'The Ed Show' for Friday, July 10

Guests: Keith Ellison, Zack Space, Adam Schiff, Ray Young, Robert Reich, Virg Bernero, Stephanie Miller, Michael Medved, Maria Teresa Kumar


ED SCHULTZ, HOST:  I‘m Ed Schultz.  This is THE ED SHOW.


SCHULTZ:  Good evening, Americans. 

Live from 30 Rock in New York, it‘s THE ED SHOW on MSNBC.

Those damn Blue Dog Democrats are causing problems on Capitol Hill again.  I‘m in a fighting mood tonight.  They just want to make all these changes, and they‘re not for a public option.

Congressman Keith Ellison and two Blue Dog Democrats will join me tonight on this program.

Breaking news tonight.  A new report says President Bush directly ordered and pressured ailing Attorney General John Ashcroft to keep on wiretapping Americans. 

And reports tonight say that CIA Director Leon Panetta has ordered an internal investigation into whether the agency misled and flat-out lied to the Congress. 

Plus, did Sarah Palin really want to have her own reality TV show? 

Levi Johnston says it was all about the money. 

Plus, “Psycho Talk.”  

All that and a great panel coming up. 

“Daily Show” creator Lizz Winstead is with us tonight.  That‘s why I know it‘s Friday. 

But first, tonight‘s ‘OpEd.”

Well, I guess the best way to say this to you, folks, is it looks to me like we have some Blue Dog Democrats that need some Big Eddie counseling tonight.  As Richard Nixon used to say, they don‘t have their heads screwed on right. 

Now, the Blue Dog Dems are out there threatening to stand in the way of a public option on health care reform.  They are demanding significant changes before they can support any reform. 

Now, there‘s 52 of these Blue Dogs.  Forty-six of them have signed on saying that they‘ve got some real concerns about if we go into the private sector and give the private insurance companies some competition. 

What is it that they are afraid of?  Are they afraid that somebody might, when they go home, call them a liberal?  Are they afraid that somebody might say, “You‘re too liberal”? 

This is not about gay marriage.  This is not about guns.  This is not about God. 

This is about your kitchen table.  And for some reason, I don‘t know how the conservative Democrats have come to the conclusion that 72 percent of the American people just don‘t matter. 

You know what?  If they don‘t deliver on a public option and really reform what has to be reformed to help American families out, I think we need a third party in this country.  Because I don‘t know how much more counseling we have to give the Democrats.  And what is so terrible about it is that they have the American people with them. 

There‘s a disconnect there.  I don‘t know what they‘re afraid of. 

You mean to tell me that the Blue Dog Democrats are concerned about the money?  Well, they weren‘t concerned about the war funding, were they? 

I‘ll tell you what‘s wrong with the Democrats.  They‘ve got the Blue

Dog Democrats and then there‘s the real Democrats who don‘t know how to get

mad dog mean and get this thing through.  So this fight is going to go on

And there are some heroes in the Congress. 

Joining me now is Minnesota Congressman Keith Ellison.  He‘s very outspoken on this and an advocate for public option, and he has taken it upon himself, folks, to go around and videotape his colleagues and put it on YouTube so you can see exactly what they‘re saying. 

It‘s not a reporter bringing it to you, it‘s an actual elected official of the state of Minnesota.  So he is going around, he‘s using his camera, he‘s talking right there saying who he is, are then he‘s going out and he‘s interviewing colleagues saying, hey, where do you stand on public option? 

I have to say, Congressman, welcome to the show tonight.  You get absolutely an “A” for innovation.  I love it. 


SCHULTZ:  What‘s happening?  I think the American people want to know tonight, Keith, could the Blue Dog Democrats in the House screw this thing up? 

ELLISON:  Well, you know, Ed, we‘re just going to keep on talking to our friends and telling them how important it is to have a public option in order to drive down costs so that we can have a really affordable public health care system so that we can actually move forward and cover everybody.  The fact is, is that a public option actually just provides competition so that these private industry insurance companies can not inflate costs and have to get in there and compete with the public option.

This is capitalism.

SCHULTZ:  The point here is, Keith—what the people want to know, Keith, Congressman, is can the Blue Dogs create enough problems where it would derail the public option clause in the House side? 

ELLISON:  I don‘t think so.  I think our friends are going to see the light.  They‘re going to see that a public option is necessary, important, and it‘s what the people want. 

And I just want to say, I know it‘s tough out there.  You know, the industry, the special interests are spending $1.4 million a day—a day, Ed—in order to get—to stop health care reform.  But they‘re not going to succeed, because in the end we‘re all going to come together around this public option. 

SCHULTZ:  All right.  Well, it seems to me that these Blue Dogs are going to be pretty obstinate about it.  And the only way that we‘re going to turn this thing around on them is just to call for a third party. 

ELLISON:  Well, you know, let‘s give them a chance, Ed.  Let‘s keep on chatting and talking to our friends.  And it wouldn‘t help—excuse me, it wouldn‘t hurt if Americans, all 72 percent who believe in a public option, start calling into their elected officials and letting them know how they feel. 

SCHULTZ:  All right.

Congressman Keith Ellison with us tonight here on THE ED SHOW.

Thanks so much for joining us, Keith.  Have a great weekend. 

ELLISON:  You bet.

