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updated 8/5/2009 9:59:21 AM ET 2009-08-05T13:59:21

HARDBALL

August 4, 2009

THIS IS A RUSH TRANSCRIPT.

THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

Guests: Mike Huckman, Chris Cillizza, Jeanne Cummings, Sen. Barbara Boxer, Sen. Judd Gregg, Sen. Arlen Specter, Rep. Joe Sestak, Pat Toomey

CHRIS MATTHEWS, HOST: The roar of the crowd.

Let's play HARDBALL.

Good evening. I'm Chris Matthews in Washington. Leading off tonight:

health menace. Those angry, noisy, shout-'em-down protests at congressional town halls are getting to be a lot more about things than health care. They're about those who are not rooting for the health of this president and his future. They're about a deep political and cultural divide in this country.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Silent no more! Silent no more! Silent no more!

UNIDENTIFIED FEMALE: Silent no more! Silent no more! Silent no more!

UNIDENTIFIED MALE: Silent no more! Silent no more! Silent no more!

(END VIDEO CLIP)

MATTHEWS: As I said, these people do not want Barack Obama to succeed as president. These mob scenes are about end-of-life issues, with some Republicans saying the government wants to off old people, or at least get them to off themselves, and about whether taxpayers will have to pay for someone else's abortion. We'll talk to two senators about the latest front in the political culture war, also about this cash for clunkers program, which car buyers seem so gung-ho about.

Also: Who's behind those protests at congressional meetings? Are they the spontaneous, grass roots, anti-government anger, or are they what are called astroturf protests-in other words, systematically organized by the far right and backed by the insurance companies?

Plus: Call it the HARDBALL primary we've got tonight. All three major candidates for the U.S. Senate in Pennsylvania next year are going to be here-Arlen Specter, the incumbent, Joe Sestak, who announced today he's challenging Specter in the Democratic primary, and Republican Pat Toomey, who's out-polled Specter in earlier Republican polls, and now that Specter has switched parties, has pulled even with him in general election polls. It's your kickoff-our kickoff to the 2010 mid-terms nationwide.

And in the HARDBALL "Sideshow," we've got proof that Republicans and "birthers" aren't the only one who fall prey to odd-duck conspiracy theories. Apparently, some people on the left have some wacky theories, as well.

But first: Are the protests at those town hall meetings the product of real grass roots rage and resentment over big government and health care reform, or are they being orchestrated by the right? White House press secretary Robert Gibbs was skeptical about the grass roots nature of these angry mobs. Here's what he said today.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I also have no doubt that there are groups that are-have spread out people across the country to go to these things and to specifically generate videos that can be posted on Internet sites so that people can watch what's happening in America.

(END VIDEO CLIP)

MATTHEWS: What's happening in America is right now, Chris Cillizza is with the Washingtonpost.com and Jeanne Cummings is with "The Politico." Jeanne, I want you to go first. If you had to explain American politics on August 4th, 19 -- well, 20 -- I keep getting that wrong -- 20 -- 2009, what would you say is going on at all these crazy meetings? We're going to show some of this B-roll of these meetings in Long Island, in Texas and Pennsylvania. Everywhere a congressperson holds a meeting, apparently, these people show up, well-dressed, middle-class people in pinks and limes, if you will. Who are they? They've been called the "Brooks Brothers brigade." Who are these people?

(LAUGHTER)

JEANNE CUMMINGS, POLITICO.COM: Well, they're conservatives who are being organized by several different Republican organizations. One of them is an organization committed to defeat health care. They're running on their site every list of town hall meetings they can find and encouraging people to show up. The Republican House committee is also urging and organizing people to go out to these town hall meetings and basically create a fuss that can then be-go viral on the Web and make it appear as though there's a great deal of opposition to the president's plan.

The problem is, at some of these town hall meetings, they have been outnumbered by citizens who would actually like to discuss the issue in a more civilized way, and they shouted those folks down.

MATTHEWS: Wow. Let me go to Chris Cillizza. Your thoughts? It's not usual to see the middle class in up arms, but these people look pretty well off. They don't look like rich people, but they certainly are not poor people demanding health care. Apparently, they have what they want. They don't want it touched.

CHRIS CILLIZZA, WASHINGTONPOST.COM: You know, Chris, to Jeanne's point, I think she's right. I'm always skeptical of turning a anecdote into a broader conclusion, which is that there's clearly an element of people, whether they're organized or not organized, who are not happy with this plan. If you look at national polling, and lots of it's been done in the last few weeks, support for the president's plan has waned a bit.

That said, you know, as someone who writes a blog for a living, I'm all in favor of civil, as opposed to incivil, discourse. So I think more is likely to get done by listening to one another, rather than shouting one another down.

MATTHEWS: Yes, but let's go to the issues that get people heated up.

It's not just the cost of the program because we're not clear about that. It's not even on the tax impact. We don't know that. It's about some of these cultural issues, these wedge issues.

For example, the word is out on the street that government employees are going to come to you and tell you to stop wasting Medicare money, stop wasting your family's money, get with this pull-the-plug program. That seems to be the way they're selling it on the right, Jeanne, that people are going to come to you rather ghoulishly and tell you, you know, You've become a burden, stop charging up all this health care cost, tell us to pull the plug on you. I mean, it sounds awful, but that is the message getting out there to a lot of people.

