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'Countdown with Keith Olbermann' for Friday November 21, 2008

Read the transcript to the Friday show

November 21, 2008

Guest: Chris Cillizza; Anna Marie Cox, John Harwood

DAVID SHUSTER, GUEST HOST (voice over): Which of these stories will you be talking about tomorrow? The big reveal: NBC News learns that President-elect Obama will roll out his economic team Monday. The key appointments? New York Federal Reserve President Tim Geithner as treasury secretary, and New Mexico Governor Bill Richardson as secretary of commerce. What are the economic reaction and the political implications? What are the implications of this?


UNIDENTIFIED REPORTER: Senator, how soon will you decide?


SHUSTER: Sooner rather than later. The "New York Times" reports Hillary Clinton will take the secretary of state post. The Obama camp says the nomination won't be announced until after Thanksgiving. Her Senate office calls the reports, "premature," but says discussions are very much on track. Getting the best of Letterman.


DAVID LETTERMAN, TV TALK SHOW HOST: I think you were in on this. I think you were part of this.

KATIE COURIC, TV ANCHOR (through phone): No. I promise you. I had no idea until you apparently had a little cow on the air with Keith Olbermann.



SHUSTER: Still obsessing over the infamous McCain snub, Dave calls Katie Couric to get her version of the story and Keith gets caught in the cross ends.


COURIC: And I said it was funny. I was just happy they were applying make up on John McCain in front of me.

LETTERMAN: Yes, well, funny-funny to you and we had no guest.

We had to talk to Keith Olbermann.


SHUSTER: And now, for the leftovers. We broke the news last night. The turkey is pardoned in Alaska while countless others are left to suffer a very public death.


GOV. SARAH PALIN, ® ALASKA: It is nice to get out and do something to promote a local business and to just participate in something that isn't so heavy-handed politics that invites criticism. Certainly, I'll probably invite criticism for even doing this, too, but at least, this was fun.


SHUSTER: Fun for who, governor? Tom Turkey, the latest target in the Palin war on animals. All that and more: Now on COUNTDOWN. (on camera): Good evening, everybody. I'm David Shuster, Keith Olbermann has the night off. This is Friday, November the 21st, 60 days until the inauguration of President-elect Barack Obama. It's official, at least, unofficially so. In our fifth story on the COUNTDOWN: Senator Hillary Clinton has decided to accept the job of secretary of state with no official announcement from President-elect Obama until after Thanksgiving-or so we hear. Today's speculation seems a lot less speculative. The "New York Times" is reporting that Mrs. Clinton has decided to give up her Senate seat and become the public face around the world for the administration of the man who beat her for the Democratic nomination: President-elect Barack Obama. The "Times" is further reporting that in asking Mrs. Clinton to join his cabinet, Mr. Obama said that he wants to turn a former rival into a partner. A spokesperson for Senator Clinton would only say, in a written statement, that, quote, "We're still in discussions which are very much on track. And any reports beyond that are premature." At the opening of a squash center for kids in New York City's Harlem neighborhood last night, Senator Clinton did little to squash the rumors when asked about her future plans.


SEN. HILLARY CLINTON, (D) NEW YORK: And I don't think that's on a lot of people's minds.


SHUSTER: There is one cabinet appointment that apparently won't wait until after the holiday. The New York Federal Reserve President Tim Geithner is now expected to be named treasury secretary as early as Monday. Before working at the Fed, Geithner served at the Treasury Department under five treasury secretaries including Robert Rubin and Larry Summers. Retired Marine General, Jim Jones, the former supreme commander of NATO, is said to be the front-runner for national security advisor. And Democratic officials tell NBC News that New Mexico Governor Bill Richardson will be named commerce secretary also on Monday. He was energy secretary during the Clinton administration and, of course, a presidential candidate in 2008. Let's turn now to CNBC's John Harwood, also, of course, from the "New York Times."

And, John, good evening.


SHUSTER: John, why wait until after Thanksgiving before the formal offer? With so much movement seemingly every day, what's the holdup, especially, with all of these leaks?

HARWOOD: Well, I think there are a couple things, David. First of all, very complicated negotiations, as you know, working out the details of how President Clinton would conduct his business dealings and philanthropic dealings if his wife takes this job. But secondly, the administration or the president-elect had bigger fish to fry in terms of naming his economic team. The market has been so turbulent, a lack of confidence, consumer spending is falling, unemployment is rising, and he felt he needed to get out front and that's what he's going to do on Monday by naming Tim Geithner to treasury.

SHUSTER: As far as Senator Clinton, seniority rules in the Senate and the role they might have played in her decision, how frustrating must it have been for someone who collected 18 million votes in the Democratic primary to return to a body where she remains a very junior lawmaker?