SCHULTZ:  Congressman Zack Space, now he‘s a Blue Dog from Ohio.  And he was one of the 46 that signed the letter questioning the public option. 

He joins us tonight. 

Congressman Space, explain your position on this.  Are you against a public option? 

REP. ZACK SPACE (D), OHIO:  No, I‘m not against a public option, Ed. 

SCHULTZ:  Well, then why did you sign the letter? 

SPACE:  Because I think we need to refine this.  Right now, what I‘d like to do is get the input of the hospitals that are so important not just to the provision of the medical care to the people I represent, but it‘s also an economic engine in our district.  They‘re the largest employers in the district. 

I want to find out from them how this public plan affects them.  Is it going to drive them out of business?

Look, I believe we need a public plan, but I think it needs to be actuarially sound.  It has to be designed to do exactly what leadership has said they want the public plan to do, and that is compete with the private market. 

We want to bring out what‘s best about the market forces and suppress what‘s bad about them.  That‘s the problem with the system now—it‘s not done that.  I‘m all for public option, I just want to make sure it‘s done right. 

SCHULTZ:  Well, now, I‘m under the understanding that the 46 Blue Dogs that signed on to this said that they don‘t want the public option. 

SPACE:  No, that‘s not the case at all. 

SCHULTZ:  Well, then, what is it that you‘re concerned about?  I mean, the hospitals? 

SPACE:  Yes.  Well, the public option, as it now stands, looks as though it‘s going to extend Medicare reimbursement rates to the public option.  Many of our hospitals are losing money under that formula. 

We‘d like them to be able to opt into those public plans, as opposed to being required to go in, so that the reimbursement can be negotiated.  I think that‘s sensible.  It makes sense for the hospitals, it makes sense for the public. 

SCHULTZ:  So, Congressman, you can guarantee to your constituents in Ohio that you‘re going to fight for a public option and you‘re going to give competition to the private sector? 

SPACE:  That‘s what I‘m going to do.  I‘m going to fight for a public option that is legitimate, that enhances quality, that brings down costs, increases transparency, and makes the system more affordable, and brings higher quality to the system. 

SCHULTZ:  Well, you know, that‘s all great talk.  But are you going to support a public option?  I mean...

SPACE:  Yes, I am, Ed.  I want to support a public option if it‘s done properly. 

SCHULTZ:  OK.  Then what‘s in the letter?  I mean, we‘re getting conflicting reports here, because it‘s in the letter that the conservative Democrats are—the Blue Dogs, specifically, 46 out of the 52 -- have serious reservations and want significant changes, and they question the public option.  And they can‘t stand up right now and say you‘re going to support it. 

SPACE:  Well, I‘m standing up right now and I‘m not going to speak for all my Blue Dog friends, but I can tell you, a lot of us do agree with the public option.  We just want to make sure it‘s measured properly. 

And the other thing we have concerns about are moving a little bit too fast on this issue.  We all know that health care has to be addressed.  It‘s got to be addressed this year. 

I‘d like the ability to go back to my providers, go back to my consumers and my constituents, and get their reaction.  We don‘t even know how this is going to be paid for yet. 

SCHULTZ:  Well, I would—Congressman, I would suggest you take your name off that letter, because—seriously.  And I‘m not trying to diss you.  I know the people in Ohio want this.  They‘ve got to have—they want...


SPACE:  We desperately need health care reform.  I know that, Ed.  We want to do it right.

SCHULTZ:  We‘re going to do it right.

SPACE:  This is a profound issue.  We have one shot to do it.  We want to get it right.

SCHULTZ:  We‘re going to do it right.  Just get the Republicans out of the way.  Just get the Republicans out of the way and we‘ll do it just right, because they haven‘t done us any favors at all when it comes to health care in the last eight years. 

SPACE:  I hear you, brother. 

SCHULTZ:  I‘m glad to hear what you‘re saying tonight, Congressman. 

Thanks so much for joining us. 

SPACE:  Good to be here. 

SCHULTZ:  All right.

Not all of the Blue Dogs are in my dog house.  Congressman Adam Schiff is a Blue Dog Democrat from California.  He did not sign the letter on the public option. 

Where are the conservative Democrats on this, Congressman?  We‘re getting mixed messages here tonight. 

Where do you stand? 

REP. ADAM SCHIFF (D), CALIFORNIA:  Well, I‘ve always supported a strong public option, and I continue to advocate for that.  And I‘ve written to the leadership to urge that we ensure we have a public option in the health reform. 

But here‘s where I think the Blue Dogs are adding value and really the core of the conviction that we‘re expressing to leadership, and that is this—and it‘s not on the public option, whereas you can see we‘re divided.  But rather, it‘s that we need to bring some real cost containment to the health care system. 

We are spending 16 percent of our GDP on health care, which is the most of any industrialized nation.  We‘re not getting great outcomes.  We‘ve got 45 million people uninsured.  Health premiums are going up four times faster than wages. 

Ed, that‘s unsustainable.  So we can‘t simply graft new beneficiaries onto a broken system.  We need to bring about reforms.  And as the president talked about during his campaign, reforms that move us to a value-based system, where we‘re compensating providers for how well they‘re doing in taking care of patients, not simply the volume of services that are provided. 

SCHULTZ:  So you‘re...

SCHIFF:  So, that, you know, I think is really at the core. 

