IE 11 is not supported. For an optimal experience visit our site on another browser.

'Hardball with Chris Matthews' for Wednesday, August 31, 2011

Read the transcript to the Wednesday show

Guest Host: Michael Smerconish
Guests: Chuck Todd, John Harris, Jonathan Martin, David Corn, Brad Goode, Michael Steele, Dana Milbank, Richard Lardner

MICHAEL SMERCONISH, GUEST HOST: President Obama tries to rain on the
Republicans` parade.

Let`s play some HARDBALL.

Good evening. I`m Michael Smerconish in New York for Chris Matthews.

Leading off tonight: A split-screen moment. It`s not often that we at
MSNBC find ourselves to be part of the news, as opposed to just covering
it, but that`s what happened today. President Obama tweaked the Republican
presidential candidates by scheduling his big jobs speech to a joint
session of Congress for next Wednesday at 8:00 PM. That`s exactly when the
Republican debate is scheduled to air on this network.

The Speaker of the House, John Boehner, who has yet to approve the
request, tweeted the president right back saying, in effect, Why don`t you
try Thursday? It`s a delicious bit of political gamesmanship, and we`ll
get to it right at the top of the program.

Also, Democrats may not like any of the Republican candidates,, but
chances are, they reserve a particular fear and loathing for Rick Perry.
Yes, his positions are extreme and light-years from the mainstream, but
that`s only part of the problem. The real worry for the Ds? He could win.

Plus, how serious really are Republicans like Eric Cantor about
holding up FEMA spending for Hurricane Irene until other programs can be
cut to pay for it? That`s what Eric Cantor is insisting on, but that`s not
how he felt when it was his district that needed FEMA help seven years ago.

And if you`re worried about the cost in the wars in Iraq and
Afghanistan, this won`t help. A congressional commission reports that as
much as $60 billion has been lost to waste and fraud in two wars. How`s
that going to play in an age of record deficits?

Finally, one Republican still can`t decide, Should I get in or not?
Here`s a hint. It`s not Sarah Palin. Check that out in the "Sideshow."

We start with the president`s decision to make his jobs speech next
Wednesday at exactly the same time as the Republican debate. Chuck Todd
is, of course, NBC`s chief White House correspondent and political
director, as well as the host of "THE DAILY RUNDOWN" on NBC. And John
Harris is Politico`s editor-in-chief, and he will moderate the debate,
along with NBC`s Brian Williams.

Chuck, this really is hardball. And there`s no interpretation that
comes to me, except to say that the White House said, you know, We want it
to be on the same night. We want the contrast. We want Americans to see
the president`s presentation followed by the individuals on that stage at
the Reagan Library.

How do you read it?

the president -- it was -- it was kind of interesting, when you now look at
the tick-tock of the entire day. The president this morning at the event
with the Chamber of Commerce and the AFL-CIO calling for passage of a
couple of bills, some extensions of a couple bills in order to not harm the
economy, deal with some job issues. He talked about, The political
gamesmanship must end, and then we proceed to have a six-hour back-and-
forth of political gamesmanship here.

Apparently, what happened is when the White House made this request of
Speaker Boehner and Senate Majority Leader Harry Reid, they didn`t sort of
pre-wire this. You know, in Washington normally, there`s -- when some of
this stuff happens, when a president wants to address a joint session --

SMERCONISH: It`s already been determined.

TODD: Yes, it`s a sort of a precooked deal. And from what I
understand, there wasn`t a lot of back-channeling going on between the
Obama White House and the speaker`s office.

What this tells me -- and we can forget about the politics -- we can
talk about the debate in a minute -- but what this tell me is that whole
month of back-and-forth between Boehner and Obama -- and here we are, and
we`re starting the fall season again with the same -- where they`re either
talking past each other, they`re not communicating -- that`s not a good
sign for folks that were hoping that both sides would coming back and
wanting to work together.

SMERCONISH: Well, Chuck, what`s really going on with this Boehner
letter, which I`ve read, because, you know, he talks about how, Hey, we`ll
just be getting back into session, we`ve got to do a security clearance.

TODD: Yes.

SMERCONISH: We need a concurrent resolution. I`m told that it`s the
first time, if this is a rejection of a presidential request -- and that`s
unclear to me exactly what the bottom line is, but to the extent it is a
rejection, it`s the first time in history that there`s been such a

What does Boehner really want?

TODD: Well, I think Boehner`s office would take issue with the idea
they`re rejecting it, that they`re simply saying, Hey, we`re just offering
you another day.

SMERCONISH: But the other day they`re offering is the start of the
NFL season! The NFL season starts on Thursday night!


TODD: There you go. You wonder why that, too -- you know, why didn`t
the White House ask for Tuesday instead of this. I think -- there`s
clearly an issue here, where Boehner`s office was offended that -- since
this letter -- remember, you have to be invited to address a joint session
of Congress by the speaker and the head of the Senate. It`s not something
that the president can dictate in this case. And if you`re asking to be
invited, I think what Boehner`s office is saying, and from what I
understand, is, Hey, why didn`t you let us know before, essentially, you
let the press know over today --

SMERCONISH: Let me -- let me ask --

TODD: Ask us a little bit in advance.

