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updated 10/1/2010 12:07:18 PM ET 2010-10-01T16:07:18

Guests: Jackie DeAngelis, Bill Clinton, Darrell Issa, Errol Louis, Joe Klein, Bob Woodward

CHRIS MATTHEWS, HOST:  Clinton joins the argument.

Let‘s play HARDBALL.

Good evening.  I‘m Chris Matthews in Dublin, traveling with former president Bill Clinton. 

Leading off tonight, Clinton one on one.  He says the election isn‘t about yes or no, it‘s about who you believe.  That‘s at the top of the show.

Also, Congressman James Clyburn said on HARDBALL here last night that if Republicans win the House, they will try to delegitimize President Obama.  Republican Darrell Issa called the charge paranoid.  Really?  Let‘s see what Issa does have in mind if Republicans gain control.

Plus, wait until you hear the threat that Carl Paladino, the Republican running for governor of New York, made last night.

(BEGIN VIDEO CLIP)

(CROSSTALK)

CARL PALADINO ®, NEW YORK CANDIDATE FOR GOV.:  You send another goon to my daughter‘s house, and I‘ll take you out, buddy!

FRED DICKER, “NEW YORK POST”:  You‘re going to take me out?

PALADINO:  Yes!

DICKER:  How‘re you going to do that?

PALADINO:  Watch!

(END VIDEO CLIP)

MATTHEWS:  There‘s much more to this tape, if that wasn‘t enough for you.  And by the way, who is this candidate that‘s threatening to “take out” people?

And all the president‘s generals.  How‘s President Obama working with American generals in Afghanistan?  Who‘s calling the shots?  That‘s my question for Bob Woodward.

Finally, remember this scene when Michele Bachmann was so inspired by President Bush that she just wouldn‘t let him go at that State of the Union?  Well, she‘s turned on Bush in her latest ad.  That‘s in the “Sideshow.”

All that‘s ahead.  First, let‘s check in on the latest polls in the tight races around the country.  For that we go to the HARDBALL “Scoreboard.”  We‘ll start with California, where a new PPIC poll shows what we‘ve seen from other current polls, Senator Barbara Boxer‘s building a strong lead over Republican challenger Carly Fiorina.

Up in Alaska, it looks like a real race now with Republican Joe miller at 38 percent, Senator Lisa Murkowski at 36 percent and Democrat Scott McAdams down at 22 percent in that new CNN/”Time” poll.  Remember, Murkowski‘s running as a write-in.

Finally to Florida, where Republican Marco Rubio is pulling away.  He‘s up 13 points over Charlie Crist in a new Quinnipiac poll, with Democrat Kendrick Meek way behind.  We‘ll continue to check the HARDBALL “Scoreboard” on all the big races each night leading up to the election day.

Now my interview with former president Clinton.  I began by asking him about all that fiery negativity you hear out there that seems to be dominating so much of politics today ever since he left office.

(BEGIN VIDEOTAPE)

MATTHEWS:  Let‘s talk about that today, that phenomenon in American life since you left office, and it‘s gotten worse, much worse, of this fiery negativity.

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES:  I don‘t know how it could get much worse than Newt Gingrich, Tom DeLay and Kenneth Starr.  It—but I do think—

MATTHEWS:  Well, now it‘s crossed parties.  It seems like everybody‘s either far left, far right—

CLINTON:  Yes, well—

MATTHEWS:  -- and angry as hell at the other side.

CLINTON:  I think you do have a—you have a polarized political

environment and a polarized media environment, even, increasingly.  I think

that part of it is that the American people are having a tough time.  By

the time I left office, we were growing together again for the first time

in—really since the 1970s, where the bottom 20 percent of earners were -

in my last four years, in percentage terms, saw their incomes go up as—in percentage terms the same as the top 20 percent.  And it seemed that, you know, the government was working again.  The approval of government was higher than it had been in a long time.

And then we had the controversy over Iraq.  We had the recession.  And even before the financial meltdown in September of 2008, the economy had only produced 2.5 million jobs, so that depressed wages.  And after inflation, health care costs had doubled.  So there was a lot of anxiety out there.

And I think in anxious times, people get on more of a hair trigger.  They‘re afraid that they are not doing right by their families.  They‘re afraid their own dreams are going to be thwarted.  And the siren song kind of politics, you know, that—on one extreme or the other seems to have more weight.

MATTHEWS:  You were quoting Yeats to me the other day on the plane, and—the center, and you and both Tony Blair, the former prime minister I spoke to recently about you, in fact—and he‘s very supportive of what you did and it‘s very similar.  Today, in this environment, is it possible to find that third way again, to bring a center-left constituency together when everybody wants to maybe get on the air on MSNBC and take a far-left position, get on Fox and take a Murdoch position all the way on the right?  How do you—I don‘t see the Republican Party fighting that center-right.

CLINTON:  Well, I think—

MATTHEWS:  Is there a Democratic center-right?

CLINTON:  I think there is but—

MATTHEWS:  Center-left, rather.

CLINTON:  But there—first—I think the answer to creating it is to persuade two thirds of the American people that you‘ve got your facts straight first, that there‘s a factual basis for what we‘re trying to do here.

