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updated 8/24/2012 10:51:11 AM ET 2012-08-24T14:51:11

HARDBALL
August 23, 2012

Guests: Rick Tyler, Robert Costa, Michael Hastings, Spencer Ackerman, Kim Barker

CHRIS MATTHEWS, HARDBALL HOST: How much trouble is Akin makin`?

Let`s play HARDBALL.

Good evening. I`m Chris Matthews out in Los Angeles for the "Tonight"
show tonight.

But "Let Me Start" with Mitt Romney and the kind of president he
thinks he should be. Now hear this. If you want to speak to Mr. Romney
now and presumably in the future, you are not -- repeat, not -- to ask him
about what he doesn`t want to be asked about.

Today`s blacklist of questions, anything on Todd Akin, anything on
abortion. Them`s the rules, we`re told. You want to talk to Mr. Romney,
you ask him about what he, Emperor Haile Selassie, says he wants us to talk
about.

Has it gotten this bad? Are we now in the world of third world
dictatorships where the big man -- in this case, Romney -- operates by
decree, Ask not what your country can do for you, ask what I tell you to
ask?

Let`s hear from Rick Tyler right now and Ron Reagan. I want to start
with Ron Reagan on this baby. Have you seen this story that`s out today?
This CBS affiliate reporter said that in order to get an interview with the
candidate of the Republican Party for president, it is important that you
not ask any question about what`s in the news right now. You must not ask
about Todd Akin. You must not anything -- (SIC) anything about the party`s
position coming up this Monday in the platform fight over -- about
abortion. These are the rules.

RON REAGAN, AUTHOR, "MY FATHER AT 100," MSNBC POLITICAL ANALYST: I
don`t understand how he thinks that this is going to fly. It`s certainly
not going to fly in televised debates, where he`ll look like a fool if he
takes that sort of stance. And I don`t think it`ll fly out on the trail,
either.

I mean, you`ve got a whole bunch of reporters following you around.
If you tell them they can`t ask a certain question, what do you think the
first question out of their -- across their lips is going to be?

(LAUGHTER)

MATTHEWS: I know.

REAGAN: Of course they`re going to about Akin and abortion and
everything else. These are legitimate questions.

You know, he strikes me as a guy who`s kind of the CEO who`s just used
to getting his own way, that he can tell anybody anything, you know, You
can`t do this, you can`t do that, and everybody`ll genuflect and bow down
to him. It doesn`t work that way when you`re running for president.

MATTHEWS: You know, Rick, it reminds me of what I know is the
difference between political press and the business press. A CEO of a
major U.S. corporation could deny access to the press and perhaps protect
himself or herself from any coverage.

But if you`re running for president, you`re not dealing with the
business press, you`re dealing with the happy-go-lucky, insistent, highly
professional political press that knows what the headline is tonight and
goes for it.

RICK TYLER, REPUBLICAN STRATEGIST, FMR. GINGRICH SPOKESMAN: Well, I
would add if you`re president of the United States, you can avoid the press
for two months and only take a press conference when bad news hits the
Republican Party, which was the exact morning that the president decided to
hold his first press conference in two months, because the Todd Akin story
had hit the fan. So Chris, come on! How can you say --

MATTHEWS: Has President Obama ever told --

TYLER: -- that Romney`s trying to control --

MATTHEWS: -- the press not to ask him any questions? Don`t ask me
about what`s in the news?

TYLER: And the president won`t even face the press! So --

MATTHEWS: Oh! Excuse me. There`s a difference between not having a
press conference and dictating what the questions should be at the press
conference.

TYLER: Wait a minute.

(CROSSTALK)

TYLER: Doesn`t the president stand up there every time he does a
press conference and list off the names of the people? You don`t think all
those questions --

MATTHEWS: True, but he doesn`t list the questions.

Here`s the background, by the way, so we get the facts straight, Rick,
before you blow the horn so loud. Today, a reporter from the Denver
affiliate of CBS says she was given a set of rules limiting her interview
with Mr. Romney -- no questions on Congressman Todd Akin or abortion.

Let`s hear how she explains it.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Political specialist Shaun Boyd just finished an
interview with Romney just literally a couple of minutes ago! Shaun`s with
me now. And Shaun, you were one of only four local reporters to get to
talk to him. And what did you ask him?

SHAUN BOYD, POLITICAL SPECIALIST: You know, I had about five minutes
with him, and we got through a fair amount of material, actually, in that
five minutes. The one stipulation to the interview was that I not ask him
about abortion or Todd Akin. He`s the Missouri Republican who created a
firestorm after saying women`s bodies shut down in a "legitimate" rape to
prevent pregnancy. I did ask him about health care, the female vote and
energy --

(END VIDEO CLIP)

MATTHEWS: Well, the Obama campaign quickly circulated a statement
highlighting the fact that no questions on Akin or abortion were allowed in
that interview.

Quote, "It`s no surprise why. On Tuesday, the Republican Party
officially endorsed the Akin amendment, which would ban abortion for all
women, including rape victims. And Paul Ryan has struggled to explain his
support for redefining rape.`` Forcible rape, he calls it. ``Mitt
Romney`s campaign might be able to muzzle reporters from asking tough
questions, but women across America deserve to know the truth about Romney-
Ryan`s extreme agenda."

Anyway, that`s party talk there, of course. We should note that the
Romney campaign pushed back on the story this afternoon, but their
spokesperson didn`t specifically deny it, either.

So Rick, I want to go back to you because you`re argumentative
tonight, which is appropriate on HARDBALL. Do you think that they can talk
their way out of this by saying, Oh, this was an odd case, we generally
don`t proscribe (SIC) what a reporter`s supposed to not ask?

TYLER: No, I think, in general, that both the president and the
people running for president, the nominee, Mitt Romney, should in general
not set up ground rules or at least excessive ground rules or dictate what
the press can and can`t ask because it`s -- you`re right. It`s going to
backfire.

