THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
Guests: Michelle Bernard, Joan Walsh, Rep. Steven Israel, Rep. Zach Wamp, John Feehery, Mike Feldman, Clarence Page, Ed Gordon
CHRIS MATTHEWS, HOST: The transition goes Broadway. How did the off-stage business of picking a cabinet member jump before the klieg lights?
Let's play HARDBALL.
Good evening. I'm Chris Matthews. Leading off tonight: Post-season? Suddenly, we've got another campaign under way, Senator Hillary Clinton for secretary of state. David Broder of "The Washington Post" today warned that she would have her own foreign policy for the simple reason she has her own plans to become president. Tom Friedman of "The New York Times" warns that she can't truly be Obama's agent and foreign leaders will know it because of her own political purposes. Former president Bill Clinton says he's willing to adjust his dealings to let his wife get the job, but we learned today that he's got, quote, "negotiators," close quote, arguing over what documents, if any, and how to show the Obama people.
And all this is going on in the newspapers, by the way. And the big question is, why is that Obama, who conducted his business for two years out of the newspapers, and all of a sudden, these appointments-in fact, this one appointment is getting leaked to the newspaper while the other appointments don't even make it into the press until they're announced. Why is the whole show about Senator Clinton for secretary of state going on before our eyes in the newspapers? What happened to "No drama Obama"? Have the Clintons invited him to Broadway, or is this simply the problem of reconciling two giant political forces, the kind of thing that Abraham Lincoln was able to do so deftly?
Also, the heads of the big three auto makers had their hands today out on Capitol Hill. Of course, they came in on private jets. Here's a question for those in favor of a bail-out. With $25 billion in the pipeline and another $25 billion being requested right now, at what point should the government say, Enough, no mas? That's the big question for those supporting the bail-out. And for those opposed to the bail-out, here's a bigger question. How many jobs are you willing to see lost in the name of the free market, in the name of principle, two million jobs, three million jobs down the drain, or more? We're going to debate those sticky questions, and we're going to stick them to the people we brought on this show, members of Congress.
Plus: With the defeat of Ted Stevens up in Alaska, the Democrats now have 58 U.S. Senate seats with two more yet to be decided in Georgia, of course, and Minnesota. No matter what happens, the Democrats now control the White House and huge majorities in the U.S. Senate and the U.S. House of Representatives. Should Obama and the Democrats now pursue an activist agenda, like FDR or LBJ, or should they be more centrist, like Jimmy Carter's administration or Bill Clinton's?
And we thought you might like to see this before the election, but it came today, a tape from al Qaeda's number two, Ayman al Zawahiri. He called Obama-and this is his word-it's kind of an old term-"house negro," and he said he was, quote-this is what he says of Obama. This may help him. He's said he's the opposite of honorable black Americans like Malcolm X. And here's the question. Could that trash talk from the bad guys actually help Obama? We'll look at that and more in the "Politics Fix."
And in case you missed it, here's the "Tonight" show with Jay Leno. I was out late last night.
(BEGIN VIDEO CLIP)
JAY LENO, HOST: I've got to ask you something. Now, the critics gave you a lot of grief about-about...
MATTHEWS: Not like this!
LENO: No, not like this-about being too partial towards him.
MATTHEWS: Yes, well, I'm partial.
MATTHEWS: You got me. You nailed me.
MATTHEWS: You know, I've been watching politics since I was a kid and all the way back to the days of Kennedy and Nixon, and I've never seen anything like Barack Obama.
MATTHEWS: No one's ever been (INAUDIBLE)
(END VIDEO CLIP)
MATTHEWS: We'll show you more of that from the "Tonight" show or-
"Tonight" show on the "Sideshow."
But first: Should President-elect Barack Obama pick Hillary Clinton to be his secretary of state? Michelle Bernard is an MSNBC political analyst and Joan Walsh is with Salon.
Let me go first of all to Joan. Your thoughts on this. I want to ask you about a couple of things. Well, your thoughts, then we'll go to some of the other commentators. Your thoughts first.
JOAN WALSH, SALON.COM: My thoughts, Chris, I think she'd be a great secretary of state if Obama picks her. And what I mean by that is it's his choice, and if he decides that he trusts her and if he decides that he wants her in his cabinet, she'll do a terrific job. And I think all this second-guessing, especially by people who have until now respected Obama, is a little bit mystifying to me.
I also want to make a point about your lead-in. As I recall, and you're going to correct me if I'm wrong, didn't Andrea Mitchell break this story? And didn't she have two Obama advisers as her source last week? So there's this notion that the Clintons are leaking and it's all the Clintons' fault...
WALSH: ... that we've got this drama, and I don't think that's fair, either. So I think she's smart. I think she's...
MATTHEWS: Well, let's go to that . We'll go to that question.
MATTHEWS: That's a great question. Who's leaking all this information? I'm looking at "The New York Times" today, Joan-you may have seen it. Here's...
WALSH: I did.
MATTHEWS: ... Philippe Reines, who's Senator Clinton's press secretary, saying that one of the concerns they have from their end is they want to pay off $7.6 million in campaign debts. They also want to pay the money back that Hillary Clinton leant her campaign as a pre-condition to getting this job. That's being done in public. Bill Clinton's in "The Wall Street Journal"...
WALSH: I'm not sure Philippe...
MATTHEWS: ... front page...
WALSH: ... actually said that.
MATTHEWS: Yes, here-well, let me just read it...
WALSH: Did Philippe himself say that?
MATTHEWS: ... again. Let me just read this again here. Just a minute. Let me read this again. "Mrs. Clinton has $7.6 million in outstanding bills from the campaign, Mr. Reines said, not including personal loans she made to her campaign." I don't know. I'm getting it from him in the paper today, and that information's coming out from them.