For example, one of the things that has always frustrated me and Hillary—I mean, we talked about this a lot—is that Americans historically have been aware accurately of the exceptional nature of our country, and it is in many ways still quite an exceptional place, but they have therefore been resistant to comparative information.

So one fact that drives everything I think about health care is that we‘re now spending 17.2 percent of our income on health care and none of wealthy competitors are spending more than 10.5, and they all have longer life expectancies and lower infant mortality rates.  That means if we had any of their systems, we‘d save a trillion dollars a year and we‘d be healthier.  So a lot of people don‘t want to hear that.  They just know that, I go to my doctor and I like him, and somebody sends me a bill for my insurance.

That‘s just one example.  I think it‘s relevant that we‘ve recovered 70 percent of the income we lost from the depths of the recession.  Germany‘s at 60.  Japan‘s at 50.  The UK‘s at 30.  We don‘t have the jobs yet because all the jobs come always in this in the last 30 percent, and then when you‘re out, when you‘re out of the—

MATTHEWS:  Do you think facts like this will turn hearts in this environment today?

CLINTON:  Well, first of all, people‘s hearts are pretty hard, but their ears are not closed yet.  I think that people‘s hearts are moved when their lives are changed.  And this, you know—and I‘m not saying—those things are self-serving for me as a Democrat, what I say, but they are accurate facts.  And I think that, you know, the Republicans—I‘ll give you an example of a Republican accurate fact.  We have—they‘ve said—one thing I‘ve always agreed with them on is that adults who are compos mentis ought to be able to buy health insurance policies across state lines.

Now, what‘s the argument against that?  New York, where I live, requires a lot of things to be on health insurance policies, and I agree with them all.  But suppose you live in New York and you have a modest income and you have two kids and you want them to have some kind of insurance, and you could buy an insurance policy in Iowa that you think would meet the basic needs of your family.  I think you ought to be able to do that.

Now, the argument for that is that, basically, you wind up driving all people into lower policies.  In other words, it‘s not like there‘s no argument against that.  But I‘m persuaded that it‘s right.  Why?  Because I‘ve thought about the facts.

If you say right from the get-go President Obama is a closet socialist who wants to, you know, extend the reach of government across the length and breadth of the land and choke off free enterprise and small business and individual initiative, and therefore I got to be against whatever he‘s for, or if you say, We beat Bill Clinton and the Democrats in ‘94 by just saying No, we were responsible for health care not passing, we were responsible for thwarting things and we got credit for it and the things they did do, no one knew because the “no” drowned out the positive accomplishments—let‘s do it again, see if it‘ll work again—it may work in the short run.  But in the end, the country loses.  In the end, we have to find a way forward.

I‘ll never forget when I worked with the Reagan White House in ‘88 in

the first incarnation of Welfare reform.  And a lot of my fellow Democrats

said, You really think you can work with these guys?  I said, yes, they‘re

in private, they‘re perfectly honest with me.  We work through these things.  And even though they were more conservative than I was, they knew I wanted people who could work to work.  And when I pointed out that you couldn‘t ask poor people to go to work if they lost their food support or they couldn‘t provide medical care for their kids as a result of it, they got that and they didn‘t want to take it away.

We had that kind of debate that sensible people have when a husband and wife have a difference at home and they work through the difference by listening to each other and figuring out what the best possible compromise is.

MATTHEWS:  The Republican Party (INAUDIBLE) last era and the era

before under you, decided early on in the health care fight to just say no,

and they didn‘t get hit hard on it.  President Obama has decided from the

beginning—maybe it‘s Chicago politics, you don‘t talk about the

opposition, Dick Daley politics—he never mentioned Boehner‘s name, never

mentioned McConnell‘s name for, like, a year-and-a-half.  And now he‘s

calling them out.  Should he have called them out earlier, or is that good

--

CLINTON:  Probably.

MATTHEWS:  -- politics because just get away with saying no and stopping things.

MATTHEWS:  Well, probably because the other side was systematically attacking not just the president but also Speaker Pelosi and Senator Reid, and they‘re not, and you wouldn‘t expect them to be because very few people are—they‘re not as gifted on television or defending themselves as President Obama.

MATTHEWS:  So you‘d get them in the ring.

CLINTON:  And so they hauled them in there.  But the election—the Republicans want this to be an election on every bad thing you ever heard about Barack Obama, Nancy Pelosi and Harry Reid.  And so the reason the president is doing this, I think, is not just to hurt them but to say what they stand for, and this is not—it‘s a choice between Harry Reid and Mitch McConnell.  It‘s a choice between Nancy Pelosi and John Boehner.

And it‘s almost impossible with only a month to go—and they‘ve been doing it for maybe a month—to fill up the tank as much and—but it‘s worth reminding Americans that every election is a choice.  If you have to run against the ideal, if it‘s a referendum, every one of us will get beat.  Nobody‘d get elected.  We‘d have nobody in office because there‘s no such thing as the perfect public servant.  Every—the choices you make in politics are like the choices you make in life.  You look at the facts as best you can and you make the best available choice.

(END VIDEOTAPE)

MATTHEWS:  You know, that‘s an interesting insight into the Obama strategy by the former president.  He talked about how what, clearly, Obama is doing right now is to try to euchre or try to draw Mitch McConnell and John Boehner onto television, where they aren‘t so good, and expose them as the alternative, rather than just part of the “no” team, very interesting strategy you saw that from president.  It was part of a long interview we did today, part of an upcoming documentary we‘re going to do of the work of the former president.

