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updated 1/18/2012 10:40:07 AM ET 2012-01-18T15:40:07

Guests: Brian Sullivan, Ed Schultz, Harry Smith, Dana Milbank, Susan Page, Ron Christie, Roger Simon, Mike Tate

CHRIS MATTHEWS, HOST: Mitt Romney`s tax rates.

Let`s play HARDBALL.

Good evening. I`m Chris Matthews in Washington. Leading off tonight:
The 15 percent solution. How many ways has Mitt Romney messed up talking
about his income in the last several hours? Well, let me count the ways.
Last night, he was unclear about whether he would release his tax records.
Now we know why. Today Mitt Romney acknowledges he pays roughly -- catch
this -- 15 percent in taxes, a far lower rate than people making much less.

Then he said, quote, "And then I get speakers` fees from time to time,
but not very much." Not very much? That "not very much" amounted to
$374,000 a year, about nine-and-a-half times what an average American
makes.

Well, no one`s denying Mitt`s right to make money, certainly, but no
one is going to stop the Democrats from making an issue out of it, either.
This has only begun.

Plus, once again, the audience was the big story at last night`s
Republican debate. Big cheers when Rick Perry said South Carolina is at
war with the federal government, boos when Juan Williams, the moderator
asked Newt about possibly making racially insensitive remarks, and then, of
course, huge cheers for Newt when he stuck it to Juan Williams with his
answers.

Anyway, does all this matter? Do the rowdy debate audiences tell us
something about where the GOP is these days?

Also, on Wisconsin! Tonight, opponents of Governor Scott Walker have
turned on -- turned in one million petition signatures demanding his
recall. This is about more than whether the anti-union Walker can survive
a recall election. This is about mobilizing the Democratic base in a must-
win state for President Obama.

And new tapes have come to light in which the captain of that grounded
cruise liner off the coast of Italy refused to get back aboard and help
save his passengers. It`s a little off course for us in terms of topic,
but wait`ll you get into this incredible stuff. What a story this is.
You`ll want to hear it tonight on HARDBALL.

And "Let Me Finish" with Newt Gingrich calling President Obama the
"food stamp president." We`ll get to that one.

We start with Mitt Romney`s income tax and the income he makes. Dana
Milbank`s a columnist for "The Washington Post" and Susan Page is
Washington bureau chief for "USA Today."

Well, I guess we`re learning why he`s been so secretive about his
income taxes, Dana.

DANA MILBANK, "WASHINGTON POST": Chris, I`ll bet you $10,000 that
Mitt Romney...

(LAUGHTER)

MILBANK: ... has no idea how ridiculous he sounds when he does this
because he`s doing it over and over again. And to Mitt Romney, $374,000
isn`t a lot of money. The problem, he wants to be president of a country
for whom most people...

MATTHEWS: Which -- that`s seven times the average income for a
family.

MILBANK: ... you know -- and you know, I mean, but consider his --
perhaps his...

MATTHEWS: But he`s speaking the way he thinks!

MILBANK: Right, and he`s got to stop doing that at all cost.

(LAUGHTER)

MATTHEWS: So you realize every time we do what you`re doing right
now, we say, Learn how to talk American regular people, he gets more and
more withdrawn.

MILBANK: Yes, and this goes back to his Al Gore problem. He`s so
afraid of what might come out of his mouth, he`s thinking it through his
head very carefully before he says anything, which actually makes him make
more mistakes, which is why you got that absurd Clintonian equivocation on
whether...

MATTHEWS: Well, we know what he means, right? He has $250 million in
net worth, apparently. He probably makes -- if he makes 1 percent a year
on his income -- I was doing this math the other day -- he makes $2.5
million a year, if only 1 percent return -- so compared to that, the
$300,000-some in speakers` fees is relatively a small part of his income if
he only makes 1 percent on the money. If he makes 10 percent on his money,
he`s making $25 million a year.

SUSAN PAGE, "USA TODAY": Also a pretty good salary. You know, the
one...

MATTHEWS: And he only pays capital gains on it. The average person
has to pay 30-some percent on their taxes if they make a good (INAUDIBLE)
for middle income. This guy only pays 15 percent because he`s basically a
coupon clipper.

PAGE: But the one good thing for him is that he`s doing this in
January. The election...

MATTHEWS: Oh, you -- everybody -- would you -- every journalist --
would you stop doing this! Everybody does this, Oh, it`s only now. Well,
don`t people have memories?

PAGE: Well, people do have memories, but you litigate it now, he
figures out an appropriate response.

MATTHEWS: OK.

PAGE: He releases his tax return. It is less potent when (INAUDIBLE)

MATTHEWS: This is like the baseball team that says, We only have to
win the games in the fall because -- in the spring because we won`t have to
win them in the fall. You do have to win them in the fall.

PAGE: Well, better off if he had better instincts on this. No
question about that. I`m just saying better for him to do this in January
and try to...

MATTHEWS: OK...

PAGE: ... figure out what he`s going to say...

MATTHEWS: Do you buy this argument? By the way, Susan, I`m...

(CROSSTALK)

MATTHEWS: Everybody`s doing this now. Everybody`s -- Oh, glad he`s
dealing with it now!

MILBANK: Well, sure, it`s better to get it out of the way now, but
it`s becoming part of the shorthand. Mitt Romney -- word association...

MATTHEWS: Yes.

MILBANK: ... you think the $10,000 bet, the $250 million fortune,
laying off people through the companies...

MATTHEWS: Yes.

MILBANK: ... he bought at Bain. It becomes part of this. And
therefore, because it`s on -- you know, in everybody`s mind...

MATTHEWS: Yes.

MILBANK: ... it`s easier for President Obama when he goes on the
attack to bring that out. It`s a caricature, and it`s just waiting...

