'The Last Word with Lawrence O'Donnell' for Monday, July 9, 2012

Guests: Nick Hanauer, Rep. Debbie Wasserman Schultz, Jonathan Turley

LAWRENCE O`DONNELL, HOST: When is it good for a Democratic
presidential candidate to talk about income taxes? Never. Except when the
Republican candidate has Swiss bank accounts, parks hundreds of millions of
dollars offshore and pays less than the lowest income tax bracket.


tax cuts for the wealthiest Americans to expire.

CHUCK TODD, NBC NEWS: Ready for another bruising showdown about tax

MICHAEL SMERCONISH: Tax bracketology.

OBAMA: We don`t need more top-down economics.

UNIDENTIFIED MALE: The battle over the Bush tax cuts is back.



TODD: Tax cuts for the wealthy.

OBAMA: I`m not proposing anything radical here.

SMERCONISH: Mr. Obama called for extending the Bush tax cuts.

UNIDENTIFIED MALE: Calling for a one-year extension.

SMERCONISH: For people making less than $250,000.

UNIDENTIFIED MALE: Less than $250,000 a year.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: That would be another kick
in the gut to the middle class in America.

MARTIN BASHIR, MSNBC HOST: If you say so, Mr. Romney.

OBAMA: We`ve tried it their way. It didn`t work.

ROMNEY: I think it`s about envy. I think it`s class warfare.

UNIDENTIFIED MALE: It`s not class warfare. It`s math.

UNIDENTIFIED MALE: This is gearing up to be an election year battle.

SMERCONISH: The fight for the middle class is on.

TODD: Democrats launched a coordinated assault.

TAMRON HALL, MSNBC ANCHOR: All-out assault on Mitt Romney`s refusal
to release more tax returns.

UNIDENTIFIED MALE: Everybody is going to be talking about Switzerland
and the Cayman Islands and Bermuda.

ROBERT GIBBS, OBAMA CAMPAIGN: He has a shell corporation in Bermuda.


GIBBS: Investments in the Caymans.

SCHULTZ: Investments in the Caymans.

GIBBS: He`s had a bank account in Switzerland.

UNIDENTIFIED MALE: I`ve never known of a Swiss bank account to build
an American bridge.

UNIDENTIFIED MALE: He`s disconnected. That`s the problem.

UNIDENTIFIED MALE: Wealthy and out of touch.

JANSING: Mitt Romney`s worse nightmare of an image.

UNIDENTIFIED MALE: If the Bain attacks were working, these attacks
will work.

CONAN O`BRIEN, COMEDIAN: Mitt Romney said he`s worn a garbage bag as
rain gear. He had to dump out the hundred dollar bills and throw the bag
over his head.


O`DONNELL: A hundred and seventy-six days from now, your income taxes
are going up. It`s already written into law. If Congress does absolutely
nothing, current income tax rates will expire on New Year`s Eve, and on
January 1st, income taxes will automatically go up. It will be a huge tax

On January 1st, everyone except those currently in the 15 percent
bracket will see their income taxes go up. The biggest income tax increase
will actually hit the lowest bracket, the lowest income earners. Those in
the 10 percent bracket will see their rates go up 50 percent.

By comparison, all of those in the top income tax bracket will see
their rates go up only 13 percent. And no one, no one in Congress or the
White House wants to see all of this happen. But President Obama does want
to see this happen. He wants to see the top two brackets go up, but only
the top two.

He wants to prevent all the other brackets from going up. In order to
stop all of this from happening, 176 days from now, Congress has to pass a
bill preventing it from happening. The Republicans want to pass a bill
preventing all of this from happening, and the Democrats and the president
want to pass a bill preventing most of this from happening, but allowing
the top two rates to go up.

Now, if any of you spent your Fourth of July holiday doing your
Christmas shopping and your friends told you you`re crazy, you should
listen to your friends. You have plenty of time for Christmas shopping.
You have 169 shopping days left until Christmas.

But if you`re Congress and you`ve got 176 legislative shopping days
left to pass the biggest tax legislation in years, then you better get to
work on it right now.

Don`t wait until the last minute as we approach this fiscal cliff.

You`re going to be hearing that phrase a lot, a fiscal cliff between
now and January 1st because in addition to the tax increase scheduled for
January 1st, there is also a large cut, 500 billion in defense spending
scheduled to go into law on January 1st.

The combination of big government spending cuts and a big tax increase
is the fiscal cliff that many economists fear would be such a negative jolt
to the economy that would slow down our economic recovery.

