate held thorough confirmation hearings, and a majority of United States senators agree that he is the right man for the job.  Yet because of partisan delaying tactics by a handful of senators, John was unfairly denied the up-or-down vote that he deserves.

JOHN BOLTON, U.N. AMBASSADOR:  We seek a stronger, more effective organization, true to the ideals of its founders and agile enough to act in the 21st century.  It will be a distinct privilege to be an advocate for America‘s values and interests at the U.N.  And in the words of the U.N.  charter, to help maintain international piece and security.

My deepest thanks to you both for the opportunity to continue to serve America.

(END VIDEO CLIPS)

STEWART:  The man in charge at the U.N., Secretary General Kofi Annan, showed his diplomat skills today, saying he‘s looking forward to working with Ambassador Bolton, sort of.  More on that in a moment.

Reactions all over the place today.  Most Republicans glad their side won and that it‘s finally over, but not GOP Senator George Voinovich of Ohio.  He was the most vocal Bolton skeptic during the confirmation process, and today he was offering Ambassador Bolton etiquette advice in a statement.  Quote, “I plan to send Mr. Bolton a book that has served me very well throughout my career called ‘The Heart and Soul of Effective Management‘ by James F. Hind.  I hope that Mr. Bolton will read it and put it into practice,” end quote.

All righty, then.

Compared to that, the Democrats were kind.

(BEGIN VIDEO CLIPS)

SEN. BARACK OBAMA (D), ILLINOIS:  But now he‘s going in for what we know is only going to be a short-term appointment.  And that, I think, makes him weaker, it gives the United States less leverage to carry out some of the significant reforms that need to take place.

SEN. CHRISTOPHER DODD (D), CONNECTICUT:  We need someone there.  I don‘t disagree with that.  And there are plenty of good, strong conservatives who are blunt, who would advance the reform agenda, as well as handle these other complicated issues very well.  Mr. Bolton‘s not that person.

KOFI ANNAN, U.N. SECRETARY GENERAL:  And we look forward to working with him, as I do with the other 190 ambassadors.  It is the president‘s prerogative, and the president has decided to appoint him through this process, for him to come and represent him, and from where I stand, we will work with him as the ambassador presented by the president and government.

(END VIDEO CLIPS)

STEWART:  Well, love him or not love him so much, John Bolton rarely, if ever, inspires ambivalish, and gosh darn it, that‘s the way the COUNTDOWN staff likes it.

“Wall Street Journal” national political editor John Harwood is our chief Boltonologist tonight.

Hi, John.

JOHN HARWOOD, NATIONAL POLITICAL EDITOR, “THE WALL STREET JOURNAL”:  Hey, Alison, how are you?

STEWART:  I‘m doing well.  Hey, let‘s talk about what happened today. 

Can you explain this whole recess appointment thing for us?

HARWOOD:  Well, the president has the power under the Constitution to send people to jobs temporarily when Congress goes out of session.  It is not all that uncommon.  President Bush has done it 105 times before John Bolton.  President Clinton did it plenty, and so did his predecessors.  And this was the inevitable outcome once Senate Democrats blocked this nomination from moving forward.

STEWART:  Why do you say it‘s inevitable?

HARWOOD:  Well, Democrats knew that President Bush, after going toe to toe with them on this, wasn‘t going to simply, you know, put his tail between his legs and walk away.  They were expecting this.  They feel like they got a pretty good outcome here, which is that John Bolton got the job, which the president has the power to give him, but in a weakened state that will make it more difficult for him to carry out his agenda.  And Democrats don‘t like that agenda.

STEWART:  And had you been asked, if they said, Hey, John, advise us on this, if you had to tell the president why it was a good idea to do this recess appointment, what would you have said why it was a good idea?  And if you had to tell him, Mr. President, this one‘s a stinker, why would you have told him that?

HARWOOD:  Well, I‘m nobody to give advice to the president, but I‘d say the positive thing for the president in this is that he gets his man.  It‘s a bit, Alison, of a metaphor for the president‘s second term.  There‘s some fatigue with his policies, and Democrats use their power to showcase that.  And there‘s a lack of enthusiasm, Alison, among Republicans too.  They didn‘t, by and large, didn‘t really like this appointment all that much.

But at the end of the day, the president, even though he‘s a lame duck, he won the election, he‘s got the power to make this happen, and now he can go to the world and say, I‘m pursuing my agenda at the U.N., even if he doesn‘t end up getting all that he wants.

STEWART:  And of course, Mr. Bolton has this job for 17 months.  So does this mean we‘re going to have to go through this all over again in January ‘07?

HARWOOD:  That‘s likely, unless President—unless Ambassador Bolton does such a good job the Democrats decide that they have a different opinion about him, and some Republicans too.  But I‘ll tell you one thing, Alison, I wouldn‘t—if I were Senator Voinovich, I wouldn‘t count on John Bolton reading that book I sent him.

STEWART:  And finally, you know, many different people from all kinds of affiliations believe the U.N. needs some sort of reform.  Bolton said he‘s the man who can do it.  The president has said this is the man he can do it.  Gauge for us the difficulty of this task.

