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updated 7/21/2010 10:55:54 AM ET 2010-07-21T14:55:54


Guests:  Jim McDermott, David Corn, Lynn Sweet
CHRIS MATTHEWS, HOST:  Race bait.
Let‘s play HARDBALL.
Good evening.  I‘m Chris Matthews out in Los Angeles, where tonight I‘ll be speaking at the Ronald Reagan presidential library. 
Leading off tonight, race and deception.  Ever since Barack Obama became a viable presidential candidate, the right wing has marshaled its resources to make the discredited case that he and his supporters are either anti-white racists or tolerant of that kind of racism.  Now comes the latest chapter. 
A Department of Agriculture official has been pushed out after a video was released by a right-wing Web site in which she admits that 24 years ago, she failed to give a white farmer all the help she could because of his race. 
Shirley Sherrod says the speech was to show how wrong she was at the time.  But the right-wing media machine has suggested that she discriminated while an Obama appointee—in other words, within the last year.  That‘s our top story.
Plus BP and the Lockerbie connection.  Both President Obama and British Prime Minister David Cameron today condemned the release of the Lockerbie bomber one year ago.  Little that was said today quashed suspicions that BP may have influenced Libya‘s decision in order to get its own oil operation going in Libya.
Also, Senate Democrats plus two Republicans have overcome Republican opposition to extending unemployment benefits.  It‘s a big win for President Obama today.  Can he make the GOP pay for it this fall?
And show time.  B-Rod, Rod Blagojevich, is finally taking the stand in his own defense out in Chicago.  We‘ll get a preview from those who know him best.
And don‘t mess with Maddow.  That‘s MSNBC‘s Rachel Maddow.  When Florida Republican Marco Rubio put out a Web ad against her, she didn‘t get mad, she didn‘t get even, she had some fun in the process.  That‘s in the “Sideshow.”
We begin with the case of Shirley Sherrod, who was pushed from her post at the Department of Agriculture.  Eugene Robinson is a Pulitzer Prize-winning columnist for “The Washington Post” and Michelle Bernard is with the Independent Women‘s Voice.  Both are MSNBC political analysts.
Let‘s listen now.  Here‘s Shirley Sherrod in tape from a March speech of this year to a local NAACP group as it appeared on Biggovernment.com yesterday.  Let‘s listen.
(BEGIN VIDEO CLIP)
SHIRLEY SHERROD, DEPT. OF AGRICULTURE:  The first time I was faced with having to help a white farmer save his farm, he took a long time talking.  But he was trying to show me he was superior to me.  I knew what he was doing.  But he had come to me for help.
What he didn‘t know, while he was taking all that time trying to show me he was superior to me, was I was trying to decide just how much help I was going to give him.  I was struggling with the fact that so many black people had lost their farm land, and here I was faced with having to help a white person save their land.  So I didn‘t give him the full force of what I could do.  I did enough so that when he—I assumed the Department of Agriculture had sent him to me, either that or the Georgia Department of Agriculture, and he needed to go back and report that I did try to help him.
So I took him to a white lawyer that had attended some of the training that we had provided because Chapter 12 bankruptcy had just been enacted for the family farm.  So I figured if I take him to one of them, that his own kind would take care of him.
That‘s when it was revealed to me that it‘s about poor versus those who have.  It‘s not so much about white—it is about white and black, but it‘s not—you know, it opened my eyes because I took him to one of his own.
(END VIDEO CLIP)
MATTHEWS:  Andrew Breitbart posted that video on his Web site under the headline, “Video proof the NAACP awards racism 2010.”
Now let‘s take a look at what was said on CNN today about this issue. 
Let‘s watch.
(BEGIN VIDEO CLIP)
TONY HARRIS, CNN ANCHOR:  Did you discriminate against this white farmer 24 years ago, when you were, I guess, about 38 years old, because he brought you what you described in your March NAACP speech as a superior attitude?
SHERROD:  You know, initially.  And that‘s why I said that I took the time to read (ph) what was happening there.  He did come with a superior attitude, but I didn‘t discriminate.  If I had discriminated against him, I would not have given him any help at all because I wasn‘t obligated to do it by anyone.  I wasn‘t working for the government.  I didn‘t have to help him, but I did.  And I went on—that was the first white farmer I helped.  I went onto help hundreds of others through the years.
(END VIDEO CLIP)
MATTHEWS:  And here‘s Eloise Spooner, the wife of that farmer from 26 years ago, on the phone with CNN today.  Let‘s listen to her story.
(BEGIN VIDEO CLIP)
HARRIS:  What do you think of Shirley?
ELOISE SPOONER, RETIRED FARMER:  She‘s a good friend.
HARRIS:  Describe your relationship with her through the years.
SPOONER:  She helped us save our farm.  That ain‘t right.  They have not treated her right because she did—she‘s the one I give credit to helping us save our farm.  She gave enough that it helped us save our farm.
(END VIDEO CLIP)
MATTHEWS:  You know what, Gene?  I‘m just thinking of that old song from (INAUDIBLE) How can people be so heartless?  You know, here‘s a story of reconciliation of a quarter century ago, of a woman who came to understand the plight of all poor people, not just black people in the South, where she grew up.  Despite all that racial difference and all that racial hell that black people put up with, she could understand that people could be in the same situation economically.  And here this guy, Breitbart, has taken this and turned it into something mean and nasty.