I just point out that the president is as guilty as Mitt Romney.

REAGAN: No, he`s not.

TYLER: But I think as a general rule, you should -- you should be --
you should be open to the press.

MATTHEWS: OK, let`s talk about --

REAGAN: No, he`s not!

(CROSSTALK)

MATTHEWS: -- "dictatorship`s" a good word because it used to be
there were party organizations run -- actual Republican Party -- I remember
Will Rogers famously said, I belong to no organized political party, I`m a
Democrat.

But the counterpoint to that is Republicans were an organized party.
They had leaders. They met. They organized to decide whose turn it was,
whether it was W.`s turn or some kid`s turn or whatever. You know how it
works. Except you never got that turn, Ron. That`s the only problem. You
never got that turn you were supposed to get in the Republican Party!

(LAUGHTER)

MATTHEWS: But now, let`s take a look at -- let`s take a look at the
Republican leaders who have trashed this guy, Todd Akin, and have said, Get
out of the race so we don`t have to talk about you. That`s the big story
plaguing Republicans right now. Let`s see this lineup of establishment,
bold print names saying, Get out of the race, and see what happens.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R-MA), FMR. GOV., PRESIDENTIAL CANDIDATE: I can`t defend
what he said. I can`t defend him.

REP. PAUL RYAN (R-WI), VICE PRESIDENTIAL CANDIDATE: He should have dropped
out of the race.

SARAH PALIN (R-AK), FMR. GOV., FOX CONTRIBUTOR: Well, I`m suggesting
that he get out.

SEN. SCOTT BROWN (D), MASSACHUSETTS: I`ve asked him to step down.

GOV. SCOTT WALKER (R), WISCONSIN: I think he should get out.

REINCE PRIEBUS, RNC CHAIRMAN: If it was me and I had an opportunity
to let someone else run to actually give ourselves a better chance of
winning, I would step aside.

(END VIDEO CLIP)

MATTHEWS: Well, those are the bold-face names I mentioned in the
Republican leadership. But it doesn`t seem to matter because people like
Tony Perkins, believe it or not, of the Family Research Council, are still
behind Akin. He has a niche on the right defending him.

Ron, it seems like in the modern Republican Party of the 21st century,
you don`t need the party chairs. You don`t need the party chairwomen. You
don`t need the moderates. You don`t need the people who worry about
winning general elections. All you need is a niche to hide in, to back you
and comfort you on the hard right.

REAGAN: Yes, and you`ll notice that the Republicans who are calling
for Todd Akin to leave are not doing so because they disagree with the
substance, such as it is, of what he said. They simply think that he`s a
loser now and that he`ll lose to Claire McCaskill --

MATTHEWS: Yes.

REAGAN: -- and they might give up their chance to re-take the
Senate. And that`s why they want him to leave.

TYLER: No!

REAGAN: The fact of the matter is that our vice presidential
candidate agrees with Todd Akin. He co-sponsored legislation about
"forcible rape," redefining rape, with Todd Akin. Paul Ryan is Todd Akin,
and Todd Akin is the Republican Party now, to their detriment.

MATTHEWS: Well, isn`t that true, in effect -- Rick, isn`t it true
that when your Republican Party has already drafted and will apparently
ratify this coming Monday, the first day of their convention, that there`s
to be no abortions under any circumstances, even rape, and that`s really
what`s behind -- what`s behind that is Paul Ryan`s argument is that
forcible rape -- even that isn`t -- shouldn`t be included in some of this
personhood amendment stuff.

It is the hard-right philosophy of most of the delegates, apparently,
isn`t it?

TYLER: Well, look -- look, I know -- I know Todd Akin. I`ve met him.
Todd Akin`s an honorable man who said something that was extremely
thoughtless for which he`s apologized for, and for which the entire
Republican Party has condemned him for.

I don`t know what more we can do to him. Perhaps we could dismember
him, just put scissors in the back of his head and suck his brains out, and
that would be (INAUDIBLE)

MATTHEWS: Well, what did he say -- let`s just --

(CROSSTALK)

REAGAN: How about repudiating what he actually said? How about
repudiating what he actually said --

TYLER: Everybody has --

REAGAN: -- and not just complaining --

TYLER: Everybody has repudiated it!

REAGAN: -- that he might not --

TYLER: As far as the --

REAGAN: No, they haven`t! They have not --

TYLER: Yes, they have!

REAGAN: -- specifically --

(CROSSTALK)

REAGAN: -- magical sperm-killing, spermicidal females --

TYLER: Everybody has repudiated that!

(CROSSTALK)

MATTHEWS: OK --

TYLER: That is not true!

REAGAN: None of them have repudiated that! Has Paul Ryan repudiated
that? I haven`t heard him mention that in particular.

MATTHEWS: OK. OK --

(CROSSTALK)

TYLER: I don`t know of anybody --

(CROSSTALK)

MATTHEWS: I want Rick Tyler`s response. Do you disagree with the
charge that this strange commentary that Rick -- that Paul -- or rather
Todd --

TYLER: It was a -- it was a --

MATTHEWS: -- Akin said -- here`s what he said. "There ought to be
some punishment for rape." There ought to be some. What a strange thing
to say. And that`s in that same paragraph. "There ought to be some
punishment, but it should be for the person who did the raping.` But also,
it only should include "legitimate" rape.

And what I think he meant is he didn`t really trust a lot of women
when they said they were raped, and he had this real skepticism about
women`s testimony in court on such a matter, which I thought was really
offensive to an awful lot of women in this country, and men. And for him
to say, I misspoke -- it wasn`t like I got the wrong capital of New Jersey.
I meant to say Trenton. It wasn`t a mistake or a misstatement, it was a
real difference of opinion --

TYLER: Look --

MATTHEWS: -- on principle, I thought.

