updated 10/29/2005 5:03:21 PM ET 2005-10-29T21:03:21

Guests: Michael Isikoff, Dick Sauber, Dana Milbank, Ed Rogers

CHRIS MATTHEWS, HOST:  Vice President Cheney‘s chief of staff, Scooter Libby, resigns after being indicted on charges of obstruction of justice, perjury and making false statements in the CIA leak investigation. 

President Bush‘s top aide, Karl Rove, was not indicted today.  But in a news conference, special prosecutor Patrick Fitzgerald said the probe is not over. 

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews. 

Tonight, we know Vice President Dick Cheney‘s chief of staff Scooter Libby resigned after he was indicted on five counts of obstruction of justice, false statements and perjury charges related to the CIA leak case.  We know that if convicted on all counts Libby could face as many as 30 years in prison. 

We know President Bush‘s closest adviser, Karl Rove, escaped indictment today but remains under investigation. 

We know that special prosecutor Patrick Fitzgerald says the major bulk of the work in the investigation has concluded but the investigation, as I said, is not over. 

We‘re going to be saying that tonight a few times. 

For the latest, let‘s go now to HARDBALL correspondent David Shuster, who is at the federal courthouse where everything happened today in Washington, D.C.—David?

DAVID SHUSTER, HARDBALL CORRESPONDENT:  Well, Chris, the grand jury returned about noon today, delivered the five count indictment, charging Scooter Libby, the vice president‘s chief of staff, one count of obstruction of justice, two counts of perjury, of lying to the grand jury, two counts of lying to federal investigators who were working for Patrick Fitzgerald. 

The indictment does not charge Scooter Libby with any illegal acts for disseminating classified information about an administration critic. 

But the prosecutor today pointed out that because of the alleged obstruction of justice, many of the questions about whether, in fact, there was or was not an orchestrated scheme or plan—many of those questions have not been answered, at least not to the satisfaction of the prosecutor.  And that is why he said he is keeping this investigation going. 

Here is part of what he had to say. 

(BEGIN VIDEO CLIP)

PATRICK FITZGERALD, SPECIAL PROSECUTOR:  I will not end the investigation until I can look anyone in the eye and tell them that we have carried out our responsibility sufficiently to be sure that we‘ve done what we could to make intelligent decisions about when to end the investigation. 

We hope to do that as soon as possible.  We just hope that people will take a deep breath and just allow us to continue to do what we have to do. 

(END VIDEO CLIP)

SHUSTER:  Now, regarding Scooter Libby, he, according to the indictment, was charged with misleading the grand jury, misleading the FBI, about his conversations with reporters, but also how Scooter Libby actually learned information, learned classified information about the wife of administration critic Joe Wilson. 

The indictment lays out in excruciating detail a series of efforts by Scooter Libby to learn about Joe Wilson, efforts that started with calls to the State Department, then involving documents received by the Central Intelligence Agency, and then in mid-June 2003 a discussion with the vice president in which the indictment alleges that Scooter Libby learned about Valerie Wilson and Joe Wilson from the vice president himself. 

There are also references, Chris, to discussions that Scooter Libby then had with Ari Fleischer, who was the press secretary in July of 2003, discussions aboard Air Force Two with other officials in the vice president‘s office about what to do about the media inquiries into these reports that perhaps the administration had misled the nation when it made the claim that Iraq was seeking uranium from Africa. 

But again, this investigation focuses just on Scooter Libby. 

The prosecutor left open the possibility that, in fact, a new grand jury which could be taking evidence as early as next week, that they might present more information. 

But the prosecutor also sounded, Chris, rather pessimistic that any new information might be coming from Scooter Libby, who will be arraigned here at this federal courthouse now in the next couple of weeks, the next step in this investigation process—Chris? 

MATTHEWS:  OK.

Thank you very much, David Shuster. 

Joining me now is NBC chief foreign affairs correspondent Andrea Mitchell and “Newsweek”‘s Michael Isikoff. 

Andrea Mitchell, I want you to put together the policy part of this just for a minute now.

One thing—we‘ve learned a couple of things during this long investigation.  One is the enormous central role played by Scooter Libby, the chief of staff to the vice president.  We‘ve seen where he leaked certain information to the “New York Times” that showed up on the Sunday pages of the “New York Times,” and then the next morning, magically, three

administration officials are deployed on the various Sunday shows to say,

“Did you see that piece in the ‘Times‘ today that built the case for war?‘” 

We also now are seeing him faced with 30 years of indictments for criminal charges here. 

How much of a loss is this for the White House, this man leaving today? 

ANDREA MITCHELL, NBC CHIEF FOREIGN AFFAIRS CORRESPONDENT:  Well, I think it is a great loss.  And I think it‘s a loss to the president and the vice president in particular, because he has been a crucial adviser. 

So he has been one of the important, substantive strategists, as well as a political strategist for this White House. 

And substantively he is a foreign policy expert, he was one of the original neoconservatives who worked very closely with Paul Wolfowitz, with others in the Pentagon, and then of course in the vice president‘s office when Vice President Cheney was elected with George W. Bush, to bring those values, those core values. 

And part of that was an intent focus on Iraq, on Saddam Hussein, a belief that he was a threat, and an imminent threat, to this country. 