By the way, that was taped today at the Clinton Institute on American Politics at University College Dublin, one of the many institutions being set up around the world by the former president.

Coming up: Congressman James Clyburn said yesterday on HARDBALL that if Republicans win the House, they‘ll use subpoena power to try to delegitimize President Obama.  Republican congressman Darrell Issa called us right after the show—in fact, during the show last night—and said Clyburn was being paranoid and goofy.

Well, up next, we‘re going to ask Issa himself what Republicans are, in fact, planning to do with the subpoena power that he, the probable ranking member on that reform committee, will have in his hand.

You‘re watching HARDBALL from Dublin, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Two political items of note.  First, Republican congressman Mike Castle has decided against running a write-in campaign for U.S. Senate in Delaware.  Castle‘s name recognition would have been making him a formidable opponent in the general election, so that‘s good news for the Democrat in the race, Chris Coons.  It looks like he‘s going to win that now.

And White House chief of staff Rahm Emanuel officially steps down from the White House chief of staff job tomorrow and begins his campaign for mayor of Chicago.  White House senior adviser Pete Rouse will replace Rahm on an interim basis.  They‘ll have to pick—they still have to pick perhaps a heavyweight chief of staff.

HARDBALL back after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. DARRELL ISSA ®, CALIFORNIA:  The era of Dan Burton and the era of people taking the 5th, leaving the country, and in some cases going to jail, is an era I hope none of us repeat.  In other words, the crimes that went on shouldn‘t repeat, and neither should the subpoenas.

(END VIDEO CLIP)

MATTHEWS:  Welcome back to HARDBALL.  That was California congressman Darrell Issa a couple weeks ago on CNN.  He‘s expected to chair the House Oversight Committee if Republicans take the majority.

Well, last night on HARDBALL, South Carolina Democratic congressman Jim Clyburn, the third-ranking Democrat in the House leadership, told us what he expects if Republicans get control.  Let‘s listen.

(BEGIN VIDEOTAPE)

MATTHEWS:  Do you really believe, as you said the other day, that if the Republicans get control of the Congress and the subpoena power, they‘re going to use it to go after the president‘s birth records, they‘re going to try to prove he‘s a foreigner and other nonsense like that?

REP. JAMES CLYBURN (D-SC), MAJORITY WHIP:  I absolutely believe that.  I take them at their word.  I‘ve watched their actions.  You know, what I always say, having grown up in a parsonage, it‘s not their words, it‘s their deeds.

And let‘s look at the members of that committee that‘s been talking about—the Government Oversight Committee.  You‘ve got Dan Burton sitting there.  He is a co-sponsor of a birther bill, Dan—you know, the ranking member, though he says that, I didn‘t mean the birther stuff, I meant to look at fraud cases.

Well, that‘s what they‘re saying.  They‘re trying to delegitimize this president.  They‘re calling him a fraud.  So he‘ll be going after these subpoenas with that in mind.

(END VIDEOTAPE)

MATTHEWS:  Let‘s go right now to Congressman Darrell Issa.  Thank you, Congressman Issa, for joining us tonight.  So it‘s not true.  Congressman Clyburn‘s dead wrong.  You are not going to deal with the kind of Burton stuff.  You‘re not going to shooting at cantaloupes out back on the Vince Foster case.  You‘re not going to be doing birther stuff, even though Burton‘s on one of the birther lists, and so is Fortenberry.  He‘s apparently talking like a birther.  You‘re not going to follow their lead.

ISSA:  Not at all.  First of all, that issue is long since settled.  You know, Chris, I came into Congress when people were questioning whether or not George W. Bush was legitimate.  Then I thought we should move on and work with the president.  Two years ago I felt the same way, and I have been since.

MATTHEWS:  Well, let‘s take a look at some things you have said.  You‘ve answered that question.  Let‘s talk here about something you said on May 25th of this year concerning the issue of Joe Sestak, your fellow congressman.  Let‘s watch.

(BEGIN VIDEO CLIP)

ISSA:  An allegation has been made that multiple sources in both parties—Anthony Weiner, Dick Morris and other Democrats have made it very clear, even Axelrod, that they should answer, that in fact, this is serious, this is an impeachable offense, according to Dick Morris.  And I think that brings back the whole Nixonian question of it‘s not about what was done wrong, it‘s about the cover-up.  And right now, there‘s a cover-up going on at the White House.

(END VIDEO CLIP)

MATTHEWS:  Do you believe that there was any impeachable offense involved in White House conversations, or alleged conversations, with Joe Sestak, the Democratic candidate for senator in Pennsylvania?

ISSA:  Well, Chris, that investigation has been pretty well been completed.  It‘s not—it‘s not an alleged allegation, now that we have e-mails and admissions that there were conversations with Joe Sestak and with Romanoff.

What we‘re really trying to get to the bottom of in the next Congress will be, is this business as usual, something that we believed probably happened under the Bush administration, according to some of their people, and, as Governor Rendell says, well, you know, you don‘t change everything?

