'Hardball with Chris Matthews' for Monday, July 8th, 2013

HARDBALL
July 8, 2013
Guests: Alex Ferrer, Mirna White, Eliot Spitzer, Joel Rubin, Arthur Wolk

MICHAEL SMERCONISH, GUEST HOST: Who was crying for help, Trayvon Martin or
George Zimmerman?

Let`s play some HARDBALL.

Good evening. I`m Michael Smerconish, in for Chris Matthews.

Leading off tonight, day 20 of the Trayvon Martin murder trial. It`s the
first full day for George Zimmerman`s defense team, which say they could
rest their case as early as Wednesday. Zimmerman is pleading not guilty to
second degree murder charges, citing self-defense.

Well, today the defense team called witness after witness, including
Trayvon`s father, Tracy Martin, in an attempt to counter last week`s
dramatic testimony from Trayvon`s mother, Sybrina Fulton. She told the
court it was absolutely her son`s voice yelling for help in the background
of a neighbor`s 911 call. But Mr. Martin previously said that it wasn`t
his son`s voice.

It was key testimony at the heart of the issue of whether or not Zimmerman
acted, as he claims, in self-defense. Since the prosecution rested its
case on Friday, the defense has already called about a dozen witnesses,
including Zimmerman`s mother, who said late Friday that it was her son`s
voice on that tape and not Trayvon`s.

Some 10 witnesses took the stand today, and more are on the way. Let`s get
to MSNBC`s Craig Melvin for the latest from the Florida courthouse --
Craig.

CRAIG MELVIN, NBC CORRESPONDENT: Michael, in the past few minutes,
something major has happened here. A short time ago -- in fact, just a few
moments ago -- Judge Nelson has decided to allow the toxicology report in.
We expect that the state will offer a witness -- a witness tomorrow to
speak to the toxicology report.

Just to give you some background here, Dr. Bao, Shiping Bao, on Friday, if
you recall, testified that at some point, he changed his mind not about
whether there was actually marijuana in his Trayvon Martin`s system, but
whether that marijuana would have an effect on Trayvon Martin. That
happened on Friday.

Again, there -- we do know that there was some marijuana in Martin`s
system. The question that was just raised with -- with Judge Nelson was,
you know, whether the level of marijuana in his system would impair his
behavior, and again, just moments ago, Judge Nelson deciding that she is
going to allow that toxicology report to be admitted into evidence, saying
that if she were not to do that, it would be a reversible -- an
irreversible error. So again, a major development here.

We should note here, obviously, the jury was not in the courtroom for any
of this. There was also another hearing -- or there is another hearing
under way right now, and this hearing is related to an animation that the
defense hopes to use. The state is objecting to the use of this animation.
This is an animation that would show -- show how this confrontation went
down.

The state said there are a number of problems with the animation, but among
them that it artificially depicts lighting conditions, lighting conditions
there in that condo complex. And it`s also, quote, "based completely on
approximations made by -- made by various witnesses." Some of those
approximations were turned around or changed once those witnesses took the
stand.

So again, jury not in the courtroom, but to -- one semi-important hearing,
but with regards to the toxicology report, again, a very important hearing
because Judge Nelson earlier ruled that the toxicology report would not be
admitted, would not be allowed into opening statements, but left the door
open to the fact that it could be reviewed later on in the case. That
review just happened, and again, that will happen tomorrow.

You mentioned Tracy Martin, Tracy Martin, obviously, being the biggest
witness of day. He was solemn, he was collected as he testified that his
son, Trayvon Martin, was his best friend. He also said that he could --
with regards to whether it was his son`s voice on the 911 call -- so much
has been made over whether Tracy Martin said "No," whether -- when he
changed his mind.

Today on the stand, Tracy Martin said he told police that he couldn`t tell.
He didn`t say that he said, "No," he said, "I couldn`t tell." So again,
that was Tracy Martin called, of course -- called by the defense, not
called by the state, Michael.

SMERCONISH: Craig, thanks for a great report. We appreciate it.

MELVIN: Thank you.

SMERCONISH: For more on the trial, we`re joined by MSNBC legal analyst
Lisa Bloom, Alex Ferrer, who`s a former Florida circuit court judge, and
Mirna White, who`s a former (sic) criminal defense attorney.