HARWOOD:  Well, I think you‘ve got some indication of that in the boos that you heard around the table, and that politely cool reception that Kofi Annan gave, said, Come join us at the table with 189 other ambassadors.

Now the United States is the biggest fish in the U.N. pond, if you will.  We provide the most money.  But the question, you know, there are a couple of things on the table.  What do you do about the Security Council?  How do you expand that?  Japan, Germany want permanent seats on the council.  And there‘s also questions about how they spend their money, independent auditing boards and all that.

So there‘s a whole lot of issues on the table.  John Bolton will have some ability to move things forward, but not as much as the president would like.

STEWART:  John Harwood, many thanks to you, as always.

HARWOOD:  You bet.

STEWART:  From one political hot potato to another, the CIA leak investigation.  Since this whole shebang began, columnist Robert Novak has been virtually mum on the matter.  It was his July 2003 column that outed Valerie Plame as a CIA operative.  But now Novak has come to his own defense, after recent revelations that he was warned not to use her name in his column.

A report last week in “The Washington Post” said that former CIA  spokesman Bill Harlow warned Novak in the strongest terms not to identify the wife of former ambassador Joe Wilson.  Harlow even called Novak back a second time to repeat the warning, once he had confirmed for himself that Plame was an undercover operative.

Novak‘s response, today‘s column, which also ran in the op-ed section

of “The Post,” quote, “That is meaningless.  Once it was determined that

Wilson‘s wife suggested the mission, she could be identified as ‘Valerie

Plame‘ by reading her husband‘s entry in ‘Who‘s Who in America.‘”

Novak also says he never would have written about Plame if anyone from the CIA had told him that doing so would endanger her or anyone else.  He offered a similar defense in a column way back in October 2003.

Earlier this evening, I spoke with co-author of the report that got Robert Novak so fired up.  That would be Jim VandeHei, the White House correspondent for “The Washington Post.”

Jim, always good to talk to you.

JIM VANDEHEI, WHITE HOUSE CORRESPONDENT, “THE WASHINGTON POST”:  Good to be here.  How you doing?

STEWART:  I‘m doing well.  Let‘s get to Novak‘s bold assertion first that two warnings from a CIA official were meaningless, because anyone could go to “Who‘s Who” and find out who was the wife of Joe Wilson.  So why or why doesn‘t that get Novak off the hook?

VANDEHEI:  Well, first off, Novak isn‘t in any legal trouble.  I think what we‘re getting here at is, should he have ever disclosed her name in print, which he did?

And the dispute here is between Novak and Bill Harlow, who used to be the spokesman for the CIA.  And he says, Harlow told us that in very strong terms that he told Novak, Do not print her name.  Now, Harlow could not say that, I would be outing a covert operative, because then he himself would be doing that.  But he said in as stronger terms as he possibly could, he waved Novak off from writing that name.

STEWART:  So we‘ve got a case of he said-he said here.

VANDEHEI:  Right.  And basically what we are looking at is, what did each man tell the grand jury in this investigation?  Because I think that will help the prosecutor get to the heart at who actually leaked this name.

STEWART:  Harlow told Novak that Valerie Plame did not authorize the trip to Niger by Ambassador Joe Wilson.  But in his column today, Novak says, quote, “This gave the impression I ignored a official statement that I had the facts wrong.”  So does this come down to whom you choose to believe?

VANDEHEI:  Right, well, there‘s two accounts out there.  There‘s one, the Senate Intelligence Committee did come out with a report that said that Valerie did play a pretty big role in authorizing her husband‘s mission to Niger.  The CIA officials have told us is that there was some confusion about testimony given to the Intelligence Committee, because three years earlier, she had actually authorized a mission for her husband to Niger, and the CIA officials are telling us they think some of those facts might have been confused and left a false impression.

STEWART:  Now, based on his columns, do you get any sense on how heavily Novak relied on his own sources within the Bush administration?

VANDEHEI:  Yes, I have no idea who that second source is.  It has become clear in the last couple of months that he did talk with Karl Rove and that they, at least that Karl Rove had mentioned that he had heard about Valerie Plame and had heard about that she had worked for the CIA and played some role in his mission.  We don‘t know who that second source is.  And what we‘re pretty sure that that‘s one of the things that Fitzgerald, who‘s the special prosecutor in this case, is trying to determine.

STEWART:  And just a quick line in his column he wrote that caught my eye.  He said, he just tossed it off as an obscure case.  Do you think it is?

VANDEHEI:  I have no idea.  (INAUDIBLE), as far as this whole case, we don‘t know where the prosecutor‘s going.  The prosecutor went in looking at this crime of outing a CIA operative, and whether someone knowingly did that.  In the course of investigation, he‘s talked to several people in the administration, in the White House, the CIA, National Security Council, and a lot of people in the case believe he‘s also taking a look at whether there was any contradictory testimony given to the prosecutors.

