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'Hardball with Chris Matthews' for Friday, July 30th, 2010

Read the transcript to the Friday show

Guests: Anthony Weiner, Douglas Holtz-Eakin, Heather Boushey, Dan Balz,
Jeff Zeleny, Claire McCaskill, Chris Cillizza, Liz Sidoti
CHUCK TODD, GUEST HOST: (In progress)  ... gone mad?
Let‘s play HARDBALL.
Good evening.  I‘m Chuck Todd, sitting in for Chris Matthews.  Leading off tonight: Fireworks in the House.  If you had any doubts that we are not in an era of good feeling and civility in Washington, check out this explosion from Democratic congressman Anthony Weiner.
REP. ANTHONY WEINER (D), NEW YORK:  The gentleman is providing cover for his colleagues, rather than doing the right thing!  It‘s Republicans wrapping their arms around Republicans, rather than doing the right thing on behalf of the heroes!  It is a shame!  A shame!
TODD:  He was enraged at Republicans for what—he says they were blocking a House bill to provide health care to 9/11 responders who got sick after working at Ground Zero.  The criticism was aimed at Republicans who, he said, were blocking the bill.  But did the Democrats simply attempt to set up the minority party by playing procedural games, or did Democrats fear Republicans would create a poison pill bill?  We‘re going to talk to the man behind the rage, Congressman Weiner.
Also, as the GM bail-out goes, so goes the Obama presidency?  That‘s been my view for some time, and today President Obama paid what could only be described as a chest-thumping visit to Chrysler and GM plants to cheer what the president believes is evidence of the recent turnaround in the auto industry.  A lot of people didn‘t like the auto bail-outs at the time, and some still don‘t, mostly because of the Wall Street bail-outs.  The term “bail-out” is a four-letter word to many Americans.  We‘re going to dig into the president‘s contention that this bail-out for Detroit was necessary and worth it.
Plus, are Democrats beginning to close the gap on Republicans?  A lot of recent polling, national and district by district, has shown a small but noticeable improvement for the Democrats.  And some of the party‘s Senate candidates are in better shape than they‘ve been in for a while.  Still, losing by two touchdowns or by three points is still a loss.  On this last weekday in July, we‘re going to look ahead to the mid-terms.
Also, will the GOP be able to turn the 13 ethics charges against Charlie Rangel into 13 ethics charges against the Democratic Party?  They‘re going to try.
Finally, we‘ve got the late night comics‘ view of the president‘s appearance yesterday on “The View.”  That‘s all in the “Sideshow.”
But we‘re going to start with New York Democratic congressman Anthony Weiner.  Congressman, thank you for joining us.  So let‘s take a look at what happened.  The point of the debate was a $7.4 billion bill that would extend and improve health care benefits for 9/11 first responders.  Democrats, however, employed a procedural move that blocked Republicans from offering amendments.  That move meant the bill required a two thirds vote for approval, 290 votes in this case, rather than a simple majority.  The bill was defeated 255 to 159.  Just 12 Republicans voted for the measure.
Congressman, here‘s, of course, what you said on the House floor during the debate yesterday.
WEINER:  We see it in the United States Senate every single day where members say, We want amendments, we want debate, we want amendments, but we‘re still a no!  And then we stand up and say, Oh, if only we had a different process, we‘d vote yes!  You vote yes if you believe yes!  You vote in favor of something if you believe it‘s the right thing!  If you believe it‘s the wrong thing, you vote no.  We are following up...
WEINER:  I will not yield to the gentleman!  And the gentleman will observe regular order!  The gentleman will observe regular order!
UNIDENTIFIED MALE:  You‘re not in order!
UNIDENTIFIED MALE:  That‘s correct.
WEINER:  The gentleman think if he gets up and yells (INAUDIBLE) he‘s going to intimidate people into believing he‘s right!  He is wrong!  The gentleman is wrong!
The gentleman is providing cover for his colleagues, rather than doing the right thing!  It‘s Republicans wrapping their arms around Republicans.  rather than doing the right thing on behalf of the heroes!  It is a shame!  A shame!  If you believe this is a bad idea, to provide health care, then vote no!  But don‘t give me the cowardly view that, Oh, if it was a different procedure!
WEINER:  The gentleman will observe regular order and sit down!
WEINER:  I will not!
WEINER:  The gentleman will sit!  The gentleman is correct in sitting! 
I will not!
UNIDENTIFIED MALE:  Gentleman will suspend.  Gentleman will suspend.
WEINER:  I will not stand here...
UNIDENTIFIED MALE:  Gentleman is recognized.
WEINER:  ... and listen to my colleagues say, Oh, if only I had different procedure that allows us to stall, stall, stall and then vote no!  Instead of standing up and defending your colleagues in voting no on this humane (ph) bill, you should urge them to vote yes, something the gentleman has not done!
TODD:  Congressman, I‘m going to ask—first I want to start with the anger, or the—some may say theatrics.  Do you regret maybe pounding so much?  It‘s one thing to be upset about what happened on the floor.  Do you regret your tone or anything you said yesterday, or the yelling back and forth that took place?
WEINER:  Well, let me say this, Chuck.  In fairness, that clip should
have been put in a little bit of context.  I had spoken, as so many of my
colleagues had on the Democratic side of the aisle, and we didn‘t make any
reference to the Republicans.  We didn‘t make any reference to the politics
of this.  We talked about what should be focused on, which is the 9/11 responders who nine years after the fact are sick and dying.  Over 900 of them have died from 9/11-related illnesses.
But right before I got up to speak, my colleague, Mr. King, stood up, who‘s a sponsor of the bill...
