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updated 12/31/2009 11:54:29 AM ET 2009-12-31T16:54:29

Guests: Matt Nesto, Charlie Cook, Sen. Bernie Sanders, Sen. Paul Kirk, Todd Harris, Steve McMahon, Ron Brownstein, Melinda Henneberger, David Corn

CHRIS MATTHEWS, HOST:  Was Scrooge a Republican?

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews in Washington.  Before we get started tonight, let me tell you a story.  It‘s a good story about how this country of ours is supposed to work.  In 1980, Ronald Reagan was elected president.  He promised big change and he came into office ready to make change.  The Democrats, who had lost the election, opposed him in Congress but they didn‘t obstruct him.  They didn‘t threaten to keep the Senate in session right up until Christmas Eve.  The Speaker of the House, Thomas P.  “Tip” O‘Neill, who I was working for at the time, believed the voters had made their decision and figured the man they elected had a right to his turn at bat.

In 2008, Barack Obama ran for president promising big change.  He told the voters he‘d be a transformative president.  He promised us one big thing, health care reform.  Just like Reagan, he had made it clear in his appeal to the voters that when he came into office, he was going to deliver what he promised, the change he had promised.

What‘s been different this time?  It‘s been the decision by the opposition, this time the Republicans, to use every parliamentary maneuver to stop the new president from doing what he promised the American people he would do, what they elected him knowing he intended to do.

To his historic credit, Speaker O‘Neill ended up bouncing off the extremes of Reagan‘s policies.  The Democrats ended up picking 26 seats in that ‘82 election.  He and President Reagan teamed up to save Social Security in ‘83 and to pass a much respected tax reform bill in ‘86 that cut rates and plugged loopholes.  Tip O‘Neill retired, by the way, in 1986 with a job approval rating of 67 percent.  Ronald Reagan didn‘t do much worse.  But ironically, their tough debate made both leaders look better.  By each doing their job, by accepting majority rule, by displaying mutual respect and without obstruction, they made America better.

We start tonight with this cranky, clanky conduct in the United States Senate on health care.  Senator Bernie Sanders is an independent from Vermont.  Senator Sanders, what do you make of the Republican Party this year and the way they‘ve chosen to use their prerogatives?

SEN. BERNIE SANDERS (D-VT), BUDGET COMMITTEE:  I think it‘s really sad.  You know, these guys had eight years to do something about health care, and under their watch, under Bush‘s watch, seven million more people lost their health insurance and premiums soared, all right?  They did nothing when they had control.  And now, because some of us are trying to go forward and make sure that 30 million more people have insurance—we‘ve got some insurance reform, disease prevention, community health centers—they‘re obstructing in a way that nobody has seen around here in decades.

I introduced a Medicare-for-all single-payer bill.  It was going to lose, Chris, maybe five votes, maybe ten votes.  They wanted to read 700 pages of that bill and just obstruct any kind of progress that we‘re making.

MATTHEWS:  Knowing that that was a long shot to begin with, just to raise hell, just to have fun?

SANDERS:  Right.  Absolutely.  Well, also to make sure that we slow down things.  They have broken the all-time world‘s record for filibusters, as well as for other dilatory practices.  It‘s never been done the way they have done it.  And it‘s very clear they‘ve got nothing to offer, and then what they want to say—if they prevent Obama or the Democratic leadership from accomplishing anything, then they‘ll go to the public and say, What did these guys accomplish?

MATTHEWS:  Yes.

SANDERS:  That‘s very clearly what their purpose is, and I think it‘s pretty pathetic.  And your point is right, you know, Tip O‘Neill worked with Reagan.  Reagan won the election.  Well, these guys don‘t like it.  Obama won the election.  Work with him.

MATTHEWS:  OK, let‘s listen to one of your Democratic colleagues from Rhode Island.  This is Sheldon Whitehouse on Sunday.  I think he makes a somewhat different point, but it makes the same sort of bottom line.  Let‘s listen.

(BEGIN VIDEO CLIP)

SEN. SHELDON WHITEHOUSE (D), RHODE ISLAND:  The birthers, the fanatics, the people running around in right-wing militias and Aryan support groups—it is unbearable to them that President Barack Obama should exist.

(END VIDEO CLIP)

MATTHEWS:  How much of that is that deep-seated ideology, almost nativist—maybe it is nativist—ideology on the far right that‘s energizing this obstructionism?  What do you think is the connection?

SANDERS:  Well, there‘s no question that you have a very strong, extreme right-wing effort in this country that, to the degree that they‘re, quote, unquote, “birthers,” they don‘t believe that Obama even should be in the White House.  And it is very clear to me that that base is doing everything they can to make sure that Obama does not succeed.  And I think that that is really a bad news situation for this country.

Look, in terms of this health care bill, Chris, I‘m not going to tell you it‘s the greatest thing in the world.  I believe in a Medicare-for-all single-payer bill.  A lot in this bill—I think we should have a strong public option.  There are other components of this bill that I don‘t like.

But you know what?  At the end of the day, just doing community health care centers, you‘re going to have 25 million more people who have access to primary health care...

MATTHEWS:  Yes.

SANDERS:  ... 20,000 new primary health care doctors and dentists that we desperately need, 30 million more people getting insurance, all right?  It is not the end of the world.  We‘ve got to—the day after this is passed, we‘ve got to improve it.  But to simply try to kill this bill and leave 45,000 people every single year dying, that to me is just not acceptable.

MATTHEWS:  Let‘s take a listen to another one of your colleagues.  This is Max Baucus, the chairman of the Finance Committee, late this afternoon.  Senator, I want you to respond to what you hear on this tape.

(BEGIN VIDEO CLIP)

SEN. MAX BAUCUS (D-MT), FINANCE COMMITTEE CHAIRMAN:  It is disrespectful, it is unseemly for senators in this body to invoke the names of Ted Kennedy and Jack Kennedy in opposition to this bill.  It is disrespectful and unseemly.  And I frankly am very much surprised that senators would go to that level and try and invoke the names of Ted Kennedy and Jack Kennedy to—in opposition to this legislation.