I want to get in a moment to what went on with Trayvon Martin`s father and
his testimony, but let`s -- let`s deal with the toxicology that we just
heard from Craig. Lisa, I presume that this will be billed as a victory
for the prosecution (sic) because now that evidence comes in. Wouldn`t pot
more instinctively make somebody seem more docile?

*LISA BLOOM, MSNBC LEGAL ANALYST:* Right!

SMERCONISH: I mean, intuitively, I say that makes Trayvon Martin less the
aggressor.

*BLOOM:* That`s right. The defense has been the one fighting to get this
in. And especially after the medical examiner changed his testimony last
Friday, it opened the door and they got to argue again. But isn`t most
people`s common experience with marijuana that it makes you less
aggressive, more relaxed? So I don`t know, ultimately, if this is really
going to help the defense at all.

SMERCONISH: Alex, are they misreading it? Is the defense misreading this
by wanting to get that into evidence?

ALEX FERRER, FMR. FLORIDA CIRCUIT COURT JUDGE: I don`t think they`re going
to get it in for the purpose of arguing that he got high, so he became
violent, because I think that it kind of strains all credibility.

However, in the opening statement and throughout the case, we`ve heard the
tape being played of the call to the police, where George Zimmerman says,
There`s a strange guy, he`s walking between the houses, he looks like he`s
high on drugs or something.

And this tends to corroborate that he wasn`t just making stuff up because
he was watching a black male. He was actually reporting something that, lo
and behold, he does seem to be high on something. In fact, they did argue
that in the video from the 7-Eleven or whatever, he seemed to be swaying a
little bit, which is consistent again.

SMERCONISH: Mirna, isn`t there a risk, though, for the defense that there
could be blowback if this is viewed as nothing but an effort to sully the
man who`s no longer here?

MIRNA WHITE, CRIMINAL DEFENSE ATTORNEY: Absolutely because the amount of
marijuana in his system, we don`t know how much was in the system, as it
is, and was that enough in his system to make him act out? And I can agree
with Lisa. Generally, when people are taking marijuana, it is a docile,
more mellow type of feel, not of aggressor or aggression.

*BLOOM:* And these are trace amounts, I want to emphasize.

FERRER: Very small. Very small.

SMERCONISH: Well, there were other big developments today. Trayvon
Martin`s father, Tracy Martin, was called to the stand and delivered a
stunning piece of testimony. Prior to Martin taking the stand, we heard
from two detectives who said that they heard Martin say that it wasn`t his
son`s voice screaming for help in the background of a neighbor`s 911 call.
Their testimony echoed a police report, which said, quote, "I asked Mr.
Martin if the voice calling for help was that of his son. Mr. Martin,
clearly emotionally impacted by the recording, quietly responded, No."

Here`s the exchange when defense attorney Mark O`Mara asked Tracy Martin
about that.

(BEGIN VIDEO CLIP)

MARK O`MARA, GEORGE ZIMMERMAN`S DEFENSE ATTORNEY: Do you recall Officer
Serino asking you whether or not you could identify your son`s voice?

TRACY MARTIN, TRAYVON MARTIN`S FATHER: Not those exact words, but
something to that nature, yes.

O`MARA: OK. Do you recall the words, as best as you can recall, that he
used?

MARTIN: As best as I recall, after he played the tape, he basically just
said, Do you recognize the voice?

O`MARA: And what was your response?

MARTIN: My response was that -- I didn`t tell him that I didn`t know -- I
didn`t tell him, No, that wasn`t Trayvon. I kind of -- I think the chairs
had wheels on them, and I kind of pushed away from the -- away from the
table and just kind of shook my head and said, I can`t tell.

O`MARA: So your words were, "I can`t tell"?

MARTIN: Something to that effect. But I never said, No, that wasn`t my
son`s voice.

(END VIDEO CLIP)

SMERCONISH: I thought the attempt, Lisa, at rehabilitation by the
prosecution was pretty effective, when essentially, they brought out of the
man that he didn`t want to accept, given the rawness of the emotions in the
immediate aftermath -- didn`t want to accept at that juncture that his son
had passed.

*BLOOM:* This was totally unnecessary, for the defense to put Tracy Martin
on the stand. They already had two police officers saying that he denied
it. This was not necessary at all. I think this is the second biggest
blunder the defense has made, only after putting George Zimmerman on
"Hannity," where he said that the killing of Trayvon Martin was God`s plan.