CUMMINGS: Well, certainly, they have taken parts of the plan and distorted some of them. Some of them are legitimate concerns that some seniors have that some health care procedures may not be available to them late in life. But the one that they have really distorted is one that revolves around hospice care. And what, basically, that is, is studies have shown is if seniors write down a much more detailed-not just a living will but real directives about what kind of care that they want...

MATTHEWS: Yes.

CUMMINGS: ... that then their wishes will be complied with. And many times-what they have found in states that do this a lot better than it's done nationally, is that many times, people don't want to die in an ICU unit, they want to die at home with their family. And clearly...

MATTHEWS: Right. I'm with you on that. I think-fair enough, that most people would be smart to make these declarations clear so that their relatives don't have to make the decisions, like in the Schiavo case, where the whole country got involved. Senators got involved. Members of Congress were legislating on the floor what to do with this poor woman when she was in that state. We were all looking at pictures of it. To avoid that, the person themselves has to make it clear.

But Jeanne, the question is, does somebody come to you and aggressively say to you, Look, these are the options, or do you look at a form somewhere, like we all should do, look at our insurance policy and say, Somewhere in here you can have this paid for, this consultation? Is it aggressive or is it passive?

CUMMINGS: No, it's passive. It's an offering to people who are on Medicare that the government will pay-will cover the cost of a consultant to come and help a person prepare such a document. They're not required to prepare it. They are encouraged to prepare it. And the government would pay for the person to come and help them do it so that it's binding and it can't be challenged a host of different ways. And also, they would help them create the kind of detailed language that's necessary, given whatever their condition is...

CILLIZZA: You know...

CUMMINGS: ... because that's another problem. You leave a living will, but your condition changes as you get older and you get sick, and it doesn't really apply.

CILLIZZA: Chris...

MATTHEWS: Well, these are hot issues. Chris, go ahead, quickly.

CILLIZZA: I was just going to say this is why it's hard to do big reform on big issues because little pieces of misinformation here and there can really influence a debate. That's why...

MATTHEWS: Are you saying that the devil is in the details?

CILLIZZA: Absolutely.

MATTHEWS: Thank you very much!

(LAUGHTER)

MATTHEWS: I love those cliches because they're always true. Thank you, Chris Cillizza. Thank you, Jeanne Cummings.

Coming up next, we've got two U.S. senators to talk about-Senator Barbara Boxer of California and Judd Gregg of New Hampshire will be here to talk about, well, the culture war that seems to have permeated into the health care issue.

You're watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. The fight over health care reform is heating up as some Republicans say the bill will kill elderly people and subsidize abortions. So what will end up in this health care bill? We have two U.S. senators joining us right now. We begin with Democratic senator Barbara Boxer of California. She's author, by the way, of the new novel, "Blind Trust."

Let me ask you, Senator, what is the issue that seems to be being raised by conservatives that this is going to encourage older people to be confronted with end-of-life decisions they wouldn't normally bring up?

SEN. BARBARA BOXER (D), CALIFORNIA: Well, all this fuss about elderly people being forced to do anything is totally wrong, as your previous guest pointed out. All that was put in one of the bills is that if a senior citizen would like some help discussing end-of-life issues, they can avail themselves of it. So that's just a distraction, as is the whole abortion matter because we don't change law there, either. All these laws will apply.

Here's the point. Every day, 14,000 people lose their health insurance because either their employer drops it or it's just too expensive or their insurance company walks away. We have so many problems today. If we keep on the way we're keeping on in your old state of Pennsylvania, the average family will be paying 50 percent of their income by 2016. In California, 41 percent for premiums. It's unsustainable.

So people are trying to divert us off. I think a lot of insurance companies are behind this. You know, they've made a 400 percent increase in profits in the last few years. Their CEOs make $14 million, $20 million a year. So they're taking us off in this culture war direction that has nothing to do with anything, really.

MATTHEWS: Well, in other words, a person, no matter what age, isn't going to be confronted by government agents and forced to make decisions about their end-of-life decisions. You're saying it will not be in the bill.

BOXER: That's right.

MATTHEWS: And number two, no abortion...

BOXER: What's...

MATTHEWS: No abortion's going to be paid for by the health care bill, is that correct? No abortion is going to be subsidized by the health care bill?

BOXER: Yes because the Hyde Amendment is still in play and will continue to be in play. So all of this is a diversion by the people who want to, frankly, hurt President Obama. You've heard the Republican senator Jim DeMint say it, Let's make this Obama's Waterloo. Let's break him.

MATTHEWS: Yes.

BOXER: That's what this is about. And by the way, I saw some of the clips of people storming these town hall meetings. The last time I saw well-dressed people doing this was when Al Gore asked me to go down to Florida when they were recounting the ballots, and I was confronted with the same type of people. They were there, screaming and yelling, Go back to California, Get out of here, and all the rest of it, until I finally looked at them and I said, you know what? Your hero, Ronald Reagan, is from California. You should show a little respect, and then they quieted down.

So if this is just all organized-just go up on the Web site, Chris. You, in the media, have to take a look at what's going on here. This is all planned. It's to hurt our president and it's to change the Congress.

