'The Rachel Maddow Show'for Tuesday, December 23

Guests:  Jim Warren, A.B. Stoddard, Katha Pollitt, Michael Lewis, Kent Jones

RACHEL MADDOW, HOST:  And thanks to you at home for sticking with us for this next hour.

Have you seen the newest Rick Warren video message to his congregation?  Apparently, his critics are hate-speech practitioners and they are Christophobes.  Christophobes?  Way to find common ground and bring us all together, Pastor Rick.  There‘s more and we‘ve got lots of it.

But first, the long awaited Obama transition team, Blagojevich communique internal inquiry is in.  And—and—and it‘s in.  The report says that the president-elect did not have any inappropriate contact with Illinois Governor Rod Blagojevich.  It says that the president-elect did not know anything about the governor trying to sell Obama‘s Senate seat.  That Obama didn‘t talk to the governor or anyone on the governor‘s staff.  And that Obama‘s aides including chief of staff, Rahm Emanuel, never went along with the governor‘s efforts to sell the Senate seat.

In other words, you saw the big cloud of smoke.  You followed the big smoke cloud.  And still, nobody can find a fire here.  Governor F-bomb himself definitely has a fire.  He has definitely found himself in a scandal—one that is not going away any time soon.

But the president-elect?  So far?  No fire.  But, what about the Chicago politics?  Isn‘t Obama from there?  Yes.  That‘s not enough to make this his scandal.  That makes it still, a Blagojevich‘s scandal.  It doesn‘t make it an Obama scandal.

Yes, but then there‘s the curious timing of when today‘s report was released, right?  This the more interesting charge.  See, there‘s this well-known thing that politicians do with bad news, with scandal.  It is so well-known that to explain it we can actually turn to the fictional administration of one President Bartlet from the TV show, “The West Wing” in order to explain it.


UNIDENTIFIED MALE:  Are you going to tell us about the advance guy in the helicopter?

UNIDENTIFIED FEMALE:  I‘ll have information for you Friday.

UNIDENTIFIED MALE:  You‘re going to dump it into the Friday trash.

UNIDENTIFIED FEMALE:  Just as (INAUDIBLE) to the vice president, Danny, he‘s resigning.  You want to run a special section?

UNIDENTIFIED MALE:  Just minding the people‘s business.

UNIDENTIFIED FEMALE:  A job you‘re uniquely suited for.





MADDOW:  You‘re going to dump it in the Friday trash?  Right.  So, the concept here is this.  You release all your bad news on a Friday because then it only gets into the Friday night newscast and Saturday papers which have lower viewership and lower readership than the other newscasts and papers of the week and then other news happens on Sunday.  And by the time anybody is really paying attention again on Monday, you buried Friday news is forgotten.

Of course, even better than Friday, for bad news trash disposal?  In fact, the ideal time for bad news trash disposal is right before a holiday.  Yes.  So, today, Christmas Eve eve, we‘ve got an afternoon news release from the Obama transition team about their communications with scandal plagued Governor F-word.  There‘s a smoke here.  It‘s so suspicious.  There must be a fire here somewhere.

Well, actually it turns out the U.S. attorney, Patrick Fitzgerald, asked the Obama guys to delay the release of the report until after Monday, which would bring us to Tuesday.  Today.  The “New York Times” reports, quote, “Fitzgerald office had yet to complete their interview late last week, people familiar with the case said, and asked the Obama team not to release its report on Monday.”

So, maybe it looks bad to release information the Tuesday before Christmas?  Christmas eve eve?  Unless, of course, the U.S. attorney told you couldn‘t release your information until the Tuesday before Christmas, Christmas Eve eve.  In other words, no matter how smoky it seems in here, there‘s still no fire.

In releasing the report, incoming White House counsel, Greg Craig, spoke to reporters in a conference call.  Here‘s what he had to say.

First up, the subject of incoming White House chief of staff, Rahm Emanuel.  He was the only one to even talk to the governor.  And apparently, he did not know anything about this business of Senate seat-selling.  That‘s what they say.


GREG CRAIG, INCOMING WHITE HOUSE COUNSEL:  What I found was that the president-elect‘s statement that he had no contact or communication with Governor Blagojevich or members of his staff is accurate.  And the—that only one member of the transition staff had any such contacts and that was Rahm Emanuel, who had a couple of conversations with the governor.  And about four conversations with the governor‘s chief of staff.  My inquiry determined that there was nothing at all inappropriate about those conversations.


MADDOW:  So, OK, next up is Obama senior adviser and one time potential short-lister to fill his Senate seat, Valerie Jarrett.  The transition team says she also did nothing inappropriate.  But interestingly enough, she was made aware via third-hand gossip of Governor F-word‘s delusional, mustache-twirling master plan to get himself appointed to Obama‘s cabinet.