EUGENE ROBINSON, “WASHINGTON POST,” MSNBC POLITICAL ANALYST:  Yes, through the miracle of editing.  You know, if you just posted a clip of the first part of her remarks, you‘d have a different interpretation, when actually, she was—she appears to have been telling a parable about reconciliation, you know, it really kind of quite heartwarming story.  You know, that‘s not journalism.  I mean, it‘s lying, is what it is.  And I think we ought to call it for what it is.
MATTHEWS:  Michelle, this is part of a larger attempt, I believe, to rip the scab off race problems in this country.  I really do believe, and I‘m going to say at the end of the show, that people who have a race problem on the white side are trying to show it on the black side to somehow give them moral justification for their attitude.  I can‘t think of another reason to do this.  There‘s no political advantage to this except causing trouble.
MICHELLE BERNARD, INDEPENDENT WOMEN‘S VOICE, MSNBC POLITICAL ANALYST: 
There have—I have never seen—literally since the time Barack Obama was elected to the presidency, there has been one attempt after another to say that he is a racist, that people in his administration are racist, that he somehow condones racism.  I think that‘s what we‘re seeing here.
I think that this woman also was not helped by the fact that the NAACP originally condemned the statements that we saw on that videotape, and from all of the reporting that I have been able to see and read so far, we have not actually seen the entire tape.  This woman went onto help this family and help many, many other white farmers and said that her philosophy became one of understanding that it‘s not a matter of race, of people being black and white, but that it was really a matter of people who have versus people who have not, you know?
And in reading all the reporting, I keep thinking about what if people had always condemned Robert Byrd?  You know, you think about the images of his funeral.  Robert Byrd was a member of the Ku Klux Klan.
MATTHEWS:  Yes.
BERNARD:  And there was Barack Obama paying him respect, giving his condolences at—you know, at his funeral.  We have seen nothing as great in our family as—in our country as we have in terms of the power of redemption and people being able to find a way to get over race.  And I hope that somebody will have the decency to play this—play the videotape in its entirety so that we can go on to see all of the statements that this woman made—
MATTHEWS:  OK.
BERNARD:  -- because I do believe that she‘s telling the truth when she says that she went onto help this gentleman and to help many, many other white farmers after this incident happened -- 28 years ago, by the way, not while she was working for the Department of Agriculture.
MATTHEWS:  Right.  That‘s the big lie here, what you just said, Michelle, because she‘s telling this spring a group of African-Americans who are committed to racial justice in this country about how you can do things wrong as a black person, how you can be discriminatory against a white farmer who‘s poor, way back a quarter century ago.
And the dishonesty, the deceit, the evil of this Web site is to put this out as if it‘s something she did while she‘s on watch as a government official under the Obama administration so they can tag Obama with this.
Now, I think—here‘s Bill O‘Reilly last night on FOX.  I think Bill, knowing Bill, is going to correct this tonight.  I really hope he does.  I think he will.  But here he is operating in the same rash judgment the White House operated in—I should say the Department of Agriculture, backed up by the White House, the NAACP.  Everybody is listening for footsteps on the liberal side of things, on the progressive side of things, so afraid to be tagged for counter-racism or reverse racism.  Here‘s Bill O‘Reilly last night.  And again, I think he‘s going to correct this tonight.  I‘m betting on it.  Here he is last night.
(BEGIN VIDEO CLIP)
BILL O‘REILLY, “THE O‘REILLY FACTOR”:  Well, that is simply unacceptable, and Ms. Sherrod must resign immediately.  The federal government cannot have skin color deciding any assistance.  We are requesting an explanation from the agriculture secretary, Tom Vilsack, and we‘ll keep you posted.  By the way, the full transcript of Ms. Sherrod‘s remarks is on Biggovernment.com.
(END VIDEO CLIP)
MATTHEWS:  And here‘s Sean Hannity backing him up with Newt Gingrich, of all people, as your expert witness here on Fox last night.  Let‘s listen to Newt go at it.
(BEGIN VIDEO CLIP)
SEAN HANNITY, HOST, “HANNITY”:  She said she wanted him to go out and deal with one of his own, and she put him in touch with a white lawyer, just the latest in a series of racial incidents!  What do you think of this?
NEWT GINGRICH (R-GA), FORMER SPEAKER OF THE HOUSE:  Well, look, let me say, first of all, Secretary Vilsack did the right thing.  I mean, I often disagree with this administration, but firing her after that kind of a viciously racist attitude was exactly the right thing to do, and the fact that we have to be genuinely color-blind.  You know, you can‘t be a black racist any more than you can be a white racist.
(END VIDEO CLIP)
MATTHEWS:  And this guy‘s talking about running for president.
Let me go back to Gene on this.  I mean, this is a full dress rehearsal for the bad guys.  I mean, here they are out here.  I don‘t know why the White House backed up Vilsack on this.  What do you make of the politics on the liberal side?  Why is the president scared or—to back up Vilsack?  Why is Vilsack sticking to his guns on this, saying she‘s out?