TYLER: It was a thoughtless statement. We`ve all -- we`ve all said
this over and over again. Yet, the Democrats -- look, our party -- we --
we said it -- we (INAUDIBLE) practically throw him out of the party, which
I think is an overreaction. Yet we can have interns in the White House, we
can have a male prostitution ring in a congressman`s basement. We can have
a member of the Ku Klux Klan as a senior senator from West Virginia, and
the Democrats will defend all that.

Look, this is the one thing -- and as far as radical -- this is --

MATTHEWS: Did you just go back and whip Barney Frank one last time
there?

TYLER: One last time.

MATTHEWS: I mean, did you just do that, went back to Steve Gobi (ph)
again? How far back do you want to go?

TYLER: But Chris, the --

REAGAN: And the fact is, it`s not a difference of opinion. This is
not a difference of opinion. It is a matter of fact.

MATTHEWS: OK --

REAGAN: Women do not have spermicidal secretions when they are raped.

TYLER: That -- that wasn`t the point of --

REAGAN: Todd Akin apparently believes --

TYLER: That wasn`t the point of --

(CROSSTALK)

TYLER: That wasn`t the point of Todd Akin`s question (ph).

MATTHEWS: OK, OK --

TYLER: The question was, Do you -- are you pro-life under all
circumstances --

MATTHEWS: Let`s go back --

(CROSSTALK)

MATTHEWS: I want to go back to a strong position that Rick may hold
here. I`m not sure. I want to give him one good shot here. Rick, does
the Republican Party leadership, people like Romney, the presumed nominee
of the party, Reince Priebus, the chairman of the party -- do they no
longer enjoy true authority in the party? And I don`t mean by power, I
mean authority.

Are they respected as leaders of the party who can say to the
Republicans in Missouri, You shouldn`t have this guy as your nominee for
senator, and therefore, you should find someone else and get him to remove
himself? Have they lost that authority?

TYLER: Well, they`ve all said that. And look, it`s governed not only
by party rules, it`s governed by legalities. And right now, Paul Akin
holds -- I`m sorry -- Todd Akin the cards here. He can decide whether to
run or not.

But look, the leaders only can lead so far as people want to follow.

MATTHEWS: Yes.

TYLER: You can proclaim yourself a leader, but if nobody`s following
you, then -- then they`re not going to follow you. But the party structure
has always been that way. I think that -- you know, it`s -- it`s --

MATTHEWS: But has the hard right, the people very far over on that
side, the Tea Party people, the ones that knocked off -- like Mourdock, who
knocked off -- who was -- Lugar up in Indiana and knocked off -- knocked
off Bob Bennett -- are they really stronger compared to the party
leadership than they were?

TYLER: They`re organized. And they`re organized and they show up and
go to the meetings and they get their people elected and they recruit and
they campaign. And so I other -- if other people with different points of
view, other than -- I imagine you`re talking about the Tea Party, want to
organize, then they can be in charge, too. The Tea Party figured out, We
not only want to protest, we want to participate. And they figured how to
take the levers of power, so that`s what they did.

MATTHEWS: You know, one last thought, Ron. I think you said this
today in one of the interviews today. I think the difference between
President Reagan and the Republican Party today is President Reagan had a
principled concern for a pro-life position, but I don`t think he went
around expending (ph) this kind of extreme action, trying to push it
through and really trying to outlaw and really try to ban it.

I think he said it was wrong to have an abortion, but I don`t really
think he went this far, as these people, who are putting it into the
platform that even if you`re raped, you got to -- you have to have that
baby.

Go ahead. Your thoughts on that.

REAGAN: I think that my father would find that notion appalling. And
I will observe that to my knowledge, he never attended a single anti-choice
rally.

Listen, the Republican Party has created a Frankenstein over the last
decades. They`ve pandered to, cultivated, propagated ignorance. And now
ignorance is coming back to bite them. Now ignorance wants a seat at the
table in the person of Todd Akin, Paul Ryan, and many other members of
Congress who agree with Todd Akin and Paul Ryan about this weird, you know,
female spermicide, "legitimate rape" stuff. There are a lot of Republicans
on that team now.

TYLER: Well, wait a minute, Ron. Isn`t the Democratic Party abortion
in all cases? Didn`t the president give an interview in 2003 --

REAGAN: I believe that after 22 weeks, there are conditions for
abortion, Rick.

TYLER: Let me finish. In 2003, the president said that he would
support abortion in all cases, including third trimester.
And yet the Democratic Party thinks --

REAGAN: You have to show me that quote.

MATTHEWS: I want to see that.

TYLER: I`ll send it to you.

MATTHEWS: OK, thank you, Rick.

REAGAN: OK. Good enough.

MATTHEWS: Thank you, Rick Tyler and Ron Reagan. By the way, one
other applaud (SIC) for your dad, I`ll say this. He would not have taken
us into that idiotic war in Iraq. No way in the world would the neocons
have pushed him into that war, like they did with that guy W., who had
nothing in his head to fight back with.

Anyway, coming up: Who do you trust, in three swing states? When it
comes to Medicare, President Obama has the edge. That`s the news tonight.
But is he ahead by enough to win in those states? Will Medicare help him
win a tough state like Florida?

Also, remember those Navy SEALs who criticized President Obama, they
said, for taking too much personal credit for the raid that got Osama bin
Laden? Well, now some other SEALs are defending the president. They say
the charge that he failed to praise the men who pulled off the mission is
simply not true. Truth ought to matter, don`t you think?

Plus, see if you can guess what two groups are upset by this anti-
Romney ad.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: (SINGING) I`m a Romney girl in a Romney world.
Life is taxes. It`s fantastic. Silver tip your hair, tax shelters
everywhere --

(END VIDEO CLIP)

MATTHEWS: OK, well, half the answer is easy. The Romney campaign`s
upset. But who else?