Will the American people want us to change that, to quit, in the future, using taxpayer dollars and positions to influence primary events or save their party money?  I think the answer is, we‘re going to have to try to get compliance.

MATTHEWS:  Well, that‘s the question.  Are you going to—OK.  Well, that‘s the question.  Are you going to spend the next several months, if you get to be chairman of the Reform Committee, subpoenaing people like Rahm Emanuel, perhaps Ed Rendell, whoever else you might be mentioning here -- I don‘t know—asking them about a possible deal involving a job offer?  Are you going to spend your time doing that? 

ISSA:  Well, Chris, as I said, when Governor Rendell said this—this is typical, it goes on, I have done something similar, a member of the Bush administration‘s press team said that similar things happened under the Bush administration, what we discovered was that laws that are on the books to prevent this routinely are not considered to apply. 

So, as part of reform, it‘s not a matter of looking back.  Let‘s assume for a moment, as I believe, that every administration has done it.  We will look into whether or not taxpayer dollars should be used in that way and try to prevent it in the future, which I think is what the intent of the laws are.

But we have got a lot bigger problems.  We have $1.4 trillion of borrowed money to get through each year.  We are going to have to find savings, waste and so on. 

MATTHEWS:  Right. 

ISSA:  That‘s going to be the major agenda of our committee.  That‘s our real jurisdiction.

MATTHEWS:  So, it‘s not impeachable?  So, you‘re changing your mind now.  It‘s not what you called impeachable.  You don‘t believe—no, you use terms like this—I don‘t think Jim Clyburn has made up these charges against you—when you go after issues like—

(CROSSTALK)

MATTHEWS:  Go ahead.

ISSA:  Chris, I appreciate your comment, but let‘s understand that it was—I was quoting what Dick Morris said.  I was in no way, shape or form talking about it.  I‘m not—

MATTHEWS:  Why would you quote him?

ISSA:  -- going to be chairing that committee or anything else.

The fact is, I‘m on the committee of waste, fraud and oversight and reform.  It‘s really about going after far down below the president, below his key Cabinet officers, and get into the parts of government that waste your dollars.  That‘s what my committee has to do.  That‘s our mandate.  That‘s what I intend to do if I‘m given the opportunity. 

MATTHEWS:  OK. 

Here‘s something else.  This was posted this year by your staff. 

Let‘s listen to it on health care. 

(BEGIN VIDEO CLIP)

ISSA:  The concern is that, if you can bribe—and I mean bribe—members of the House and the Senate to get their votes, then democracy as we know it simply won‘t work. 

(END VIDEO CLIP)

MATTHEWS:  Well, we‘re talking about health care and you‘re using the term bribe there.  You use terms like bribe, like impeachable.  You‘re talking about the subpoena power. 

The question is, is this going to be another 80th Congress, like we had right after World War II, where they used to say they opened every day with a prayer and ended it with a probe?  Are there going to be a lot of probes like this going after people like Rahm Emanuel and people who you say took bribes in the health care bill? 

ISSA:  Well, I wish Rahm good luck in his campaign. 

The truth is that we have a problem in Congress with earmarks.  We have a problem in congressional with trading something for a district for something else in somebody else‘s district.  And, yes, I‘m going work with, I hope, Speaker Boehner to end the era of earmarks, no matter where they come from, and get back to accountable spending, transparent spending.

That is something I want to work on.

MATTHEWS:  Right.

ISSA:  It‘s not the issue of my committee, but it is the issue of Republicans if we have an opportunity to lead. 

MATTHEWS:  Do you believe that members of Congress, your colleagues, were bribed to vote for the health care bill?  You use the term here.  It‘s a legal term, bribe, as you know.  Did—do you mean it? 

ISSA:  I certainly think that there were a lot of inducements.

But we can go back to inducements on Medicare Part D.  It is not unique to have the heavy hand and the opportunity that comes from a White House to try to move legislation. 

The real question is, are we going to make it impossible either for an administration or for powerful members of the House or Senate to airdrop in spending and benefits for one district or another in order to get a vote on usually an unrelated matter?

MATTHEWS:  Yes. 

ISSA:  That‘s important.  And that‘s something that I take very seriously.  I think all Republicans have learned from many Republicans falling into that. 

MATTHEWS:  OK. 

ISSA:  And I think that‘s the important issue that the American people are thinking about is, have the Republicans learned their lesson from having been in the majority at a time in which earmarks got out of control?

MATTHEWS:  You sound very sober now, Congressman.  And I would—I would accept anything you say tonight, because you‘re in a very sober mood, but your staff is putting out terms like this—and I just got this—calling Congressman Clyburn, one of the ranking Democrats, one of the top three Democrats in the House, a sock puppet, a sock puppet.  You called him goofy and paranoid. 

Do you think these are appropriate ways to get along with your fellow members, these terms? 

ISSA:  Well, I certainly think calling somebody paranoid, when they‘re putting words into a mouth of—that—when my position is just the opposite as to the president, you know, I—I think that that was probably appropriate. 

I think that perhaps the Democrats are getting paranoid that the Republicans are going to take control, and so they‘re coming out with things out of fear or just making them up.  I have supported this president.  I have worked with this president.  I have tried to get legislation passed with this president.

MATTHEWS:  Right. 