TODD:  Right.
WEINER:  ... and spent his—almost his entire statement ripping the Democrats, using words like “cowardly” and “lacking courage” and making this about a process.  And frankly, that‘s what set me off and that‘s why I thought we needed to respond because, frankly, the Republicans have now—as you know, over the course of the last couple of years, this has been their strategy.  They say, Oh, we like the bill, but we don‘t like the way you‘re doing it.  We don‘t like the style.
TODD:  Right.
WEINER:  We don‘t like the time, how many pages you‘re using.  So that‘s what I was responding to.
TODD:  But I want—I want to talk about this process because this is
what frustrates, I think, a lot of folks in middle America, independents
who are maybe angry at everybody right now, why Congress has an 11 percent
approval rating.  They‘ll sit there and say, OK—on one hand, when they
find out you guys were going for this two-thirds majority—you could have
allowed them to introduce an amendment which would have possibly tied it up
and you guys were fearing the, quote, “poison pill” vote, that they would
have tied it to maybe spending money out of another pock (ph) budget hole -
I guess my point is the fear was, on one hand, you guys were worried they were going to pull a procedural trick, and they are upset because you pulled a procedural trick.  And you see why everybody in the middle gets so upset at Congress these days.

WEINER:  Yes, but frankly, you‘re overthinking it and they‘re spinning it.  The fact is, we needed 21 additional Republicans.  We only got 12 --
21 additional Republicans, and this bill passes.  The suspension calendar is made for non-controversial things, and this was about as non-controversial as you‘re going to get, in that we had 94 percent of a very diverse Democratic caucus vote for this.
The only reasons the Republicans voted against it—and listen, there some there that were saying things like, Oh, we don‘t—you know, people die all the time.  We can‘t provide care for everyone.  There‘s some people who were complaining about the pay (ph) for.  But what happened was Peter King and others made this about politics.  And once they did, Republicans retreated to their corner and wouldn‘t vote for this thing.
So you‘re overthinking it about the process.  We had more than enough support, if we only had 21 additional Republicans.  We only had 12 Republicans vote for health care for 9/11 responders.  That‘s mind-bogglingly hard to believe.
TODD:  Are you at all frustrated with your own Democratic leadership, who might have been able to find some sort of—even if it‘s not a middle ground—a two thirds ground that would have found those other 21 and maybe—or you decided not to use the two thirds move here?
WEINER:  No, the problem is this is the Republican tactic.  We see it in the Senate all the time.  We just had a small business bill in the Senate, where every time the Republicans said, We want this change to the bill, Senator Reid gave it to Senator McConnell.  The entire list was done.  They said, We‘re still against it.
For nine years, we‘ve watched this tactic, first when they‘re in the majority, and now when they‘re in the minority.  My constituents maybe say something different than your viewers do.  They say, You know what?  If you bring the thing to a vote—I argued this about the public option, for example...
TODD:  Right.
WEINER:  ... where too often, people get tied in knots about procedural things, when what the American people want is for us to stand up.  And unfortunately, when that time came, the Republicans almost to a person voted against 9/11 health, and that‘s what angered me so much.
TODD:  And let‘s talk about the pay-for aspect because that is—as you brought up, there were some Republicans that were upset about how this was getting paid for.  Is there any way there could have been some wiggle room on this, finding another pot of money to do this or tying it somewhere else or maybe making it so that you re—you extended the compensation fund, say, to 2020, and then took a look at this again?
WEINER:  Well, if I thought that it got us additional votes or less grandstanding or less maneuvering to try to defeat this thing, we‘re open to anything.  Look, we‘re going to come back.  I‘m not going to give up on this.  This is nine years later.  We‘ve got to provide health care for these people.  This is not about me or Peter King or Democrat or Republican.
TODD:  Right.
WEINER:  There are literally neighbors that I have.  I have a worker, my—an employee named Ed, who every day is coughing his lungs out because he was a 9/11 police officer.
TODD:  Right.
WEINER:  So we‘re going to try to fix this.  The problem is here, Chuck, is that every time we, as Democrats—we have so much fidelity to trying to go through this process, every time we sit down, we get burned.  We saw it on the stimulus bill.  We saw it on health care.  We see it in the Senate just about every single day.  And last night, we saw it on the House...
TODD:  You‘ve been...
WEINER:  ... on the House floor on 9/11 health.
TODD:  You‘ve been very critical, I think, sometimes, of the Obama White House on this.  Do you feel like sometimes they lack a party backbone, an ideological backbone on some of these fights?
WEINER:  I don‘t know.  Listen, I‘m fighting enough with Republicans enough today.  I don‘t think I want to quarrel with...
TODD:  Pick a fight with the White House...
WEINER:  ... the president.
TODD:  No, I‘m not trying to bait you.
WEINER:  But no...
TODD:  But I mean...
WEINER:  But here‘s what I do think.
TODD:  Yes.
WEINER:  Here‘s what I do.  I think sometimes, as Democrats, we come into knife fights carrying library books, and that sometimes what you‘ve got to do is try to get the votes to pass the thing, make people stand up.  We saw yesterday in an entire congressional delegation on the Republican side, only 12 members who stood up for this concept.  and I worked my tail off with my Democratic colleagues.  Just about all of us -- - we only lost four Democrats in a very diverse caucus.
I think that sometimes we‘ve got to realize the Republicans are not going to deal with us.  Now, I‘m still going to work every single day.  Peter King and I are having a rough patch in our relationship.
TODD:  Right.
WEINER:  I will admit that.  However, we have to try to get this done and we‘re going to try every means we can.  But the Republicans—they‘re the party of no, and this time, they seem to have hit a new low.