So I‘m not suggesting in anyway—in fact, exactly the opposite—that Scooter Libby and others in this administration in the run up to war were misleading people or lying about what they viewed the intelligence. 

From many conversations that I‘ve had with him over the years and with others who were part of the same policy group, they believed very strongly that Saddam Hussein had weapons of mass destruction and they certainly looked for every sign in the intelligence. 

And of course the accusation is that they misread the intelligence and cherry picked it and only looked at what they wanted to see. 

This is a very big loss from a foreign policy perspective for the White House and certainly a personal loss to the vice president, who relies so heavily on Scooter Libby. 

MATTHEWS:  I guess the big question I‘m going to ask myself in the weeks and months ahead, maybe the rest of my life, is if you go to war which has cost us now 2,000 dead and 7,000 permanently injured, should we do it on background; should there not be a public case for war, not one fed to one newspaper without names attached, in fact, misleading people by saying “former Hill staffer” and things like that to get us into a war, and then pull an alley-oop play on Sunday television by saying, “Did you see that piece in the ‘Times‘ today?” 

MITCHELL:  Well, actually, Chris, I think they did make the public case. 

I think in those television interviews, all of those moments that we‘ve now seen where Dick Cheney was on “Meet the Press” and other shows saying that Saddam Hussein was reconstituting his weapons of mass destruction, the president himself said it in October of ‘02 and again in November, and again in the State of the Union in ‘03 -- so certainly the allegations were out there publicly. 

But you‘re right, there was a leak campaign as well, and there were selective leaks to selective reporters as we now know. 

The case for war should be debated as part of this whole investigation and the run up to a trial, if there is a trial. 

Although, I think there will also be an attempt by the prosecutor to narrow the focus of this, as he said, that this is not rearguing the Iraq war. 

(CROSSTALK)

MATTHEWS:  Maybe we should argue it for the first time. 

MITCHELL:  Exactly.

MATTHEWS:  Let me go to Mike Isikoff, Andrea. 

Mike, it seems like the vice president‘s chief of staff has really been charged for not a commercial—he didn‘t do anything to steal any money, he didn‘t do anything to steal pencils from the office or anything else.  He was doing what he thought was his political job of defending the vice president against charges that he had somehow sent us to war on false premises. 

MICHAEL ISIKOFF, “NEWSWEEK”:  Correct. 

And it‘s also worth noting that Libby is not actually charged with doing anything that led to the dissemination of information about Joe Wilson‘s wife until prior to the Robert Novak column. 

He does have the conversations with Judy Miller prior to the Novak column, but Judy Miller never writes a story. 

MATTHEWS:  In other words, he‘s not charged with outing here? 

ISIKOFF:  He‘s not charged with outing here. 

He has a very brief, fleeting conversation with Matt Cooper, yet Matt Cooper doesn‘t write until after the Novak column. 

So it can be argued that Scooter Libby did nothing that led to the disclosure of classified information relating to Joe Wilson‘s wife. 

MATTHEWS:  You‘re the best investigator in the business, I think. 

You‘re the scariest call-back slip anybody ever got, I‘ll tell you that. 

But let me ask you this:  Did you know that he had this many contacts, Scooter Libby, with various administration officials discussing the identity of this agent before he ever talked to people in the press? 

ISIKOFF:  No.

It‘s more than we knew about.  We knew—just this week, we learned about the conversations with the vice president.  We knew from Judy Miller‘s account that he had been seeking information, that he had been talking about Joe Wilson‘s wife. 

But we learned today for the first time that he had discussions about it with his CIA briefer.  We learned today for the first time that the undersecretary of state, Mark Grossman (ph), had talked to him about it. 

We learned today that he had a conversation on the telephone with his principal deputy about the subject, and then tells the principal deputy that this can‘t be discussed on a nonsecure line, an indication that he knew how sensitive this material was. 

MATTHEWS:  Sensitive in terms of classified or sensitive in terms of the politics? 

ISIKOFF:  Sensitive—it was classified. 

And so one can presume, and we won‘t know until we hear the testimony at trial, but it sounds like he knew that it was classified information. 

MATTHEWS:  What made a smart guy like this...

(CROSSTALK)

ISIKOFF:  That‘s why you talk about it on a secure line rather than a nonsecure line. 

MATTHEWS:  OK.

All these communications about the identity of this woman and he still tried to lay it on the press. 

How did he think he could get away with that with the special prosecutor; that the press wouldn‘t talk?

ISIKOFF:  Well, he obviously didn‘t bargain for Patrick Fitzgerald and how tenacious he is.

But what‘s really striking when you look through the evidence, the principal witnesses after he—Fitzgerald establishes the case that he got all this information about Libby are going to be the reporters, and first and foremost, it‘s going to be Tim Russert of NBC News, because it‘s the Russert conversation that is the most damning, as outlined in...

MATTHEWS:  He laid it on Tim that he had told him. 

ISIKOFF:  Right. 

He describes an entire conversation with Tim Russert, in which Russert, according to Libby‘s testimony, is telling him for the first time, that Wilson‘s wife works at the CIA, and reporters all over town know about it. 

MATTHEWS:  But this is wacky because it‘s similar to Karl Rove saying that his conversation with Matt Cooper of “Time” was about welfare reform. 

