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'Hardball with Chris Matthews' for Wednesday, February 25

Read the transcript to the Wednesday show

Guest: Harold Ford, Jr., Tom DeLay, Jim VandeHei, Lynn Sweet, Christopher

Hitchens, Joe Conason, Ron Brownstein, Michael Scherer

High: President Obama‘s address to Congress and Louisiana governor Bobby Jindal‘s Republican response provided a clear outline of the difference between the operating principles of the Democratic and Republican Parties.

CHRIS MATTHEWS, HOST:  Battle report, Obama versus Jindal.

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews.  Leading off tonight, the battle last night.  It was his debut, and he wowed us.  That‘s the running headline from last night‘s presidential address to the Congress.  Barack Obama gave a great speech filled with upbeat themes, common sense economics and a strong personal agenda on health, education and energy.

If politics is strange to you and you can‘t really tell the difference between the two political parties, you got it thrown at you last night.  The Democrats are the party of Washington and strong government.  The Republicans are the party that views reliance on government as embarrassing, at best.  The party coming into power has a leader and is proud to say so.  The party that lost power did its best to deny last night it ever had power and put forth a spokesman who spoke as if the main perpetrator during the past eight years of budget deficits, untamed spending, Jack Abramoff and an unpopular war was not the very party he was representing.

Add to that the peculiar stagecraft of the opposition party, that seen in the Louisiana governor‘s mansion, Governor Bobby Jindal walking from somewhere in the back of this narrow hall, this winding staircase looming there, the odd antebellum look of the scene.  Some people heard my reaction at the time.  What was the message in all this?  Was this a mimicking of a president walking along the state floor to the East Room?  And at the same time, that the Republicans are so far from Washington, they can‘t be blamed for anything?  We‘ll talk to former Democratic congressman Harold Ford and former Republican majority leader Tom DeLay about both sides of last night‘s performances.

Plus, we‘re going to look at some of the hidden messages in last night‘s presidential address.  Take, for instance, this one.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  For history tells a different story.  History reminds us that every moment of economic upheaval and transformation, this nation has responded with bold action and big ideas.


MATTHEWS:  A top writer at “The Politico” will look at what the president said last night and what he really meant.

Also, we learned late yesterday that President Obama is expected to announce the withdrawal of combat troops from Iraq in 19 months and leave a residual force of approximately 50,000.  Isn‘t this pretty much, give or take a few months, what he said in the campaign?


OBAMA:  I will remove one or two brigades a month and get all of our combat troops out of Iraq within 16 months.


MATTHEWS:  And the bigger question, what will happen once the main body of our troops are out of that country?  Will we see the chaos that was predicted by those who said we should have never gone in, in the first place?  That‘s something to debate starting tonight.

And the Conservative Political Action Conference begins a three-day meeting tomorrow in Washington.  And Take a look at some of the panels being offered—“Al Franken and ACORN: How liberals are destroying the American election system,”  “Will Congress take your guns?”  And here‘s a good one, “The true cost of global warming hysteria.”  If you like “Star Trek” conventions, you‘ll love this baby.  We‘ll have that story in the “Politics Fix.”

And some Republicans were caught using the instant messaging system called Twitter during the president‘s speech last night.  We‘ll have that in the HARDBALL “Sideshow,” where it belongs.

But we begin with two former members of Congress, Harold Ford, Jr., who‘s now an MSNBC political analyst, and Tom DeLay, the former Republican leader of the House.  I want to start with Tom DeLay.  We‘ll do it by rank of position in the old days.  Mr. DeLay, what did you make of the speech last night?

I want to give you a look at both gentlemen.  Here‘s the president talking about the economic crisis we face in the country, and then the response by Governor Jindal.  Let‘s look at them together, this piece.


OBAMA:  Now is the time to act boldly and wisely, to not only revive this economy but to build a new foundation for lasting prosperity.  Now is the time to jump-start job creation, re-start lending and invest in areas like energy, health care and education that will grow our economy even as we make hard choices to bring our deficit down.



GOV. BOBBY JINDAL ®, LOUISIANA:  To solve our current problems, Washington must lead, but the way to lead is not to raise taxes, not to just put more money and power in the hands of Washington politicians.  The way to lead is by empowering you, the American people, because we believe that Americans can do anything.


MATTHEWS:  Mr. DeLay, I like that.  It was a clear distinction between the parties.  What did you think?

TOM DELAY (R-TX), FORMER HOUSE MAJORITY LEADER:  Listening to your introduction, somebody‘s going to accuse you of being biased.  I tell you, this speech—and I‘ve heard a lot of speeches on the floor of the House and a lot of State of the Union speeches and speeches before joint sessions, and this was the most irresponsible and hypocritical speech I‘ve ever witnessed.

The president starts out by saying we have to take responsibility for our future, and then the rest of his speech is nothing but government taking responsibility for your actions.  He talks about—he even said, I don‘t believe in bigger government, and then his whole speech is about bigger government.  And the hypocrisy of talking about and saying that he has found $2 trillion that he‘s going to cut out of the government, when he just passed a $1 trillion spending bill and signed it last, week and today the House passed a bill that‘s $410 trillion -- $410 billion—the spending goes on and on.

He‘s talking about higher taxes, more regulation, more government control.  Everything he talked about in helping the economy is going to hurt the economy.  It‘s insane, what he‘s talking about.

MATTHEWS:  OK.  Let me hear Mr. Ford‘s view.


Now that we‘ve got the rank thing out of the way, what Mr. DeLay just laid out was formerly comprehensively and completely rejected by the people back in November.