SMERCONISH: Let me ask John Harris. John, where does the debate
stand? Any change in your position as a moderator?

JOHN HARRIS, POLITICO.COM: Well, no, there`s no question there`s
going to be a Republican presidential debate on Wednesday. I think there
is some question as to when the president`s speech is going to take place,
as you note.

My view -- you said this might be hardball by President Obama. That`s
perhaps true, but it`s also, to my mind, a great, big, fat pitch right over
the plate for one of these presidential candidates who`s going to be
debating out at the Ronald Reagan Library on Wednesday.

In all likelihood, the general election will feature one of these
candidates versus President Obama. So in some ways, this sort of counter-
programming, if it happens that way, represents the first general election
debate of the 2012 cycle.

SMERCONISH: John, the three of us -- we`re a couple of junkies. You
know, this is like -- this is like a great news event! Are you kidding me?
We can watch all this happen.

HARRIS: Right.

SMERCONISH: And it would seem to me, John, if you`re moderating this
debate, you know, the first 20 minutes, you`re opening the floor and you`re
saying, OK, respond to what you just heard, and they`re going to have to
think on their feet, which maybe is what the White House had in mind with

HARRIS: I think the White House said, Look, this is a great
opportunity to engage. It`s good for us. But if the Republicans are
thinking with any imagination and they`re confident in their ability to
think on their feet and provide a crisp, compelling alternative message,
it`s a great opportunity for them.

So I see this, if it all happens on Wednesday, one big night,
everybody`s a winner. These Republicans could potentially be a winner.
President Obama gets a higher -- raises the stakes --


HARRIS: -- of this particular evening. And the audience is winners
because they`re going to have a great side-by-side contrast that I say
effectively is the first general election debate of the 2012 cycle.

SMERCONISH: Let me ask Chuck about what the president will actually
say. And Chuck, maybe I shouldn`t read too much into this, but in the
letter that he sent to Speaker Boehner and Majority Leader Reid, he talked
about making a series of, quote, "bipartisan proposals." As a matter of
fact, I think we`ve got the letter now. Here it is. "It is my intention
to lay out a series of bipartisan proposals that the Congress can take
immediately to continue to rebuild the American economy by strengthening
small business," et cetera, et cetera, et cetera.

When he says "bipartisan proposal," do you think this is not the long
ball speech that, for example, Eugene Robinson had written about in "The
Washington Post"?

TODD: It`s my understanding that it`s going to be a lot of ideas of
what the White House is describing as traditionally has been bipartisan.
That doesn`t mean that they can get through this Republican House, but that
in the recent past, has had Republican support, whether it`s spending on
transportation, specific infrastructure, some tax credit issues, but that
it`s a package of that.

By asking to speak before a joint session of Congress -- and my
reporting on this also tells me -- it`s my understanding that this has been
sort of the plan all along, when they decided that they were going to do
this, this is the venue that they wanted because, you know, they feel as if
that this is their last moment to actually get some of this stuff done
before the campaign completely takes over.

That said, I`ve talked to multiple Democrats this afternoon who are
questioning the White House`s play here a little bit on the timing of it,
attempting -- whether it was on purpose or not -- and I think Jay Carney
was trying to say it was a coincidence, but we shall see -- the idea that,
Hey, why elevate the Republican presidential candidates in this way, that -
- you know, John Harris described it as a big slow pitch for one of these
guys, meaning you`re giving them an opportunity to be elevated on the
presidential stage by the president of the United States, and potentially -

SMERCONISH: Well, and how -- how can it --

TODD: -- you`re politicizing -- and let me -- one more thing --
you`re politicizing your own speech in a way that instead of having it
being judged more as a policy speech.

SMERCONISH: That`s exactly what I was about to say. As a matter of
fact, you referenced White House press secretary Jay Carney. Here he is on
the timing of the president`s speech and the GOP debate and whether it was
all a political decision.


were a lot of considerations that -- once you decide you want to do a
speech to Congress and you have to deal with congressional schedules and
other -- there -- there are other -- there are many other factors here.
And obviously, one debate of many that`s on one channel of many was not
enough reason not to have the speech at the time that we decided to have


SMERCONISH: John Harris, Chuck said something -- the point I was
going to make. It seems to me it does politicize the entire meeting. And
another reaction I have is, one wonders about the behavior of the GOP
inside that joint session of Congress because if my memory serves
correctly, it was in one of these similar sessions that you had the Joe
Wilson outburst "You lie," which, you know, many of us thought was entirely
unbecoming of a joint session of Congress.

But isn`t that one of the risks that you run if there is a politicized
type of a speech? Your thoughts?

HARRIS: Well, I have to be clear. I`m all in favor of a politicized
speech, a politicized evening, and having these contrasts out there in very
vivid terms. Chuck had suggested that Speaker Boehner may have been a
little upset by the protocol of this and perhaps some presumptuousness by
the White House. My guess is he`s not the only one. I`d be somewhat
surprised if Nancy Reagan, who obviously is a widely respected figure not
just in Republican circles, wasn`t also a little put off by this news.