(END VIDEO CLIP)

MATTHEWS:  I‘ve heard, Senator, that Republican leadership is trolling around, their whips are looking for a Democrat who will be a, quote, “profile in courage,” close quote, and obstruct the bill at the very end.  Have you heard that story?

SANDERS:  Yes, but they ain‘t going to find it.  In fact, in the Democratic cloakroom, there is a photograph of Kennedy saying, “Let‘s get it done.”

MATTHEWS:  Wow.

SANDERS:  Ted Kennedy—you know that.  Ted Kennedy more than any

person in our lifetimes has been a fighter for universal health care.  Very

he developed this community health center concept that we‘re expanding right now.  So to use Ted Kennedy against this bill when he was the chairman of the Health, Education Committee that helped develop this legislation, that‘s an oxymoron.  That is just really not a good thing to do.

MATTHEWS:  Well, to reach back to one of our heroes from the past, from the ‘60s, Saul Alinsky once said that even though both sides have flaws in their arguments and you can always find something nuanced about your own side you don‘t like and it‘s never perfect, you have to act in the end like there‘s simple black and white clarity between your side and the other side or you don‘t get anything done.  I always try to remind myself of Saul Alinsky when I get confused.

But congratulations to you, sir.  You weren‘t confused in these last couple days.  Thank you some much for...

SANDERS:  Thanks very much, Chris.

MATTHEWS:  Have a happy holiday season.

SANDERS:  You, too.

MATTHEWS:  ... for the rest of the next couple weeks.  Anyway, Senator Sanders, thank you.

Let‘s bring in Senator Paul Kirk—well, this has been a hard guy to

talk about a fishing trip we‘ve been on for months trying to bring this guy into the show.  Paul Kirk, United States senator, the honorable senator from the Commonwealth of Massachusetts, the Bay State, the junior senator.

Congratulations on being here.  And I never thought I‘d be calling you Senator, but maybe I should have been a long time ago.  What is it like being Ted Kennedy‘s long-time aide and troubleshooter and field guy, and political consiglieri in many ways, and then coming in and filling his shoes now in these very almost sacred moments when you have a real shot at getting a health care bill?

SEN. PAUL KIRK (D), MASSACHUSETTS:  Thanks, Chris.  It‘s great to talk with you.  First of all, I accepted this honor with a healthy dose of humility.  And to be here after having been Senator Kennedy‘s close friend and to accept this appointment at the urging of his family, you know, it‘s the greatest honor I could ever expect to receive.

But to be here at this historic time, where 40 years ago this week, Senator Kennedy gave his first speech advocating universal national health insurance for all Americans, and to be here 40 years later, at a time when this bill will be passed and to be, as I was the other night, on the cloture vote, to give an aye vote, I‘m sure just like a member of his family would feel that, on the one hand, how delighted and joyed (ph) Senator Kennedy would be at this coming close to the culmination of the legislative program that was at the top of his agenda for almost 50 years, and on the other side, the sadness that he wasn‘t here to cast that vote himself.  So it‘s a lot of a kind of emotional turmoil, if you will.  But at the end of the day...

MATTHEWS:  What do you make of this fight—what do you make of this fight, Senator, between the liberal side—and I don‘t mind the word liberal.  Some people do.  But let‘s just call it what it is, the liberal side of this fight, the Senator Kennedy fight for national health insurance that he‘s been fighting for, as you say, for 40 years, and those who find a problem with this bill because it doesn‘t have the public option, it doesn‘t have the buy-in to Medicare at 55?  What do you make of that fight?  How does this fit into this continuum?

KIRK:  Well, that was the fight single payers (ph) where Senator Kennedy spoke of 40 years ago.  But the reason he goes down in history as the greatest legislator of perhaps all time was his understanding that the Democratic Party is a diverse party.  There are a lot of different constituencies.  And he perfected, as did Speaker O‘Neill, to whom you referred earlier and for whom you worked, the art of compromise and coming to a good result with the understanding that it‘s not the final answer.

Bills of this complexity will be amended and perfected as they go on.  But this was a bill of which he would have been proud and would have voted himself.  I have absolutely no doubt about it.

MATTHEWS:  Let me—do you recall the speech that Senator Kennedy gave at the Democratic convention in 1980, as he concluded...

KIRK:  Yes, I...

MATTHEWS:  I‘m kidding because, obviously, it‘s been in your soul ever since.

KIRK:  Right.

MATTHEWS:  He said, “The work goes on, the cause endures, the hope still lives.”  If this bill gets signed, as you see it now, as a legislator yourself, will that fulfill the work, the cause and the hope of Ted Kennedy?

KIRK:  Well, yes.  I would say it will.  But the other thing is, as I mentioned earlier, he would want this bill to be improved and made, as any complex piece of legislation is, better suited to all the people in the United States of America.  It was like the Civil Rights bill.  We had three versions of it, and we still have to perfect equal justice under the laws in this country.

MATTHEWS:  Yes.

KIRK:  So the challenge goes on, but the hope endures.  And just as you said, there‘ll be work ahead, but it will be part of his legacy.

MATTHEWS:  Wow.  Thank you very much, Senator Paul Kirk of Massachusetts.  Thanks for coming on HARDBALL.

KIRK:  Thank you, Chris.

MATTHEWS:  It was worth the effort, and it was an effort.  Thank you for coming on.

(LAUGHTER)

KIRK:  Thank you.

MATTHEWS:  Coming up: RNC chairman Michael Steele—boy, does he have a strange lingo.  He says Democrats who are trying to pass the health care bill are, quote, “flipping a bird” at the American people.  Oh, well, we‘ll talk about that sort of interesting use of the language.

The Democratic congressman Parker Griffith, by the way, of Alabama has switched sides.  He‘s going over to the Republican side, the way Arlen Specter went the other way.  What‘s this switching all about?  Are these guys all going to hold onto their seats after they switch parties?  The HARDBALL strategists are going to be here to debate that little hot one.  Shouldn‘t you stay in the seat you‘re elected to by one party?  And you‘ve got money from the one party and then you hang onto the seat and the money and everything else, even though you flip sides?