HARWOOD: It's got to be incredibly frustrating, David. Hillary Clinton set out in this 2008 presidential campaign believing that she was going to be elected president of the United States. It's very difficult after you come so close as she did. Had she won the nomination, she likely would have won the general election as Barack Obama did given how good a year it was for a Democrat. Now, to go back to being one of 100, not chairing a committee on the domestic issue you care about the most which is healthcare, it's a big adjustment. It's one of the reasons why she was looking for the step-up as secretary of state which will give her an independent portfolio, a new stature, a different kind of role that she's played before.

SHUSTER: You mentioned the economic team rollout that's coming on Monday. Timothy Geithner for treasury secretary. The market responded very strongly to the mere rumor. Does that explain the timing, the idea that the sooner, the better, as far as the economic team is concerned?

HARWOOD: Yes. Wall Street likes certainty. The markets have been very turbulent in recent days. People had perceived a lack of leadership in Washington even though Barack Obama has laid out his economic plans throughout his campaign. And you saw from the positive response that this story got today that the Obama administration probably made the right move in going ahead and acting now. Barack Obama may even take questions on the economy on Monday.

SHUSTER: And Governor Bill Richardson at commerce. Why Commerce Department given that he was at Department of Energy, he worked at the United Nations? It seems like a step down.

HARWOOD: Well, it does seem like a step down, but Bill Richardson had been in the running for secretary of state. He was a possible choice for the job had it not worked out with Hillary Clinton. But, let's face it. She's got bigger political clout than Bill Richardson. She's got the job now. So, you had to find someplace to put him. And commerce is something that once Penny Pritzker, the big fund-raiser for Barack Obama, withdrew her name from consideration-that became a logical place for Bill Richardson.

SHUSTER: John Harwood of CNBC and the "New York Times"-John, thanks, as always, for being with us.

HARWOOD: You bet.

SHUSTER: For more on what a Clinton pick as secretary of state would mean, let's turn now to Steve Clemons, senior fellow at The New America Foundation, also, the author of the blog,

And, Steve, good evening.

STEVE CLEMONS, THEWASHINGTONNOTE.COM: Hey, good to be with you, David.

SHUSTER: Steve, so, why Hillary? What are the potential rewards of having her as secretary of state for Mr. Obama?

CLEMONS: Well, one of the biggest rewards is that Barack Obama finally, you know, gets the keys to the Clinton franchise, and gets to add it to the Daley franchise, the Daschle franchises, and the Kennedy franchises that he's already put together. He's brought one of his biggest critics and to be one of his policy-practitioners. She is considered to be believer in coercive diplomacy and sort of, you know, tough love with the world. And, you know, he's the guy with vision and hope. So, to bring this together and to put her to work on his vision, I think, is a very bold move.

SHUSTER: What about the risks? How could this go wrong and what might be the first misstep?

CLEMONS: Well, during her campaign, she articulated quite a number of differences with him ranging from the Middle East to how he would engage world leaders. I wrote a piece recently where I said, you know, she used to criticize him on his notion that he would sort of go around and meet the world's, you know, thugs and try to change the game strategically for the United States with some of these-these other problematic leaders. And she criticized him for not wanting to set up preconditions. Her job is going to be to set up those preconditions now and help lay out a real strategic change for the United States with countries like Iran, with Cuba, trying to deliver on Israeli-Palestinian peace. These are some of the things we've been hearing that Barack Obama is interested in doing. So, I think that the risks are-she may struggle with him at somewhere in there, and she also has a husband who's one of the largest personalities in the world, who's very presence in other parts of the world, say, you know, South Asia or the caucuses region, Turkmenistan. Bill Clinton can do things that look like the antithesis of what some of what Barack Obama might want to do and they're going to have to get that under control.

SHUSTER: As with fellow Clintonite, Rahm Emanuel, who, ironically, Hillary Clinton once tried to fire back during the Clinton administration.


SHUSTER: Now, would Mrs. Clinton be the bad cop to President Obama's good cop?

CLEMONS: Oh, absolutely. I mean, I think Barack Obama wants and needs people who are seen as deliverers, who are going to take a result throwing (ph) a strategy, and ruthlessly and tenaciously pursue results. And that means you need a hard edge in some of your policy work. And I think he's going to use her in that way, in part, to sort of protect him from those critics who don't think that he's got the skills or vision to really put the United States on a very different foreign policy and national security track. So, I think that she's going to help cover his flank and help him do this stuff. And I think he'll get the credit for being the visionary. And she's going to maybe be, you know, a new Kissinger.

SHUSTER: Do you get the sense, though, as far as Barack Obama's thinking that this is more about sort of a proactive foreign policy that he wants or that he's being driven essentially by his own domestic political concerns, the potential that Mrs. Clinton bucks up in the Senate, could be looking ahead, and possibly challenging Barack Obama at certain key junctures?