Bill Clinton's talking about how he's going to smooth the path, what he's going to do in terms of changing his habits internationally in terms of his business dealings. There's a lot of discussions going on in public. "The Politico," which I know you respect...
WALSH: I do.
MATTHEWS: ... has a report today that the Clintons have named negotiators. They've got three people, including Bruce Lindsey. Here's some names. They actually have negotiators out there publicly deciding how to vet the information, what information to make public. And they say they don't want some of this information they give to Barack's people made public. They want some of it kept private. So they're already-and these are people like Cheryl Mills, you respect, Bruce Lindsey, Doug Band, that's the-I think that's the former president's body man. These guys are all out there publicly talking about what they're going to put forward to make this vetting thing work.
Here's David Broder, by the way. He's the most non-partisan in the business. Here's what he wrote today. "What Obama needs in the person running the State Department is a diplomat who will carry out his foreign policy. He does not need someone who will tell him how to approach the world or be his mentor in international relations. One of the principal reasons he was elected was that, relying on his instincts, he came to the correct conclusion that war in Iraq was not in American interest. He was more right about that than most of us in Washington, including Hillary Clinton." Now, that's Broder.
What do you think of-I want to ask-I got to bring in Michelle here.
MICHELLE BERNARD, MSNBC POLITICAL ANALYST: If I may interject? I mean...
WALSH: Go ahead.
BERNARD: ... I agree with Broder. I think that if he is-if the president-elect is seriously considering Hillary Clinton, he's going to have a huge problem with the people that put him in office. It borders on sheer lunacy!
When do you ever see in the history of the United States government people who are up for cabinet positions negotiating before the American public? I do ask, how does this end up in "The Washington Post"? We call him "No drama Obama." You know, he ran such a disciplined campaign. He's now the president-elect, and once again, all of the headlines in the news are about Hillary Clinton and Bill Clinton.
And again, I have to say to myself, Who is the president-elect? Is it Senator Obama-former senator Obama or is it Hillary Clinton? When does it end? She is a leader. She is not a follower. If she's going to be a good diplomat for the United States government, she has to be able...
BERNARD: ... to follow Obama's lead. And let's face it, Senator Clinton probably still is looking to 2012 and 2016. You can't do that and be an effective diplomat and also be an effective follower of the president-elect of the United States.
WALSH: Then he won't pick her. You know what, Michelle? Then he won't pick her.
But this is what I have to say. I think this is fascinating. While the world was swept by Obamamania last year, I confess I was a late swooner, OK? I had some questions about him, but he won me over. And now I'm sitting here on the sidelines, admittedly saying I trust Obama to make the right decision. If he picks her, it will be because he believes she will carry out his foreign policy. And if he doesn't pick her, there might be many reasons for that, but it'll be the right choice.
So you know, I think this whole idea-first of all, the Clintons are being blamed for leaking when it's not clear to me who's leaking what and who's talking about the negotiations. That might be Obama people who want to scuttle this thing. But as always, the default in any situation is to blame the Clintons. They're the ones at fault.
And I just trust Obama...
BERNARD: Well, I think...
WALSH: ... to look at this-I also think during the primary campaign, there was not an inch of daylight between their foreign policies. They both-they both had a lot of political incentive to exaggerate the differences. He, you know, considered her a hawk and she was wrong about Iraq and he was right. I agree on that. But basically, they would have had the same foreign policy.
So if he sees something there that he believes he, as our president, can use and can capitalize on, I say more power to him. It makes him look like the strongest man in America, barring none.
BERNARD: See, I don't think this is a question of whether or not people trust Barack Obama's judgment to pick her...
WALSH: Well, I do.
BERNARD: ... or not pick her as secretary of state, but there are a lot of questions about the Clintons. There is always drama. And we had a very long...
WALSH: There no questions...
BERNARD: ... primary season...
WALSH: ... about the Clintons. They've all been answered.
BERNARD: There are always questions about the Clintons. We had a very long primary season here in this country. It was very difficult. The you know, president-former president Clinton race-baited. There were so many questions...
WALSH: He did not race-bait.
BERNARD: ... that went on all throughout the primary...
WALSH: You and I disagree...
BERNARD: Well, as an African-American...
WALSH: You and I disagree on that.
BERNARD: ... I can tell you that I personally felt horrified when I saw the comments he made about Jesse Jackson winning whichever state it was, whether it was South Carolina or North Carolina, and as an African-American, it was race-baiting! It was disgusting!
WALSH: I respect your opinion, but I disagree.
BERNARD: And one of Hillary Clinton's biggest problems is if she becomes secretary of state, Bill Clinton comes along with her. Whether he gives up his foreign speeches or not, he becomes part of the equation, and it will minimize her effectiveness.
MATTHEWS: OK. I want to try something here because it is-gets down to judgment. I'm with Joan on this one. And I'm-I'm a-I don't know what to say. Let me just tell you, Joan, it seems to me when you're with Hillary Clinton-you've had private interviews with her. I know I've had meetings with her. And when you are with her, she is absolutely stunning intellectually, personally, whatever you want to throw in the bix (ph). Charm, humanity, whatever, it's all there.
MATTHEWS: I can see that they've established something of a relationship. There's one thing you've got to admit, Michelle. Whatever is going on here, he's trusting her with the biggest job of his life, which is to end the war in Iraq, prevent a war with Iran, and he's trusting her as his lead person to do that.
WALSH: Why would he do it?
MATTHEWS: Why do you think he is trusting her? Because he clearly is playing with the idea-clearly, he's saying to us, I want her to have this job. He wouldn't have let this balloon stay afloat so long. Why's he doing it?
BERNARD: Well, I don't think that he's telling us that he wants her to have this job. I think he's saying that he's thinking about it. He's floating it out there, and maybe he's seeing how the public is going to react to it. I'm not convinced...