And "Let Me Finish" tonight with how Romney`s gotten deeper and deeper
in bed with the right wing, thanks to this Akin mess and the hard-right
positions of Paul Ryan.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Will Paul Ryan help Mitt Romney carry Ryan`s home state of
Wisconsin? Well, consider this. The University of Minnesota`s Smart
Politics blog notes that since 1944, there have been eight vice
presidential nominees from the Midwest, and all eight helped their ticket
carry their home state. Wisconsin hasn`t gone Republican since 1984, but
polls there are tightening now.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. Well, Medicare has been front
and center in this campaign all along now, and following Mitt Romney`s pick
of Paul Ryan for a VP, even a bigger issue. But it`s a hot topic that`s
benefiting the president, for sure.

In a new poll conducted by Quinnipiac, "The New York Times" and CBS
News in three battleground states, not only do a majority of Americans want
to keep the program as it stands today, they also believe the president
would do a better job on Medicare generally.

In Ohio, Obama leads Romney by 10 points now, 51 to 41. In Florida,
Obama leads Romney by 8 points, in Wisconsin leads by 9. This is all on
the issue of who will do a better job on taking care of Medicare.

Robert Costa`s a political reporter for "The National Review" and CNBC
"KUDLOW REPORT" contributor, as well. Eugene Robinson`s a Pulitzer Prize-
winning columnist for "The Washington Post," and also, of course, our MSNBC
political analyst.

I want to start with Gene on this. Gene, you know, the old rule of
politics is don`t step into the other guy`s topic because you`ll always
lose. I mean, if you`re a Democrat, don`t be talking about cutting
spending because they`ll probably believe the Republican. You know, it
used to be if you wanted to talk about being tough on the commies, you
would always -- if you were a Democrat, that wouldn`t be your favorite
issue. It would be the Republicans` favorite issue.

Medicare -- Republicans since Ronald Reagan way back in the early `60s
have opposed Medicare. The AMA was their partner in opposing it. Why
would they start talking about something that they`ve never been credible
on?

EUGENE ROBINSON, "WASHINGTON POST," MSNBC POLITICAL ANALYST: Well, I
think they decided to try something different this year, figuring that with
Paul Ryan on the ticket, they were especially vulnerable on Medicare, and
so try to turn the opponent`s strength into a weakness, or at least
partially neutralize the Medicare issue. I think that`s why they decided
to strike first on Medicare.

And I doubt they`re under the illusion that they`re going to win on
this issue, but maybe not lose quite as badly as they otherwise would.

MATTHEWS: Well, let me go to Robert on that because it seems to me if
you`re an elderly person -- and I mean elderly, I mean, 70s, later 70s, 80s
-- and you`re still cooking and you`re still voting and you hear that
somebody`s coming along to tinker with your Medicare, which is the one
thing you`ve been able to count on in your later years -- the one thing was
that you could get your medical bills paid for -- and a guy comes along and
says, I got this new highfalutin idea, I`m going to voucherize it, and
you`re going to go off and find a health care insurance company, I want to
know, what insurance company is going to insure somebody at 82 for health?

I mean, what are we talking about here? The insanity of the Ryan
plan, it just jumps out at me as I got to, first of all, go find the
insurance company and then see what they`re going to charge me. They`re
not going to charge me something cheaper than Medicare.

Your thoughts, though.

ROBERT COSTA, "NATIONAL REVIEW": Chris, you call it insanity. Romney
and Ryan may think it`s pretty cagey.

Look, I have spent three days in the past 10 days with Ryan on the
trail and almost every single speech he gives on the campaign trail, in the
first two or three minutes, he`s right on to Medicare. He doesn`t sidestep
the issue. They`re confronting it directly.

And from what I hear in Boston is that Romney`s whole gamble -- and it
may be a political gamble, with putting Ryan on the ticket is that, should
he win, he`s going to have to address Medicare if he`s president of the
United States, so might as well really be upright and up front about what
his views so he can have a mandate should he win.

MATTHEWS: Well, let me go back -- that`s fair enough. He will get a
mandate if he wins on this issue.

(LAUGHTER)

MATTHEWS: But, Gene, back to this question.

ROBINSON: Sure.

MATTHEWS: Suppose you`re a woman in this country watching this show
right now in our demographic, someone in your 40s to 60s or whatever, and
you have got an aging parent.

And now you`re thinking I have got to take my mother, I have got to go
find an insurance company after she`s had some medical problems. Who
doesn`t in the ages of 70s and 80s. And I have got to go to find her an
insurance policy that can be paid for by Paul Ryan`s voucher. It just
seems like you`re just messing with people here.

Your thoughts.

ROBINSON: Well, I think it`s not just that. It`s not just people who
are thinking about their elderly parents or their elderly parents
themselves, but people 40 to 60 who may well believe Ryan that, gee, you`re
not going to be affected right now, we wouldn`t voucherize the elderly now,
but if you`re 40 to 60, you would be, or most of those people would be
voucherized at some point under Ryan`s plan.

And they know they`re familiar with the sorts of infirmities that
elderly people have and familiar with private insurance markets. So, look,
I don`t think there is not a mandate in the country for making Medicare
into a voucher program. There just is not and I don`t think there`s going
to be.

MATTHEWS: It does seem there`s an age issue here, Robert.

But, first of all, let`s look at the states we`re looking at tonight,
the three states Obama keeps his lead in over Romney, though the race
remains close, of course. In Ohio, the president`s up over Romney 50-44.
Now, that`s pretty healthy, given the times we`re in. In Florida, the
president has a three-point lead. Not much there, 49-46. Wisconsin is the
closest of the three. The president`s only up by two 49-47.

I think that may have something to do if that poll is recent enough
with the selection of Mr. Ryan, who`s the home state guy from Wisconsin.