CLEMONS: Look, when you see the team that he's put together, particularly in the foreign policy and national security side, and in the management of his White House and transition team, I'm beyond the point that thinks that Barack Obama can be heckled or easily pushed into one position or another. He's pulling in the people he thinks that can get the job really done and bringing together some of the most competent doers in the American politics. I don't think that this is, you know, something that's thought of as necessarily just for political action. I think he's putting to work on his vision the kind of foreign policy practitioners he wants. Now, Bush did this to Colin Powell. Bush brought Powell in and, in a way, neutralized him politically because he was the biggest rival at the time in America and in American politics, and put him as secretary of state and basically, you know, sort of paralyzed (ph) him. I don't think Barack Obama is going to do this. I think Barack Obama is going to be very engaged in national security and foreign policy issues, and work in partnership with Hillary Clinton proactively, using her skills in just doing this (ph). So, I think it's going to be a fascinating thing for us to see.

SHUSTER: But doesn't that also require that a very strong figure for national security advisor given that Hillary Clinton at State, Joe Biden, the vice president-you look back at some of the problems with the Bush administration early on, Condoleezza Rice was considered very weak in terms of controlling Don Rumsfeld, Colin Powell, and Vice President Cheney.

CLEMONS: Yes. I mean, you did great reporting on all of this. I remember reading and watching all the time. But I think one of the issues that Bush did do, remember-he brought a lot of big guns, also. We had Don Rumsfeld, Dick Cheney, lot of other, you know, in the cast of characters they brought who thought they were sort of the be-all of the national security side. And Condi Rice really had a hard time establishing a definitive process. What's interesting and we're not talking about tonight is, I think, the increasing likelihood that Bob Gates stays at Defense. And Gates is one of the most fascinating people to watch in the interagency process of disciplining it and crunching out any ambiguity and forcing all of these big egos into a process-to some degree, Bob Gates out (ph) Cheney- Cheney and the Bush administration. It's going to be interesting to see what sort of role he plays alongside Hillary Clinton, the national security advisor, perhaps, Jim Jones and others in sculpting something where they're all pulling together rather than what we saw on the Bush administration some folks falling apart from each other.

SHUSTER: Steve Clemons, publisher of "The Washington Note"-

Steve, many thanks. We appreciate it.

CLEMONS: Thank you, David.

SHUSTER: After weeks of palpable silence, the president-elect starts picking his economic team. Economist James Galbraith weighs in on what the scene of new blood could do to the current state of the economy. Then, how did the tightly-sealed Obama campaign become so leaky as a transition team. An Sarah Palin's war on poultry, chatting to the media while an untold number of turkeys were sacrificed behind her, and now, she says she didn't know what was happening? Governor, it's never the crime, but the cover up that gets you. We will reveal the grisly details that suggest Palin had to have known-ahead on COUNTDOWN.


SHUSTER: President-elect Obama picks, at least, part his economic team. But, are they the right men for the job? And what are Obama's feelings right now about the auto industry? Corned beef. An explanation ahead on COUNTDOWN.


SHUSTER: Perhaps second only to the intrigue over all things Hillary Clinton is the urgency of the global financial meltdown. And what if anything can be done to cauterize the crisis? NBC News has learned that President-elect Obama, in an effort to reassure markets is planning a Monday rollout of his proposed economic team. In our fourth story on the COUNTDOWN: An answer to the nightly question about the Obama transition-what do we do now? As we told you earlier and barring last-minute changes, the nominee for treasury secretary will be Timothy Geithner. Geithner also happens to be a key player in helping current secretary, Hank Paulson, managed the Wall Street bailout. And regarding former Treasury Secretary Larry Summers, the "New York Times" is reporting he's likely to be named an economic advisor, who will eventually be tapped for the Federal Reserve board, possibly succeeding Ben Bernanke as Fed chairman in 2010. Bill Richardson rumored to be in the running for secretary of state is now up for the commerce post. The news comes just as worries grow over so-called "power vacuum" in Washington. Paul Krugman of the "New York Times" is writing about how the long stretch between election and transfer of power back in 1932 and 1933 was, quote, "disastrous for the U.S. economy. The outgoing administration had no credibility. The incoming administration had no authority. And the same thing is happening now." Meantime, Obama's announcement sparked a late day rally. The Dow surged almost 500 points, closing back up over the 8,000 mark. As for Obama himself, on break in a Chicago deli, he was asked about his lunch and the economy.



UNIDENTIFIED MALE: What do you think about the auto industry?

OBAMA: I got the corned beef.


UNIDENTIFIED REPORTER: Yes. That was the question.


SHUSTER: We're joined now by economist James Galbraith from the University of Texas. He's also the author of "Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too." And, professor, thanks for joining us.


SHUSTER: The reports about Obama's Monday rollout sparked a big rally. Is that, obviously, not a sign of recovery, but at least a vote of confidence in Obama's leadership and at least the confidence in the selection of Geithner?