MATTHEWS: OK, here`s what I`m thinking about, why it may last. All
the Occupy movement, even though it`s had a hard time finding its actual,
you know, essential point, it`s about the fact that the very rich in this
country have a very good deal. In addition to being very rich, they have a
very good deal in terms of taxes. Warren Buffett has made that point.

Here`s a guy, apparently, in his own words, of his own admission this
morning, pays 15 percent. Now, everybody out there watching right now pays
more.

PAGE: Right.

MATTHEWS: I mean, everybody...

PAGE: It`s -- you know...

MATTHEWS: ... watching right now pays more than 15 percent because
they earn their income through salary or wages. And that means you have to
pay up to 30-some percent. This guy never has to pay beyond 15 because, as
he pointed out today, he hasn`t really been working for 10 years!

(LAUGHTER)

MATTHEWS: Here it is -- here it is this morning. Newt -- Mitt Romney
-- these names here are much the same -- was pressed by reporters on what
his returns would show. Now, here he is, maybe doing what you`re saying
he`s doing, which is, as Bobby Kennedy used to say, hang a lantern on your
problem, bet it over with. Let`s watch him admit his 15 percent solution.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R-MA), FMR. GOV., PRESIDENTIAL CANDIDATE: What`s the
effective rate I`ve been paying? Well, it`s probably closer to the 15
percent rate that I think is my last 10 years, I -- my income comes
overwhelmingly from investments made in the past, rather than ordinary
income or rather than earned annual income. I think I get a little bit of
income from my book, but I gave that all away. And then I get speakers`
fees from time to time, but not very much.

(END VIDEO CLIP)

MATTHEWS: Not very much.

(LAUGHTER)

PAGE: He can`t run as a poor guy. He can`t run as a working Joe,
right? He`s going to have to run as a rich guy because he is a rich guy.
He needs to figure out how to explain that to people in a way that makes
them not resent it and makes them feel like he has some understanding about
the lives that other Americans (INAUDIBLE)

MATTHEWS: Do you think, Susan, that the people -- and then Dana -- do
you think people that think about people making a lot of money, like Donald
Trump, some of them people sort of like, like Trump, I hate to say it, but
they like Trump -- they like characters. They like -- they like real
serious entrepreneurs like Steve Jobs, the late Steve Jobs. Why do you
think Romney would be not vulnerable -- would be vulnerable to dislike for
being rich?

PAGE: I think that Americans don`t resent it when people work hard
and are successful. I think that`s part of the American dream. People --
rich people run for office all the -- most of the people who run for office
are rich people, the fact is. It`s the exception people who...

MATTHEWS: I`m watching the Golden Globes the other night, which I
love because they`re sitting around, drinking, and occasionally somebody
says something ridiculous and they actually look like regular people. We
like them all!

MILBANK: Sure. And I think...

MATTHEWS: They`re making money!

MILBANK: Contrary to what you said earlier, I suspect the idle rich
are watching your show, as well, tonight. So there may be some people at
that 15 percent. Romney is blessed that his opponent, likely opponent,
President Obama, is also a very wealthy man.

But the difference and where this really is going to stick and
resonate with voters is the "corporations are people" formulation, not only
that he`s wealthy, but that he`s looking out for wealthy people like him.
And it`s just so easy to puncture and it`s easy to...

MATTHEWS: By the way...

(CROSSTALK)

MATTHEWS: ... not met many of those people you describe. You know
who watches this show? People who work pretty hard, get home, you know, in
the evening and want something that`s sort of big picture they can argue
about and think about. And also, some retirees who`ve worked very hard
over their lives. So your -- you know, your disdain for them...

(LAUGHTER)

MILBANK: I -- I`m really-...

(CROSSTALK)

MATTHEWS: Anyway -- I`m just kidding!

MILBANK: Don`t frown on the idle rich...

(CROSSTALK)

MATTHEWS: ... watch HARDBALL. Anyway -- they watch other programs.
Anyway, Newt Gingrich joked about Romney`s 15 percent tax rate today with
reporters. Let`s watch Newt going in for the kill.

(BEGIN VIDEO CLIP)

NEWT GINGRICH (R), FMR. HOUSE SPEAKER, PRESIDENTIAL CANDIDATE: He
ought to release his taxes and we`ll out whether or not it was really 15 15
percent. And second, I think that we ought to rename our flat tax. We
have a 15 percent flat tax. So this will be the Mitt Romney flat tax that
all Americans could then pay the rate Romney paid. I think that`s
terrific.

(END VIDEO CLIP)

MATTHEWS: The forgiving -- I should say the saving grace of Newt
Gingrich is he`s got a brain on his shoulders. He needs a saving grace
most of the time.

(LAUGHTER)

MATTHEWS: There he is, pointing out something brilliant. Why don`t
we have everybody pay the same tax rates as this guy?

(LAUGHTER)

MATTHEWS: Right?

MILBANK: And call it the Romney rate. I`m sure that Romney`s
frustrated by that sort of an attack, but he`s got to be thanking his lucky
stars every day for Newt Gingrich because if you look at Newt and Santorum
right now, add them together, they`re ahead of Romney in South Carolina.
They`re ahead of him nationally, but they are making sure that Romney`s
going to become the nominee.

MATTHEWS: Well, let`s take a look at an exchange last night. Here`s
Rick Santorum blasting away at Romney for the attack ads that a pro-Romney
super-PAC has been airing about Santorum. Santorum said the ads distorted
his own record on voting rights for felons. Of course, we know that issue.
Once you`ve been declared a felon, you can`t vote in many states. Let`s
watch.

(BEGIN VIDEO CLIP)

RICK SANTORUM (R-PA), FMR. SEN., PRESIDENTIAL CANDIDATE: I would ask
Governor Romney, Do you believe people who have -- who are felons, who`ve
served their time, who`ve extended -- exhausted their parole and probation
-- should they be given the right to vote?

UNIDENTIFIED MALE: Governor Romney?

ROMNEY: First of all, as you know, the PACs that run ads on various
candidates, as we unfortunately know in this...