HARRIS: Yes. I mean, I don`t know that to be true, but I was struck
by that. My understanding was there was no advance notice or consultation
with the Ronald Reagan Library, as you might ordinarily expect when you`re
dealing with --

SMERCONISH: Hey, John --

HARRIS: -- a former president and a president.

SMERCONISH: -- I don`t want to get -- I don`t want to get in trouble
upstairs or downstairs, but isn`t the likely scenario you just move the
debate back one hour and then we get the best of all worlds?

HARRIS: I`m not really clear on precisely what the logistics will be.
I do know there`s going to be a Republican presidential debate on

SMERCONISH: All right --

HARRIS: I`d be thrilled if that happens the same day as President
Obama`s speech. That seems very much up in the air at that moment.

SMERCONISH: My barcalounger is ready for both.


SMERCONISH: Thank you, Chuck Todd. Thank you, John Harris.

And of course, John will moderate the Republican debate, as he just
said, next Wednesday, alongside Brian Williams. And as of now, the debate
is scheduled for next Wednesday right here on MSNBC at 8:00 o`clock.

Coming up: The sudden rise of Rick Perry. He`s not your father`s
Republican. What`s more, he could win, and that has a lot of progressives
very nervous.

You`re watching HARDBALL, only on MSNBC.


SMERCONISH: With Rick Perry running strong in the Republican field,
some Tea Party types are running away from former front-runner Mitt Romney.
The Tea Party-affiliated group FreedomWorks is planning to protest a Tea
Party event this weekend in New Hampshire because Romney`s attending. An
FreedomWorks organizer said, "We have to defend our brand against posers"
and other Tea Party activists say Romney doesn`t represent their interests.

We`ll be right back.



With his Texas swagger and hard-core conservative views, many liberals
have called Governor Rick Perry "George W. Bush on steroids." But is the
growing possibility of one day having to call him "Mr. President" scaring
liberals into finally getting worked up about the 2012 campaign?

According to Politico, "Perry panic has spread from the conference
rooms of Washington, D.C., to the coffee shops of Brooklyn, with the
realization that the conservative Texan could conceivably become the 45th
president of the United States, a wave of alarm centering around Perry`s
drawling, small-town affect and stands on core cultural issues, such as
women`s rights, gun issues, the death penalty and the separation of church
and state."

Beyond cultural issues, the governor has called the 16th Amendment,
which authorized the federal income tax, quote, "the great milestone on the
road to serfdom." He`s called Social Security "a Ponzi scheme" and has
suggested Supreme Court decisions should be able to be overturned with a
two thirds vote in the Congress. These are not exactly views that fall
within the mainstream of American politicos, even for Republicans.

Here to discuss all this is "Washington Post" columnist Dana Milbank
and Politico`s Jonathan Martin. Jonathan, is it what he says? Is it what
he has done a governor? Is it some combination of both?

JONATHAN MARTIN, POLITICO.COM: I think it`s those two things and I
think it`s how he says it and how he looks when he`s saying it. A lot of
American politics is cultural. And issues, of course, matter. And I think
that that`s definitely driving part of this. But you can`t discount the
cultural issue.

You know, George W. Bush was somebody who, as Dana well knows, spent
part of his life in west Texas, but also went to prep school at Andover,
went to college at Yale, grad school at Harvard. So -- he came from,
obviously, a very prominent political family in the Northeast. So he was
somebody who I think liberals sort of didn`t like, clearly, but the
cultural thing was not as pronounced as with Perry.

Perry is the genuine article. What he says, that he couldn`t tell you
where Martha`s Vineyard is, he means it, and he doesn`t care that people
don`t like that. That`s not his world. His world is Texas A&M. It`s, you
know, growing up on a cotton farm in west Texas. It`s the Boy Scouts. And
he`s unapologetic about it.

So I think if you have an Obama/Perry matchup, that could really be a
serious cultural clash, you know, urban versus rural, liberal versus

SMERCONISH: Hey, Dana, let`s show everybody something that you wrote
on exactly this issue, meaning Rick Perry. You said that, "By his own
account, he`s a cultural warrior seeking to save marriage, Christmas and
the Boy Scouts from liberals, gay people and moral relativism. Perry`s
politics are religious in a way not seen before in modern-day mainstream
presidential politics."

Really? I know you`ve recently read both the books that he has

DANA MILBANK, "WASHINGTON POST": Right. While everybody else was
reading Dick Cheney`s attacks on Colin Powell, I was reading Rick Perry`s
attacks on gay scoutmasters. But I think that`s true. I mean, you know,
we -- Probably William Jennings Bryan might have held even with Rick Perry
in terms of how he`s expressing his faith.

But he does not seem to have the soft edges that Bush has. I mean,
it`s kind of funny to think of George W. Bush as having soft edges, but
it`s almost like Rick Perry is Bush without the charm. And he does, I
think, alarm a lot of people, as Jonathan was pointing out, because of the
way that he phrases things.