What Obama did last night was really usher in a new era of patriotism, redefined it, redefined it using three tenets.  One, service to the country.  He called on educators and students and families, moms and dads to be better moms and dads and be better students and be better Americans.  Two, innovation.  He talked about the need to build an innovation economy, to help us grow our way out of this awful mess we find ourselves in.

And three, investment.  He talked about using the power of government combined with the ingenuity of the private sector to help us find our way out of this terrible moment that so many families, especially middle class and poor working Americans, who have really borne the stress and hardship of the recession that we find ourselves in.

As much as I like personally my friend, Tom DeLay, I just think he‘s completely wrong.  We find ourselves at a new moment in America.  The country is anxious and eager for a different kind of leadership—investments in education, energy and health care.

You may just philosophically disagree, Tom, with the direction the president wants to take us.  But for you and all of my Republican former colleagues in the Congress to talk about deficits, to talk about debt—we welcome that conversation from you today, but you must be reminded you helped land us right where we are today.  And the reason that my friend and our president found himself having to give the kind of speech he gave last night was largely because of some of the decisions and the direction that your leadership and your majority took us in.  But that‘s in the past.

DELAY:  Harold...

FORD:  It‘s now time to move forward...

DELAY:  Harold...

FORD:  ... and I appreciate what the president said.

DELAY:  You‘re not in the Senate.  You‘re not in the Senate.

FORD:  And you‘re not in the Congress.

DELAY:  So—you don‘t get all the time.  Let me just say, first of all, you talk about education.  What he‘s talking about is nationalizing education.  He said it.  We‘re going to take care...

FORD:  That‘s not what he‘s talking about.

DELAY:  That‘s what he said.  I‘m just taking what he said.  And at the same time, he‘s talking about taking—bigger government taking over already failed government schools, he is today...

FORD:  He called for more investment in charter schools, Tom.

DELAY:  Wait.  Let me finish!  Let me finish.  I let you finish.  He is—he is—he is driving out his daughter‘s classmates by removing the voucher system for underprivileged children in Washington, D.C., in the bill today.  Two thousand children in Washington, D.C., get to go to private schools on the voucher system, and they eliminated it today in the House of Representatives.  And the classmates that go to school with the president‘s daughters are going to be run out of that private school.  I mean, you talk about hypocrisy!

FORD:  The president last night called for greater support for charter schools.  I‘m a supporter of that voucher program.

DELAY:  Well, he‘s doing away with vouchers.  It‘s amazing!

FORD:  I‘m a supporter of that effort there in Washington.  But Tom, let‘s be clear.  The overall goal and the mass of ideas that were presented last night...

MATTHEWS:  I‘m with you, Mr. DeLay, on that one, by the way.  I‘m for vouchers.  But go ahead.

FORD:  I supported that in the Congress, Chris.  But the question is we don‘t know what the president may do on the bill.  But there‘s a larger issue here and a larger philosophical divide.  My Republican friends believe we ought to travel in a certain direction.  Matter of fact, they took us in that direction the last seven or eight years.  We‘re now prepared to travel a different path.

I anticipate and expect my friend Tom to have differences with the president.  But to say that this is the worst speech, the most irresponsible speech you‘ve heard by a president, who talked about a new America, who talked about protecting America—we may disagree...

DELAY:  Harold...

FORD:  ... with the approach and the way we go about doing it, but you have to say...

DELAY:  Harold, Harold...

FORD:  You have to agree, Leader DeLay...

DELAY:  We are in a crisis.  We are in an economic crisis...

FORD:  We certainly are.

DELAY:  ... a crisis that was brought on by Americans and American business and corporations living beyond their means and being too far in debt.  And what is the president‘s answer to that?  Is driving up the cost to families, driving up the cost to business to do business through his health care, his energy plan and his education plan and his government plan, by raising taxes.  That‘s not going to help the economy.  That‘s going to hurt the economy.  I mean...

FORD:  If you turn out to be right, Leader DeLay...

MATTHEWS:  OK, let‘s—let‘s...

FORD:  ... he will not be reelected, and he has made that clear.  He understands...


DELAY:  He‘s not going to be reelected, that‘s for sure!

FORD:  But Charlie Crist, Arnold Schwarzenegger...

MATTHEWS:  OK, let me...

FORD:  ... the great governor of Vermont, they‘re great—they‘re Republican governors who all believe that this is what‘s needed to help them get their economies...

DELAY:  Two governors—two governors that are dead wrong...


DELAY:  ... and have driven both their states into the economic toilet.

MATTHEWS:  OK.  Let‘s—on that word “toilet,” let‘s move back to the president of the United States last night and to the Republican respondent.  Here they are again, President Obama and Governor Jindal.


OBAMA:  In each case, government didn‘t supplant private enterprise, it catalyzed private enterprise.  It created the conditions for thousands of entrepreneurs and new businesses to adapt and to thrive.  We are a nation that has seen promise amid peril and claimed opportunity from ordeal.  Now we must be that nation again.  That is why, even as it cuts back on programs we don‘t need, the budget I submit will invest in the three areas that are absolutely critical to our economic future—energy, health care and education.



JINDAL:  Democratic leaders say their legislation will grow the economy.  What it will do is grow the government, increase our taxes down the line and saddle future generations with debt.  Who amongst us would ask our children for a loan so we could spend money we do not have on things we do not need?  That is precisely what the Democrats in Congress just did.  It‘s irresponsible and it‘s no way to strengthen our economy, create jobs or build a prosperous future for our children.


MATTHEWS:  Now, here‘s New York (SIC) columnist David Brooks last night on PBS, talking about the performance by Governor Jindal.