STEWART:  So it is still to be determined, I guess.

VANDEHEI:  Right.

STEWART:  Jim VandeHei of “the Washington Post,” thanks so much for weighing in with us.

VANDEHEI:  Take care.  Have a nice night.

STEWART:  It will be no walk in the park as NASA greenlights a third spacewalk to fix a critical problem with the thermal tiles.  We‘ll go live to Mission Control to assess what is at stake.

And what‘s at stake in major league baseball after today‘s headline, “The Orioles‘ Rafael Palmeiro Suspended for Steroids”?  After adamantly telling Congress he never touched the stuff.

You‘re watching COUNTDOWN on MSNBC.

(COMMERCIAL BREAK)

STEWART:  Practice makes perfect.  But now “Discovery” has a problem, and no chance to really take a test spin.  The latest, an issue with the shuttle‘s heat shield led officials to announce this evening that they will go forward with an unrehearsed space walk to repair the ship‘s underbelly on Wednesday morning.

Our number two story on the COUNTDOWN, making a fix to the exterior of the shuttle while in orbit is something that‘s never been done before.  But this evening, NASA decided it was necessary, despite the risks.

The call was made after extreme closeups of “Discovery”‘s nose revealed two pieces of gap filler protruding between tiles near the nose.  The fear that upon reentry the small felt-like pieces could drag superheated air down the belly of the shuttle, creating a blowtorch-like effect aimed at one or more of the tiles.

Engineers on the ground spent the day rehearsing techniques for removing the fillers.

For more on how this will all work, and what could be a problem, we‘re joined now from the Johnson Space Center in Houston by James Oberg, a former space shuttle Mission Control engineer.  Spent more than two decades at NASA, and he spends a good bit of time helping us on COUNTDOWN.

Nice to talk to you, Mr. Oberg.

JAMES OBERG, MSNBC SPACE ANALYST:  Well, hello again, Alison.

STEWART:  OK, this flap of material, this gap filler, how risky is this mission going to be to work on this?

OBERG:  It‘s always a matter of tradeoff of risk.  And this is how the managers explain it today.  The risk for the gap-filler material sticking out into the airflow is basically, they can‘t calculate it, because it‘s too high of a speed.  They don‘t have enough data.

In the past, it had some cases where they‘ve seen scorching and extra heating downstream.  They don‘t know for sure that this is safe.  And that means, if you don‘t know it‘s safe, do what you can to make it safe.

On the other hand, they know about spacewalks.  They‘ve done lots of them, and two already on this mission.  And they can—they‘ve already thought about what it would take to get down under the belly, the front of the shuttle, underneath there, out of sight of the other shuttle crew members, but within sight of a lot of TV cameras, and work on this area close to the very fragile tiles you don‘t want to break.

John Young, the famous astronaut who walked on the moon and flew many shuttle missions, said that there‘s no problem in space, there‘s no problem in space that you can‘t make worse.

And so the engineers here are well aware that they could make this worse by hitting a tile, cracking it, so forth.  They‘re looking at making sure they don‘t do that.  They will be studying and practicing, and they‘ll do the spacewalk, which is already planned with other—for other things, on Wednesday.  They may delay it a day to spend more time practicing and studying.  And we‘ll know that by tomorrow.

STEWART:  It was interesting, in that press conference, they said it was an easy decision.  Why do you think it was easy decision?

OBERG:  It was an easy decision because of unknown risk versus known risk.  It was unknown risk of what this gap filler could do.  This material really looks just like a card, a thick notecard.  It‘s cloth soaked in silicone material that goes between tiles, about six inches (INAUDIBLE) is length like this, piece of it sticking up.

The plan would be for the astronaut Steve Robinson to come up close to it on a platform run by the space station‘s robot arm, not the shuttle‘s, but the space station‘s robot arm, and reach over with the very best tool that we‘ve ever sent into space, a hand, a human hand, grab this, and pull it loose.  If you can‘t tug it loose, the next idea is hold onto it with forceps and saw it with a saw blade he‘s going to carry with him.

If that doesn‘t work, try some industrial-strength scissors, which he also will have.  If that doesn‘t work, come back inside, take a day, and replan it.

We expect it will pull out, and it will then eliminate the unknown risk of having this sticking up in the airflow, causing this extra heating.  The known risks are pretty well matched and for the spacewalk.

STEWART:  I know I can always count on you for a good prop.

Something that is—I‘ve really been struck by this whole mission is, on Saturday, they were caulking.  You just described industrial scissors and a hand saw.  It seems like it‘s almost like house repair work they‘re doing up there.

OBERG:  It‘s house repair combined with airliner repair, compare with submarine repair, and a little bit of human body repair.  They have—if they need something else to cut it with, they can bring out not just dental floss, but these little metal saw, the wire saws that sometimes people use.  They‘re all there.

STEWART:  James Oberg, former Mission Control operator, now MSNBC space analyst, great to talk to you.

OBERG:  Good, Alison.  We‘ll see you again, I‘m sure.

STEWART:  We will.