And you know what? We went to the White House today. We heard President Obama. It was wonderful to hear him. He's so calm and cool about this. He says, We got to be tougher. We got to be stronger. We have the truth on our side on these issues. We'll just get out there and present those facts to the American people and let them choose between people who are screaming and those of us who are trying to explain how we can really help our families afford medical care in this great nation of ours.

MATTHEWS: Do you think the health insurance companies that have made money for years on health care are the bad guys here? Do you think they're behind these so-called astroturf demonstrations, that they're not really grass roots, these Brooks Brothers attacks on these congressional meetings?

BOXER: I think it's a combination of things. I think it is definitely the right wing in this country trying to hurt this president and hurt this Congress. They're out there playing politics with it. And I have to believe the insurance companies. They have the most to lose. These CEOs, they've been having a ball every year, $20 million in a salary. Do you know how many families could have had, you know, health insurance for that? It's really a shame.

We pay twice as much as any other country for health care. Do you know where we are in infant mortality, Chris? We're 29 out of the 30 industrialized nations. And on life expectancy, 24 out of 30. We can do better and we will do better. We have to have the courage to face those crowds, to make the point that what we're trying to do is what is really what the American people want us to do, what they voted for, bring change and make their lives more secure by ensuring that their health insurance will be there when they need it and it will be affordable. That's what we're trying to do.

MATTHEWS: OK. Thank you so much for joining us tonight, Senator Barbara Boxer of California.

Let's bring in right now Senator Judd Gregg, a Republican of New Hampshire. Senator Gregg, where are you on this health care thing? Are you with the people who think it's a cultural issue, that there's abortion money in here somewhere, that there's people pushing people to make end-of-life decisions, sort of, you know, like ghouls? Are these cultural questions legitimate or not?

SEN. JUDD GREGG ®, NEW HAMPSHIRE: No, but basically-but there are some legitimate questions, and the questions go to the issue of how much this is going to cost, how you cover all Americans, and how you that by bending the out-year cost curve and how you keep the government from basically stepping in and being the primary insurer in this country, which leads to putting a Washington bureaucrat between you and your doctor and inevitably leads to a system like they have in England or in Canada, where you see delays and rationing.

And those are very big public policy issues. We can do some good things here. We can make the health care system work a heck of a lot better for all Americans. And if we focus on what the problems are, rather than what the hyperbole is, I think we can have some success.

MATTHEWS: Do you-it sounds like you suspect that behind the proposals of the president and his people on the Hill is this purpose, which is to basically go to the European-style singer payer or Canadian plan, whatever you want to call it, where the government runs the plan. Do you think that's their real purpose here in pushing these proposals?

GREGG: Well, there's clearly a group of folks in the Democratic Party who wish to move in that direction. They're very open about it-Bernie Sanders, Sherry Brown, Tom Harkin. They all basically during the mark-up of the Kennedy-Dodd bill on the committee that I serve on were very open in their desire to move to a single payer system.

I don't believe that works, and I don't believe it improves our health care system. And in fact, I think it fundamentally undermines innovation and it does end up putting a Washington bureaucrat between you and your doctor and it does end up inevitably leading to delays and rationing and to undermining the quality of health care in this country.

There are ways to reduce the health care costs in this nation without having the government take over the program.

MATTHEWS: Yes.

GREGG: And the government taking over the program hasn't proved that well in a lot of programs we've seen recently.

MATTHEWS: Can you imagine being a member of the cabinet right now in a situation where you'd have to defend what you think is a push to move towards this kind of government control at the time you're selling the economic philosophy of this administration? Can you imagine being in this situation?

GREGG: No, obviously not. I mean, the budget was really a separation point for me. When you propose a budget that runs trillion-dollars deficits every year for the next 10 years and takes our public debt up to about 80 percent of GDP, which puts us in about the same category as a few banana republics in South America-it, it's an unsustainable situation, passes on to our kids a country they can't afford and basically puts us in a position where we as a nation will see our dollar devalued and our debt very difficult to sell.

MATTHEWS: Here's what I don't understand. You seem to care a lot about issues. I mean, you have a philosophy, moderate Republican, I guess Yankee Republican, and yet here you are, leaving your political career to what looks like a Democratic pickup of your seat. How do you explain it?

GREGG: My seat will not go (INAUDIBLE) no, I disagree with you on that, Chris. We've got one very strong candidate who's been talked about and...

MATTHEWS: Yes, but you know which way the wind is blowing. The wind is blowing in the Northeast totally against the Republican Party. Specter's gone south on you. You've lost all these other seats in Rhode Island. You're losing them everywhere. And you're now going away, leaving that seat open. It seems to me if you care about moderate Republicanism, you'd defend it.

GREGG: Well, I've been doing this for 30 years, Chris, so there is a time to move on. But as a very practical matter, New Hampshire remains a very "Live free or die" state and we very much believe in fiscal responsibility. And I suspect we'll be sending someone to take my seat who believes, as I do, that we as a country cannot pass these massive debts on to our children and we shouldn't be spending the type of money that's being spent right now. So I'm pretty positive about our ability to keep my seat.

MATTHEWS: Well, I hope they save the two-party system in the Northeast because it keeps these guys honest. Thank you very much, Senator Judd Gregg of New Hampshire.