ROBINSON:  Well, you said it, Chris.  It‘s hearing footsteps.  This issue obviously makes them skittish and jittery to the point where nobody, it seems, bothered to ask Mrs. Sherrod the context of her remarks.  And if that‘s what she, in fact, said, what she—what she meant by what she was saying, or indeed, to give her a chance to say, But that‘s not the whole story, that wasn‘t all of what I—the story I recounted.  I was talking about something that happened 25 years ago or more.
So it clearly makes them jumpy.  We don‘t yet know the full story of -
the White House, I guess, says it wasn‘t directly involved, at least in her forced resignation.  Clearly, the Agriculture Department was.  And I‘m not sure why, at this point, they‘re still saying, Well, she‘s out, she‘s out.

BERNARD:  Chris, could I—
MATTHEWS:  Yes, they are saying they‘re backing up—they are backing up Vilsack with that.  You‘re right on that reporting.  They had nothing to do with the initial decision, they say.  Your thoughts, Michelle.
BERNARD:  Well, you know, first of all, I think—I got to say, you know, Newt Gingrich is right when there is no—when he says that there‘s no place for black racism or white racism.  And if you were to see the videotape and assume that it was the entire videotape, what she said looks very, very damning.
But the problem here is that, as Gene said, no one took the time to investigate all of the facts before people started commenting on it and painting her out as some sort of rogue racist.  And the problem that the administration now has is that after the Skip Gates problem, after the NAACP—you know, with the NAACP, you know, calling on the tea party last weekend, and you know, alleging that members of the tea party are racist, you know, there‘s—it‘s a snowball effect, one thing after another.
And with us being—having our first African-American president, it‘s as if the administration just gets nervous and doesn‘t know how to handle the fact that he‘s black, rather than just simply ignore it, ignore his race and let—allow him to govern as the president of the United States, period, and stay out of these matters of race.  You know, the administration is saying that they didn‘t call on her—call for her resignation, but in every interview this woman has given, she has said that she has been that the administration wanted her out.
MATTHEWS:  Well, let‘s take a look.  Here she is on CNN on the White House reaction Monday.  Let‘s listen.
(BEGIN VIDEO CLIP)
SHERROD:  They asked me to resign.  And in fact, they harassed me.  As I was driving back to the state office from West Point, Georgia, yesterday, I had at least three calls telling me the White House wanted me to resign.  That was Cheryl Cook, the deputy undersecretary.  She called me and said—because she called me, and I said, Cheryl, I got a 3-and-a-half hour ride to get into Athens.  She called me a second time.  Where are you now?  I said, I‘m just going through Atlanta.  She called me again.  I said, I‘m at least 45 minutes to an hour from Athens.  She said, Well, Shirley, they want you to pull over to the side of the road and do it because you‘re going to be on Glenn Beck tonight.
(END VIDEO CLIP)
MATTHEWS:  Well, let‘s skip over the likes of Glenn Beck and the others over on Fox.  I want to pay tribute, guys, to Tony Harris at CNN.  His interview today with Sharon (SIC) Sherrod and with Eloise Spooner, the white woman who after all these years, recalls Sharon as a woman who looked out for her, who, quote, “saved our farm”—Shirley, that she saved the farm.  It was—it was Eloise Spooner who said that it was Shirley Sherrod, this woman who‘s now been fired, basically, who quote, “I give credit to for helping us save our farm.  She gave us enough.  It helped us save our farm.”  And they‘ve been friends all those years.  And there she is, getting blamed for some—something she did against this family that owes her their farm in terms of her help for them.
Gene, I think it‘s an amazingly good story behind a bad story that was told to us by this Web site.
ROBINSON:  Exactly.  I mean, it all comes back to the initial big lie.  I mean, the story as put out by Breitbart on Big—on his Web site, which I won‘t even repeat the name of—
MATTHEWS:  No.
ROBINSON:  -- initially was simply a lie.  It was edited in a way to make the facts seem totally opposite to what the facts actually were.  And the sad thing, of course, is that this—the individual who was trying just to tell a story about learning and growth and reconciliation, Shirley Sherrod, was forced out of her job because of a lie.
MATTHEWS:  You know what I think tonight, that O‘Reilly‘s going to correct this story.  I‘m not counting on the other people on Fox, but I think he will correct this story.  Michelle, you betting for or against O‘Reilly to straighten this story tonight?
BERNARD:  You know what?  I‘m betting for O‘Reilly to change it, and also for—you know, for Breitbart and his Web site.  I think that once this video is available in full, if he gets it, I am betting that he‘s going to put the entire videotape on his Web site and allow people to watch the Web site for themselves and judge whether or not people actually think this woman is a rogue racist and should have lost her job.
MATTHEWS:  Well, you do believe in redemption all the way there.
BERNARD:  I do.
MATTHEWS:  Good for you, Michelle, for the most optimistic voice.  I‘m only betting on O‘Reilly.  Anyway, thank you, Gene Robinson.  Thank you, Michelle Bernard.
Coming up: Republicans want to extended the Bush tax cuts, for the rich, obviously, beyond this January, but they‘ve fought like mad not to extend jobless benefits for those people out of work, including a lot of middle-aged people got bounced out of their jobs.  Can President Obama and the Democrats make them pay politically this coming November in the elections?