ISSA:  And I intend on working with the president in the next Congress regardless of the outcome.  So I would hope that we can use better language. 

I would hope that we wouldn‘t claim that somebody‘s intentions are flat wrong.  I think we have to make sure the process is fair, the process is transparent, and then we all have to live up to the high standards that are set. 

MATTHEWS:  Thanks for coming on the show, Congressman Darrell Issa. 

ISSA:  Thanks, Chris. 

MATTHEWS:  He will probably be ranking member—in fact, is ranking member on the Reform Committee, may be chairman of it if the Republicans get control of the House. 

Up next:  Remember when Congresswoman Michele Bachmann hugged President Bush and wouldn‘t let go of him?  Well, now she‘s doing a complete 180 on the former president.  Wait until you catch her act in the “Sideshow.” 

You‘re watching HARDBALL from Dublin, where I‘m traveling with President Clinton—back after this. 

(COMMERCIAL BREAK)

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

First:  Where‘s the love?  Remember when Michele Bachmann first got our attention?  She was at the 2007 State of the Union, a newly elected congresswoman, when she latched on to President Bush, and, as you can see, wouldn‘t let go.  Three years later, Congresswoman Bachmann is singing a different tune. 

Check out the opening to her new ad. 

(BEGIN VIDEO CLIP, MICHELE BACHMANN CAMPAIGN AD)

REP. MICHELE BACHMANN ®, MINNESOTA:  Government spending doesn‘t create good jobs.  That‘s why I fought and voted against the Bush Wall Street bailout. 

(END VIDEO CLIP)

MATTHEWS:  Well, I‘m sorry.  It‘s a small point, but where is Congresswoman Bachmann‘s own salary coming from?  The U.S. government.  She‘s a government employee making fun of government employees.

Anyway, we will be back with more of the show. 

(COMMERCIAL BREAK)

JACKIE DEANGELIS, CNBC CORRESPONDENT:  I‘m Jackie DeAngelis with your CNBC “Market Wrap.”

Stocks finishing lower after some wild market swings, the Dow Jones industrials falling 47 points, the S&P 500 slipping 3.5, and the Nasdaq dipping nearly eight points.

Investors closing out the books on a surprisingly positive quarter and the best September in 71 years.  All the major indices posting remarkably strong gains this month and showing even stronger results for the quarter. 

Risk trades are back in trade, with tech and consumer discretionary stocks seeing a lot of activity.  And oil prices are up about 11 percent this month, climbing to nearly $80 a barrel.

Now, in stocks, AIG shares ending higher after saying it will sell two Japanese units to raise money to pay taxpayers back in full.

Dollar Thrifty shares ended flat after shareholders rejected a $1.5 billion takeover from Hertz.

And late-breaking news from Hewlett-Packard.  Former SAP CEO Leo Apotheker will take the reins following the departure of Mark Hurd. 

That‘s it from CNBC, first in business worldwide—now back to

HARDBALL. 

MATTHEWS:  You know, back when I was a kid—welcome back to HARDBALL

when I was a kid, we used to go as a family up to Lake George, New York, a lot. 

Well, something pretty scary happened up near Lake George, New York last night.  It involved the Republican candidate Carl Paladino going after “New York Post” reporter Fred Dicker.  Now, this is a frightening scene you don‘t often see, even in politics.  Let‘s watch.

(BEGIN VIDEO CLIP)

FRED DICKER, “NEW YORK POST”:  So, you have descended into the gutter by suggesting that he was involved in extramarital relations when he was married with no evidence.  Do you have any evidence of that?  And, if you don‘t, isn‘t that going into the gutter? 

CARL PALADINO ®, NEW YORK GUBERNATORIAL CANDIDATE:  Hmm.

Well a guy that‘s been in the gutter and spent a good part of his life in the gutter with Andrew Farkas should think twice about trying to characterize me.

DICKER:  Yes.  Well, you‘re a lawyer.

PALADINO:  Yes, I‘m a lawyer.

DICKER:  You‘ve heard the term.

PALADINO:  Yes.  And I‘m also a lawyer—

(CROSSTALK)

DICKER:  But what evidence do you have for something that most people would consider a smear? 

PALADINO:  I want to know why you sent your goons after my daughter. 

DICKER:  I sent no on after—

(CROSSTALK)

PALADINO:  Oh, I want to know, Fred.  I want to know about it. 

DICKER:  What does have to do with your charge against Cuomo?  Do you have any evidence or do you not?  

(CROSSTALK)

PALADINO:  I will appropriate—at the appropriate time, you are going to hear it.

(CROSSTALK)

DICKER:  He‘s got three daughters.  How can you say that about him?

(CROSSTALK)

PALADINO:  Oh, I have a daughter, too, Fred.  I have a daughter. 

(CROSSTALK)

DICKER:  You brought it out, Fred.  That‘s it.  That‘s it.

PALADINO:  Stay away from me.

DICKER:  The heck with you.

DICKER:  What evidence do you have? 

PALADINO:  Listen—

(CROSSTALK)

PALADINO:  Did you send one of your goons after my daughter?

(CROSSTALK)

DICKER:  Hey, guys, easy, come on. 

DICKER:  Come on. 

(CROSSTALK)

DICKER:  Don‘t touch me.