DAVID BROOKS, “NEW YORK TIMES” COLUMNIST:  I think Bobby Jindal is a very promising politician, and I opposed the stimulus package because I thought it was poorly drafted.  But to come up at this moment in history with a stale, government is the problem, we can‘t trust the federal government—it‘s just a disaster for the Republican Party.  There‘s an intra-Republican debate—some people say the Republican Party lost its way because they got too moderate.  Some people say they got too weird or too conservative.  He thinks they got too moderate, and so he‘s making that case.  I think it‘s insane and I just think it‘s a disaster for the party.  I just think it‘s unfortunate right now.


MATTHEWS:  Mr. DeLay, that‘s another conservative view of the opposition‘s voice last night.

DELAY:  Whoa!  Whoa!

MATTHEWS:  What did you make—go ahead, your thought.

DELAY:  Chris, first of all, take away the conservative moniker for David Brooks.  Let‘s start there.  Secondly, if you look at the record of Governor David (SIC) Jindal when he came into Louisiana, it is a stellar record that got their economy growing again, that imposed ethics into the government.  And he understands less government, lower taxes, allows people to make the kinds of decisions they need to make to create jobs.  He did it in Louisiana.  Unfortunately, President Obama is going to do just the opposite by imposing taxes, regulation and bigger government.

MATTHEWS:  Mr. Ford, your response to both comments last night?  What did you make of Governor Jindal‘s response—well, it‘s been accused of being nihilistic, a completely opposition to government point of view.  Government‘s bad, let‘s get rid of it.

FORD:  I know Bobby.  I served with him in the Congress, one of the brightest and most creative thinkers, particularly around the health care rubric (ph) that I met.  I thought he had a tough night last night.  I would agree with David Brooks.  I don‘t know if he—if David Brooks is a liberal or a conservative.  I know he‘d probably not call himself a liberal.  But I thought his take on it was about right, that—the stale paradigm of big government, small government, more taxes, Democrats want more, we want less, won‘t work right now.

What Obama did last night was to demonstrate to the country that he‘s thinking long and hard about the issues.  He‘s thought long and hard about them.  He‘s not going to be blindsided, or for that matter, he‘s not going to allow ideology from Democrats or Republicans to guide him.  He‘s going to do what‘s best for the country and try to lead.

There will be honest differences.  I respect Tom‘s differences with the president.  I respect Bobby‘s differences with the president.  But the reality is, big government didn‘t get us into the problem we find ourselves in today.  Big government alone won‘t take us out of it, and I think President Obama last night acknowledged that.  Investments in new energy, in clean coal and nuclear and solar, in geothermal...


FORD:  We can laugh all we want, Tom, but the reality is there are many in this, there are many in this country...

DELAY:  The reality is...

FORD:  There are many in this country believe that that‘s what will get us out of this mess.

DELAY:  Harold, I love you, Harold...

FORD:  And I respect you, but the president had every right to lay that out last night, and you have every right to disagree.

DELAY:  Harold, his—his energy plan...

MATTHEWS:  Last word, Mr. DeLay.

DELAY:  His energy plan is to take over the entire economy by his cap and trade program.  That—that is...

FORD:  That‘s not his energy plan, Tom.  That‘s not fair.

DELAY:  That‘s what he said.

FORD:  That‘s not fair.

DELAY:  He—cap and trade is taking...

FORD:  (INAUDIBLE) clean coal last night, Tom (INAUDIBLE)

DELAY:  If I could finish?  I let you finish, Harold.  Cap and trade regulates the entire economy using energy.  That is going to destroy our economy.  And not only that, it‘s going to even—it‘s going to drive up the cost of energy for businesses.  They‘re not going to create the kinds of jobs we want because the cost of energy is going to go up.  The cost of health care is going to go up.  Efficiency in health care by the government taking over our health care system in America?  When was the last time government did anything that was efficient?  I mean, everything that he talked about is going to drive our economy into the toilet!

FORD:  Chris, the real difference is, Mr. DeLay doesn‘t believe...

MATTHEWS:  You keep saying that word.

FORD:  ... that government works, and I believe government can work.  And we—that‘s where the rub is here.  Government can work if you have good people running it.

MATTHEWS:  OK, I got to ask Mr. DeLay—Mr. DeLay, do you think President Bush was a successful president?

FORD:  Pretty much so, yes, especially on foreign policy and fighting the war on terror.  He was very successful.  And he was very successful up until September.  You have to remember, Chris, for the last two years, you had a Democrat Congress.  And the Democrat Congress tried the bail-out.  It didn‘t work.  They tried a housing program.  It was a joke.  And then they came up in September with this bail-out that had—that bailed out corporations instead of looking at the real root of the problem that we have in our economy.  And he was wrong there.  He was absolutely wrong.  And that‘s unfortunate.


MATTHEWS:  Some night, we have to have a debate on this program between the Republican principles you subscribe to, Mr. DeLay, and the Republican policies we‘ve gotten because there is a discrepancy.  I think Governor Jindal tried to talk about that last night, but not enough.  The party cannot run on its record.  It can run on its fundamentals.  It‘s a question of which they‘re going to run on next time.

Thank you, Mr. Ford, Mr. DeLay.  It‘s always—Mr. DeLay, you‘re always welcome on this program.

DELAY:  Thank you, Chris.  Take care.

MATTHEWS:  Coming up: What President Obama said last night versus what he meant.  We got some hidden meanings here last night, according to VandeHei, Jim VandeHei of “The Politico.”  He‘s got some translation for you.  And I think you‘re going to agree with Obama—the president really meant is not exactly the words he used.

You‘re watching HARDBALL, only on MSNBC.


MATTHEWS:  Welcome back to HARDBALL.

President Obama and his speechwriting team picked the right words for the right moments last night.  But were there spots in his speech where the president meant something slightly different than what he said?  You bet there were. 

“The Politico”‘s Jim VandeHei co-wrote a piece today on that topic. 

