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The Ed Show for Thursday, July 7, 2011

Read the transcript to the Thursday show

Guests: Michael Steele, Rep. Peter Welch, Adam Green, Eric Boehlert, Laura Flanders, Amy



ED SCHULTZ, HOST:  Good evening, Americans.  And welcome to THE ED SHOW tonight, live from Washington, D.C.—where it‘s all happening.

Democrats are standing up to President Obama on the debt feeling compromise.  Today, Nancy Pelosi drew a line in the sand on entitlements.

Here‘s my message to the president after seeing at least dozen congressional members face to face tonight: under no circumstances should you ever cave on Social Security or Medicare!

This is THE ED SHOW.  Let‘s get to work!




SEN. BERNIE SANDERS (I), VERMONT:  The American people expect the president of the United States to keep his word.

SCHULTZ (voice-over):  Democrats are fuming today over reports that President Obama is proposing cuts to Social Security and Medicare.

Today, the White House is pushing back.

Congressman Peter Welch of the Progressive Caucus is here.

SEN. JIM DEMINT ®, SOUTH CAROLINA:  There would have to be some serious disruptions in order not to raise it.  I‘m willing to do that.

SCHULTZ:  Republicans are refusing to let go of the debt ceiling hostage.  One of the them says: don‘t raise taxes on the rich, raise taxes on the poor.

Former RNC chief Michael Steele is here.

And the Rupert Murdoch News Corp scandal is blowing up bigger than ever.  Tonight, Eric Boehlert of Media Matters on weather Murdoch‘s phone hacking scandal could ever come to America.


SCHULTZ:  Good to have you with us tonight, folks.

President Obama has Democrats shocked, stunned and flat out furious after the “Washington Post” reported that he put Social Security and Medicare cuts on the table.

Now, in D.C tonight, I spoke to at least a dozen lawmakers.  They say that the president went behind closed doors with leadership of both parties to discuss a solution to the debt hostage crisis Republicans are waging on the American people.  President Obama addressed the media after the meeting, but didn‘t take any questions.

Here‘s what he had to say.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  I just completed a meeting with all the congressional leaders from both chambers, from both parties.  And I have to say that I thought it was a very constructive meeting.  Everybody acknowledged that there‘s going to be pain involved politically on all sides.  But our biggest obligation is to make sure that we‘re doing the right thing by the American people, creating an environment in which we can grow the economy and make sure that more and more people would be put back to work.


SCHULTZ:  Now, before she saw the president, Minority Leader Nancy Pelosi held a contentious meeting with her caucus over the proposed entitlement cuts.

Democrats in the House said they felt blind-sided by the story in “The Post.”

Nancy Pelosi is clearly not on board.


REP. NANCY PELOSI (D-CA), MINORITY LEADER:  We do not support cuts and benefits for Social Security and Medicare.  Do not consider Social Security a piggy bank for giving tax cuts to the wealthiest people in our country.  We are not going to balance the budget on the backs of American seniors, women and people with disabilities.


SCHULTZ:  And that is exactly what the polls are saying.  Independent Senator Bernie Sanders spoke with me earlier today on our radio show.  He‘s not happy about this, and after the radio interview, Sanders went to the Senate floor to deliver this very clear message to the president.


SANDERS:  When President Obama ran for the presidency in 2008, he was a strong advocate of Social Security, made it very clear to the American people that he was not going to cut benefits.  The American people expect the president of the United States to keep his word.


SCHULTZ:  Sanders is spot on.  Senator Obama made this promise when he was criticizing John McCain back in September of 2008.


OBAMA:  But John McCain‘s campaign has gone even further, suggesting that the best answer for the growing pressures on Social Security might be the cost of living adjustments or raise the retirement age.  Now, let me be clear.  I will not do either.


SCHULTZ:  Don‘t you think that the Democrats and liberals across this country need to hear the president say the very same thing right now?  And if he doesn‘t, if he doesn‘t, there is an undercurrent in this town that he could find himself in the unemployment line.  It‘s that big of an issue.

New polling in four key swing states tell the story.  Over 50 percent of voters in Ohio, Missouri and Montana say that they will be less likely to vote for President Obama if he makes any cuts.  That‘s any cuts to Medicare/Medicaid benefits.  The same holds true if the president signs off on any deal that cuts Social Security.

President Obama will never win reelection if he loses 50 percent of the voters in a state like Ohio.

Now, there is really good reason—no good reason anywhere to put entitlement cuts on the table with numbers like this.  This is mind-boggling to the Democratic Caucus right now.  I know, I spoke to a dozen of them tonight at a function here in Washington.

Republicans—they will never take it as a tried-off for raising taxes on the rich.

Eric Cantor, he made that crystal clear this morning.


REP. ERIC CANTOR (R-VA), MINORITY LEADER:  I can tell you one thing we are united as Republicans to say now is not the time to raise taxes.  I have talked with the speaker.  He is not for increase in taxes.