I mean it‘s not—it‘s one thing to forget.  It‘s another to super impose new information in your memory track and claim that happened. 

ISIKOFF:  Right. 

And I think that‘s why Rove was in so much jeopardy.  He does appear, I have to say, based on Fitzgerald‘s comments today and all of the body language at a press conference, is it didn‘t sound like Fitzgerald is getting ready to bring more major indictments in this case. 

So, at this point, it looks like this case is going to be about Scooter Libby. 

MATTHEWS:  OK. 

Well, always want you back, Michael Isikoff of “Newsweek,” can‘t wait to read the big stories this weekend. 

Thank you, Andrea Mitchell, you‘ve been on with us all day. 

Andrea knows everything about everything, the policy, the politics, the investigative, the good stuff. 

Coming up, NBC‘s Tom Brokaw will join us with his take on today‘s events and what it all means for President Bush‘s second term. 

You‘re watching HARDBALL only on MSNBC. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE:  If Mr. Libby is proven to have done what we have alleged, convicting him of obstruction of justice, perjury and false statements, very serious felonies, will vindicate the interests of the public in making sure he‘s held accountable. 

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  I‘m joined right now by longtime NBC nightly new‘s anchor Tom Brokaw, he just completed an in depth report on the evangelical movement in this country called, “In God They Trust.: 

It airs tonight at 8:00 Pm Eastern time on NBC. 

Tom, thanks for joining us.  I want to talk about this special, but obviously we got to start with the news today. 

Impact statement from Tom Brokaw, please. 

TOM BROKAW, NBC NEWS:  Well, I was struck by watching Michael Isikoff.  I remember how much grief he got from the administration and his supporters when he had one small item in the the periscope in “Newsweek” about the desecration of a Koran in Guantanamo Bay, which later, generally, the description of that turned out to be true, according to the Pentagon itself. 

And how he was held up, and pilfered and scoured by administration officials and also, of course, by administration supporters. 

And now you have chief of staff, the man who is in all the intersections on national security issues, with very, very serious indictments against him.  And it‘s one, if the allegations are true and no one is denying that they are, Chris. 

In all the years I‘ve been covering Washington scandals, this is the clumsiest case of lying I‘ve ever been witness to. 

MATTHEWS:  Well, I guess. 

Well, let me help you. 

Well, let me talk about what that might be.  You mean, the fact that he apparently, there‘s evidence that he talked to half dozen government officials about the identity of Valerie Wilson, the wife of the former ambassador, who took the strip to Africa to check out the uranium story.    And then laid it on the press. 

BROKAW:  And then concocted this scheme.  Beginning by trying to set up Tim Russert of NBC News, saying that he was the first one to introduce it.  I mean, he even took Ari Fleischer to lunch, which I don‘t think he did on a very regular basis, and talked to him about it. 

The impression that one could get from that is that he was trying to get Ari Fleischer to get her name out there in some fashion.  So, the real lingering question for me is, was this a one man band?  Or were there others in the administration who were linked to his efforts to do that? 

And, of course, the question that will be raised by a lot of people, who are not in anyway fans of this administration, what did Dick Cheney know and when did he know it? 

You know, they‘re joined almost cheek by jowl.  They ride to work every morning.  They‘ve been very close philosophically and personally for a long time. 

MATTHEWS:  This has a lot to do with the use by—and you covered the White House for so many years, and you‘ve seen how it‘s used. The White House, and it‘s called news management, I suppose, how they try to use the media, the mainstream media, the big networks, et cetera, the big newspapers, to try to get their point across. 

Have you seen anything like this where a top White House official, Scooter Libby, was so successful in using “The New York Times?”  And again, as you said, they tried to lay off the blame for something, in terms of the chain of custody of some story they should have been putting out on the media.

Is this new, this hardball, this really tough use of the media?

BROKAW:  No.

MATTHEWS:  And threats that seem to be part of this business too against people who threaten them with stories and accounts. 

BROKAW:  No, it‘s not new.  It‘s—there‘s always been this symbiotic relationship in which the press and the administrations have used each other over the years.  And sometimes, you know, individual newspapers or correspondents or reporters have gotten caught in that trap. 

But this one was very aggressive and the stakes were very high, obviously.  And we were at war at the time. 

I think it also speaks to something that we‘ve all been discussing for some time now about what happens once you get inside that White House bubble. 

And you‘re immune for a long time to the kind of criticism that the administration started to get from Joe Wilson and others about what was going wrong in Iraq, and how the country may have been misled about the terms for making the decision to go to war is that you begin to think that you‘re infallible. 

And anyone who challenges you in some fashion then deserves to be, you know, brought out and put on the stake in some fashion.  This whole business of being extra tough is always a premium in any White House. 

MATTHEWS: The president, according to a piece by, I believe, Tom DeFrank, who has been doing some great stuff for “The New York Daily News,” is the president is dismayed, is the word he used, that he hasn‘t been blamed here.  That he is somehow seen as not part of the loop. 

Isn‘t that an amazing feeling to get from the White House?  The president is mad he hasn‘t been blamed because people are assuming he is sort of a serving head of state, but the operations are in the vice president‘s office. 

BROKAW:  Well, you know, I like Tom DeFrank a lot, we were both at the White House at the same time during the Gerald Ford administration.  I‘ve always thought he was a first rate correspondent. 