SCHULTZ:  So Congressman, I‘m hearing that you believe that there‘s no threat whatsoever of the Blue Dog Democrats getting in the way of a public option?

SCHIFF:  Well, I‘m telling you, Ed, I support a public option, and there are many Blue Dogs...

SCHULTZ:  Well, I‘m glad you do.  I‘m glad you do.  You‘ve told us that.  But the issue here is that you‘ve got a conservative group of Democrats in the House right now that are making some waves and threatening not to support it. 

That is a mixed signal to the American people.  I thought the Democrats in the House were OK on this.

SCHIFF:  Well, the Democrats in the House are unified in wanting a massive health care reform, and to extend and bring about universal coverage.  How we get there, there is no consensus that involves the entire Democratic Caucus.  We are a big tent party, as you know, Ed.

Now, I can really only speak for myself and for those who share the same views.  And as far as I‘m concerned, we need a public option not only because I think it‘s a very cost-effective way to expand health care, but it puts pressure on the costs in the private system by bringing about necessary competition.  So, for me, a public option is not only valuable in its own right, but in terms of cost containment, it brings about competition for the private plans, which I think is extraordinarily important.

SCHULTZ:  All right.  Let me...

SCHIFF:  But Ed, the reason we‘re in the majority, Ed, is because we‘re a big tent party.  And that means we‘ve got very liberal Democrats and we have very conservatives ones representing some really tough areas.  That‘s why we‘re working to get to consensus.

SCHULTZ:  Congressman Schiff, respectfully, I don‘t disagree with the fact that we‘re a bigger tent than what the conservatives had over the last eight years.  But you‘re in power, in my opinion, because the Democrats went out across this country and talked about change and said that they were going to do something about health care. 

And when I see the Blue Dog Democrats—and I know how they operate.  They go home and they play the conservative side of things.  They‘re getting weak knees on this, and it would seem to me that somebody‘s got to hold their feet to the fire. 

Now, let me ask you this.  Do you think that the Democrats...

SCHIFF:  Ed, let me say this.  Let me just—Ed, let me...

SCHULTZ:  ... in the House—do you think the Democrats in the House have the votes to do this? 

SCHIFF:  We‘re going to have to have the votes to do it, Ed.  And this gets to your basic point.  And that is, you‘re right, the Democrats were put in the majority, and the president was elected because the American people want change. 

And in terms of health care, we need change.  So, basically, at the end of the day, Ed, we‘re going to be evaluated based on whether we can deliver. 

And the bottom line is, we‘re going to have to deliver.  Not only were we elected on that premise, but the country needs it.  And I think it‘s at a time like this where, you know, we have an opportunity and an obligation to do more than tinkering around the edges.  And I think we need very substantial health reform.  And we‘re going to do it. 

SCHULTZ:  Congressman Adam Schiff, good to have you on the program tonight.  We will obviously follow the story. 

SCHIFF:  Ed, great to be with you.

SCHULTZ:  You bet.

Coming up, this is the best advertising General Motors could buy—a featured car in the summer‘s hottest movie.  The new Camaro is flying off the lot, and it could be the wind that GM needs to get back into the black. 

Plus, George W. Bush.  Just how involved was he in wiretapping? 

That‘s all coming up on THE ED SHOW.

Stay with us, right here on MSNBC.


SCHULTZ:  Welcome back to THE ED SHOW.

How about General Motors?  They‘ve got a winner—the new Chevrolet Camaro, muscle car. 

Folks, this is the hottest new vehicle on dealer lots.  Buyers were putting down deposits on the Camaro before the first one was ever built back in March.  It‘s outselling the Ford Mustang. 

General Motors emerged from bankruptcy today.  CEO Fritz Henderson says the new GM will be focused on the customer.  He says they‘re going to make money on this thing.  In fact, they‘re going to repay the $50 billion government loan ahead of the deadline, which is 2015. 

I‘ve said all along, it‘s a loan, it‘s not a bailout.  And now GM is coming out saying that, A, we‘re going to be able to make the deadline, we‘ll probably beat it. 

Now, joining us to talk about the new GM is the company‘s chief financial officer, Ray Young. 

Ray, good to have you on THE ED SHOW tonight. 

Did you expect the Camaro to be this hot? 

RAY YOUNG, CFO, GENERAL MOTORS:  Well, we knew as we developed the product that this was going to be an exceptional product.  So we were very anxious to get the product launched in the marketplace in order to see what the reaction was from the customers. 

And as you saw, the reaction has been absolutely incredible for this vehicle.  We‘re absolutely delighted.  You know, we‘ve got different versions of the Camaros, and they‘re all going out the doors as fast as we can build them. 

SCHULTZ:  How much has it helped you to have a hot summer movie out there featuring this vehicle? 

YOUNG:  Well, it helps, definitely.  It gets back to what we call creative marketing. 

You don‘t simply just have to advertise your products, you have to find different venues to show your products.  And so this partnership with the “Transformers” has turned out to be very, very good for us in terms of not just this product, but other products as well. 

SCHULTZ:  Now, Mr. Young, your company is telling the American taxpayer that you think you can pay back $50 billion ahead of schedule.  You‘re going to do that all with the Camaro?  I mean, this is a pretty bold statement, isn‘t it? 

Are you that confident that GM‘s going to be able to turn it around like that? 