We are not for any net new revenues right now.  What we want to focus on is getting people back to work, growing this economy.  That‘s how you increase revenues in this country.


SCHULTZ:  Yes, yes, yes, that‘s a theory that‘s been played out before.

Mr. President, let‘s talk tonight.  You can‘t negotiate with these people.  They‘re not honest brokers.  The Bush tax cuts are a big part of the reason why we‘re in this financial hole.

How about these endless wars that we can‘t get out of and the unfunded Medicare prescription bill that Tom DeLay choked Americans with?

Mr. President, the American people, they‘re on your side, dude.  Maybe if I talk like that, just straight talk.  Just give the president—dude, they‘re on your side!

When it comes to protecting the big three—this isn‘t about solving any phony Republican crisis or building your legacy as a president or even your reelection.  This is so generational and it is so big, it has been so successful for the American people for the last 70 years, why are we going here?

This is about millions of people who depend on Social Security to keep a roof over their head, to put food on their table.  And if you go cut a deal with these folks, you will have done more damage to destroy the New Deal than any Republican president has ever done.

Now, I want all of us tonight to think about Grant Park on election night.  Think intensely for a moment about Grant Park, the night the president of the United States won the election.  I mean, there was emotion going on, there was feeling in the crowd.  I mean, if you‘re sitting at home watching it, it was an unbelievable television moment.  The country felt great.

Could you in your wildest dreams, if you can remember back to that night at Grant Park, if the president had said, “We‘re going to have change, and within 30 months I‘m going to have Social Security, Medicare and Medicaid cuts on the table”?

That‘s how much things have changed.

The lawmakers that I talked to tonight, they are stunned.  This “Washington Post” story that came out last night—they‘re so uptight about this.  Whoever leaked that to “The Washington Post” in the Obama administration should be fired!  That‘s irresponsible playing with people‘s lives.

Because, you see, this is serious stuff for a lot of folks.  You cut $500 out of somebody‘s fixed income, you‘re really messing with their life.  And if this is some political balloon that the Obama administration let go in Washington, D.C. just to see how many people would look up in the sky to see if it‘s really true, this is a bad move.  And now, you‘ve got the Democratic Caucus furious, losing confidence, not sure about that guy that was at Grant Park.

And the Republicans, they‘re behind closed doors.  We can only imagine they‘re saying, you know, we got ‘em right where we want ‘em.

We have President Obama and his people floating stories about putting Social Security, Medicare and Medicaid on the table for cuts.  This is something George Bush couldn‘t even do.  Bush couldn‘t get these cuts talked about.

Leave it to Obama, he can.

This is really a crossroads for a lot of liberals in this country—a real crossroads.  And it is such a divided highway ahead it could derail what President Obama has accomplished because he won‘t win a second term.  Because there‘s going to be a lot of people who are going to go home, and they‘re going to say, well, I really like the president, he‘s a great guy, but I can‘t vote for this.

And losing the White House would not be a good thing.

Get your cell phones out, I want because he won‘t win a second term.  Tonight‘s question: should Democrats vote for entitlement cuts in exchange for raising taxes?

Text A for yes, text B for no to 622639.  You can always go to our new blog at  We‘ll bring you the results later on in the show.

I do need two shows tonight.  In fact, I need three shows tonight. 

And I am burning in the belly over this one.

My next guest is, too.  Congressman Peter Welch, Democrat of Vermont, member of the House Progressive Caucus.

Am I understating this?

REP. PETER WELCH (D), VERMONT:  You‘re not the master of understatement, but your, Ed, style is appropriate for the situation.  This could be the most serious vote that we take on domestic policy for all of those who serve in Congress.  What‘s happening here is we have this debt crisis.  We‘ve got the debt ceiling coming up, we‘ve got to pay our bills.

And the majority of the Democratic Caucus, by the way, voted for the debt ceiling so that we‘d pay our bills.  And that included, by the way, many of us who voted for it who were against the Iraq war, who were against credit card funding of the Afghanistan war, who were against the Bush tax cuts, who were against prescription drug part D, but Congress voted for it, Americans voted for it and we have to pay our bills.  We did that.

SCHULTZ:  I have a few congressional members tell me tonight that they met with the president a month ago, and they asked him, are you going to throw us under the bus?  And they‘re telling me tonight they were thrown under the bus.  Do you feel that way?

WELCH:  Well, you know what, what I‘m hoping is this.  When the president is talking about Medicare and Social Security, it‘s about making Medicare and Social Security strong, survivable and sustainable.  And when President Reagan and Speaker O‘Neal, Democrat and Republican, joined hands on Social Security, it was about making it stronger.  It wasn‘t about raiding Social Security to cover tax cuts for the rich.

So that‘s the real question.  There is enormous anxiety.


SCHULTZ:  Listen, to what we‘re talking about here.  Why are we even talking about this when you‘ve got 80 percent of the American people who don‘t want to go down this road?