You‘re watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
MATTHEWS:  Elena Kagan is one step closer to been on the Supreme Court.  The Senate Judiciary Committee approved her nomination today.  Here it goes.  The vote was 13 to 6, with one Republican—you guessed it, Lindsey Graham of South Carolina—voting for her confirmation.  Senator Graham was the only Republican on that committee to vote for Sonia Sotomayor, as well.  The full Senate‘s expected to vote on Kagan‘s confirmation next month.
We‘ll be right back.
(COMMERCIAL BREAK)
MATTHEWS:  Welcome back to HARDBALL. 
After months of Republican efforts to block it, 60 senators voted to move forward on extending unemployment insurance today.  President Obama and his party sound happy to make this an issue for November.  Will it help him hold power?
With us today, Democratic Congressman Jim McDermott of Washington State. 
Mr. McDermott, thank you.
This is one of the strangest issues, because it seems like all the advantage is on your side.  Why wouldn‘t people want to help people who have been out of work a long time?  Let‘s face it.  It isn‘t just people who are usually unemployed who are out of work right now.  It‘s a lot of men and women who have had jobs in their career after 20 or 30 years that have been bounced. 
Politically, that doesn‘t make sense to me. 
REP. JIM MCDERMOTT (D), WASHINGTON:  I have been never, Chris, been able to understand this at all, how you could possibly look middle-class people in the face who have played by the rules and done everything according to the way it‘s supposed to work, and then say to them, we haven‘t got enough money to take care of you, when you‘re bailing out banks and you‘re fighting wars and you‘re paying for drug benefits and all kinds of stuff with no—with borrowed money. 
You can‘t find the money for people who have been good, solid middle-class people in this country.  It doesn‘t make any sense at all. 
MATTHEWS:  Well, let‘s take a look at the president on Monday on this issue.  Let‘s listen. 
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  Over the past few weeks, a majority of senators have tried, not once, not twice, but three times to extend emergency relief on a temporary basis.  Each time a partisan minority in the Senate has used parliamentary maneuvers to block a vote, denying millions of people who are out of work much-needed relief. 
These leaders in the Senate who are advancing a misguided notion that emergency relief somehow discourages people from looking for a job should talk to these folks. 
(END VIDEO CLIP)
MATTHEWS:  Congressman, we had a conservative intellectual on last week.  And I think I challenged him well.  I think I did a good job in challenging him.  But let me have your thoughts.  He said that the reasons that the Republicans are opposing extension of unemployment benefits is that people who are out of work for a while should be taught a lesson, that they can‘t have a good job back, basically.  They have got to take a job that is a cut below. 
Of course, I asked him, how about your friends at the Heritage Foundation or wherever you work?  Have you told them to go looking for a job flipping hamburgers?  Have you told them to fly out to—or take a Greyhound out to Nebraska from New York looking for a job?
It seems the academics believe in this pure labor market notion that there‘s a job for you somewhere; you just have to accept it and find it.  I don‘t know.  Is this academia talking or what?  I don‘t know. 
MCDERMOTT:  There is only one study that anybody quotes that says that getting an unemployment check may have some effect on people‘s willingness to go look for a job. 
But that‘s in a market where you have all kinds of jobs.  Right now, you have got five people at a minimum looking for every job that‘s available out there.  You have got close to 15 million people without jobs. 
And this nonsense, if you just want to go look, there‘s a job, I have
“The New York Times” had a story on Sunday, saying a woman had been sending them out for 18 months.  She had had three callbacks in that period of time, and she was trying to go from a $14 job down to a $7-an-hour job, and it wouldn‘t even pay her bills. 

But she was still willing to take it if they would accept her.  There are people struggling all over this country.  Those guys who are talking like that have never been out of work, or they never knew anybody who was out of work, or they haven‘t talked to anybody who was out of work. 
MATTHEWS:  Well, the same crowd that‘s defending the ramparts of fiscal responsibility on this issue are ready to let it all fall down.  They‘re opening the drawbridge for the Reagan—the Bush tax cuts to be extended. 
They can‘t wait to continue them and fight—how are you guys going to stand up and women in the Democratic Party going to stand up against the power of this country, the real business and economic power people, who want to keep those low tax rates that Bush pushed through, even though it will keep the deficit high?
MCDERMOTT:  Well, it‘s going to be a very interesting debate, because what Jon Kyl is saying on behalf of the Republicans is, we don‘t have to pay for the $834 billion in tax cuts, but we can‘t find $34 billion to pay for the unemployed. 
Now, my view is, if you‘re worried about deficits, it‘s time for you to step up and put your nickel on the bar.  They have not paid for the wars.  They didn‘t pay for the tax breaks in the first place.  They haven‘t paid for the bailouts.  They haven‘t paid for any of this stuff.  And now they want to say, let‘s let these tax cuts go forever, make them permanent. 
That‘s not good politics. 
MATTHEWS:  Yes. 
MCDERMOTT:  It‘s not good fiscal policy. 
MATTHEWS:  Isn‘t it wonderful the way the neocons sell war after war without any notion of cost in human life or national treasure?  It‘s all free.  It‘s all—just read “The Weekly Standard.”  Just read one of their rags.  The wars are wonderful. 