We‘re also joined by Lynn Sweet of “The Chicago Sun-Times.” 

This is going to be fun. 

Jim, I want you to watch this tape from the president last night. 

Here‘s the president on how we got into the trouble we‘re facing right now.


MATTHEWS:  And then respond to what you think he‘s really talking about. 


BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  Now, if we‘re honest with ourselves, we‘ll admit that for too long we have not always met these responsibilities, as a government or as a people.  I say this not to lay blame or to look backwards, but because it is only by understanding how we arrived at this moment that we‘ll be able to lift ourselves out of this predicament. 


MATTHEWS:  Jim VandeHei, not to place blame—he says he‘s not blaming anybody for the predicament...


MATTHEWS:  ... he inherited. 


VANDEHEI:  He said it precisely to lay blame on Bush. 

I mean, throughout the speech, I think there was four or five different references where it‘s crystal clear that he‘s saying, listen, I didn‘t start this fire.  I inherited a terrible economy, a big deficit, a regulatory system that allowed the shenanigans to take place.  And now I‘m here to clean up the mess. 

And I think he wants the American people to think, every time he does anything, any time he takes a risk or spend money, that he‘s doing it to clean up a mess that he inherited, not that he created.

MATTHEWS:  God, it‘s Billy Joel.  We didn‘t start the fire, right? 


VANDEHEI:  There you go.

LYNN SWEET, “THE CHICAGO SUN-TIMES”:  Well, this is the thought bubble.  This is why this is a great piece that they did.

You have to decode a speech like this, Chris.  And—and this is the thought bubble of what you think he‘s thinking and what the words are meaning. 

MATTHEWS:  Well, there‘s a—not to knock anybody in history, but

there‘s a Nixonian element here.  Richard Nixon was famous—or infamous -

for saying things like:  I don‘t think the Supreme Court is packed with communists.  Some people do. 


SWEET:  Well, you know, that‘s when—the corollary to that is when people say, I want to be very—I don‘t—to tell you the truth, when people start saying that. 


SWEET:  But here‘s the thing.  I—I characterize this as a roller-coaster speech. 

He takes you plunging to the depths of despair—miserable economy, bleak future.


SWEET:  And, then, at the end of every two paragraphs, or three, he paces himself:  You know, we‘re creeping back up—you know, up the roller coaster again. 

MATTHEWS:  Yes, like a choo-choo.

Well, here‘s the president again on the lessons of history, for you, Jim. 


OBAMA:  ... for history tells a different story. 

History reminds us that, at every moment of economic upheaval and transformation, this nation has responded with bold action and big ideas. 

In the midst of civil war, we laid railroad tracks from one coast to another that spurred commerce and industry. 


MATTHEWS:  Translation, Mr. VandeHei? 

VANDEHEI:  I love this one, because it—it reminds me of that—what Rahm is always saying.  Rahm Emanuel said, never let a good crisis go to waste. 

Obama wants to do huge things and spend money that we have never before considered spending in this country.  And he‘s saying, look it, we‘re in a mess.  It‘s an historic mess.  Let‘s do historically big things. 

MATTHEWS:  Yes, using—using emergencies to get done what you wanted to get done already is what some people believe Richard Cheney—Dick Cheney—and President Bush did in getting us into Iraq -- 9/11 was used, a crisis was used to get us to go where they wanted us to go in the first place. 

SWEET:  Well, one...

MATTHEWS:  Same deal, right? 

SWEET:  One of the things that Obama is doing with this...


MATTHEWS:  You don‘t want to agree to that, do you? 


SWEET:  I think the parallel construction can—OK, yes, I agree that Obama is using the crisis to do what he wanted to do anywhere on the campaign trail, and now, instead of calling it my policy agenda, he is saying this emergency spending is to prop up the economy, same thing, health care, energy, education. 

These proposals aren‘t new.  The packaging is.  And that‘s why, remember...


SWEET:  ... the White House just made an appointment this week of somebody in charge of message management. 

So, we‘re dealing with a presidential agenda here that is also clothed in the emergency that we‘re in. 

MATTHEWS:  Right.   

Here‘s President Obama on the issue of taxes, which is always a good Republican issue.  Nobody likes them.  They—the two parties have different attitudes about taxes, I think.  Democrats think taxes are part of paying for government.  Republicans see them as punishment to be avoided, simply put. 

Here it is. 


OBAMA:  In order to save our children from a future of debt, we will also end the tax breaks for the wealthiest 2 percent of Americans. 


OBAMA:  Now, let me be clear.  Let me be absolutely clear, because I know you‘ll end up hearing some of the same claims that rolling back these tax breaks means a massive tax increase on the American people.  If your family earns less than $250,000 a year, a quarter million dollars a year, you will not see your taxes increased a single dime.  I repeat: not one single dime. 


OBAMA:  In fact...


MATTHEWS:  The translation, Jim? 

VANDEHEI:  If you‘re rich, watch out.  You‘re going to get hit with a big, fat tax hike, probably next year, when they let some of these Bush tax expire. 

And he‘s basically saying, listen, somehow, I have got to pay for all these programs.  I have just promised to cure cancer, put every kid through school, give you universal health care coverage.  Somebody has got to pay for it.  The rich are going to pay for it.  It‘s a fight I‘m willing to have.  You might say that tax hikes are dangerous politics. 

He‘s sort of John Kerry.  Bring it on. 

SWEET:  And one thing, that is a real tested line.


SWEET:  He used that throughout the campaign.  He never got a negative response to that one.  I mean, they knew how...


MATTHEWS:  Well, as the economy thinks, fewer and fewer people think they‘re going to pass that $250,000 threshold. 

SWEET:  Yes. 