CRAIG:  I do report a meeting in a conversation that Valerie Jarrett had with a union official in Illinois in which the union official describes to her a conversation that he had with the governor in which the governor raised with him the idea that the governor might be considered as a possible candidate to be the secretary of Health and Human Services.  Ms.  Jarrett viewed that as a ridiculous proposition and waved it off.


MADDOW:  A ridiculous proposition.  All right, there‘s also talk about senior adviser, David Axelrod.


CRAIG:  I include a section on David Axelrod largely because he‘s been mentioned in the press.  But he recalls that after the election, the president-elect did discuss with him and with Mr. Emanuel, the names of a number of individuals who were highly qualified to take his place in the Senate.  And it was relayed by Mr. Emanuel to the governor, or to the governor‘s chief of staff, the names of these individuals.


MADDOW:  So, that‘s what they say they found about themselves.  And it all sounds very thorough and very above board and very appropriate, what you would expect from a transition team reporting on itself.  But they are operating under the certain knowledge here that the phone calls in question are on tape and in the custody of Patrick Fitzgerald, the U.S. attorney.

So, given that knowledge, it‘s not likely that you would lie about what happened in those on the phone conversations since you know they‘re on tape and you know you‘d get caught.  I know, I know, the cliche is that if there‘s smoke, there must be fire.  But regardless of the smoke, I‘m still not seeing any fire here.

Joining us now is MSNBC contributor Jim Warren, who is a former long-time editor at the “Chicago Tribune.”

Jim, thanks so much for being on the show tonight.

JIM WARREN, MSNBC CONTRIBUTOR:  A pleasure.  You know, Rachel, I was just thinking, when it comes to folk protesting their innocence and knowing that they‘ve been taped, there is one fellow named Richard Nixon who did the same and the tapes proved him rather errant in what he claims was his innocence.  So the mere fact.

MADDOW:  Yes.  But he thought those tapes would never get out.  He thought those would be his personal, enjoy his own retrospective tapes.

WARREN:  This is true.


WARREN:  And I assure you, when these get out, you‘ll be having a good time with them because if Rod Blagojevich is have you have designated, Governor F-bomb, he will meet his match when it comes to unabashed profanity in the guys of one Rahm Emanuel and I can attest—I can attest to that, having been Washington bureau chief and if only I‘d taped some of our conversations.

MADDOW:  Well, he is a notorious curser, cusser, I guess would be the best way to say that.


MADDOW:  But this statement from the transition team defies what Chicago columnist Michael Sneed had reported earlier, that Rahm Emanuel had 21 appearances on different Blagojevich tapes.  It says that the actual number of contacts was much smaller between Emanuel and Blagojevich.  Do you feel like the story is actually been moved forward at this point or is this just a small data point in a larger story?

WARREN:  Yes, I mean, that‘s small data point but still move forward a little bit.  I mean, you could look at this now and see President-elect Obama in recent weeks having been a little, little, slightly Clintonesque, legalistic, “No, I had no conversations.  I had no contacts with the governor.”  When, in fact, the report makes quite clear that almost predictably, Rachel, he had had discussions with Rahm Emanuel and David Axelrod about the sort of people he would like to succeed him in the U.S.  Senate.

So, I think on one hand, there‘s the absolutely predictable desire to have someone you really like and someone you‘re confident in, to protect the seat.  Remember, you got a couple more years left in this position and then you got to have an election for a full six-year term.  But, on the same hand, stay a million miles away from a governor whom you know is on his way to getting indicted by Patrick Fitzgerald.

MADDOW:  At this point, it does feel like it would be strange to learn that Obama never thought once about his Senate seat and didn‘t have any suggestions and didn‘t talk to anybody about it, I guess the issue here is whether or not with this report, if transition team has put itself out there in any way that could be disproved.  That they‘ve put themselves out there in any way that‘s going to look like a cover-up once we get further information.

WARREN:  Yes.  Well, I mean, remember, as best we can tell, what they‘re getting is the recollections of conversations by the people on their side involved, most notably, Rahm Emanuel.  They are not—they have not talked to Blagojevich.  They‘ve not talked to John Harris, the fellow who was the chief of staff who has since quit his position.  He was the co-defendant with Blagojevich in the complaint.  And the person who could best answer these questions is the guy who‘s heard every single word and that‘s Patrick Fitzgerald.

I mean, one sort of thing that strikes me as very interesting is, if this was such a sort of ancillary matter, this was something they didn‘t want to be too much involved in, why do you have to have four—count them -- four conversations between Mr. F-bomb, the chief of staff-designate, and the chief of staff for the governor?  Four conversations which the transition team says were explicitly about going over, supposedly neutrally, empirically, the pros and cons of each of these candidates.  Boy, is that going to be interesting?

Rahm is a smart guy.  And maybe, he was being bloodlessly neutral, empirical, even pedantic in going over the plusses and minuses of these people, but I got a feeling that he was probably committed some lively acts of candor and there may be some of the folks whose names surfaced today, again, like Congressman Jesse Jackson, Representative Jan Schakowsky and some others who maybe wincing a little when they hear what the supposed pros and most notably, cons were according to Rahm.