Anyway, thank you, Congressman Jim McDermott of Washington State. 
MCDERMOTT:  Good to see you.
Up next:  which teen idol pop star does Jay Leno think is like our own Charlie Cook?  I love these things.  They‘re totally ridiculous.  But there he is, Charlie Cook.  Well, let‘s see who he looks like.  That‘s in the “Sideshow.”
You‘re watching HARDBALL, only on MSNBC.  
(COMMERCIAL BREAK)
MATTHEWS:  Back to HARDBALL.  Time for the “Sideshow.” 
BP is facing more scrutiny today, as a blogger noticed some recent photo manipulation by them. 
Take a look here at this photo that was taken of BP‘s command center in Houston.  See those blank screens?  There weren‘t video feeds on every monitor.  Now take a look at the edited photo—edited photo of the command center that BP posted on its Web site.  Presto chango, the blank screens are gone.  These screens now appear to have video feeds on them.
Why even bother editing the photo?  Well, all BP is saying is, it won‘t happening again.  But if BP executives are wondering why people question what they say, all they have to do is look at their own Web site for an answer. 
By the way, BP has now posted the original unedited photo. 
Next:  Last week, Republican Florida Senate candidate Marco Rubio released a Web ad against our colleague Rachel Maddow. 
Here‘s a taste of it. 
(BEGIN VIDEO CLIP, MARCO RUBIO CAMPAIGN AD)
(on screen):  On Tuesday, Marco Rubio announced 12 simple ideas to grow the economy and create jobs.  How can you know the plan is right?  Rachel Maddow think it‘s wrong. 
(END VIDEO CLIP)
MATTHEWS:  Well, last night, Rachel issued a rebuttal.  Take a look. 
(BEGIN VIDEO CLIP, “THE RACHEL MADDOW SHOW”)
(on screen):  Marco Rubio has proposals for cutting the deficit and growing the economy.  He wants to make Bush‘s ‘01 and ‘03 tax cuts permanent, end the estate tax, prevent cap and trade energy legislation.
How does Marco Rubio say you can know his plan is right?  “Rachel Maddow think it‘s wrong.”
Seriously, that‘s his argument.  That‘s it. 
Even if everything about me is inherently wrong just by virtue of who I am, this is still true about Marco Rubio.  His economic proposals will add $3.5 trillion to the federal deficit.  Examples:  Keep the ‘01 and ‘03 tax cuts: $2.3 trillion.  End the estate tax: $364 billion.  Prevent cap and trade energy legislation: $19 billion. 
When Marco Rubio says he would cut the deficit, he either doesn‘t understand his own policy ideas or he doesn‘t understand what a deficit is. 
Marco Rubio is right about one thing, though.  Rachel Maddow comes on at 9:00 p.m.  And we‘re on the Internet, too: maddowblog.MSNBC.com.
(END VIDEO CLIP)
MATTHEWS:  Well, as my hero Winston Churchill once said, I like a man who grin when he fights.  Dare I offer an update, Sir Winston?  I like a man or woman who grins when they fight. 
Next:  You may heard of the young singer Justin Bieber and preteen girls‘ Justin fever touring across the country this summer.  Well, according to my pal Jay Leno, Bieber bears a striking resemblance to a HARDBALL guest of last night. 
(BEGIN VIDEO CLIP, “THE TONIGHT SHOW WITH JAY LENO”)
JAY LENO, HOST, “THE TONIGHT SHOW WITH JAY LENO”:  Once again, time for a thing we call too old for Bieber hair. 
(LAUGHTER)
LENO:  This one features political analyst Charlie Cook.  Let‘s take a look. 
UNIDENTIFIED SINGERS (singing):  Too young for Bieber hair.
CHARLIE COOK, EDITOR & PUBLISHER, “THE COOK POLITICAL REPORT”:  -- and that he doesn‘t connect with people as much as—as, say, Bill Clinton did. 
(CHEERING AND APPLAUSE)
UNIDENTIFIED SINGERS (singing):  Too young for Bieber hair.
LENO:  Not good. 
(APPLAUSE)
LENO:  Not good.
(APPLAUSE)
(END VIDEO CLIP)
MATTHEWS:  Well, maybe they have got the same barber. 
(LAUGHTER)
MATTHEWS:  And now for tonight‘s “Big Number.” 
It‘s no secret our friends in print journalism are facing declining numbers, but how doomed do Americans think the newspaper business is?
Well, according to the Pew research, 64 percent of those polled think, by 2050, there won‘t be hard copies of the newspaper anymore, no morning edition to hold while you‘re drinking the coffee -- 64 percent, two-thirds, say the paper is gone soon—tonight‘s “Big Number.” 
Up next:  British Prime Minister David Cameron is in Washington today.  And he couldn‘t avoid questions about BP and what role the British oil giant played in getting the Lockerbie bomber freed—the latest details on BP‘s dealing next.
You‘re watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
JULIA BOORSTIN, CNBC CORRESPONDENT:  I‘m Julia Boorstin with your CNBC “Market Wrap.”