But my question is, are these big enough? Does the president benefit
enough from -- or has the Republican candidates, by pushing this issue,
eroded somewhat the natural Democratic advantage on Medicare?

COSTA: Look, it`s a nice balance for President Obama, but if I was
the president, I wouldn`t be too confident, especially like in about a
state like Wisconsin.

I have spoken to Paul Ryan about this many times. He comes out of a
purple district, a real swing district in southern Wisconsin, Janesville,
Wisconsin. And it`s a swing district. But he keeps winning there with
large margins. Ryan always tells me and he tells the conservatives on the
right that unless you address this head on, the Democrats will be able to
define the entire debate.

That`s how Ryan has really changed the entire party. Romney couldn`t
avoid this issue. If Romney was avoiding it, he would be getting heat
right now from the right for not talking enough about Medicare and about
the reforms that need to happen.

MATTHEWS: OK. I can`t wait for the debate between Joe Biden and this
guy Paul Ryan, because there`s a real generational -- Gene and I know.
There`s a generational piece here. And Biden`s going to be very good on
the constituent service aspect of this.

He will tell you case after case after case of people in Delaware he`s
helped with Medicare issues, and the other guy will be a little bit little
colder on that one, I think. He won`t be quite as winsome when it comes to
the reality of people in their own lives.

(CROSSTALK)

COSTA: What about that image of Paul Ryan in Florida with the 78-
year-old mother who`s on Medicare? You`re going to see that at the
convention.

(CROSSTALK)

MATTHEWS: Keep trying, fellow. Keep trying. We will see who wins on
this battle. This is home turf for the Dems.

Thank you, Robert Costa, and thank you, Gene Robinson.

Up next, one of the big themes of next week Republican Convention is,
we built it, as in private enterprise, not the government. But take a
guess who built the arena where the convention for the Republicans is
actually being held? That`s a little factoid that people might be noting.
It`s actually built with government money.

Well, this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Back to HARDBALL.

Will the Republican Convention fall victim to bad timing on more than
one count?

Here`s David Letterman on the Todd Akin situation a wannabe hurricane
named Isaac.

(BEGIN VIDEO CLIP, "LATE SHOW WITH DAVID LETTERMAN")

UNIDENTIFIED ACTOR: A potential hurricane is heading for Florida.
Forecasters warn it could disrupt the Republican Convention in Tampa.
However, there`s no cause for alarm. According to Todd Akin, Florida
rarely suffers damage from a legitimate hurricane.

(LAUGHTER)

UNIDENTIFIED ACTOR: Representative Todd Akin. Science is fun.

DAVID LETTERMAN, HOST, "LATE SHOW WITH DAVID LETTERMAN": It`s time
for a very popular segment on the program. It`s time for nobody cares.
Oh.

(LAUGHTER)

REP. TODD AKIN (R), MISSOURI: Well, first of all, let me say --

On screen: "Nobody cares."

(LAUGHTER)

(END VIDEO CLIP)

MATTHEWS: Well, he`s not only -- he`s actually -- David only taking
note of one of Akin`s situations, but he was also the congressman from
Wisconsin -- actually, he`s head of the -- he`s on the House Science and
Technology Committee.

At a fund-raiser in New York last night, the president noted that. He
said -- quote -- listen to this -- "The interesting thing here is that this
individual, Todd Akin, is on the House Science and Technology Committee,
but somehow missed science class."

Another note on the Republican Convention, remember President Obama
pointing out that business owners depend on public projects like roads?
And Republicans twisted that remark of course to make it sound as if the
entrepreneurs themselves didn`t deserve credit for their success.

Well, the theme of the second night of the RNC will be, we built this.
Get it? We built our businesses, not the oppressive government. But hang
on. The building where the convention is being held, The Tampa Bay Times
Forum, they`re you`re looking at it, was built in large part thanks to
government funding.

The 1996 project had a budget of $139 million, 62 percent of which, or
$86 million, came from public money, more than half. So, Republicans,
remember where you are.

Next, what could cause a Republican judge in Texas to call for a tax
increase? Bring on county Judge Tom Head and his concern that if President
Obama is reelected, it could start a civil war and that could cost money
for him. Let`s watch.

(BEGIN VIDEO CLIP)

TOM HEAD, TEXAS COUNTY JUDGE: He is going to try to hand over the
sovereignty of the United States to the U.N.

OK. What`s going to happen when that happens? I`m thinking worst-
case scenario.

UNIDENTIFIED MALE: Right. Right. I understand.

HEAD: Civil unrest, civil disobedience, civil war, maybe. And we`re
not talking just a few riots here and demonstrations. We`re talking --
we`re talking Lexington, Concord, take up arms and get rid of the guy, OK?

I don`t want a bunch of rookies back there.

UNIDENTIFIED MALE: True.

HEAD: I want trained, equipped, seasoned veteran officers to back me.

(END VIDEO CLIP)

MATTHEWS: What a case.

Anyway, the president giving up the country to the United Nations?
Judge Head used that birdbrain scenario to justify a potential tax hike
locally needed to beef up military personnel. How would you like to have
this character in court passing judgment on you? Judge Head, remember that
name.

Finally, in addition to the Romney campaign, who else might be less
than pleased with this anti-Romney ad starring Romney Girl?

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Hi, Romney.

UNIDENTIFIED MALE: Hi, Miss.

UNIDENTIFIED FEMALE: Do you have something to hide?

UNIDENTIFIED MALE: Well, yes. Jump in.

UNIDENTIFIED FEMALE (singing): I`m a Romney girl in a Romney world.
Life is taxless. It`s fantastic. Silver-tip your hair, tax shelters
everywhere. Outsource nation, Bain is his creation.

UNIDENTIFIED MALE (singing): I`m Mitt Romney. Let`s go party.

UNIDENTIFIED FEMALE (singing): He`s a boss millionaire with accounts
everywhere, won`t disclose all the dough that he`s banking.