GALBRAITH: Well, the market is possibly that it has a government and then it will have a government in place in 60 days, and maybe relieved to know that the treasury will be in the hands of someone they know. And they maybe under the impression that they are not getting the toughest possible cop, someone who does deals rather than goes first to the rules. If that's the case, it will be up to Mr. Geithner to disillusion them on that point because it's clear that we won't have a recovery until we have a new system of supervision and regulation that can keep the kind of malfunction that the markets have experienced in the last couple of years under control.

SHUSTER: Well, never mind essentially the market reaction today. Is Tim Geithner the right person for the job?

GALBRAITH: Well, you know, this is a young team. It's a technical team. Geithner and the others who aren't been announced so far and not the best known people in the economic world. And so, that tells me is that the point man for the vast economic recovery program that we are going to need in this period ahead is going to have to be President Barack Obama himself. And that may well be the intention that he's signaling here, that this is going to be at the center of his personal agenda. And then if that's true, I think it's a good sign.

SHUSTER: Your father, one of the world's most famous economists said, quote, "Politics is not the art of the possible. It consists in choosing between the disastrous and unpalatable." In terms of the Wall Street and auto industry bailouts, which category do these fall into?

GALBRAITH: Well, in the case of the Wall Street bailout, we moved from the disastrous, which was the idea that you could purchase back all of these poisonous assets, to the merely unpalatable, which is that the idea that the government should invest in and basically own a large part of the banking system. In the case of the auto industry, we are now flirting on the choice between the disastrous and the merely unpalatable. It would be disastrous to do nothing, to give them a loan and buy some time to get a plan together. It's unpalatable, but it is absolutely necessary at this stage. The last thing we want is to have a meltdown of the industrial center of the country in the two-month period between the-before the start of the next administration.

SHUSTER: If the bailouts will not solve the economic crisis, what should the Obama administration's first act be on January the 20th?

GALBRAITH: The bailouts can stabilize the financial system. If we are lucky, they will do nothing for the underlying the economy. We're going to have to deal with housing. We're going to have to deal with the crisis of state and local finance. We're going to get credit into infrastructure in a massive way. We're going to have to backstop the incomes of the elderly. And we're going to have to provide tax relief to working people. The first thing that the Congress should do coming in is pass a revenue-sharing bill that would restore the fiscal position of these states and cities, and towns all over the country, prevent them from these massive cuts which are everywhere, draining the life blood out of the economy. That would be on the president's desk on the first day, and many other things, but that would be the first step.

SHUSTER: And, Professor Galbraith, as far as the rollout on Monday, what should we be looking for in terms of the overall message from this new Obama economic team?

GALBRAITH: Well, I think, the team should come out and then they should go back in and got to work on the details of a package, some of which can be enacted before the administration takes office, and the rest of it which will have to be put into place very carefully and deliberately over the next year and even the next two years. This is not going to be an easy process. There is no simple, straightforward recovery from the enormous disaster that has been beset (ph) on the economy, basically, by the misgovernment of the last of couple years. And so, the team is going to have an enormous amount of work cut out for it. They should just come out and say hello, go back in and start the job.

SHUSTER: James Galbraith, the economist at the University of Texas and author of "The Predator State," thanks for joining us.

GALBRAITH: My pleasure.

SHUSTER: Well, was the current president publicly snubbed by other world leaders last weekend as CNN reported? The truth comes out in Oddball.

And Palin misstep that you're just can't make up. We'll revisit the Palin turkey slaughter press conference, just what was going through her head. Well, those helpless turkeys lost theirs.


SHUSTER: It was on this day 28 years ago, when 83 million people tuned in to CBS to find out who shot J.R. In March of 1980, season three of "Dallas" ended with oil tycoon J.R. Ewing getting whacked in his office. A summer hiatus and an actors' strike prolonged the mystery, will J.R. live? Who could have done such a thing? With more than a third of the nation watching, season four opened with the J.R. alive but paralyzed. And the shooter was revealed to be J.R. Ewing's jilted ex-lover, Maggie Simpson. Maybe I have that wrong. And anyway, let's play Oddball. We begin with the reports filed by CNN's Rick Sanchez and (ph) with the Internet's freaking out this week. In the clips, Sanchez opines about what he says is a global cold shoulder given to President Bush at a Saturday G-20 summit photo-op. Take a look.


RICK SANCHEZ, CNN ANCHOR: I want you to look at this video, alright? It seems almost sad. Look at this. This is the president of the United States walking out on stage to take a picture with world leaders invited to the G-20 summit over the weekend. Look at him. And he seems like the most unpopular kid in high school that nobody liked-you know, the one with cooties. It's maybe a case of what goes around comes around or may be not.


SHUSTER: It turns out, Sanchez was way off. If he and his producers have done a little more research, they would have seen that the president had already greeted world leaders, shaking their hand in a previous photo-op. Of course, all of us make mistakes and I'm sure Mr. Sanchez regrets his error. That said, Little Ricky, I'm afraid, we're going to have to tase you, bro.