So neither party, Democrat or Republican, wants to go off the fiscal
cliff on January 1st. To avoid the fiscal cliff, not only do they have to
write a new tax bill, but they have to write a new defense spending bill
and pass them both before January 1st. And they have only 176 legislative
shopping days to do it.

So if you want Congress to do something before January 1st and you
start talking about it right now, you would not be jumping the gun. You
would not be doing your Christmas shopping in July.

If you need Congress to do something by New Year`s Eve, don`t start
talking to them in December. You start talking to them today -- and that`s
what the president did today in the East Room of the White House.


OBAMA: I`m not proposing anything radical here. I just believe that
anybody making over $250,000 a year should go back to the income tax rates
we were paying under Bill Clinton back when our economy created nearly 23
million new jobs, the biggest surplus in history, and plenty of
millionaires to boot.


O`DONNELL: The president urged Congress to take action on what they
can agree on, which is all of these tax rates except for the top tax rates,
and leave what they disagree on to be dealt with after the election.


OBAMA: In many ways, the fate of the tax cut for the wealthiest
Americans will be decided by the outcome of the next election. My opponent
will fight to keep them in place. I will fight to end them.


O`DONNELL: In other words, the president is saying, let`s pass a bill
preserving all of the tax rates we agree on, and let`s let the voters
decide on what to do with the top tax rates, re-elect President Obama and
the rates go up slightly, only a few percentage points. Elect Mitt Romney
and let him do a day one tax cut for the high income earners.

Now, Mitt Romney, of course, hates that idea. The sensible,
reasonable business that he is doesn`t want to reach an agreement on
everything they already agree on, which is most of the tax rates. He
doesn`t want to reach an agreement with the president on everything they
agree on.

He wants to keep fight over all the tax rates together. And
Republicans agree with him on this because they know if they pass a bill on
the tax rates that they agree with the president on, which is most of them,
then everyone will be able it to see that the real fight is over nothing
but lowering the top tax rates a few points.

That`s all Republicans really care about. But Mitt Romney knows he
can`t go out there and say, look, we shouldn`t make a deal on doing what we
agree on, because that would expose the fact that we really only care about
the top income tax rates. So, instead of saying that, his handlers gave
him this to say.


ROMNEY: What the president is proposing is therefore a massive tax
increase on job creators and on small business. Small businesses are
overwhelmingly being taxed not at a corporate rate but at the individual
tax rate. So successful small businesses will see their taxes go up
dramatically, and that will kill jobs.


O`DONNELL: And with the Obama campaign trying to turn this week into
tax week in the campaign, it seems like the perfect time to remind American
voters that no matter what Congress does with income tax rates, Mitt Romney
will still pay less than the lowest income tax rate.


GIBBS: The next president in the next four years, somebody has to
tackle comprehensive tax reform, and they have to deal with sheltering
income like it appears Mitt Romney is doing in Bermuda, in the Caymans, in

When I pick a bank, I pick one near my house because there`s an ATM I
can get cash out of it. I don`t think you`re picking a bank in Switzerland
because there`s an ATM near your house.


O`DONNELL: Joining me now are co-hosts of MSNBC`s "THE CYCLE,"
Krystal Ball and Steve Kornacki.

Krystal, the idea that you would get an anti-tax candidate running
with a Swiss bank account, with money in the Cayman Islands, with all --
it`s never been this convenient for the Democrats. It`s always been a very
awkward subject for the Democratic candidate who is trying to be more
responsible on taxation. Romney makes this a sweet spot for the Obama

KRYSTAL BALL, CO-HOST, `THE CYCLE": It`s beautiful. And then when
you add to that the Hamptons fund-raisers this weekend and all of the
wonderful quotes that came out of that and you ask the American people, OK,
do you really want to finance a tax cut for these people? I think the
answer becomes very clear.

And the response that, oh, we need comprehensive tax reform, I mean,
he just has in the Republican Party has absolutely no credibility on
seriously wanting comprehensive tax reform. Do we really want to trust the
guy who`s got his money parked in the Cayman Islands to close tax loopholes
for us? That doesn`t just make a whole lot of sense to me.

O`DONNELL: Let`s listen to what Mitch McConnell said about the way he
thinks this tax situation should be handled.


cliff coming at the end of the year. What we ought to be doing is extend
the current tax rates for another year with a hard requirement to get
through comprehensive tax reform one more time.