(audio interrupt) jobs, earthly cars that should have never been on the road, but they are really fun to crash.

Oddball‘s ahead.

And Burt Reynolds walked down the aisle and heads to divorce court several times.  Now he says his life would have been different if he‘d met the right man, Mr. Willie Nelson.

(COMMERCIAL BREAK)

STEWART:  I‘m Alison Stewart, COUNTDOWN‘s captainess in command while Keith Olbermann vacations this week.

We travel now to the uncharted waters of strange news, cool video, and weird people doing stupid things.

Let‘s play Oddball.

We begin in Mildenhall, England, that‘s Mildenhall, for one of Oddball‘s favorite motor sports events of the year, the three-wheeled Reliant race, held each year since the cars were in production in the ‘60s.  The race is hugely popular, with thousands turning out to watch those goofy cars roll.

At one time, the English-made Reliant was the best-selling car in the country.  Then they must have figured out that they don‘t really do so well on those turns.  But it makes for a really good smash racing.  Twenty-five-year-old gravedigger Sam Begley (ph) took the checkered flag in the rain yesterday to become the first repeat winner in the history of the race.

Then he went home and buried the car.

To Australia, where they are wrecking stuff on a far grander scale.  This is the Aussie warship the H.M.A.S. “Brisbane,” getting all blowed up to become an artificial reef off the coast of Queensland.  Good for divers, good for fish, and good for Oddball, because they had cameras on board as the 36 explosives scuttled the ship.  As the “Brisbane” sank, we treated our—we were treated to our first eye view of a sinking ship.  Kind of like “Titanic” without that mind-numbing Celine Dion song.

Finally, to Aud (ph), France, where a drunk-driving campaign might be a tres bien idea, considering there are people standing in traffic handing out bottle of wine to the drivers.  More than 400,000 bottles are being given away in the south of France as local winemakers attempt to raise awareness of the growing crisis in the industry.

They can‘t sell the stuff, but they‘re hoping to kickstart sales with an open-bar adage that free booze is better than good booze.  You can save me a nice Sunsier (ph) if you‘ve got it.

London braces for a possible third wave of attacks in what will happen to the larger war on terror after the death of Saudi‘s King Fahd.

And what to do to escape all the serious news?  For some, the answer, penguins and on the march, and making waves at the box office.

Those stories ahead.

But first, here are COUNTDOWN‘s top three newsmakers of this day.

Number three, the residents of Tallahassee, Florida, who went along with their lives without skipping a beat last week despite a region-wide radiation alert.  Turns out someone at the National Weather Service, meaning to do the routine weekly test of the Emergency Broadcast System, accidentally entered the code for a radiological hazard in the area.

Apparently, nobody seemed to notice, proving once and for all that no one pays attention to those things.

Number two, the unidentified Taiwanese man who lost his dentures in 2002.  This week, he visited a doctor complaining of minor breathing trouble.  The surgeon discovered the source of the man‘s problem were his missing choppers, stuck in his throat, where they‘d been for the last three years.  I hate it when that happens.

And number one, Ednor Rodriguez of Sao Paolo, Brazil, he has no teeth either, not a one.  But for some reason, he was caught on a security video shoplifting seven toothbrushes from a supermarket.  After he was arrested, he admitted to the crime, and said to the police, quote, “I have no teeth.  What was I thinking?”

Fine question, but we‘re guessing Ednor rarely does a whole lot of thinking.

(COMMERCIAL BREAK)

STEWART:  Nine more terror arrests in Britain, yet it‘s not enough to dispel persistent rumors that another terror cell is on the verge of bombing London once again.  Our third story on the COUNTDOWN: the possibility of a third attack and a new link between the bombers, Pakistan and possibly even Saudi Arabia.  NBC‘s chief investigative correspondent, Lisa Myers, is in London, monitoring the latest developments—Lisa.

LISA MYERS, NBC CORRESPONDENT:  Alison, Western counterterrorism officials tell NBC News that authorities now think the apparent leader of the July 21 bombers traveled to Pakistan late last year.

(BEGIN VIDEOTAPE)

(voice-over):  Muktar Said Ibrahim obtained a British passport last fall.  Officials say in December, he traveled from Britain to Saudi Arabia, then on to Pakistan.

UNIDENTIFIED MALE:  It raises the possibility that they were involved with Pakistani jihadists and possibly even with al Qaeda itself.

MYERS:  That would put Ibrahim in Pakistan at the same time as two members of the July 7 bombers, seen here arriving in Karachi last November.  Today in London, massive security triggered by what authorities say is intelligence suggesting a third cell of bombers may be ready to strike.

There‘s conflicting intelligence about the nationalities of these individuals.  One of the July 21 bombers, Hussain Osman, was charged in Rome today.  His lawyer claims he‘s not a terrorist.

ANTONIETTA SONNESSA, Hussain OSMAN‘S LAWYER (through translator):  The explosive used was not deadly.  He didn‘t know exactly what was inside the bag.