Come back and watch MSNBC in one minute.  We‘ll get to it.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Big news today as a freshman Democratic congressman from Alabama announces he‘s leaving his party to become a Republican.  How do both sides spin that baby?  It‘s a question for the strategists.  Steve McMahon is a Democratic strategist, Todd Harris is a Republican strategist.

Steve, are they—are the rats leaving the ship, or what‘s going on? 

Is the ship sinking?  Why are Democrats switching to Republican?  What is -

I hear more are coming, by the way.  What‘s going on here?  People don‘t leave happy ships.

STEVE MCMAHON, DEMOCRATIC STRATEGIST:  First of all, the Republicans are sort of falling in line, is what‘s really going on here.  Look, Parker Griffith—anybody with two last names should be a Republican to begin with.

MATTHEWS:  OK, everybody down South...

MCMAHON:  Parker Griffith voted...

MATTHEWS:  ... is going to be happy to hear this.  Go ahead.

MCMAHON:  Parker Griffith—Parker Griffith voted against the stimulus.  He voted against health care reform.  He voted—he‘s voted pretty consistently with the Republicans.  So basically, what Parker Griffith did today was he returned home to the Republican Party.  And it‘s interesting because the Republican...

MATTHEWS:  So are you saying that anybody who‘s not a liberal ought to be a Republican?

MCMAHON:  They want to primary him.

(CROSSTALK)

MCMAHON:  No, no, no, no.  I‘m not saying that at all, Chris.  In fact...

MATTHEWS:  It looks like, Todd—Todd, it looks like he‘s yielding to you all the moderates and conservatives in his party.  That‘s the thought (ph).

TODD HARRIS, REPUBLICAN STRATEGIST:  Yes, well...

MATTHEWS:  Seems to me he‘s saying...

(CROSSTALK)

MCMAHON:  No, Chris, I‘m not.  That—no, I‘m not.

(CROSSTALK)

MCMAHON:  I‘m sorry to interrupt, but I‘m not at all.  He voted against every single Democratic priority.  It‘s OK to—you know, it‘s OK to say we need to be more moderate or we need to change the health care reform bill to make it something that works for people in Blue Dog districts.  But this is somebody who consistently voted with the Republicans, who said he wouldn‘t vote for Nancy Pelosi to be Speaker of the House.  He‘s not a Democrat, hasn‘t been for quite a while.

MATTHEWS:  So he didn‘t vote for Pelosi?  He didn‘t even vote for Pelosi, you‘re saying?

MCMAHON:  No.

(CROSSTALK)

MCMAHON:  ... Speaker Pelosi next time.

MATTHEWS:  Oh, next time.

MCMAHON:  Yes, next time.

MATTHEWS:  But you didn‘t, Nah, nah, nah like this when he voted for her the first time, did you?

MCMAHON:  No, I didn‘t, Chris.  You‘re right.

(CROSSTALK)

MATTHEWS:  So you didn‘t mind that vote, did you.  OK, Todd, so he liked the vote when he got one for Pelosi.  He doesn‘t like it now that the guy‘s gone.  Your thought—are you building the right kind of Republican Party, or are you building a party off the discards of the Democrats?  Are you going to keep building your party with Dixiecrats, ex-Democrats who think the Democratic Party‘s too mainstream?

(CROSSTALK)

MATTHEWS:  ... since the ‘60s.  Since the ‘60s...

HARRIS:  Well, we‘re happy to take...

MATTHEWS:  ... you‘ve built a political party—the party of Lincoln‘s become the party of, I don‘t know, probably the party of the Confederacy.  Go ahead.

HARRIS:  Oh, please.  We‘re happy to take any former Democrat who wants to switch over because they don‘t like the runaway spending in Washington, they don‘t like this out-of-control government health care experiment.

This just validates exactly what we talked about on this show last week, Chris, that there are more than 80 Democrats, incumbent House Democrats, who are in seats that were carried by either McCain or Bush.  And as the Republican Party succeeds in tying Harry Reid and Nancy Pelosi around all of their necks, it‘s going to make their reelection chances more and more difficult.

Now, if they want to do away with the election altogether and just switch over and be Republicans, we‘re more than happy to have them.  But I have to tell you, Chris, a lot of those seats—these are not all Southerners.  A lot of those seats are in the Midwest, they‘re in the mountain West, and those Democrats that represent conservative districts...

MATTHEWS:  OK, Todd...

HARRIS:  ... we‘re more than happy to have them.

MATTHEWS:  Todd, I‘m going to...

HARRIS:  Chris?

MATTHEWS:  I‘m going to let you have all the time you want.  Name one elected congressman or senator from above the Mason-Dixon line who‘s ever switched from D to R.

HARRIS:  Well, the...

MATTHEWS:  All the time in the world.

HARRIS:  I‘d have to back and...

MATTHEWS:  Give you all the time in the world.  Just give me one. 

Anytime in history.  Anytime.

HARRIS:  Well...

MATTHEWS:  Just one.

HARRIS:  I don‘t know how many have switched—I don‘t know how many have switched...

MATTHEWS:  Just name one!

HARRIS:  ... but I can tell you that there are a—I can tell you there are lot that are going to be knocked off in 2010 if they don‘t switch sooner.  I‘ll tell you that much.

MATTHEWS:  OK.  You have a loss for words because there aren‘t any.  Anyway, let‘s take a look at a new Quinnipiac poll.  You‘ll like this one, Todd.  “From what you‘ve heard”—this is the poll question—“or read about the health care reform under consideration now, do you mostly approve or disapprove the results?”  Thirty-six percent mostly approve.  Fifty-three percent mostly disapprove.  And catch this.  Thirty-eight percent of the people, far less than half, approve the job President Obama is doing with this.  Fifty-six percent disapprove.

Now, these are pretty bad numbers, aren‘t they, Steve?

MCMAHON:  Well, I mean, obviously, you would like the numbers to be a little bit better. 

But let‘s just go back for a second, if we could, to what President Obama inherited, what he inherited, what George W. Bush left him, and—and left him a huge economic mess, which he had to first clean up and wade through....