MADDOW:  I just feel like there‘s such a distance, though, between, ekk (ph), you heard me say the “F” word a lot in my phone conversations, ekk (ph), you heard me have a very political conversation about who‘s going to take that Senate seat as we Illinois pals were talking about this to each other.  There‘s such a distance between that, which I think we should anticipate, and any idea, any supposition, any shade that the Obama administration or the president-elect himself, is implicated in the criminal behavior here.  I just feel like.


MADDOW:  . there‘s all these little smoke bombs going on everywhere and none of them indicate a fire.

WARREN:  Gotcha.  I mean, let‘s—I mean, I think I‘m pretty close to stipulating to that.  And there is, remember, caught on the wiretaps, the seemingly profound frustration on the part of Governor F-bomb when it comes to ambassadorships, HHS positions.  Now, on one hand, it makes quite clear that nobody was talking turkey with him in a way that he desired.

But on the same hand, Rachel, you sort of just wonder, where were these signals coming from?  Were they extraterrestrial?  Was it, you know, too many Miller Lights after watching reruns of losing Cubs playoff games?  What was going on here that he felt that he was being so spurned by the president-elect of whom he spoke as we now know, rather uncharitably?

MADDOW:  Jim Warren, MSNBC contributor, formerly a long-time editor at the “Chicago Tribune,” thanks for coming on the show.  Have a good holiday, Jim.

WARREN:  A pleasure.  Same to you, guys.

MADDOW:  Thanks.

People woke this morning to the sight of water—lots of it—gushing through the streets of suburban Maryland because a 44-year-old pipe broke.  That‘s what happens when we keep putting off necessary repairs to our public works.

Coming up: Why we need a different kind of bailout—a literal bailout?

And later on, lame duck watch—billions of our tax dollars to help out the banks but where is the bank bailout money going?  Here‘s a hint.  It‘s a secret.  Author, Michael Lewis joins us to break the financial omerta.

But first, one more thing, about clearing people of wrongdoing.  President Bush got some last-minute pardoning in before taking off for Christmas at Camp David.  He took 19 people off the hook today.  Included on the list are drug dealers; a mail thief as in M-A-I-L, a postal thief; a man who helped to arm Jews trying to found Israel in the 1940s.

There are no big names on this list, really, except, maybe—well, there‘s this guy who was sentenced to three years‘ probation in February of 1962 for forging the endorsement of a U.S. Treasury check.  That guys name?  Delano Abraham Nixon, that‘s three really big names actually, Delano Abraham Nixon.  That makes him at least the second Nixon to receive a presidential pardon.  I wonder if that gave him a leg up on the competition here.


MADDOW:  America‘s cable news devotees awoke this morning to a story that cable news networks would store away for lean times if we could.  I‘m speaking, of course, of the mesmerizing images of a 44-year-old, 66-inch water main break in the Washington, D.C. suburb of Bethesda, Maryland today.  So much water, thousands and thousands and thousands of gallons of it, all icy cold, gushing downhill on, ironically, named river road.  Authorities sent helicopters and boats to rescue stranded motorists caught in the middle of it.

Once you start watching, it‘s kind of hard to turn away from those images.  This is a visually-compelling story.  After well more than an hour of compelling dramatic pictures from Bethesda, there were no injuries to report—which is great news.

And while we‘re on the subject of compelling visuals—did you see this video from yesterday?  This is Tennessee.  Look at this—where a 1906s era dam holding back a retention pond at a coal-fired power plant gave way, releasing a mix of water, ash, and mud that damaged 12 homes reportedly put up to 400 acres of land next to the plant under four to six feet of black (ph).

The connection between these two visually compelling collapse of something stories is one of my favorite words that no one else thinks is a sexy political term—infrastructure.  I think it‘s a sexy political issue because our national infrastructure is a disaster, and sometimes, the results are simply amazing pictures and a big mess, like if you‘ll recall the steam pipe that blew up under a New York City street last year.  Remember that one?  Yes.

Other times, this big huge important national regress, having really old, rotting pipes, and bridges and levees and dams and electrical grids, results in more enormous human tragedy, like the devastating bridge of New Orleans levees after Hurricane Katrina, like the collapse of an interstate bridge spanning the Mississippi River in Minneapolis last summer.

Our country had a lot of infrastructure investment in the 1930s and in the 1950s.  We were due for an infrastructure upgrade in about 1980.  And that‘s when a widely-beloved president proposed turning back most of the federal aid highway program and all transit programs to the states.


RONALD REAGAN, THEN-PRESIDENT OF UNITED STATES:  In this present crisis government is not the solution to our problem, government is the problem.


MADDOW:  That was the philosophy.  No infrastructure spending for you.  But, you know, today, there‘s actually a little bit of good news about our American infrastructure crisis.  And the good news about our infrastructure crisis is the bad news about the economy.