WELCH:  There‘s two interpretations.  Number one, we shouldn‘t be doing it, because Medicare should be discussed on its own terms.  We‘ve got to bring down the cost of health care and that‘s important not only for Medicare but it‘s important for the rest of the health care economy.

But it‘s not about using Medicare as a way to maintain tax cuts for the top 2 percent of Americans.  Social Security is the absolute bedrock of middle class security, and we cannot be using that as a piggy bank to pay for taxing the wealthy.

SCHULTZ:  Will the president have support if he comes out with a plan that cuts the big three in any way, shape or form?  Will he get the votes?

WELCH:  No, he won‘t.  And this is where I have some optimism.  In the Republican Caucus, they won‘t take yes for an answer.  They basically want to drive government into the ground.

SCHULTZ:  No doubt about that.

Yesterday, the president had this to say about using the 14th Amendment of the Constitution to get around this debt situation.  Here it is.


OBAMA:  I don‘t think we should even get to the constitutional issue. 

Congress has a responsibility to make sure we pay our bills.


SCHULTZ:  Today, Chuck Grassley, senator from Iowa, actually admitted the president could use the 14th Amendment of the Constitution.  Should he do it, in your opinion?

WELCH:  You know what?  I don‘t think he should.

I think Congress should hold firm.  I think the Democrats should hold firm.  We should defend Social Security, we should defend Medicare.  We shouldn‘t use a legalistic argument.

This is about basic Democratic values.  Do we believe the middle class is entitled, when they get to be 65, to access to health care that they can afford?  Do we believe that if you‘ve worked hard all your life, you should have some help in your retirement when you‘ve paid into Social Security?

SCHULTZ:  But you would not advise the president to use his constitutional powers in the 14th Amendment to do this?

WELCH:  I would advise Congress to hold firm.  I would advise the Democrats to hold firm.

SCHULTZ:  Democratic Congressman Peter Welch, great to have you with us tonight from Vermont.

The fact we‘re just a couple weeks away from America defaulting on its obligations for the first time ever rested squarely on the back of the Republicans.  The president and the Democratic Senate no doubt would sign up right away for a clean up and down vote on rages the debt ceiling.  I think they would do it in a heartbeat.  But Republicans are using the deadline as a weapon to roll back the progress of the 21st century.

Today on CNBC, one of the smartest men in America, Warren Buffett, called  out Republicans for what they‘re doing.


WARREN BUFFETT, BUSINESS MOGUL:  We raised the debt ceiling seven times during the Bush administration.  And now, in this administration, they‘re using it as a hostage, and you really can‘t play Russian roulette to get your way.

When you have someone holding a gun to your head, do you come out with

a most properly reason for something?  They‘re trying to use the incentive

now that we‘re trying to blow your brains out, America, you know, in terms of your debt worthiness over time—and that‘s being used as a threat.



SCHULTZ:  Joining me now is former chair of the RNC, Michael Steele.

Mr. Steele, great to have you with us tonight.


SCHULTZ:  Is this a great day for Republicans?  You‘ve got the president talking about cuts, something you folks have been after for 30 years.

STEELE:  Well, you know, I think—I listen to the Congress and I listen to you, and I think the passion is in the right place, and I think America needs to be passionate in this debate right now.

I‘m glad to see the president put something on the table.  Now, it‘s upset his base.  The passion that you‘re showing about cutting Social Security and Medicare is the same passion a lot of Republicans have about raising taxes—and I think this is where we begin to get to net cutting time.

If we can bring those passions into the room, let‘s be serious about putting it all on the table and come in with something that keeps Social Security vibrant and strong but also recognize that we can‘t continue to spend the way we are.

SCHULTZ:  Social Security, according to Bernie Sanders telling me today, it‘s not in financial trouble for 25 years.  We don‘t have to do anything to make it solvent right now.  We can do that down the road in a bit.

But do you think that the Republicans will actually say yes to tax increases?

STEELE:  I think what you saw today, Ed, was an opening for Speaker Boehner on this point where he talked about—let‘s look at those entitlement programs on the tax side with respect to, you know, the giveaways and the tax breaks and everything that‘s been built into the system over the last 35 years since the last time we reformed the tax system.  So, I think there is a beginning now, an opening.

SCHULTZ:  So you think the Republicans will go for raising some taxes?

STEELE:  I think the Republicans will be in a position to talk about reducing or eliminating the tax breaks that are currently given to a lot of corporations -- 

SCHULTZ:  Do you think Cantor will go along with that?

STEELE:  I think ultimately they‘ll have to, because the reality on August 2nd and beyond is, how are you going to pay the nation‘s bills?  How are you going to deal with the continued expenditures we already have locked in if you don‘t begin to address those expenditures on the front end?

SCHULTZ:  And what about this conversation with Congressman Tim Scott of Florida who said Republicans would impeach the president if he tried to circumvent Congress with the debt ceiling invoking the 14th Amendment?