WALSH: That doesn't sound like Obama.
WALSH: ... that she's his top choice for secretary of state. I don't know-I don't know how to explain it, but what we do know is no announcement has been made. You know, we've heard about other people...
BERNARD: ... no announcement has been made.
MATTHEWS: Let's take an analytical question. Let's take it-forget Hillary for a second. Forget Barack Obama. Can someone be secretary of state who has presidential ambitions down the road? Joan first. Is that conceivable?
MATTHEWS: Because you're playing to the constituencies that you need to get elected. That's not necessarily playing to the policy the president wants.
MATTHEWS: You know that. You got to keep people...
WALSH: I know that, Chris.
MATTHEWS: ... happy if you're secretary of state and you want to be president.
WALSH: I think...
MATTHEWS: Where as if you want to be just a good secretary of state, you just got to keep the president happy. That's a different job description, isn't it.
WALSH: It's-it's a...
MATTHEWS: Different boss.
WALSH: It's a different job description. However, you can imagine a scenario in which being a fantastic secretary of state, which means representing your president, leads you to become the president. You can imagine it. The two things are not mutually exclusive. She would have to do an amazing job, which would mean representing his interests without any daylight between them, without anybody ever questioning...
WALSH: ... who she speaks for. If she did that, she could become president.
WALSH: If she failed it and if she undermined him, she would really undermine her chances of becoming president, in my opinion. What an awful thing to do.
MATTHEWS: Well, let me render my judgment here. And I've been tough on the Clintons for a long time now, maybe 10 or 20 years.
MATTHEWS: And you are chuckling, Joan-both Clintons. But let me say this. If she doesn't do everything she can and Bill doesn't do everything he can to get her this job and for her to get this-they're crazy. This is the greatest job of our time because following Bush in foreign policy is the greatest act you can do because he blew it. He got us into a war we shouldn't have been in. We're on the danger of coming into another war. And it takes a really smart person and a president and his secretary of state working together to keep us down...
MATTHEWS: ... the road towards ultimate peace, in the Middle East especially, not even talking about Darfur and Zimbabwe and all these other crazy parts of the world. We have a world that's getting overcrowd. It's getting hotter, with every ethnic group wanting to fight with every other ethnic group and it's balkanizing. In every country, they want their own ethnic power, their own hegemony. And everybody wants to fight with each other. And we got to be the stud duck. We got to make it work. I'm sorry. That was gender-specific.
MATTHEWS: Give me a better word, Joan. We have to be the strong force in the world for good and peace, and it's a hell of a job opportunity. I hope Hillary Clinton, if she wants it, gets it. It's a great opportunity, and I wish her well in this regard. But I do think these questions that have been raised have been damn legitimate, and given the Clintons' track record, they better damn well have been asked. But on the road (ph), as you point out, Joan, either you trust Barack or you don't.
MATTHEWS: Have I said it right, Joan, this time? I'm trying to learn.
WALSH: I think you said it very well this time, Chris.
MATTHEWS: I'm trying to learn because your respect is very, very important to me, Joan Walsh.
WALSH: Thank you, Chris.
MATTHEWS: Thank you, Michelle Bernard. I'm sorry for taking sides against you. Tomorrow night, I'll be with you.
Anyway, coming up: Executives on the big three auto makers are back on Capitol Hill with their hands out. By the way, they come in private jets at 20,000 bucks per ride. They come in and they ask for money. They're not taking a salary cut. In fact, the top flack, the top press secretary for GM says they're doing swimmingly, the bosses. They're the greatest management team we've ever had. We got to get into this! This is incredible. They're acting like beggars out in the street, but they want us to treat them as if they wearing high hats and tails.
Should they get all this loot? Should our tax dollars bail out the big three, these sagging companies, or should they be forced to go into bankruptcy? It is a hot question. And you got to look out for that guy working right there. Forget the big shots, think about the guys putting the cars together.
You're watching HARDBALL, only on MSNBC.
MATTHEWS: Welcome back to HARDBALL. The debate now over whether American auto makers should receive another $25 billion in bail-out heated up today as the top executives from the big three testified in Congress after flying in yesterday on their private luxury jets at the cost of 20K per jet. And all three jets, by the way, traveled separately.
Here's what New York congressman Gary Ackerman-this guy is a real piece of work. I love Gary Ackerman. Here's what he said to these guys when they showed up.
(BEGIN VIDEO CLIP)
REP. GARY ACKERMAN (D), NEW YORK: There's a delicious irony in seeing private luxury jets flying into Washington, D.C., and people coming off of them with tin cups in their hand, saying that they're going to be trimming down and streamlining their businesses. It's almost like seeing a guy show up at the soup kitchen in high hat and tuxedo.
(END VIDEO CLIP)
MATTHEWS: It's like having a guy show up in the soup kitchen in high hat and tuxedo! Well, that's a big question. Does the American auto industry deserve the bail-out, and are these three jokers doing the job of getting them one?
Let's bring in Democratic congressman Steven Israel of New York state and Republican congressman Zach Wamp of Tennessee. Gentlemen, thank-
God, you're close together. I guess we only had camera to work as part of our cost savings.
MATTHEWS: Let me start with you, Mr. Israel, Congressman. If you want to bail them out, is there a limit to how far you'll go, $25 billion, call you $25.5 billion, go $50 billion (INAUDIBLE) be going to $100 billion. If they don't pay their bridge loan, do we keep giving more money? What's the story?
REP. STEVE ISRAEL (D), NEW YORK: Well, I don't want to give them a penny unless the American people get something in return. I don't want to give them a bail-out. They need a jump-start. I don't want to give them a blank check. What they need is-to jump-start the economy, they need to reverse fundamentally bad management decisions by these CEOs who just flew in. They've spent the past 30 years building the wrong cars for the wrong people at the wrong time.