You don`t hear a president typically speaking in terms of Jesus Christ
needing to be the savior for all of the people, not just some. He says
it`s not acceptable to say that Jesus was just a good man and a good
teacher because --

SMERCONISH: Well, can I put something on the screen on that issue and
allow you to continue? Because here`s what Rick Perry wrote in 2008 about
Christianity and secularism. "Either faith in Christ can cleanse all
people of their sin or none, but not some. Many, especially secular
humanists, want to recognize Jesus as a good teacher but nothing more. But
why call him good if he has lied about his claims of deity and misled two
millennia of followers. I believe secular humanism emanates out of man`s
great downfall, the sin of pride."

I got to tell you something. I recognize what you`re saying about how
that would drive liberals bat-blank, but I`m sure it`s a huge applause line
when it comes to the world of Republican primaries.

MILBANK: Well, it certainly is, and I think that`s why we`re seeing
him rise so very rapidly in the polls. And he says other things -- you
know, sort of equating homosexuality to alcoholism, as he did in that book,
as well. Typically, in a normal year, you`d say, Look, this guy is outside
of the mainstream. Democrats would salivate to have a guy like this to run
against because they think it would be easy to run against a guy like this.

The problem is, because of the way the economy is, because President
Obama is in such a vulnerable position --


MILBANK: -- you could actually get to the point where even the guy who
is outside of the mainstream, should he get the nomination, could actually
be in a position to become the president.

SMERCONISH: Jonathan, allow me to show you and everyone else
something else that Governor Perry wrote in a book. This was in 2008.

And -- and Dana just made reference to this, when he compared gay
people to alcoholics and he wrote: "Even if an alcoholic is powerless over
alcohol once it enters his body, he still makes a choice to drink. And
even if someone who is attracted to person of the same sex, he or she will
make a choice to engage in sexual activity with someone of the same

MARTIN: Right.

SMERCONISH: Here`s my question for you.

Is this the sort of thing that you could see Mitt Romney, who is now
duking it out with Perry for leadership of the GOP, using --


SMERCONISH: -- in Primary season, or would he not go that route?

MARTIN: It`s a great question.

I don`t think Romney would use that kind of language against Perry,
because frankly that would just remind a lot of primary voters about
Romney`s own more moderate path when he was running in a very liberal

I think Romney`s message is going to be much more oriented towards
Perry having been in public office since 1985, being a sort of, you know, a
government lifer, if you will, at a time of maximum wariness among
conservatives towards those who work in government.

Michael, what I`m really curious about is what Perry is going to say
in these debates in this next month. We have three of course coming up
here in September, the first one sponsored by Politico and NBC at the
Reagan Library.

Is Perry going to stick to a pure jobs and economic message, or will
he be pushed into talking about some of these cultural matters? He`s been
fairly disciplined out of the gates here. Obviously the whole Ben Bernanke
was a slip-up, but it`s going to be I think a real test of his. Will he
veer more to the cultural wars or is he going to sort of stick more to the
jobs and economic focus?

We will get a sense, I think, of their strategy, the Perry folks, in
this next couple of weeks.


SMERCONISH: Well, let me pursue that with Dana, if I may, for just a

MARTIN: Please. Please.

SMERCONISH: Because we just had a great conversation here about the
dynamics of next Wednesday night, where perhaps it`s the president speaking
to a joint session of Congress, immediately followed by the debate at the
Reagan Library right here on MSNBC.

Dana, from having just read those two books and of what you know about
Rick Perry, is he capable and able to immediately think on his feet and
respond to the president after the president concludes his remarks?
Because I think that will be a wild card in the debate next Wednesday night
if this is the way it goes down?

MILBANK: Well, as Jonathan`s publication has been raising the
question I think in a very provocative way, there are questions about Rick
Perry`s intelligence, the ability to speak on his feet.

Look, if you`re a dumb guy, you don`t get as far as he did in

MARTIN: Right.

MILBANK: I think he is very good with the one-liner, and I think he
will have the ability to react to that.

Unclear what happens in a more extended debate with the president.
You know, in these large Republican field presidential debates, everybody
only gets a couple minutes anyway. He can probably hold his own in that
sort of position. And certainly nobody is going to come out and try to
make a big deal in a Republican debate about some of his more provocative
socially conservative views, because most of them hold the same ones.

SMERCONISH: Well, Jon Huntsman could. If Jon Huntsman wanted to
emerge from the pack, if I were whispering in his ear, I would tell him to
go for broke next Wednesday night on exactly that basis.


SMERCONISH: Hey, Jonathan, one other aspect of this, if I may --


SMERCONISH: -- because we`re talking about these so-called extremist
positions of Rick Perry.

To me it always come back to how does it play with the I`s? How does
it play with the independents?


SMERCONISH: Because it might not caught any problems in primary
season, but this is exactly the sort of thing that I think could cost him a
general election.

MARTIN: Right.

And that`s the whispering that you hear talking to very influential
folks in the Republican Party. And that is, OK, Perry`s got what it takes
to win a primary. But how is he going to fare in a general election,
Michael, in places like Montgomery County, Pennsylvania, your backyard,
suburban Philadelphia, suburban Columbus, Ohio, et cetera, et cetera?

I think he`s got to figure out how he answers that question. I
actually asked him that question at the Iowa State Fair. You were just
showing B-roll I think of the state fair a couple weeks ago. I said, how
do you respond to that rap, Governor? And he said, they care about jobs in
Ohio and Pennsylvania as well.