TODD:  All right, library books to a knife fight.  That is a new one. 
That‘ll be one that people will quote a lot.
WEINER:  Well...
TODD:  Congressman Weiner...
WEINER:  ... don‘t—don‘t steal it on me, Chuck!
TODD:  No, it‘s all yours!  Congressman Anthony Weiner, thanks for joining us on HARDBALL.
WEINER:  Thank you.
TODD:  All right.  Up next, President Obama visits a GM and a Chrysler plant to talk up the turnaround of the American auto industry.  The auto bail-out had plenty of critics at the time and it still does.  But did it do what it was supposed to do?  Did it save the auto industry in this country?  That‘s our debate next.
You‘re watching HARDBALL, only on MSNBC.
TODD:  Former Republican-turned-independent Charlie Crist still hanging tough down in Florida.  A new Quinnipiac poll out today shows the governor, who was, in his mind, chased out of the Republican Party, now running as an independent, still leading the field in the Senate race.  Crist has 39 percent, Republican Marco Rubio at 33 and Democrat Kendrick Meek is way back, sitting at 13 percent.  The numbers are pretty much the same if billionaire Jeff Greene somehow became the Democratic nominee, though Greene looks actually a little bit stronger -- 37, 32, 17.  Charlie Crist gaining strength, though, as we get closer to November.  We‘ll see.  Can he keep holding those 20 percent of Republicans that he still has?
We‘ll be right back.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  And let me tell you, when I look out at this plant and I look out at all of you, it gives me hope.  It confirms my conviction, don‘t bet against the American worker!  Don‘t bet against the American people!
TODD:  Well, that was President Obama at a General Motors plant in Michigan today, hailing the recent recovery of the auto industry and pushing the idea that this bail-out of GM and Chrysler was necessary and successful.  But critics still take issue with his decision to pour $60 billion into the car companies and question when the American taxpayers will get back their money.  So can the president turn auto bail-outs into a positive economic story?
Douglas Holtz-Eakin is the former director of the Congressional Budget Office and a former senior economic adviser for Senator John McCain.  And Heather Boushey is a senior economist with the Center for American Progress.  And they both join us now.
Douglas, let me start with you.  The bail-out—did it work, the auto bail-out?
TODD:  Why?
HOLTZ-EAKIN:  I don‘t think so.  The basic claims kept shifting, but in the end, the claim was that we had to pour money into these companies, or God forbid, they‘d have to go through bankruptcy and shed lines and lose jobs.  And well, they went through bankruptcy anyway.  They shed lines and lost jobs.  Now the American people own one company.  The second‘s been handed to an auto union.  And if you look at Ford, which stayed out of this entirely, it‘s the most profitable.  It‘s the American car company with the bright future.
So it‘s very hard, when the American people look out and say the government‘s doing too much, to imagine this was either a success on its merits or a good thing politically.
TODD:  Heather, I want to read to you—this is what Mitt Romney—and this is—we—we may see this debate about the auto industry come in the 2012 presidential campaign.  Here‘s what Mitt Romney wrote back in November 2008, arguing against any bail-out for Detroit.
He writes—he wrote, “If General Motors, Ford and Chrysler get the bail-out that their chief executives ask for, you can kiss the American automotive industry good-bye.  Without that bail-out, Detroit will need to drastically restructure itself.  With it, the auto makers will stay the course, the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses.  Detroit needs a turnaround, not a check.”
Was he, in your mind, proven wrong in this case, or did he have some points here in that not—the auto industry hasn‘t completely restructured itself enough?
HEATHER BOUSHEY, ECONOMIST, CTR. FOR AMERICAN PROGRESS:  Well, I think that—you know, it‘s been about a year, and we‘ve seen a lot of change.  And one of the things we‘ve seen is we‘ve actually seen jobs come back in the auto industry.  So on that point, he was clearly wrong.  That industry was hemorrhaging jobs, and now they‘re starting to see jobs coming back.  They gained over 55,000 over the past year.  That‘s certainly a good thing.
We know that if we hadn‘t taken these steps, we would have seen, you know, many more folks lose their jobs than did.  And estimates are that about—around a million folks would have lost their jobs.  So that‘s one key indicator of success.
Another indicator is that all of the big three auto makers now are profitable for the first time since 2004.  So certainly, you‘re seeing indications that those steps have had good economic outcomes.  You‘ve also seen some change.  You‘ve seen investments in new green technologies.  You‘ve seen investments along the supply chain, a lot of which has been spurred by the investments that the government has made in this sector.  So those all seem to be good reasons, good outcomes so far.
TODD:  Hey, Doug, I want to play this—we have one more bite from the president today at the Chrysler plant today about those that he says opposed the bail-out of the auto industry.  Let‘s listen.
OBAMA:  This plant and your jobs might not exist.  There were leaders of the “just say no” crowd in Washington, they were saying, oh, standing by the auto industry would guarantee failure.  One of them called it the worst investment you could possibly make.
OBAMA:  They said—they said we should just walk away and let those jobs go.
OBAMA:  I wish they were standing here today.
OBAMA:  I don‘t think they‘d be willing to look you in the eye and say that you were a bad investment.  You know, they don‘t like admitting when I do the right thing.
OBAMA:  But they might have had to admit it!  And I want all of you to know I will bet on the American worker any day of the week!