SMERCONISH: Does it, Mirna, all come down to a jury`s determination of who
they believe that voice is? Whomever the voice is was not the aggressor,
consequently, it could sway the entire outcome of the case? Or is that too
dramatic?

WHITE: I think it`s too dramatic. I think it`s a number of issues, you
know, in the jury`s determination of who the aggressor was. They have
witnesses that said, We saw the lighter man on the bottom, and another
witness said that we saw the lighter man -- I mean, the darker man on the
top.

So I think it`s not just -- and I think that the defenses is belaboring
that point, and as Lisa says, it`s not necessary. I think it did more good
for the prosecution because it brought out an emotional Tracy Martin.

And you know, after coming to the station, not knowing why he was coming,
not to hear a recording, thinking maybe that he was going to gather his
son`s things, he`s very emotional. You know, he`s distraught. He`s trying
to come to grips with the terms that his son was just murdered.

So I think that they`re really just belaboring that point and that the
jury`s -- that`s not going to be the deciding factor for the jury.

SMERCONISH: Alex, let me call on your experience as a former Florida
judge. Some believe that there was overcharging in this case and that the
prosecution is going to have difficulty in meeting its burden with regard
to a second degree murder charge.

How difficult will it be for the prosecution, if they can`t win second
degree, to nevertheless get a manslaughter conviction?

FERRER: Well, it`s not difficult, really. I mean, the same argument was
made in the Casey Anthony case, and I disagree with it, as well. Some
people say you overcharge and the jury ends up losing confidence in you.
But the reality is, they`re going to be instructed on the lesser. And it
really is easy for a prosecutor to get up there and say, Look, we`ve proven
second degree murder. Look at these elements. But if for some reason, you
don`t agree, we certainly have proven manslaughter.

So I don`t think it hurts them at all. If they did something outrageous,
if they charged something ridiculous that`s not even remotely supported by
the evidence, then they lose total credibility and then it might hurt them.
But this was a close call.

SMERCONISH: The defense`s day was built around testimony from Zimmerman`s
friends and colleagues, who all say it`s his voice screaming for help in
the background of the 911 call.

(BEGIN VIDEO CLIP)

O`MARA: Do you know who`s voice that is in the background, screaming?

UNIDENTIFIED FEMALE: Yes, definitely, it`s Georgie.

UNIDENTIFIED MALE: I thought it was George.

O`MARA: OK. And tell me why you think that.

UNIDENTIFIED MALE: Just the tone, the -- just the volume and the tone of
what I was hearing. And it just sounded like George.

UNIDENTIFIED FEMALE: I recognized his voice. I`ve heard him speak many
times. I have no doubt in my mind that`s his voice.

O`MARA: Whose voice is it?

UNIDENTIFIED FEMALE: George Zimmerman`s voice.

UNIDENTIFIED MALE: There`s absolutely no doubt in my mind that it`s George
Zimmerman. And I wish to God I did not have that ability to understand
that.

(END VIDEO CLIP)

SMERCONISH: Lisa, given the totality of that testimony, is that why you
believe it was unnecessary to call Trayvon Martin`s father to the stand at
the end of the day?

*BLOOM:* No, I think because the two police officers had already said that
Trayvon Martin`s father said, It`s not my son.

You know, I have in my mind Mark O`Mara`s cross-examination of Trayvon
Martin`s mother, where he planted the idea that you have to hope that it`s
your loved one calling out because the alternative is unacceptable. And
that applies, I think, to all of these witnesses, who care very much about
George Zimmerman on one side, or care very much about Trayvon Martin on the
other side.

I`m not saying that they`re lying. I mean, probably, some of them are
right. Some of them have to be right. It`s one or the other. But those
who are wrong are probably hoping in good faith...

(CROSSTALK)

SMERCONISH: ... and isn`t one of the issues, Alex, that none of those
who`ve testified were familiar with both voices. You know, we`ve got
individuals who are familiar with one or familiar with the other, but they
don`t know both.

FERRER: Not only that, more importantly, I don`t think any of them are
familiar with either voice in a panic, scream-for-your-life mode. I think
that they are friends. They want to believe they -- if they`re right,
they`re probably right coincidentally, not because they ever heard their
voice in a screaming-for-your-life mode.