SHUSTER: To Tokyo, Japan, with another "Seinfeld" episode comes to life, it's a guy wearing a bra. And it's not based on a fetish, they don't call it a bro or mangerie (ph) but these bras for men are a big hit at a Japanese lingerie Web site called "Wish Room." The bras come in black, white, and pink. The (INAUDIBLE) says she's already sold 300 units at $30 a pop. The lingerie is marketed to cross-dressers and gentlemen afflicted with unsightly man boobs or moobs. Finally, to Edmonton, Alberta, Canada, where this is rather a chunk of space rock hurdling towards earth or have we found that lost NASA tool bag. Shot last night, this is video from a dash-cam of an Edmonton police cruiser. Scientists say it's a meteor. Witnesses say they heard loud booms before seeing the ball of fire. The glow could be seen as far away as Saskatchewan to the east and Alaska to the west, where Sarah Palin was doing an interview with her back turned so-she didn't see it. Leak investigation: Why Obama's transition team is leaking so much when his campaign was watertight? And here's the spirit of Thanksgiving. Sarah Palin surrounded by slaughter. And now, she's claiming ignorance of what was happening. A turkey of a news conference-ahead. But first, time for COUNTDOWN's top three Best Persons in the World. Number three: Best gentleman robber. In West Dansville, Vermont, a man with a knife robbed Joe's Pond Country Store. Not only did he apologize to owner Jeff Downs as he did it, telling him, "I'm very sorry I have to do this." But when Mr. Downs asked him to leave behind $1 bill so that morning shift had change, he did that, too.


Number two: Best reassignment. Major General Seh Daeng of Thailand, a "Rambo"-like figure who has previously threatened to bomb anti-government protestors and drop snakes on them by helicopter. He now has a new job as an aerobics teacher to promote public health in market places. The general is not too pleased with his new role. He told the local paper, "It's ridiculous to send me, a warrior to dance at market. The army chief wants me to be a presenter leading aerobics dancers. I prepared one dance, it's called the "throwing a hand grenade" dance. Number one, best plot that never was. The official "Star Wars" Website has revealed this tidbit about Han Solo. He wasn't always scripted to be with Princess Leia. In fact, early scripts had him married to and smooching with a wookie. Somewhere Rick Santorum's head just exploding.


SHUSTER: Back in the days of the Obama campaign when reporters wanted to know Obama's thinking and how much money he raised, here is what an Obama leak sounded like. But on our number three story tonight, we now have a whole menu of leaks. Transition sources, Democratic sources, Clinton confidantes, sources close to Clinton confidantes, sources familiar with the transition, sources with knowledge of Clinton's thinking, sources not even remotely close to any confidantes with any knowledge of anything. How did we get here? "The Washington Post" today tries to explain the genesis of these leaks. One culprit, price (ph); not only are the top tiers of the transition larger than the top tiers of the campaign but now his thinking and choices have to be transmitted to institutions outside his control. Not just the FBI, but everyone the FBI must contact to do its background checks on Obama's choices, including I should add, Congress which leaks like a sieve. According to the "Post" the leaks have sunk Obama's plans for a methodical selection of his team and have drowned out his public messages of the day. Joining us now, one of the reporters of that "Washington Post" piece, Chris Cillizza, political reporter for Thanks for your time, Chris.

CHRIS CILLIZZA, WASHINGTONPOST.COM: Hey, David. Thanks for having me.

SHUSTER: You're welcome.

Is the core Obama team; are they holding fast or are they getting a little leaky as well?

CILLIZZA: It's important to define this. There are strategic leaks and that is coming out of the Obama campaign aimed at moving a story or maybe beating back a story that it's out there. But, there's a lot more leaking going on than we saw during the campaign. You mentioned the FBI. There's a whole another thing. Remember, when Barack Obama wanted to make a decision on the campaign, he probably consulted with a very small group of people that included himself, his wife, his campaign manager, David Plough, his senior advisor, David Axelrod and not a lot of other people beyond that. Let's say that he wants to pick Hillary Clinton for the state department, just for example. He has deal with all of Hillary Clinton's people as well; that's a lot of people. Those people are not necessarily first and foremost loyal to Barack Obama. They are loyal to Senator Clinton and her interests. So you're getting a lot of conflicting advisors; people looking out for number one or for their particular politician. That's when you see these unplanned leaks that we saw a lot of this week.

SHUSTER: And is that what's driving these leaks from sources outside of the Obama camp; simply trying to look out for Senator Clinton or for Bill Richardson or for a host of other characters?