(END VIDEO CLIP)

MATTHEWS: She looks like the girl in the St. Pauli beer commercial.

Anyway, easy to see why Mitt Romney wouldn`t be a fan, but how about
the Swiss government, whose Department for Foreign Affairs released a
statement saying that the video promotes the idea that the only reason to
have a Swiss bank account is to hide money from the tax authorities? What
a horrible assumption that is.

Anyway, up next, a group of Navy SEALs is now coming to President
Obama`s defense against those charges that the president tried to grab all
the credit for that raid that got bin Laden. That`s ahead here on
HARDBALL.

You`re watching it, the place for politics.

(COMMERCIAL BREAK)

SUE HERERA, CNBC CORRESPONDENT: I`m Sue Herera with your CNBC "Market
Wrap."

Stocks closed near session lows as word came that the Federal Reserve
may not be poised to enact new stimulus measures after all. The Dow slid
about 115 points on the trading session, the S&P down 11 and the Nasdaq was
down 20 points.

Tech stocks led the losing streak, with Hewlett-Packard tumbling after
reporting its biggest quarterly loss in that company`s history.

And a sliver of good news for Facebook, which got the go-ahead to
acquire Instagram. Also, an improved Facebook iPhone app on the way.

That`s it from CNBC. We are first in business worldwide -- and now
back to HARDBALL and Chris.

MATTHEWS: Welcome back to HARDBALL.

As we reported last week, a group of former special operations forces
and CIA officers, many with ties to the Republican Party, the Tea Party
groups and the birthers, have launched an attack on President Obama over
his handling of the bin Laden raid last year. They accused the president
of leaking information about the operation and taking too much credit for
its success.

Here`s part of a 20-minute video they put online.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They didn`t -- this administration didn`t capture
or kill or eliminate bin Laden or anybody else. There`s a whole lot of
folks in the military and intelligence community who have been working on
this for a very long time.

BEN SMITH, FORMER NAVY SEAL: Mr. President, you did not kill Osama
bin Laden. America did. The work that the American military has done
killed Osama bin Laden. You did not.

(END VIDEO CLIP)

MATTHEWS: Wow.

Well, this week, the group came under strong criticism from fellow
special forces and other military leaders.

As the Associated Press reported, some officers say the group is
breaking a sacred military creed, respect for the commander in chief. The
Associated Press quotes one Green Beret who wrote on his Facebook page --
quote -- "This is an unprofessional, shameful action on the part of the
operators that appear in the video, period."

And on Tuesday, the top U.S. general, the head of the Joint Chiefs of
Staff, Marty Dempsey, Martin Dempsey, weighed in with his criticism. Let`s
listen.

(BEGIN VIDEO CLIP)

GEN. MARTIN DEMPSEY, JOINT CHIEFS OF STAFF CHAIRMAN: The American
people don`t want us to be another special interest group. But if someone
uses the uniform, whatever uniform it is, for partisan politics, I`m
disappointed by that, because I think it does erode that bond of trust we
have with the American people.

(END VIDEO CLIP)

MATTHEWS: So, did this group cross a line? I think so. But will
their message find a receptive audience on the right?

Michael Hastings is a political reporter for BuzzFeed and a
contributing editor at "Rolling Stone." Spencer Ackerman is a senior
writer for "Wired" magazine`s Danger Room blog.

I`m going to start with Martin on this -- or actually Spencer.

Spencer, let me ask you about this -- this group. It seemed to be
marbled in here with people of the birther persuasion, the real zanos who
are incredibly, well, I think, nuts, but they believe in some conspiracy
theory that Mrs. Obama, the mother of President Obama, somehow conjured up
this notion her president -- her husband -- somehow, she came up with the
idea her son should be president some day, so she managed to marry a guy
from Africa with the name Obama, Hussein Obama, and then she -- Barack
Hussein Obama -- and then she figured out, well, I will have the baby over
in Africa, and then I lie about it and put out newspaper accounts that he
was really born -- what an insane way to have your brain work, to think
that somebody would ever think like that or whatever pull it off.

And for what purpose? If you want your son to be president, you
probably will marry a guy Joe Martin from across the street who has got an
Ivy League education and everything is figured out ahead of time. It`s
insane.

But, anyway, move on here.

This guy Ben Smith really gets to me. Tell me about these guys.

SPENCER ACKERMAN, WIRED.COM: This is an organization that really kind
of gets laughed at when I have had conversations with people in the
military and the Pentagon around it.

Not a lot of people consider it credible. And they view it with a
kind of embarrassment, that it`s one thing to make a critique about leaks.
It`s quite another thing to inject yourself into the middle of a political
campaign and sort of get the uniform involved in it.

(CROSSTALK)

MATTHEWS: Are they using their uniform? Does this have nothing to do
with their military role, it has more to do with their ideology on the hard
right?

ACKERMAN: It`s hard to understand how this organization would get any
traction if they weren`t using their military experience as a cover to make
this sort of strange critique of Obama.

I mean, this is a president who`s prosecuted more leakers than any
other previous one, to the consternation -- to the consternation of civil
libertarian organizations.

MATTHEWS: Well, "Foreign Policy" magazine reports that one of the
main spokesmen in this group, Ben Smith, has put this out on his blog: "You
are an impostor. You are a Muslim. You are the Manchurian president and
may you go back to the country you were born in when you are deposed, you
little, little man, and take all your communist sympathizers with you."

Michael Hastings, that is the thinking behind that guy Smith who
appeared in the ad we just showed.

MICHAEL HASTINGS, "ROLLING STONE": Right. I think -- hey, Chris, and
hey, Spencer.

Thanks for having me.

You know, one of the things we have to sort of look at here is, this
has been a well-coordinated campaign that started earlier this year. This
new group led by the birther is the third political -- the third super PAC
that has come out to attack Obama over the bin Laden raid and over national
security leaks.