SANTORUM: I`m looking for a question -- an answer to the question
first.

(LAUGHTER)

(CHEERS AND APPLAUSE)

ROMNEY: We have plenty of time. I`ll get there. I`ll do it in the
order I want to do.

SANTORUM: This is Martin Luther king Day. This is a huge deal in the
African-American community.

ROMNEY: I don`t think people who`ve committed violent crimes should
be allowed to vote again. That`s my own view.

(CHEERS AND APPLAUSE)

SANTORUM: In the state of Massachusetts, when you were governor, the
law was that not only could violent felons vote after they exhausted their
sentences, but they could vote while they were on probation and parole.

(END VIDEO CLIP)

MATTHEWS: Well, look, this whole thing -- you know, I mean,
obviously, Romney has a belief that he`s allowed to co-moderate when he
wants to.

(LAUGHTER)

MATTHEWS: He just answers the question he wants to answer, when he
wants to do it, and if somebody else is talking, he tells them to shut up.

PAGE: But explain to me -- Rick Santorum, I think, got under Romney`s
skin a little bit there, so that was probably satisfying. But why is he
criticizing him on voting rights for felons, not on Massachusetts`s health
care plan or flip-flops on social issues or other things that might
actually matter to Republican voters?

MATTHEWS: Because Romney`s going after him on that. This is a tit
for tat.

PAGE: I understand that. But is this going to persuade any
Republican to switch from Romney to him? It`s hard to imagine.

MATTHEWS: People tell me that the critics of that performance last
night say that what Rick Santorum was trying to do was to hook him into
saying he didn`t believe in giving voting rights to felons so he could come
back and say, But in Massachusetts, you gave them voting rights for people
who were on parole and probation.

PAGE: He didn`t give it to them. He didn`t -- he didn`t fight to
change the law.

MATTHEWS: He`s not that good at it.

MILBANK: But this -- but this is progress.

MATTHEWS: He lacks for (ph) skills.

(LAUGHTER)

MILBANK: This is progress. Romney is improving. Yes, it`s bad
whenever your answer starts to be about some gobbledy-gook about PACs, but
at least he didn`t ask the moderator for help this time. He answered it on
his own.

MATTHEWS: Well, look, the problem with this whole thing -- we`re
going to get to the second part of this show -- the second segment we`re
going to get to something really awful I think Newt was engaging in last
night about food stamps and all. But this debate process right -- is this
-- are we getting near the end here, Dana? We`ve had what, 20 of these
things. Are we getting near the end?

MILBANK: We`re getting near the end of debates that people will
actually watch. But no, there`s still several to go. Don`t you worry,
we`ll have plenty of (INAUDIBLE)

MATTHEWS: There`s a strange sort of development going on. I`ve
noticed that the polling seems to show a shift towards Romney without any
real reason. It`s not like he`s shown great skill in these debates. It`s
not like he`s made some really interesting points.

A new poll out today from "The Washington Post" and ABC, for example,
takes a look -- take a look at this. Mitt Romney has surged to a strong
lead nationally among likely Republican voters. He`s gained 5 percentage
points since last month. Newt Gingrich has dropped sharply. Look at that
drop, 13 points. Now he`s a distant second, followed by Ron Paul and Rick
Santorum.

Susan, I always kid -- and I -- I mean, I don`t kid, I notice the
weird culture of the Republican Party. Once people see who`s sort of the
front-runner, they get in line. They don`t fall in love, they fall in
line.

PAGE: That`s right, and they often -- typically nominate the next
person in line, which it looked for a while they weren`t going to do this
time, but now it looks like they will.

MATTHEWS: What is it about their culture? You study these people,
these Republicans.

PAGE: Well...

MATTHEWS: What is it that makes them find out who`s the person
they`re supposed to vote for and then vote for them?

(LAUGHTER)

PAGE: Well, I think there probably are many traits that determine
whether you`re going to feel like you`re a Democrat or feel like you`re
Republican. And the fact is, invariably in modern times, whoever leads
after New Hampshire in the Republican primary gets the nomination. Not
true for Democrats. Democrats are still willing to...

(CROSSTALK)

MATTHEWS: OK, good. I like this because this may futz up the whole
thing. Who won the Iowa caucuses? It`s possible that there was a
miscount.

MILBANK: Right, and...

MATTHEWS: And that Romney may not be on the road to winning the first
three. He may have only won at home in New Hampshire, New England, and he
may lose this because the word will get out by Friday and Saturday, as
people are voting, that Santorum may have won. We`ll know by Friday,
apparently.

MILBANK: And a lot of good it did Al Gore to win the tally in 2000.
But...

MATTHEWS: Well, you say.

MILBANK: Well, I say just what you guys were just saying a moment
ago, is Republicans, they like order. They like following instructions...

MATTHEWS: But suppose the wrong orders were issued?

(CROSSTALK)

MATTHEWS: But see, this is the conundrum!

MILBANK: ... rallying around (INAUDIBLE)

MATTHEWS: But suppose he didn`t win Iowa and the wrong orders went
out and the Republicans who get in line and do what they`re told to do are
voting for the wrong guy, they should be voting for Santorum, if he won?

MILBANK: It`s all Dr. Strangelove here.

MATTHEWS: Democrats, on the other hand, totally disobey everybody.
They do what they feel like doing.

PAGE: Well, and they like to date around. You know, they like to
flirt with this person and that person and...

MATTHEWS: They like to rumble. They have fun. Democrats are more
fun. Anyway, this is getting a little bit sultry, isn`t it?

Thank you, Dana Milbank, and thank you, Susan Page. We`re watching
the Republicans do what they do.

Coming up, once again, the rowdy crowd was the big story at last
night`s debate. We`re going to talk about the more aspects -- the stranger
aspects of last night. What were they saying about the Republican Party,
what it really believes in? You learn a lot from these crowds, what they
like to cheer, let the guy die who doesn`t have insurance, fry the people
who are on death row quickly -- very interesting commentary coming from the
crowd.