Yes.  The country needs to create good jobs, like, oh, say, construction jobs, to say, build and repair everything that is in dangerous disrepair.  In the nick of time on both counts, America elected a Democratic president who does not have the same ideological resistance to government that Republicans do.  He sees the need for infrastructure spending as an urgent one.

Today, Vice President-elect Biden committed to infrastructure rebuilding as economic stimulus.


JOE BIDEN, VICE PRESIDENT-ELECT:  We‘ve let our infrastructure crumble for a long, long time from water to roads to bridges.  And it makes sense to invest in them now.  There will be no earmarks in this economic recovery plan.


MADDOW:  So, what could hold the country back from this win-win-win proposition?  If infrastructure spending when we really need some infrastructure spending, and we might have politicians who would be interested in providing it?  What would hold us back from this proposition?  Hello, Mr. House Minority Leader John Boehner.  We saw your Web site this week where you are, quote, “compiling a list of stimulus spending skeptics.”

So, Congressman Boehner is going to lead Republican obstruction—excuse me—opposition to infrastructure spending by the federal government.  Now, does he disagree that we need the infrastructure and the jobs?  I need some talking down here.

Here to Talk Me Down now is A.B. Stoddard, associate editor and columnist at “The Hill.”

A.B., thanks for joining us.

A.B. STODDARD, THE HILL:  Thanks, Rachel.

MADDOW:  Here‘s your chance to Talk Me Down.  You can either tell me that the Republicans aren‘t really going to oppose infrastructure spending of stimulus or you can tell me that they will oppose it and they will be crushed.

STODDARD:  Well, I want to start by saying, in case you haven‘t noticed, Republicans are looking for an opening right now, and now that the Rod Blagojevich thing has slipped through their fingers, the cupboard is a little bare and they‘re looking for something, for some traction against the momentum that Barack Obama is enjoying during this honeymoon that has begun.  Obviously, pork is a tried and true old favorite, but it did not give John McCain much traction when he tried it during the economic collapse in the waning weeks past the economic collapse of his campaign this fall.

It is something that conservative will rally behind.  John Boehner is looking for some critics of the stimulus package.  He‘s probably going to find them outside of the Congress.  A consensus has emerged among economists that this is the time that where government must step in, obviously, to avoid a depression and to put off deficit reduction.  It is going to be very hard to convince those members who are listening to their mayors and their governors and their voters who are hurting and were out of jobs, that infrastructure is not sexy.

It is going to be—the pressure that they‘re going to be feeling, Republican members of Congress, is going to be much more powerful at home than what they hear in their GOP conference meeting.  So, while there will be a good talking point, the Republicans have about earmarks and how we can‘t let this become pork, and it‘s going to be a disaster.  But in the end, the package will pass.

And I‘m not saying it‘s going to pass within 10 days of Barack Obama becoming president, but I have I feeling Republicans will vote for it and it will pass.

MADDOW:  When—we just heard Joe Biden there say that there will be no earmarks on this plan, that there will be no earmarks spending the stimulus package, presumably, he‘s trying to head off any attempts by political opponents to caricature this as a whole bunch of “bridges to nowhere,” to say this is not just earmark pet projects, there is actually some solid thinking behind this.  Can he effectively—can the administration effectively declare that there won‘t be earmarks?

STODDARD:  They absolutely must.  He is also giving—sounding a warning to his own party: this is the only train and the largest one leaving the station.  It is not going to fall as a stimulus package under the normal sort of budgetary rules and constraints that you have in terms of pay as you go rules and that kind of thing.  So, it normally would be loaded up with pork.  People will be rushing to try to attach things, goodies, everywhere.

But Joe Biden, and Barack Obama, and Nancy Pelosi, the House speaker, and the Senate majority leader, Harry Reid, will have to be very strict to keep this earmark-free because this has to be pure stimulus or they will face, you know, the wrath of the voters in two years.  Obviously, the Republicans are preying on some anxiety and outrage people are feeling about the TARP program, worried that it was a run-away disaster and that banks can‘t tell us where and how they‘ve used the money.

So, the Democrats are under—they‘re going to have to really scrub this clean and make sure that their talking about the shovel-ready projects and that they are not pork.  And that their projects are going to create jobs and really save communities and not be tennis courts and dog parks.

MADDOW:  A.B. Stoddard, associate editor and columnist for “The Hill,” thanks very much for joining us.

STODDARD:  Thank you, Rachel.

MADDOW:  I‘m super in favor of dog parks, I should say.

Pastor Rick Warren has posted a new video on his Web site, responding to people who have criticized him and President-elect Obama for picking him to give the invocation at Obama‘s inauguration.  According to Pastor Rick, his critics have slandered him with hate speech and his critics suffer from Christophobia.  I think he slipped up and he meant Rick-o-phobia?  But that‘s just giving him the benefit of the doubt.  There is so much to say about what the good pastor now has to say.