CILLIZZA: It is, David, because so much of this-I always compare these sorts of things to a glacier. There's a little bit on top and a lot of it underneath the water that you don't wind up seeing. There's a huge amount going on behind the scenes. Someone like Bill Richardson's clearly his preference would have been secretary of state. It looks like that's not going to happen as Senator Clinton appears to be getting that. So now, it's the jockeying of what does he get next. I reported this morning he's a top contender for commerce. I know Andrea Mitchell among others have moved that along; so each of these politicians just trying to get their best case scenario out there. They want to make the case publicly and privately so they're fighting that battle on both fronts and leaking is one way to do it.

SHUSTER: Your story suggests that leaks and rumors are derailing how Obama wanted to handle the transition. How seriously do they view these things and why are they problematic?

CILLIZZA: I don't think they view them all that seriously, David. At the end of the day, what matters is the person that Barack Obama is going to choose going to get nominated and is going to do a good job; going to get through Senate confirmation. That ultimately is the judgment. The people we remember are not people whose names got leaked early. We remember the Zoe Bear (ph) to the Kimble Woods (ph); two of Bill Clinton's nominees for attorney general who didn't make it through the vetting process. Ultimately Barack Obama, however it comes out, what he and his campaign team and his transition team are most concerned with is making sure these people can pass the vetting process, can get confirmed by the Senate and ultimately are ready, willing and able to do the job for which he picked them.

SHUSTER: However, does all of these have any implications for the actual Obama administration or do things simply tighten up again on January 20?

CILLIZZA: As a political reporter who's being tasked by the "Washington Post" to cover the White House, I am rooting heavily that this is a new trend and things don't return. But, I think, what you are going to see again, I think it's more likely we will see more leaking. For example what we talked about at the beginning, David. Each of these cabinet heads is going to have their own group of people whose loyalty is ultimately to that person, not necessarily to the president-elect and the vice president-elect. So I think you're likely to see more leaks than less. It's sort of the culture of Washington.

SHUSTER: Chris Cillizza, author of "The Fix" on Chris thank you.

CILLIZZA: Thank you David.

SHUSTER: He talked to Katie Couric about everything Wednesday night except how Keith ended up on Letterman while John McCain went to the CBS Evening News. Tonight, Dave rectifies his oversight. Not so for Governor Sarah Palin who pardoned one turkey then stood around chatting suddenly with the media while his fellow birds were slaughtered right behind her. And apparently, she didn't even know the carnage was happening. Sure, she didn't. Those stories ahead. But first, because they are not going away soon enough, the headlines breaking, the administration's 50 running scandals, bushed. Number three, "Nipple-Down Economics-Gate" after a federal court tossed out the FCC's $500,000 funds against CBS for airing a few seconds of Janet Jackson's breast during the Super Bowl. You might have thought the Bush administration would have more important things to focus on like not doing more damage to the global economy or insuring the transition doesn't jeopardize anti-terror efforts. Nope. Mr. Bush isn't ready to let go of Jackson's breast just yet. In a filing with the Supreme Court this week, the FCC and the Justice Department said they want a second bite of the apple. The high court won't likely announce until spring whether it will even hear the case of boobs be boobed. Number two, "Yet Another CIA Cover Up Gate;" we already knew that from '95 and 2001. The CIA was helping Peru shoot down planes of suspected drug runners, emphasis on suspected including an American missionary and her infant daughter shot dead in mid-flight. Now, we know that an internal CIA report has concluded that the CIA and Peruvian officials almost always ignore the guidelines for protecting innocent pilots; often shooting down suspect planes without ID-ing them or giving adequate warnings to land. How bad was it? So bad that CIA didn't even tell the Bush White House.

At Number one, "Ex Post Facto Gate;" one of the first things the U.S. did when it established the rule of law Iraq was to decree that private contractors were outside the rule of law in Iraq. So the Iraqi people were prevented even from bringing charges against the private contractors who killed their vice president's body guard and 17 Iraqis in the 2007 massacre at a square in Baghdad. Yesterday, U.S. officials brought officials from private security contractors in for a meeting about the new agreement between the U.S. and Iraq. Surprise! Turns out Mr. Bush told the Iraqis they can prosecute anyone they want not just for stuff they do in the future but for all that stuff they already did. A Blackwater spokesman said, "We are still trying to make sense of it," which is security industry jargon for Blackwater just peed in its pants.


SHUSTER: If David Letterman was going to forget to ask the most obvious question of CBS anchor Katie Couric; too bad he didn't have the excuse that it was actually late.

And our number two story in the "COUNTDOWN," the "Late Show" was of course taped at about 5:30 in the evening. And that helped create the original issue in the first place. You will recall that our own Keith Olbermann was a last minute guest on Letterman on September 24th, the day that Senator John McCain claimed to have suspended his campaign. McCain had cancelled on Letterman but was then caught on CBS's in-house feed over at the CBS Evening News preparing for an interview there. But when Mrs. Couric was on the "Late Show" Wednesday, there was interesting conversation but no McCain talk,


KATIE COURIC, CBS EVENING NEWS ANCHOR: Clearly she was struggling with some of those answers.