You`re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Well, here`s something interesting. Nancy Pelosi, the top
Democrat in the House of Representatives, is tweaking Republican front-
runner Mitt Romney. Listen to what the former speaker said about why
conservatives are still resisting Romney.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), MINORITY LEADER: If the far right thought
that Romney could win, they might be more enthusiastic about him. But they
don`t share -- they question what he stands for and they don`t think he`s
going to win. So what -- you know, what`s the sell? I`m not sure he knows
what he stands for, and that makes it harder, too.

(END VIDEO CLIP)

MATTHEWS: Well, she`s raising the electability issue in November,
obviously. Pelosi also said Democrats have 75 House districts they`re
looking at right now and need to play (ph) in at least 50 of them if they
hope to win back the 25 seats they need to take back control of the House
and for her to become speaker again.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: Well, this is going to be a hot one. Welcome back to
HARDBALL. Besides the attacks on Mitt Romney and the sparring between Rick
Santorum and Newt Gingrich, the one thing that sticks out about last
night`s debate for many people is the rambunctious Republican crowd itself.

Take a look at the response from the crowd when Gingrich gets --
Gingrich himself gets when debate moderator Juan Williams asks if one of
Newt`s earlier statements was insulting.

(BEGIN VIDEO CLIP)

JUAN WILLIAMS, FOX NEWS CONTRIBUTOR, MODERATOR: Speaker Gingrich, you
recently said black Americans should demand jobs, not food stamps. Can`t
you see that this is viewed, at a minimum, as insulting to all Americans
but particularly to black Americans?

GINGRICH: No. I don`t see that.

(CHEERS AND APPLAUSE)

(END VIDEO CLIP)

MATTHEWS: Well, the crowd, largely white, if not entirely white,
agree with him. Republican strategist Ron Christie joins us now and
Politico chief political columnist -- Politico columnist Roger Simon join
us.

Ron, thank you for joining us. I -- there were a couple points last
night that really bugged me about that crowd. They seemed to get a big
chuckle out of the fact, when Newt Gingrich referred to Juan Williams by
his first name, Juan -- just calling him Juan seemed to get a chuckle out
of them -- in fact, a big applause.

What was going on in that room last night with the issue of food
stamps? What was really going on, do you think, in the conversation there,
or was it going on?

RON CHRISTIE, REPUBLICAN STRATEGIST: Well, with Speaker Gingrich, I
think, first of all -- good evening, Chris. I think fist what he was
trying to do was play to the crowd. He`s the guy who`s trying to appeal to
the social moderates and say, I`m your candidate, be with me, support me.
And I think he was playing to the audience.

As far as the Welfare comment, unfortunately, it`s true. But I think
the way that the speaker said it was a little bit clumsy. It is true that
we have a very high African-American unemployment rate, 15.8 percent. The
overall black male unemployment rate in this country now is at 19.9
percent.

We have a lot more folks who are of color who are unemployed right now
than before this administration started. But his approach, I will concede,
is clumsy. You shouldn`t just say black folks need a job, rather than a
welfare check.

(CROSSTALK)

MATTHEWS: No, he didn`t say welfare check. He kept saying food
stamps over and over again.

CHRISTIE: I concede that point, Chris.

My point is, why don`t we say we create a climate in this country that
all Americans, regardless of the color of your skin, have the better
pathway to get a job if they are unemployed, rather than say, oh, well, you
should just get food stamps? That`s my whole problem with this issue.

MATTHEWS: Roger, what do you think of the terminology? Well, let`s
take a look. I want you to get a little richer look at last night. For
everybody watching how missed last night, here`s another exchange over
race, I believe, between Williams and Gingrich which led to one of the
biggest applauses of the night.

(BEGIN VIDEO CLIP)

JUAN WILLIAMS, FOX NEWS: My e-mail account, my Twitter account has
been inundated with people of all races who are asking if your comments are
not intended to belittle the poor and racial minorities.

You saw some of this reaction during your visit...

(BOOING)

WILLIAMS: ... to a black church in South Carolina.

(BOOING)

WILLIAMS: It sounds as if you are seeking to belittle people.

(BOOING)

NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: Well, first of all, Juan,
the fact is that more people have been put on food stamps by Barack Obama
than any president in American history.

(CHEERING AND APPLAUSE)

GINGRICH: Now...

(END VIDEO CLIP)

MATTHEWS: Roger?

ROGER SIMON, CHIEF POLITICAL COLUMNIST, POLITICO: This is not Newt
Gingrich being clumsy. This is Newt Gingrich being arrogant,
condescending, and dismissive.

The only thing you could say in his favor is that he`s arrogant,
condescending, and dismissive to a lot of people, white and black. But in
that audience, with that kind of bloodlust in the air, an audience that was
way over the line and way over the top, Gingrich was playing a dangerous
game by playing to the audience and baiting people and appealing to their
worst instincts, instead of their better instincts.

(CROSSTALK)

CHRISTIE: Roger, what do you mean by that? There`s no question you
have a very conservative audience, but you say it`s very dangerous, it`s
bloodlust.

Look, Juan Williams is a mentor of mine. He`s a friend. He can take
care of himself. I think he legitimately asked a question. You have seen
Speaker Gingrich be very arrogant and condescending to other moderators.
You have seen some of other Republicans be dismissive of the moderators.

Just because Juan happened to be black, I don`t think that the speaker
was trying to bait him or bait the audience based on the color of Juan
Williams` skin. I just entirely dismiss that.

SIMON: I didn`t say it was based entirely on the color of Juan
Williams` skin.

(CROSSTALK)

CHRISTIE: But you said it is dangerous.

(CROSSTALK)

SIMON: It is. It is dangerous.

The fact is there`s no reason on earth for Newt Gingrich, who had been
addressed by Juan Williams as Speaker Gingrich, his highest title, to refer
to Mr. Williams as Juan in that long, drawn-out way of his.