YOUNG:  Well, just to be clear, I mean, the loan is about $8 billion to the U.S. government and the Canadian government.  And the rest of the investment, the U.S. government has basically purchased shares of the new General Motors. 

What Fritz Henderson, our CEO, indicated was that we hope that we can repay the loan component back ahead of the six-year term of the loan.  And with respect to the common shares of new General Motors, which the U.S.  government and the Canadian government owns, we hope to get an IPO out sometime next year, in 2010, and that will allow the government to start selling down the shares whenever they deem appropriate. 

SCHULTZ:  Do you need another vehicle before that independent public offering? 

YOUNG:  Well, we have a lot of great products ready to be launched right now.  I mean, the nice thing about new General Motors is we emerged today, is that we‘ve got an additional five new products coming to the market this calendar year.  And every one of them are going to be exceptional winners. 

We‘re actually very, very excited.  The new Buick LaCrosse, the new Cadillac SRX, the new CTS SportWagon, the new Chevrolet Equinox, new generation, and then the GMC Terrain.  All these are going to be exceptional vehicles entering the markets over the next three months. 

SCHULTZ:  Mr. Young, good to have you with us tonight, and congratulations on the summer success that General Motors is having.  I‘d say that‘s real good news for the taxpayers. 

Good to have you with us. 

YOUNG:  Thank you.

SCHULTZ:  Next up on THE ED SHOW, “Psycho Talk.”  The founding fathers said Americans have the right to life, liberty and the pursuit of happiness.  They didn‘t say you have to have the right to eat.  Now, a righty talking head gives us some psycho food for thought coming up next on THE ED SHOW. 


SCHULTZ:  Oh yes.  Welcome back to THE ED SHOW.

Since we‘re going to have a great weekend, we thought we‘d give you a double dose of “Psycho Talk” tonight.  Here‘s a doubleheader for you—

Congressman Roy Blunt and Town Hall‘s Jillian Bandes.  Let‘s start with Bandes.

Ms. Banders was featured in a health care debate right here on MSN earlier this week.  She went up against Firedoglake‘s Jane Hamsher, who spoke in favor of a public option and actually used her personal experience of being a cancer survivor after going through that for 16 years to make her point. 

The exchange got a bit heated at times.  Let‘s listen to it. 


JANE HAMSHER, FIREDOGLAKE:  As a 16-year cancer survivor myself, I really find it offensive that people try and drag others into this and say that somehow, our system that we have right now represents the 50 million people who are uninsured, or that it does anything...

JILLIAN BANDES, TOWNHALL.COM:  Whoa, whoa, whoa, whoa.  I‘m sorry I‘m not a cancer survivor, but that doesn‘t mean I can‘t criticize a public plan. 

HAMSHER:  No.  Well, I suppose you are, but you don‘t know what you‘re talking about.  Basic health care access should be a basic human right in America.  We spent $2 trillion on the banks last year.  Now we‘re talking about the fact that we cannot...

BANDES:  Should food be a basic human right?


SCHULTZ:  Yes, I would argue food is a basic human right. 

The fact is that 48 countries, including the United States, who signed the Universal Declaration of Human Rights in 1948, they think so too. 

Now, moving on to Psycho Talker number two tonight, we‘ve got Congressman Roy Blunt speaking to a conservative radio station in his home state of Missouri. 

Now, listen to Blunt.  He tells us why the government should have never started Medicare and Medicaid. 


REP. ROY BLUNT ®, MISSOURI:  You could certainly argue that government should have never gotten into the health care business.  The government did get into the health care business in a big way in 1965 with Medicare and later with Medicaid.  And government already distorts the marketplace. 


SCHULTZ:  Well, let‘s see here.  We decided to take a closer look at Medicaid and just how many people in the state of Missouri are being helped in the congressman‘s home state.  Here‘s what we found for Missouri, the Foundation for Health. 

Missouri‘s Medicaid program currently provides public health insurance to approximately one out of seven folks that live in the state.  It covers 34 percent of Missouri‘s children. 

Nationally, Medicaid provides public health insurance to approximately, let‘s see, 60 million low-income Americans.  To say Medicare and Medicaid is a waste and suggest food is not a basic human right, folks, that‘s a Friday night of double “Psycho Talk.”  


SCHULTZ:  Welcome back to THE ED SHOW on MSNBC.  Breaking news about former President George Bush and wiretapping.  Joining me now with the latest is NBC‘s Kelly O‘Donnell.  Kelly, we know that the Office of Inspector General came out with another report today.  This dealing with domestic surveillance programs.  What did we find out about President Bush and his involvement and what really went down? 

KELLY O‘DONNELL, NBC NEWS CORRESPONDENT:  Good evening, Ed.  In that report you referenced, there are some really interesting details that take us into a window of a moment in the Bush administration that‘s considered one of the most surreal and unusual events. 

You may recall there was a bedside attempt to pressure then Attorney General John Ashcroft into signing paperwork to reauthorize that wiretap program.  Now, we knew that had happened.  What we didn‘t know until this report was that President Bush was very personally involved. 

We‘ve learned, based on the notes of the security detail for John Ashcroft, that President Bush was calling the hospital room, calling Mrs.  Ashcroft, insisting on talking to the attorney general, telling her that top aides from the White House were coming to the hospital room. 

And at first Mrs. Ashcroft said, I won‘t take the call, her husband was too ill.  They persisted. 