MADDOW:  Time for a few underreported holy mackerel stories in today‘s news.  We begin with a little housekeeping, concerning a segment we did last night on the bailout.  You may recall that I proposed reconstituting this TV show as a bank.  Since the banks that got Wall Street bailout money essentially got to take that money and run with almost no questions asked.  The application for bailout money for banks was a grand total of two pages long and the banks themselves, essentially laughed in the face of the “Associated Press” this week when the “AP” made inquiries as to how the banks had used the public dollars.  Such a deal, right?

Well, the guest who I brought on to discuss and debate those issues with me was the former chair of the White House Council of Economic Advisers, President Clinton‘s national economic adviser, former Haas Business School and London Business School dean, Laura Tyson—eminently qualified to talk about the economic crisis and the government‘s response to it.

Now, what I regret that I did not realize at the time of last night‘s show, is that Dr. Tyson is also on the board of Morgan Stanley.  Now, this is publicly available information, and it is absolutely my fault for not digging it up before the show. 

Fortunately, my friend and frequent guest, columnist David Sirota, has things like this memorized.  He shot me an E-mail about the conflict of interest since Morgan Stanley is a company that received over $10 billion in TARP bailout money. 

For her part, Laura Tyson told our show today, quote, “I‘m a professional economist and business school professor.  I appeared on the show and answered the questions in this capacity.  My answers reflect my professional opinion and I am solely responsible for them.  They do not represent the views of Morgan Stanley or any other private company.” 

Now, of course, that‘s fair enough.  But what I regret is hosting a discussion about companies that have benefited from the bailout without disclosing that one of the people having that discussion has a significant financial interest in one of those companies. 

So very sorry.  Very embarrassing.  Now, speaking of awkwardness and capitalism, you know, we are the largest economy in the world.  The second largest economy in the world is Japan.  And Japan is in bad shape economically right now, too.  They just slipped into recession again for the first time in seven years. 

And the flagship automaker, Toyota, yesterday, announced its first operating losses in something like 71 years.  Boy, what a feeling, right?  But Japan‘s economic suffering has spawned an unlikely and relatively teeny, tiny economic revival there. 

More than 140 years after its initial release, Karl Marx‘s communist master work, “Das Kapital” is flying off the shelves at Japanese bookstores as a manga comic book.  Yes, it‘s “Das Kapital” in Japanese cartoon form.  The publisher says they moved about 6,000 copies in just its first couple of days on the shelf.  Volume one of “Das Kapital” follows the struggles of one character between his capitalist ambitions and his sense of guilt over exploiting his workers.  

Also everyone has oddly enormous eyes.  For any of you who are not familiar the manga aesthetic, the Associated Press, helpfully reports that manga comics are different from America‘s superhero-themed traditional comics, quote, “particularly in their frequent emphasis on cuteness.”  And that causes commodity fetishism and the redistribution of wealth.  See the dots connect? 


MADDOW:  So it turns out the Rick Warren-Barack Obama invocation speaker scandal is getting worse, not getting better.  Not only is it getting worse, it‘s getting weirder. 

As recently as a couple days ago, you may recall us reporting that Rick Warren‘s Saddleback Church Web site includes this gem, quote, “Because membership in the church is an outgrowth of accepting the lordship and leadership of Jesus in one‘s life, someone unwilling to repent of their homosexual lifestyle would not be accepted as a member of Saddleback Church.”

In other words, you can‘t be gay and be a member of Rick Warren‘s church.  Wow.  Did Barack Obama know that about Rick Warren when he asked him to lead the nation in prayer at his swearing-in? 

Well, yesterday we reported that Saddleback Church had pulled that anti-gay language off of its Web site.  Now, this is where it gets weird - Saddleback now says that the “you can‘t join the church if you‘re gay” language, was only pulled to repurpose it for clarity.  But apparently, the policy still stands. 

At this point, President-elect Obama is surely preferring a course of peace and quiet from the leading Evangelical denizen of Orange County, California, but no such luck.  Pastor Warren bizarrely decided to record a 22-minute video on Sunday night for his congregation.  It goes up in a section of his website called “Pastor Rick‘s News and Views.”  He does this regularly. 

But apparently, he‘s decided to devote this 22-minute discussion almost entirely to the discussion of this controversy.  He did this on Sunday, well after the furor over his selection as inauguration invocator had erupted, and even it started to cool a bit. 

Here‘s Pastor Rick talking about his role at Obama‘s inauguration.  


PASTOR RICK WARREN, SADDLEBACK CHURCH:  One of the questions that came up was, “OK, Rick, why did you accept President-elect Barack Obama‘s invitation to do the inaugurational prayer - the invocation? 


MADDOW:  The invocation, that‘s what it‘s called.  Can you tell that this thing isn‘t scripted?  He‘s just talking off the cuff for 22 minutes on this subject.  What follows on the video is less good, at least politically for Barack Obama.  What Rick Warren will go on to say about gay people recalls the rhythm of Obama‘s first pastor problem, Reverend Jeremiah Wright. 