I'm willing to give them some help, but here's what I want in return. I want a commitment from them that they're going to start installing flex-fuel chips in cars so that we're not-we don't have to depend on oil to get us around. I want a commitment that they're going to advance research on new batteries. I want a commitment that they're going to turn over the current fleet and replace it with new energy-efficient vehicles. And until we get those kinds of commitments, I'm not interested in giving them a bail-out.
MATTHEWS: Well, H.L. Mencken once said, Never argue with someone whose job depends on not being convinced. Your talking to CEOs who don't want to hear that they've blown it.
Now, here's what George Will, a free marketeer, had to say today. "Nothing has"-he's quoting the chief flack for General Motors, the chief press guy. This is what he put out as his statement. It's an incredible statement. This is GM talking. "Nothing has changed relative to the GM board's support for the GM management team during this historically difficult economic period for the U.S. auto industry."
And then George Will goes on to say: "Nothing, not even the evaporation of almost all shareholder value?"
They are standing up for the quality of management. They're saying everything is going swimmingly, Congressmen. It doesn't sound like they will buckle to your call for greater management control.
ISRAEL: When we have the funding that they are asking for, they can't expect us to just give them a blank check without the kinds of conditions we want.
Look, there have been two failures of management here. There's been a failure in management in Detroit and there's been a failure in management in Washington, with administration policies that did nothing.
ISRAEL: And the victims should not be the autoworker in Rochester or Buffalo or the service guy in a car dealership on Long Island.
MATTHEWS: OK. Stay there for a minute, because I'm going to come back to you with a question, which is, if they fail to pay this money back, if they blow it again, will you go-will you do it again and give them more money next year, like an enabler?
Let me go to Congressman Wamp here.
If you are a free marketeer, sir, and you oppose the bailout, how many jobs are you willing to see lost in the interest of free market principle?
REP. ZACH WAMP ®, TENNESSEE: Well, first of all, I don't think are going to go out of business without the money. I think they will probably go into Chapter 11. And, as Mitt Romney says in an editorial today, that's actually where you reorganize. That's where you rework your labor agreements. That's where you come and cut money. That's where you get the management off their tail to make these changes.
The American people don't believe that we will be able to hold them accountable, because, over the last two months, since the last bailout, they have seen that managed so poorly, that it rivals the management of our response to Katrina.
So, the government confidence is not there with the people. They are weary of bailouts, any more bailouts, any new money. They don't believe it's going to work, because this administration came and told us that the last bailout was necessary. And it's 60 days later, and only a portion of the money has even got into the credit markets.
So, we don't have a good track record. Steve is right that there's two failures here. But giving them more money is a bad idea, and that will have a counter economic stimulus effect by putting more government money out there, with no guarantee that changes are going to follow. And, as Thomas Friedman says, why reward the guy who have been brain-dead on what they need to do for a long, long time. This is asinine.
MATTHEWS: So, you're willing to take the risk of bankruptcy because the CEO of GM...
WAMP: They will end up in Chapter 11. They will come out of it if they're any good.
MATTHEWS: You're-you're willing to take that risk? You're willing to take that risk?
WAMP: If they are any good, they will come out of it. People go into Chapter 11 and out of Chapter 11 in this country all the time. That's what it's created for. I'm not saying Chapter 7.
MATTHEWS: Suppose they are not any good? Suppose they are not any good?
WAMP: Well, if they're not any good, then competition is going to bring the best cars to the market.
Volkswagen just invested in Tennessee, in a right-to-work state, at a low cost, with less health care.
WAMP: Why should we prop others up, when others companies can compete in this marketplace?
MATTHEWS: Well, that's the question to you, Congressman Israel.
Should the auto industry, including its-its-its labor that builds these cars, should they agree to work for the same amount of money workers work for in right-to-work states, where they don't have unions? Or is that just too hard a price-too high a price to pay to get the bailout?
ISRAEL: In any scenario, there's going to have to be sacrifices by everybody, by labor, by management, by everybody.
But let me just say one thing on the bankruptcy issue. And this is important. The auto industry is not like other industries. If the auto industry goes bankrupt, are you willing to buy an American car not knowing whether you're going to be able to get a fan belt for that car in two years, a replacement part, whether the warranty is going to be protected?
ISRAEL: When an airline industry goes bankrupt, people still buy tickets on those airlines. When the auto industry goes bankrupt, there are no options.
And that's why I'm not saying bail them out, by any stretch of the imagination. I'm saying give them a jump-start, require that they begin making the technological transformation that Iran is making by installing flex-fuel chips, that Brazil is making, that we should make.
MATTHEWS: OK. Here's what I'm worried about. Gentlemen, here's what I'm worried about, the total impact of a major bankruptcy in one of our major firms at this point.
The stock market today dropped dramatically below 8000. It's at a five-and-a-half-year low. The impact on national morale of the failure of the Big Three or one of the Big Three, it seems to me, could be shattering.
For Americans not to know we're making our own cars anymore might make us start putting our money in our piggy banks, and taking it out of the stock market, and take it out of any risky investment. Aren't you afraid of that, sir, you first, Mr. Wamp? Could it be that Americans are right on the edge now of a fearful race from risk, and they will be even more fearful of risk if the auto industry fails?
WAMP: At some point, we're going to hit bottom, somewhere between here and next April, I hope.
But, back in September, we created all this fear. Paulson and the team, the administration-he's right about this-they made it worse by creating all the fear. Oh, my God, the sky is going to fall if we don't do this.
The people that we represent don't believe this is going to happen. They believe they will go into 11, come out of it. Who is going to guarantee the reforms? These guys need to be making cars that can compete with Toyota, not asking us to prop them up.
And, Chris, at some point, they have got to bite the bullet. And Thomas Friedman says it. Art Laffer says it. Mitt Romney says it. A lot of people from various perspectives are saying, it's time to let these people...