MYERS:  So how did Osman escape Britain amid its largest manhunt ever?  Italian and British officials say last Tuesday, five days after the bombing, he boarded a train at this station in the heart of London.  They tracked his cell phone calls through Paris, Milan, Bologna and finally Rome, where he was arrested Friday.

(END VIDEOTAPE)

Tonight, investigators have clear evidence tying the July 7 bombers to Pakistan.  They‘re now trying to determine the extent of the other bombers‘ Pakistani connection—Alison.

STEWART:  Lisa Myers reporting from London for us tonight.

That‘s the Pakistan connection.  Now the Saudi link, “The Washington Post,” citing an anonymous official, reporting today that Saudi police are investigating a series of calls between Saudi Arabia and London involving cell phones of known al Qaeda operatives in the Persian Gulf.  Police are also interested in a cell phone call made by Hamdi Isaac, also Osman Hussain, AKA Hussain Osman, the would-be Shepherd‘s Bush bomber.  He found (ph) Saudi Arabia just hours before he was arrested in Rome.

And as Lisa just reported, the alleged ringleader of the July 21 cell, Muktar Said Ibrahim, actually traveled through Saudi Arabia on his way to Pakistan.  According to “The Washington Post,” so did Hasib Hussain, the July 7 bus bomber.  Saudi officials are now trying to retrace his moments in the capital, Riyadh, before he moved on to Pakistan.

Word of the terror connections coinciding with a shift at the very top of the Saudi hierarchy today.  Ten yeas after the debilitating stroke that left him a ruler in name only, King Fahd has passed away.  During his 23-year reign, King Fahd modernized Saudi Arabia and fostered strong relations with the United States, but also somewhat inadvertently encouraged radical Islam.  In an effort to be seen as a strong Islamic leader and not the Western playboy he had been in his youth, King Fahd poured millions of dollars into fundamentalist schools and the religious establishment.  In the 1980s, along with the United States, he also financed the mujahedeen in Afghanistan, and his decision in 1990 to allow the American military to base some Gulf war operations in Saudi Arabia sparked outrage among the country‘s hard-wing religious extremists, including Usama bin Laden.

King Fahd‘s successor, 81-year-old Crown Prince Abdullah, has been the de facto ruler of Saudi Arabia since 1995 and has continued to foster a strong friendship with the United States, as evidenced by his visit with President Bush earlier this year.  But his government still comes under criticism for not doing enough to curb radical Islam or to democratize the kingdom.

Let‘s bring in investigative journalist Craig Unger, author of the celebrated and somewhat controversial book, “House of Bush, House of Saud:

The Secret Relationship Between the World‘s Most Powerful Dynasties.”

Craig, thank you so much for your time tonight.

CRAIG UNGER, AUTHOR, “HOUSE OF BUSH, HOUSE OF SAUD”:  Thanks for having me.

STEWART:  Crown Prince Abdullah has been essentially ruling this kingdom since King Fahd‘s stroke.  Is there any reason to believe that U.S.-Saudi relations will change significantly now that he‘s becoming the king?

UNGER:  Well, I think on the surface, this seems like a very smooth transition, in the sense that Abdullah, as you say, was already ruling Saudi Arabia.  And in addition, Prince Sultan has moved up from minister of defense to the crown prince slot.

At the same time, in the background, you have an enormous number of powerful contradictions.  Saudi Arabia is both the most—has more oil than any country in the world, but also, as you reported, one of the biggest breeders of terrorism ever.  And another factor is you have—

China is now on the ascendancy.  It‘s consuming more oil than ever before.  So it will be posed a threat as a rival to this special relationship that the United States has had with Saudi Arabia.

STEWART:  So China will be looking for Saudi Arabia‘s affections, as well.  I want to go to your point about the terrorist breeding ground.  Do you believe the U.S. government now can put more pressure on Saudi Arabia to crack down on extremism?

UNGER:  I think that‘s unlikely.  We are desperate for oil.  We have 210 million cars on the road.  We are addicted to oil.  We have no serious source of alternative energy, so we need that Saudi oil.  And we have really been—whatever pressure we have put on the Saudis from the Bush administration has mostly been lip service.

STEWART:  Well, how might King Fahd‘s death impact the way Saudis are fighting terror within their own country?  Obviously, they‘ve had to deal with it, considering these bombings in 2003 in Riyadh?

UNGER:  Well, Saudi Arabia is a kingdom that‘s torn in two, in many ways.  On the one hand, I think Abdullah, both as crown prince and now as king, has taken some very serious measures in trying to democratize Saudi Arabia.  There were municipal elections, which was a significant step towards democracy.  It is not, by any means, a real democracy, however.  Women are not allowed to vote, or even allowed to drive.

At the same time, it‘s important to remember that Wahhabism is the state religion.  This is a theocratic monarchy, and Wahhabism is a puritanical fundamentalist sect that, in many ways, has helped breed the kind of terrorism we see today.  Usama bin Laden grew out of it.  Al Qaeda grew out of it.  And the Saudis, at least through the sins of omission, have encouraged—allowed terrorism to grow, even quite recently, as we‘ve seen with the London bombings in the last month.