It -- and then pausing for the applause. You also saw him pause for
the laughter to build earlier. Newt Gingrich is very, very good at dealing
with an audience, at being silent so the audience reaction can build. The
other candidates usually just answer the question.

MATTHEWS: You`re too nice about this. I think I will be blunter.

Let me ask you, Ron, a question, because you and I are friends, and I
just want to ask you about -- and colleagues. I just want to ask you, I
think there`s a history here we can`t ignore, a context.

Ronald Reagan, who had some good things about him, people will argue
on both sides -- both sides will say he`s done some good things -- would go
around and campaign about talking about the young buck in line using food
stamps to buy gin or vodka with in the Safeway line. He`d use that term,
young buck.

And that would bother people to watch that go on. He would talk about
welfare queens.

CHRISTIE: Right.

MATTHEWS: Do you deny there is a history of this kind of dog whistle?
I`m just asking. Do you deny it?

(CROSSTALK)

CHRISTIE: I would say that, of course, on both sides of the aisle,
there is.

(CROSSTALK)

MATTHEWS: No, in this particular use of language about poor people?

(CROSSTALK)

CHRISTIE: Well, no, Chris, come on.

(CROSSTALK)

MATTHEWS: I`m asking. If you don`t agree, then just say, I don`t
agree.

CHRISTIE: Chris, I think in decades past, you have seen that.

I think the Republican Party has made a concerted effort to be very
inclusive of all people, regardless of the color of their skin. Let us not
forget, my friend, who was it who tried to block the Civil Rights Act of
`64? The Southern Democrats, who tried to filibuster it.

MATTHEWS: Certainly.

CHRISTIE: I think both parties have had a history of race that has
not been good. And I think both parties need to address the issues that
confront us and get beyond the dog whistle, as you say, of playing to
people`s racial insensitivity, regardless of the color of the skin and
regardless of the party of which they`re in.

MATTHEWS: OK. Let`s go on to Rick Perry. I agree with you. I wish
-- I would just like to talk about the present.

But here`s Governor Rick Perry receiving an enthusiastic round of
applause from the same crowd down in Myrtle Beach, South Carolina, when he
said that two Southern states, his and theirs, were in conflict, even at
war with the federal government over voting rights.

Let`s watch here. Let`s listen.

(BEGIN VIDEO CLIP)

GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: I`m saying that the
state of -- of Texas is under assault by federal government. I`m saying
also that South Carolina is at war with this federal government and with
this administration.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

MATTHEWS: You know, there`s a "Birth of a Nation" aspect to that. I
can`t even start with it, voting rights, at war with? This sounds like
"Gone With the Wind." What is he talking about war with? What are we
talking about here?

(CROSSTALK)

SIMON: ... he`s not playing to the audience there. This is South
Carolina, a state where people proudly tell you they were the first state
to secede from the Union.

Rick Perry began his campaign by saying Texas had a right to secede.
He said he wasn`t advocating it, but he said Texas had a right to do so.
This is the state of John Calhoun.

(CROSSTALK)

MATTHEWS: I think Ron is going to wait.

Ron, are you waiting for them to say nullification before you blow the
whistle? When are you going to say, enough, guys?

(CROSSTALK)

SIMON: There`s not a man on that stage who does not believe in
states` rights.

CHRISTIE: I actually am the one to say enough.

Look, there are states, Texas is one, South Carolina is another, that
are at conflict with the federal government. I think it`s an absolute
legitimate right for a state to impose their own qualifications to vote,
have folks product identification.

But for Rick Perry to suggest that they are at war with the federal
government, we`re not at war with the federal government. We`re at
conflict. We`re a good nation. We do things civilly. I just think that
that was red meat to the crowd because he wants to be the states` rights
guy. I understand that. But he needs to really ratchet the rhetoric down.

MATTHEWS: Yes. OK. Thank you all. I think we agree on that one.
Ratchet it down seems to be out there.

SIMON: Red meat for the crowd.

MATTHEWS: Red meat.

(LAUGHTER)

MATTHEWS: Feeding time at the lion cage.

Anyway, thank you, Ron Christie. Thank you, Roger Simon.

Up next, Barack Obama pokes fun at himself with a birthday greeting to
"Golden Girl" Betty White at 90. Oh, this lady is 90. I remember her from
"September Bride."

Anyway, you`re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Back to HARDBALL. Now to the "Sideshow."

First up, to the birthday bash. Today marks the big 9-0 for the
enduring Betty White. Celebrities galore came out to honor her last night
with a television tribute. One guest who couldn`t make it, President
Obama, but he recorded a video message for the guest of honor.

Let`s watch.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Dear Betty, you look so
fantastic and full of energy, I can`t believe you`re 90 years old. In
fact, I don`t believe it.

That`s why I`m writing to ask if you will be willing to produce a copy
of your long form birth certificate.

(LAUGHTER)

BARACK OBAMA: Thanks. And happy birthday, no matter how old you are.

(END VIDEO CLIP)

MATTHEWS: Well, another birthday falls today, first lady Michelle
Obama, herself, the first lady. The president didn`t ask her for her birth
certificate.

Next up, major letdown. Just last week, the South Carolina newspaper
"The State" went out on a limb and chose to endorse Jon Huntsman. Well,
when news came yesterday that Huntsman`s candidacy was no more, one editor
was particularly crushed -- quote -- "It is rather like having gone through
a courtship for some period of time and finally making love with a man, for
him to suddenly turn around and say, you know what? I think I`m gay."

Well, I guess that`s one way of putting it.

And, finally, grilled. Back in 2007, Mitt Romney made the confession
that his hunting skills were mostly limited to small varmints. Well, sadly
for Romney, the topic resurfaced in last night`s debate. Let`s watch.

(BEGIN VIDEO CLIP)

WILLIAMS: You were teased mightily a few years ago to say you hundred
varmints. I just wonder if you have gone hunting since `07.