WAMP: ... learn the lesson the hard way.
MATTHEWS: You know, I wonder. I wonder if there is not a intramural battle going on here between the unionized states and the right-to-work states that don't have unions.
Could that be the battle here, Congressman Israel? Are you fighting for the rights of unions to collectively bargain, even if it means higher costs for labor, at the expense-and against people who are trying to get cheaper labor down in the South, for example?
ISRAEL: I am fighting-I am fighting for two things. We have a profound economic crisis in America and we have a profound energy crisis in America. And this is an opportunity for us to solve both problems by jump-starting the auto industry with new technologies, not to bail them out, but jump-start them. That's what we have got to do.
MATTHEWS: OK. OK. We're going to see.
I'm-I'm still trying to get the answer. How big of a price are we willing to pay, how many unemployed are we willing to suffer if we don't pay the price? These are tough questions.
ISRAEL: They are.
MATTHEWS: And you guys in Congress and women in Congress are going to have to answer those questions.
Thank you very much, Congressman Steve Israel of New York and Congressman Zach Wamp of Tennessee.
MATTHEWS: Up next: If Hillary Clinton-is she still-well, does Hillary Clinton still have presidential ambitions? If she does, is the right person to be serious of state? That has been raised as a question. Can you be secretary of state if you are running for higher office, or will that get in your way of serving the president and his policies, who is already elected president? We are going to explain that next in the "Sideshow." That's a hot topic right now.
You're watching HARDBALL, only on MSNBC.
MATTHEWS: Back to HARDBALL. Time for the "Sideshow."
In case you missed it last night, here's "The Tonight Show" with a few thoughts about the election we have just been through.
(BEGIN VIDEO CLIP, "THE TONIGHT SHOW WITH JAY LENO")
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": Now, I have got to ask you something. Now, the critics gave you a lot of grief about-about...
MATTHEWS: Not like this.
LENO: No, not like this.
LENO: About being too partial towards...
MATTHEWS: Yes. Well, I'm partial.
LENO: Yes, although...
MATTHEWS: You got me. You nailed me.
LENO: Yes, OK.
MATTHEWS: You know, I have been watching politics since I was a kid, and all the way back to the days of Kennedy and Nixon, and-and I have never seen anything by-anything like Barack Obama.
MATTHEWS: No one has ever been as inspiring.
(CHEERING AND APPLAUSE)
MATTHEWS: And I said so when I first saw him in-out there in Springfield, Illinois, when it was three degrees below zero. And there was this young African-American guy walking out on this stage with his beautiful family. And there was the capitol where Lincoln was once a legislator. And there was the place where practiced law across the street.
And I said, imagine if he could see this. It was just stunning to me from the time it started. I think he is a remarkable political reality.
MATTHEWS: And we-the American people went for him.
And the stunning thing is, we all thought that people wouldn't vote for him because he was black, and a lot of white people would say they were going to vote him and didn't. You know what happened? It was the other way around.
MATTHEWS: In Pennsylvania, the latest polling, I just found out, was 3 percent for him. He won by 11.
MATTHEWS: So, 8 percent, almost one in 10 of the people, didn't say they were going to vote for him, and, at the last minute, said, I want to give this guy a shot.
And they didn't brag about it, didn't say, I'm a big liberal or anything. They just did it quietly.
MATTHEWS: And I think that's a remarkable thing about our country.
We're better than we think.
MATTHEWS: You know?
LENO: No, I agree. I agree. I agree.
MATTHEWS: And I think it's...
(END VIDEO CLIP)
MATTHEWS: Speaking of election night winners, there is one Capitol Hill newbie out there, a newcomer who is out to prove that frugality has come to Washington.
Check this out. U.S. congressman-elect Jason Chaffetz arrived in D.C.'s airport this week with a cot. Look at it, wrapped in duct tape. The new member tells "Politico" that he plans to sleep in his Capitol Hill office and shower at the House gym, instead of renting an apartment in D.C. He's not the only member who does this, actually. About 40 members of Congress sleep in their offices. So much for the thrill of victory.
Time now for the "Big Number," which relates to the current discussion about Senator Hillary Clinton possibly becoming our next secretary of state. How much years has it been since a secretary of state went on to be elected president?
Well, five of them did in the first century of our country's history, including greats, like Thomas Jefferson, James Madison, John Quincy Adams. But the last to pull it off was James Buchanan, who was elected back in 1856. That makes it 152 years, a century-and-a-half, and more, since a secretary of state was elected president of the United States. That's tonight's "Big Number."
Up next: The Democrats have won the White House and big majorities in both the House and the Senate, but now comes the real test, the acid test. Can they get things done without Republican to kick around? They don't need Republicans to pass bills. They need to get the job done. Can they seize the moment and do big things, or will they be too careful, too squeamish, too small?
You're watching HARDBALL, only on MSNBC.
SHARON EPPERSON, CNBC CORRESPONDENT: I'm Sharon Epperson with your CNBC "Market Wrap."
Stocks plunging again in the final hour of trading. The Dow Jones industrials finished down 427 points, falling below 8000, its lowest close in five-and-a-half years. The S&P 500 shed 52 points, and the Nasdaq down 96, the S&P and Nasdaq also closing at five-and-a-half year lows.
The heads of the Big Three automakers were back on Capitol Hill for a second straight day, pleading for $25 billion in emergency government assistance. With the current rescue plan apparently stalled in Congress, Republicans and Democrats are reportedly working on a revised plan.
Meantime, consumer prices plunged 1 percent in October, the biggest monthly drop on record. The worry is that falling prices will hurt various industries and contribute to a downward spiral in the economy.
And new home construction fell another 4.5 percent last month, also dropping to a new record low.