STEWART:  Craig Unger, author of “The House of Bush, House of Saud,” thank you so much for your perspective.

UNGER:  Thanks for having me.

STEWART:  First came the adamant denial before Congress.  Now comes the punishment.  Rafael Palmeiro is biggest name in baseball to face a 10-day suspension for steroid use.  And from Neverland to desertland, reports Michael Jackson has purchased a new home.

But first, here are COUNTDOWN‘s top three sound bites of this day.

(BEGIN VIDEO CLIP)

DAN ABRAMS, HOST, “THE ABRAMS REPORT”:  You did exactly what you needed to do.  I‘m so glad to see that you‘re—that you‘re OK.  Caden (ph), great job in knowing what to do immediately.  This has got to be an awful, awful scary experience, and I think you dealt with it in exactly the way people would hope.

UNIDENTIFIED MALE:  Thank you.

UNIDENTIFIED FEMALE:  Thank you.

MATT LAUER, CO-HOST, “TODAY” SHOW:  But I mean, if you see a buddy of yours on the street, a real good friend, you go up and you embrace him, you don‘t just shake hands?

UNIDENTIFIED MALE:  (INAUDIBLE)

LAUER:  Yes?  OK.  Ellie—Ellie, what do you...

DAVID LETTERMAN, HOST, “LATE SHOW WITH DAVID LETTERMAN”:  This is fascinating.  Restoration is now being done on the—Mount Rushmore.  Now, the project was supposed to be near completion by now, but workers have faced some unexpected difficulties.  Watch this.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

RAFAEL PALMEIRO, BALTIMORE ORIOLES:  I have never used steroids, period.

(END VIDEO CLIP)

STEWART:  You know, I bet right now, he wished he‘d slipped the adverb “intentionally” in there.  Our number two story on the COUNTDOWN tonight:

Baltimore Orioles first baseman Rafael Palmeiro now the seventh player to be suspended by major league baseball for testing positive for steroids.  The duration of the suspension may only be 10 days, but its impact is 10 times greater.  More on that in a moment.  First, our correspondent from New York this evening, Ron Allen.

(BEGIN VIDEOTAPE)

RON ALLEN, NBC NEWS (voice-over):  With that hit, Rafael Palmeiro became just the fourth player ever to reach 3,000 hits and 500 home runs, but now a positive drug test for steroids has tainted the Baltimore Orioles first baseman, who has Hall of Fame credentials.  Today, he called the Orioles radio announcers to apologize.

PALMEIRO:  I made a mistake and I‘m facing it, and I hope that the fans forgive me.

ALLEN:  It‘s an embarrassing strike after Palmeiro‘s testimony before a congressional hearing on steroids and baseball earlier this year.  While other stars hedged, Palmeiro was adamant.

PALMEIRO:  I‘ll be brief in my remarks today.  Let me start by telling you this.  I have never used steroids, period.

ALLEN:  That statement may lead to charges he perjured himself before Congress.

HOWARD BRYANT, AUTHOR, “JUICING THE GAME”:  This is terrible for Rafael Palmeiro because he was the guy, more than anybody else during those hearings, who proclaimed his innocence.

PALMEIRO:  Today Palmeiro, in a carefully worded statement, said, “I have never intentionally used steroids.”  Palmeiro was named publicly and faces an immediate 10-day suspension under baseball‘s new tougher policy adopted this year.

(on camera):  Every player must undergo at least one unannounced test, and random tests take place throughout the season.

BRYANT:  Clearly, it has not been the ultimate deterrent.  So now you have to wonder what it‘s going to take to get the message across to players.

ALLEN (voice-over):  Major league baseball says the positive test proves its new rules work, seven players suspended for violating baseball steroid policies so far this season, now including one of the game‘s biggest sluggers.  Ron Allen, NBC News, New York.

(END VIDEOTAPE)

STEWART:  Peter Schmuck—and that is his real name—is a sports columnist with the Orioles‘ hometown paper, “The Baltimore Sun.”  Peter, thanks for being with us.

PETER SCHMUCK, “BALTIMORE SUN”:  No problem.

STEWART:  The suspension was in arbitration.  The players union had filed a grievance .  So do we know exactly when this test took place and the timeline of the whole thing?

SCHMUCK:  No, we don‘t, and it‘s very important because if this test took place before that March 17 hearing, then Rafael Palmeiro may have a problem with contempt of Congress or lying to Congress.  I suspect that Congress has better things to do than chase after Rafael Palmeiro, but the damage really to him is to his image and to his chances of getting into the Hall of Fame in five or six years.

STEWART:  Let‘s talk about that image first.  When he was named in Jose Canseco‘s book, it was a little bit of a head-scratcher, and then the appearance in front of Congress, he was so articulate and passionate about not taking steroids.  Does this steroid accusation—is it in his profile, his character as a player, for people who don‘t know about him?