(CROSSTALK)

MATTHEWS:  He didn‘t leave him a health care bill.  He didn‘t leave him this health care bill. 

MCMAHON:  No, I know.  But hold on a second.  Hold on. 

(LAUGHTER)

MCMAHON:  No, he didn‘t.  But you know what?  President Obama had said a number of times he didn‘t run for president and he didn‘t get elected president in order to bail out big banks and take care of Wall Street.  But that‘s what he had to do to save the financial system. 

He used political equity.  And now he‘s doing what he...

(CROSSTALK)

MATTHEWS:  Steve, we have had about 24 inches of—Steve, we have had about 24 inches of snow in D.C. this week.  Is that—is that George Bush‘s fault? 

(LAUGHTER)

MCMAHON:  Yes, it is, absolutely. 

MATTHEWS:  I thought you would say that.

(CROSSTALK)

MATTHEWS:  Todd, your reaction to the—go ahead.  Your thoughts.

TODD HARRIS, REPUBLICAN STRATEGIST:  Hold on.  While I have been sitting here, I have been racking my brain.

Ben Nighthorse Campbell, former senator from Colorado, switched from the Democratic to the Republican Party.  But back to this poll.

MATTHEWS:  What geography are you in?  Is that above the Mason-Dixon Line?  I don‘t think it‘s even along—it‘s even covered by the Mason-Dixon Line in Colorado.

(CROSSTALK)

HARRIS:  Colorado is definitely Yankee country, I can tell you. 

(CROSSTALK)

MATTHEWS:  You are so off-base. 

HARRIS:  No.

MATTHEWS:  What about this guy, your party chairman, saying flipping the bird?  I thought this guy had—well, does that show any class?  Flipping the bird, what is this, high school Harry?  What kind of talk is that? 

(CROSSTALK) 

MATTHEWS:  Quote—this is Michael Steele, the chairman of the Republican Party.  Let‘s hear it.  Here he is, your guy, your boss. 

(BEGIN AUDIO CLIP)

MICHAEL STEELE, CHAIRMAN, REPUBLICAN NATIONAL COMMITTEE:  I mean, it just annoys and irritates me on something so fundamentally important, that this Congress, this leadership, is so tone-deaf and so hell-bent on propping up a policy that the American people doesn‘t want, that they‘re willing to basically flip the bird to the American people on this issue, and slip it in the dead of night. 

(END AUDIO CLIP) 

MATTHEWS:  Whoa. 

HARRIS:  Well, let me—let me—let me say two things about this. 

Number one, I actually agree with him.  I think, when a majority of the American people say they absolutely don‘t want this and it‘s getting shoved down their throats, you know, I agree with what the chairman is saying. 

But, secondly, how is it possible that you find outrage in this, but when Senator Brown of Ohio compares Republicans to Aryan white supremacists, you don‘t think that that‘s out of line?  That is what we ought to be condemning right now. 

If Chairman Steele wants to say Democrats are flipping the bird, and they will use that language to raise some money, then I think that‘s great for the Republican Party, because it‘s accurate. 

But for Senator Brown to stand up and say—and compare Republicans who are opposed to health care reform as white supremacists, that is outrageous. 

MATTHEWS:  Well, let the white supremacists speak for themselves. 

(CROSSTALK)

MATTHEWS:  Your thoughts, Steve? 

MCMAHON:  I think Todd just changed the subject. 

Listen, I think what Democrats should do is, they should offer to pay Michael Steele‘s travel all around the country, and they should invite him to give speeches.  Of course, they shouldn‘t—they shouldn‘t pay him for the speeches, because that‘s not appropriate for a party chairman to be giving speeches for pay. 

But they should send him around the country, because every time he does this, people wonder what the heck he‘s doing there. 

MATTHEWS:  Let me ask you, Todd, about this obstructionism, which I have been railing against tonight.  And I do think it‘s a bipartisan assessment. 

Why, if you have an election, and the American people choose one party over the other, one candidate in this case, Barack Obama, and his party, as they did Ronald Reagan back in 1980 -- and Reagan had his shot.  He got his health—in his case, big tax cuts, big spending changes, defense increases, other cuts.  He got basically what he wanted because the Democrats gave him his schedule. 

Tip O‘Neill, my old boss, said, you won.  It‘s your turn at bat.  We will get back at you later.  We will let the American people judge your failure or success. 

Your party this time says, no, we don‘t want to see whether health care under Barack Obama works or not.  We want to stop the Senate from functioning.  So, we‘re going to force every procedural trick we can up until Christmas Eve, 8:00 in the morning, and hope that something will break our way. 

Do you think that‘s democracy in action, Todd Harris? 

HARRIS:  Well, there are two points. 

Number one, as you yourself said, Reagan was willing to work with Tip O‘Neill and work with Democrats in Congress.  The Obama administration has shown zero interest in working with Republicans, whether it‘s the health care bill, the stimulus package, any of this. 

Number two, Chris, as you well know, there are Republicans who feel very, very deeply about health care reform, senators like Grassley, Enzi of Wyoming.  One by one, as these guys were negotiating with the Democrats, they were all jettisoned, because the Democrats weren‘t willing to take any of the Republican proposals into consideration. 

MATTHEWS:  Right. 

HARRIS:  So, when the Democrats shut Republicans out of the entire negotiating process, they shouldn‘t then at the end of it say, well, how dare you not support what we have put together, how dare you not be bipartisan.

Maybe if they were more bipartisan in the beginning, we wouldn‘t have this problem now. 

MATTHEWS:  Steve, your answer? 

MCMAHON:  Todd, Todd, one of the reasons that this health care—one of the reasons this health care bill took 11 months to negotiate is because Barack Obama and the Democrats tried so hard to get the party of no engaged on this issue. 

And they went—they went to great lengths to get Mike Enzi and Chuck Grassley and Olympia Snowe and Susan Collins and others.  And those people at the end of the day joined the Republican Party in the chorus of no, not so fast, not so much, not right now, not my problem, not going to do it. 