STEELE:  OK, Ed, again, the hot rhetoric—


SCHULTZ:  Well, he said it.

STEELE:  He said and there‘s a lot of that on both sides.  You raised the question about the 14th Amendment.  The president himself has said we don‘t need to bring the constitutional options -- 

SCHULTZ:  That‘s because he wants to make a deal.

STEELE:  Of course he does.  He‘s approaching it the right way.  I think Speaker Boehner is approaching it the right way.

SCHULTZ:  But you‘ve got Rand Paul in the Senate saying he‘s going to filibuster everything until he gets his way.  And that means cutting the big three and not raising taxes.  How do you get around that?  We‘ve got 80 percent of the American people saying don‘t move on that.

STEELE:  That‘s got to be something Mr. McConnell and leaders of the Senate will have to deal with.  It‘s going to be something Boehner will have to deal with in his caucus in the House, and it‘s going to be something the president will have to deal with on the left as well.

SCHULTZ:  You know, this is the longest conversation I‘ve had with a Republican over this?  You guys are wrong!  You guys are so wrong -- 

STEELE:  I appreciate your passion, but—and we feel you‘re wrong, and that‘s where we come to some approach where we talk about how we solve this.

SCHULTZ:  But, Michael, there is 80 percent of the American people saying don‘t touch this.

STEELE:  But you also have a significant number of people saying cut and stop spending.

SCHULTZ:  What, 20 percent?

STEELE:  No, it‘s more than 20 percent.


SCHULTZ:  I need three shows.

STEELE:  All right.

SCHULTZ:  MSNBC analyst and former RNC chair, Michael Steele, with us tonight—thanks so much.

Remember to answer tonight‘s question there at the bottom of the screen.  I want to know what you think.

In a swing state poll, voters say the rich should be taxed more with no cuts to Social Security, Medicare and Medicaid.  So Democrats better listen up.

And later, scandal rocks Rupert Murdoch‘s media empire—phone hacking allegations shut down a major tabloid newspaper in Great Britain.

It‘s all coming up.  We‘ll be right back.


SCHULTZ:  As political leaders battle out raising the debt ceiling,

psycho-talking congressman from Georgia, Paul Broun, is—well, he‘s going a different direction.  Broun introduced a bill to lower the debt ceiling by $1.3 trillion.  The plan is so off the wall, the anti-spending Tea Party Senator Rand Paul isn‘t even on board.

But that‘s not stopping Broun.


REP. PAUL BROUN ®, GEORGIA:  Over the last decade, we‘ve raised the debt ceiling 16 times.  That hasn‘t worked out so well.  We need to do something that is very much different and that‘s what my bill does.

UNIDENTIFIED MALE:  Are you giving up a little bit on revenues, on that side, whether it‘s tax increases, whether it‘s closing loopholes—will you give up a little there?

BROUN:  Raising taxes is not going to do anything but put a tax on jobs, and we‘ll have less jobs by raising taxes.  So, if we do anything, we need to lower taxes on small businesses.


SCHULTZ:  So, Paul Broun wants to lower the debt ceiling by more than a trillion dollars, but he still won‘t raise taxes.  These righties are really showing where their loyalty lies, you know it?  And it ain‘t with the middle class America.


SCHULTZ:  Welcome back to THE ED SHOW.  Thanks for watching tonight.

Don‘t you think the message is pretty clear, go ahead and tax the rich?  That‘s what swing state voters are saying, and the polls show it.  And they‘re saying no to cutting the big three, Medicare, Medicaid and Social Security.

And you better listen up, Democrats.  According to the same poll, cutting the big three would affect your chances at reelection.

Question: in order to reduce the national debt, would you support or oppose raising taxes on those with incomes over $150,000 a year?  In Ohio, Missouri, Montana and Minnesota support for raising taxes ranges from 58 to 67 percent.  Support goes even higher for taxing those making $250,000 a year.  And support for taxing millionaires ranges between 76 and 79 percent.

So, raising taxes, you know—it looks pretty popular right now.

Want to know what is not popular?  Cutting Social Security, opposition ranges between 72 and 80 percent over those states I mentioned.

Medicare, 69 to 76 percent opposed to cutting it.

Medicaid, 59 to 63 percent opposed cutting Medicaid.

And voters in those four states said that they would be less likely to vote for their senator if he or she cut Social Security, Medicare or Medicaid, and they said that they would be less likely to vote for President Obama if he cut the big three.  Now, if you believe in polls, it‘s a slam dunk.

Let‘s bring in Adam green, co-founder of the progressive change campaign committee, which is one of the groups that commissioned this poll.  If this is true, Adam, and it‘s great to have you with us tonight—

750,000 people are in your organization.  If this news is true, what does it mean?