SMERCONISH: Well, it depends on the state of the economy.

MARTIN: It depends on the economy.


MARTIN: But culture matters, too. Culture matters, too.

SMERCONISH: We care about social issues as well, I can tell you.

Hey, thank you, Dana Milbank. Thank you, Jonathan Martin.

MILBANK: Thanks a lot.

MARTIN: Thank you, Michael.

SMERCONISH: Up next, besides Sarah Palin, there`s another Republican
who says he`s still not made up his mind as to whether to run for
president, Rudy Giuliani. What Rudy Giuliani is thinking next on the

You`re watching HARDBALL, only on MSNBC.


SMERCONISH: Welcome back to HARDBALL. Time now for the "Sideshow."

First up, OK, this time it`s for real, again. Former New York City
Mayor Rudy Giuliani is now seriously considering entering the 2012 race.
At least he`s kind of set a time frame for when he might make an
announcement. According to the Associated Press, Giuliani said he wouldn`t
make a final decision until well after the 10th anniversary of the 9/11
attacks, probably the end of September.

Talk about vague. What will sway Giuliani one way or the other? He
said, "Part of it will be how the other candidates perform and whether I
have confidence one of them can beat President Obama. I`m not sure of it

Time is running out, Mr. Mayor. Tomorrow is September the 1st.

And next up, joining the Bushies in Perry bashing? Well, not quite.
Former Vice President Dick Cheney has been front and center this week with
the release of his new tell-all memoir.

In an interview on FOX this morning, the conversation inevitably
turned to the 2012 election and the hype surrounding Rick Perry. Rather
than comment on the candidate himself, Cheney commented on how Perry might
have his Texas roots to thank. Let`s listen.


busy looking back at old elections doing the book, rather than focusing on

I was always struck by the extent to which the rest of the country is
attracted to Texas and Texas politicians. But there`s just a different
feel to it. It`s the West. There`s a strong sense of independence, and a
little bit of arrogance, maybe.


SMERCONISH: Too busy thinking about past elections? Maybe, but it
seems more like he`s chosen to take a backseat for now, not exercising his
own Texan independence, I guess.

And now for the "Big Number." What`s with the negativity? In the
lead-up to the recent recall election in Wisconsin, it appears that
candidates` ads were largely designed to attack opponents -- $12 million
was spent on ads aired in the major TV market in the three months leading
up to the recall. Just how many ads were purely negative?

Ninety-five percent. The study also shows that a large majority of
the spending was done by special interest groups and not the candidates
themselves. Ninety-five percent, that`s tonight`s "Big Number."

Up next, how is this for hypocrisy? Congressman Eric Cantor insists
any money spent on hurricane cleanup to be offset by other spending cuts.
But, of course, that wasn`t his opinion when a tropical storm hit his
district a few years back.
You`re watching HARDBALL, only on MSNBC.


BRAD GOODE, CNBC CORRESPONDENT: I`m Brad Goode with your CNBC "Market

An upbeat end to an August most investors would just like to forget.
The Dow Jones industrials climbing 53 points, now back in positive
territory for the year. The S&P 500 added six, and the Nasdaq tacked on
three points.

It was the worst August for stocks in a decade, with all the major
indices tumbling between 4 and 6 percent. Banks got the worst of it,
especially some of the regionals, but today it was AT&T slumping after the
Justice Department moved to block its takeover the T-Mobile, the Department
of Justice saying the $39 billion merger would be bad for consumers. But
cell phone tower companies gained because if AT&T can`t use T-Mobile`s
towers, it`s going to have to build more of its own.

Ford and short-term rental car company Zipcar advanced on word they
are teaming up to supply ZipcarS on 250 college campuses.

And Amazon surged on a report it will launch its new Android-powered
tablet to take on the iPad come October.

That`s it from CNBC, first in business worldwide -- now back to


Last weekend, millions of Americans up and down the East Coast were
slammed by Hurricane Irene. People lost their homes, their businesses and
several dozen people lost their lives. Now Republicans like House Majority
Leader Eric Cantor are threatening to withhold federal relief funds unless
they`re offset by cuts.

Are Republicans really going to keep the green eyeshades on while
thousands are suffering?

Joining me now are MSNBC political analysts David Corn of Mother Jones
and Michael Steele, a former chairman of the Republican National Committee.

Allow me to show you both what Congressman Cantor had to say on this
issue Monday morning.


appropriate instance where there`s a federal government role. Those monies
are not unlimited. And what we have always said is we have offset that
which has already been funded.

Just like any family would operate when it`s struck with disaster. It
finds the money it needs to, to take care of a sick loved one or what have
you, and then goes without trying to buy a new car or put an addition onto
the house.


SMERCONISH: Michael Steele, is he speaking for the GOP or speaking
for himself?


think he`s speaking for the GOP, and I think he`s speaking for the country
and the concerns that a lot of citizens have about the money.

Look, the bottom line is, those states, particularly here on the East
Coast that have been ravaged by this storm, will get the aid they need,
they will get the resources that they need on the ground. I think what the
leader was talking about was making sure that we don`t do as Washington has
done in the past, and that is just spend without some understanding and
appreciation that this is a limited coffer, those resources are not readily
available, and, yes, we`re going to have to do some offsets, maybe some in
FEMA, maybe some in other departments, to make sure that all those
resources are there and available.