O`DONNELL: Oddly enough, Steve, he wants to do exactly what he`s
proposed doing in the past, which is why don`t we just extend the current
tax rates, otherwise known as the Bush tax cuts.

STEVE KORNACKI, CO-HOST, "THE CYCLE": Right. And then when
comprehensive tax reform drags out or hits a dead end, we say, oh, no, we
can`t let these things expire.

But I think it`s worth putting in perspective. I mean, you worked
(ph) in the Senate Finance Committee, you understand this. What Obama is
trying to pull off here, it`s been 22 years, 1990 since a single Republican
in the House or Senate signed off on an income tax increase. The last time
it happened was 1990 and it caused a rebellion in the Republican Party and
it led to Pat Buchanan challenging George Bush in 1992 and it led to Newt
Gingrich`s rise and all these things.

And so, we`re going to come to a moment here after the election.
Let`s say Obama gets re-elected, Republicans are basically going to have to
choose. They still control the House no matter what in that lame duck
session, and they have to decide, you know, are we willing to cave on this?
Are we willing to cave on 22 years of absolute rigidity on taxes, you know,
in the interest of sparing 98 percent of the people a tax hike? Or are we
going to back off and say, no, if we can`t have it all, we`re going to
allow a tax hike to take place.

BALL: Well, and the corollary to that is, is the president ready to
go to the mat over this? Is he willing to let those bottom income tax
rates of the 98 percent go up in order to not raise rates on the top

So, that`s the other piece. And he and Robert Gibbs have been very
clear they`re not going to be held hostage this time. And I think they are
willing to go to the mat this time, whereas the last negotiation, I don`t
think they were willing to and instead they used it as a bargaining chip to
get other things they wanted.

O`DONNELL: Well, it is very different from the last one. And what
I`m hearing from some Democratic senators and now even from some Republican
senators, something they will not say publicly, is that they are willing
and, in fact, some believe they need to go off the cliff on January 1st.
They need to allow the tax rates to expire, have every rate go up including
the bottom rate to go up in order to then on January 2nd put real pressure
on Congress, including Republicans in Congress to pass some kind of
adjustment to this.

Without the power of actually having the rates increase, the Democrats
-- some Democrats believe they can`t get anything. In other words, once
all the rates have increased, everything you do after that is a tax cut,
even if you only reducing four out of the six rates.

KORNACKI: Right. And there`s your way around that Republican pledge.

O`DONNELL: Some Republicans are secretly saying we need you to do
that. That`s the only way will be able to vote responsibly in a tiny
number of Republicans.

KORNACKI: And let`s be honest, there are some Democrats to consider
here. Because the Democrats will control the Senate in the lame duck
session. That means you`re going to Ben Nelson, he won`t be retired yet,
and Joe Lieberman voting with the Democrats still there. A guy like
Tester, let`s say Tester gets re-elected, is he going to want to be voting
for anything that could be perceived as a tax hike?

So, you`re going to have to deal with these people in the Senate on
the Democratic side so the logic that you`re talking about works for them,

O`DONNELL: Yes. There are Democratic senators who learned this
lesson the hard time last time around, which is if we let it go to the last
minute and we need a deal, we won`t get one. But if we let it to go to the
last minute and let them know, it`s OK with us if we don`t get a deal.
They will see -- the Republicans will see, OK, you`re going to put us in an
impossible position in January.

BALL: It`s a game of chicken. And that`s the thing -- if they
actually show, no, we`re willing to go off the cliff. Then not only you
have that stronger bargaining position, but I think as you`re saying, you
give a lot of conservative Democrats in red or purple states and
Republicans who signed onto this Grover Norquist pledge, you give them an
out. So, I think that actually makes a lot of sense.

O`DONNELL: And, Steve, the great thing politically and I never
thought I`d be saying this about a Democratic candidate for president, the
great thing politically for the Democratic candidate for president in
talking about taxes is that you get always to bring it back to Mitt
Romney`s tax returns, especially the ones we have not seen.

KORNACKI: Right. Although -- and I think right now in this campaign
talking about the Bush taxes, talking about and doing away with the
wealthy, I think this is a political winner for Obama right now. But I am
reminded of the experience of Bill Clinton, 1992, campaigned on the idea of
we`re going to ask the top 2 percent, we`re going to ask the wealthy to pay
a little bit more. The people that got rich under Reagan and Bush, the
people that benefit disproportionately, we`re going to ask them to pay
more. That`s what Clinton ran in `92.