SCHMUCK:  Well, it certainly was a stunner for those of us who‘ve covered him over the years, and I have covered Rafael Palmeiro for more than 10 years.  He‘s a guy who does not have those signature attributes that people place on the guys who they think might be using steroids—the back acne, the mood swings, the, you know, kind of cartoonish, buffed-out look.  He has none of that, and so we never really suspected Rafael Palmeiro.

And then when Jose Canseco named him in his book, it just didn‘t have a ring of truth, and that sort of was the anecdote or one of the anecdotes that made people dismiss a lot of what Jose Canseco had said in that book.  And now, with this positive test coming out, it really makes—makes it a situation where you have to look back at what Jose Canseco said.  I hate to do it because, you know, his credibility is very, very low, but a lot of what he has said is borne out.

STEWART:  Let‘s talk about this word “unintentionally.”  Is there any way to unintentionally take steroids?

SCHMUCK:  Well, maybe there is, but one of the problems that Rafael Palmeiro has—and certainly, those of us who‘ve covered him and respect him as a player hope that‘s true.  But the fact remains that the seven players that have tested positive since this new steroid policy has gone into effect have basically all given the same excuse, that they did something unintentionally.

And one of the problems with that is that Rafael Palmeiro is a guy who‘s made probably more than $50 million in his career.  He‘s a guy who has union officials to help him.  He has personal trainers.  He has team doctors.  He has plenty of people to tell him what‘s in the stuff he‘s taking and somebody—plenty of people to read those labels and match them up to that list of banned substances.  And so if, in fact, he made a mistake, it is one stupid mistake.

STEWART:  And you brought it up, the Hall of Fame.  What does this do for his chances?

SCHMUCK:  Well, it certainly hurts him a little.  I still think that the fact that he‘s in a small club of 3,000 hit, 500 home run guys that includes Hank Aaron, Willie Mays and Eddie Murray certainly works in his favor five, six years down the road that he‘s eventually going to get in.  But now the issue of first ballot versus second ballot versus third ballot, I think he drops a little bit.  He gives credence to some people who felt he was marginal because he never really was a dominant player of (ph) his image.  So it definitely could have an effect.

STEWART:  Peter Schmuck of “The Baltimore Sun,” thanks a bunch.

SCHMUCK:  Thank you.

STEWART:  Fairly easy transition, then, to our nightly round-up of celebrity news and gossip, “Keeping Tabs.”  Move over, Neverland ranch.  Michael Jackson has purchased 14 acres of property in Bahrain, where he‘s been laying low since his acquittal in June.  Jackson has reportedly been enjoying a certain amount of anonymity there, wandering the streets in traditional dress, complete with the headdress.  You can insert your plastic surgery joke here.  The self-anointed “King of Pop” already has a royal neighbor.  His new estate is next to the palace of the king of Bahrain‘s son.

In addition to a new home, the singer is also looking for a new publicist.  Jackson reportedly approached British guru Max Clifford (ph) about a month ago, who turned him down cold, saying, quote, “It would be the hardest job in PR after Saddam Hussein.”

And what does a 69-year-old actor do after he wraps up the movie version of “The Dukes of Hazzard”?  What else?  He thinks about what life would be like if he were gay.  Burt Reynolds, plugging his schtick in the “Hazzard” flick, told the “Tonight” show‘s Jay Leno that Willie Nelson was, quote, “the nicest man I‘ve ever worked with in my life and the sweetest, kindest man.  I thought if I‘d been gay, it would have saved me millions.”  Reynolds had a nasty and expensive divorce from Loni Anderson years ago.  He told Leno that he and Willie Nelson would still be, quote, “happily married.”  And of course, just think of the songs that Willie could have written.

And this might be the only way someone from Hazzard County would ever see an art show—stark, buck naked.  Why free of clothes means free of charge at “The Naked Truth.”

(COMMERCIAL BREAK)

STEWART:  To the top of the COUNTDOWN now, which is best perhaps described in the words of the poet and artist William Blake.  “Art can never exist without naked beauty displayed.”  Now, whether his reference was about laying bare humanity and nature for philosophical examination or merely about dropping trou and shaking what your mamma gave you, who knows?  But it‘s all our number one story tonight.  And we begin with the high art interpretation of Blake‘s words, the cinematic surprise of the summer, penguins.  COUNTDOWN‘s Monica Novotny joins us with more.

Hi, Monica.

MONICA NOVOTNY, COUNTDOWN:  Hi, there, Alison.  Much has been made of the box office slump this summer, but one documentary is now the surprise hit of the season, and the movie‘s stars made sure to dress for occasion.

(BEGIN VIDEOTAPE)

ANNOUNCER:  For 20 days and 20 nights, the emperor penguin will march to a place so extreme, it supports no other life.

NOVOTNY (voice-over):  They‘re all dressed up with a long way to go.  Emperors on parade or penguin procreation, this black-tie brood making an annual 70-mile trek from home to their breeding ground, now the subject of this summer‘s surprise box office success story, “March of the Penguins”.