That's it from CNBC, first in business worldwide-now back to
MATTHEWS: Welcome back to HARDBALL.
In this election year, Democrats increased their majorities and the Senate. Of course, they took the White House. Are there pieces-are the pieces in place now for President Obama to make this a transformative presidency?
You know, he talked about that when he was running for president, the difference between a president who does little things, symbolic things-he said that Clinton did that, Carter did that-and president like LBJ, and FDR, who does big stuff.
Joining us to talk about the question of bigness in this new administration, and, to some extent, guts, Mike Feldman, who worked for vice President Al Gore and the Clinton-Gore team, and, of course, Republican strategist John Feehery, who is a good sport. He comes here. He was communications director for Dennis Hastert, who, by the way, left office clean and happy, which is a good-good piece of work by you.
JOHN FEEHERY, REPUBLICAN STRATEGIST: Absolutely.
MATTHEWS: Let me-notice how I say those things?
MATTHEWS: Let me ask you, Mike Feldman, it seems that this guy ran for president, Barack, with big promises. He said, I'm going to be the change that you can believe in, middle-class tax cuts, energy, independence from oil, real health care for everybody, maybe not mandated, but everyone can have it, climate change, deal with that, big stuff, WPA-type, Roosevelt kind of jobs programs, infrastructure, putting the roads together, bridges back together, big time.
Is he going to do it?
MIKE FELDMAN, DEMOCRATIC STRATEGIST: I think he is.
And I think bold, transformational change does not necessarily mean winning on a party-line vote. So, I think that's why you see him meeting with John McCain. That's why you see him reaching out to Republicans. That's why you see him showing that he is going to govern from the center, because big, bold, transformational change doesn't pass-it doesn't pass...
MATTHEWS: You are totally in tune with-you must have read this.
This is what Rahm Emanuel, the new ramrod...
FELDMAN: No. Well, Rahm is a very smart man.
MATTHEWS: No, you are totally in line.
MATTHEWS: You-he has just got the talking points. This is what Rahm Emanuel said.
The good news about the terrible economy is that if you-there is a silver lining. It is that the problems are so big right now that they lend themselves to ideas that both parties can go for, in other words, that we are in such a ditch, that even Republicans are willing to say, let's try some of these big moves, like jobs bills. Let's try something like energy, green jobs, five million. Let's put people to work.
What do you think John, being the Republican here?
FEEHERY: Show me the money. Where are you going to get the money, especially...
MATTHEWS: Borrow it...
FEEHERY: Borrow it?
MATTHEWS: ... same place we got the money for Wall Street.
FEEHERY: Borrow it? And, then, at some point in time, you're going to hit the-we're going to be bankrupt.
Look, Congress is already running into this. This is why they're...
MATTHEWS: You need to handle this one.
FEEHERY: Seven hundred billion dollars...
MATTHEWS: How come, whenever business is in trouble, magically, these checks come out of nowhere? As Mario Cuomo said, where did that $100 million come for the S&Ls?
Where does the $720 billion come from for the big banks in New York, and, yet, when you want to do health care, oh, we are out of money?
FEEHERY: Chris, you know this-you know this as well as I do.
MATTHEWS: Where does it-well, where does it come from?
FEEHERY: When you're in government, you look at the money. You actually have to figure it out. And you just can't keep printing it out.
MATTHEWS: Well, why do they do it for the big guys?
FEEHERY: For universal health care...
FEEHERY: Hundreds of billions of dollars, trillions of dollars.
MATTHEWS: Well, how can they do that whenever they have the...
MATTHEWS: I sound like a populist.
Mike, that is your job.
MATTHEWS: It seems like, every time rich people get in trouble, we have got money. And, every time poor people get in trouble, we can't afford health care; we're broke.
FELDMAN: Yes. But that's why...
MATTHEWS: And, by the way, if you want a war, there is always money for a war.
FELDMAN: That's why, by the way, each of these issues, you hear the president-elect now talking about them in terms of jobs.
OK, health care-lowering the cost of health care is going to help small businesses hire more people. That's a fact. The energy and economy, the green economy, that's a stimulus. Infrastructure, again, putting people back to work, each one of these issues is going to be talked about in terms of job creation and helping the middle class. That's-that's what you...
MATTHEWS: So, you can-you can-we can write the checks? The government can write the checks?
FELDMAN: Well, look, it's an investment.
And, by the way, at a time right now when most American people who are looking at that-that little box in the corner...
MATTHEWS: See? See?
FELDMAN: ... they want to see that investment.
MATTHEWS: So, why is he wrong?
FEEHERY: You know as well as I do that the money is important. You have to find the money and Barack Obama has already talked about raising taxes to pay for this. At some point in time, the economy is not going to allow all that.
MATTHEWS: He said his tax cuts will have a net reduction effect. He said the purpose is not to redistribute-that's he's been saying since the election-it is to give tax cuts to the middle class as a net reduction.
FEEHERY: Tax cuts for the middle class are probably going to go out the window, because you have to pay for everything else. You have to pay for this bail out. You have to pay for everything. I hate to be the-
MATTHEWS: I love the way the Republicans-you guys run deficits for eight years and then you come in say Democrats-
FEEHERY: Now you can't spend any more money because we are out of it.
FELDMAN: I'm proud of the fact that the Democratic party is now thought of as the party of fiscal responsibility. We're pleased to take that mantle. Listen, when I left the White House at the end of the Clinton-Gore administration, I think we had created 23 million new jobs.
FEEHERY: Thanks to Denny Hastert and the Republicans in Congress.
FELDMAN: We were happy to work with them.
MATTHEWS: Isn't it Cheney who said that deficits don't matter?
FEEHERY: I don't know. He's probably still in the White House. Listen, deficits do matter after a certain point. We're reaching that point.