So I really think that the jury could latch onto one or another. It`s not
going to be because of quantity. It`s not because, Well, they presented
seven and you presented two, so we`re going to go with seven. It`s not
going to be that.

But they may just wash them and say, You know what? I don`t think we know
whose voice is on that, but let`s look at the other evidence.

SMERCONISH: You know, I fully recognize it only matters what six women who
are sitting in that courtroom are thinking of this case, but we`re all
paying very close attention. So let me just quickly ask each of you, as it
stands today, how has the case gone in for the prosecution and the defense?
Mirna, you`re first.

WHITE I think for the prosecution -- I think it`s gone in well for the
prosecution. I know many people beg to differ and say that the
prosecution`s case is primarily circumstantial, and you know, there`s no
reasonable doubt. But I think that based on what they have, the
information that they have, I think that they put on the best case that
they could possibly (INAUDIBLE)

SMERCONISH: Alex, do you agree with that?

FERRER: I am one of the people who would beg to differ. I think that the
prosecution`s case is very weak, not because it`s circumstantial -- I have
no problem with circumstantial cases -- but because every witness they
called became a defense witness. They gave more for the defense on some
occasions than the prosecution got.

I don`t believe they`ve proven second degree murder. I don`t know that
they can prove manslaughter because the self-defense evidence that`s in the
record already, without the defense finishing, is very strong.

SMERCONISH: By your analysis, should the defense have even put on a case?

FERRER: Oh, yes, because if he gets convicted of manslaughter, it`s 30
years maximum in state prison. So I think that they are right to put on a
case. In fact, I think the M.E. that`s going to be coming, Vincent DiMaio,
is going to help the defense`s case tremendously as far as the lack of
injuries on the knuckles of Trayvon.

SMERCONISH: Lisa Bloom, where are we, by your eyes?

*BLOOM:* So I have watched almost every minute of this trial, I would say
99 percent of it. I have reviewed all of the evidence, sometimes of it
multiple times. And I didn`t come into this with any preconceived ideas,
gunning for one side or the other.

I thought the prosecution began slowly, and many of the witnesses were
turned for the defense. But I think that they have really picked up steam
and they`ve established a lot of serious inconsistencies in George
Zimmerman`s story.

This is not a case where you can hold up one sound bite and say, See? He`s
guilty. It takes pulling the threads together and a very strong closing
argument.

But I`ve got to tell you, when George Zimmerman said on that "Hannity"
interview, as I said, that it was God`s plan, you know, that really is a
sour note. When you look at the evidence, like the fact that the gun was
holstered inside his waistband, behind him -- the gun is black, the holster
is black. It`s a dark night. And supposedly, Trayvon Martin saw it and
reached for it, which seems almost a physical impossibility to me.

SMERCONISH: But they really haven`t -- you know, you`ve noted that, and I
think it`s a great observation. They really haven`t made note of that in
the trial, at least thus far.

*BLOOM:* Yes. I hope the operative word is "yet."

SMERCONISH: Three great analyses. Thank you so much for being here, Lisa
Bloom, Alex Ferrer and Mirna White.

Coming up: What happened in the final moments of that Asiana flight that
crashed in San Francisco`s airport? It`s rare to hear experts talking
about this so early, but the words on everyone`s lips seem to be "pilot
error."

Also, you can just imagine what Eliot Spitzer was thinking. Hey, if
Anthony Weiner can be a front-runner by running for mayor of New York City,
why can`t I run for something? So he is, for city comptroller. And he
joins us tonight here on HARDBALL.

Plus, dozens were killed in clashes in Egypt today. Our issue tonight, is
the U.S. more interested in preserving democracy or in joining the side
that`s winning?

And "Let Me Finish" tonight with one more reason why people have had it up
to here with government.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

SMERCONISH: The daughter of former vice president Dick Cheney may be about
to trigger a Republican civil war. Liz Cheney wants to run for the Senate
seat in Wyoming currently held by fellow Republican Mike Enzi. But Enzi,
who is 69 years old, says he has no plans to step aside, and many
Republicans in Wyoming say that he`s done nothing to warrant being tossed
out.

In fact, former Wyoming senator Alan Simpson told "The New York Times,"
quote, "It`s a disaster, a divisive, ugly situation, and all it does is
open the door for the Democrats for 20 years."