It`s popular in `92. We turned around in ``93. He only raised taxes
in the top 1.8 percent. It got sold by Republicans as the biggest tax
increase in the history of the world, and there was revolt in `94.

So, the public attitude on things is funny. I think Obama is on solid
ground here, but I`m really curious when push comes to shove in December,
maybe into January how it`s perceived by the voters.

BALL: But, Steve, they`ve already bought into the Affordable Care Act
as the largest tax increase in the history the mankind.

KORNACKI: It`s become the second biggest.

O`DONNELL: It depends where you are on the calendar when it was the

But, yes, the Romney liability on taxation seems to be politically
unique. I mean, even -- we`ve had wealthy Republican presidents before
George H.W. Bush, wealthy family. But their personal wealth was never
perceived to be part of their actual governing decisions. I mean, Bush had
Republican philosophy about taxation. You saw very rich Democrats who
actually had a non-self-interested tax policies.

The fact that these policies are all to Romney`s only self-interest is
the peculiar part of this politics.

BALL: I think it`s that. I don`t think it`s his wealth that`s the
problem. I do think it`s the fact that he`s paying a lower income tax rate
than the lowest marginal income tax rate. He has all these offshore
accounts, Swiss bank accounts, Cayman Islands and Bahamas, and there`s a
terrible contrast he has with his father who was exactly the opposite. Who
was the model of transparency releasing 12 years of income taxes saying
that it would be -- it could be a fluke if you only released one year.

And Paul Krugman was writing today that at the time they were
reporting actually George Romney was going out of his way to not take
advantage of the loopholes in the tax system. As a result he was paying 36
percent -- 37 percent.

It`s all the exact opposite of Mitt Romney, and I think Americans
feel, OK, yes, you`re following the lettering the law. But there`s a
difference between a legalistic argument and moral argument. Do you really
believe in America? Do you really believe the things you`re saying when
you`re exploiting these loopholes to your own benefit?

O`DONNELL: Krystal Ball and Steve Kornacki, thanks for joining me
tonight -- especially you Steve coming in on dry cleaner day. I so
appreciate that.

KORNACKI: I`m sorry.

O`DONNELL: I so appreciate that.

KORNACKI: I`m staying in the dark.

O`DONNELL: Thank you both very much for joining me tonight.

Coming up, what do tax rates mean for job creation? Ezra Klein joins
me next.

In the "Rewrite" tonight, remember when Jon Stewart went on a CNN show
just to say how bad that show was? Well, we`ve got a perfect reply good
excuse to show you that video again tonight. That`s coming up.


O`DONNELL: Remember when Jon Stewart went on "Crossfire" just to say
how much he hated "Crossfire", a left/right argument show on cable news.
He just couldn`t stand it.

And not long after he went on "Crossfire" to say how much he hated it,
"Crossfire" was canceled and that kind of TV is not really what`s happening
on cable news anymore in this country. But in some countries, they`re
still doing crossfire TV. We`ll find out what`s happened to crossfire TV
and just how bad it can get out there in TV land in tonight`s "Rewrite."



OBAMA: We know what those who are opposed to letting the high-end tax
cuts expire will say. They`ll say that we can`t tax job creators, and
they`ll try to explain how this would be bad for small businesses.

But here`s the thing that you have to remember: the proposal I make
today would extend these tax cuts for 97 percent of all small business
owners in America. By the way, these tax cuts for the wealthiest Americans
are also the tax cuts that are least likely to promote growth.


O`DONNELL: Joining me now: Nick Hanauer, venture capitalist and
author of "The Gardens of Democracy: A New American Story of Citizenship,
the Economy and the Role of Government"; and Ezra Klein, "Washington Post"
and MSNBC contributor.

Ezra, walk us through what we know about the effect of tax rates on
job creation.

EZRA KLEIN, WASHINGTON POST: Interestingly, not actually that much.
It is very hard to pull apart all the different things that go into job
creation to figure out what role tax cuts are playing. What we do have an
understanding of is we have tax cuts and overall economic growth. We know
that they`re part of it, and it matters how you create your tax code.

But they`re not as Republicans put it the determinative part. If you
listen to Republicans, you would think that the economy is a simple
equation in which taxes are on one side and growth is on the other. If you
get taxes, you get everything else right.

Since 1950, the period of time in which Americans had the most
impressive growth was when our tax rate, our highest marginal tax rate was
between 85 percent and 90 percent. The second high was at 39 percent. The
third highest at 39.6 percent and one of the lowest was in the Bush years,
when it was down at 35 percent.