Now, why were they so anxious to do this?  The program had to be recertified.  And time was running out.  And the White House wanted the Department of Justice to agree.  But there was a lot of internal conflict, as you remember, about whether this was a legal program, how it should work, who should be involved, and how many people should know about it. 

What‘s interesting is this plays out like a movie.  The top aides race to the hospital, got to the bedside of John Ashcroft, who was so ill, he said, I‘m not the attorney general; I‘ve turned over my power to my deputy.  That deputy would not sign paperwork. 

So the new fact here is that President Bush was on the phone trying to pressure Mrs. Ashcroft and the attorney general to allow those top aides to get into the room, and to try to convince John Ashcroft that he needed to sign that paperwork.  He didn‘t. 

SCHULTZ:  Now, Kelly, I understand that at a press conference or in a moment when you were in front of President Bush, you specifically asked him about this exchange.  What was the response?  This happened I believe back on May 17th, 2007. 

O‘DONNELL:  And that‘s why it really caught my attention in the report, Ed, because I did ask the president about this.  At that time, we knew that there had been some incident at the hospital.  And it involved the top people for the president, his White House counsel, his chief of staff. 

So I stood up in the Rose Garden, and I said, Mr. President, did you authorize them to go to the hospital room?  Do you think this is appropriate conduct for your top officials?  And he side stepped that question.  His response was that he believed this was a lawful and necessary program to protect the American people. 

I followed up again and I said, did you order it, sir?  And he said, Kelly, I don‘t want to move this further.  I know there‘s been a lot of speculation, but it‘s an important and necessary program.

So he wouldn‘t answer the question then.  And we learned from the notes of agents who were protecting John Ashcroft that he was involved. 

SCHULTZ:  And also, Kelly, was this in the 11th hour of this program?  Because I think there‘s going to be a lot of Americans that are going to view this as President Bush was catching then attorney John Ashcroft at a very vulnerable moment to get this recertification. 

O‘DONNELL:  He was incredibly vulnerable.  He had just had surgery.  He was on medication.  He was not feeling well.  He was very weak.  And the clock was ticking.  The deadline was right upon them.  And what turned out is the deadlines passed and the president recertified the program on his own, without the Department of Justice later. 

Then, even later still, we now know that Congress has changed some of the rules, so this kind of surveillance can go on.  But they had to create new law to make it work. 

But, at that time, the White House was very intent on saying this program was useful, necessary to try to listen in on phone calls or look at e-mail of people who might have ties to al Qaeda or other terrorist groups inside the United States. 

SCHULTZ:  Kelly, thanks for your time tonight, I appreciate it so much. 

O‘DONNELL:  Good to see you, Ed. 

SCHULTZ:  NBC‘s Kelly O‘Donnell here with us on THE ED SHOW tonight. 

Back to the current White House.  The Obama administration to me seems to be pretty nervous.  President Obama is going to the graveyard of the economy next week, the state of Michigan.  I think the fact that Obama sent Joe Biden to the Heartland speaks volumes right now.  The hourglass in the eyes of many people has really turned on this stimulus package. 

This is the Obama economy.  And here‘s a number that‘s positive.  Jobless claims dropped dramatically last week to the lowest level since January.  But there‘s still a long way to go. 

Joining me now is former Labor Secretary Robert Reich, a professor of public policy at UC Berkeley in California, also author of “Super Capitalism,” available now in paperback. 

Mr. Reich, what‘s going wrong?  Why is it so slow, in your opinion? 

What‘s happening? 

ROBERT REICH, FORMER LABOR SECRETARY:  Ed, I wish I could say you the economy is turning around and everything is coming up on roses and green shoots are sprouting.  Actually, it is not going that way.  The asset bubble that blew up, the housing bubble, was such a huge shock to the system that employers are still laying off people.  We have 9.5 percent of our entire workforce is laid off. 

But that doesn‘t even include all of the people who are too discouraged to look for work, and all of the people who are working part-time that would rather be working full-time.  This is a huge problem.  One out of seven Americans are either unemployed or underemployed.  And as long as that‘s the case, they don‘t have the money to go around and buy things, which means that employers are going to be laying off even more people. 

SCHULTZ:  As former labor secretary, what would be your advice to the Obama administration?  What should they be doing? 

REICH:  Well, the Obama administration would have a difficult time selling Congress on a second stimulus package, particularly given how long it has taken to get the first stimulus package out the door.  I would say that the only possible thing that the Obama administration can do that Republicans and conservative Democrats might possibly sign on to is a tax cut for middle class, low and middle class people, maybe exempting the first 15,000 dollars of income from payroll taxes. 

That would put money into people‘s pockets right away.  It‘s something Republicans could possibly like.  And maybe it would get the economy going. 

SCHULTZ:  They‘ve always liked tax cuts, that‘s for sure.  There‘s a very ominous story that came out earlier this week that a lot of these states that are in financial trouble, they‘re sitting on the money.  And the stimulus money is not going to job creation, into new projects.  What do you think the Obama administration or the secretary of labor could do about that? 

REICH:  Well, there are several things here, Ed.  Number one, the Obama administration needs to—is already doing, but needs to do even more, actually get on top of the funds that are going out the door, making sure that the states are spending it down.  Number two, the states right now have a huge fiscal problem, because the states cannot run deficits, Which means that the states, because there is not much tax money coming into the states, given that people don‘t have jobs or don‘t have much income—the states are cutting employment in terms of state services.  And at the same time, they are raising taxes.  These are two things you don‘t want to do in a deep recession. 