Stocks turning it around this afternoon, after starting the session with some massive declines.  The Dow Jones industrial adding 75 points, the S&P 500 pushing 12 points higher, and the Nasdaq climbing 24 points. 
Energy and materials shares leading the late-day rally and retail stocks gained after the Senate moved closer to extending unemployment benefits. 
In earnings news, Apple blowing away the Street with some out-of-this-world quarterly earnings and revenue backed by super-strong sales and a solid outlook.  But Yahoo! shares falling through the floor in after-hours trading after beating expectations on profits, but missing on revenue.  Meanwhile, Goldman Sachs also beating out earnings, but coming in light on the revenue side.  And Johnson & Johnson, that‘s right, beating on estimates, but flat on revenue. 
And late-breaking news from BP.  It‘s generating some cash by selling about $7 billion worth of assets to fellow drillers Apache Corp. 
That‘s it from CNBC, first in business worldwide—now back to
HARDBALL. 
MATTHEWS:  Back to HARDBALL. 
The release of the only terrorist convicted in the Pan Am 103 bombing dominated today‘s press conference by the British prime minister and President Obama—at issue, whether British company BP lobbied for the terrorist‘s release in exchange for helping getting access to Libya‘s oil. 
British Prime Minister Cameron says there will be not a new U.K.-based inquiry.  Here he is. 
(BEGIN VIDEO CLIP)
DAVID CAMERON, BRITISH PRIME MINISTER:  In terms of an inquiry, there has been an inquiry by the Scottish Parliament into the way the decision was made.  The British government—the last British government—released a whole heap of information about this decision.  But I have asked the Cabinet Secretary today to go back through all of the paperwork and see if more needs to be published about the background to this decision.
But in terms of an inquiry, I‘m not currently minded that we need to have a U.K.-based inquiry on this—partly for this reason:  I don‘t need an inquiry to tell me what was a bad decision.  It was a bad decision. 
(END VIDEO CLIP)
MATTHEWS:  Well, here‘s President Obama supporting the prime minister. 
Let‘s listen. 
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  So we welcome any additional information that will give us insights and a better understanding of why the decision was made.
But I think that the key thing to understand here is that we‘ve got a British Prime Minister who shares our anger over the decision.
(END VIDEO CLIP)
MATTHEWS:  Well, Michael Isikoff is NBC News investigative correspondent.  David Corn is Washington bureau chief of “Mother Jones” and a columnist for Politics Daily.
I want to start with Michael. 
By the way, welcome aboard.  It‘s great to have you on the team here. 
What do you think is the big question that looms here about the role that BP played as a lobbying firm—firms lobby—to get this guy al-Megrahi out of the—the clutches of the Scottish government and back to Libya, where he seems to be growing in health?
MICHAEL ISIKOFF, MSNBC CONTRIBUTOR:  Well—
(LAUGHTER)
ISIKOFF:  -- there are two—there are two tracks here. 
There is this whole issue of the prisoner transfer agreement.  This is the agreement that was signed between the British government and the Libyan government that was insisted upon by the Libyans as part of an arrangement by which they would grant this huge oil concession to BP last—last year. 
And we now know, although we knew some of this last year as well, that BP weighed in, with the British government.  The guy who did it, who was the BP point person on this, was a guy by the name of Mark Allen, a former high-level MI6 spymaster.  He was the—their chief of counterterrorism, one of their top Mideast experts. 
The Scots, when asked about this, like to talk about the prisoner transfer agreement and BP lobbying and saying they didn‘t like that.  The Brits saying, it doesn‘t matter, you released him on completely separate grounds.
MATTHEWS:  David Corn, let‘s get to the real politics to this.  Here‘s the question: We got BP, it‘s not too popular in this country.  They‘re responsible for—they are responsible for the worst environmental anti-conservation action in history.  And now, we find—and they got to pay for that—and now we find out they‘ve got this role in letting a bad guy go.
Now, just to remind people watching right now—and sometimes you lose the humanity of this.  This happened back in 1988, which is, what, 22 years ago.  But the fact is, look at this: there were 259 people killed on that plane.
It was taken down on purpose.  These people were all killed.  It‘s premeditated murder.  Let‘s face it.
A hundred ninety of them are Americans.  That‘s important to a lot of Americans.  A whole bunch of them are students that went over on there on student—like junior year abroad from Syracuse, from schools like Colgate and Hampshire College.  Schools around and we can identify these kids, you know, 18, 19 years old, going away to school.  The excitement of coming home to see their parents and being back with their families and dying in this over-air collision or over-air horror—
DAVID CORN, MOTHER JONES:  Explosion.
MATTHEWS:  -- and a completely created—explosion—completely created by the act of man.  People wanted what we‘re looking at to happen.  They systematically planted the bomb.  They systematically killed these people, totally innocent people, to make some sick point.
And, now, we let the guy go, who we know did it, under this bogus—well, he‘s been alive for year and I don‘t know how bogus it was.  Your thoughts, David.  This is sheer politics.
And, by the way, why wasn‘t the president a little bit louder on this over a year ago when this guy get out?  I‘m only hearing this anger now sort of back it up, (INAUDIBLE) prime minister, a little late on the draw here, I think, maybe.  Your thoughts?