So there`s not a really good record of low marginal tax rates on the
richest Americans leading to very impressive levels of growth and/or job

O`DONNELL: Nick Hanauer, you`ve been out there in this economy making
an awful lot the money for yourself. Hundreds of millions of dollars,
seeing others do it, working with job creators. What do you hear just
anecdotally in the world of real job creators, people running companies
that really do the hiring out there in terms of what factors determine when
they do their hiring?

NICK HANAUER, VENTURE CAPITALIST: Well, I just have to start by
saying that it`s just dead false that people who run companies are job
creators. This idea is a way of completely misunderstanding how economies

The people who create jobs are our nation`s middle -- is the middle
class. When the middle class consumer buys something from a company, that
is what creates jobs. And that`s why it doesn`t matter very much if rich
people pay higher rates of tax because the true engine of job creation is a
thriving middle class, and, you know, if somebody like me who makes
millions or tens of millions of dollars a year pays a little more, it has
virtually no effect on growth.

O`DONNELL: And, Ezra, we hear Warren Buffett say he`s never made a
business decision based on what marginal tax rates were. That like Nick,
he looks at things like consumer demand and this sort of thing to determine
when you should make different kinds of moves in this economy.

KLEIN: Yes. I mean, imagine a marginal tax rate can be 25 percent or
50 percent and you made another dollar. Either way, you just made a
profit. Now, you might not care about the profit if it`s 50 cent rather
than 25, but it remains a profit. But that`s something to what nick said.

Peter Diamond is a Nobel Prize winning economist and he made this
point that I thought was very, very fascinating. He said when you`re
worried about job creation, you`re not thinking about people. You are
thinking about businesses. Businesses are what create jobs, and primarily
the kind of businesses that create jobs are small, new ones. We tend to
have much more job growth in new firms than we have in older firms or in
larger firms.

And when you worry about small, new firms, what you worry about is
their ability to get capital. You`re worried about their ability to get
the amount of money they need to expand. If you`re a big firm, it`s easy
to borrow and if you`re rich it`s easy to start a firm.

But if you`re a small firm, started a new firm that doesn`t have good
access to the credit market and started by someone without a lot of money,
what you care about is that people without a lot of money and the people
around you have enough money to help lend you the amount of capital you
need to get started. They can take it out of their house. They can get it
loaned over from friends.

This is in the real economy how a lot of small businesses work. And
so, in that world, what you really want for businesses to thrive,
particularly ones that wouldn`t thrive otherwise, is for them to be a
progressive distribution of income because you need to have money in places
where it`s hard to get money in order for these good ideas to get off the
ground and expand and hire people.

O`DONNELL: Nick, I really like your correction of your language about
this one, which is our conceptual frame, which says job creators are the
middle class, the consumers who create the demand for a product. So, we
will call what Republicans are referring to as job creators -- let`s refer
to them as the hirers. They do the hiring in effect, the people who own
the companies and run the companies doing the hiring.

Making a hiring decision involves a set of factors, and when you hear
Republicans say that the hiring decision is based on what the income tax
rate is, what would your response be to them?

HANAUER: It`s the silliest lie ever told. Look, anyone who ran a
business knows that creating jobs is the course of last resort for
capitalists. It`s what we do if and only if rising consumer demand
requires it.

Look, if there was a shred of truth to the idea that the more
profitable the company was or the more capital valuable or the more jobs we
create, the more capital available there was, then today, Lawrence, we`d be
drowning in jobs. American corporations are sitting on $2 trillion of
cash. The nation is awash in capital. That`s not the problem.

And it all starts with this misconception that businesses are job
creators. It`s like a business person calling themselves a job creator is
like a squirrel claiming to create evolution. It`s just not true. It`s
the other way around.

The Romney people put it beautifully this week when one of them said
that there are people who are the engines of the economy, the job creators,
and everyone else relies on that engine. This way of expressing it shows
perfectly how deeply we misunderstand the economy.

The economy is characterized by feedback loops like any ecosystem, and
it`s about a circle of life feedback loop between customers and businesses.

O`DONNELL: Ezra, basic economic courses teach basically that. But
politics just loses that -- the concept completely.

KLEIN: Politics is never known for being all that economically
sophisticated. But, look, Nick is right. You can`t have jobs and you
can`t have expansion without people there to buy things. The idea is what
we need right now are lower tax rates on the business side. Look, there`s
something to that. It does become more profitable to hire people, for
instance, if you pay lower payroll taxes.