GREGG: Thank you, Chris. Thanks for your time.

MATTHEWS: Up next: President Obama turns 48 today. How did he celebrate his birthday? By the way, his problem now isn't when he was born, it's these crazies out there arguing about where he was born, if he's one of us or not. Stick around for the "Sideshow."

You're watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Back to HARDBALL. Time for the "Sideshow."

First up: Obama hits the 48-year mark. The president took a break in his day, popping into the White House press room today to wish old pro Helen Thomas a happy birthday.

(BEGIN VIDEO CLIP)

UNIDENTIFIED REPORTER: Happy birthday, Mr.-happy birthday, Mr.

President.

(CROSSTALK)

OBAMA, UNIDENTIFIED REPORTERS, AND UNIDENTIFIED MALES AND FEMALES

(singing): Happy birthday to you. Happy birthday to you. Happy birthday,

dear Helen. Happy birthday to you

(APPLAUSE)

(CROSSTALK)

OBAMA: You have got to blow it out to make it come true.

(LAUGHTER)

OBAMA: There you-hey!

Helen wished for world peace, no-no prejudice. But she and I also had a common birthday wish. She said she hopes for a real health care reform bill.

(LAUGHTER)

(END VIDEO CLIP)

MATTHEWS: I have no doubt in my mind that Helen Thomas voted for Barack Obama.

Anyway, she's been covering presidents since Jack Kennedy.

The latest issue for President Obama, whose birthday is also today, August 4, is not on what day he was born, or even what year, at least among the far right-out righters out there. It's not a when question, but a where, America or Kenya. The so-called birthers say it was Kenya he was born in.

What do you think?

Next up: Remember this rallying cry from Sarah Palin's farewell speech?

(BEGIN VIDEO CLIP)

SARAH PALIN ®, FORMER ALASKA GOVERNOR: You're going to see anti-hunting, anti-Second Amendment circuses from Hollywood. Stand strong and remind them, patriots will protect our individual guaranteed right to bear arms. And, by the way..

(CHEERING AND APPLAUSE)

PALIN: ... by the way, Hollywood needs to know, we eat; therefore, we hunt.

(END VIDEO CLIP)

MATTHEWS: Wow. Well, the ex-governor continued her crusade at a National Rifle Association event in Anchorage this past weekend. A write-in, by the way, on the NRA's Web site says Palin gave a stirring speech on Second Amendment rights and earned a handful of lifetime awards, including the Gold Medal Award of Merit for the promotion of gun collecting, a trophy that's only been bestowed twice in the last decade.

It's a bad day for mooses.

Time now for tonight's "Big Number."

Remember the poll last week where a majority of Republicans said either no or not sure when asked if President Obama was born in the U.S.? Well, here is a blast from the past, courtesy of RealClearPolitics.

Back in 2007, two years ago, Rasmussen polled voters with a similar out-of-left-field question asking whether they believed then-President Bush, George W. Bush, had gotten the inside word that the World Trade towers and the Pentagon were about to be hit on September 11, 2001. We're talking hard intel as to what was coming that day, how the hijackers were going to grab those planes and fly them into buildings.

Well, how many Democrats said either, yes, Bush knew or that they weren't sure whether he knew about that, not sure whether the president deliberately sat back while America's cities were attacked and thousands were killed? Well, think about it. Sixty-one percent, a majority, evidence that both parties hold the darkest of suspicions about the other party and its leaders.

Sixty-one percent of Democrats back in '07 said Bush either knew or might have known about 9/11 ahead of time-tonight's scary "Big Number."

Up next: Senator Arlen Specter switched parties to avoid a tough primary fight on the Republican side. Now he's got one on the Democratic side. U.S. Congressman Joe Sestak announced today he's going to challenge Specter, to earn the right to have to face the general election challenger, Pat Toomey, in the fall. What a fight. We have got it all here tonight with all three Pennsylvania Senate candidates, Specter, Sestak, and Toomey.

It's the battle, the first HARDBALL primary of the season.

You're watching it, only on MSNBC.

(COMMERCIAL BREAK)

MIKE HUCKMAN, CNBC CORRESPONDENT: I'm Mike Huckman with your CNBC "Market Wrap."

Stocks ending relatively flat today, as investors cashed in on Monday's blockbuster rally, the Dow Jones industrials adding 33 points, the S&P 500 up three points, and the Nasdaq finishing almost three points higher.

Kraft Foods posting earning just after the closing bell, more people eating food at home, mac and cheese, helping push their quarterly profit higher. Kraft also raising its full-year earning forecast. But shares are moving lower after-hours, as sales did come in lighter than expected.

Video game giant Electronic Arts also reporting after the closing bell, EA shares moving higher in extended trading, after reporting a smaller-than-expected quarterly loss.

PepsiCo shares are up more than 5 percent on word it plans to buy its two biggest bottlers for $8 billion.

And good news on the housing front today-pending home sales blew past expectations, jumping 3.6 percent in June.

That's it from CNBC, first in business worldwide-now back to HARDBALL.

MATTHEWS: Well, we have got the first HARDBALL primary of the season coming out now.