MATTHEWS:  That‘s the problem for a lot of people. 

Anyway, thank you, Jim VandeHei.

Or anywhere near it.

Thank you, Jim VandeHei.  Great reporting.  I love this analysis. 

Thank you, Lynn Sweet, as always.

Up next:  So, what were Republican members of Congress thinking during President Obama‘s speech last night?  Well, a couple of them were caught using that instant-messaging system called Twitter.  And they were atwitter, and some were tweeting themselves or being tweets by putting out tweets right in the middle of that—that speech last night.  If you noticed, their fingers were out of sight. 

You‘re watching HARDBALL, only on MSNBC.  


MATTHEWS:  Back to HARDBALL, and time for the “Sideshow.”

First up:  Twinkle, twinkle little Twitters.  It looks like the president‘s address last night wasn‘t quite riveting enough, didn‘t hold the attention second by second, for a certain crowd of text-savvy pols sitting out there in that chamber last night. 

Here are some of the text messages that Twittered out of the Capitol while President Obama was actually speaking. 

Republican Congressman Joe Barton‘s Twitter account broadcasted this message on his—to his online followers—quote—“Aggie basketball game is about to start on ESPN2 for those of you who aren‘t going to bother watching Pelosi smirk for the next hour.”

Hmm.  Not long after came this follow-up: “Disregard that last tweet from a staffer.”

Another text message was Twittered from fellow Texan, also a Republican, U.S. Congressman John Culberson.  Upon listening to Obama‘s outline of the budget, he Twittered: “Hold on to your wallet, America.”

When Obama paid tribute to service men and women, across came this Culberson Twitter: “We are at war.  It seems to me honoring our troops should come on page one, rather than at the end of the speech.”

Having offered up these real-time critiques, Congressman Culberson capped his correspondence with a roundly bipartisan encomium: “This is a great privilege to be here and I will try hard to find ways to work together, while preserving my core principles.” 

Democrats were also a-Twitter last night.  Oregon Congressman Earl Blumenauer notes, upon catching the scene at the big desk: “One doesn‘t want to sound snarky, but it is nice not to see Cheney up there.”

Personally, it was nice to see regular guy Joe Biden up there last night. 

Anyway, up next:  President Obama plans to bring home more than half the U.S. troops serving in Iraq.  Let‘s get it straight.  He‘s bringing it down to below 50,000.  He‘s starting now with 142,000. 

During the campaign, he promised to bring everyone home within 16 months.  He actually promised to bring all the combat troops.  He‘s sticking to his word.  Let‘s talk about it. 

We will be right back with that.

You‘re watching HARDBALL, only on MSNBC.  


SHARON EPPERSON, CNBC CORRESPONDENT:  I‘m Sharon Epperson with your CNBC “Market Wrap.”

Stocks finishing lower today—the Dow Jones industrials shed 80 points.  The S&P 500 lost eight, and the Nasdaq dropped 16 points. 

The day started with more troubling news about housing.  Existing home sales unexpectedly plunged more than 5 percent in January from the previous month.  Sales fell to the lowest level in nearly 12 years. 

President Obama wants Congress to pass tough new regulations for the financial industry.  He spoke late this afternoon, after discussing stricter government oversight with Treasury Secretary Tim Geithner and key lawmakers. 

Meantime, banking regulations launched a new stress test program to assess the ability of large banks to cope with a deeper and longer-than-expected recession. 

And Fed Chairman Ben Bernanke told Congress for a second straight day the federal government is not interested in taking over troubled banks. 

That‘s it from CNBC, first in business worldwide—now back to



OBAMA:  I am now carefully reviewing our policies in both wars, and I will soon announce a way forward in Iraq that leaves Iraq to its people and responsibly ends this war. 



MATTHEWS:  Welcome back to HARDBALL.

President Obama is expected to announce later this week, perhaps by Friday or earlier, that he‘s going to withdraw combat troops from Iraq in 19 months, and leave a residual force of approximately 50,000 troops in that country. 

Take a look at what he said during the campaign. 


OBAMA:  There is no military solution in Iraq, and there never was.  I will begin to remove our troops from Iraq immediately. 


OBAMA:  I will...


OBAMA:  I will remove one or two brigades a month, and get all of our combat troops out of Iraq within 16 months. 


MATTHEWS:  Christopher Hitchens, a “Vanity Fair” columnist, and one of the best there is, and Joe Conason is with “The New York Observer,” a great newspaper.  He‘s also author of the book “It Can Happen Here.” 

Joe, I‘m curious to hear your view on this.

People are already calibrating the extent to which he stuck to his campaign promise of ending this war in Iraq and bringing home the troops.  Is he going to do it? 


Well, I guess we will find out in 19 months, Chris. 

But the really key question here is not how many months.  It is what the mission is of the troops who are left, how many there are, how many of them are combat troops.  And I think, if there‘s a debate over this, it will arise over those issues, and not—not the length of time. 

MATTHEWS:  Can we fight a war with a—with a complement of troops, no matter how they‘re described, combat training, assistant, or whatever—can we fight a war over there with 50,000 or so troops?

CONASON:  Well, I...

MATTHEWS:  Or does that number itself tell us what our policy—our mission is going to be...

CONASON:  Well...

MATTHEWS:  ... which is basically hold, and leave eventually? 

CONASON:  I think it is—I think it is leave eventually, at the behest of the Iraqi government, after all.  We have a status-of-forces agreement that requires us to leave a year-and-a-half after that scheduled withdrawal, so, have all our troops out at the end of 2011. 

So, the Iraqis evidently believe that, sometime between the summer of 2010 and the end of 2011, they will be able to deal with whatever issues they still have on the ground there. 