But that is a really marginal change. The reason you hire people is
because you need to hire them because there are profitable opportunities
you can only take advantage of if you have more people. Until you get
money into the pockets of the people who buy things, which you can do by
hiring them by building infrastructure, which you can do by giving them tax
cuts that affect people who have a high propensity to spend and use the
money to buy groceries, you`re not going to see fast job creation -- not
because there`s something deeply wrong with the economy or taxes are at
that too high and businesses are doing what they should be doing and not
expanding when they don`t have profitable opportunities.

The moment they have enough sales to expand, they will expand.

HANAUER: They will. Exactly.

O`DONNELL: Nick, Senator Moynihan used to talk about what he called
semantic infiltration. If we can get -- if one side can get the other side
to use their language, then they have won.

I think your point about who is a job creator is a perfect example of
how semantic infiltration has been at work here in our politics and in our

HANAUER: Yes. I agree completely. I think the fight we have over
economics in this country is going to come down it to who do the nation`s
citizens believe are job creators? Rich business people like me or the
middle class? We`ve had 30 years of trying out the idea that rich people
like me are job creators and we`ve seen what -- we`ve seen what happened.
I think it`s time to try a new way.

O`DONNELL: Nick Hanauer and Ezra Klein, thank you both for joining me

HANAUER: Thanks so much for having us.

O`DONNELL: Coming up, the dangers of having very sharp, angry
disagreements on live television, and why I don`t like to do that kind of
argument thing here on this show. I will show you why coming up in
tonight`s Rewrite.

And a new report indicates the split in the Supreme Court is now very
deep and permanent. These nine judges are not the same after the health
care decision. Jonathan Turley joins me.


O`DONNELL: Yesterday Mitt Romney held three fund-raisers in the most
affluent section of Long Island, where billionaires go to the beach. The
first event took place at the estate of Revlon chairman and billionaire
Ronald Pearlman. Tickets ranged from 5,000 for lunch to 25,000 for a VIP
photo reception.

The next fund-raiser was at the home of Clifford Sobel (ph), an
ambassador to Basil under President George W. Bush. And the big event was
a dinner at the South Hampton home of billionaire industrialist David
Coach. The cost to get in, 75,000 a couple.

"The New York Times" quotes one woman was waiting in line in her black
Range Rover, "is there a VIP entrance? We are VIP."

Then there`s the New York City donor the "L.A. Times" caught up with.
She was also driving a Range Rover and did not want to give her name, but
she did say that Mitt Romney needed to do a better job connecting. "I
don`t think the common person is getting it. Nobody understands why Obama
is hurting them. We`ve got the message, but my college kid, the baby-
sitters, the nails ladies, everybody who has the right to vote, they don`t
understand what`s going on. I just think if you`re lower income, one,
you`re not as educated; two, they don`t understand how it works. They
don`t understand how the system works. They don`t understand the impact."

Joining me now, someone who does understand the impact, Florida
Congresswoman Debbie Wasserman Schultz, chairwoman of the Democratic
National Committee.


O`DONNELL: What I love about what she said -- great to have you here
tonight. What I love about what she said is she included among the people
who just don`t get it her own college kid, who apparently is affluent
enough that, you know, the mother can go to a 75,000 dollar a couple event.

WASSERMAN SCHULTZ: Well, I think actually what the reality is that
working folks, working families like the nail ladies and the cleaning
ladies and even college kids of wealthy people, understand that President
Obama has been fighting hard to make sure that we can create jobs and
opportunity for them, invest in education and innovation, make sure that we
can out-compete and out-innovate and out-educate the rest of the world, so
that when we are competing on a global stage that America can be on top
consistently, in industry and in education and in innovation.

And Mitt Romney and the Republicans have been focused so much on those
folks who were guests at that -- at those events that -- and making sure
that they can do even better than they already are, that they`ve sort of
left the nail ladies and the college kids out in the cold. I think that`s
what they understand.

O`DONNELL: Congresswoman, I couldn`t help but wonder if maybe that
woman`s college kid, as she referred -- we don`t even know if it`s a male
or female college kid. So I`m just going to pick daughter. OK, we`ll just
decide it`s a daughter. Maybe her daughter actually has a roommate at
college or someone at college who is dear to her and she knows well, who is
struggling with student loan debt. Maybe that might be something that her
college kid knows about that mom doesn`t know about.