SCHULTZ:  You‘ve got Republican governors out there that are sitting on the money. 

REICH:  Republican governors—

SCHULTZ:  They don‘t want Obama to succeed.  Heck, they want him to fail.  So they‘re taking this federal money and using it to run their state budget.  That‘s not stimulus. 

REICH:  Ed, what the Obama administration needs to do is make it very clear to the people in those states what those governors are doing.  Most people don‘t want the governors to sit on the money.  Most people want unemployment insurance.  They want help.  They need help with regard to their mortgages. 

The last thing they want is to support a governor or re-elect a governor who is sitting on that money. 

SCHULTZ:  Former Labor Secretary Robert Reich, great to have you with us tonight.  Thanks so much. 

REICH:  Good to see you, Ed. 

SCHULTZ:  All right, I want to turn now to a gentleman who I‘ve got great respect for as a mayor.  I call him America‘s mayor, Virg Bernero from Lansing, Michigan.  Verge, I‘m curious.  Have you gotten any stimulus money to help things out in Lansing, Michigan? 

VIRG BERNERO, MAYOR OF LANSING, MICHIGAN:  We have, Ed.  We‘ve gotten a few million dollars for roads and sewers and housing.  And it‘s very helpful.  Of course, we could use more.  But we‘re grateful for what we‘ve gotten.  It is putting some people back to work.  And it‘s addressing some vital needs in our community.

But you know, you and I know and the American people know what we need, and that is jobs.  And I didn‘t hear, with all due respect, Secretary Reich talking much about this.  We need the jobs back, the ones that were shipped overseas.  We need them back here in America. 


BERNERO:  That‘s what we need in places like Lansing, Michigan. 

SCHULTZ:  Virg, is the stimulus money that has gone to your town, is it creating jobs or is it just slowing the pace down of a loss? 

BERNERO:  Well, I—you know, I have to, of course, be honest with you, Ed, and the American people.  I mean, I think—there‘s no question it‘s helping.  But people—look, I go door to door.  Right now, I mean, I talk to folks.  They‘re asking for jobs.  I mean, they‘re calling.  They need jobs. 

So it‘s just the enormity of the need.  This is ground zero in places like Lansing, Michigan, and the state of Michigan.  We‘ve lost so much manufacturing that the stimulus—it is helpful, and of course extending unemployment and the trade readjustment, it‘s all helpful.  We want to keep food on the table, and keep people in their homes.  That‘s all crucial. 

But for the long term, to turn around the economy, I don‘t think people are going to start spending again until they have that job, until they know for the next couple of years they‘re taken care of. 

SCHULTZ:  Virg, you‘ve got the president going to Michigan next week. 

What do you want to hear him say? 

BERNERO:  Two things I‘m looking for the president to talk about:

trade, fair trade, and a commitment to manufacturing.  That‘s what we need.  You know, I don‘t want to hear any more about this post-manufacturing, that we‘ve got to get out of it, like Wall Street wants to tell us that manufacturing is passe. 

We‘ve got to have advanced manufacturing in this country.  No modern economy exists without it.  I‘d like to hear the president acknowledge that and commit to manufacturing in places like Michigan.  We have to have it in the Heartland of this country.  We need it for the security of this country. 

The bottom line, no matter what we‘re making, we‘ve got to have fair trade.  Whether we‘re making wind turbines or solar panels, all that stuff can be made overseas.  We‘ve got to have a level playing field for our workers. 

SCHULTZ:  Thank you Lansing Mayor Virg Bernero.  Great to have you with us. 

Let‘s turn to our panel tonight.  Maria Teresa Kumar is the founding executive director of Voto Latino.  Stephanie Miller is a syndicated radio talk show host.  She‘s with us tonight.  Michael Medved, nationally syndicated radio talk show host, with us as well. 

Maria, what has to happen?  Is this a critical time for the Obama administration?  You‘ve got Michigan.  You‘ve got Indiana.  You‘ve got Ohio.  Unemployment is going up.  What does he have to do? 

MARIA TERESA KUMAR, VOTO LATINO:  You just named his campaign trail for 2012, right?  I think that‘s what the American people are looking.  Everybody‘s hurting.  I think what the secretary said earlier was that one in seven Americans—these are folks that we know.  Right, Ed?  What he needs to do is have a conversation with the American people, but also realize that this was eight years in the making.  This was—Obama inherited this problem.  And he needs to continue having this conversation. 

We‘re only five months into the stimulus package.  So we still—it‘s still very much a wait and see. 

SCHULTZ:  Michael Medved, is the president‘s stimulus package in the critical zone yet? 

MICHAEL MEDVED, RADIO TALK SHOW HOST:  I think it‘s beyond the critical zone.  Part of the problem was the president‘s advisers made very specific predictions about the rate of unemployment.  And they said that if the stimulus was passed, it would never go over eight percent.  As you know now, it‘s 9.5 percent.  That‘s worse than they said it would be if there were no stimulus. 

They need to spend the money more quickly.  They need to target it more effectively.  Now that the stimulus is part of the law, it‘s crazy that they‘ve only spent 56 billion dollars of it so far.  It has to be more effectively managed. 