MATTHEWS:  Christopher, your thoughts about what the president‘s—the stuff that has leaked through.  Jim Miklaszewski of NBC News has reported the president is going to make a dramatic cut, maybe not all the combat troops, but almost all of them. 

CHRISTOPHER HITCHENS, CONTRIBUTING EDITOR, “VANITY FAIR”:  Yes, but he has been saved by Prime Minister Maliki. 

You see, once the Iraqis start saying, we would like you to go, then the Democrats are sort of off the hook.  And it‘s people like McCain who look out of step. 

MATTHEWS:  But didn‘t McCain cheer last night when—when he said, we‘re going to end that war? 

HITCHENS:  Sure.  Nobody wants the war to go on, but we have to stay within swatting distance of al Qaeda in certain provinces.  We have to keep our promises to the Kurdish people, the autonomous area in the northeast of the country. 

These are people we have let down before we can‘t possibly let down again.  And we have a commitment to federalism and to overseeing, as far as possible, the...


MATTHEWS:  Well, do you see our government being able to be the guarantor—you know how the French sent in the paratroopers whenever one of their neocolonial relationships falls apart, when one of their governments in West Africa...


MATTHEWS:  ... falls to a terrorist group—not a terrorist group—a revolutionary group?  They sent in the French paratroopers to stabilize conditions and restore that government.  Is that the role we‘re going to play? 


HITCHENS:  It was the French who armed the people who committed the genocide in Rwanda...

MATTHEWS:  Well, is that what we‘re going to do?

HITCHENS:  ... the French who bombed the Ivory Coast, without ever consulting the United Nations, by the way.  These are the people whose criticisms we were supposed to be listening to.

MATTHEWS:  OK.  I have launched you on a turn here.

HITCHENS:  Yes.  You shouldn‘t have started me... 


HITCHENS:  ... the Iraq fight.

MATTHEWS:  Are we—do we have enough troops there, if we have 50,000 or so troops left, to—to do all the things you say you want us to do, protect the Kurds, fight al Qaeda, et cetera? 

HITCHENS:  Yes.  I think we can say hole down, slightly under the horizon.  Everyone knows that we‘re there, but we‘re not providing targets on the street, and it doesn‘t look like an occupation.  And it‘s a deal made with an elected Iraq government, whose election we enabled. 

MATTHEWS:  And we would eventually have to leave in total?  You accept the need to leave it in total, because Maliki‘s government says to leave within a year-and-a-half after that drop, that pullback? 

HITCHENS:  I‘m not going to be more extreme than the Iraqi parliament was. 


HITCHENS:  They can ask us to stay as well, and I would be—I would be happy to consider it. 

CONASON:  The problem will come, Chris, if we start to sustain a lot of casualties again sometime before the—before the status-of-forces agreement goes into effect, and all of our troops are supposed to leave. 

If we start to sustain casualties sometime next year, then, you know, there will be calls from some generals to stop the withdrawal, perhaps.  And the president will be facing a dilemma at that point, because there will be more pressure for us to leave from—from—from domestic politics. 

MATTHEWS:  Well, let‘s talk common sense here. 

The people—the people that have been waiting us out, whether it‘s Sistani, al Sadr, whoever it is over there, the insurgent Sunnis or the military-trained now, and equipped majority over there, the Shia—somebody‘s going to see an advantage in us leaving.  Who‘s going to take advantage of us leaving? 

HITCHENS:  Remember what the president said in his inaugural speech.  He said anyone who thinks you can just outlast us will be mistaken.  You can‘t outlast us.  We will defeat you. 

I think it ought to be credible.  We‘re not going away from the region.  The Gulf is the choke point of the world economy.  We and other allies have many bases there, many interests.  If we were not there, others would invade, Iran might.  Saudi Arabia might.  The Russians might take a hand. 

Nobody wants—nobody wants any other superpower but ourselves to be doing this.  What you should, I think—if we have a minute—ask is this: do people understand how much the president is committing the United States to an endless war in Afghanistan? 

MATTHEWS:  I know that‘s a question.  And I worry—

HITCHENS:  He wants to draw down these soldiers for what?  Not just so they come home and embrace their wives and husbands and children, but so they can go to Afghanistan. 

MATTHEWS:  I worry. 

HITCHENS:  If you want a war that has no end in sight and it is a war also with a supposedly allied country Pakistan, that‘s what—

MATTHEWS:  You know what I worry about, Joe?  I‘m older than you.  I worry about this scenario.  I lived through it in the ‘60s.  The liberals said, let‘s not fight in Laos.  That‘s indefensible.  But we‘ll hold on as a moderate position, which liberals often take, somewhere in the middle, but we will defend South Vietnam.  That became the Vietnam War.  That became the best and brightest war of the Democratic party of John Kennedy and Lyndon Johnson. 

Could this be another scenario whereby the Democrat president, Barack Obama, thinks he‘s taking a moderate position and, in fact, he‘s getting deeper into the sand over there, because it is harder to fight that other war in Afghanistan.  Isn‘t it?  And to claim anything like a victory in our lifetime? 

CONASON:  First of all, I think the president believes that having a date certain to withdraw from Iraq, at the behest at the Iraqi government, ought to encourage the parties there to settle their own differences, ultimately peacefully.  I think that‘s at least the hope and that was the hope of the Iraq Study Group when they recommended this kind of course, that you make the Iraqis cope with their own problems, deal with their own issues, and you tell them we‘re not going to be there forever. 

I think on some level, you want to do something similar in Afghanistan.  We need some kind of military presence, with our allies, either in or around Afghanistan, to make sure that the people who wish us harm, who are still there, are curbed, and disarmed if possible.  You need to—the maximum ability to curb al Qaeda wherever it is. 