And that‘s basically been what the Republican Party has offered the American people for this entire year.  And you look at the Quinnipiac poll which we were talking about a little bit ago, and who do Americans trust more on the economy, on health care, on just about every issue?  Barack Obama is trusted more than the Republicans. 

So, we can sit there and crow and say, well, geez, these numbers aren‘t very good.  And, frankly, if I were in the White House, I would be concerned by these numbers.  But they‘re a hell of a lot better than the Republican numbers are, even still, even today, even after everything this president has had to undo, redo, and fix, thanks to what George Bush left this country. 

HARRIS:  Well...

(CROSSTALK)

MATTHEWS:  OK.  You guys can get back at it again next week.  We are going to take a break for Christmas.

In this case, we do take a break for Christmas, unlike the U.S.

Senate. 

Steve McMahon, merry Christmas.

Todd Harris, merry Christmas to you. 

HARRIS:  Merry Christmas to you both.

(CROSSTALK)

MATTHEWS:  Up next: political theater, a senator‘s version of “The Night Before Christmas.”  Wait until you catch Roland Burris doing a little poetry written by his speechwriter.  He says so.  That‘s in the “Sideshow.”

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATTHEWS:  Back to HARDBALL.  Time for the “Sideshow.” 

First up: crank calls from high places.  Today, outgoing Governor Tim Kaine of Virginia held his last ask the governor show on a local radio station.  A fellow calling himself Barry was calling in.  Let‘s listen, and let‘s watch. 

(BEGIN AUDIO CLIP)

UNIDENTIFIED MALE:  Let‘s get back to the phones...

GOV. TIM KAINE (D-VA), CHAIRMAN, DEMOCRATIC NATIONAL COMMITTEE: 

Great.

UNIDENTIFIED MALE:  ... and let some callers—we have Barry from D.C. is calling. 

Go ahead, Barry. 

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  Well, Governor Kaine, this is actually the president of the United States calling. 

(LAUGHTER)

KAINE:  No.  Oh, my gosh.

OBAMA:  I have questions about—about traffic in Northern Virginia. 

KAINE:  Oh. 

OBAMA:  But, rather than go there, I just wanted to say how proud we are of your service as governor of the Commonwealth of Virginia. 

(END AUDIO CLIP)

MATTHEWS:  By the way, traffic is real down there, three hours trying to get into the Redskins game last night. 

Anyway, Kaine, if you will recall, helped deliver Virginia for Obama in both the primary against Hillary Clinton and in the general election against military man John McCain, which is tough in Virginia.  He also heads up the Democratic Party nationally right now.  For that, you get a president call-in three days before Christmas. 

Next: political theater of a different sort.  Without further ado, Roland Burris, Democratic senator from Illinois, with this morning‘s version of “The Night Before Christmas.” 

(BEGIN VIDEO CLIP)

SEN. ROLAND BURRIS (D), ILLINOIS:  It was the night before Christmas.  ‘Twas was the night before Christmas. and all through the Senate, the right held up our health care bill, no matter what was in it.  The people had voted.  They mandated reform, but Republicans blew off the gathering storm. 

We‘ll clog up the Senate, they cried with a grin.  And in the midterm elections, we will get voted in. 

(END VIDEO CLIP)

MATTHEWS:  Wow.  Senator Burris‘ verse was the work of his speechwriter, a fact we know now because someone in the senator‘s office thought someone had to take credit for that.  Maybe they didn‘t want us to think that a U.S. senator like Burris has enough time on his hands to write it. 

Anyway, as you just heard, December 24, 8:00 a.m., the morning of Christmas Eve, is when the big United States Senate vote on health care is expected to take place, 8:00 a.m. Christmas Eve, which brings us to tonight‘s “Big Number.” 

To get a sense of how historic this is, when was last time the Senate was in session on Christmas Eve? -- 1963.  A month after Jack Kennedy was killed, the Senate came in to approve a report on foreign aid appropriations, just months before the fatal Vietnam buildup, almost 50 years ago since the Senate has been in on Christmas Eve, 1963, tonight‘s “Big Number.” 

Wow.  That‘s pretty grim. 

Up next:  Of the Senate seats that are up for grabs in 2010, we are going to tell you the top five races to look for where a senator has a very good chance of losing his or her seat, their job, their career, the works. 

You‘re watching HARDBALL, only on MSNBC.  

(COMMERCIAL BREAK)

MATT NESTO, CNBC CORRESPONDENT:  I‘m Matt Nesto with your CNBC “Market Wrap.”

Wall Street continues its rally, helped by some good news on the housing front, the Dow Jones up 51, S&P up four points, and the Nasdaq the strongest of the three with a 15-point rally to 2253.

Market optimism rose today after the National Association of Realtors reported a 7.4 percent increase last month in sales of existing homes.  That‘s higher than analysts were looking for.  November sales were the strongest since the housing peaked almost three years ago, sales surge fueled in part by homebuyers taking advantage of the federal tax credit for first-time purchasers. 

And for the first time ever, Yahoo! closing its offices worldwide for a week.  The search engine giant is shutting its doors from Christmas through New Year‘s Day to cut costs. 

That‘s it from CNBC.  We‘re first in business worldwide—now back to

HARDBALL. 

MATTHEWS:  Welcome back to some pure fun -- 2010 has plenty of open U.S. Senate seats where both parties will be fighting to keep or to grab a seat.  Tonight, we‘re going to look at a handful of really tough races, the top five races where a U.S. senator might lose his or her seat easily. 

Ron Brownstein is the political director for Atlantic Media, and NBC News political analyst Charlie Cook is the editor and publisher of “The Cook Political Report,” two of the best guys in the business, probably the two best.

Let‘s start with the five senators in the biggest trouble.

Pennsylvania Republican turned Democrat Arlen Specter, Pollster.com has him basically slightly—well, they have got him ahead of Joe Sestak in the primary, but he‘s trailing Republican conservative Pat Toomey in the general. 

Charlie Cook, why is he in trouble? 

CHARLIE COOK, EDITOR & PUBLISHER, “THE COOK POLITICAL REPORT”:  Any incumbent that has got real opponents, in this case primary and general, who has been in Washington for a long time, is old, is part of—seen as part of the system...