After Obama calmed the Jeremiah Wright controversy by publicly severing his ties to his former pastor in March, then came April.  That‘s when Jeremiah Wright decided to put himself back out there.  He reappeared with an incendiary news conference at the National Press Club and that brought attention back to Obama‘s politically toxic relationship with Jeremiah Wright. 

So now, with the different set of dynamics and rhetoric and offended constituencies and a different pastor, here we go again.  Instead of laying low, Rick Warren‘s video address continues with guns blazing.  


WARREN:  I have been accused of equating gay partnerships with incest and pedophilia.  Now, of course, as members of Saddle Back Church, you know, I believe no such thing.  I never have.  You‘ve never once heard me in 30 years talk that way about that.  


MADDOW:  I think I remember once - I think I remember once, remember this? 


WARREN:  I‘m opposed to having a brother and sister be together and calling that marriage.  I‘m opposed to an older guy marrying a child and calling that a marriage.  I‘m opposed to one guy having multiple wives and calling that marriage.  

UNIDENTIFIED MALE:  You think those are equivalent to gays getting married? 

WARREN:  I do.  


MADDOW:  “Do you think those are equivalent?  Oh, I do.”  Right.  So Warren did equate being gay with pedophilia and incest.  But you know, that‘s the hole that Pastor Rick had already put Barack Obama in.  Here‘s today‘s fresh digging.  


WARREN:  Free speech has to be free speech for everybody, even if I don‘t like it.  It‘s in our Constitution.  Now, some people feel today that if you disagree with them then that‘s hate speech.  Either if you disagree with them, you either hate them or you‘re afraid of them.  I‘m neither afraid of gays nor do I hate gays.  In fact, I love them.  

MADDOW:  OK.  So, Rick Warren loves gay people.  But what was that about hate speech again? 


WARREN:  A lot of you have written to me this week and said, “Rick, how are you going to respond to all these, you know, false accusations and attacks, outright lies and hateful slander?  And really, a lot of hate speech.”  It‘s what I would call Christ-o-phobia, people who are afraid of any Christian.


MADDOW:  So what we‘ve got here are people who think that equating homosexuality to pedophilia and incest - that represents hate speech.  Those people who think that are, in fact, guilty of hate speech themselves. 

That‘s rich, and also a really bad argument. 

And also, gay people who protest a member of the clergy who rejects them for their, quote, “beliefs?”  I believe I‘m gay?  Those people are Christ-o-phobes.  Might those people possibly just be Pastor Rick-o-phobes? 

Into the relative calm here as this scandal was maybe settling down, Rick Warren has re-injected himself and has sparked again a lot of outrage.  He has snatched the possibility of open-mindedness from the jaws of possibility.  President-elect Obama, this is not going away. 

Joining us now is Katha Pollitt, a columnist with “The Nation” and author of “Learning to Drive: And Other Stories,” which is currently on sale now.  Katha, nice to see you, thanks for coming in.  


MADDOW:  I was surprised that Rick Warren is continuing to talk about this publicly.  Are you? 

POLLITT:  No, I‘m not.  Rick Warren, I think when you said he confuses himself with Christ, I think you‘re on to something.  The man obviously has a colossal ego.  He‘s a best-selling author.  He‘s got churches all over the place.  He is not going to shrink away.  This is a big opportunity for him.  

MADDOW:  The thing that seems, I guess, even more surprising to me in watching this 22-minute video today and spending more time than I ever thought I would in my life with learning about him and his politics as an activism, is that he sort of seems like a “not ready for primetime player” here. 

That was an unscripted 22-minute screed that had a lot of very impolitic comments, things that are not going to help President-elect Obama take this heat for having extended this invitation.  I would have thought that a man that‘s so experienced internationally and in national politics would be more careful.  

POLLITT:  Well, I had a different feeling about that video which I watched while I was having my little dinner before coming here.  I thought, my god.  He‘s very - he does project that teddy bear geniality - I‘m talking to you.  He has that ability to seem like he‘s just talking to one person when he‘s talking to, you know, hundreds of - however many - hundreds of thousands are watching. 

And I thought that the things that you noticed would fly by the people that that was aimed at who share those beliefs.  They also think that they‘re the real Christians.  So if you don‘t like Rick Warren, you don‘t like Christ.  

MADDOW:  How big of a political problem is this for Barack Obama?  And is it getting larger or getting smaller? 

POLLITT:  Well, I think it is getting larger.  I think that the Proposition 8 and the disappointment and anger over that has given it a news hook that might not otherwise be there.  When I wrote about it in the “L.A. Times,” I focused on some of the other things that Rick Warren believes that I find very disturbing. 

Besides the anti-gay stuff and the anti-gay marriage stuff, that he has compared people who are pro-choice to holocaust deniers.  He says that women who have abortions are like Nazis.  And compared - you know, it‘s like comparing their wounds to Auschwitz. 

He has very disturbing ideas about the inequality between the sexes, that he believes, and his church believes - it‘s all over the church‘s Web site - that wives should be subject to their husbands and that the husbands where it goes. 