(CROSSTALK)

DICKER:  Who are you?  Who the hell are you?

(CROSSTALK)

DICKER:  Do you have any evidence for the charge you made? 

PALADINO:  At the appropriate time, you will get it. 

DICKER:  This guy is the attorney general of the state of New York.

(CROSSTALK)

PALADINO:  And you‘re his stalking horse right there.  You‘re his stalking horse.

(CROSSTALK)

DICKER:  What is the evidence?

PALADINO:  You‘re his bird dog.

DICKER:  You made the charge.

(CROSSTALK)

PALADINO:  You send another goon to my daughter‘s house, and I will take you out, buddy.

DICKER:  You‘re going to take me out?

PALADINO:  Yes.

DICKER:  How you going to do that?

PALADINO:  Watch.

DICKER:  So, what are you, threatening me?

(END VIDEO CLIP)

MATTHEWS:  Well, let‘s go to Errol Louis of “The New York Daily News,” and let‘s go to Joe Klein of “TIME” magazine, who has just been going across the country, getting a look at our country‘s mood. 

I don‘t think this is so much about a mood as a person, Carl Paladino threatening a reporter, threatening anybody to take them out. 

What‘s the nature of that threat, Errol Louis? 

ERROL LOUIS, COLUMNIST, “THE NEW YORK DAILY NEWS”:  Well, he has used it quite a bit.  Carl Paladino has said it about the leaders of the legislation.  He has said it about his political opponent.  Now, you just heard him say it about a journalist that he had a dispute with.

He says, I‘m going to take him out.  And that‘s part of his overall theme about cleaning up Albany, throwing the rascals out, getting rid of people who have caused problems.  And it‘s a growing list of people that are on Carl Paladino‘s problems list or enemies list. 

MATTHEWS:  So, it has an unusual meaning in his case.  You‘re saying it‘s not a physical threat to kill them? 

LOUIS:  No, no, no.  Well, you know what?  The reporter he was talking to, Fred Dicker, has I think a green belt in karate, so I don‘t know if that was really a realistic opportunity or option for Carl Paladino. 

But, no, he says it quite a lot, but the anger is real.  The

frustration that he is trying to channel, it has been a major theme of his

campaign.  He‘s been saying, there‘s just no room.  I mean, when he talks -

he talks in very rough language. 

When he criticizes the head of the state assembly, for example, he doesn‘t just say, I want to get him out of there by voting him out.  He says, I think the guy ought to go to prison, I mean, really wild kind of charges.  And so this has been the temperature of the campaign.

MATTHEWS:  Yes, well, that‘s all right.  That‘s a legal remedy. 

Joe Klein, I—I‘m not so sure—I‘m not so sure of what I‘m listening to here up here.  When one guy threatens a guy and says, I‘m going to take you out, it sounds to me a little more severe than just, I‘m going to talk to your employer, Mr. Murdoch, about you. 

What do you make of that charge, that threat?

JOE KLEIN, COLUMNIST, “TIME”:   Oh, it‘s kind of low-key New York politics as usual. 

(LAUGHTER)

KLEIN:  But—but—but I think, Chris, what you‘re looking at is a larger trend here. 

You have in—within the Republican Party, you have a majority of people who have been angry at their incumbents.  They have voted them out.  They have voted in these amateurs—and I have seen them across this country—who really don‘t know how to behave like politicians.

MATTHEWS:  Yes. 

KLEIN:  And, sometimes, that‘s refreshing.  Other times, it‘s really embarrassing. 

MATTHEWS:  Well, let‘s go up to Maine to another center of activity, another ring in this fight game, you might call it.

Paul LePage, he‘s a gubernatorial candidate.  Let‘s take a look at this little scene up in Maine.  And it also involves anger and tough talk. 

(BEGIN VIDEO CLIP)

PAUL LEPAGE ®, MAINE GUBERNATORIAL CANDIDATE:  And, as your governor, you‘re going to be seeing a lot of me on the front page, saying, Governor LePage tells Obama to go to hell.

(LAUGHTER)

(APPLAUSE)

(END VIDEO CLIP)

MATTHEWS:  Well, there‘s interesting language. 

And now let‘s go ahead and take a look at more of Paladino taking to Kate Snow, one of our reporters.  Let‘s take a look at that scene.

Here‘s Paladino.  Let‘s take a look at another SOT.

(BEGIN VIDEO CLIP)

PALADINO:  It‘s OK.  It‘s all right to show people that you‘re angry. 

It—it sort of—sort of gets the discussion going. 

KATE SNOW, NBC NEWS:  Who are you angry at? 

PALADINO:  Angry at a government that—that took advantage of the people, a government that is self-sustaining.  They have been eating at the public trough. We call it the—

(END VIDEO CLIP)

MATTHEWS:  You first, Errol, you talked about the anger.  You talked about the anger in New York and I want—and then I want Joe to pick up on it because he‘s been traveling across the country like Paul Simon looking for America and apparently finding it quite red faced.

You first, this anger out there, Errol?

LOUIS:  There‘s definitely anger out there, Upstate New York in particular where Carol Paladino hails from.  They‘ve been betrayed over and over again.  When you adjust for the value of a home, the property taxes up there, the taxes, the over tax load is the highest in the entire nation.  They‘ve lost tens of thousands of jobs.  I mean, people‘s kids just move out of state and it‘s been happening by the hundreds of thousands every year.