U.S. congressman Joe Sestak announced this morning that he will run against Senator Arlen Specter in Pennsylvania's Democratic primary next year. Specter, of course, is now a Democrat. The winner of that fight will face Republican Pat Toomey, it looks like, in the general election next November.

All three candidates are with us tonight.

We begin with Pat Toomey, the Republican.

(BEGIN VIDEOTAPE)

MATTHEWS: Mr. Toomey, thank you.

When you announced that you were going to challenge Arlen Specter for renomination, he switched-you beat him in the polls, and then he switched parties. What are voters to make of that?

PAT TOOMEY ®, PENNSYLVANIA SENATORIAL CANDIDATE: Well, I think what it demonstrates is that the only principle that's important to Arlen Specter is his own reelection.

He had crisscrossed Pennsylvania, adamantly insisting that he would never leave the Republican Party. And, then, about a week later, when he saw that he couldn't win this primary, he immediately abandoned the primary -- so-the-the party. So, I-I think it's pretty clear that the only thing important to Arlen Specter is his own political survival.

MATTHEWS: Do you think he's a liberal Democrat, as he's been voting lately? Is that who he is, as you have known him for years?

(CROSSTALK)

TOOMEY: You know, he is...

(CROSSTALK)

MATTHEWS: Is he a liberal Democrat, as you know it right now?

TOOMEY: Chris, Arlen Specter is whatever he thinks the political calculus suggests he should be at any moment in time.

Right now, that means liberal Democrat, because he's got a primary challenge from the left. If-if he manages to get by that, which I don't know that he will, but, if he does, he will be something else again. This is a guy who has made a career out of being on both sides of as many issues as he can.

MATTHEWS: Who is tougher for you to beat next November, Sestak, who has just entered-entered the race today, Joe Sestak, the congressman, or the senator?

TOOMEY: Yes, honestly, I don't know. They both have strengths. They both have weaknesses. I really don't know which one is easier to beat in the general election.

But I can tell you that either one of them presents a stark contrast. You know, they both supported all the bailouts. They have both supported massive unprecedented spending, huge government intrusion in health care, big tax increases. So, there will be a stark contrast between either one of those guys and myself, a supporter of limited government and less government spending, ending the bailouts, lower taxes, free enterprise.

I think it will be a stark contrast either way.

MATTHEWS: Are you on the political right?

(LAUGHTER)

TOOMEY: I'm on the center-right.

MATTHEWS: Center-right. Well, let's ask you about a couple issues.

What do you think about outlawing abortion? Arlen Specter is pro-choice. Where are you on that one?

TOOMEY: I'm pro-life.

MATTHEWS: Do-would you like to outlaw abortion?

TOOMEY: Yes, I'm-I'm pro-life. I think that...

(CROSSTALK)

MATTHEWS: Would you outlaw abortion? Would you put people in jail for...

(CROSSTALK)

TOOMEY: Let me...

(CROSSTALK)

MATTHEWS: No. Would you put people in...

(CROSSTALK)

TOOMEY: Would you let me...

(CROSSTALK)

TOOMEY: I will answer your question, Chris.

MATTHEWS: No. But I want to form the definition.

TOOMEY: I think Roe vs. Wade was wrongly defined...

MATTHEWS: OK. Right.

TOOMEY: ... wrongly decided. And I think states should be free to restrict abortion.

And I would support legislation in Pennsylvania that would ban abortion. And I would-I would suggest that we have penalties for doctors who perform them if we were able to pass that law.

MATTHEWS: Would you put people in jail for performing abortions?

TOOMEY: At some point, doctors performing abortions, I think, would -

would be subject to that sort of penalty.

MATTHEWS: OK.

Let me ask you about this birthers movement out there on the far right. Are you that far out?

TOOMEY: Well, what is it? What is it?

MATTHEWS: Do you question or do you have any doubts about this president, Barack Obama, being a native-born American, and therefore quite eligible to be serving as our president? Do you have any doubts on that subject?

TOOMEY: My-I-I don't have any doubts. I think he made it very clear a long time ago that he was born in Hawaii.

MATTHEWS: Well, what do you make of all this noise out there? Apparently, according to a new poll out there, 30 percent of your party now has doubts about it. And 20-some think he was born overseas. What do you make of that opinion in your party?

TOOMEY: I-I don't know what to make of it, Chris. People-people get a lot of different ideas. I can't explain ideas that I don't happen to hold.

MATTHEWS: OK. Well, let me ask you about the whole question of the culture issue. It teams so me, if you're going to win this election, you're going to win it on taxes, on government spending, on debt, the good, solid, middle-of-the-road issues.

How do you avoid this campaign becoming an issue about cultural questions? The Schiavo case, I believe, had a lot to do with killing the reelection chances of former Senator Santorum of Pennsylvania. Whether you agree or not, I think that's a tricky question in Pennsylvania, whether the government should get so involved in a case like that.

How do you avoid the cultural issues in this campaign that Specter could use against you or Sestak could use against you?

TOOMEY: A lot of the cultural issues cut both ways, Chris. I mean, I'm a big supporter of the Second Amendment. I don't think Joe Sestak is. I think Arlen Specter likes to have it both ways on the Second Amendment. That's an important cultural issue in Pennsylvania, where I am definitely on the right side of this issue.