It seems to be well-funded. There have been allegations from
Democratic groups that Karl Rove is the one behind it and we`re going to
see even more of it. Next week at the Republican convention, they`re
having a event where they`re going to have former Navy SEALs and Special
Forces guys, even U.S. senators, I was told today, up on stage talking
about this.

MATTHEWS: What`s Rove`s involvement? And what evidence do you have of
that involvement?

HASTINGS: Well, the evidence is circumstantial. Rove has tweeted in
support of the group. And he`s also featured prominently on one of the web
pages for Special Operations for America, which is one of the three super
PACs involved here.

MATTHEWS: OK, we`ll see about that as we develop this story.

The video does some selective editing, however, of the president`s
speech to make it seem like he personally took all the credit for the raid
that got Osama bin Laden. They and never thanked the intelligence and
military teams. In reality, of course, we all know the president`s rarely
given a speech about the raid where he hasn`t credited those who did the
work in that case and took the risk.

Here are a few examples that might have been overlooked in the
editing by the people behind this video. Let`s watch what he really said.

(BEGIN VIDEO CLIPS)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Over the last 10
years, thanks to the tireless and heroic work of our military and
counterterrorism professionals, we`ve made great strides in that effort.

Thanks to the incredible skill and courage of countless individuals,
intelligence, military over many years, the terrorist leader who struck our
nation on 9/11 will never threaten America again.

Because of the sacrifices now of a decade and a new greatest
generation -- slowly and systematically, we have been able to decimate the
ranks of al Qaeda. And a year ago, we were able to finally bring Osama bin
Laden to justice.

(END VIDEO CLIPS)

MATTHEWS: Let me go back to Michael here -- you know, even in casual
conversation with somebody high up with the NSC (ph), you get a very strong
impression from them that they know darn well that this wasn`t a partisan
operation to go get bin Laden, that best people to have working with, the
team they work with are totally nonpartisan. These people that work in the
NSC, for example, they themselves (INAUDIBLE) the president, the people who
work in our intelligence services, they aren`t Democrats or liberals or
whatever. It`s a mixed bag of Americans who are doing their duty and
they`re incredibly good at it.

HASTINGS: Right. And I think -- you know, what we`re seeing here
politically obviously is the president`s opponents taking one of his
greatest strengths and accomplishments, was the bin Laden raid and that`s
how it`s perceived, and trying turn it into weakness. That`s classic Rove,
and it`s not an accident that right now, the Obama campaign is fighting
back against this really hard.

They`ve been silent. The White House has sort of been silent on
this, but now, they`re backing and punching back and saying, hey, you know,
making the points you said. You know, the military should not be involved
in these sort of partisan activities.

MATTHEWS: You know, I really think the whole swift boating of John
Kerry was sleazy. This is in the same league. There`s some really bad
about people that engage in this. Let people do what they do for their
country and move on.

Anyway, thank you, Spencer Ackerman. And thank you, Michael
Hastings.

Up next, dirty, angry money -- and now, we`re learning a lot of it is
anonymous. So, it`s dirty, angry and secret. It`s subsidized by you, the
taxpayer, because these groups are getting tax breaks. We`re going find
more about this bad money in politics when we come back.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: In a brand new TV ad set to run in eight swing states,
former President Bill Clinton takes to the camera to argue for a second
Obama term.

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER U.S. PRESIDENT: This election to me is about
which candidate is more likely to return us to full employment. This is a
clear choice. The Republican plan is to cut more taxes on upper income
people and go back to deregulation. That`s what got us in trouble in the
first place.

President Obama has a plan to rebuild America from the ground up --
investing in innovation, education and job training. It only works if
there is a strong middle class. That`s what happened when I was president.
We need to keep going with his plan.

(END VIDEO CLIP)

MATTHEWS: If I were Obama, I`d marry that guy.

Anyway, Big Bill trying to bring home those middle class voters
President Obama knows he needs in order to win re-election.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL.

And as you just saw, we call our segments on money and politics,
"dirty, angry money." Now, there`s a new twist, "dirty, angry, anonymous
and taxpayer subsidized money."

Well, the first two words might be subjective on our part, but a new
report by investigative Web site "ProPublica" proves the second two are
true as well. The report found that 2010 election cycle, groups called
501c4s or social welfare non-profits do little or nothing to justify those
subsidies they receive from taxpayers. Instead, they are pouring much of
their resources directly or indirectly into political races. And that
means you, the taxpayer, are picking up the tab.

And donors to these groups, the majority of this so far in 2012
support Republican causes, get to stay anonymous.

Well, to demonstrate how powerful these groups can be, here`s an ad
from one that helped take down a 14-term well-respected Democratic
congressman.

(BEGIN VIDEO CLIP)

NARRATOR: It`s the worst economy in decades. And the folks in
Washington are living it up, spending our tax dollars like there`s no
tomorrow. Leading this big song and dance, Obama, of course, and Nancy
Pelosi. But there`s one face you might not expect to see. Our old friend,
John Spratt. As Budget Committee chairman, Spratt approved billions in
deficit spending without messing a beat.

Let`s pull the plug on this song and dance once and for all. Join
Mick Mulvane`s fight against the big spenders in Washington.

(END VIDEO CLIP)

MATTHEWS: Anyway, "ProPublica" found that the Commission on Hope,
Growth and Opportunity, a nonprofit social welfare group paid for this ad
and a series of others at an estimated cost of $2.3 million.

But the group reported no spending to the FEC, the Federal Election
Commission. On its tax return said it spent nothing, zero, to influence
elections.

Well, former Congressman John Spratt might disagree. He lost the
election.

Kim Barker is a reporter from "ProPublica" who uncovered the story.
Richard Wolffe is, of course, an MSNBC political analyst.