We`ll be right back.

(COMMERCIAL BREAK)

SMERCONISH: Welcome back to HARDBALL. Saturday`s crash landing of Asiana
Airlines flight 214 in San Francisco left two dead and more than 180
injured, and raised a lot of questions. We just got this video shot from
across San Francisco Bay showing the plane`s chutes deploying and
passengers escaping the flaming aircraft.

Let`s watch.

(COMMERCIAL BREAK)

UNIDENTIFIED MALE: They`re running out, dude. They`re (EXPLETIVE DELETED)
running.

UNIDENTIFIED FEMALE: Oh, my God! What the (EXPLETIVE DELETED) just
happened?

UNIDENTIFIED MALE: I told you, it just -- everybody`s just running.

(END VIDEO CLIP)

SMERCONISH: This afternoon, NTSB chairwoman Deborah Hersman says
investigators plan to interview the pilots tomorrow, and she had this to
say about the current state of the investigation.

(BEGIN VIDEO CLIP)

DEBORAH HERSMAN, NTSB CHAIRWOMAN: They`re now reviewing manuals and
training. They`re working to conduct 72-hour work/rest histories. And
those 72-hour histories are really looking at the pilot`s flight duty time,
their rest opportunities, and the activities that have taken place in the
days leading up to the crash.

In our investigations, we`re often looking for things that might affect
human performance, like fatigue, like illnesses or medication, like health
issues. And so we will be looking at all of those things to see if there
are any impacts on their ability to perform their jobs.

(END VIDEO CLIP)

SMERCONISH: Joining me now, pilot and aviation lawyer Arthur Wolk.
Arthur, thanks for being here. I don`t remember a case like this of such
catastrophic consequences, where on the tip of everybody`s tongue, even if
they`re not saying it, seem to the words "pilot error." At this early
stage, is that your assessment?

ARTHUR WOLK, AIRLINE SAFETY EXPERT: Yes, there`s no question about that.

This airplane made an unstabilized approach to the airport under beautiful
weather conditions. There was no reason for it not to have been
stabilized. And what stabilized means is being at the proper speed, the
proper descent rate, the airplane configured for landing. And this
airplane, for most of that, wasn`t any of those things.

It was at the improper speed. It was slow at some point right before the
crash. It was too fast at other points. It was too high, it was too low.
It was simply unstabilized, and a go-around should have been, in fact, is
mandated to be required to avoid an accident.

SMERCONISH: Put me in that cockpit and in lay terms, tell me on what
equipment if I`m relying, if I`m the captain, that tells me where to land
the aircraft?

WOLK: All right.

The pilot`s looking outside, because this is a visual approach. He`s
looking at the runway, and he can see the touchdown zone of the runway.
That`s the part that we have all seen as passengers or pilots. That`s the
part where all the skid marks are, about 1,100 feet down the runway.

Now, that`s the aiming point. That`s where he wants to touch down. And
he`s got to adjust the airspeed of the aircraft to be at what`s called
Vref. So he`s looking at the airspeed indicator. He`s set in the speed
he`s supposed to be flying, 137 knots, for that weight. And what he`s
doing is looking at his vertical speed and his glide path, so that the
sight picture that he sees is going to put him down in the touchdown zone.

SMERCONISH: So what`s...

(CROSSTALK)

SMERCONISH: I`m sorry. Go ahead.

WOLK: What`s happened in this airplane is he was all over the place. He
was too high on that glide path, that visual glide path, he was too low at
some points, he was too fast initially, and then he got slow.

Now, when the airplane got slow, the first thing that should have happened
is the man in the right seat, the first officer or -- I think he was also a
captain -- should have said, Captain, you`re too slow. And if the captain
didn`t do something to change that condition, meaning applying power, then
the first officer should have done it for him.

That`s called cockpit resource management, and he didn`t do that. So the
airplane got even slower. In fact, it got so slow that the stall warning
horn went on, and then the stick shaker activated. The stick shaker is the
airplane`s yoke shaking back and forth. And it`s the last-ditch effort of
the airplane, saying to the pilot, hey, you got me too slow and we`re going
to crash if you don`t add power or get this airplane speed up. And he
didn`t do that.

SMERCONISH: This morning, NTSB Chairwoman Deborah Hersman said the pilot`s
lack of experience landing this plane at this airport was not out of the
ordinary.