(LAUGHTER)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I`m not going to describe
all of my great exploits.

But I went moose hunting, actually -- not moose hunting -- I`m sorry -
- elk hunting with friends in Montana. I have been pheasant hunting. I`m
not the great hunter that some on this stage, probably Rick Perry -- my
guess is you are a serious hunter. I`m not a serious hunter.

PERRY: I think you`re probably right.

ROMNEY: But I must admit I have...

(LAUGHTER)

ROMNEY: I guess I enjoy the sport. And when I get invited, I`m
delighted to be able to go hunting.

(END VIDEO CLIP)

MATTHEWS: So, Republicans really do cling to their guns.

Anyway, up next, opponents of Wisconsin`s union-busting Governor Scott
Walker are turning in hundreds of thousands of signatures, maybe a million
demanding his recall. And in the process, they are mobilizing the
Democratic base for November in a crucial presidential state. That`s
ahead.

You`re watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

BRIAN SULLIVAN, CNBC CORRESPONDENT: I`m Brian Sullivan with your CNBC
"Market Wrap," where the stock rally continues. The Dow ended the day up
60, the S&P up about five, the Nasdaq up right around 17 points.

Shares of Carnival Cruise Lines though fell nearly 14 percent, this
after analysts slashed the ratings and estimates of the company. Carnival
owns the Costa Concordia. That`s the cruise ship the capsized off the
coast of Italy. Latest reports have 11 dead, with more still missing.

Banking giant Citigroup reported revenues and earnings short of
expectations. The company said weaker bond trading and investment banking
revenues were to blame. Shares ended the day down about 8 percent. In the
meantime, Kraft Foods shares rose today. The food giant said that 2011
revenue would be up about 10 percent and that profits would also be
slightly higher.

Sadly, that`s not going to help the jobs picture. Kraft also said
that it will cut about 1,600 jobs as it realigns.

But maybe some good news for homeowners. Natural gas futures closed
at a near 10-year low. Prices are down 44 percent from a year ago.
Climate experts said that this past December was the sixth warmest on
record. Many of you likely heat their home with natural gas. So,
hopefully, those bills will go down.

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

(BEGIN VIDEO CLIP)

GOV. SCOTT WALKER (R), WISCONSIN: This is why this, my election,
which appears to be a recall election, is going to be such a big deal, I
think, because this is one of those defining moments not only in
Wisconsin`s history, but I think believe as part of the national political
landscape. This will be one of those defining moments as well.

(END VIDEO CLIP)

MATTHEWS: Well, you talk about HARDBALL. Welcome back to it.

Wisconsin Governor Scott Walker knows the stakes are high. There here
is looking defensive. Today, the Democrats in the state filed petitions
with more than a million signatures to trigger that recall election. To
illustrate what a huge showing this is, Democrats needed just 540,000
signatures for a recall. Got double that, in fact, got half the electorate
to come out with these signatures.

When Governor Walker took on public sector labor unions last year, the
angry response from union supporters made Wisconsin ground zero in labor`s
fight for survival. With a recall looming, national political attention,
money and media all began to focus on that state, one that has a must-win
reality for the president.

Ed Schultz is our colleague, host of MSNBC`s "THE ED SHOW." And he`s
broadcasting tonight from Wisconsin. Mike Tate joins us. He`s also --
he`s the Democratic state chair out there.

Mike, thanks for joining us.

I want to start with my colleague Ed.

Ed, this is such an astounding performance by any electorate, by any
organized labor group. They have been able to collect, as you know, you
are the expert now, you have been the chief, maybe the top champion on the
air of this -- they have basically got as many signatures as half the
electorate. They have got enough, if they get those people all to vote,
they win this thing.

ED SCHULTZ, HOST, "THE ED SHOW": It`s utterly amazing, Chris.

You`re talking about 25 percent of the electric -- electorate, as
opposed to about 7 percent when they did the recall on Gray Davis in
California. It`s a monumental effort.

I got to tell you, I was in the backyard of a middle-class family
today where they were hiding the truck, the U-Haul that had almost two
million signatures, armed guards who we were asked not to film because they
wanted to make sure that these signatures were going to get to the
Government Accountability Office.

You open up the back, there they are. And there`s the ransom. It was
almost like we were doing a "James Bond" movie. You are looking over your
shoulder and wondering what is going on.

But the intensity of these folks and the due diligence is what they
have done is really politically record-breaking in this country. There
were enough signatures delivered today to recall the governor, the
lieutenant governor, and four sitting Republican senators, including the
Senate majority leader.

So to say that this state is energized really is an understatement.
And I want to say that it wasn`t all labor. This was put together by the
Democratic Party.

MATTHEWS: OK.

SCHULTZ: And a grassroots organization really did the -- the -- the
legwork, One Wisconsin Now, a very progressive group.

The labor folks have really kept their powder dry to this point. But
what they`re really going to do is engage in this recall effort from this
point on.

MATTHEWS: Let me go to Mike Tate on that question.

Mike Tate, thanks for joining us.

Do the Irish get to be chair of the Democratic Parties around the
country? What`s the story here? Just kidding.

Let me ask you this. Why didn`t you do so well in 2010? What`s the
difference between 2010 and 2012 politically in your state in Wisconsin?

MIKE TATE, WISCONSION DEMOCRATIC PARTY CHMN: Well, first, Chris,
thanks for having me on. I`m a huge fan of HARDBALL.

MATTHEWS: Thank you.

TATE: You know, 2010 was a bad year for us. You know, the national
momentum, as you know, was not going our way. You know, we had a Ron
Johnson come on and spend a ton of money, outspent Senator Russ Feingold,
go down in a tough defeat. And, you know, we had Mayor Tom Baric go down
in a close election to Scott Walker.