I‘d like to know his sources on that one, Chris. 

MATTHEWS:  Who might they likely be? 

Let me ask you about the implications. 

Now, the stories that we‘ve written around the world they‘ll be on nightly tonight.  They are going to be in the big papers tomorrow. 

Will the White House be able to couch this as a bad day?  But basically they won the argument.  They were not proven guilty of leaking this name.

BROKAW:  Yes, I think that there is some conditioning going on here.  We were, you know—all the speculation leading up to this, I said earlier in the day, reminded me of sports writers sitting around before the Super Bowl knowing with certainty about what was going to happen and then the kickoff occurs and the game plan changes altogether. 

We ended up with one indictment today.  There was a lot of talk about how many people this could spread to during the course of the investigation, and that the leaker probably would be named in some fashion. 

I agree with Michael, watching Mr. Fitzgerald, both listening to his verbal descriptions and watching his body language, I don‘t think that he has an indictment in mind for Karl Rove.  There are some lingering questions that he wants to get resolved. 

So the administration probably is taking some solace tonight in what you just said, that they were not the source of the leak, and that it didn‘t extend all the way to Karl Rove, which I know is going to be an acute disappointment to a lot of people who are not fans of this administration politically or otherwise. 

MATTHEWS:  Right.  The partisans I think were gunning for Karl Rove.  But let me ask you this amputation of the partner of the vice president, who is the partner of the president.  How do they heal that and move on? 

BROKAW:  Well, I think that I‘ll leave it to them to come to grips with that.  I think it‘s going to take some pretty skillful choreography.  I was talking earlier, again, today, about what happened in the second Reagan term, with the, what I thought was a much wider, deeper scandal. 

And that was the Iran-Contra scandal, in which you had a rogue national security operative, operating out of the basement of the White House, making deals with foreign governments, and going against the mandates of the United States Congress, shipping arms to Israel, through Israel to Iran, and trying to run a war from the White House in Central America. 

What Ronald Reagan did, with a lot of nudging from his friends and people like Jim Baker and others, that—he cleaned house.  And he brought in a new team.  He brought in someone who was extremely popular in Washington, Howard Baker, and they had to put the place back together again. 

MATTHEWS:  And they even found a speech writer to write the words for him that he didn‘t know about it, Langley Parson (ph). 

BROKAW:  And in this case, however, the relationship between Vice President Cheney and President Bush is more complicated.  The nation is at war now.  The president indicated in his remarks as he left for Camp David that he has not changed, tonally, at least. 

You know, he thanked Scooter Libby for his service to the country.  He said he‘s given much to the country, and that he‘ll get back to the job of protecting this country.  So I think that, you know, a lot of this weekend at Camp David will be given over, my guess is, to thinking what he does next.  And we‘ll see if he comes to any conclusions about that. 

MATTHEWS:  Let‘s come back and talk to Tom Brokaw right after this break about his special tonight on the evangelical movement in this country.  The question of values and trust and ethics are all coming together here. 

And still ahead, much more on today‘s indictment and resignation of Scooter Libby from two of Washington‘s top reporters, “Newsweek‘s” Mike Isikoff.  He‘s already been one.  And Andrea Mitchell, she‘s already been on, but we‘ll have some other interesting guests tonight.  We‘ll be right back with HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with Tom Brokaw of NBC News, who is hosting an in depth report about evangelicals in America tonight at 8:00 Eastern time on NBC.  It‘s called “In God They Trust.”  Tom, they also trust, it‘s fair to say, President Bush. 

The evangelicals, and the numbers they came out and voted this past November, had a lot to do with his second term.  Do you have a sense, doing this reporting on this program tonight, that they‘re disappointed in the second term? 

BROKAW:  Now I think that they still have some reservations.  They‘re keeping their powder dry as it were.  I think that they were very pleased with Judge Roberts.  They were divided about Harriet Miers as a nominee.  There are issues that they monitor very careful. 

A central player in tonight‘s report is Ted Haggard, who is the pastor of the New Life Church in Colorado Springs, very charismatic figure with great marketing skills, a terrific preacher, to 6,000 people at one service and two hours later another 6,000 come in. 

And he said to me, among other things, that he believes that the Republicans have not gotten the message, for example, on the environment.  The evangelical movement feels strongly that it‘s the stewards of keeping the earth viable for human population.  And he said if the evangelicals turn in that direction, the Republicans will follow us. 

One of his great phrases was he said what people are voting every Sunday by where they go to church and what they believe.  And right now I‘m winning that election.  So, yes, they still believe in President Bush, but they‘ve got a very high bar and they intend to keep it high. 

Chris, let me just say one other thing about that, by the way.  I was in Los Angeles yesterday listening to talk radio.  And talk radio out there is, fair to say, I think, on the right side of the dial.  And all day long, in all the day parts, everybody that I was hearing on talk radio, no one had given up on the president yet. 

They were really being very supportive of him.  They were blaming the liberals for making too much out of 2,000 dead.  They were blaming Congress for all the spending that was going on.  The president was untouched in about four hours of listening to talk radio yesterday.  So within his constituency, and the rank and file, he seems to be doing OK. 