ADAM GREEN, BOLDPROGRESSIVES.ORG:  Well, first of all, it means that millions of people, people like my grandmother and the grandmothers of the future, will be very, very hurt, especially in this tough economy.  The middle class has sacrificed enough.

Politically, it would be absolutely devastating for Democrats.  Two of the biggest accomplishments of the Democratic Party are Social Security and Medicare.  George Bush was not able to put these things on the table, and we don‘t need a Democratic president doing this.

As your polls show, it would be really devastating to Democrats in 2012 who are on the ballot if we cut Medicare and Social Security.

SCHULTZ:  What do you want the president to do if he does show up with the plan of hitting the big three?

GREEN:  Look, we are already taking action.  It‘s important to be honest in saying, look, President Obama, if you cut Medicare and Social Security, you know, we‘re not going to vote for Sarah Palin in 2012, but we cannot in good faith give our money and volunteer time to your reelection campaign.  That‘s not change we can believe in.

So, just recently, over 150,000 people have taken a pledge that they will withhold their grassroots support in this president if he goes down this road.  Those are people who gave over $10 million to this president in 2008 and over 2 million volunteer hours in 2008.

SCHULTZ:  Two million volunteer hours.  Could the president win without that help?

GREEN:  He can try.  He seems to be going into Wall Street‘s cauldron recently.  But we really hope wises up and decides to have a people power campaign.  Bu that means standing strong with Social Security and Medicare.

SCHULTZ:  What about the Democrats?  They asked the president a month ago, are you going to throw us under the bus, and some of them tell me tonight they‘ve felt like they‘ve been thrown under the bus and they‘re at a critical moment right now.

They have to hold the line, don‘t they?

GREEN:  Absolutely.  As you said, we had some real heroes today, in the last 24 hours, Sheldon Whitehouse, senator from Rhode Island, Peter Welch who was on before and some others, are really saying, we will not take part in this hostage situation.  We‘re not going to vote for something that‘s labeled a final deal by the president that the American people don‘t agree with.  And they deserve all the credit in the world.

SCHULTZ:  These numbers are greater than the public option, which you are an advocate of.  And you said, Mr. President, you got to go down this road of the public option.  The public is on your side.  Why in the world would the president even invite this to discussion when he has such massive numbers on his side?

GREEN:  Yes, it‘s a great question, and the honest answer is that this White House is under the kind of warped strategy impression that they need to cut a deal, that they need a compromise above all else.  But what they need to understand is that the American people don‘t simply want a deal, they want a Democratic Party that is fighting for every day working families.

SCHULTZ:  Do you think this is a trial balloon, maybe a political ploy by the White House just to get everybody cranked up just to make sure they never get touched?

GREEN:  Unfortunately, that‘s a best case scenario.  I hope it‘s only a trial balloon.   But, you know, there are some real legitimate fears.

SCHULTZ:  But how could the president not understand the severity of the damage he would do to the Democratic movement and party if he were to allow something like this to happen?

GREEN:  It‘s a fair question.  I don‘t know, but the damage would be done.

SCHULTZ:  Constitutional move.  Are you for it?  Should the president do it on the 14th Amendment?

GREEN:  Absolutely.  Any negotiation, at the end of the day, the question is, well, if nothing happens, who wins?  If the debt ceiling is about to get stumbled upon currently, the Republicans will win.  If President Obama says, you know what, I have this option.  The debt ceiling is actually unconstitutional and I will exert that option, that gives him a ton of leverage in the fight, that means he can fight harder for Social Security.

SCHULTZ:  Adam Green of the PCCC, great to have you on tonight.   Your organization is spot on.  No doubt.

Next, health care for all.  How you can help folks in New Orleans get the care they need.

One side has said Social Security is off the table, the other said tax increases are off the table.  They both can‘t—they can‘t both be right, OK?  Tonight, ED SHOW panel helps me figure out which side has the upper hand in the debate of the debt ceiling.

Stay with us.


SCHULTZ:  It means so much to so many, and it‘s only possible with your help.  I just want to remind you about the free health clinic that we‘ve got coming up August 29th in New Orleans, Louisiana.  Once again, MSNBC and THE ED SHOW, we are teaming up with National Association of Free Clinics.  In the past, it‘s been our publicity, but it has been your generosity that has helped countless Americans, thousands of patients, get the care they need and needed and might not have, you know, if it hadn‘t been for your help. 

They wouldn‘t have gotten it otherwise.  And I want you to make a donation.  Or to learn more about volunteering at the New Orleans clinic, visit their website at  You can also text the word HEALTH to 50555 to make a 10 dollar donation by cell phone.  Please help us. 

Coming up, Rupert Murdoch‘s media empire takes a hit.  Rocked by scandal, “The News of the World” shuts down.  What does this mean for Murdoch‘s right wing echo chamber right here in the United States? 

And Utah Senator Orrin Hatch declares class warfare on the floor of the Senate.  He wants poor people to fork over more money to pay off the national debt.