MATTHEWS: Ronald Reagan said the deficit is big enough to take care of itself. You guys are pretty blithe and have a good time about deficits when you're in office. It's when you are out of office, you complain about them.
FEEHERY: I'm not complaining. I'm saying the Democrats are going to be running everything. They're going to be running into some big budget realities. They're going to find ways-if you are in any kind of businesses, you are going to be skinned a little bit for everything. You have to deal with this deficit.
MATTHEWS: Let me ask you a political question. Get out of economics for a second. Barack Obama said I'm going to do the following things-he keep saying it. I am going to do something on health care. He's got Ted Kennedy working on it and Baucus working on it, perhaps Senator Clinton if she stays in the Senate.
He's going to do something on middle class tax cuts, an absolute oath he's taking. There is going to be a middle class tax cut for 90 percent of the people. He's going to create five million green jobs. He says so. If he doesn't do it, you guys will welt him. You'll kill him.
FEEHERY: The first thing he's got to deal with is an economic crisis. That's the first thing he's going to deal with. From there, everything else flows. Campaign promises are campaign promises that usually are ignored as soon as you get to be president. Now he has to deal with reality. He has to deal with reality with a Democratic Congress who has their own spending plans. This is going to be very hard. This is not going to be easy, Chris. You can't just print this money.
MATTHEWS: You're trying to bore us to death, aren't you? This is the kind of boring-
FEEHERY: Show me the money!
MATTHEWS: You guys are in office, the president of the United States, President George W. Bush, who is still our president, didn't veto a single spending bill. He signed every spending bill for eight years. Now you are saying the new president should not sign these bills.
FELDMAN: I am going to make you a prediction right now.
MATTHEWS: You guys are boring principled people when you're out of office. When you are in office, it's one hot check after another.
FEEHERY: I have become fiscally responsible.
MATTHEWS: I'm glad you admit your two face, your forked tongue here.
FELDMAN: I would bet that Barack Obama moves boldly, moves quickly on all these areas you just mentioned.
MATTHEWS: Why does he have to do it?
FELDMAN: Because the country is ready and that's what we need.
That's what he promised he's going to deliver.
MATTHEWS: Rahm Emanuel, who bosses around the Democrats say this, the times are so bad that even Republicans will join.
FELDMAN: They will, I bet they will.
MATTHEWS: Especially Republicans afraid to get beaten next time.
FEEHERY: It depends on the issue. If it's SCHIP, yes. If it's Medicare, some will. A big plan universal health care plan that hits small businesses the hardest, that is going to be a tough one for them to take. It's going to be hard for the Blue Dogs. That guy from Utah who's sleeping on the cot, that's going to be hard for him to take. There are going to be a lot of blue dogs worried about the fiscal responsibility issue and a lot of them campaigned on that.
MATTHEWS: What is this? You worked on the hill more recently than I did. What's with the 40 guys, mostly men, living on their cat. They do get 160 or 170 a year. Can't they afford a small basement apartment somewhere and roommate with somebody?
FEEHERY: A lot can't.
MATTHEWS: Tuition bills.
FEEHERY: Tuition bills, kids going to college.
MATTHEWS: Anyway, thank you Mike Feldman, the big spender. John Feehery, who has become a tight lipped, tight pocketed Republican now that he is out of office. Up next, al Qaeda's number two, what a sweet heart he is, takes a racist swipe-it's not racist. He's trying to be clever about American racial development there. Whatever. He is taking a shot. He's trying to put this guy down again. Maybe it's going to help him. You want to have some enemies in this world. Pick your enemies. Barack has got some good ones out there. Could this criticism actually help Barack Obama to be called something bad by the bad guys?
The politics fix is next. We're going to talk about it. This is HARDBALL, only on MSNBC.
MATTHEWS: We are back now for the politics fix. We're joined by the "Chicago Tribune's" columnist Clarence Page, and Ed Gordon, host of "Our World" with Black Enterprise. Will this bad guy, al Zawahiri, one of the number two guys-in fact, he is the number two guy in al Qaeda. He is a real bad guy. He's put out the following statement. I like the way they put these communiques out to stick it to the new president of the United States. Quote, "that's why it wasn't strange that Malcolm X was killed. While you have climbed the rungs of the presidency"-he's talking to Barack Obama-"to take over the leadership of the greatest criminal force in the history of mankind"-that's us-"and the leadership of the most violent crusade"-I guess that's Iraq-"ever against the Muslims and in you and Colin Powell, Rice"-that's, of course Condoleezza Rice, the secretary of state-"and your likes, the words of Malcolm X may Allah, have mercy on him, concerning house Negroes are confirmed."
So has picked up on some of the terms of the '60s here.
CLARENCE PAGE, "THE CHICAGO TRIBUNE": Yes, he's played some Malcolm according to the report, some Malcolm X recording there, because Malcolm had a whole riff about house Negroes.
MATTHEWS: Do you think he read the autobiography by Alex Haley? Do you think he got all the way through it?
PAGE: I think the important thing here, Chris, is where is bin Laden? We haven't seen Osama bin Laden is so long. Why are we listening to number two here? This tends to confirm the rumors that he is dead, that he died of a kidney failure, et cetera, up there in the hills of Pakistan. The other thing is I think Zawahiri-thank you very much-Zawahiri-we've been practicing this-I think he is jumping the gun. For one thing, Barack Obama is so widely respected and celebrated throughout the third world right now, throughout Africa, where there a muchos Muslims. He is now immediately castigating Obama before he has even taken office. Obama wants to pull out out of Iraq.
You would think if al Qaeda wants to win hearts and minds in the Muslim world, they would not be jumping on Obama now.
MATTHEWS: You know why. Ed may have a theory. Ed, why are they dumping on him? Why are they doing the trash talk before he gets the presidency?