But I think he has profound problems, now, on what I call the intellectual wing of the conservative movement in the country, the Bob Borks, the George Wills, the Charles Krauthammers and so on. 

MATTHEWS:  Well, that‘s only about 20 people though, isn‘t it?  The ones that write the columns? 

BROKAW:  yes, but they‘re influential.  You know, they really have an impact when you—you know, when you saw what began to happen on Capitol Hill.  And they talk to each other.  And they network through the Internet and other ways.  And so, you know, I think there are a lot of moving pieces now, and what appeared to be, when the president swept into office this last time, a very solid front.  A lot of people ...

MATTHEWS:  The news they‘re going to get this evening on nightly and they‘re going to tomorrow in the papers locally, is it going to dismay them? 

BROKAW:  Yes, I would think so.  And just to take it back to the evangelical movement for just a moment, they do have that core constituency out there.  But some Republicans that I‘ve been talking to on Capitol Hill believe that their time has now peaked, that their last election was probably the apex for them, that a lot of Americans are being tired of being preached to, as it were, about having to toe the line on all of these issues, or else.

And we‘ll see how that plays out.  In the meantime, it is a phenomenon.  There are almost 1,000 megachurches in America now with congregations as large as 10,000 people and a lot of communities where they have traditional churches. 

Like, you attended the Catholic Church or the Methodist Church or the Congregational Church.  Those churches are struggling.  And on the edge of town, there‘s a large megachurch and people are going there. 

And for the first 45 minutes are listening to gospel rock. Then they hear a really uplifting sermon of some kind, they get more entertainment.  It plays out on large screens overhead, good choirs. 

And at the end of an hour and 15 minutes, there‘s no talk about guilt or sin.  The Jesus loves you.  And we know what our agenda is.  And you‘re here in a comfort zone. 

MATTHEWS:  And they‘re voting with their feet, they‘re going to the incredible buildings you catch on the highways.  You go, what‘s that?  Gigantic churches. 

BROKAW:  Yes.  And when election time comes around, they‘re not only well-organized, but my guess is that they vote by a factor of 95-to-98 percent, they go to the polls. 

MATTHEWS:  Do they have a candidate for next time to replace this president when the time comes? 

BROKAW:  No, I don‘t think it‘s fair to say they have a candidate. 

But, you know which side of the spectrum that they operate on. 

And, it‘s very important to them about gay marriage.  Very important to them about abortion, very important to them about abortion. Not only abortion rights, but also about judicial activism in America. 

Creationism and being able to teach intelligent design in schools is rapidly ascending on their scale.  Those are the issues that a lot of candidates are going to have to wrestle with the next time. 

MATTHEWS:  Thank you very much, Tom Brokaw.

That‘s tonight at 8:00 on NBC on “Dateline.”

Up next, more on today‘s developments and the question of what‘s next for the Bush administration. 

We‘ll get reaction. Lots of it to today‘s indictments from the attorney, TIME magazine reporter Matt Cooper. 

You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

(NEWSBREAK)

MATTHEWS:  Welcome back to HARDBALL. 

I‘m joined now by attorney Dick Sauber. 

He represents Matt Cooper . of TIME magazine, one of the two reporters at the center of the leak case. 

Dick, thanks for coming on here.  We can really use your help.

You watched that whole performance today by the independent counsel, by Mr. Fitzgerald.  Anything surprise you with regard to what you know in terms of leaks by Scooter Libby to your client, Matt Cooper?

DICK SAUBER, ATTORNEY:  No, I think it was what we expected to hear.  I was relieved to see that Matt Cooper‘s testimony was accepted for what it is, which was the simple truth of it. 

And we‘ll have to wait and see what happens at the trial. 

MATTHEWS:  How do you explain the big noise tonight and tomorrow, which is five counts, 30 years, if you pile up al the charges of perjury, obstruction of justice and making false statements?  It seemed to me, not being a lawyer, like I often say here, that‘s really piling on, that‘s throwing the book at him. 

SAUBER:  I think it‘s impossible to overestimate the impact on a prosecutor when a witness obstructs justice or lies in the investigation. 

It‘s not that you take it personally, but this is your job.  You‘re assigned to find out whether a crime has been committed.  You expect people to cooperate with you.  This is a very important investigation. 

He goes after it.  And it bothers you when people knowingly look you right in the eye and tell you something that turns out not to be true. 

MATTHEWS:  Do you think a little bit of humility would have saved Scooter Libby?  I‘ll leave it at that.  In a sense, he isn‘t any smarter than Fitzgerald, don‘t try to prove it. 

SAUBER:  Well, I don‘t know Mr. Libby at all.  But, I do know that smart people, all the time, make the wrong judgments in a law enforcement investigation. 

And I don‘t know whether it was humility, but it seems that maybe a little bit more honesty would have been helpful.  But people make—I don‘t want to prejudge the case, but people make bad mistakes all the time and most they often make them in the course of an investigation. 

MATTHEWS:  Scooter Libby is an agent as well as a principle.  He works for the vice president of the United States, he works for the president of the United States, he worked for the White House. 

He‘s not entirely a lone operator here. There‘s no accusation that he is a rogue operative here anyway.  He clearly was doing what he thought was the business of this administration, whatever he did. 