UNIDENTIFIED FEMALE:  Breaking news on News Corp.  The media conglomerate is shutting down its “News of the World” U.K. tabloid, saying that this Sunday will be the last issue of “News of The World.” 

UNIDENTIFIED MALE:  Can we say with certainty, (INAUDIBLE), or anybody else, for that matter, that these hacking practices were limited to “News of the World?”

UNIDENTIFIED FEMALE:  I think that‘s what the market is worried about. 

I think that‘s what investors are worried about.  We don‘t know. 


SCHULTZ:  At this hour, we really don‘t know just how far reaching the scandal that rocked Rupert Murdoch‘s media empire will be.  But tonight, the fallout continues.  There will be two official inquiries into the phone hacking controversy that led to the demise of one of the planet‘s largest newspapers, British tabloid “The News of the World.”

Murdoch heir apparent James Murdoch pulled the plug on the 168-year-old paper earlier after more allegations surfaced.  Thousands of cell phones have been targeted by Murdoch‘s deputies, including the voicemail of a 13-year-old murder victim, as well as the voicemails of families of British soldiers killed in action. 

The paper is also accused of paying—paying police for information.  For his part, Rupert Murdoch avoiding answering questions earlier today in Idaho.  So what does this all mean for the right wing media empire Murdoch runs in this great country, the United States of America? 

Here to answer that question and many others is Media Matters senior fellow Eric Boehlert.  Eric, good to have you. 

What the heck is going on here?  How far reaching is this?  What do you think? 

ERIC BOEHLERT, MEDIA MATTERS FOR AMERICA:  It‘s very far reaching.  You know, Murdoch was engaged in this sort of Nixonian cover-up.  And this week, it turned out to be about as successful as Nixon‘s Watergate cover-up. 

This has been drip, drip, dripping for years.  And Murdoch has refused to take responsibility.  He‘s refused to hold his key executives responsible.  In fact, he‘s promoted them. 

Now when it all collapsed like a house of cards this week, with this extraordinary exclusive about the murdered girl‘s phone being hacked, you know, it all fell apart and Murdoch doesn‘t have anywhere to turn.  He is in free fall. 

SCHULTZ:  Do you think he knew about this?  Do you think he knew about these tactics? 

BOEHLERT:  I don‘t think anyone at News Corp has been able to really accurately suggest that this did not go to the highest levels of the company, whether it‘s his son, whether it‘s him, whether it‘s the publisher of the newspapers. 

These are all very, very senior people who have been touched by this.  And he refuses to let any of them go.  He shuts down a newspaper, a 2.3 million circulation newspaper today instead of firing key executives.  It‘s really quite extraordinary. 

SCHULTZ:  Eric, there are people at Fox News and certainly people at the “Wall Street Journal” that have been in the news business for a long time. 


SCHULTZ:  It would seem to me that maybe a writer for the “Wall Street Journal” would unequivocally say that they‘ve had nothing to do with any of this kind of stuff.  Are they at that point right now?  Do they have a credibility problem with the American people? 

BOEHLERT:  I think Fox News has a credibility problem with the American people.  I think the “Wall Street Journal” does not.  Look, talk about how far this goes, the publisher of the “Wall Street Journal” used to run Murdoch‘s British newspaper when this rampant hacking was going on.  And then Murdoch tapped this executive, Les Hinton, to oversee an internal investigation a couple of years ago. 

He goes before Parliament and he says, oh, we‘re clean.  You know, it was one  or two rogue people.  We don‘t see any evidence of widespread wrongdoing.  And that‘s what he tells Parliament.

And now he‘s rewarded as the publisher of the “Wall Street Journal.”  He either oversaw one of the most inept internal investigations ever, or he was trying to cover something up.  This is the probably that this has. It extends throughout the News Corp company now. 

SCHULTZ:  British police say they‘re going to arrest former “News of the World” editor, who also worked for the prime minister.  Fox News has had ties to previous White Houses.  Should Americans be concerned about the relationship Fox News has with the right wing? 

BOEHLERT:  Absolutely.  Again, this is—

SCHULTZ:  Do you really think that this is happening in the United States? 

BOEHLERT:  I don‘t think this is happening in the United States.  This is more of a culture—a fleet street culture in London.  They do play much faster and looser with the rules, even more than Fox News does. 

Look, this is how Murdoch plays the game.  There are no rules.  We make them up as we go along.  Watch Fox News for 24 hours.  Do you think anyone on that cable channel thinks that common sense rules apply to them?  This is their badge of honor; we make up the rules as we go along and to heck with anyone else. 

This—in London, they obviously took it far beyond what anyone thought was imaginable.  But again, Murdoch could have dealt with this years ago.  He refused to.  He tried to cover it up.  And like Nixon, it‘s all collapsed. 

SCHULTZ:  What do you think his next move‘s going to be, Rupert Murdoch?