DAVID LETTERMAN, HOST, THE LATE SHOW: Right but I think-but you know those are the questions that I think, myself and average viewers might struggle with anyway.

COURIC: Right. No, they were easy. They don't really beg for instantaneous responses.

LETTERMAN: Sure, but there's thoughtful responses and maybe a month of two into the campaign she might have had some thoughtful responses.

COURIC: I think, no, in fairness to her, I think they are not easy questions to necessarily answer off the cuff.

LETTERMAN: So that's my point. But the question about which newspaper do you read. That's an easy question.

COURIC: Even in the post-election interviews, Dave, that she's done, nobody has really asked her why didn't you answer that question. She claims that I said what do you read up there in Alaska as if people in Alaska don't read or don't have access to reading materials.

LETTERMAN: So she's saying that she misunderstood the question.

COURIC: I never said that. I'm aware people in Alaska have access.


SHUSTER: Dave corrected the gross oversight last night.


LETTERMAN: Now, John McCain is supposed to be on my show, he shows up on your show, what the hell happened?

COURIC: Dave, I had no idea he was booked on your show. Am I talking really loud because I see you holding the phone way up?

LETTERMAN: Yeah, you really are.

COURIC: Yes, I'm sorry. He called me on my cell phone. Does he have your cell phone number, Dave?

LETTERMAN: Yes, he called you on your cell phone number and he said I'm suspending my campaign and he told me why. And I said, "Senator McCain, that's interesting. You're in New York, why don't you come and do an interview so you can tell the American people rather than just tell me." Had I known he made a commitment to you, I would have said-

LETTERMAN: Did that come up? Did it ever come up?

COURIC: Never. Because Dave, I would have said, "By all means, go do Dave's show."

LETTER: I think you were in on this. You were a part of this.

COURIC: No, I promise you, I had no idea until you apparently had a little cow on the air with Keith Olbermann.

LETTERMAN: A little cow. Why did I place this call?

COURIC: Then you did that creepy big brother thing by stealing our video.

LETTERMAN: Well, here it is right here, we're going to steal it again. This is what you're talking about; we swiped this from CBS News. Now I'm on the air and we're talking about John McCain we got Keith Olbermann with his giant head in the wing and they show me this. And I said wait a minute, he didn't race back to Washington to save. He's talking to Katie Couric and right away, I become very suspicious.

COURIC: And you started saying liar, liar pants on fire.

LETTERMAN: That's exactly right. And I thought this had something to do with Sarah Palin. I thought I smelled kind of a Sarah Palin cover up here.

COURIC: Oh, no, I don't think so. You mean he wanted to distract or-no, no, no. It's not true.

LETTERMAN: I think that's what it was.

Now, was there outrage at CBS News because I swiped your video?

COURIC: Nobody really knew you had done that, Dave.

LETTERMAN: What is wrong with me? Why, I should just have called Don Rickles.

Okay. I heard people over there were steamed that I had swiped the video but they found it in their hearts to get over it and forgive me.

COURIC: No, I wasn't mad. I thought it was funny. I was just happy they were applying make up on John McCain instead of me.


SHUSTER: And speaking of Keith Olbermann appearing on shows other than this one. Make sure you check your local listings and catch Martha Stewart on Monday. She will be cooking with Keith; apparently, they'll be making a pie. Hopefully not a turkey pie given this footage; the governor of Alaska willingly giving a news interview while Thanksgiving birds are dispatched. First, it was the moose, the caribou, the bears, the deer, now turkeys. Is there any animal she actually likes alive?


SHUSTER: Breaking news and the governor Sarah Palin turkey pardon interview fiasco; a denial of waddle-gate proportions. Remember, we blurred the graphic moments but you may want to send small children to another room. As we mentioned yesterday, the governor was made aware of the background and she had no problem with it, according to a cameraman. But now a representative for the governor tells Entertainment Tonight that Miss Palin did not know what was going on behind her and that all involved are unhappy about it. In other the rattling noise and the executioners contraption breaking the turkey's neck and trying to contain the shaking of the bird's death throes, that was all just innocent background noise that was not to be noticed except when she appears to look back. In any even, we've had a little more time to digest the Alaska governor's truly bizarre post turkey pardon interview where in she fielded questions about various subjects while turkeys were slaughtered behind her. In this clip, you might note that the word brutal crops up.


GOV. SARAH PALIN, ® ALASKA: I don't think it's changed me at all. I have the same values and convictions and positions and policies; just a greater appreciation, I think, for what other candidates go through. It's pretty brutal, the time consumption there, the energy that has to be spent in order to get out and about with the message on a national level; great appreciation for other candidates who have gone through this. But also, a great appreciation for this great country; there are so many good Americans who are just desiring of their government to kind of get out of the way and allow them to grow and progress and allow our businesses to grow and progress. So great appreciation for those who share that value; and it was a blast. Every day was a blast out there on the trail.