HITCHENS:  I only meant to say, Christopher, that the model on which Obama ran, President Obama ran, there‘s one bad war that we can‘t win and one good war that we should be trying to win.  It is almost certainly exactly wrong.  Iraq matters much more to us.  It‘s an incredibly rich country.  It‘s geo-strategic.  It‘s geo-economical.  Afghanistan is none of these things.  

CONASON:  But they‘ve asked us to leave.

MATTHEWS:  Who has asked us to leave?

CONASON:  The Iraqis asked us to leave.  We‘ve agreed to leave.  We signed a document saying we‘re leaving. 

MATTHEWS:  The Afghan people have destroyed the Soviet empire.  They‘ve destroyed the British empire.  They‘ve destroyed every Westerner or Northerner, if you will, that‘s ever come in their country.  They‘ve gobbled them up eventually.  How do we avoid that historic almost inevitability?  Joe? 

CONASON:  Well, I think it‘s what the president said about Iraq is also true in Afghanistan, that there is no solely military solution to the problems in Afghanistan, and we have to tread very cautiously there.  I would say that this president is not—

HITCHENS:  He‘s proposed no solution.  He‘s proposed nothing except more troops.  People who say there is no military solution are usually being glib, and are saying they‘re not sure. 

CONASON:  I said there‘s no sole military solution to this.  There‘s the—if you took the same tack that you took in Iraq, you would in fact negotiate with a lot of the people trying to kill you.  That‘s what they did in Iraq. 

MATTHEWS:  Northwest frontier province of Pakistan, where bin Laden probably is, that‘s where the real problem is.  Thank you, Christopher Hitchens.

HITCHENS:  Pleasure. 

MATTHEWS:  Welcome back from overseas.  Joe Conason, thank you. 

Up next, Governor Bobby Jindal had a tough act to follow last night with his Republican response to the president.  By most accounts, even from some Republicans—not all, we heard from Tom Delay.  Some think he fell short, like Brit Hume didn‘t like the job he did last night.  David Brooks didn‘t like it.  Of course, if you say things like that, you‘re immediately called not a conservative.  What does that mean for the opposition when Republicans are criticizing a fast-rising star in their party?  The politics fix, it‘s going to be hot, coming up on HARDBALL.



GOV. BOBBY JINDAL ®, LOUISIANA:  So where we agree, Republicans must be the president‘s strongest partners.  And where we disagree, Republicans have a responsibility to be candid and offer better ideas for a path forward. 

Today in Washington, some are promising that government will rescue us from the economic storms raging all around us.  Those of us who lived through Hurricane Katrina, we have our doubts. 


MATTHEWS:  I don‘t know.  That was of course Governor Bobby Jindal last night from Louisiana, a fast rising figure in the Republican party, giving the Republican response from the governor‘s mansion down there in Baton Rouge.  We have Ron Brownstein joining us right now from—he‘s from “National Journal.”  And Michael Scherer is White House correspondent for “Time.”

Gentlemen, thank you for joining us.  What do you think?  I want to give you, no cues, your views.  Ron Brownstein, Bobby Jindal‘s performance last night, the backdrop, everything, the performance, the stage craft from the beginning to end.   

RON BROWNSTEIN, “THE NATIONAL JOURNAL”:  The delivery was not good.  The delivery wasn‘t good.  The stage craft wasn‘t good.  But the bigger problem was the message and the context of the message.  You have a Republican party that after the Bush years is overly dependent on and overly defined by the south, and is struggling elsewhere, in other regions of the country. 

To deal with that, they pick a southern governor from a state that ranks 49th in median income, a state that is second to the bottom in average median income—

MATTHEWS:  And heavily dependent on federal money. 

BROWNSTEIN:  And from that state, at that position, offers a message, essentially a reflexive anti-government, traditionally southern message that plays with the base and in that region.  But again, you have to wonder if it‘s relevant elsewhere, and if you really want to point to Louisiana and Baton Rouge as your economic alternative to what Obama was laying out. 

I think it kind of reinforced the sense in which the Republican party is emerging in this era as overly dependent in the south and having trouble escaping the impulses of the south to define a message to reach out. 

MATTHEWS:  You got to wonder, if you‘re somebody like Senator Specter of Pennsylvania, or you‘re worried about a purple county somewhere in the northeast, or Ohio, you think, wait a minute, this guy‘s going to help us getting out of the ditch?

MICHAEL SCHERER, “TIME MAGAZINE”:  Talking about Hurricane Katrina, of all things? 

MATTHEWS:  Bringing back the worst case of mismanagement by the federal government, by a Republican president.  That was a personal screw up.  It wasn‘t the government.  People can account that to the president.  They don‘t all despise President Bush.  They believe he was off duty that week.  He just wasn‘t working. 

SCHERER:  I think there are two things.  There was a delivery problem. 

There was a sort of sing song quality to the whole thing. 

MATTHEWS:  Yes, in the delivery.

SCHERER:  It was as if he was reading a child a book before he went to bed.  There was sort of this labored delivery.

MATTHEWS:  Here‘s what Brit Hume said about it.  He is a pretty solid reporter.  I think he‘s a conservative.  He said “the speech read a lot better than it sounded.  This was not Bobby Jindal‘s greatest oratorical moment.”  Your point.   

SCHERER:  That‘s true.  The other big thing is the Republicans have yet to figure out how to create their ideological message, which is that we don‘t want more big government, and then combine that with what the American people want know, which is somebody to help them, some answer.  They haven‘t figured out how to do that. 

MATTHEWS:  Didn‘t it sound like—not to knock it, I have friends who are libertarians.  It sounded like Bobby Jindal, the governor, was giving a libertarian manifesto, not a Republican party manifesto.  In other words, government is bad, taxes are bad, don‘t rely on government, do it yourself, survive on your own.  It‘s almost survivalist.  It wasn‘t a Republican point of view. 