But, I think, today, collecting over a million signatures, getting
almost as many signatures as Scott Walker did votes, it sends a signal of
exactly where Wisconsin is. That Scott Walker tried to jam down this
radical agenda. He didn`t campaign on it, Chris. He didn`t tell the
people of Wisconsin what he was going to do. And that`s why people are so
upset here. And that`s why I believe we`re going to have a successful
recall of the governor.

MATTHEWS: Well, here`s why the Wisconsin recall election, we`ll
watch it right now, will have repercussions for the 2012 race. In 2008,
President Obama made a clean sweep of the states in the Scranton to Oshkosh
corridor. Look at across, look at the ones with the white flag on there,
including a blob in Wisconsin where he beat John McCain by 14 points in
Wisconsin. And before the 2010 election, the governors of those states
tilt to Democrats.

Also, here`s six of the eight states shown in blue had Democratic
governors. That changed dramatically in 2010 elections when power flipped
in these industrial Midwest states. Now, just two of the eight have
Democratic governors.

So back to you, Ed. This politics, I know you`re mainly a labor guy.
Not a partisan. You`re interested in labor rights for middle class people.

What`s this mean in terms of just economics in this country?

SCHULTZ: Well, I think it means a lot, Chris, because this story
goes far beyond the borders of Wisconsin. And Scott Walker has got it
right. I mean, this has got national ramifications because this is a
template to work against Citizens United.

There`s millions of dollars coming into the state trying to save him
and these other senators who have put forth a radical agenda that goes
after middle class wages, pension, retirement, the whole thing, health
care. And so, this really is a template on how to fight back.

Now, in 2010, an answer to your question, it was simple apathy. It
was people who were lazy and didn`t get engaged.

MATTHEWS: Yes.

SCHULTZ: And when I get on the ground here in Wisconsin, I said this
is going to motivate people. This is going to focus people on just how
important 2012 is. And the big beneficiary of this should be President
Obama and the Obama campaign.

And it should be a wakeup call, as we saw in Ohio and Indiana. Right
to work is a huge issue. There`s being labor issues going on in Michigan.
So, I mean, these radical governors that came in, this is really, I think,
an overreach and a response to an overreach.

MATTHEWS: Yes.

SCHULTZ: And it`s a ground swell response to an overreach. And I
think it does play really big in these states in 2012.

MATTHEWS: Let me go back to Mike Tate, the Democrat.

You know, I grew up with a fact that there was big labor. I remember
working in the Senate for years ago. I mean, a long time ago when people
like George Meade, the head of the AFL-CIO would come in. And Republican
senators would rush over to light his cigar. I mean, that sounds like a
thousand years ago, when big labor was truly big labor -- bigger than the
Fed chairman, bigger than the guy from the Fed, AFL-CIO. It was more
important than the Federal Reserve politically.

Do you see that coming? I don`t mean overnight, but you see a growth
of labor where it could become a real part of the progressive coalition in
this country, politically in delivering big states like Wisconsin? Go,
Mike.

TATE: Look, I hope so. I think labor has been critical in
delivering Wisconsin in any number of races. You know, in any given
Sunday, Chris, big labor is about 25 percent of the electorate here, which
is a pretty big state. We have been a strong labor state.

But I think we have we absolutely need an expansion of labor and
collective bargaining rights because I think it`s people`s ticket into the
middle class. And I think that`s what people are hungering for right now
is how to live their life with just a little bit more so they can get by.

MATTHEWS: OK. It`s great to have you on. Mike -- go ahead. Last
word, Ed.

SCHULTZ: You know, the big thing is, 80 percent of labor membership
is concentrated in 16 states in this country. A lot of this pushback in
Wisconsin is because a lot of middle classers feel like that the governor
is trying to balance the budget on the backs of middle classers. It`s one
of the first things he did when he came in as governor was to give tax cuts
to the rich and the corporations, which has not resulted in big job growth.

MATTHEWS: Yes.

SCHULTZ: So, this is a pushback from the middle class as much as it
is the labor sector.

MATTHEWS: Sounds like a big national story. Thank you, Ed. Ed
Schultz, my colleague, coming on tonight to talk a lot more about it. Mike
Tate, you`ll be on right after us at 8:00 Eastern.

Mike Tate -- nice to meet you, buddy. Happy St. Patrick`s Day.

Up next --

TATE: Thank you, Chris. Great book.

MATTHEWS: -- the incredible story of that cruise ship that you mean
"Jack Kennedy: Elusive Hero," best seller for 10 weeks? That one? Thank
you.

Anyway, off the coast of Italy, we`ve got a new tape of that cruise
liner. What a sight. What a sight. The captain abandoned ship and was
ordered back to get back on the ship and wouldn`t do it. What a story.

Harry Smith is going to bring that story from NBC.

This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: President Obama is trying to recreate the Mile High magic
on the final night of the Democratic National Committee -- convention,
rather, in Charlotte. President Obama will deliver his acceptance speech
at the Bank of America Stadium, the 74,000-seat home of the Carolina
Panthers football team.

Four years ago, Obama gave his speech at Mile High Stadium in Denver.
The president hopes to mobilize voters in North Carolina, a swing state,
and key one for him. The same way his 2008 speech energized Colorado
voters.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: We`re back.

Incredible images from Italy of that cruise ship, the Costa
Concordia, which hit a reef the Italian coast and ran aground. Five more
bodies all wearing life vests were found on board, bringing the death toll
to 11. Over 20 people remain missing, including an American couple from
Minnesota. The ship carrying 4,200 passengers hit rock as it sailed off
course, supposedly to show off the boat to the home island of the head
waiter of the craft, a favored from the captain.

But after the impact, the captain turned it around and beached the
vessel.

Transcripts of the conversation between the Italian coast guard and
that captain, Francesco Schettino, tell a haunting story -- a captain who`s
left the ship, giving excuse after excuse why he won`t go back onboard all
while passengers still struggle to survive. That captain was placed on
house arrest today, charged with causing the wreck, abandoning ship and
manslaughter.