I learned today - and I think everybody should spend time on the Saddleback Web site because it‘s very educational.  He believes there are only two reasons you can get divorced, so all those gays who want to get married better think about this. 

MADDOW:  Yes.  The exit strategy.

POLLITT:  And the reasons are abandonment and infidelity, but abuse is not a reason.  Abuse is not a reason for divorce.  

MADDOW:  Wow.  I think that this problem is getting larger for Barack

Obama, and I think that is largely the choice of Rick Warren at this point

which itself should be a bit of a warning bell.  Katha Pollitt, columnist

at “The Nation,” author of “Learning to Drive: And Other Life Stories,”

it‘s really nice to see you.  Thanks for coming in.  ‘

POLLITT:  Thanks so much for having me.  

MADDOW:  Coming up, what if the government loaned huge amounts of money to big financial institutions and then didn‘t want to talk about it at all? 

Author Michael Lewis joins me next to talk about financial transparency or actually the complete lack thereof.  


MADDOW:  OK, are you ready?  Here‘s what you do.  You take equal parts of honey and water.  You heat them up a little bit on the stove so you get kind of a thin honey syrup.  Then, in a mug or a thick glass, put in half ounce or maybe an ounce of your honey syrup.  Put in half an ounce of dark rum, half an ounce of bourbon, half an ounce of fresh lemon juice, and then you top it off with about three ounces of hot water out of the kettle.  Stir those around a little bit.  Put a big, thin-cut piece of lemon peel on top for garnish.  And what you have there is a toddy - a hot toddy. 

You know, you can rely on abundant good cheer to get you through the holiday season.  But why take that chance? 


MADDOW:  The word “TARP” used to make you think about stuff that needed to be covered up in the rain, like the baseball field, right?  Or a roof with a hole in it.  Well, now, the ward TARP has joined FEMA, Corvair, and Nixon on the list of words that at one time were totally innocuous but now, really aren‘t. 

The only thing George Bush and Henry Paulson‘s TARP and the old baseball field tarp have in common now is a total lack of transparency. 

It‘s time once again for the official RACHEL MADDOW SHOW “Lame Duck Watch,” because somebody‘s got to do it. 

In October, when Congress and the American public were being rushed into bailing out Wall Street, the plan they offered up seems, even at the time, loosely put together and short on the details. 

Since then, it‘s been a rolling avalanche of headlines like, “Executive Pay Limits May Prove Toothless.”  “Loophole in Bailout Provision Leaves Enforcement in Doubt.”  Or my favorite, “Where‘d the Bailout Money Go?  Shhhh, It‘s a Secret.”  That was an actual wire service headline this week. 

Well, in the midst of all the confusion and the no-transparency, the government gave a giant bailout-related contract to the Bank of New York Mellon.  We here at the RACHEL MADDOW SHOW call them, “Bony Mellon.”  “Bony Mellon‘s job is to oversee auctions that were supposed to be run by the governments to buy up bank‘s troubled assets. 

Except the auctions never happened because the Treasury Department changed its mind after it got the money and decided it would be better to just give our money to the banks.  So then what‘s “Bony Mellon‘s‘ job now that the auctions they got hired to oversee never happened?  Are we still paying them?  If so, how much are we paying them?  Investigators at “ProPublica.org” have been asking the treasury for that information.  But so far, this is all they have been willing to disclose. 

Check this out.  You see the blacked-out part there?  It‘s redacted.  How much we‘re paying this bank to administer the bailout auctions that never happened is blacked out and redacted like it‘s a state secret or something. 

Adding insult to injury or maybe adding injury to insult here,

“Bony Mellon” also got a $3 billion bailout itself.  But when asked by the

Associated Press what they, “Bony Mellon,” have done with their bailout

money, they were the bank of which the Associated Press said, quote, “a

spokesman wouldn‘t share spending specifics and added, ‘I just would prefer

if you wouldn‘t say that we‘re not going to discuss those details.‘”

We‘re not telling you what we‘re doing with the money and don‘t say that we‘re not telling you what we‘re doing with the money.  This is the folks who are not only administering the bailout but also getting the bailout?  Does anybody have a tarp I can hide under? 

Joining us now is author Michael Lewis.  He is a former bond salesman for Solomon Brothers.  He wrote the book “Liars‘ Poker,” which was a behind-the-scenes expose of Wall Street.  He also wrote two of the best sports books ever, “Money Ball” and “The Blind Side.”  Most recently, he‘s editor of a new book called, “Panic: The Story of Modern Financial Insanity.”

Mr. Lewis, thank you so much for joining us tonight. 


INSANITY”:  You‘re welcome.  Thanks for having me.

MADDOW:  So the financial crisis we‘re in is man-made, right?  This was not an act of God. 

LEWIS:  No, out of the clear blue sky.  I was talking to someone very knowledgeable about these things recently and I said, “Is there any crisis, financial crisis in history, that‘s worse?  And he said he had to think about it.  He said, “Well, you know, right after the outbreak of World War I, they had to close the British Stock Exchange for six week,” he said. 