TODD:  Now, Doug, clearly, the president making a political argument.  But I want to read you another quote here.  There was a pool—or you know, the traveling pool press with the president.  One of them interviewed a GM plant worker, a guy named Robert Allen (ph), 62, an electrician, 25 years at GM.  He said, I voted for John McCain.  I didn‘t like the bail-outs at all, didn‘t like the health care bail-outs.  But he liked the auto bail-out.  He said it kept a lot of plants open.  And he goes, Sometimes, the government needs to help out.  But he also said he can‘t wait for the government to be out of the auto industry.
Where—I guess I ask you this as an economist.  When is it—you know, was—was this sort of the right idea of how a government bail-out would work in this sense, as opposed to, say, the Wall Street bail-outs, which have become so toxic—politically toxic and unpopular?
HOLTZ-EAKIN:  Well, I think there are differences. 
The most important difference is that, in fact, in this bailout, you did get some discipline—there was some bankruptcy—there was some restructuring—whereas, as in Wall Street, literally, the management was never punished for his poor performance.  Stockholders were never forced to recognize the losses that they...
TODD:  And they got bonuses now, too.  They got new big bonuses. 
HOLTZ-EAKIN:  Right.  So, that‘s literally indefensible. 
This one is an important and hard call.  I think, though, you have to recognize three things about the nature of this debate.  The first is that the administration‘s defense is, this is better than what would have happened.  What would have happened is an apocalypse. 
Well, that can never be verified and it‘s a convenient argument.
TODD:  Can‘t prove a negative.
HOLTZ-EAKIN:  But it‘s not substantive at all.
The second is that it‘s a curious notion of profitability when $60 billion of taxpayer money are sitting in there.  Yes, they might have gotten 65,000 jobs.  Yes, there might have been some investments, but there‘s nothing like a return that‘s serious in that kind of an argument. 
We threw a lot of money at this problem.  The return remains to be seen.  And the third point, which is important, is that we actually saw the experiment. 
HOLTZ-EAKIN:  The experiment was, do we plow the money in or not?  We didn‘t in Ford.  And if you look at the best-performing American car company, you look at the one that has the brightest future, it‘s in Ford, not the others. 
TODD:  Well, Ford, by the way, did get a—what was it, a $6 billion loan from the Energy Department to do some of their own.  There‘s always some ways that some of these companies are getting help. 
But I want to go to this other point that Doug made, Heather, which is $60 billion, 55,000 jobs, not the greatest rate of return for government money per job. 
BOUSHEY:  Well, that‘s money that the government has invested in these companies.  It‘s not a one-to-one.  It‘s not that they—they didn‘t give them this money to create jobs.  We make investments.  They‘re loans.  They‘re—they‘re ownership in part of the company. 
It‘s money that—hopefully that we will get back.  But it was an investment in the future of this industry.  And I think that‘s the one thing that‘s a big difference between this and what happened on Wall Street.  We need manufacturing here in the country.  We need it for a variety of reasons.  We need it for the jobs today. 
But we also need it for the jobs tomorrow.  We need it for the jobs and the industries all up and down the supply chain.  It‘s important for our future.  And the kinds of investments that this administration has been making and encouraging the private sector to make in fuel-efficient technologies, in sort of the cars of the future, and all of the new energy-independent stuff that they‘re doing that is associated with this is so important and so urgent. 
And that has, a lot of that, been spurred by the investments that we have made in this sector. 
TODD:  If we get a guy who is as familiar with the auto industry as Mitt Romney is, I have a feeling we could have this debate in two years probably with the both of you.
Anyway, Douglas Holtz-Eakin, and Heather Boushey, have a happy Friday. 
Thank you for coming in. 
TODD:  Up next:  What do Snooki, Winston Churchill and Dan Lungren have in common?  You‘re going to have to tune in to the next segment to find out.  Snooki, by the way, has a beef with President Obama.  And you probably have a good idea, if you know who Snooki is, what that beef is. 
The “Sideshow” is next. 
TODD:  Back to HARDBALL.  Now to the “Sideshow.” 
As you might imagine, late night had plenty of material yesterday with the president‘s sit-down on “The View.” 
DAVID LETTERMAN, HOST, “LATE SHOW WITH DAVID LETTERMAN”:  So anyway, Barack Obama goes on “The View.”  And his critics are saying that the guy is willing to confront radical extremists.  Well—well... 
JIMMY FALLON, HOST, “LATE NIGHT WITH JIMMY FALLON”:  On “The View,” Obama said he won‘t be going to Chelsea Clinton‘s wedding on Saturday because—quote—“You don‘t want two presidents at one wedding.”
FALLON:  Hillary was like, yes, we get it.  You won.  OK?  Big deal. 
UNIDENTIFIED FEMALE:  It‘s telling that he goes to try on the shoulders of the sympathetic women of “The View.” 
UNIDENTIFIED MALE:  Whatever happened to the majesty of the office? 
GOV. ED RENDELL (D), PENNSYLVANIA:  I think there‘s got to be a little bit of dignity to the presidency.
what—by the way, do you idiots have any short-term memory at all?  Is this ringing a bell for you? 

DR. PHIL MCGRAW, HOST, “DR. PHIL”:  Were you all spankers?  Did you thank them? 
BUSH:  Not really. 
JAY LENO, HOST, “THE TONIGHT SHOW WITH JAY LENO”:  Joy Behar asked the president about Snooki, you know, from “Jersey Shore”?
LENO:  Well, President Obama said he didn‘t know who she was.  Yes, which is OK, because Snooki doesn‘t know who he is either.  So, it works out for these guys. 
TODD:  And that was just on “The View.” 
Anyway, as you heard there, Snooki earned a mention in the president‘s interview yesterday.  So, it‘s fitting then that the president also got a shout-out last night on the season premier of “Jersey Shore.” 