WASSERMAN SCHULTZ: Or maybe she has a friend who doesn`t have health
insurance coverage. Without being able to stay on her parents` insurance,
which she can now do until she`s 26 years old. Exactly, exactly. So
there`s been so much progress made for working families. Finally they have
a champion in the White House. I think that`s why folks like those people
that the donor named so-called don`t get, it in that woman`s eyes.

O`DONNELL: There was an odd moment. You were on Fox News yesterday.
It was an odd moment where they ran out of time apparently on a question
for you. They were talking about Mitt Romney`s offshore accounts. And the
host of the show, substitute host was reading a statement from the campaign
about the offshore accounts. Let`s watch that.



UNIDENTIFIED MALE: This comes from Romney spokesman Kevin Madden, who
says, quote, "he hasn`t paid a penny less in taxes by virtue of where these
funds are domiciled. Talking about his Bermuda and Cayman Island accounts.
His liability is exactly the same as if he held the fund investments
directly in the U.S. As a U.S. citizen, he`s accountable for U.S. taxes.
Some investments in foreign countries can be tax havens, but Mitt Romney
does not hold any such investments."


O`DONNELL: And then at the end of that read, they kind of ran out of
time before you could make a comment. What were you going to say, if Fox
didn`t have to go to a commercial?

WASSERMAN SCHULTZ: What I was going to say is how would we know? I
mean, the bottom line is that because Mitt Romney has only released one
year of his tax returns, even though he gave 23 years of tax returns to
John McCain, we have no idea. We have only the word of a spokesperson that
works for Mitt Romney. And that`s why George Romney, Mr. Romney`s own
father, when he ran for president, said that releasing one year of tax
returns maybe an anomaly and it`s not enough. And he set a precedent of
multiple years of tax returns, so that you could have transparency, so that
you could examine the finances of a candidate offering themselves for

So Mitt Romney isn`t even willing to live up to his own father`s
standard or the standards of every major recent presidential candidate
going back several decades. So we could actually see whether or not Mitt
Romney`s spokesman is accurate if we could actually see what his finances
are hiding. A Bermuda corporation, Swiss investments, Cayman Island
investments. Why does an American businessman, Lawrence, need to have a
Swiss bank account or a Bermuda corporation?

Why did Mitt Romney transfer that Bermuda corporation to a blind trust
in his wife`s name the day before he became governor? Those are unanswered
questions that Mitt Romney needs to answer.

O`DONNELL: If you are asking me, it`s to hide the money from taxation
and from American taxation rates. Congresswoman Debbie Wasserman Schultz,
thanks for joining us tonight. Whenever they run out of time on you on Fox
News, you get to come here to complete the thought.

WASSERMAN SCHULTZ: This was so delicious. Thank you so much.

O`DONNELL: Thank you.

Coming up, why having two people with diametrically opposing views
fight it out on TV can turn out to be a very bad and dangerous idea, and
maybe lead to a case of attempted murder. That`s in tonight`s Rewrite.

And the number one -- number one reason why you should vote for -- why
you should always vote for president is, of course, the Supreme Court. The
Supreme Court is not what it once was. There is the bromance, the
Scalia/Roberts bromance, that`s over. We`re going to talk about it coming
up later.


O`DONNELL: In tonight`s Rewrite, whatever happened to crossfire TV?
You know, I`m sometimes asked why I don`t have two people with
diametrically opposite views come on this program and fight it out. We
used to have a lot of that kind of programming on cable news channels,
including this one. The original cable news show that specialized in left-
right shouting matches was actually called "Crossfire."

And one day in 2004, Jon Stewart went on "Crossfire" to say he`d had
quite enough of "Crossfire."


JON STEWART, "THE DAILY SHOW": Why do you argue? The two of you? I
hate to see it.

I made a special effort to come on the show today because I have,
privately amongst my friends and also on occasional newspapers and
television shows, mentioned this show as being bad.

And I felt that that wasn`t fair. And I should come here and tell you
that I don`t -- it`s not so much that it`s bad as it`s hurting America.
Stop. Stop, stop. Stop hurting America.

When have you people on for just knee jerk reactionary talk --

TUCKER CARLSON, "THE DAILY CALLER": I thought you were going to be
funny, come on.

STEWART: No, I`m not going to be your monkey.

CARLSON: Go ahead.

STEWART: I watch your show every day and it kills me.

CARLSON: I can tell you love it.

STEWART: It`s so painful to watch. It`s someone who watches your
show and cannot take it anymore. I just can`t.