That calls for governance, for concentrating, and maybe forgetting some of the other sweeping changes, and getting this one done right. 

SCHULTZ:  Stephanie Miller, the state that you live in, California, right now is flat-out broke.  Are you seeing any money coming out there?  Is there any job creation taking place at all in California? 

STEPHANIE MILLER, RADIO TALK SHOW HOST:  No, and now we‘ve got to pay for this Michael Jackson service, Ed.  We are really in a world of hurt out here. 

You know, for the first time ever, I agree with Michael Medved.  We—which is startling.  But, you know, we haven‘t spent a lot of this.  The vice president was saying we‘ve only spent 10 percent of this.  How can you say it‘s not working yet?  Joe Biden was saying, this is supposed to be over 18 months.  We‘re 180 days into this.  I think it‘s a little quick to pronounce it a failure. 

SCHULTZ:  It‘s not a failure, but there is an issue with the money not getting out there fast enough.  There is an issue of the money that is out there is not going directly to new jobs. 

Panel, stay with us.  We‘re going to come back and talk about a lot more tonight. 

Coming up, the plot thickens in the John Ensign sex scandal.  Stephanie will have something to say about that.  He admitted to an eight-month affair with a married campaign staffer.  Those staffers will get you in trouble every time, especially if you‘re a Republican.  Now her husband claims Senator Ensign used her job as leverage to keep up the affair.  We‘ll get into all that in my playbook, next, when we come back.  Stay with us.


SCHULTZ:  In my playbook tonight, the latest twist in Senator Ensign‘s sex scandal.  And that‘s exactly what it is, a scandal.  We now have part two of John Ralston‘s interview with Doug Hampton, the husband of Ensign‘s mistress.  Remember, Doug Hampton was Ensign‘s chief of staff, and his best friend.  He says Ensign asked him to quit over the affair.  Doug Hampton says he complied.  But not before Ensign orchestrated a consulting contract for him with November, Inc. 


DOUG HAMPTON, WIFE HAD AFFAIR WITH SENATOR ENSIGN:  He orchestrated the creation of November, Inc and me getting back to the state and getting out of his official office.  He told me basically at the same time he said, I‘m in love with your wife, you can‘t work for me anymore. 

We were employees.  Not fired, but orchestrated, asked to leave, ushered out.  However you have it, a powerful man changed our employment life forever. 


SCHULTZ:  For much more on the story, let‘s turn to “Politico‘s” Glenn Thrush.  Glenn, I think Americans are wondering, why is this guy giving these interviews?  He must be one upset dude about what happened to his personal life. 

GLENN THRUSH, “POLITICO”:  Well, I don‘t think this is the way you really expect things to go when you get married and work for a United States senator.  Look, I mean, this is Baronial power that is exercised, according to Doug Hampton, by John Ensign.  The guy controlled so many different aspects of this guy‘s personal and professional life.  He exalted him to this position of chief of staff, gave his wife this job as campaign treasurer, doubled her salary right before the affair ended, gave him an exit strategy.  And then I think in the most damaging disclosure thus far, he claims, Hampton claims that Ensign used the wife‘s job as leverage to continue the affair.  It‘s pretty damaging stuff. 

SCHULTZ:  We should point out that both Senator Coburn and Senator Ensign were roommates at the time.  And so obviously he knew what was going on.  But what is Rick Santorum‘s involvement in this story breaking out to the public? 

THRUSH:  Well, this just keeps getting weirder and weirder.  Rick Santorum, the former senator from Pennsylvania, apparently was told by Doug Hampton, who knew him from the Senate, about this letter that Hampton sent to Fox News.  And I guess Hampton implied—he didn‘t say it outright—that Santorum ratted him out to John Ensign and sort of blew the whole deal for him. 

SCHULTZ:  Great to have you with us tonight.  Appreciate your time, Glenn.  Thank you. 

THRUSH:  Thank you. 

SCHULTZ:  More Republican family values in action.  Levi Johnston is talking smack about Sarah Palin.  He says she‘s quitting the governor‘s gig so she can go off and get rich.  Who do you think‘s going to comment on that?  Our friend and comedian Liz Winstead takes it up next right here on THE ED SHOW on a Friday night.


SCHULTZ:  Welcome back to THE ED SHOW.  It‘s time to now for Club Ed and a look back at this week‘s highs and lows.  Comedian Liz Winstead, co co-creator of “The Daily Show” and the brains behind “Wake Up, World.”  How about this Ensign dude?  He was rocking. 

LIZ WINSTEAD, “WAKE UP WORLD”:  I don‘t understand how a 51-year-old senator has the cojones to ask his parents to tap into their retirement fund to pay off his mistress.  Really?  Really? 

Here‘s the thing.  I guess what we learned about Ensign—a couple of things.  But one thing I learned is that the only job left in America that has a good severance package is Republican mistress.  That‘s it.  Last job left in America. 

SCHULTZ:  What an allowance. 

WINSTEAD:  It‘s great. 

SCHULTZ:  How about Levi Johnston.  We‘ve got some family secrets coming out of the Palin camp. 

WINSTEAD:  Yes, you know, that brain trust, just leaking all over the place.  You know, when you have desperate half talents, they turn on each other.  What someone doesn‘t realize is that there is now enough footage to actually do a reality show with news footage. 