Harry Smith is an NBC News correspondent, just back from covering
this story for Italy for "Rock Center" and NBC News.

Harry, we are going to play that crazy conversation, horrible
conversation. What`s your report on this, what looks to be just a human
catastrophe, manmade horror?

HARRY SMITH, NBC NEWS: This guy has got to be the anti-Sully. You
think about people in charge and people doing the right thing, this guy
couldn`t have screwed up any more than he screwed up. We were on the water
right next to that ship yesterday -- yesterday morning, and the enormity of
the ship, all the technology in the world this never should have happened.

This guy went miles off course to come close by that Giglio Island
and the rocks he hit and the graphic you showed before, you can actually
see the rocks from Google Maps.

MATTHEWS: Yes.

SMITH: The rocks even have a name. They`re called the Secaldella
Scola (ph).

This guy, if in fact everything that looks like happened happened,
this guy is one of the biggest screw ups of all time.

MATTHEWS: Well, an Italian coast guard officer repeatedly told the
captain, Schettino, to get back onboard that ship as it was sinking once he
realized he had left the Costa Concordia.

But the captain gives several excuses why he can`t get back aboard
the ship. Here`s a portion of that transcript. Let`s listen to it in
Italian.

OK. The coast guard. Go.

"There are already bodies, Schettino." Schettino, "How many bodies
are there?" Coast guard, "I don`t know. I`ve heard of one. You are the
one who is supposed to tell us how many there are." That`s the coast guard
speaking.

Here is the captain, Schettino, "But do you realize that it`s dark
here and we can`t see anything?" Coast guard, "And so what? You want to
go home, Schettino? It`s dark and you want to go home, get on that prow of
the boat, using the pilot ladder around tell me what can be done, how many
people there are and what their needs are. Now!"

Eventually, Schettino says he`ll return on board but the coast guard
denies he ever went back -- Harry.

SMITH: No, there were people -- there were people who saw this guy
in a lifeboat. There were still, you know, maybe several hundred people
still onboard the ship and there were people out in the water that said,
oh, my God, that`s the captain of the ship. He is in a lifeboat.

There are even reports that he was on -- on his cell phone with his
mother while there were still people on the ship. He is on shore on his
cell phone telling his mother he is OK.

MATTHEWS: Let me ask you about the tragic part of this just gone
through the tragic comic part. What happened to the people that got
killed? They were in their life jackets? How did they -- they get -- were
they forced down below the ship as it was listing or what happened?

SMITH: Well, a couple of scenarios here. One is you see how this
thing is listed, it is all the way on its side. If you are in a state
room, think about this for a second, all of a sudden, the door to the
hallway is the ceiling, right? If you are of a certain age, if you are of
a certain weight, there`s -- you`re not going get out of that room if
you`re trying to get to the ceiling to get out into the hallway to somehow
work your way out of that ship. It`s just an impossibility.

One of the other things they said is with the electrical power going
on and off, on and off, it might have tripped the locks so that, just like
in a hotel room, sometimes if the power goes out, that lock goes down.
There`s -- you can`t swipe a card, there`s nothing you can do to unlock the
door.

MATTHEWS: Horrible.

SMITH: That may be one of the other -- that`s not -- that`s just a
theory. So think about all of a sudden the door, your escape door is
suddenly the ceiling and the other one is even if you could get to it,
maybe it`s locked and you can`t get out.

MATTHEWS: Oh, God, and they are in their life jackets, they know
exactly what`s going on.

Harry, thank you for that -- I said tragic comedy, it`s just going to
end up tragic.

When we return, "Let Me Finish" with Newt Gingrich -- this is a
social issue we have in this country. It`s called race.

You are watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: "Let Me Finish" tonight with this:

Newt Gingrich has called Barack Obama a food stamp president -- food
stamp president. Got it?

I thought we were past all this, didn`t you? You know, the talk
about welfare queens and phrases like what? Well, you either get the
message or you don`t. If you don`t, there`s no point arguing with you
about it. Most people do get the point -- meaning most people, white and
black, get the point.

Speaker Gingrich went at Juan Williams last night in that debate in
just as vain. He knew what he was doing. Williams asked if Gingrich could
see that -- saying that black Americans should want jobs not food stamps
was insulting. Gingrich then laid into him, saying that President Obama
had put more Americans on food stamps than any other president. He got a
lot of applause for that.

Why would saying that get you a big, hearty applause? Because this
whole conversation isn`t about poverty but about race. It`s about a
candidate who knows just how to make his point to appeal to a certain kind
of voter, I`m talking about Gingrich here. Again, there`s no point arguing
this -- you either hear the code being used or you don`t.

Someone talking about food stamps, bringing up food stamps, calling a
president a food stamp president, when no one else on the planet is talking
about food stamps, knows precisely what he is talking about. It`s a
cartoon -- a cartoon that the people getting public assistance are lazy,
don`t want to work and are black. You talk about how low this campaign has
gotten? Lookie here.

And, by the way, next time you are in Washington, D.C. or any other
big urban area, I`ve got an educational trip for you to take. Get up
early, earlier than you usually get up, say about 6:00 or 630 in the
morning and drive through the poor parts of town, and watch who is up
waiting at the bus stops, heading to work -- poor people, a lot of them, a
lot of them black, and they are the hardest working people in the country.

Gingrich is a smart guy. He ought to be ashamed of himself.

And that`s HARDBALL for now. Thanks for being with us.

"POLITICS NATION" with Al Sharpton starts right now.

AL SHARPTON, "POLITICS NATION" HOST: Welcome to "POLITICS NATION."
I`m Al Sharpton.

Tonight`s lead -- when is a statement just an accidental misstatement
of facts? And when is it a lie?

This election will be fought over the issue of jobs. It`s what
people are desperate for in this country. We need ideas. We need
solutions. What we don`t need is the disappointing answer we got from GOP
frontrunner Willard Mitt Romney.

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

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