It‘s a real crisis and it hasn‘t broken through the media bubble down here in the city and Carl Paladino is trying to breakthrough that bubble and trying to basically grab the state by lapels and say, “We‘re dying upstate.  We‘ve got to do something different.  We‘ve got to change what goes on and off.”

The missing ingredient, as you say, Chris, though, is, you know, what‘s the real plan other than being outraged?

MATTHEWS:  Yes.  Joe, tell us about your trip.

KLEIN:  Well, listen, you know, I don‘t as much fist shaking anger out among the people as I do on TV.  There‘s some of that to be sure, but what people are really is freaked out.

You know, in past economic downturns that you and I have both covered, Chris, people are concerned that their kids aren‘t going to be able to live as good as they have.  Now, they‘re absolutely convinced that their kids are not going to live as good as they have.  They‘re absolutely convinced that we‘re going to be number two to China.  They‘re absolutely frustrated with our politicians for not dealing with the jobs and the trade and the outsourcing issues.

You know, for every time I hear the war in Afghanistan from average Americans, I hear China 25 times.  And they look at Washington.  They don‘t see anybody addressing this.

MATTHEWS:  Well, you know the interesting thing is at the same time, you hear people say they‘re against government.  They think government‘s too big, and yet they‘re holding it responsible for not getting their job back.  It seems like they want a bigger role for government.  They want it to get in there and big-foot the economy and make it walk right.

Isn‘t that a contradiction, Joe?

KLEIN:  Yes.  There‘s—you know, but there is no consistency, ideological consistency in the American people.  You know, I talked to a cop out in Michigan, in rural Michigan, who won‘t even tell me why he hates the president.  Obviously, you know, the president‘s some kind of a secret Muslim, and then I say, “Well, what do you think, you know, we should do to make the country better?”  And he says, “The government has to provide more jobs.”

There‘s no consistency.  You see it.  There‘s no such thing as a

straight ahead liberal or a straight ahead conservative in this country

right now.  What there is, is an awful lot of frustration and a sense that

and a sense of fear.

           

A lot of—you can‘t imagine how many people, as Errol was just saying, you can‘t imagine how many people‘s mortgages are underwater in this country and they see their neighbors walking away from their mortgages which reduced the value of their homes.  And they‘re saying to each other, “God, were our parents like this?  They wouldn‘t have done anything like this.  What‘s wrong with us?  What‘s happened to us a country?”

MATTHEWS:  Yes.  Yes.  Joe, it sounds like the president—I just talked to the former president, Bill Clinton, is right on this.  He says the anger is the only vote they‘re casting right now.  They ought to think of alternatives and what they‘re really voting for or against rather than just pounding their fists and going in and raising hell basically in that voting booth.

But I know the mood, and I appreciate what you‘re reporting here.  And certainly, I haven‘t seen anything like this guy Carl Paladino.  I hope I don‘t see too many guys like him in politics.

Anyway, maybe I‘m wrong.

(CROSSTALK)

MATTHEWS:  Errol Louis, thanks for joining us.  Joe Klein from “Time” magazine, Errol Louis—ha!  Well, there‘s quite of them out there.

Anyway, thank you, Joe Klein, who‘s been out there checking out the cages.

We‘ll be back with—actually, with Bob Woodward, the best journalist in the country, I think.  With no offense to these guys, the best investigative reporter in the country, Bob Woodward.  His big book, an insight into this war in Afghanistan.  “Obama‘s Wars” is the name of the book.

We‘ll be right back.

(COMMERCIAL BREAK)

MATTHEWS:  It‘s my honor today to remember one of Hollywood‘s all-time greats, Tony Curtis.  He died last night at the age of 85.  I‘ll never forget the first time I saw him in “Some Like It Hot,” Curtis and the ever zany Jack Lemmon masqueraded as women in an unforgettable and iconic gender bending performance.  Curtis‘ scenes with Marilyn Monroe were the definition of on-screen chemistry.

Curtis also showed his dramatic talents in “Spartacus,” as a Roman slave who held his own against the brass Kirk Douglas and the oh so cool Laurence Olivier.

Tony Curtis was the real deal.  His love of the art came out in every film and every TV appearance I ever saw him in.  We‘re going to miss this guy.

And we‘re coming back with Bob Woodward‘s new book and Bob himself, “Obama‘s Wars.”  And it paints an unvarnished portrait of a president doing battle with his own military over how to wage a war.

The big question: did President Obama get control of his generals or this news strategy, or did the generals box him into a war?

Bob Woodward—back in a minute.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back.

We‘re joined right now by Bob Woodward of “The Washington Post.”  He‘s written his big book, “Obama‘s Wars.”

Bob, thanks for joining us.  I‘m over here in Dublin.

I wanted to know—before we get any further into this—your sense, I guess it‘s something you could conclude as a straight reporter, is Barack Obama got control of the military right now?

BOB WOODWARD, AUTHOR, “OBAMA‘S WARS”:  Well, he‘s the commander-in-chief and as General Petraeus says in these meetings, actually told President Obama, “We in the military will support you.  We‘re not self-employed.”