NICOLE “SNOOKI” POLIZZI, “JERSEY SHORE”:  I don‘t go tanning-tanning anymore because Obama put a 10 percent tax on tanning.  And I feel like he did that intentionally for us.  McCain would never put a 10 percent tax on tanning, because he‘s pale, and he would probably want to be tan. 
Since taxes were raised on tanning.
Obama doesn‘t have that problem, obviously. 
TODD:  Well, there you go.  You can‘t make this stuff up.  By the way, Snooki was arrested today as she left the beach in Seaside Heights, New Jersey, and was charged with—wait for it—disorderly conduct. 
I know, shock, shock. 
Finally, proof that pols above the law.  Republican Congressman Dan Lungren of California was about to do an interview from his car with a Sacramento radio station when he was stopped by the police.  Take a listen. 
UNIDENTIFIED FEMALE:  We are talking specifically this morning about the passage of the international Megan‘s Law.  Can you tell folks about it? 
UNIDENTIFIED MALE:  Can you hang up the phone, sir? 
REP. DAN LUNGREN ®, CALIFORNIA:  I have to get off the phone just a moment here. 
Can I call you back in just a second?  I‘m sorry.  I‘m talking with a police officer here, sir. 
So, before we get started, you have to at least tell me what happened. 
LUNGREN:  Well, I was driving here probably just slightly over the speed limit. 
UNIDENTIFIED FEMALE:  So, let me ask you this.  Were you written up a ticket? 
LUNGREN:  He‘s coming back to the car in a few minutes.  So, we will find out what‘s happening. 
TODD:  Congressman, can you hang up the phone? 
Well, obviously, he hung it up soon enough, because guess what?  His office says he got off with a warning. 
OK, now time for the “Big Number.”
Winston Churchill‘s dentures, the ones that gave him that trademark lisp, well, they were up on the auction block yesterday.  And the winning bid for the memento billed as—quote—“the teeth that saved the world” $23,723. 
Interesting nugget:  Churchill valued his dentist so much, he nominated him for knighthood.  Churchill‘s choppers sold for over $23,000 at tonight‘s—at last night‘s auction.  And that‘s tonight‘s “Big Number.” 
Wait for Monday‘s “Sideshow,” because Chris Matthews is doing a little stand-up comedy tonight.  And I have a feeling, if he dares, it will be in Monday‘s “Sideshow.”  How is that for a weekend tease? 
All right, coming up:  Are Democrats closing the midterm gap?  Republicans have had all the momentum heading into November.  But, lately, it‘s the two—it‘s the Democrats who are picking up a little bit of steam.  We are going to get into that next. 
You‘re watching HARDBALL, only on MSNBC.  
JULIA BOORSTIN, CNBC CORRESPONDENT:  I‘m Julia Boorstin with your CNBC “Market Wrap.”
Stocks finishing the session flat, but racking up some solid gains for the month of July, the Dow Jones industrials down about a point, the S&P 500 almost completely flat, and the Nasdaq tacking on three points. 
All the major indices wrapping up their best month in a year with gains of around 7 percent.  The day on Wall Street was like a snapshot of the month overall, some solid earnings reports offsetting disappointing economic data. 
In economic news, a weak reading on the GOP drove stocks lower this morning.  Growth slowed in the second quarter, expanding at a lower-than-expected 2.4 percent. 
And consumer sentiment fell to its lowest level in nine months, largely due to the stagnant job market.  But Chevron saw its earnings triple last quarter, boosted by higher oil prices and improving margins at its refineries.
And pharmaceuticals giant Merck beating expectations and delivering a forecast in line with predictions. 
That‘s it from CNBC, first in business worldwide—now back to
TODD:  Welcome back to HARDBALL. 
So, are Democrats really closing the gap in the midterm election? 
With us now, “The New York Times”‘ Jeff Zeleny and “The Washington Post”‘s Dan Balz.
Jeff, let me start with you.  There seems to be a little bit of evidence in national polling, a lot more evidence in state and district-by-district polling that Republicans don‘t have this healthy lead anymore in a lot of these swing districts or Senate races, that the gap has closed. 
What‘s going on here?  Is it just sort of summer vacation, oddball polling, or are Democrats coming home, or is something else going on? 
JEFF ZELENY, “THE NEW YORK TIMES”:  I think, quite frankly, we don‘t know the answer to that question yet.  We need a little more information as the summer goes along.
But, Chuck, as you know, one of the worst times to sort of sample public opinion is in these summer months.  A lot of people aren‘t home. 
TODD:  Yes. 
ZELENY:  People aren‘t paying attention to the news. 
So, but, that said, I think the argument that President Obama and the Democrats have been making, that this is a choice election, it may be gaining some steam among Democratic base voters, who are otherwise a little bit skeptical or not that plugged into what‘s going on. 
So, Democrats are sure happy to take this good news, because they haven‘t had any for a little while.  But we will see it what it really means. 
TODD:  Well, Dan, I want to point out, I‘m not a crazy—I‘m not always a big fan of the Gallup daily tracking poll.  It‘s sort of I say, you live by the Gallup daily track, die by the Gallup daily track, when you‘re trying to handicap things.
But, in the generic ballot for the I think third week in a row, Democrats have led for the week average.  But there‘s still this gigantic gap in enthusiasm.  Republicans lead on this—quote—“enthusiasm gap” among voters in the midterm 46-28 in this thing. 
So, what do you think explains this disparity?  Is this sort of like a lot of Democrats not excited, a little upset, but they‘re going to vote Democrat at the end of the day, and that‘s what they‘re telling pollsters, but they‘re just not happy about it? 