I think, right now, the issue that's most important to people is the economy. It's jobs. That's always been my focus. I'm a guy that came from the private sector, a guy that actually worked in-in the real world, before going to Congress, where I sat on the Budget Committee and focused on economics and budgetary issues.

I think that is by far and away the most important issue on the minds of voters. It's exactly what I'm prepared to address. And I think it's going...

MATTHEWS: OK.

TOOMEY: ... to work very well to my advantage.

MATTHEWS: How do you think Arlen Specter votes in the voting booth? Does he-did he vote the last 30 years as a Republican in the privacy of the voting booth, or did he vote secretly for the Democrats or what? What's your sense, knowing the guy all these years?

TOOMEY: Chris-Chris...

MATTHEWS: What is he really?

TOOMEY: ... I don't know that he has a real core. I think he is whatever he needs to be at any given moment, based on his calculation.

I mean, look at the card check bill. He's a co-sponsor of the bill. He goes to a press conference endorsing the bill. He's all for it. Then he sees that he might have a primary against me. He decides he's against it. Then he decides he can't win the primary against me, joins the Democratic Party, and now he's looking for a way to be for it again.

So, I couldn't begin to predict how he votes in the privacy of a voting booth.

MATTHEWS: Well, look what...

TOOMEY: But I think everybody ought to have their privacy.

MATTHEWS: We will be-well, not guys who run for office don't.

Thank you very much, Pat Toomey.

TOOMEY: All right.

MATTHEWS: You voted for McCain last time, right?

TOOMEY: I voted for John McCain.

MATTHEWS: And you voted for Sarah Palin, right?

TOOMEY: She was on the ticket. I voted for both of them. That's right.

MATTHEWS: Wait a minute. Do you have to hesitation there? Do you think she would have been a better vice president than Joe Biden?

TOOMEY: Yes. Probably yes.

MATTHEWS: Probably yes?

TOOMEY: Yes, she would have been a better...

(CROSSTALK)

MATTHEWS: You sound a little unsure of your party loyalty. Do you think Sarah Palin was a good candidate for V.P. or not?

TOOMEY: You throw them at me quickly here, Chris. I want to-I want to make sure I tell you what I really think. And what I really think is that Sarah Palin...

MATTHEWS: Well, you voted. You could handle the-you could handle the question last-you could handle the question last November.

(CROSSTALK)

TOOMEY: ... that Sarah Palin would be a better vice president.

MATTHEWS: How about answering it now?

TOOMEY: I just did. How many times do...

(CROSSTALK)

MATTHEWS: I just...

(CROSSTALK)

MATTHEWS: ... for Palin.

TOOMEY: How many times? I said yes.

MATTHEWS: OK. It took you a while.

Thank you very much, Congressman Pat Toomey, running for the United States Senate for Pennsylvania.

Thank you for joining us.

(END VIDEOTAPE)

(LAUGHTER)

MATTHEWS: Still ahead: the two Democratic candidates for the Senate in this hot fight in Pennsylvania. Senator Arlen Specter is coming up, and the man who announced today he will challenge him, Joe Sestak, the congressman from Delaware County. It should be interesting. It's getting more interesting.

This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Coming up: Joe Sestak vs. Arlen Specter. And the winner gets Pat Toomey to run against. Specter and Sestak, the Democrats, are coming up here next.

Our Keystone State clash, our HARDBALL primary, the first of the season, continues when HARDBALL comes back.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. U.S. Congressman Joe Sestak announced this morning that he's going to run against Arlen Specter, the incumbent Democratic senator in Pennsylvania, next year. We're going to talk to Congressman Sestak in a few minutes. But now let's go to Senator Specter, who is joining us right now.

Senator Specter, you put out a Twitter today which was pretty tough about your new opponent in the Democratic primary. Quote, "his months of indecisiveness on his candidacy raise a real question as to his competency to handle the tough rapid fire decisions required of a senator. During his continuing tax-payer financed self-promotion tour around the state, Sestak should explain why, when Pennsylvanians are working harder, he can barely show up for work."

Is this your sentiment towards this guy?

SEN. ARLEN SPECTER (D), PENNSYLVANIA: Well, Chris, he's missed 105 votes; worst record of any Pennsylvania member of the House of Representatives. He's AWOL, been absent without leave. If he were still in the Navy, he would shall court martialed. Now he wants to be promoted. How can you be promoted with a voting record like that?

MATTHEWS: What do you think of Sestak?

SPECTER: I think he's a fine Congressman, and ought to stay in the House of Representatives. Look, I want to talk about myself in this campaign. I want to talk about what I've done for jobs in Pennsylvania.

MATTHEWS: Right.

SPECTER: Increased funding for health care, education, environmental protection; the experience I have had touching all 67 counties. Listen, I have been in a lot of tough campaigns, and I'm ready for another. I'm ready to take on all comers. It's nice to have President Obama and Vice President Biden and Governor Rendell all endorsing me. But I'm taking my case to the people. That's what I have always done and I'm going to do it again.

MATTHEWS: You said you wanted, senator, to talk about yourself. Let's talk about you politically. Last year, you were campaigning with McCain and Palin. Did you vote for them?

SPECTER: Yes, sir.

MATTHEWS: What do you say now about your choice? Do you think it was a good choice at the time? Seriously, as a voter, as an American, as a Pennsylvanian, do you think they would have been a better choice than what we have now?