BOEHLERT:  I don‘t know.  he—they shut down the newspaper.  They hope that will be it.  But frankly, the cynics are saying well, he was going to brand this anyway.  He was just going to merge with “the Sun.”  He‘s just saving some money. 

Look, there is going to be future investigation.  And there might be more arrests.  This is a total disaster. 

SCHULTZ:  They‘ve launched a campaign against Media Matters.  What about your phone? 

Eric Boehlert, good to have you with us tonight.  Thanks so much. 

Senator Orrin Hatch is trying to squeeze every penny out of America‘s working poor.  But he‘s mad at Democrats for wanting to raise taxes on billionaires.  Psycho Talk is next.


SCHULTZ:  In Psycho Talk tonight, Utah Senator Orrin Hatch.  He doesn‘t think poor people, you know, they‘re pulling their weight in this economy.  This week, the Senate started debating a resolution about raising taxes on millionaires and billionaires.  But Republicans like Hatch are still defending the top one percenters. 


SEN. ORRIN HATCH ®, UTAH:  I get a little tired of hearing the Obama approach toward shared sacrifice.  The top one percent and the so-called wealthy pay 38 percent of all income taxes.  The other side just spends and spends and spends.  And they want to tax and tax and tax, so they can spend some more. 

My gosh, when are we going to wake up in this country and realize they‘re spending us into oblivion? 

I hear how they‘re so caring for the poor and so forth.  The poor need jobs.  And they also need to share some of the responsibility. 


SCHULTZ:  What planet is this guy living on?  A couple years ago, taxpayers bailed out those top one percenters.  But now most Americans have been left out of the economic recover. 

Since 2009, corporate profits have accounted for 88 percent of income growth in this country.  Only one percent of income growth went to wages, senator.  In fact, average wages in America have actually gone down since 2009, senator. 

Meanwhile, the top one percent is raking it in.  Executives at the largest U.S. companies got an average pay raise of 23 percent last year.  But somehow, Orrin Hatch doesn‘t think those folks are getting a fair shake.  He wants to keep bleeding the working folks of America day by day. 

For Senator Hatch to say poor people should do more to pay off the national debt, while he opposes tax increases for millionaires, is out of touch elitist Psycho Talk. 

If President Obama approves a deal that puts Social Security and Medicare on the chopping block, he is guaranteeing a loss in 2012, according to some Democrats.  THE ED SHOW panel joins me next to try to figure out the president‘s end game to this debt ceiling deal.  Stay with us.


SCHULTZ:  And finally tonight, the debt ceiling debate has left both liberals and conservatives questioning the behavior of party leaders here in Washington.  Earlier tonight, this is what Congressman Peter Welch had to say about his fellow Democrats‘ reaction to any deal that included Social Security cuts. 


REP. PETER WELCH (D), VERMONT:  Social Security is the absolute bedrock of middle class security.  And we cannot be using that as a piggy bank to pay for taxes for the wealthy. 

SCHULTZ:  Will the president have Democratic support if he comes out with a plan that cuts the big three in any way, shape or form?  Will he get the votes? 

WELCH:  No, he won‘t. 


SCHULTZ:  So how are the liberals reacting to the idea that the Democratic president might sacrifice the bedrock ideas of progressive government to get this deal?  And how do conservatives feel about the way Republicans are forcing the president‘s hand by playing chicken with our economy? 

Let‘s turn now to my radio colleagues, who have diverse opinions on this issue.  Laura Flanders is the host of Grit TV and Free Speech TV, as well as host of Grit Radio.  And Amy Holmes is the co-host of “America‘s Radio News.” 

Great to have both of you with us tonight.  All right.  You‘re a conservative, Amy. 


SCHULTZ:  What‘s a good deal?  What is a good deal here? 

HOLMES:  I think a good deal is one that leaves our government spending less, because, as we all know, we can pay down our credit card.  But if we haven‘t changed our patterns of spending, we‘ll run them right back up.  What we know from Reuters reporting today is that the White House threw out two trillion, three trillion, four trillion. 

I think what we really want to see behind that is Washington‘s commitment to fiscal sobriety. 

SCHULTZ:  Laura, what‘s a good deal for liberals here?  What do you think?

LAURA FLANDERS, GRIT TV:  You heard what Raul Grijalva said earlier this evening.  He said this is the fight of their lives for Democrats.  I think it‘s not about a deal.  It‘s about gaining some strength in that fight, about showing some fight if you‘re a Democratic leader. 

It‘s kind of false equivalency, I think, the Tea Partiers and the quote, unquote, liberal left.  The numbers you‘ve been putting out all evening show that the entire country is ready for a defense of the big three.  And it‘s that that I think is at stake. 

So we can talk Beltway deals, but really, we need to be talking about people.  And it‘s not just the far left and Tea Party issue that‘s getting played out here. 

HOLMES:  Now, it might surprise you, Ed, that the president said something today that I agree with, which is that this is going to politically hurt both parties if they do the right thing. 