SHUSTER: In the next bit, the irony-free governor answers a question about state programs that might be on the chopping block.


PALIN: You know, thankfully, we're in a good position still fiscally speaking.


SHUSTER: And later the governor explains how much fun she is having, but suspects that she will be criticized once again by the mean old media.


PALIN: For one, you need a little bit of levity in this job especially with so much that has gone on in the last couple of months that has been so political, obviously. That it's nice to get out and do something to promote a local business and to just participate in something that isn't so heavy handed politics that invites criticism. Certainly we'll probably invite criticism for even doing this, too; but at least this one fun.


SHUSTER: Of course, there's nothing wrong with being a hunter of moose, bear, caribou and deer as is the governor. And those among us who are not vegetarians, we cannot cry fowl about the mere fact that turkeys are killed for our dinner. The point though is why would the governor allow that to be the counterpoint to her interview if she noticed it? Let's bring in Anna Marie Cox, a contributor to "Time" Magazine and the Website, "The Daily Beast." Anna Marie, thanks for your time tonight.


SHUSTER: Anna Marie, come on. How could she not have noticed?

COX: You know, I actually was going to say that stagecraft is kind of lashed saying you would think that she would need to bone up on at first. It might be something like about the constitution or the powers of government or Supreme Court cases. But maybe in fact she really needs a remedial lesson in stage craft 101. I have to believe that she didn't know what was going on, although perhaps she did. She does have this very special relationship with animals, as you pointed out. It involves blood, usually.

SHUSTER: Well and of course, the little problem is never mind the rattling noises and the shaking and all the gobbling and the weird guy back there. But there's this little moment where she turns around and appears to be looking at the contraption. I mean, what do we think she's thinking when she's looking around at Mr. Happy?

COX: Well, you know, one of the ironies of Sarah Palin nomination-one of the many, many ironies, I should add-her main speech writer was Matthew Scully (ph) who's actually an animal rights advocate and (inaudible) he's a vegan. Not just a vegetarian but in fact, a vegan. I have to wonder what he would think if he were there. Although I should point out that the kind of slaughtering that's going on in that video, believe it or not, is probably more humane than the kind of slaughtering that goes on in factory farms. So maybe this is just good old fashioned fun for Sarah, I don't know.

SHUSTER: Since Governor Palin once encouraged Alaskans to shoot and kill wolves from helicopters, is this, oddly enough, the next logical chapter in the governor's special relationship with the animal kingdom.

COX: She seems to keep finding new things to kill. It was going to be the Constitution or perhaps detainees. But I guess, now, she's just turned her sight on the smaller and smaller wildlife. Perhaps they just will get smaller and smaller and soon enough, she'll get to flies or something. I don't know.

Maybe she'll start tearing the wings off flies.

SHUSTER: I mentioned the turkey executioner behind governor Palin; that's created a lot of controversy in the newsroom, as they say. He has a very big grin on his face. Do you think it's because he likes being on TV or because he likes slaughtering turkeys? Or maybe both?

COX: Maybe he likes Sarah Palin. Maybe he likes watching Sarah Palin slaughter turkeys. There are a lot of weird videos on the Internet; a lot of fetishes I didn't know about and so that could be one of them.

SHUSTER: Yes and watching pools of turkey blood fill up into a bathtub-like contraption, maybe that's it. At the very least, should Governor Palin, if she wants to think about a national political future, should she consider learning a lesson out of all this, about stage craft?

COX: Yeah, stage craft, as I said, is important. I think I would go with basic constitutional rights, the role of the vice president and perhaps she could figure out what is on her reading list. Then I get to stage craft. I feel like before she gets in front of the camera again, I want her to focus on that other stuff.

SHUSTER: And just to be fair. A point of comparison, when president-elect Barack Obama held a post-election news conference, he placed his vice president, chief of staff and transitional economic advisors behind him. Not a great deal of fun, but maybe a lot easier to swallow, right?

COX: To be fair, I think there are people in this town that would like to see Rahm Emanuel slaughtered. Personally, I'd like to see him on a plate with the side stuffing; I think he's quite delicious. But I think it probably was more professional not to have the dying animals behind him, sure I'll go with that.

SHUSTER: We would like to publicly invite Sarah Palin to join us in this program if you would like to try to offer another explanation as to what really happened in turkey-gate. In any case, Anna Marie Cox of Time Magazine and; Anna Marie thanks as always for joining us, we appreciate it.

COX: Thank you, David.

SHUSTER: And Sarah Palin or not, that is it for this Friday edition of "COUNTDOWN." A bigger week ahead; Keith Olbermann will be back next week. For all the news on Monday, when the Barack Obama economic team is rolled out. There'll be a lot of other transition news. Watch Keith Olbermann on "COUNTDOWN." I'm David Shuster in for Keith this week but our MSNBC coverage continues now with the "Rachel Maddow Show." Hi, Rachel.



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