MATTHEWS:  He‘s 80. 

(CROSSTALK)

COOK:  ... is going to be in serious, serious, serious trouble here. 

MATTHEWS:  Yes. 

(CROSSTALK)

MATTHEWS:  So, he meets all the concerns.  He‘s old.  He‘s been around a long time and he switched parties. 

(CROSSTALK)

COOK:  This is a change year. 

(CROSSTALK)

RON BROWNSTEIN, POLITICAL DIRECTOR, ATLANTIC MEDIA:  Yes.  Plus, he‘s a new transplant in the Democratic Party.  The roots are not real deep.

On the other hand, the Democratic Party I.D. registration—party registration advantage after 2008 is up to 1.2 million in Pennsylvania.  So, he has some assets that may not be apparent today.  But, nonetheless, Charlie‘s right.  I mean, it is...

(CROSSTALK)

MATTHEWS:  Why is he running even with a conservative guy who most people thought was beyond the mainstream in Pennsylvania a couple of years ago, Toomey? 

BROWNSTEIN:  And in fact may have trouble closing the deal in the end in the Philadelphia suburbs, which will be critical in this.

But, look, Democrats everywhere are in trouble right now.  We‘re talking about a right track back down in the mid-30s.  They are the party in power at a time when Americans are discontented over the direction of the country.  And the party in power is the one that takes the brunt of that gale.

COOK:  In a normal year, Pat Toomey couldn‘t win.  This kind of year, he could. 

MATTHEWS:  I agree with that.

Let‘s take a look at number four, Arkansas Democrat Blanche Lincoln.  She‘s been in the middle of the health care debate.  And she‘s got problems. 

I have always liked her when I met her.  I find her very likable, easygoing, nothing pompous about her.  Why is she in trouble? 

BROWNSTEIN:  Well, the big bell for Blanche Lincoln rang last November, when Barack Obama won only 39 percent of the vote.

And Arkansas...

MATTHEWS:  So, it‘s pattern voting. 

BROWNSTEIN:  It‘s pattern—look, where is Obama weakest?  He is weakest among older, blue-collar whites.  There are a lot of all of the people who fit that description in Arkansas. 

This is a more generic than personal problem, I think, for Blanche Lincoln. 

MATTHEWS:  OK, let‘s go to Colorado with Michael Bennet.  I knew his father.  I used to work for him on the Senate Budget Committee.  Michael was appointed, Bennet, to replace Ken Salazar when he went to Interior. 

What is that—why is that race tough? 

COOK:  Well, it‘s tough on two counts.  He got parachuted in.  He‘s never run for office before.  The governor picked him when other people thought he might...

(CROSSTALK)

MATTHEWS:  He was active in education matters... 

(CROSSTALK)

COOK:  He was—yes, he was the head of basically the Denver school system, very bright, very impressive guy.

MATTHEWS:  Right. 

COOK:  But he had never been a candidate, wasn‘t part of the establishment. 

The governor drops him in.  A lot of people thought that he was going to Wellington, the mayor of Denver, or someone else.  Now he‘s got the speaker of the house, Romanoff, running against him in the Democratic primary.  And then he‘s going to have a very formidable general election challenger, probably Gale Norton. 

MATTHEWS:  What about the fact that he refused to take any pork?

(CROSSTALK)

MATTHEWS:  He didn‘t demand any pork as a price to vote for the health care bill. 

BROWNSTEIN:  Yes.  Right.  And—and...

MATTHEWS:  And there‘s somebody out there screaming.  Does that sound ridiculous? 

BROWNSTEIN:  Well, actually...

MATTHEWS:  Do voters want pork? 

BROWNSTEIN:  Actually, he went out on the floor and condemned kind of back room dealing, again, trying to identify himself with the anti-Washington current that Charlie talked about.  Colorado has been trending blue since 2004.  But these are not big government Democrats.  It has been easier for Democrats to win in states like Colorado, reddish places, when Republicans were in power and they could play off of that, than it has been for them to run under the rubric of a Democratic president.  They lost ground in places like Colorado under Clinton. 

MATTHEWS:  Here‘s the race we‘ve got to talk about.  Here‘s a guy that a lot of people really like, but obviously he‘s getting blamed for a lot of the mess on Wall Street, and fairly so, I suppose some people would say.  Chris Dodd, somebody‘s got to take the heat for that screwup on Wall Street.  Is he going down?

BROWNSTEIN:  Charlie has described him as the most endangered incumbent, as endangered an incumbent as you can be. 

COOK:  Without being under indictment. 

BROWNSTEIN:  Without being under indictment. 

MATTHEWS:  Is it because he‘s chairman of banking?

BROWNSTEIN:  But, also he‘s had some ethics issues along the way, and he w as part of that general discontent.

MATTHEWS:  But if you got a break on a mortgage a couple years ago, people would say, great, good move.  Now it‘s considered treacherous. 

COOK:  It is.  And also, he‘s got—he‘s sort of—he‘s seen as sort of asleep at the switch while he was chairman of the committee.  All of these things kind of cropped up.  And he was doing things.  Normally, a Democratic senator in Connecticut would have no sort of problem whatsoever.  But he‘s become a poster child—

MATTHEWS:  Connecticut has a high IQ, the voters, highly educated, very sophisticate sophisticated.  Are they going to elect that wrestling woman?  Is she really going to be the senator from Connecticut?

BROWNSTEIN:  If she wins the primary against Rob Simmons, I would think that Dodd‘s odds—Dodd‘s prospects—

MATTHEWS:  She‘s going to drop 30 million of her own bucks.  Does that work with sophisticated voters?

BROWNSTEIN:  Some polls had her within range.  We don‘t know—

MATTHEWS:  Are voters that anger, Charlie, to elect a wrestling impresario to the United States Senate? 

COOK:  As opposed to Jesse Ventura as governor? 

MATTHEWS:  But this is Connecticut. 

COOK:  That was Minnesota. 

BROWNSTEIN:  That was Minnesota, yes. 

MATTHEWS:  Both smart states. 