But then you had World War I and no one was expecting that to happen, so you could sort of understand that.  This is probably worse and came out of a completely clear blue sky.  It was auto-generated by financiers. 

MADDOW:  And if it is auto-generated, if this is a man-made crisis created by Wall Street, forgive my ignorance, but why are we having Goldman Sachs executives and banks that are currently being bailed out run the bailout? 

LEWIS:  It‘s a very good question.  I think they‘re redacting documents because they‘re afraid that you‘re going to make fun of them if you knew what was in them. 

MADDOW:  I would. 

LEWIS:  Well, so this is what I can‘t figure out.  Maybe you can answer this question, because you seem to be clear thinking.  So you have this problem.  You want to save these banks.  So you have banks around to make good loans into the economy and stimulate economic growth. 

Why do you start by giving tens of billions of dollars to banks that have done nothing but make bad loans?  I mean, they‘re giving the money to precisely the institutions that caused the problems in the first place.  Why don‘t you go out and find some innocent little bank that didn‘t sell mezzanine CDOs and didn‘t get, you know, deep or neck deep in the sub-prime mortgage bond business and who didn‘t self-destruct and give them the money? 

If you‘ve got to give the money to somebody, give it to a good banker who‘s used to making good loans, not to a bad banker who‘s used to making bad ones. 

MADDOW:  And if we‘re going to focus on actually solving the problem and making sure this doesn‘t happen again and not rewarding failure, isn‘t it a little bit of a surprise that in all the government action and debate about how to respond here, nobody has moved ahead on regulating Wall Street, which would sort of be getting at the root of the problem? 

LEWIS:  That would be the beginning of it.  And how about the credit rating agencies? 


LEWIS:  There‘s been a total institutional failure in the financial system, not just the Wall Street banks but the credit rating agencies.  The SEC is an embarrassment.  And, yet, there‘s no institutional reorganization.  All of the energy in the bailouts, as far as I can see, is aimed at preserving the existing institutional structure and the existing institutions. 

So it makes - I mean, you know, maybe I just don‘t understand it, because it‘s all so complicated, but it makes no sense whatsoever to me.  And I‘m a little surprised that these people who are in the treasury can get away with the opacity that they‘ve gotten away with. 

I mean, they‘re under a TARP.  I mean, they‘re doing all this stuff and they‘re doing different things, you know, today than they did yesterday.  And they keep changing their minds and changing their strategies and they‘ve got $700 billion of your money. 

And, yet, you know, nobody seems to be terribly outraged by it.  It‘s actually kind of great in a way.  It‘s amazing that this is possible in this day and age. 

MADDOW:  It‘s great as theater if only they were playing with theatrical money instead of our future.

LEWIS:  I hope there‘s some left - I just kind of hope there‘s some left for the Obama administration. 

MADDOW:  Michael Lewis, editor of the new book “Panic: The Story of Modern Financial Insanity.”  Thank you very much for your time tonight. 

LEWIS:  Thanks for having me.

MADDOW:  Coming up next, I get just enough pop culture from my friend, Kent Jones.  Have you ever sent an E-mail while you were sleeping?  Are you sure you haven‘t?  


MADDOW:  Now it‘s time for “Just Enough” with my friend, Kent Jones. 

Hi, Kent.  Happy Tuesday.  What have you got? 

KENT JONES, POP CULTURIST:  Good evening, Rachel.  Have you heard about Z-mail?  It‘s a weird new phenomenon currently being explored by sleep experts in which people send E-mail while they‘re asleep. 

In one study, a woman E-mailed her friends to dinner and drinks and she was sleeping when she wrote it.  Another woman was E-mailing her boss in the middle of the night from her Blackberry, asleep.  That really should be considered overtime. 

Experts say work-related stress could be the culprit but it could also be linked to medication or fatigue or alcohol.  One woman said she knew she had been Z-mailing when the next morning she checked her status on her Facebook page and it said, “I‘m asleep.  I‘m naked.  I‘m running.” 

Finally, the whole mistletoe thing - you know, you hang it up and people kiss under it during the holidays - over.  A florist is quoted in the “St. Louis Post Dispatch” saying there are just no calls for it anymore.  Really, it‘s a thing of the past.  It‘s just one of those traditions that have gone by the wayside. 

In fact, “The Post Dispatch” called more than a dozen nurseries, florists and Christmas supply stores and came back with the same result - there‘s no real mistletoe for sale.  The fake stuff, yes.  Real, no. 

Once again our secular consumer culture has declared war on the rich cultural traditions of the druids.  Where does it end, Rachel?  Where does it end?

MADDOW:  Amen. 

JONES:  Sure.

MADDOW:  Yes, that will work.  Thank you, Kent.  And thank you for watching tonight.  I‘ll see you back here next week.  Until then, have a wonderful holiday.  “COUNTDOWN” starts right now. 



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