DAN BALZ, CHIEF POLITICAL REPORTER, “THE WASHINGTON POST”:  Well, I don‘t—I agree with Jeff.  I don‘t think we know the answer to that.  And that‘s part of the strategy and hope for the Democrats and the White House is, that they can in one way or another narrow that enthusiasm gap.
I think what is interesting when you look at those Gallup numbers that, while the generic number has moved toward the Democrats, the enthusiasm gap has really not moved noticeably, and it‘s still quite significant on behalf of the Republicans. 
If you talk to Republican pollsters, they will tell that if you begin to look at who are the likely voters, the generic ballot test looks much better for the Republicans.  And they think that that‘s likely to hold. 
Now, as Jeff said, the Democrats are making this argument that it‘s a choice.  It‘s designed to energize their base.  We don‘t know at this point whether that‘s going to happen. 
TODD:  Jeff, I have heard this theory of the case.  OK, they have gotten some of these Democratic independents and some, you know, higher-educated Democratic voters have—quote, unquote—“come home,” gotten out of the undecided column.  But the folks still sitting in undecided and having a very negative view right now about President Obama, but were Democratic before, are seniors and blue-collar white voters, and that those voters—those numbers haven‘t moved at all in any favorable direction toward the Democrats. 
ZELENY:  You‘re absolutely right.  And that is one of the most worrisome signs for Democratic House and Senate candidates, even governor candidates across the country, is just that there has not been any movement at all, even with the signing of the health care legislation, Wall Street reform. 
Those numbers have been sort of flat.  I think the White House and Democrats by and large have—are largely writing off these blue-collar Democratic voters, at least in the midterms.  They think they can get them back in 2012.  That‘s a separate matter. 
But they‘re really focusing on independent women, and—you know, and perhaps some seniors as well.  Some new health care developments will happen this summer in terms of closing the doughnut hole and getting the checks. 
TODD:  Right. 
ZELENY:  That‘s possible.  But, you know, in terms of getting back those—the blue-collar Democrats, it‘s hard to see how a lot that is going to happen in the next three months. 
TODD:  Well, that‘s interesting. 
Take a listen to President Obama, though, on “The View,” which may have been targeted at one demographic group.  But listen to what the president said which actually may be targeted at another. 
Take a listen, Dan.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  The one thing I want to just tell everybody here in this audience, don‘t bet against American workers.  Don‘t bet against American ingenuity.  We still have the best workers in the world, the best technology in the world, the best universities in the world. 
And if we get our mojo back over the next several months...
OBAMA:  ... then I am absolutely confident that we are going to be doing terrific.  But we‘re going to have to make some fundamental structural changes as we go along. 
TODD:  This made-in-America pitch, the president said it twice today at both of those plants.  You heard it yesterday. 
Dan, you have probably heard the same senior White House officials say the same phrase to you as they have said to me, that they think this actually can be a way back into these blue-collar, economically distressed white voters who right now are unhappy. 
BALZ:  Well, the rhetoric may be somewhat helpful, Chuck, but you know as well as anybody that what really will count are the numbers.  And the GDP number that came out today was not particularly good. 
It was not as good as the White House had hoped and some forecasters had expected.  The unemployment rate is still, you know, very high, still close to double digits.  Those are the key things. 
And, in some ways, I think the president is using this kind of rhetoric to buy some time, in the hope that, by the time we get to October, those numbers begin to move in a way that people will say, yes, I guess things are getting better.  But, right now, people don‘t have the confidence that that‘s the case. 
TODD: Jeff, I want to ask you this, “Made in America” rhetoric.  The Chrysler used it today in two places—Chrysler and the G.M. plant used it yesterday.  And again, is this something that may have just focused group well?  Because it seems to be a phrase they have inserted into speeches a lot lately?
ZELENY:  It definitely does.  I mean—because I hadn‘t heard the president saying that, you know, much all year-long.  You know, not through the auto bailout situation.
But, you know—so, it could be a focus group situation.  As you know, this White House, this Democratic National Committee is pulling and focus-grouping constantly.
TODD:  Yes.
ZELENY:  They are looking for, you know, ways they can win people over.  But I think Dan is right.  It‘s more slogan than actual reality here.  And these numbers have to change.
And, frankly, time is sort of running out for the environment to change that much.  Early voting is going to begin in like, you know, five weeks, six weeks in some places.  So, I think the environment we have right now is gelling if not gelled entirely.
TODD:  Excellent point.  As Charlie Cook likes to say, “The cake may be baked.”  At least as far as the view of the economy going into November.
Anyway, Dan Balz, Jeff Zeleny—thank you for making a segment only with folks whose last names have “Z” in it because what else would be better than that?  Plus, the fact that you‘re at two great newspapers.  Thank you both.
BALZ:  Chuck—thanks, Chuck.
TODD:  Up next—all right.
Up next: More than 6,000 graves at Arlington National Cemetery could be mismarked and Senator Claire McCaskill says it‘s because cemetery managers didn‘t do their jobs properly.  Well, she‘s going to join us next to talk about that and what else is going on at the Pentagon.
You‘re watching HARDBALL, only on MSNBC.
TODD:  All right.  Check out our brand new list of the top 10 campaign ads of the cycle on our Web site:  For a taste, take a look at this new ad from Republican Congressman Zach Wamp who‘s running for governor of Tennessee.  The primary is in on a week.
REP. ZACH WAMP ®, TENNESSEE GUBERNATORIAL CANDIDATE:  Here‘s my heart.  I believe God is the center of the universe.  He made us to serve him and to serve others.  We must restore America to its Judeo-Christian heritage and our Constitution.