SMERCONISH: David, he might find himself in an awkward position on
this issue because of a request that he made for aid after Tropical Storm
Gaston back in 2004.


SMERCONISH: I saw a "Hill" report today which said: "In a letter to
then-Secretary of Homeland Security Tom Ridge, Cantor requested immediate
action from Washington. `Time is of the essence,` Cantor wrote. The
federal assistance to Richmond after Gaston ultimately totaled nearly $20
million, according to the Virginia Department of Emergency Management.
There was no mention of deficit spending concerns."

CORN: Now, I know, Michael, that you`re not surprised that Eric
Cantor or any other politician is preaching what they didn`t practice at
the same time.

STEELE: Of course.


CORN: The way I look at this, if you`re a hammer, every problem look
like a nail. And if you`re a hostage taker, every issue looks like a

So while Americans are suffering because of these natural disasters,
Eric Cantor is running in on his ideological platform and saying, aha, I
see another way to take a hostage and say we must have spending cuts.

I don`t think this will be a winning issue for him over the long run.
I would bet it will fade in the weeks to come, particularly if we start
running dry on some of that FEMA emergency money.


SMERCONISH: Michael, the optics of this potentially are pretty bad
from a political standpoint.

STEELE: Right. Right.

SMERCONISH: Respond to that.

STEELE: No, and that`s the rub.

And I appreciate the drama that my friend David has kind of put out
there, but the reality of it is, it`s much more what you have just said
here, Michael.


STEELE: It is the optics here. The optics are off. I think the way
you should have started this conversation is, you know, showing the empathy
for the people out there, affirming very clearly that the resources are
going to be made available to help them.

But, you know, you can also then recognize, yes, we`re in tight times,
but we`re going to make it work. We don`t need to get into the Washington
minutia of where the money is going to come from or how we`re going to pay
for it. That`s not what people want to hear when they have just lost their
home or the life of a loved one.

So, I think the optics here are really off. Hopefully, over the next
week, that will self-correct, as the dollars start to flow that need to be
out there in the public. But I agree with you, the optics don`t look good.

CORN: Yes.

SMERCONISH: I`m just thinking down the road. One of the states that
really got rocked was the Garden State of New Jersey.

And I can see a scenario -- and Chris Christie is a practitioner of
fiscal restraint, but I can see a scenario where the GOP House could be at
odds with one of their prized governors, meaning Christie.

CORN: You already have, Michael, Republicans in Missouri who feel
like the money that`s going to go to Irene might come from efforts to deal
with the tornadoes in Joplin and elsewhere who are complaining now, too.

STEELE: Right.

CORN: Ultimate, the Republicans -- I don`t think the Republicans
overall are in a good spot right now. I don`t think the president is

After the debt ceiling, the numbers went down for each side, and the
Republicans looked like they were willing to blow things up to get their
ideological way. And I think for Eric Cantor to come out after these
disasters and say, aha, we have another way of playing this same game, is
not going to help him with independent voters or people in those states who
may need assistance.

SMERCONISH: Well, David --

CORN: Let me say, Michael Steele is exactly right. This is not the
first thing that should come out of his mouth when people are still picking
up the pieces.

SMERCONISH: Let me be fair to Congressman Cantor by sharing with you
what his spokesman, Brad Dayspring, said.


SMERCONISH: He went on the defense when asked about Cantor`s
requesting aid back in `04, which I made reference to. He told the
"Huffington Post`s" Sam Stein, quote, "The national debt was at the time
under $8 trillion and was $8.67 trillion when Nancy Pelosi became speaker.
Today, the debt stands at $14.625 -- meaning that while Democrats
controlled the purse string, the national debt literally exploded. We`re
living in different times."

And so, Michael Steele, his point is -- you can ask for offsets today
in 2011 because we find ourselves in dire straits.

STEELE: Well, that`s true, but this is where a lot of the rank-and-
file Republicans have a little bit of rub because back in the day, we
didn`t have the money to spend, either. We were increasing the deficit. I
mean -- remember, in 2001, it was -- we had a balanced budget. By 2008, we

And that`s part of the argument that a lot -- that resonates with a
lot more people in this country than I think some in our party really want
to get their heads around.

So, you know, again, getting back to the optics -- not good. I think
the reality for the speaker and the leadership with Cantor is you`re going
to make it work, because people need help. And you will work out with the
White House and others in Congress how you go about giving the dollars into
that FEMA coffer to make sure those resources are there, even if it starts
with various programs in FEMA, which I think David would agree not all of
them have worked over the years, could use some tinkering.

SMERCONISH: David Corn, here`s what FEMA director, Craig Fugate, had
to say about Republicans potentially blocking disaster relief. This was on
the "Today Show" just this morning.


CRAIG FUGATE, FEMA ADMINISTRATOR: We look at these large-scale
disasters as something that`s hard to budget for. This is a question that
best left to the appropriators and to those that deal with these issues.
In this country, Americans have always come to the aid of other Americans
in a crisis and disaster. That`s our job, that`s we do, that`s who we are.
FEMA is doing its job.