CORN:  Well, I had—I had a friend that day who has had a ticket for that flight.  But she didn‘t make the connecting flight so she wasn‘t on it.  So, I nearly lost, you know, a close friend in that explosion.  So, these things do, they sort of subside in time.  But for the victims, they remain very real and very tangible.
And what struck me today was when David Cameron was talking with Barack Obama by his side.  He said, “Don‘t blame BP.  Blame the Scots.”  You know, he really—
MATTHEWS:  Yes.
CORN:  -- went out of the way to distinguish between the two and just sort of make it sound like whatever BP did, it didn‘t really matter because they didn‘t have the power at the end of the day.  It was either the U.K.  government, the Brits or the Scots.  Now, that is technically true.
But I do think, you know, when we see—there‘s a hearing next week here in Washington, in the Senate Foreign Relations Committee that is trying to call some BP officials.  I think it‘s the right thing to do to try to get to the bottom of this and see if there‘s more to the story than we know.  It‘s quite possible that the story is as we have learned it to be, that BP made this effort, targeting Jack Straw and the Scots made the decision based on something else, maybe after getting a nod and wink from London.
MATTHEWS:  OK.
CORN:  Maybe not.  But, you know, I still think—
MATTHEWS:  Well, let me come back—
CORN:  -- there‘s enough room to dig further.
MATTHEWS:  We only got a little time now, Michael.  Is this B.S. or “Braveheart”?  I mean, we think well of the Scots.  But it looks to me like their biggest products are whiskey and oil.  Did they do this to get an oil deal with BP?  They did this for jobs?
(CROSSTALK)
MATTHEWS:  Even though the guy was healthy.
ISIKOFF:  I think the Scots, you know, putting the best face on for the Scots, the sort of misguided compassion.  You read the report that Kenny McCaskill, justice minister, issued and he talks about compassion for Megrahi‘s family and this will allow him to reunite with his family and that will -- 
MATTHEWS:  Yes.
ISIKOFF:  -- psychologically benefit them.  I don‘t think the victims‘ families would feel very comforted by all this compassion for a convicted terrorist.
But, look, at the end of the day, you asked a good question.  You said, “Why didn‘t we hear more outrage from the United States government a year ago when all this took place?”  And that‘s a very good question.
MATTHEWS:  Yes.
ISIKOFF:  And we heard some.  Both Secretary Clinton and Attorney General Holder called McCaskill, tried to lobby him against releasing Megrahi.  But, at the end of the day, the Obama administration has continued the Bush administration policy of restoring relations with Khadafy, taking him off the state sponsored terrorism list.
(CROSSTALK)
MATTHEWS:  Look at the kissing—look at them kissing this guy.  This is it.  They‘re not kissing him because he‘s sick.  They‘re kissing him because he‘s a terrorist.  That‘s why they‘re kissing this guy.  Let‘s go.
CORN:  And a year ago, Chris, we didn‘t care that much about BP.  The BP angle has made the story more electric.
MATTHEWS:  All right.  Good thought.  Got to go.  Got to go.  Got to go, guys.
We‘re on television.  Thank you, Michael Isikoff.  Thank you, David Corn.
Up next: Will B-Rod testify, and if so when?  The latest twist on the trial of former Illinois governor, B-Rod, Rod Blagojevich, is going to be talking soon.  We‘ll be right back to talk about that with the experts.
You‘re watching HARDBALL, on MSNBC.
(COMMERCIAL BREAK)
MATTHEWS:  West Virginia Governor Joe Manchin announced today he is running for the Senate seat formally held by Robert Byrd.  The special election is now set for November.  And Manchin, a Democrat, is very popular.  He won re-election as governor in 2008 by a 44-point margin.
By the way, former Manchin aide, Carte Goodwin, is the newest U.S.  senator.  He was sworn in today to fill that seat until November‘s special election.
HARDBALL—right back.
(COMMERCIAL BREAK)
MATTHEWS:  Back to HARDBALL.
Rod Blagojevich was expected to take the stand in his own defense tomorrow, but after court adjourned abruptly today, we‘re now hearing that he might not take the stand at all.
Lynn Sweet is reporting on the trial for “The Chicago Sun-Times”; Jim Warren is an MSNBC analyst and columnist for “The New York Times” and the “Chicago Inquirer.”
Jim, you start, and quickly.  Why won‘t he get on the stand?  If he doesn‘t, what would be the reason not to get on?
JIM WARREN, MSNBC ANALYST:  If he doesn‘t get on because he‘s simply catalytic as a personality.  The tapes which we‘ve seen so far are absolutely radioactive.  The notion that you can offer benign explanations for a lot of the profane scheming is a bit of a stretch.
There‘s been an internal debate for months within his camp about whether he should testify.  He‘s client.  He thinks he can talk himself out of everything.
And to sort of add a capper to all of this the last couple of days, his brother who‘s—his co-defendant, mentioned in five of the 24 counts, he testified the last couple of days, and he got sliced up pretty good when it came to government cross-examination and asking him to explain what are comparatively far more benign FBI wiretaps than the ones which catch his younger brother Rod.
MATTHEWS:  OK.  Let me go to Lynn on this.