COOK:  Yes, and a governor matters more than a senator. 

MATTHEWS:  You think she could beat him, Charlie? 

COOK:  I think Rob Simmons would be the more formidable candidate. 

MATTHEWS:  Let‘s take a look at this race that really amazes me.  Ross Baker, the great political scientist from Rutgers, said this guy deserves a profile in courage.  If health care gets through, it‘s because of Harry Reid.  Could he get health care through this Christmas and then lose? 

BROWNSTEIN:  Yes, he could lose.  But the one thing he‘s—he‘s in a state that‘s been a swing state.  He‘s never been an overwhelmingly popular politician in the state.  He‘s been more effective as more of a back room—

MATTHEWS:  They love him at Searchlight.

BROWNSTEIN:  He‘s been more effective as an operator inside the Senate than as a broad public figure.  One thing he has going for him is that, right now, I don‘t think either of these Republican candidates, the two front runners, Sue Loughton (ph), the former GOP leader, Danny Tarkanian, the son of -- 

MATTHEWS:  Tarkanian, I know that name.  His father was the coach for UNLV. 

BROWNSTEIN:  And he talks about—neither one of them is that formidable a candidate right now.  That would be the best chance Reid has with all the money. 

COOK:  She‘s really, really rich.  She can write the big checks, Sue Loughton. 

MATTHEWS:  She‘s the one running against Tarkanian. 

BROWNSTEIN:  I think Reid has better odds than Dodd.

MATTHEWS:  Who is the most vulnerable?  While you make your point, who‘s the most vulnerable Democratic senator? 

BROWNSTEIN:  I‘d say Dodd. 

COOK:  Dodd. 

MATTHEWS:  One thing to keep in mind, Chris—and I think Charlie would attest to this—in big years, in wave years, 1980, 1986, 1994, 2002, 2006, all the close Senate races went the same way.  In many ways, these guys are not entirely the captain of their faith.  There is a little bit of a swell there in the—

(CROSS TALK) 

MATTHEWS:  Can a Republican lose this year coming up?  Can a Republican incumbent lose any race anywhere next year? 

COOK:  I would not be surprised to see no Republican incumbent, House or Senate, lose. 

MATTHEWS:  How about a Democrat?  We‘ve got five vulnerable people here, Specter, Lincoln, Bennet, Dodd.  You say Dodd is the most vulnerable.  Who is the second-most vulnerable? 

COOK:  Reid—

BROWNSTEIN:  Reid or Lincoln.  Lincoln is in a situation where, again, it‘s more generic than personal.  This is a state kind of filled with the kind of voters that have been most resistance to the direction Obama is setting.  I think that‘s a real problem. 

I think Colorado‘s a real challenge, too, because Bennet is operating, to some extent, as the shadow of the governor, Bill Ritter, who has a very uneven first term, some successes, a lot of disappointments.  He could face a very—and Obama‘s approval there was dropping before the Fall. 

MATTHEWS:  Be coaches for a minute.  How do you coach a Democrat to win with a bad weather condition out there, where people don‘t like Obama right now? 

COOK:  Independence.  Stress your independence.  I look at each issue one at a time.  I‘d do what‘s right for the state.  I‘m independent.  Yes, I vote with my party when I think they‘re right.  I‘m against them when they‘re wrong.  Be able to list—

MATTHEWS:  How does Dodd make up for the fact that people, even Connecticut people, are ripped at Wall Street? 

COOK:  That‘s not his problem. 

MATTHEWS:  That‘s not his problem? 

COOK:  His problem is being a Democrat.  His problem is being Chris Dodd. 

BROWNSTEIN:  It‘s not my role to give advice to Democrats.  I think the most common argument you‘re going to hear, especially if there‘s any positive movement on the job front, is: do you want to go back.  Yes, things are difficult.  Yes, some of these decisions have been controversial.  But a vote for my opponent is a return to the policies that drove us to—

MATTHEWS:  You remember the great line, what‘d you do for me lately?  Pappy Chandler, what have you done for me lately?  Voters don‘t remember how bad it was.  They know how bad it is now. 

BROWNSTEIN:  I don‘t know.  The Democrats have been running against Herbert Hoover a long time.  You know, Republicans ran against the excesses of the Great Society under Nixon for a while.  So I don‘t know if looking back is completely wrong.  But I bet that is where a lot of this goes. 

MATTHEWS:  You know what Lee Atwater said?  Lee Atwater said that David is still getting good PR for beating Goliath.  Thanks, Ron Brownstein.  I don‘t know what that had to do with anything.  Charlie Cook, thank you.  Happy holidays. 

BROWNSTEIN:  Happy holidays to you. 

MATTHEWS:  Former New York City Mayor and former presidential candidate Rudy Giuliani has ruled out a run.  How many times can you announce you‘re not running?  How many times can you get news in the major newspaper like the “New York Times”?  Giuliani‘s done it again; he‘s gotten ink for not.  This  is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

RUDY GIULIANI, FMR. GOVERNOR OF NEW YORK:  After careful consideration, I decided that I would not be able to run for either the governorship or the Senate next year. 

This is not a decision not to run for anything else.  It‘s a decision purely about 2010, and what I can and cannot do in 2010. 

(END VIDEO CLIP)

MATTHEWS:  Wow.  That was former New York Mayor Rudy Giuliani, him turning it over to Rick Lazio.  We‘re back with the politics fix, with Melinda Henneberger, who is editor of chief of PoliticsDaily.com, and David Corn, the Washington bureau chief for “Mother Jones.” 

David, what is this Giuliani thing?  How many times can you not run and still get ink for it, publicity?  He‘s been not running since he ducked out of that Hillary race.

DAVID CORN, “MOTHER JONES”:  I think for the next five, ten years there are plenty of other races he will not run for. 

MATTHEWS:  That was in 2000.  That was nine years ago, almost ten years ago, and he‘s still not running. 

CORN:  He‘s still not running.  He had a choice of two races in 2010 that he‘s decided—listen, I think—in an ideal world, a guy—a concept like Rudy Giuliani would have a good case in New York State.  Now, I think he was really damaged by the presidential run. 