SPECTER: I thought that they were the better choice. And I was trying to work within the Republican party, and trying to bring moderation to the Republican party. The decisive step I took was when I heard President Obama early this year say we were on the verge of sliding into a 1929 Depression, and a new president with a new mandate. And I voted for the stimulus package.

Now, up until then, Biden and Rendell and a lot of people had been trying to get me to become a Democrat. When I voted for the stimulus package, I had more Republicans urging me to become a Democrat than the Democrats. And the effort to bring moderation to the Republican party was not successful. And I feel very comfortable as a Democrat.

MATTHEWS: Yes, I know. I think-obviously, you were way back when. I remember. Let me ask you about how you are personally as a voter. We just had-we just taped the interview with Pat Toomey, and he seemed very uncomfortable when I asked him, did you vote for Sarah Palin, because she's gotten a bad press the last few months?

Are you comfortable now that you voted for her on the ticket, rather than say Joe Biden? I mean, he's a guy-he's a pal of yours, I think very much a strong-it's funny, but you guys voted for Palin and now you just turned and say-like you don't even know her anymore.

SPECTER: Well, I know her. I met her. And as a matter of party, I supported McCain and Palin. But when-

MATTHEWS: But what does that feel like now? You say you're comfortable as a Democrat. Is it comfortable to remember that you thought you'd make Sarah Palin a heartbeat away from the presidency? Does that feel comfortable?

SPECTER: Well, I didn't-

MATTHEWS: Right now.

SPECTER: Chris, I didn't exactly think my vote would be decisive. But when you're in a party and you work for a party and you're trying to work within the structure to moderate the party, I think that's the correct thing to do.

But parties change. Look here, Ronald Reagan changed parties. Winston Churchill changed parties. Phil Graham, Dick Shelby. It's not so unusual. And in my case, I think there was good provocation to do it, and I think it was the right thing.

MATTHEWS: Well, you're starting with the heavy weights. I can't argue with you about Churchill. He did it twice. In fact, he said he switched to liberal and then back to Tory. He said anybody can rat. It takes somebody special to re-rat. OK, you got me there. I love Churchill.

Let me ask you, what is the fight about between you-it isn't just going to be about this Mickey Mouse who had the most absentees, is it? Is that going to be the vote, how many absences the other guy had, or is it going to be about policy?

SPECTER: Well, I have a very strong record, Chris, on matters which have traditionally been on the liberal side. I heard Mr. Toomey a few minutes ago. He called me an out and out liberal again and again and again. The AFL-CIO endorsed my candidacy. Only Republican to get it.

So it's a matter of who can do more. Look here, in August, I'm bringing in the secretary of veterans affairs to Pennsylvania, to Philadelphia and to Pittsburgh, to look at what's going on and to give better care.

I'm bringing in the secretary of transportation, Ray Lahood. I'm trying to get a train from Center City to Redding, to take pressure off the expressway.

The experience I have had with Sotomayor I think showed, in the questioning that I have on her-and I was critical of her in not answering questions, and got into the Bork hearings, on the myth that Bork was Borked (ph) on a verb. And my background and my experience, I can do a lot more for Pennsylvania than my opponent.

MATTHEWS: Well, I'm with you on Bork, by the way, for what it's worth. I think you were right about Bork. Let me ask you about this question. You voted for McCain last time, but the president of the United States now, of course, is Barack Obama. And you support him now because of what he had to do on the stimulus package. You made that clear.

Isn't it ironic that he's going to come in and campaign for you in a primary against Joe Sestak, who voted for him?

SPECTER: Well, I think it makes sense, because when I cast the vote for the stimulus package, along with the two senators from Maine, that was decisive. And President Obama called me to thank me for it, and all of this time Biden was saying, you really ought to be a Democrat. And as soon as I made the change, he invited me to the White House the next day and endorsed me.

Now, that's-he's the leader of the party. But I think when President Obama endorses me, he's a pragmatist. And what happened last year, my vote didn't defeat him. I didn't expect it to defeat him. My vote for the stimulus package made his program come into effect.

MATTHEWS: It sure did. Let me ask you, senator, you have been in the Senate for 30 years. You have had no real problems. You have been re-elected, renominated rather easily. This race you're at least I think a 50/50 shot. Everybody knows it's a tough race coming. It's a very evenly divided state. Is this your last term, for 36 years? Will that be enough for Arlen Specter as U.S. senator?

SPECTER: I think it would be pretty tough to run again. But I believe with Churchill on never say never. But Chris-Chris, you're not right that I've had tough elections. In 1992, the year of the woman, I won by 2.7 percent. I won a primary by 1.25 percent. I was elected against Flaherty in 1980 by three percent.

I'm the only Republican-I broke the string of Democratic victories in Philadelphia, as you know. You were-

MATTHEWS: I know all about you, sir. I voted for you back in '67 for mayor. Look, senator, I was trying to be nice. I'm sorry I said these were easy races. You've had tough races. You look good. You're going to be tough to beat. Senator Arlen Specter, Democrat.

SPECTER: I feel good.

MATTHEWS: After all these years.

SPECTER: I'm on the top of my game.

MATTHEWS: I know that's your line.