Kim, great reporting here, but my big question is, how did this
group, this so-called nonpolitical group, get to spend all this money,
defeat a good congressman named John Spratt in South Carolina. And here we
are two years later and the IRS hasn`t caught up with them?

KIM BARKER, PROPUBLICA: That`s a really good question. And I think
that`s actually a question that should be asked to the IRS. I`m hardly the
first person to talk about this group. We looked at more than 100 groups
that have spent money on politics, some of which are very valid C4 group
that have been around for a long time.

But this was one of the examples you looked at, you thought, why is
nothing happening? If nothing happens to this group, what is the point of
having rules?

MATTHEWS: Why are they nonprofit? Why are they treated as nonprofit
by the IRS?

BARKER: Right, they said they are. They applied to the IRS, and
they said, we want to be a social welfare nonprofit, we`re going to do
things to help the American public. We`re going to publish -- I think they
called it ecocometric studies and economic studies from valid economists.
And we`re going to take those to the American public and to congressmen and
we`re going to change policy.

And that`s what they said in order to get their application for
recognition by the IRS approved. The IRS approved them within weeks. And,
of course, they told the IRS they were going to spend nothing on politics.
Soon after getting that approval --

MATTHEWS: Well, why would Karl Rove ever be trusted by an IRS agent
to do something nonpolitical with his money? Let`s go to Richard Wolffe on
this.

This is what I find squirrelly about this. We all grew up knowing
there was a 4013c, that`s a nonprofit. But there`s a 401c4 or something
like it I guess where you can`t get a tax break for giving to it, but they
get to operate as a nonprofit. And yet, you have people like Crossroads
GPS run by Rove that can keep its contributors, its donors to this right
wing caused anonymous.

RICHARD WOLFFE, MSNBC POLITICAL ANALYST: Remember, these are
supposed to be public welfare, public education groups. And, you know,
let`s face it, Kim`s reporting and "ProPublica`s" reporting is more -- fits
the definition of public welfare here. They have done us a public service
and shining another light on how this system is abused.

But it`s quite clear the IRS does not have the resources to go after
this. And remember, we are in a political situation where Congress --
let`s face it, members of the Republican Party -- are wanting to defund
operations where the IRS was even involved in health care reform. So how
political would you have to be as an administration to say, we`re going to
beef up IRS policing or enforcement of a tax code which has been abused by
political groups.

It is itself politically controversial. It`s clearly an abuse of the
IRS.

MATTHEWS: Are there any liberal groups using this tax dodge? Kim?

BARKER: Yes, most definitely. We took a look at the 2010 election,
because that was the only election you could get the tax returns for, and
compare the tax returns in their applications with what they told the
Federal Election Commission. And we did find liberal groups and
progressive groups doing this, not to the same extent that conservative
groups did it -- conservative groups did it, though.

MATTHEWS: Well, they`ve been out there doing this kind of trash talk
about people like -- incumbents like John Spratt -- they`ve gone out there
into the ditch politically and destroyed Republicans on the other side.
Have they done this kind of dirty business?

BARKER: I mean, the same kind of ads. Not as creative, but they`ve
definitely done ads that are against Republicans, and you don`t have any
idea where their money is coming from, definitely.

MATTHEWS: You know, let me go back to Richard. I think one of the
old conservative arguments, and you hear from people I respect like George
Will. Let`s get rid of all this policing of who gets to give money, make
sure everything is online, immediately online, with the modern technology
we have, you just have it listed on a Web site, immediately how much money
you`re getting from different people, so at least there`s transparency.

Here you see the right wing and I guess some on the left exploiting
the opportunity not to be transparent.

WOLFFE: Right. And let`s face it, Republicans are better at it this
time around, there`s more money slushing around the system. But if you
cannot deal with the free speech part of this, at least can we clean up the
tax codes so that people are not pretending to be some how public welfare
organizations when they`re not?

MATTHEWS: Yes.

WOLFFE: Can we at least have honesty in this, and, yes, openness and
transparency, that`s a bare minimum.

MATTHEWS: I think with the modern technology we have, where you can
punch up something on a BlackBerry, you can see who`s giving money to
someone and decide if you like them or not.

Kim Barker, great reporting. Thank you. And I think have you broken
ground here.

BARKER: Thanks.

MATTHEWS: Thank you, Richard Wolffe, as always, sir.

WOLFFE: Thank you, Chris.

MATTHEWS: When we return, let me finish tonight with Mitt Romney.
He`s so deep in bed with the right wing of his party now, he cannot crawl
back or sneak back to the center for anybody.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Let me finish tonight with the wayward shift of the
rightward party. I thought for a while that if President Obama were to
lose this election, it would be because voters believe both candidates, he
and Mr. Romney, were both to the left of where they say they are. Obama
would successfully be accused of being intent on a far larger government
role than he`s supported. Romney being able to sell himself as a candidate
far more moderate, far more to the left of the commitments he made in the
primaries and since.

Well, now, given the events of the last week, I think that scenario
is highly unlikely, it`s increasingly obvious that Mr. Romney, whatever
stance he took as governor in Massachusetts, has married the right wing of
his party -- the neo-cons, the no taxes, the religious right, the
hardliners against abortion rights. He`s not, nor can he be confused with
the guy who pushed health care up in Massachusetts, who once called himself
stronger on gay rights than Ted Kennedy. That memory is as faded as the
old newspapers of that era. If any remain anywhere, except in Romney`s
scrapbook.

Now, I think the rise of Todd Akin, the picking of Paul Ryan, the
emergence of Ryan`s hard-line position on abortion -- the whole menu of it
means that Romney has set the table for himself. He`s made too many deals
with the right that he cannot disentangle himself from. He`s one of the
people now he`s gotten in bed with. And that, ladies and gentlemen, is a
fact.

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

"POLITICS NATION" with Al Sharpton starts right now.

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

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