(BEGIN VIDEO CLIP)

DEBORAH HERSMAN, CHAIRWOMAN, NATIONAL TRANSPORTATION SAFETY BOARD: It`s
not unusual for pilots to have a first landing coming into an airport.
They fly all around the world. There are a lot of different destinations.
What you want to do is have a crew that`s proficient in the aircraft and
works together well. That you have good crew pairings, that`s important.

(END VIDEO CLIP)

SMERCONISH: Arthur Wolk, what`s your assessment thus far of the experience
issue?

WOLK: I think 43 hours, which the captain had, is not an unreasonably low
amount of experience for the 777.

Remember, he had over 10,000 hours flying big airplanes, like 747s. That`s
not unusual. What I`m troubled by more than anything else is the lack of
what I will call cockpit resource management. Why didn`t the guy in the
right seat say something sooner? Why didn`t he tell the captain, you`re
too slow? Why didn`t he say, you`re below the glide path? Why didn`t he
say, let`s execute a go-around in time to avoid a crash?

He didn`t. Now, the captain, for whatever reason, maybe he was tired,
maybe he was -- didn`t have enough time in the airplane, at least for his
own comfort level. That`s why you have a very experienced pilot in the
right seat, 3,200 hours in the 777, who is supposed to say and do
something.

SMERCONISH: Is it difficult, sometimes -- final question for Arthur Wolk,
but is it difficult for that person in the second seat to speak up in a
circumstance like this?

WOLK: One would hope not.

Pilots are trained that if the captain, even though you revere him and
respect him, and he may be older and more experienced than you, does
something wrong, first, you tell him, and if he doesn`t change what he`s
doing, then you take over the airplane. That`s the way it goes. That`s
the safety procedures that are taught. And that`s what should have
happened here.

SMERCONISH: Arthur Wolk, thank you for your expertise.

WOLK: Sure.

SMERCONISH: Up next: Mitch McConnell`s off-key attack on his new Senate
opponent.

And just a reminder, you can listen to my radio program every weekday
morning at 9:00 Eastern on SiriusXM`s POTUS Channel 124.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

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

It seems that everybody`s on social media these days, the latest edition,
the TSA. The security agency best known for making you remove your shoes
at the airport has joined Instagram and is publishing photos of the items
they confiscate at terminal checkpoints. The feed showcases a variety of
deadly weapons and explosives, everything from loaded pistols, belt buckle
knives to fireworks, grenades, brass knuckles, and even a vintage derringer
and a bayonet.

The initiative is intended to bring attention to the rise in deadly weapons
that are being smuggled onto airplanes. The TSA reports a 30 percent rise
in the number of guns seized in the first six months of 2013.

Senate Minority Leader Mitch McConnell is also showing off his media chops
with a viral campaign ad ridiculing his new Democratic opponent, Kentucky
Secretary of State Alison Lundergan Grimes. The ad released last week
autotunes Grimes` own words to create this.

(BEGIN VIDEO CLIP)

(MUSIC)

(END VIDEO CLIP)

SMERCONISH: A former consultant for Grimes dismissed the ad was childish
for shadowing what might already be a nasty campaign.

It certainly looks like McConnell is sticking to his Whac-A-Mole strategy.
We will see how it plays out.

Finally, if you were in New York last week, you may have been one of the
16,000 people who caught a special Fourth of July-themed exhibit at the
library. Rare original copies of the Declaration of Independence and the
Bill of Rights were on display together, side by side, for the first time.
A Declaration of Independence draft, handwritten by Thomas Jefferson
himself, was one of a few copies to include a condemnation of slavery,
which was later removed.

And, to boot, the earlier copy of the Bill of Rights actually included 12
amendments. Two did not pass, including a amendment that would have tied
the number of seats in the House to the growing population. Had it passed,
there would be 6,000 members of Congress today, rather than 435. Talk
about too many cooks in the kitchen.

Up next, it`s the year of comeback and the end of the sex scandal. Eliot
Spitzer is running again in New York, and he joins us next.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

JANE WELLS, CNBC CORRESPONDENT: I`m Jane Wells with your CNBC "Market
Wrap."