SPECTER: I started off as a JFK Democrat. The Democrats wouldn't take me for DA. The Republicans asked me to run. I kept my registration as a Democrat. Now I'm back, and in full swing, Chris.

MATTHEWS: Forget James Cromlisch (ph), only one guy to remember.

Thank you very much, Senator Arlen Specter, a once and current Democratic.

Up next, we'll talk to US Congressman Joe Sestak, who is a Democrat forever, I guess, who is challenging Specter in the primary. You're watching HARDBALL, the HARDBALL primary, the first one in the country, in Pennsylvania, on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. Now with the newest candidate from Pennsylvania, the Democrat who has just challenged Senator Specter, Congressman Joe Sestak. Congressman, admiral, let me ask you this: Specter just hit you with the fact that you're traveling around the state on taxpayer-financed whatever. What's he talking about?

REP. JOE SESTAK (D), PENNSYLVANIA: I don't know. And I really don't.

But look, anyone-

MATTHEWS: Was your gas paid for by the government?

SESTAK: No.

MATTHEWS: What does he mean, then?

SESTAK: I'm sure Arlen didn't mean to misspeak. His staff probably misinformed him. No, this is obviously from campaign money. I just think he was misinformed.

MATTHEWS: What about missing all those votes? He puts out a blog site everyday showing when you do "THE ED SHOW," when you do local television. Every time you miss a vote because you're on TV, he's got it on his blog site. What do you make of that?

SESTAK: Ed-I mean, Chris, you know we keep our office open seven days a week. In our district, we've handled just under 10,000 constituency cases in the first two years, three times the normal Congressional office. In Washington, D.C., we've actually passed more bills this year than either senator of Pennsylvania, co-sponsored more bills than any other representative except four.

And finally, we move for the first time in 12 years money into autism. It's an epidemic throughout this nation. And we have the very first bill in 17 years pass the House of Representatives that took care of elder abuse, because Pennsylvania, where I have been to all 67 counties in three weeks in July, has an increase of 36 percent in elder abuse.

We work hard every day, Chris, and you know that. And that's what matters, because when I went to those 67 counties, some of those counties when I asked them how the recession was, as a result of the last eight years, said, it's not that bad. We were hurting so much anyway.

Washington never kept the middle class, the working families, in mind.

That's why I'm running.

MATTHEWS: Congressman, I want to salute you for running. I think Pennsylvanians deserve a choice. I grew up there. I think democracy means a choice, and I think that's great.

Let me ask you about the president, the former president. He went to North Korea, to rescue those two young journalists. He did a heroic job doing that. Will he come to Pennsylvania, if he can go to Pyongyang-can he come to Pennsylvania for a guy who supported the Clintons, who worked for the Clintons in the National Security Council? Does the president, the former president, give you any commitment he'll come in and work for you?

Barack Obama, who you voted for, is going up there and campaigning for Arlen Specter, who voted for John McCain and Sarah Palin. I know this is ironic. Will you get the Clintons at least in for you?

SESTAK: I would never ask president Clinton to come in for me at all.

MATTHEWS: Why?

SESTAK: Here's why. When I worked for president Clinton, I recognized that there's the president and then there's the office of the presidency. And although he is a former president, he's still attached to the office of the presidency. Even to begin to think that I would ever place someone I work for into a place of potential embarrassment with the present president, I would never do that.

There's not only loyalty down, there's loyalty up. I would not do that because I respect that office of the presidency. Besides, I really do like running alone. I've yet to have anyone ask me who's endorsed you or who do you know. They want to know what I'm going to do for them and will I be there for them tomorrow.

MATTHEWS: I watched the Clintons campaign for Barack Obama. And they did a hell of a job for him last time. I wonder why you see there's a conflict, why the Clintons don't owe you-not owe you, but feel they should help a guy who's been so loyal to them, working for them, always being a Hillary Clinton person, always being a Bill Clinton person. It seems-I'm not going to ask anymore because you said you think it's a conflict.

SESTAK: If I could answer that-if I could, though, is I didn't do that because I wanted something back. I did that because I believed in Mrs. Clinton, as I believe in President Obama today.

Look, I understand President Obama. It's tough down there. He probably just wanted the insurance of an extra vote. But that's for 2009. We Pennsylvanians have to worry about 2010 through 2016. We need new ideas and new energy.

Going around these 67 counties in three weeks, I have to tell you, somebody in Washington, D.C. forgot about them, or else we wouldn't have need an economic stimulus bill.

MATTHEWS: Your trouble is that you're traveling around this state to 67 counties, and nobody knows until you tell us. Arlen Specter's going to spend 30 million dollars in TV advertising to croak you. What can you do about it?

SESTAK: Look, I'll have more than sufficient money in order to get my message out. But I have to tell you-and you know us Pennsylvanians because you're one of us. This is where the Whiskey Rebellion began. We're pretty independent-minded. Nobody is asking us who endorsed you, who do you know. They want to know, are you going to work for us. And I'm going to work for them.

MATTHEWS: I salute you. I salute your guts in making this race a real race for the people of Pennsylvania.

SESTAK: Thanks.

MATTHEWS: Thank you, Congressman Joe Sestak. Right now it's time for "THE ED SHOW" with Ed Schultz.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

END

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