BROWNSTEIN:  There‘s a risk that Obama can push this too far on too many fronts and there could be a recoil from the public that he‘s adding too much to the expanse and reach of government and the expense of government.  But what Jindal offered yesterday, you‘ll appreciate, I thought was a distant echo of what you heard the Dixiecrat arguments in the south in the 1930s against FDR, Gene Talmidge or Walter George.  Basically, the traditional southern argument that too much government is going to inhibit economic growth.

When, ironically, in the same speech that Obama laid claim to the economic legacy of Abraham Lincoln, the first Republican president, by talking about the building of the trans-continental railroad, which was done by the Republican Congress and the first Republican president.  You a Republican response that kind of echoes the Dixiecrat arguments of the ‘30s.  An incredible role reversal of parties. 

MATTHEWS:  Could this be good for Jindal, not good for the Republican party?  Could it be good at positioning him out there on the right with Governor Palin, Huckabee, people like that.  If that‘s the fight, who wins the right-word rail?  Maybe he‘s still there.  He‘s in good shape. 

SCHERER:  Jindal—I don‘t think this rules Jindal out in anyway.  We‘re a long way away from 2012.  Jindal is already a celebrity among the right.  They already know him.  They already have great respect for him.  The issue for Jindal is introducing himself to the rest of the country.  If this is his first introduction, it is a problem.  Over time, he is going to have to find a way to get beyond it.  It doesn‘t mean he can‘t get beyond it. 

BROWNSTEIN:  Don‘t you think the issue for the Republican party is finding someone who can compete again on the east coast, on the west coast.  They lost every state from Maryland to Maine, did not get within single digits.  They lost every state on the west coast.  Ultimately, you need a candidate who can talk to people in Bergen County and Silicon Valley and Fairfield County, Connecticut.  

MATTHEWS:  The suburbs run every election. 

BROWNSTEIN:  Was that a message and a messenger that is ultimately a response to that problem? 

MATTHEWS:  I think the Republican leadership gave away an opportunity to defend establishment government.  They turned it over to somebody who wasn‘t really involved in leading the Republican party for the last eight years, so they can say it wasn‘t our fault.  Since President Obama‘s address last night, we‘ve been asking viewers to text us, text us, whether his speech gave them confidence.  Did it give you confidence?  Look at these results, 91 percent say yes.  You never know about the way people decide.  Clearly, the people that wanted to participate were very impressed. 

We‘ll be right back with Ron Brownstein and Michael Scherer for more of the politics fix.  We‘re going to talk about some fascinating things going on in Washington with the conservatives.  They‘re coming to town.  You‘re watching HARDBALL.


MATTHEWS:  We‘re back with Ron Brownstein and Michael Scherer for the politics fix.  Before we go on to something fun here, the Republicans coming to town, I was stunned last night by the way in which the first lady wowed that audience.  The way she came, the outfit, the way the president paid tribute to her, knowing that this was the best applause line of the night.  It was nice.  It was hip.  It was today.  It was youthful.  A real change of pace. 

Anyway, the Conservative Political Action Conference has the following panels on tap for the next weekend, if you want to come to town here: “Al Franken and Acorn, How Liberals are Destroying the American Election System.”  Here‘s another breakout session, “Bailing Out Big Business, Are We All Socialists Now?” 

Here‘s another one, “The True Cost of Global Warming Hysteria.”  So if you can‘t catch a Star Trek convention, you‘ve got C-PAC coming here.  It‘s always fun.  I grew up as a conservative.  I liked a lot of this stuff.  Its kind of groupie stuff.  Interesting curios you can pick up at these things, chotchkies.  It‘s fascinating to watch the real conservative movement.  Will this become a launches pad for the next Republican nominee, the way it was for Ronald Reagan back in the ‘70s? 

BROWNSTEIN:  Well, C-PAC has become a very almost student-oriented weekend away in Washington.  Look, the problem the conservatives have is that Obama is with a big majority in both the House and Senate, bigger majorities than Republicans had in any point in their 12 years of control.  He is shifting the center of debate.  And he is challenging them in a very direct way that provokes a reaction from the right, but also may make it harder for Republicans to try to reach out to the middle. 

MATTHEWS:  Here‘s a stunning statistic.  Somebody hit me the other day.  You know all these statistics.  Maybe you got one.  Among young people, meaning people under 30, people out of college, still college types, it‘s unbelievable the percentage of pro-Obama sentiment there is there. 

SCHERER:  Right.  The question is, will that last?  He has set himself up.  Everyone believes in him.  But he‘s also set for himself an enormous agenda, which is going to be very difficult to carry out.  In five year, it‘s almost certain we‘re not going to talk about Obama in the same terms we‘re talking about him now.  What don‘t know what terms we will talk about him. 

MATTHEWS:  Reagan had a good run. 

SCHERER:  He did have a good run. 

MATTHEWS:  Not everybody fades.  It might well happen. 

BROWNSTEIN:  Quick point, Obama won two-thirds of voters under 30.  Only one third of the millennial generation was eligible to vote in this election.  By 2016, it‘s going to be half.  If they can‘t—if the Republicans can‘t reverse that trend, it will pay increasing dividends for Democrats, unlike most of our other investments. 

MATTHEWS:  I love your brain, my friend, Ron Brownstein, with the numbers.  Thank you, Michael Scherer for joining us.  Please come back. 

Join us again tomorrow night at 5:00 and 7:00 Eastern for more

HARDBALL.  Right now it‘s time for the big show, “1600 PENNSYLVANIA AVENUE” with David Shuster.



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