SCHULTZ:  He used the word pain. 

HOLMES:  There‘s going to be pain if they do the right thing.

SCHULZ:  Why is there going to be pain if—


HOLMES:  You look closer at that polling data, you see that the majority of people don‘t want to raise the debt ceiling limit at all.  And when you look at Social Security, they want reform, but they don‘t want their Social Security check to be affected.  They don‘t want their retirement age to go up.

So both sides have to come together and make some politically tough decisions in order to get these entitlement programs on fiscal footing.

FLANDERS:  There‘s a difference here.  This is not the first time that Barack Obama has blinked on his base and on the issues that his base cares about.  There is a feeling out there in the country amongst exactly those people who the president will need to get reelected in 2012 that it is beyond blinking. 

It is simply putting a closed eye to the real pain that they‘re feeling.  This has not been shared pain.  And the conversation we should be having is about who is living high on the hog in this economy.  And half the billionaires you talk to these days, not those funding the Tea Party, but the others—Warren Buffett, you talked to him recently—are for seeing their own share of quote, unquote, pain go up. 

SCHULTZ:  Amy, income disparity—disposable income is shrinking for middle class families.  That‘s one of the reasons we‘re in this, quote, new normal.  People don‘t have disposable income to move the economy.  And you got almost 10 percent unemployment. 

HOLMES:  I agree with that, but I don‘t see how corporate jet taxes are really a part of that equation.  You could confiscate every corporate jet in America and you wouldn‘t get anywhere close to closing this deficit.  That kind of class warfare rhetoric is not what‘s going to turn this ship around. 


FLANDERS:  It‘s fairness rhetoric.  It‘s American rhetoric, about how do we advance this country as a whole?  The only reason we‘re in this problem is that our revenues have been shrinking.  And what will be required to turn that around is to put more people back to work.  This is a time for spending for American fairness. And it‘s a time for spreading the pain where it hasn‘t been felt, which is at the top. 

SCHULTZ:  So I want to ask both of you—here‘s where we are.  The Republicans are saying no tax increases.  The Democrats—and I‘ve talked to a lot of them tonight here in Washington—they‘re saying there is no way in hell that they‘re going to vote for something that is going to chip away at the big three.  So what‘s the end game? 

HOLMES:  As you heard, Eric Cantor in the House, Republican leader, he said that, in fact, Republicans could put on the table closing those tax loopholes.  So a tax loophole for one person is actually a tax break for another.  He said he‘s willing to get rid of it.

That big money is going to come from entitlement programs. 


HOLMES:  Those are social welfare programs for the middle class. 

That‘s what Social Security, Medicare—

SCHULTZ:  Social welfare?  People pay into --  


FLANDERS:  Social Security, as has been pointed out here, is no cause of the deficit.  It should not be raided to solve something it didn‘t cause, that‘s clear. 

If we‘re going to get into the minutia, we need to remember what people are dealing with in this country.  I have a very close friend that retired this month.  She was earning at the end of the day, taking home 300 dollars a week.  She is going to be bringing in about 500-something a month on benefits. 

When they talk about changing the calculus, we‘re talking about that kind of money being lost every year to those people, and that hurts. 

SCHULTZ:  I said earlier tonight in this program, remember Grant Park?  That emotional scene when President Obama won election in 2008?  What if the president, Laura Flanders, has said, I‘m going to give you some real change.  In 30 months, I‘m going to be talking about going after the big three?  See how we‘ve changed?  What about that? 

FLANDERS:  I would only add one thing, which is that there are still some days to go here, before the final floor hits on this debt ceiling.  And I think that there is a chance for the Democratic leadership still to really shame the Republicans who are holding that gun to this country‘s head. 

There is a lot of discomfort about that, even in Republican -- 

HOLMES:  And to make Obama supporters even more angry, what if he had told them he was going to keep those Bush tax cuts for every income level? 

SCHULTZ:  There you go.  He‘s caved in on a lot of stuff.  No public option, no universal health care.  He caved in on the Bush tax cuts.  He‘s done some good things, too.  But this is the bedrock issue that—


FLANDERS:  He‘s got the progressive caucus making a pledge.  He‘s got the National Nurses United making a pledge.  They‘re playing a hard game here.

SCHULTZ:  Amy Holmes, Laura Flanders, you‘re just two reasons why I need another hour.  All right, good to have you with us tonight.

Tonight I asked, should Democrats vote for entitlement cuts in exchange for raising taxes?  13 percent of you said yes, 87 percent of you said no.  That‘s the ED SHOW, I‘m Ed Schultz.  See you Monday night.  Have a great weekend.  You can listen to my radio show on Sirius XM Channel 127 Monday through Friday, noon to 3 p.m.  “THE LAST WORD” with Lawrence O‘Donnell starts right now.  See you Monday.  I‘m going fishing (ph).



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