The Dow jumped 88 points, the S&P 500 up eight and the Nasdaq added five.
Dell shares rose, this after an advisory firm recommended that shareholders
vote in favor of a buyout deal from CEO Michael Dell. He`s offering to buy
the company for $24.4 billion and take it private. And kicking off
earnings season, shares of Alcoa were up after the aluminum producer
narrowly beat earnings expectations with 7-cents-a-share profits in the
second quarter. That`s the profit when you exclude so-called one-time
items.

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

SMERCONISH: Welcome back to HARDBALL.

New York Governor Eliot Spitzer resigned from office in March of 2008
because of his relationship with a prostitute. Today, we learned that
Spitzer is making an attempt for a second political act, announcing that he
will run for New York City comptroller.

This year has seen former political stars sidelined from public life as a
result of their own personal behavior and misjudgments launch campaigns for
redemption and for public office once again. Mark Sanford, the disgraced
former governor of South Carolina, who left the state on taxpayer funds to
travel to Argentina to visit his mistress in 2009, recently won election to
the House. Former Congressman Anthony Weiner left Congress in 2011, after
sexual pictures of him surfaced on Twitter. After two years of
elusiveness, Weiner now finds himself neck in neck, if not leading the race
for mayor of New York City.

Spitzer, like Weiner and Sanford, is gambling that voters will forgive him
and look beyond his previous misconduct five years after leaving public
office.

Former governor and now candidate Eliot Spitzer joins me now.

Governor, does running now mean that resigning was unwarranted?

FMR. GOV. ELIOT SPITZER, D-NEW YORK: No, I think what it means is that --
and I -- when I resigned, I felt very deeply that I had violated the public
trust. I needed to act in accordance with my view that accountability
means something. So I resigned.

There are some people who said, try to hang on, try to stay in office, and
I said, no, I must resign. I should resign. I have spent five years
teaching. I had some TV shows, which have been interesting. I have
written. I have run a family -- our family business. I have a book that`s
coming out next week which is a discussion of many of the market principles
that drove what we did when I was attorney general.

So, five years later, I think I can ask forgiveness. I can say to the
public, look at the entirety of my record as attorney general, as a
prosecutor, as governor. I have erred. I have acknowledged it. I have
sinned. I make no denial of that. I am asking for an opportunity to come
back and serve, which is what I love to do.

SMERCONISH: For how long have you known you would get into this race? And
I ask because my suspicion is, you looked at Anthony Weiner and said, what
the hell. This guy is about to run and be elected mayor of New York City.
Eliot Spitzer can be the comptroller.

SPITZER: No. I see why everybody is presuming that.

Actually, I have only known since about 48 hours ago, when I said to
myself, I actually do want to do this. I have done many things over the
past five years and over the past number of months as well. This past
weekend, I said, do I want to do this? I made a final decision, and I
spoke with my -- the members of my family.

The book I have written is now complete. It`s coming out next week. I
said, this is a moment to seek -- to seek public office.

SMERCONISH: Will we see your wife on the campaign trail?

SPITZER: Yes.

SMERCONISH: She`s in?

SPITZER: Yes.

SMERCONISH: Family`s committed to this?

SPITZER: Yes. Yes.

SMERCONISH: Would a Spitzer victory mark the end of the sex scandal as we
know it? And I`m asking, really, have we become too intrusive into our
elected officials and candidates` private lives?

SPITZER: Look, I`m not sure I`m the right person to ask, because I have a
perspective that is so tailored to what I have been through. And I might
separate those questions.

Have we become too intrusive, have we lost all sense of privacy? Yes. I
think that`s a larger issue that we as a society need to confront, from the
NSA issues to what candidates are subjected to. I think maybe there`s an
important conversation there.

Is it the end of the sex scandal? No. Am I any way condoning what I did?
Absolutely not. And, so, I think those issues move in tandem and have an
interesting relationship. But, certainly, the former is a conversation we
should have.

SMERCONISH: Is compart -- is compartmentalization a part of what goes on?
In other words, too often, do we ascribe to one`s behavior in public life
that which goes on in their private life?

I ask you, mindful of the fact that Governor Schwarzenegger, as far as I
know, never had any ethical improprieties about his tenure as governor.

SPITZER: Right.

SMERCONISH: Yet we know what happened vis-a-vis the maid and so forth.

SPITZER: Right.

SMERCONISH: Maybe we should be looking at that case as instructive of the
fact that there is a big line between how one comports themselves privately
and how one comports themselves publicly.