SCHULTZ:  Seriously, you co-created “The Daily Show.”  Is there enough material there? 

WINSTEAD:  There is enough material.  You know, it‘s so funny, because somebody sent me Sarah Palin—the text of Sarah Palin‘s speech, which we all watched in sheer disbelief, like what is she talking about?  Refrigerator?  She was like my mother, who is 87, who just blabs on and on and on, and never knows when she‘s done talking so she just keeps talking.  Refrigerator magnets, basketball, yada yada.  I‘m not quitting, because I‘m not a quitter as I‘m quitting.  The whole crazy train.

But when you read it, it really feels like—if you‘ve ever read like the Manson papers of Kaczynski‘s thing.  It feels a little bit like she probably lives in a tiny, tiny hut and just writes things down in tiny font.

SCHULTZ:  They have innovative promoters in Alaska.  This Johnston kid, he‘s got a future I think.

WINSTEAD:  He‘s going to end up a porn star, don‘t you think.

SCHULTZ:  You think so?

WINSTEAD:  Are you kidding me?  Come on, Ed.

SCHULTZ:  Levi late at night, or whatever.  What do you make of Leon Panetta now saying that the Congress was lied to?  They didn‘t tell the full story at the CIA, and now we‘re going to have an investigation. 

WINSTEAD:  Is there a bigger non-story than the CIA isn‘t honest with Congress?  Like seriously, since 2001 -- how about since the ‘50s?  Then the ‘60s.  Then there was the ‘80s.  Oh wait, then there was 2000.

I don‘t understand why people are actually shocked. 

SCHULTZ:  When are they going to admit they‘re in the business of lying? 

WINSTEAD:  Exactly, hello.  The word covert usually comes up when you‘re talking about these people. 

SCHULTZ:  Liz Winstead, great to see you.  Thanks for stopping into Club Ed.

Let‘s get back to our panel, Maria Teresa Kumar with us tonight, also Stephanie Miller and Michael Medved. 

All right, Stephanie, I got to ask you, what do you make of this Republican love affair they got cooking over there in Senator Ensign‘s office? 

MILLER:  I don‘t know, Ed.  Doesn‘t it make you wish for, you know, the olden days, the old-fashioned Republican family values of Larry Craig and Governor Sanford, I guess.  The good old days. 

SCHULTZ:  Michael, where does this go?  Does the image of the Republican party—I mean, you‘ve got to tell voters now that there is a serious side to all of this.  You‘ve got to clean up your act.  I‘m not talking about you, obviously.  I‘m talking about the party‘s got a damaged image over all of this. 

MEDVED:  It does.  And of course, this has happened in both parties and there are scandals in both parties.  But there‘s no problem.  Republicans have—no doubt that Republicans have a special problem with this.  The one point I wanted to make is I don‘t understand, Ed, why serious people are listening to or paying attention to Levi Johnston.  Right? 

Can you think of any other politician, other than Sarah Palin, whose children have been so remorselessly and relentlessly attacked?  Honestly, it didn‘t happen with President Bush that way.  Certainly didn‘t happen with President Clinton and with Chelsea.  The kind of attacks and focus on Sarah Palin‘s children, how do you justify it?  I don‘t get it. 

SCHULTZ:  I think you justify it by Sarah Palin letting her kids go on the front cover of “People Magazine.”  They‘ve kind of been out there, Michael.  They‘ve kind of been promotionally advancing themselves from one month to another. 

MEDVED:  Al Gore did that with his son Christopher, remember, who was seriously injured—

SCHULTZ:  I don‘t think you conservative talkers were too nice to the Clinton administration—

MEDVED:  Christopher Gore has had several drunk driving arrests.  He has not been a focus the way that Sarah Palin‘s children have.  And frankly, it—

MILLER:  By the way, Ed. 

MEDVED:  Go ahead, Stephanie. 

MILLER:  Michael, how is she going to get a reality show?  It already is a reality show.  Isn‘t it help, I‘m a Celebrity Governor, get me out of here?  We‘ve already had the reality show. 

SCHULTZ:  Maria, what do you make of all of this? 

KUMAR:  I think the problem with the Republican party is that they keep running on values, and they keep demonstrating to the American people what not to do in your family structure.  That‘s the problem.  They have to stop having affairs.  They have to stop having mistresses.  They‘ve got to stop parading, as you mentioned, their kids on “People Magazine.” 

SCHULTZ:  And stop having their parents try to everything cover up with the hush money or extortion.  We still don‘t know the whole story on this one.  What a strange turn of events.  Stephanie, what do you make of the parties jumping in and paying the bill? 

MILLER:  Wow, Ed, who knew that you get lovely parting gift for adultery now.  Sorry, I ruined your marriage; here‘s a toaster oven and some cash. 

MEDVED:  I think Senator Ensign is a serious problem right now.  First of all, Congress is about to lose its only licensed veterinarian if Senator Ensign does go. 

But the truth is, he really was never a serious presidential possibility.  And I think that, frankly, the fact that, oh, now he‘s blown up as a presidential possibility, only happened after his tremendous embarrassment. 

SCHULTZ:  Michael, Maria, Stephanie, great to have you with us tonight.  That‘s all the time we‘ve got right now.  That‘s THE ED SHOW.  We‘ll see you back here Monday night.  Have a great weekend.  “HARDBALL” is next on MSNBC.