At the same time in the strategy review last year, they really erected this, these blocks of granite that included Hillary Clinton, Secretary of Defense Gates, and said, 40,000 troops as McChrystal wants and that‘s it.  It‘s quite baffling and astonishing to see at these meetings where I have the notes and the whole scene is in the book.  The president said, “Well, you promised three options today and you are essentially giving me one.”  And the military said, “Well, yes, sir.”

Obama went at Gates and said, “Look, where‘s the option?  This is unacceptable”—an electric moment in the Situation Room, in the White House.  And Secretary Gates said, “Yes, we owe you that option,” and it never came, and the president had to devise his own.

MATTHEWS:  You know, Bob, you‘re familiar with the military.  You served in the military and you‘ve covered all of these years through all of your books about presidents and the military.  Is this one of the cases where the military is putting the president in a position where eventually they‘ll get him to do what they want?  By the way, they sort of euchre him into a strategy plan.

WOODWARD:  No.  It‘s not that.  But, look, this is not out of conviction on the part of the generals.  They believe they need these troops.  They believe they need this time.

The problem - and this is the problem Obama has, he‘s very cerebral and analytical and he gets all of these intelligence reports.  They have a secret monthly update about how the war is going.  And the news is not good.

Out of one of these meetings, he literally comes out and says, “Given this definition of the problem, I don‘t see how we‘re going to design a solution.”  It is a war that I think even his General Petraeus‘ head spinning.  He said there‘s been some signs of progress, but when you really dig into this, you find that there are more signs of trouble and in insurgency Taliban, insurgency there, that literally still has the upper hand.

MATTHEWS:  Do you have a concluding thought about the president‘s own clarity of thought?  It seems in all that I‘ve read from the book he wanted to get out on a timetable.  He didn‘t want to be stuck in a long-term war or find himself at the end of one or two terms with a bigger war than he started with.

But did he honestly accept the fact that there would be constraints to that kind of policy?  There were certain dangers to that, things we couldn‘t control if we‘re going to leave on a relatively rapid timetable?

WOODWARD:  Well, he wants out.  And the theme music in the background here is Vietnam.  Even though he told me and reminded me that he was so young, Vietnam didn‘t have an impact on him as a young boy, Vietnam is there.  And Joe Biden, the vice president, is all over the president, just pushing and pounding and hammering in a wonderful Biden-esque way, saying, “We‘re locked into Vietnam unless we draw up these—this term sheet and tell the military, you don‘t have unlimited time.  We have to tell the military what they can‘t do, not just what they can do.”

So, the condition, bottom line of this, is right now, you go through and read all of this.  And it sets the table for the world we‘re in at this moment which is very unsettled.  Not just in the politics of the country and where the economy is going, but very much the war in Afghanistan, the president‘s going to have to make some tough decisions in the next six to nine months.

MATTHEWS:  We‘ll be right back with more with Bob Woodward.  I want to know whether next July is really going to be the deadline for beginning to leave Afghanistan.

Back with more with Bob Woodward and his new book “Obama‘s Wars”—in a minute.

(COMMERCIAL BREAK0

MATTHEWS:  We‘re going to be in London tomorrow night on HARDBALL and I‘m going to have a long interview with Tony Blair about many of these topics, including the war.

Let‘s talk now about this quote.  Here‘s President Obama saying to his military, to his generals, “I‘m not going to make a commitment that leaves my successor with more troops than I inherited in Afghanistan.”

That‘s a tough charge, Bob Woodward.  He‘s saying, “I want to reduce the number of troops.”  But is he also saying, “I want to do a little bit of nation-building for the next couple of years”?

WOODWARD:  Well, there‘s nation-building in the strategy of win hearts in minds and protect the people, and at the same time, he‘s made it very clear, if you look at and you talk to him about this, as I have, he never uses the word “counterinsurgency” which is really the core of the strategy.

And you can—you can see that he‘s a doubter.  He gets into the details here.  And the whole theory of the case that he‘s presented to the generals in the national security team is: OK, you go in to an area, a platoon or a company of our soldiers, you clear out the insurgents, you hold the area, you build the schools, you kind of nation-build a little bit and then you have to transfer to the Afghans.

And you look at this, and there are almost no areas of the country where this can be done now.  So, we‘re not—the military is not even on the edge of implementing his theory of the case.

MATTHEWS:  Does the president have something that he can get done, in his mind‘s eye over the next two years that justifies the loss of life and limb that will come from staying a couple of more years in Afghanistan, then leaving?

WOODWARD:  I think he‘s got to have some good news out of this war.  And you know, one possibility, if Secretary Gates leaves, which he kind of has one foot out the door, put somebody in there who‘s really a leader, who knows how to deal with war.  And the name that‘s being bandied around is Colin Powell, of all people, somebody who served in Vietnam, chairman of the Joint Chiefs during the First Gulf War, learned a lot of the lessons in the Iraq war and the Afghan war.

And so, that‘s a possibility but good news is needed.

MATTHEWS:  OK.  Thank you very much, Bob Woodward—as always, a great book, “Obama‘s Wars.”

As I said, we‘re going to have Tony Blair on tomorrow night.  We‘ll be in London.

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

Right now, it‘s the time for “THE ED SHOW” with Ed Schultz.

           

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