ED GORDON, BLACK ENTERPRISE: I think what they are doing-the interesting question for me, Chris, is who are you talking to when you use phrases like house Negro and the like? Are you in fact talking to United States sympathies? Are you looking to shore up your base and rally them? I'm not really sure who he is speaking to.
I think they didn't want to get lost without being able to have a preemptive strike here. He also said that-while not making a direct threat, that he will face, meaning he, Barack Obama, a jihad awakening, without specifics there. The interesting point to me is, who are you speaking to?
MATTHEWS: You know what else he missed? He missed the big one. Barack Obama wasn't appointed by some white guy. He was elected by the people of the United States, all of us. He beat a lot of white people. It is not some showcase appointment we're talking about.
GORDON: I think that's part of it, the reason I ask that question. The idea that I think what they are doing there is trying to find a wedge, if you will, some kind of racial divide to throw in there, to say to African-Americans and like-minded people that this is a house Negro. He is just a puppet for the white guys. You put him in, but he is not going to really do what you want.
MATTHEWS: I thought they would go the other direction. I thought they would said he was a fallen away Islamic guy, some sort of apostate or heretic, and therefore attack him on those grounds. I guess, they're acknowledging that he is a Christian and they're not playing that card.
PAGE: They're acknowledging reality. You don't inherit Islam.
MATTHEWS: I thought they might try that because of his name.
PAGE: It would be theologically inaccurate and would further ruin their credibility. Again, he's jumping the gun. Why not wait until Obama is in office and has done something like maybe slow up his time table for withdrawal from Iraq. Then jump up and say, there you see. He is just like Bush or whatever. Right now, it is just-I think, it damages al Qaeda's credibility, which, by the way, is in question in many parts of the world right now.
GORDON: With the pictures that accompanied the text, they did try link him with a strong Israeli relationship. And there is that one, if you see the picture there on the screen now. I think he is trying to throw as much spaghetti on the wall as he could and see where it would fall.
MATTHEWS: I think they need a new Tokyo Rose, myself. We'll be right back with Clarence Page. They have to get their propaganda right. We'll be right back with Ed Gordon. I think we'll agree on this one, bad move by the bad guys, which is good for the good guys. We'll be right back with the politics fix and talk about President Clinton, Senator Clinton, and President Elect Barack Obama. Can this team play ball? You're watching HARDBALL, only on MSNBC.
MATTHEWS: There you see former President Bill Clinton down there campaigning for Jim Martin, the Democratic candidate for Senate down there against Saxby Chambliss. There he is. There is Bill Clinton, still working the political trail there. Elections will two weeks from tomorrow.
We're back talking to Clarence Page and Ed Gordon about the whole question of the Clintons coming back into our national life at the highest level. Clarence, I haven't heard your views. I've been reading David Broder, Tom Friedman, I heard David Ignatius had a thought. All are down on this idea. They believe there is real conundrum in a Senator Clinton secretary of stateship. What do you make of it?
PAGE: I think, as far as diplomatically, it is a bad choice. Politically, it is a good choice for him. It gets her inside the tent, so to speak. It's a rose thrown to the Hillary Clinton supporters, like a consolation prize, in his own constituency. As an international diplomat, we really don't know much about her foreign policy. What we do know, we've seen Barack Obama object to when they were running for office. So it is an odd choice.
MATTHEWS: That's the comment made by David Broder today. He said that basically one of the principle reasons he, Barack Obama, was elected was that, relying on his instincts, he came to the correct conclusion that war with Iraq was not in America's interest. He was more right about that than most of us. He is talking about Broder and the other Washington establishment, including Hillary Clinton. So Hillary had establishment thinking working for her in supporter the war. He had a somewhat, you could call it a radical objection, but he definitely objected to the war, like some of us did. Should she be his agent?
GORDON: Outside of that, though, we can say that they're pretty much aligned on foreign policy outside of the war issue. We saw that during the campaign. The interesting point here is I'm not sure we're giving Barack Obama and his team enough credit. He understands what the Clinton conundrum, as you suggested, is. He understands the persona and the big tent she brings. I think they've been smart heretofore, and they'll continue to be smart. If they pick her, they believe that she has been vetted properly and that she will, as she did on the campaign trail, play the game correctly.
Secondly, Bill Clinton, I think, wants to, as we heard today and yesterday, wants to be open in the vetting process, because I think Bill Clinton still understands that there was a want and need for him to save that legacy and come back into the Democratic fold as the grand old man of the party, the big thinker. He was seen to some degree during the campaign. This is a good opportunity for him to rectify that.
MATTHEWS: Wow. What do you make of that, Clarence?
PAGE: Well, he has a great reputation internationally. The irony here now is that he has to scale back his international activities, foundation activities.
MATTHEWS: He can't take money from anybody anymore.
PAGE: That's right. He has to be even more transparent than he has been. He has been pretty transparent, to his credit.
MATTHEWS: Can he-I don't want to knock it for him. He is a private citizen. But if he makes 200,000 dollars a speech from some potentate somewhere, there will be an assumption that that's baksheesh, that that is a payoff.
PAGE: It depends on who pays it.
MATTHEWS: How about most of the people that do pay, that have that kind of money.
PAGE: That's true of all ex-presidents. If people want to raise questions about it, they can. The Clintons have doubled-
MATTHEWS: Most ex-presidents don't have wives or husbands who are secretary of state. That's the difference.
PAGE: That's the problem. Under the executive-the laws governing executive branch disclosure, he is bound to-
MATTHEWS: Well, Joan Walsh started the show by saying we've been trusting Barack Obama's judgment for an awful long time, some of us. Why don't we trust him on this one? There is food for thought. Clarence Page Ed Gordon, thank you. Join us again tomorrow night at 5:00 and 7:00 Eastern for more HARDBALL. Right now, it is time now for "1600 PENNSYLVANIA AVENUE" with David Gregory.
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