SMERCONISH: I think, thus far, getting high marks generally across
the country, and it will be hard if you`re in a political posture, contrary
to that man at this time.

CORN: Listen, I`ll take the head of the FEMA agency and Obama
administration over a Republican politician any day in that fight.
Compared to what FEMA did in the Katrina days and to the Bush years, right
now, I think Craig Fugate has given FEMA a whole new light and is widely
seen as doing a good job.

So, he`s sticking to the issue and he`s, you know, kind of staying
above the political fray. If Eric Cantor insists on making this a
political issue, it will hurt him and the Republicans.

SMERCONISH: In your prior job, Michael Steele, you would have been
calling him, saying, hey, you`re killing me, you`re killing me in the next


STEELE: Yes. Like, can you help a brother out here? Come on now.

No, I think -- I think David makes a very good point, and I think they
understand how this has come off and how this looks to the American people.
As I said, I really believe -- I know Eric very well. He`s going to get it
right on this. And I don`t think he`s going to politicize than it already

SMERCONISH: Thank you both. Thank you, David Corn. Thank you,
Michael Steele.

CORN: Sure thing.

SMERCONISH: Appreciate your time.

Up next, here`s a headline that won`t play well in an era of record
deficits. A congressional commission reports that $60 billion has been
wasted in the Iraq and Afghanistan wars. And even worse, taxpayers`
dollars are actually funding the enemy. That`s ahead.

This is HARDBALL, only on MSNBC.


SMERCONISH: America`s most famous military man has worn his uniform
for the last time. General David Petraeus officially retired today after
37 years in the Army. Petraeus oversaw the successful surge in Iraq and he
was the top commander of U.S. forces in Afghanistan as well. In his
farewell speech at the Pentagon today, Petraeus argued against cutting
defense spending too deeply, saying that it would undermine the military`s
flexibility and versatility. Petraeus takes over as director of the CIA
next week.

We`ll be right back.


SMERCONISH: Welcome back to HARDBALL. There`s a mind-boggling report
out today on just how much taxpayer money has been lost to waste and fraud
for work done by contractors in Afghanistan and Iraq. The Commission of
Wartime Contracting found up to $60 billion has been wasted over the past
10 years and the commission calls that a conservative estimate, and there
could be more waste to come when the U.S. withdraws from these war zones if
we need to foot the bill for upkeep of the infrastructure upgrades that we
have put in place.

Today, Senator Claire McCaskill, who called for this commission, along
with Senator Jim Webb, said in a statement, "It`s disgusting to think that
nearly a third of the billions and billions we spent on contracting was
wasted or used for fraud."

Richard Lardner is a reporter with the "Associated Press`"
investigative team. He broke the story for the "A.P." when he got an
advance copy of the report.

Richard, I expect something is going to fall off the truck and
allowing for economies of scale. Unfortunately, there`s going to be waste,
fraud and abuse, but this is far in excess of what any reasonable estimate
would seem to have expected.

RICHARD LARDNER, ASSOCIATED PRESS: Yes. I think that $60 billion
figure, and again, that`s the upper end of a scale that begins at $31
billion and moves up to $60 billion. You know, it`s not totally precise,
but the commission seems to think $60 billion is not unreasonable at all.

And it is a very, very large figure, especially when you consider the
number it comes from. That $60 billion out of $206 billion total spend on
contracting and grants in Iraq and Afghanistan. So, that`s about 30
percent of the total that has been lost to waste and fraud.

SMERCONISH: When I saw your headline -- of course, the first thing I
wanted to know was, OK, are these toilet seats, paper clips? What are we
talking about?

Here`s an excerpt from your article: "The commission cited numerous
examples of waste, including a $360 million U.S.-financed agricultural
developmental program in Afghanistan. The effort began as a $60 million
project in 2009 to distribute vouchers for wheat, seed and fertilizers in
drought-stricken areas of northern Afghanistan. The program expanded into
the south and east. And soon, the U.S. was spending $1 million a delay on
the program, creating an environment ripe for waste and abuse, so said the

I also read in part of your report we were assisting people doing
something that frankly they were capable of doing themselves in this

LARDNER: Right. Again, that again is an example. And there`s
numerous examples in the report of projects that start off well-
intentioned, they seem to make sense. And in the end, they don`t. And
they end up wasting money.

In Afghanistan, particularly, you have a problem with a country that
doesn`t have basic infrastructure. That we take for granted technical,
bureaucratic. And when you start injecting huge amounts of money into that
country, you create an environment for waste. And that`s what happened
here and there are many other examples in the commission`s report.

SMERCONISH: Well, here`s another, because I think what we are about
to is the worst of it, we`re funding the enemy.

You say, quote, "The Afghan insurgency`s second large et funding
source, the insurgency now, after illegal drugs is the diversion of money
from U.S.-backed construction projects and transportation contracts.
That`s according to the commission. The money typically is lost when
insurgents and warlords threaten Afghan subcontractors with violence unless
they pay for protection, according to the report."

So, those funds for good work that we`re trying to have done in that
country are ending up funding those fighting against us.