UNIDENTIFIED MALE:  It‘s completely unique, and it‘s competing with “War of the Worlds” and lots of other blockbuster hits and doing well.  So I think it‘s—I think it‘s incredible.

ADAM LEIPZIG, NATIONAL GEOGRAPHIC FILMS:  It‘s perfect summer counter-programming.  At a time when every weekend, there are $150 million blockbuster special-effect-driven movies, this is just a breath of fresh air.

NOVOTNY:  The documentary, a dramatic-comic love story shot in Antarctica over 14 months at a cost of $8 million, defying this summer‘s box office slump, earning more than $16 million already, on its way to becoming the second highest grossing documentary of all time domestically, behind Michael Moore‘s “Fahrenheit 9/11,” moviegoers flocking to see the birds.

UNIDENTIFIED MALE:  What makes it so effective is it‘s connected to very human emotions, and that‘s, I think, you know, why it—why it simply works.

UNIDENTIFIED FEMALE:  It‘s about nature and about instinct, and it‘s probably because it‘s not about people.  It‘s much more fascinating.

NOVOTNY:  Even spawning the inevitable copycats.

UNIDENTIFIED FEMALE:  It‘s a short film, a student film, about a guy who‘s being randomly followed by a giant penguin.

NOVOTNY:  There are critics.

UNIDENTIFIED CHILD:  It was, like, really good.  But if you don‘t like movies where little, cute, innocent things die, this is not the movie for you.

UNIDENTIFIED FEMALE:  You have to be in the right frame of mind, though, I think.  It is kind of sappy.

NOVOTNY:  But these penguins continue their march with a message for Hollywood.

LEIPZIG:  You can‘t try to make a blockbuster.  You just have to try to make a good movie.  If you make a good movie, the audience will come.

UNIDENTIFIED FEMALE:  It‘s the lesson to be learned.  Simplicity.

(END VIDEOTAPE)

NOVOTNY:  Those emperor penguins are the largest of the 17 penguin species.  They can grow to be over three feet tall, weighing as much as 90 pounds.  And if you want to see more, you can.  Given its success, plans are for the movie to open in 1,300 theaters starting this Friday.

STEWART:  And I think I‘m in love.

(LAUGHTER)

STEWART:  Monica Novotny...

NOVOTNY:  It‘s hard not to be!

STEWART:  ... thank you so much.  Can‘t wait to see it.

From the relatively modern medium of cinema, we now turn to the more staid tradition of oil on canvas.  It‘s called “The Naked Truth,” and it‘s the latest installation at the famed Leopold Museum in Vienna.  But as everybody knows, sometimes the truth hurts, especially if it‘s wearing a Speedo.  And you know what I mean.  The past weekend, the Leopold allowing its patrons to view the early 20th century erotic art free of charge if they arrive free of clothes.  Our correspondent is Jim Maceda.

(BEGIN VIDEOTAPE)

JIM MACEDA, NBC CORRESPONDENT (voice-over):  It‘s a midsummer‘s heat wave, with temperatures soaring to the 90s, and millions of Europeans are seeking relief wherever they can find it.  But few will find a more unique answer to the unusually hot weather than here, in a museum, of all places, and in traditionally buttoned-up Vienna, Austria.  The prestigious Leopold Museum decided to offer free tickets to its latest exhibition of early 20th century erotic art, aptly entitled “The Naked Truth,” if customers showed up wearing a swimsuit or less.

I think it‘s funny, says this uninhibited visitor, and a good promotion for the museum.  Indeed, attendance has broken all records.  Stuffy Viennese critics are calling it naked commercialism.

(on camera):  But the curators say it‘s the perfect exposure for dozens of erotic works by Austrian artists, including the world famous Gustav Klimt.

(voice-over):  Organizers don‘t deny that many paying customers were lured by the reality, as well as the art.

VERENA DAHLITZ, MUSEUM SPOKESWOMAN:  I guess we will have around 500 or 600 more people in the museum today than usually.

MACEDA:  It‘s not the only time art and controversy have mixed this hot summer.  Early in July, some 1,500 volunteers stripped and posed nude in various outdoor locations in northern England, part of a mass naked photo session by an American contemporary artist.  Shocking?  Hardly, for the artists.

SPENCER TUNICK, ARTIST:  Put all their hearts into it had a good sense of humor, I think.

MACEDA:  Back at the Leopold, curators deny the free tickets were just a stunt and insist they want to celebrate the human form.  But even here, with art stripped to its bare essentials, some Viennese were still seen trying to figure it all out.  Jim Maceda, NBC News, London.

(END VIDEOTAPE)

STEWART:  And that is COUNTDOWN.  I‘m Alison Stewart, in for Keith Olbermann.  Thanks for watching.

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

END   

Content and programming copyright 2005 MSNBC.  ALL RIGHTS RESERVED.  Transcription Copyright 2005 Voxant, Inc. ALL RIGHTS  RESERVED. No license is granted to the user of this material other than for research. User may not reproduce or redistribute the material except for user‘s personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon MSNBC and Voxant, Inc.‘s copyright or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.

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