TODD:  Wamp is actually trailing, you can‘t tell from that ad, whether Wamp‘s running for governor or for preacher.  Watch the full top 10 campaign ads on
HARDBALL will be right back.
TODD:  Welcome back to HARDBALL.
Things got seated during a Senate subcommittee hearing on the dysfunctional management of Arlington National Cemetery.  Up to 6,000 soldiers‘ graves may have been mislabeled.
Let‘s listen to the subcommittee chairwoman, Senator Claire McCaskill of Missouri questioning former Arlington Cemetery superintendent, John Metzler.
SEN. CLAIRE MCCASKILL (D), MISSOURI:  Do you honestly believe, Mr.  Metzler, if you would have come to Congress and say, we‘ve got a crisis; we immediately need resources and manpower so we can check this cemetery because we‘re afraid that we‘ve lost bodies of our heroes.  This is not complicated.  It‘s called keeping track of who you bury where.
TODD:  Joining us now, Senator McCaskill.
So, Senator, I got to ask you: are you convinced this problem is only at Arlington Cemetery?  There are national cemeteries all around this country.  Are you now feeling like you need to look into the management at pretty much all the national cemeteries in this country?
MCCASKILL:  No, the big difference is, that all of those cemeteries are run by Veterans Affairs.  And they have a very strong system in place, I.T. system in place that digitally keeps track of all of the burials.  And you can even go online and find where people are buried in the system.  And their system, by the way, is much larger than Arlington.
TODD:  Good.
MCCASKILL:  And had Arlington adopted their technology 10 years ago, instead of being stubborn and saying, no, we want our own—I mean, this is just a classic case of bureaucracy gone bad—we wouldn‘t be having this problem today.
TODD:  You know, you must hear from—and I always use an example, sometimes, I‘ll say Joe and Jane from Kansas City.  But when I‘m using it with you, you‘re from Kansas City, you‘re from that area.  I‘m sure a constituent is going to come up to you and say, “You know what?  The government can‘t even handle this.  Why should we have faith in the government handling health care, handling these government bailouts?”
You know, this is where the cynicism grows, does it not?
MCCASKILL:  Well, that doesn‘t mean we have an obligation to oversee government.  My job on the subcommittee is to look at contracting—and there a lot of problems with contracting.
You know, the Bush administration wanted to convince everyone they shrunk government.  They did.  They shrunk the acquisition force that watch contractors and then they blew up contracting by many, many multiples.  And we have contracting problems everywhere.
And keep in mind: this is the Army that made this mistake.  And I don‘t think any American thinks that our Army does a bad job.  So, this is an isolated incident within the Army of a very bad example of management and bureaucracy gone badly.
TODD:  Well, you brought up the Army.  It‘s not been a good week for the Army.  There was this report about the high rate of suicides within the Army, the attempted suicides within the Army.
This is—how much of a concern—I mean, this was a report den by the Army.  Part of it has to do with the war.  But they said the war is not an excuse here, that there is really some bad management in how recruiting is done and how the management of officers is done.
MCCASKILL:  Well—and there is—the other thing that report said, Chuck, and this is something that I‘ve been working on since I joined the Armed Services Committee, there‘s a real problem with substance abuse.  We have deployed multiple times, and these guys have been in very stressful situations.  Many of them have had painful injuries and been prescribed drugs.  Many of them may be overindulging in alcohol.
TODD:  Right.
MCCASKILL:  And we have not given them a safe place to get help.  And, usually, when someone is over-medicating like that with alcohol or drugs, it‘s because they‘re having—
TODD:  Right.
MCCASKILL:  -- and it‘s a bad culture to say, I need help.
So, we‘ve started pilot programs where they‘re not going to get reported to their commander if they get help.  And I will tell you, the military gets that they‘ve got a real problem here.  We‘ve had a record number of suicides in Missouri this year in our National Guard.  So, we‘re looking at maybe embedding some mental health counselors here, stateside, within the National Guard units—someone they can talk to besides the chaplain when they‘re—when they‘re feeling those emotional stress.
TODD:  And do you think there needs to be some change maybe in the recruitment process, that maybe they need to raise standards—one of the critiques in this report says that, frankly, standards lowered a little bit and maybe some folks were accepted into the Army, normally wouldn‘t have been accepted, but because they needed the troops, they accepted folks that maybe had a criminal—a criminal background that maybe was a little—shouldn‘t have been forgiven.
MCCASKILL:  Well, I‘m not sure how much that relates to our suicide problem.  But I do think mental health information at the get-go is important because frankly, one of the problems we‘ve seen—sometimes soldiers have been pushed out of benefits because they‘ve said, well, you had a problem before you came.
TODD:  Right.
MCCASKILL:  And in reality, the problem may have developed while they‘ve been deployed or part of the active service.  So, I think these mental screenings, we‘re now making them do face-to-face screenings instead of just checking boxes—this is something we‘ve got to work on, this is an incredibly important resource to our country and the vast majority of people that step across the line are doing wonderful work on behalf of our freedom.
And we‘d just got to make sure that we‘re not just giving them good physical health care benefits, we‘re also giving them good mental health care benefits.
TODD:  All right.  Senator Claire McCaskill, Democrat of Missouri, thanks for tackling some of these tough and—
MCCASKILL:  I got to go watch the Cardinals beat the Pirates tonight, Chuck.  I‘m in a hurry.
TODD:  Yes, I hear you.  Well, get to that game.  Be safe getting there.  Thanks very much.
MCCASKILL:  All right, I will.
MCCASKILL:  Thank you.