LARDNER: That`s what the commission says. And now, it`s important to
note that the commission does not put a number, a dollar figure, on how
much is being diverted to insurgents, to criminals. And the military will
tell you that it`s a very small business.

A task force in Afghanistan that was set up by General David Petraeus
before he left looked at about 2,000 active contracts and concluded, worth
about $31 billion, and concluded that about $360 million had fallen into
the wrong hands, that included power brokers, that included criminal
networks and included insurgents.

They won`t say how much of that $360 million wound up in insurgent
hands, but they say it`s a very small percentage.

SMERCONISH: And then I have the words of Secretary Powell ringing in
my head because of the old pottery line, if you break it, you own it. The
worst might yet be to come because as you point out, we have funded so much
more repair and construction of infrastructure that needs to be maintained.

So, if we all of a sudden pull up stakes, what becomes of the
investment that we make?

LARDNER: Again, that`s a big potential problem. And especially again
in Afghanistan where they just -- they lack the fiscal resources and the
technological capacity to maintain a lot of what has been built. So, what
the commission describes is a situation where a power plants have been
built, roads have been built, dams have been built, and a lot of necessary
infrastructure we leave or our allies leave and the Afghans can`t support
it, it falls into disrepair and the investment is lost.

SMERCONISH: Do I understand -- we have just a minute left -- that the
commission itself will soon go out of existence or has already done so? In
other words, what becomes of this oversight role?

LARDNER: They only had a three-year window. They were formed in
2008. They officially go out of business at the end of September. This is
their final report.

So, that represents three years of work. There are 15 recommendations
in it, which range from creating a permanent inspector-general to oversee
what they call contingency operations. These are sort of emergency
situations with the war zone or a Katrina-like situation.

So, presumably that new I.G., if it`s ever implemented, would kind of
fulfill the role that they have been doing for the last three years.

SMERCONISH: Understood. A frightening report, unemployment is 9
percent or even if it were zero percent. Thank you, Richard Lardner.

When we return --

LARDNER: Thank you for having me.

SMERCONISH: Thank you.

Let me finish with why a tough new anti-bullying law might actually go
too far. You`re watching HARDBALL, only on MSNBC.


SMERCONISH: Tomorrow in New Jersey, the strongest law in the nation
regarding bullying goes into effect. Within one day of a bullying
incident, principals must begin an investigation, and twice a year,
superintendents must be reports to Trenton detailing all episodes.

Getting lots of attention is that one district, East Hanover, crime
stoppers will accept anonymous text messages, calls or tips about bullying
to their Web site and then they`ll forward the information to both school
and local police officials.

Richard Bozza, the executive director of the New Jersey Association of
School Administrators, told "New York Times,` "I think this has gone well
overboard." Some educators say they were given no resources to implement
18 pages of requirements.

The law was inspired by the suicide of a Rutgers freshman last
September. That was the case where 18-year-old Tyler Clemente, a freshman,
took his life by jumping off of the George Washington Bridge. His
roommate, Dharun Ravi, stands charge with invasion of privacy and
intimidation as a bias crime based on Clemente`s sexuality. He faces up to
10 years in jail if convicted.

The widely circulated version of the story after the incident was that
Ravi and a female student, with malice, on more than one occasion, used a
webcam to spy on Clemente while he was in an intimate encounter with
another man. And that such was Clemente`s embarrassment upon learning of
the privacy invasion that he took his own life.

The prosecution narrative asserts that Ravi sought to expose
Clemente`s sexual orientation to humiliate and intimidate him. But
hundreds of pages of documents filed in court by the defense suggest a more
complicated picture, although none of which will change the tragic outcome.
The defense document suggests that there was no sexual encounter, much less
any recording of a sexual encounter, that Clemente may have been depressed
before he arrived at Rutgers. And part of the reason for his depression
may have been his own mother`s reaction to his sexual identity and that his
roommate Ravi had said in one online exchange that he really didn`t care
about Clemente`s orientation.

For his part, Clemente apparently commented on Ravi`s ethnicity,
speculating his parents owned the Dunkin` Donuts.

Also, the defense maintains that at the time, Clemente was taking his
life, Ravi was apologizing for his own behavior.

Look, bullying is a bad thing that should be confronted at every
opportunity. And bias based on sexuality is similarly abhorrent and needs
to be prosecuted to the fullest extent of the law.

But what went on in Davidson Hall at Rutgers last fall may have been
neither of those. Instead, it may have been a case of students behaving
badly, a gross invasion of privacy, motivated by the prurient interest of
sex regardless of whether it involved men with men or men with women.

And if that`s the case, the lesson for educators in New Jersey might
be that not all student misbehavior is bullying.

You can follow me on Twitter if you can spell Smerconish.

That`s HARDBALL for now. Thanks for being with us.

"POLITICS NATION" with Al Sharpton starts right now.



Copyright 2011 CQ-Roll Call, Inc. All materials herein are protected by
United States copyright law and may not be reproduced, distributed,
transmitted, displayed, published or broadcast without the prior written
permission of CQ-Roll Call. You may not alter or remove any trademark,
copyright or other notice from copies of the content.>