MATTHEWS:  He got one delegate.

CORN:  If that much.  He was damaged by the Bernie Kerik stuff. 

MATTHEWS:  Putting a guy up for Homeland Security that went to the pen, basically. 

CORN:  Yes.  Yes.  I still think there are some stories about his social life that may not play well up state. 

MATTHEWS:  You mean dueling press conferences with Donna Hanover?  All right, OK.  I‘ve always liked him because I loved the fact that New York was a lot safer after he was mayor, that first term especially.  For the first time in my life, I went up to New York with my kids, and I felt like this is a city i could wander around in.

CORN:  There was a high cost for that.

MATTHEWS:  -- without calculating every step in terms of personal safety. 

(CROSS TALK)

MATTHEWS:  Crown heights.  All I got to tell you is the word—two words, crown heights, which is the one time the neo-cons and I were on the same side.  OK?

MELINDA HENNEBERGER, POLITICSDAILY.COM:  The crack addicts died. 

That‘s why New York got better. 

MATTHEWS:  Right, but I gave Rudy credit for that.  You think this whole fight—let‘s talk about this kind of politics.  Pro-choice, are you dead in the Republican party now?  It seems like—

CORN:  Nationally—

MATTHEWS:  That was the killer for him. 

CORN:  If a guy like Rudy ran, they would have a hard time, the Tea Partiers, going after his on those kind of issues.  But generally that‘s true.  You can‘t be pro-choice.  You can‘t be pro-gay rights. You can‘t, I think, even be in the favor of the stimulus bill. 

MATTHEWS:  Doesn‘t he do a whole riff about how he lived with two gay guys, sitting around in the bath robe.  A liberal like you gets a big chuckle out of this. 

CORN:  The guy did more “SNL” appearances as a gay person.  He was always dressed—any chance—

(CROSS TALK)

CORN:  But I think for a Republican, there may be something wrong with that.  But any chance he got to put on woman‘s clothes, he seemed to jump at it. 

MATTHEWS:  He was really good in those female impersonation things he was doing on the air.  Really good.  That tells you? 

CORN:  I don‘t know what it tells me.  That he is a very tolerant person. 

MATTHEWS:  What happens to the Republican party in the northeast when they—Specter left the party.  It looks like there is no Republicans left in the northeast.  Judd Gregg‘s quitting.  Except for the two women senators up in Maine, there is no Republican party in the northeast anymore. 

HENNEBERGER:  Well, I‘m very disappointed that Rudy‘s not going to run, because I had already assigned a story on who was the more difficult one, Andy Cuomo or Rudy Giuliani.  I thought that was going to be a lot of fun. 

MATTHEWS:  You know what I see?  Down south, it‘s turning more and more Republican.  This guy Parker Griffith switching today tells you what the weather is like down there politically.  Up north, it is getting more and more Democrat.  We‘re becoming a party—a country defined by geography almost entirely. 

We‘ll be right back with Melinda Henneberger—which is not a good thing . 

(CROSS TALK)

MATTHEWS:  -- by geography.  David Corn.  Coming back with the politics fix.  We‘ll talk about this conversation we‘re getting with Michael Steele.  This guy is getting a little hectic out there.  Back with MSNBC, HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS:  Who says music is going downhill?  That was 1963 on “Bandstand.”  That was “The Bird is the Word” by the trash.  I brought that up because the chairman of the Republican party says the Democrats are flipping the bird, as he put it.  Let everybody know what they think about that.  Let them think for themselves.  But, Melinda, what‘s going on with Michael Steele?  Has he flipped? 

HENNEBERGER:  From when? 

MATTHEWS:  He‘s the chairman of the party.  He‘s using street corner, if not schoolyard maybe—maybe schoolyard lingo here. 

HENNEBERGER:  He did have a minute of being taken seriously when he was running for the Senate.  But, you know, at this point, I‘ve been wondering for a while if he‘s on the DNC payroll.  I mean, he really—I‘m sure they hope he sticks around for a long time. 

The flipping the bird thing, I mean, you know, OK.  But the taking money for speeches? 

MATTHEWS:  Maybe he‘s not a rich man. 

HENNEBERGER:  He‘s definitely not a rich man.  In fact, he was scuffling a lot trying to make a living as a lawyer before he became lieutenant governor. 

MATTHEWS:  We‘ve had chairmen of both parties have business dealings while they‘re chair. 

HENNEBERGER:  That‘s right.  But when your job is to be the front guy giving the speech, I don‘t think it looks that great. 

CORN:  He may need a safety net the way he‘s going.  Don‘t give up your day job. 

MATTHEWS:  He‘s been caught up in this kind of hectic—he‘s competing out there with the wing-nuts.  As chairman of the party, in his brood, he has a lot of far right wing people.  By the way, probably most birthers are probably Republicans.  Although you can‘t say the white Aryan League represent the Republican party.  People on the right tend to be more Republican than Democrat. 

CORN:  He had that problem in New York 23, that upstate district, when she supported a more liberal Republican, and then he basically got pushed on his keester by the Tea Party types.  Early on he talked about being a more tolerant position on abortion.  He had to reverse position on that.

MATTHEWS:  And now? 

CORN:  Now, listen, this is a guy who can lose his job at any moment, which would be really bad news for the Democrats.  Melinda‘s right.  So I think he  should keep giving speeches.  He needs some security. 

HENNEBERGER:  That‘s his plan b. 

MATTHEWS:  These parties are getting more and more polarized and they‘re getting more and more geographic.  You don‘t even have to—just show up in the voting booth, people can tell by your age and your ethnicity how you‘re going to vote. 

CORN:  I don‘t think that so true.  That was pretty true under the Bush years. 

MATTHEWS:  Young man, it‘s getting worse. 

CORN:  That‘s what an old guy always says.

MATTHEWS:  The group‘s called the Surfing Birds.  Thank you, Melinda

the Trashmen, rather, singing “The Surfing Bird.”  Melinda Henneberger and David Corn, you got your credits.  Join us again tomorrow night at 5:00 and 7:00 Eastern for more HARDBALL.  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.

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