Do you have a sense that he knew that he was risking all by blaming the press for telling him about Valerie Wilson when, in fact, he got the information from half a dozen government officials? 

Did he know he was taking this risk?

SAUBER:  In retrospect, it does look incredibly risky and not particularly clever.  But at the time, no one thought there would be a special prosecutor.  Leak investigations are notorious for the inability of the Justice Department to get to the bottom of them.  Who knew? 

MATTHEWS:  I know what we knew.  And let me try this.

You represent Matt Cooper, a good guy, a great journalist. 

Could it be that Scooter Libby just thought, you know, press people keep secrets, they‘re very tough, especially the big-time reporters who cover the White House.  I can say anything about anybody that I told them and they‘ll going to have to basically be quiet about it.

Like Tim Russert, for example, would just have to say, hey I can‘t talk about that conversation.  Judy miller, I can‘t talk about the conversation. 

Your guy, Matt Cooper, I can‘t talk. 

That sense of the press shield being so strong.  Then you can say anything you want about a conversation with a reporter and they‘ll say, I‘m not talking.

SAUBER:  It‘s a good question, but a couple of things. Lewis Libby is a lawyer and he knew, like everyone else, that the Supreme Court has said there‘s no such privilege.

MATTHEWS:  Well, it‘s not on the books, but it‘s been honored. 

SAUBER:  It has been honored more often in the breach than not. 

MATTHEWS:  Really?

SAUBER:  I think so. 

And if I were Scooter Libby and I was on the phone with somebody that I hardly knew, it just seems to me a little risky to entrust my livelihood, my life, my freedom to somebody that I‘ve never met before and hope against hope that regardless of what Pat Fitzgerald is going to do, that person is going to keep secret forever and ever the conversation? 

(CROSSTALK)

MATTHEWS:  Yes.

And now he‘s going to have to go into the witness box and do battle with a reporter like Tim, and they‘re going to be battling over what the conversation was. 

That‘s going to be pretty interesting courtroom drama, right? 

SAUBER:  It‘s going to be very interesting. 

But I think Michael Isikoff made the point that the key witnesses in this case are going to be the three reporters with whom Mr. Libby apparently spoke. 

MATTHEWS:  This case—do you have a sense—we were all watching it, I was watching it in real time like you were all day today.  Did you—maybe you‘ve gotten good at reading Fitzgerald. 

Is this over for Karl Rove?  Is he basically in the clear here? 

SAUBER:  Well...

MATTHEWS:  A couple of people think he is. 

SAUBER:  Yes.

That‘s a fair question. 

The one thing I‘ve learned in dealing with Mr. Fitzgerald is that he tells you what he wants you to know and he‘s straightforward about it. 

So if the case was over, he would have said, the case is over.  And if the case isn‘t over, he wouldn‘t have said it. 

So the only thing I‘ve learned in dealing with Mr. Fitzgerald is he‘s very upfront and very straightforward, and I have to take him at his word. 

MATTHEWS:  OK.

He‘s not completely straightforward.  He uses phrases like “Official A” when he‘s referring to someone in the White House who is part of this intrigue.  And that person has been identified as a possible—by people around this table today as one of the—you might think that, that means, and tell me if I‘m right, or they‘re right, that, that means he is a target, this Official A, Karl Rove or someone else in the White House at this point now. 

SAUBER:  I think it is—no, I still think he‘s being straightforward in answer to your earlier question. 

MATTHEWS:  OK.

Who is Official A? 

SAUBER:  I suspect that it‘s Karl Rove. 

MATTHEWS:  Is he a target, still? 

SAUBER:  I think you have to take Mr. Fitzgerald at his word, that the investigation of Karl Rove is still open. 

And I think the use of the Official A in the indictment...

(CROSSTALK)

MATTHEWS:  Capital A. 

SAUBER:  ... is—at least it wasn‘t the scarlet A, it was the official A. 

I think it was in an abundance of caution to make sure that he wasn‘t being unfair to somebody who hasn‘t been indicted. 

I think you have to accept Mr. Fitzgerald at his word, that the investigation is still ongoing. 

MATTHEWS:  OK.

You‘re a criminal attorney, you‘ve got a client named Scooter Libby.  You get up tonight or tomorrow, over the weekend, he‘s facing 30 years, if you add up all the potential—it‘s all potential—but 30 years in hard time prison.  He says to you, “How can you get me out?” And you say, “Well, you ought to tell the truth this time and you ought to give them something they want.” 

What would it be the prosecutor would want; a plea bargain, you accept a year in Allenwood (ph), or you tell them something about your bosses that they want to get? 

Do you think this is a squeeze case, like a couple of the other cases that Fitzgerald is doing, to try to get a higher guilty person? 

SAUBER:  No.

I think this a straightforward prosecution. 

If Mr. Libby came in and said, “I have important information, I‘d like to trade it,” I‘m sure Mr. Fitzgerald would listen. 

But you don‘t go through two years and come to the end and charge somebody with five felonies just for the procedure or to squeeze them. 

MATTHEWS:  Well, how does a guy beat a rap like this, if you‘re Libby?  He‘s already resigned the White House, he‘s had to.  He‘s now humiliated, his family is humiliated.  He‘s going to spend months now probably suffering the approach of the trial.  He goes to trial—would you go to trial with a case like this or would you cut a deal? 