O`DONNELL: Everyone in the cable news business stared at that Jon
Stewart appearance on "Crossfire" more than once. And faster than Jon
Stewart could have imagined, "Crossfire" and its imitators disappeared, in
this country anyway.

But crossfire TV is alive and well in many other countries. In Jordan
last week on a show that books opposing guests with the hope that they will
get almost out of control, crossfire TV finally went where it was bound to
go. Somebody pulled a gun.





O`DONNELL: And, yes, the control room cuts the audio. And the guy
with the gun could now face charges for attempted murder and defamation, as
if defamation mattered. And that is -- that is why I don`t do crossfire
TV. I don`t want to be that guy, the hold them apart guy. I just -- no,

Now we know Jordanian television needs two things. One, metal
detectors at their TV studios. And two, it`s very own Jordanian Jon



ROMNEY: Well, I certainly wouldn`t nominate someone who I knew was
going to come out with a decision I violently disagreed with -- or
vehemently, rather, disagreed with. And he reached a conclusion I think
that was not accurate, not an appropriate conclusion.


O`DONNELL: Well, he was for him before he was against him. That was
Mitt Romney last week talking about Chief Justice John Roberts and why he
wouldn`t now nominate someone like John Roberts to the Supreme Court.
Here`s what Romney had to say about Roberts during the primaries.


UNIDENTIFIED FEMALE: Quickly down the line with just a name, favorite
Supreme Court justice.

ROMNEY: Yes, Roberts, Thomas, Alito and Scalia.

In my view, if we had justices like Roberts, Alito, Thomas and Scalia,
and more justice like that, they might well decide to return this issue to
states, as opposed to saying it`s in the federal Constitution.


O`DONNELL: According to some reports, no one is more disappointed in
Chief Justice John Roberts than some members of the Supreme Court.


liberals from the beginning my sources say, that would have been one thing.
But to have switched his position relatively late in the process infuriated
conservatives. Of course, we don`t know why he switched. He may have been
focused solely on the law.

But that is not what some of his colleagues believe.


O`DONNELL: Joining me now, Jonathan Turley, a constitutional law
professor at George Washington University. Jonathan, I`ve always thought
that justices changing sides during deliberations was not that uncommon.

fact, chief justices can game the system. Because they`re always the most
senior justice voting in that first conference, they can essentially take
control of the drafting process.

What I think is different here is that this chief justice didn`t
usually change. This is the first time in his entire history on the court
that Roberts switched to vote with the liberals in a five to four decision.
This is a court that is replete with five to four decisions.

So I think what was shocking is not that a chief justice would do it,
but that this chief justice would do it.

O`DONNELL: You have the report they`re saying that the judges don`t
think that he was focusing on the law. They think he was focusing on
something else. The justices who ended up in the minority, who he

TURLEY: Well, there`s obviously a great deal of bad blood here. And
Roberts` decision didn`t sit well, obviously, with the conservative members
of the court. It`s a departure for Roberts. His opinion didn`t hold quite
together as well as the opinions on either extreme, Scalia`s and Ginsberg.
They both were very consistent in how they viewed the question of federal
authority, whether it was tax or whether it was the Commerce Clause.

Roberts had an opinion that seemed really to rest uneasily within
itself. And I think that has prompted many of the conservative justices to
view him as trying to do something other than be consistent on principle.

O`DONNELL: Jonathan, what`s at stake in the Supreme Court? The
composition of the Supreme Court in this presidential election in the next
presidential term? What retirements might we expect?

TURLEY: Well, it`s hard to say. First of all, I think for the last
10 years people have been calling and asking is it true that, you know,
Justice Ginsberg is leaving tomorrow?

O`DONNELL: She`s 79 years old.

TURLEY: Yes. But the poor woman, the people have been writing her
departure commentary for over a decade. She just said just recently, I`ll
be 80 next year, and I don`t think that`s that old. But she is 79. The
average life expectancy in the United States is 78, to give you a measure.

And you have Scalia who is 76. You have Kennedy who is 75, Breyer who
is 74. That`s four of the nine. And so these are people who obviously
have great longevity. They lifestyles that enable them to be, frankly,
healthy and productive longer in life.

Stephens just retired at 90. Blackmon retired at 85. So it`s very
hard to apply the measure for most people to members of this court. They
clearly do not like to give up this job. But if you look at the ones in
the `70s, Romney could change dramatically the trajectory of this court
just for those four alone.

O`DONNELL: Jonathan Turley gets tonight`s LAST WORD. Thanks,

TURLEY: Thanks, Lawrence.


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