TODD:  All right.  Up next: two wedge issues the Republicans may try to use against the Democrats this November: Illegal immigration and Charlie Rangel.  How strong a strategy are these two issues for the Republicans, and can they use it to beat a few more Democrats?
This is HARDBALL, only on MSNBC.
TODD:  We are back.
What do Charlie Rangel‘s ethics charges and Arizona‘s immigration litigation mean for Democrats this November?  Can Republicans use these stories to gain ground and take over Congress, use them as wedge issues?
Well, we‘re going to continue with our conversation with reporters that have the letter “Z” in their name.  Liz Sidoti is the national political reporter for the “Associated Press,” and “The Washington Post‘s” Chris Cillizza, the one who has two Z‘s, the managing editor.
CHRIS CILLIZZA, THE WASHINGTON POST:  Finally, those two Z‘s paid off.
TODD:  That‘s right.  The managing editor—
CILLIZZA:  I‘ve been waiting for years.
TODD:  -- of
Chris, you‘re on remote.  I‘ll start with you.
CILLIZZA:  Thank you.
TODD:  This idea of—let me ask you this—October 15th in 45 House races, how many of them are going to be talking about ethics and Rangel and immigration?
CILLIZZA:  I would say more ethics and Rangel—depending on what happens.  Look, if he cuts a deal sometime soon, maybe it goes away.  The August recess is long this year, it‘s six weeks, almost seven weeks.  So, maybe it goes away.
I think immigration more now, Chuck.  We‘ve seen in California, in the primary there in June, a lot of talk about it.  Meg Whitman winning the governor‘s—Republican gubernatorial race largely because she decided to focus on immigration.  Arizona, John McCain, he‘s now kind of famous/infamous complete the dang fence ad, talking about immigration being challenged from the right.
So, I think it‘s potent in a Republican primary and it‘s clearly potent for base Republican voters.  I think, in a general election, the ethics issue is a little more potent because, remember, 2006, Nancy Pelosi said we‘re going to drain the swamp.
TODD:  Right, drain the swamp.
So, ethics and immigration.  Do you see I think he makes a good argument in the ethics, that we‘re going to see some form of it.  But immigration, he says no.
Are you seeing it in general election ads that you think it will pop up in October?
LIZ SIDOTI, ASSOCIATED PRESS:  You know, not so much.  What we forget here is the core issue right now is the economy.
TODD:  Right.
SIDOTI:  It‘s going to continue to be the economy heading into the fall.  And, sure, immigration played a role in Republican primaries, and ethics played a role in 2006 and 2008 because Democrats bring it on—were going to clean up.
TODD:  It‘s Tom DeLay, those guys.
SIDOTI:  Right.  But what we‘re forgetting here is neither party wants to touch immigration because it‘s such a complex issue.  This is something neither one of them want to deal with.  And on the ethics issue, both parties are flawed.  Both parties have ethical issues.
So, why would you talk about that when you‘re just as flawed especially when voters want to talk about the economy?  They‘ve made that clear.
TODD:  Hey, I want to—go ahead, Chris.
CILLIZZA:  Chuck, I was saying, quickly, the one thing—it‘s possible that Republicans talk about it in direct mail and phone calls to supporters—
TODD:  Yes.
CILLIZZA:  -- as opposed to television ads because it‘s a potential base motivator.  Their base cares deeply about this issue.  I don‘t think do you it in TV ads that are a little bit more scatter shot and reach people that may be turned off by it.
TODD:  Very quick, you two don‘t know this.  This just popped over the wire.  But Senator Ben Nelson, Democrat, is going to vote against Elena Kagan, and he cites her lack of a judicial record.
Chris, are you going to be writing this about 2012 and nothing but 2012?
CILLIZZA:  Chuck, how—your cynicism, yes, I think it‘s—that‘s exactly what it‘s about.  Look, Ben Nelson is in an extremely Republican state.  He won extremely narrowly in 2006.  He‘s going to be a huge target next time and he understands a vote for what most people in Nebraska think is a too liberal president, too liberal judicial pick could be an issue that beats him.
So, yes, he‘s moving to the middle.  Not surprising.  He‘s already there on lots of things.  So, yes, I think it is about 2012.
TODD:  We are seeing much fewer Republicans, about half the number of Republicans that voted for Sotomayor, have said they‘re not going to vote for Kagan.  It seems some of them are a little bit nervous about saying that they voted for both of the president‘s Supreme Court picks.
SIDOTI:  Of course, because Republicans are looking at this and saying, you know, their whole argument right now is: Obama‘s policies are making this country worse.  So, voting for—in lockstep with the president just undercuts that argument.
TODD:  Right.
And, Chris, moving on quickly.
TODD:  I want to bring back something that we brought up earlier.  This “Made in America” line that again we‘re going to—that we‘re seeing a lot more out of the White House, at least this week—
TODD:  -- is this something that you think they‘re testing or something that this—they‘re going to move forward with it and spend a lot of time on it?
CILLIZZA:  Well, Chuck, you know, again, I don‘t want to sound too cynical, but I do think anytime you hear a line coming out of the White House regularly, they‘re testing it to see what works.  Remember, for months and moths and months, we‘ve been hearing focus on the economy, show how things are working, you know, get people—get people to understand the stimulus is working.  This is just part and parcel that have message selling.
TODD:  All right.  We‘re going to let folks get their own Z‘s with all of these Z‘s.
Liz Sidoti of the “Associated Press,” Chris “double-Z” Cillizza of the—thank you both.
That‘s HARDBALL for now.  Thanks for being with us.
Right now, it‘s time for “THE ED SHOW” with Ed Schultz.
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