SAUBER:  I think Mr. Libby has already made that decision. 

If he was going to cut a deal, it would have been before today. 

MATTHEWS:  So he‘s going to go out—it‘s big casino now for him? 

SAUBER:  I think the decision has been made. 

MATTHEWS:  And has Fitzgerald made the decision to prosecute as heavily as it looks like he has; in other words, slam this guy with these five counts? 

SAUBER:  Absolutely. 

MATTHEWS:  He won‘t pull back? 

SAUBER:  I think Mr. Fitzgerald—the indication today is he thought this was a very serious crime, he thought it was more than a single count, and he‘s not going to accept anything less. 

MATTHEWS:  So for Scooter Libby the future holds two options:  one, go to prison for five years or so; or two, you walk and you‘re innocent and you‘re acquitted? 

SAUBER:  Those are the options. 

MATTHEWS:  Whoa. 

Anyway, thank you very much.  Great having you.

Dick Sauber, you speak with one tongue. 

Much more on the leak case.

This is HARDBALL.

We‘ll be right back. 

(COMMERCIAL BREAK)

MATTHEWS:  Coming up, Scooter Libby resigns after being indicted.  And Karl Rove remains under investigation.  What‘s the White House strategy from here? 

HARDBALL returns after this. 

(COMMERCIAL BREAK)

MATTHEWS:  Wow, it sounds like—what do you call them—gangbusters. 

Anyway, welcome back to HARDBALL.

We‘re joined by Dana Milbank of the “Washington Post,” who was in the courtroom today when the indictment was handed up. 

I love the way we do those.  The indictments go up and the condemnations go down. 

Let me ask you, Dana, you are a wonder at the anthropology of this town and understanding the way the sociology of Washington works today. 

If you had to draw this as a great drama, the indictments of Scooter Libby, how would you play it, as a—sort of a classic example of something about Washington? 

DANA MILBANK, “WASHINGTON POST”:  Well, I‘d actually suggest that the real figure—the indictment was about Scooter Libby today but the trial was really about Pat Fitzgerald. 

This was his day after 22 months of being the guy who would just say, “No comment” or “Good morning everybody” and not saying anything while everybody was raising questions about his motives, he finally got to come out and for an hour and six minutes he defended himself, I would say. 

He explained why he didn‘t go after the original statutes, he talked about the importance of truth, about his own integrity, how he is neither a Republican nor a Democrat. 

So I think he was really making the case for himself today and he did it pretty well. 

MATTHEWS:  Did he come across to you as an innocent watching him today at close range? 

MILBANK:  Hardly an innocent. 

But, yes, he did answer that question about how he was surprised by the ways of Washington.  But he‘s a savvy fellow.  He came out—you know, he was looking over our heads in the audience, straight at the TV cameras.  He kept making reference to people watching it from home.  He tried to come up with ways—he had this baseball metaphor about throwing sand in the umpire‘s eyes. 

He was ready for the charges that people were going—it was a prebuttal for the charges that are going to come from Scooter Libby and others saying that he is a partisan.  He was really ready for it.  I think he was savvy. 

MATTHEWS:  Yes, I‘m not so sure the partisan thing will ever work with this guy, because he seems almost beyond those concerns.  But let me ask you about his defense—his inability to get anyone on the main charge here for which he was given the commission, to find out who illegally outed a CIA agent, in this case, Valerie Wilson.  He used the baseball reference.  How did—well, repeat that reference.  Explain what he was doing there in explaining how he couldn‘t nail Libby or anyone else for that. 

MILBANK:  Well, it was a bit tortured.  He‘s explaining that somebody gets beaned and he‘s trying to figure out if it‘s intentional or an accident, but somebody is throwing sand in his eyes as the umpire.  Remember, last month it was John Roberts being the umpire for the Supreme Court. 

So he‘s saying, look, I set out to investigate this crime, but I couldn‘t investigate this crime because somebody was committing another crime.  So he wasn‘t necessarily saying I‘m not going to prosecute that crime, he was saying first things first.  And if, indeed, Scooter Libby is found guilty of this, he said that will be punishment enough. 

MATTHEWS:  You know how the White House keeps saying, or people around the White House, who really care about the president‘s political—his politics, say what he needs is another John Roberts.  Do you think we saw one today, this a likely pick for the Supreme Court associate justiceship? 

MILBANK:  You mean pull out Pat Fitzgerald? 

MATTHEWS:  Yes. 

MILBANK:  That would solve two problems at once, wouldn‘t it? 

MATTHEWS:  Get him out of action and get him on the home team. 

MILBANK:  Sure. 

MATTHEWS:  You don‘t think that‘s going to happen.  He did remind me -

didn‘t he remind you of John Roberts today, straight arrow? 

MILBANK:  He did.  Yes, he was—you saw he had a little bit of a Brooklyn accent, and he kind of a little bit more street tough.  But he wasn‘t quite as polished but he was really sharp. 

MATTHEWS:  “The unmistakable touch of the gutter,” as Jimmy Cagney said.  Anyway, thank you very much Dana Milbank.

MILBANK:  Thanks, Chris.

MATTHEWS:  Coming up, damage control.  What‘s the next stop for the Bush administration?  And a reminder for everyone, the political debate is ongoing at hardblogger, our political blog Web site, and you can now download podcasts of HARDBALL.  Just go to our Web site HARDBALL.MSNBC.com. 