Lynn, could they make the argument or bluff they would say to the jury, the case hasn‘t been made, we don‘t have to put our client on the stand.
LYNN SWEET, CHICAGO SUN-TIMES:  That‘s exactly where they‘re going.  You know there‘s the division between the lawyers.  That‘s going to be the explanation might be bought by the jury.  They have to explain something.
Blagojevich has been telling everybody who would listen.  I talked to him two weeks ago.  He told me he was going to testify.  He‘s told that to everybody.  The lawyers have to provide some reason to the jury why they won‘t hear from him.
MATTHEWS:  I want to go to Jim on this.
The O.J. jury had a lot of hunch there going for their guy because they didn‘t like the LAPD, didn‘t like the way the case was prosecuted and everything else.  Is there any reason to believe that this jury is so inclined to like the defendant here that they‘re going to give him a break unless they get hard evidence, really hard?
WARREN:  No, I don‘t think.  I mean, look at polling numbers or even the king of American mayors, Richard M. Daley here in Chicago.  He‘s down to 37 percent favorability ratings.  It has to do with this sort of visceral disdain, which the folks in the White House are obviously very nervous about when it comes to incumbents all across the board.
So, I think combine that with just listening day after day—Chris, it‘s not just the transcripts which you may say, but it‘s the intonation, it‘s the atmosphere, it‘s the tone in the guy‘s voice as he‘s scheming and plotting that, I think, makes it a very, very difficult, you know, call to put him on the witness stand.
MATTHEWS:  Lynn, have they made the case, as you‘ve understood it, if you were the jury, have they made the case that he‘s taken action, not just sat around and B.S.‘d with his staffers about how to take advantage of the open seat, Obama‘s open Senate seat—but is there evidence so far that you‘ve heard that says he took steps to commit a crime here beyond just talk?
SWEET:  No.  I think that that is the weakest part of the prosecution case.  But the better part of the case has to do with his extortion and shakedown charges.  I think they could, in a defense, make it clear that he didn‘t cross the line, came right up to it.  Clearly, what he did was sleazy, but sleazy isn‘t always illegal.
MATTHEWS:  Well, that‘s the question, Jim.  Is the Chicago jury—go back to the question—are they so hardened that they say this is the way business is done behind the doors?
WARREN:  No, I don‘t think so.  I think when they get into the jury room, I think, you know, red, white and blue, patriotic, listened to the jury instructions that they‘re going to be given.  And if you look at the jury instructions that they‘re likely to be given on counts such as bribery, conspiracy, where all you‘ve got to prove is the intent and false statements.  Clearly, I think they have got him on false statements.  He said something—oh, I don‘t mix politics and government and they got him.
I think even amid—
MATTHEWS:  OK.
WARREN:  -- the hardened Chicago, jury is going to find he‘s in hot water.
MATTHEWS:  OK.  I can‘t wait for tomorrow.  Lynn Sweet, thank you. 
Jim Warren, see you tomorrow, I hope.
When we return, let me finish with some thoughts about the right-wing mania.
You‘re watching HARDBALL, only on MSNBC.
(COMMERCIAL BREAK)
MATTHEWS:  Let me finish tonight with the right-wing mania hitting this country.  I‘m not talking about people worried, angry even over the bad economy, the high unemployment, the deficit, the rising national debt.  Who isn‘t worried about those things?  Everything that‘s been happening in this economy—highlighted by the financial crisis of the fall of 2008 is scary.  It‘s only added to the concerns—highly justified I think—about the growing tendency of this country to rely on borrowing, not just to offset economic downturns which we were taught in school made sense but as standard operating procedure.
No, the right-wing mania runs deeper and does no good for America. 
The Tea Party people just love attacking government—government itself.  It‘s their favorite attack target: government.  As if they had this alternative to running things in a free democratic society.
What is their alternative, I wonder?  Why is some talking secession from the Union, like Texas‘ Rick Perry, say they‘re for the Constitution but they keep talking about dumping all the parts they don‘t like?  Like the progressive income tax and direct popular election of senators.  The only part they do like is the Second Amendment, not for hunting, not for sport, not for self-protection, but to challenge their favorite target—you know, government.
Sharron Angle, running for the U.S. Senate in Nevada, talks about Second Amendment remedies to things they don‘t like Congress doing.  Give that some thought.
Congresswoman Michele Bachmann yesterday created a Tea Party caucus right in Congress itself, even while saying that no one in Congress was responding to Tea Party demands.  No one, not even Republicans?
A while back, Bachmann got useful notoriety with her call on this program for a media investigation of Democrats in Congress for what she called anti-American attitudes.  She‘s talking pure Tea Party now.  The whole government needs to be dumped.
I forgot something—race.  Listen to the birthers.  Catch their latest rant about the woman working at the A.G. Department down in Georgia, that mean distortion of her story and you see a right-wing effort to rip the skullcap off from America‘s hard racial history.
People push this line want to justify racism by finding it on the other side.  They want to tear the country apart if it would leave them of the duty of living in modern America, which I truly believe—despite all their anger—continues to march in making us a more progressive land, something they just can‘t stand.
That‘s HARDBALL for now.  Thanks for being with us.
Right now, it‘s time for “THE ED SHOW” with Ed Schultz.

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