(BEGIN VIDEO CLIP)

PATRICK FITZGERALD, SPECIAL PROSECUTOR:  This is a very serious matter, and compromising national security information is a very serious matter.  But the need to get to the bottom of what happened and whether national security was compromised by inadvertence, by recklessness, by maliciousness is extremely important.  We need to know the truth.  And anyone who would go into a grand jury and lie, obstruct and impede the investigation has committed a serious crime. 

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  Special Counsel Fitzgerald‘s investigation and ongoing legal proceedings are serious.  And now the proceedings—the process moves into a new phase.  In our system, each individual is presumed innocent and entitled to due process and a fair trial. 

(END VIDEO CLIP)

MATTHEWS:  Welcome back.  Ed Rogers, a Republican strategist and former adviser to the first President Bush.  You know, every once in a while, not often enough, the president is so noble.  And I was just watching that tonight, as we watched it in realtime, standing out there a big, bad day for this White House, and yet not taking any cheap shots at the prosecutor, because he‘s apparently clean as a whistle in terms of partisanship.  Don‘t you agree?

ED ROGERS, REPUBLICAN STRATEGIST:  Sure. 

MATTHEWS:  And paying tribute to the justice system and saying, you know, in effect it was a bad day for us, but the system works and we‘re going to keep rooting for this guy.  Just like any other citizen he‘s got to stand trial. 

ROGERS:  Yes, he was fair to Scooter who has been in his orbit for the last four years. 

MATTHEWS:  Generally fair.  He didn‘t defend him on the points of this charge, but generally fair. 

ROGERS:  He applied the law to him, innocent until proven guilty.  It was a classy thing to do.  Good for Bush.

MATTHEWS:  Now here is a chance for me to be classy.

ROGERS:  Please.

MATTHEWS:  Big day for Scooter—for what‘s his name. 

ROGERS:  Hey, it‘s binary.

MATTHEWS:  Because he would have been roasted tonight on all of these programs.  He would‘ve roasted because he is such a big deal.  And, you know, when they say, the bigger they are the harder they fall, had it been Karl Rove, he would have fallen hard today. 

ROGERS:  Hey, it‘s binary for him.  To get indicted is real bad.  To not get indicted is real good.  And so Karl is free and clear. 

MATTHEWS:  Do you a have sense like I did that it‘s over for him, that he‘s cleared? 

ROGERS:  Yes, I think he‘s free and clear.  Hey I‘ve never thought that Karl was in the crosshairs because the underlying crime would be very hard to prove.  And he was sort of late in the game.  Chronologically, if you followed it closely, Karl‘s discussions with these reporters were incidental.  And it didn‘t matter. 

MATTHEWS:  I think they‘re all loyal to each other, though, aren‘t they? 

ROGERS:  I hope so.

MATTHEWS:  I mean, I‘m not saying they‘re all thick as thieves but Karl is very loyal to Scooter from what I can tell. 

ROGERS:  Well, absolutely.  They‘re colleagues, they‘re in contact every single day. 

MATTHEWS:  How can they help him now, as he goes to trial? 

ROGERS:  They can‘t. 

MATTHEWS:  Can offer him a ...

ROGERS:  They can‘t.  At a personal level, they can be reassuring and encouraging, but there‘s no effort that can come from the White House that is of practical value to Scooter Libby right now.  Scooter is going to have to decide if he can take his chances as a Republican.

MATTHEWS:  Suppose the vice president sits in the witness chair and says let me tell you something you guys don‘t know in this trial, some information you don‘t know.  We were confronted with not only a threat to the national interest with regards to weapons of mass destruction, we were threatened with people coming out and saying there were no threats, we were wrong, and we did so belligerently and malignantly, maliciously.  My guy here defended me against those charges. 

ROGERS:  I like that lot.  I suspect he would do that.  There is—between now and one year or so, before a trial would actually come up, Scooter is going to have to decide how he feels about being a Republican leader, taking his chances in front of a D.C. jury.  So we‘ll see.  But it‘s a long way off. 

MATTHEWS:  It‘s tough. 

ROGERS:  It‘s very tough. 

MATTHEWS:  This town is totally Democratic. 

ROGERS:  It‘s very tough.

MATTHEWS:  And, you know, what about the vice president?  Would you recommend calling him as a witness, if you were a defense attorney? 

ROGERS:  He has to.  Absolutely, he has got to.  I mean, he can say what you said and he can say the truth.  And I think the truth will be a defense for Scooter.  I mean, here, again, no underlying crime.  And I can‘t figure out the selfish, nefarious motive that Scooter would have not to tell the truth. 

MATTHEWS:  Last night you were on this program.  You were right.

ROGERS:  Hey, thanks for saying so. 

MATTHEWS:  I won‘t say it again.  Anyway, HARDBALL will be back live in an hour at 7:00 p.m.  A different show at 7:00 tonight.  More on today‘s events in the CIA leak investigation.  And on Sunday at 9:00 Eastern, a HARDBALL SPECIAL REPORT.  That will be live too, on the CIA leak investigation. 

Right now, it‘s time for the ABRAMS REPORT with Dan.

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

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