SPITZER: I think what you`re saying reflects what a significant percentage
of what the public feels. And I say that having spoken to many people
about this, some who say, yes, as you just articulated, private life is
private life.

And as I go into this campaign, I`m saying to people, look, I have
acknowledged my -- my -- the problems in my private life, but now I want to
talk about the public. So, some say, yes, there`s a private dimension here
and a public dimension. Others say -- and I understand their perspective -
- one informs the other. One speaks to the coherence of one`s values and,
therefore, you can`t separate them quite that neatly.

I think, as a society, we`re a bits schizophrenic on this. I think other
nations clearly do have that divide.

SMERCONISH: Do they have the right idea?

SPITZER: Again, I think I`m the worst people to speak to it. I think we
need to have that conversation. Again, I have suffered the consequences,
rightly so, of a public looking at both and...

(CROSSTALK)

SMERCONISH: Well, I always said -- I may as well tell you this face to
face -- I always said on air that your wife should have thrown your clothes
out the window into Central Park...

SPITZER: Right. Right.

SMERCONISH: ... but that shouldn`t have impacted your ability to perform
your function as governor.

SPITZER: Right.

SMERCONISH: If you`re a competent guy -- and I think Eliot Spitzer is a
competent guy -- then...

SPITZER: Right.

SMERCONISH: ... beyond the schadenfreude, what business is it really of
ours?

SPITZER: Well, I like hearing that, but, again, I think I`m not the one in
the right position to embrace it and say, aha, you`re right, and you`re
wrong.

I acknowledge what I did. I have paid a price. At this moment, I`m
saying, five years later, maybe, with the public`s permission, I could come
back.

SMERCONISH: OK. One more question...

SPITZER: Sure.

SMERCONISH: ... among a long list of those that you are just sick and
tired of answering.

SPITZER: Yes. Yes.

SMERCONISH: Should prostitution be illegal?

SPITZER: Again, I`m not the right person.

I think that, no, certain parts -- when I was governor, I was proud of the
fact -- and this is what caused the attention -- that we passed much
tougher human trafficking laws. And I think the problem is that
prostitution is, in fact, integrally related with other parts of criminal
activity that is fundamentally wrong, dangerous, violative in any
dimension.

If people are saying, look, two people consensually having sex and there`s
money, in that -- when you define it that benignly, it seems somewhat like
smoking dope and people say, aha, decriminalize it. But it is integrally
related with other aspects of criminal behavior. So, I`m not sure I`m
ready (ph) to it, yes.

SMERCONISH: Does redemption require that you run for comptroller?

SPITZER: No.

SMERCONISH: You were the governor of this great state, as opposed to
running for mayor or some other office?

SPITZER: No, no --

SMERCONISH: I mean, given your credentials and your pedigrees, it almost
feels this is a spot beneath Spitzer`s record?

SPITZER: No, I love that, the job I`m running for, the comptroller.

SMERCONISH: Why?

SPITZER: Because you have a say in so many fundamental decisions about
control of the pensions, which is important not only for ensuring that they
are there for those who earned them, but corporate governance fails because
shareholder voices are not being heard, institutional shareholders are
passive. If we want corporate governance reform, it will come not by
regulation or prosecution, but by ownership, being heard. Ownership trumps
regulation, as I`ve written in many places.

You have a role as comptroller. You have a role to audit the city, not
just where the papers clips delivered. But are the policies working? What
we`re paying for, are we getting back?

And I`ve been A.G., a governor, huge areas there of opportunity. When I
was A.G., I redefined the office. I want to go that for comptroller.

SMERCONISH: You have thick skin, but you can imagine if you`re successful
and Anthony Weiner is successful, this will be late-night fodder for the
next decade.

SPITZER: I`ve been late-night fodder. It would be -- thank goodness for
the remote button. Yes, change the channel. I`ve got thick skin, as thick
as a rhinoceros. But even so sometimes, an arrow pokes through.

But, look, that`s politics. And don`t -- Harry Truman, can`t take the
heat, get out of the kitchen.

SMERCONISH: So, today, you were out on the campaign trail for the first
day in at least five years.

SPITZER: Yes.

SMERCONISH: How was it? What happened?

SPITZER: Yes, that`s correct. I`ll tell you, it was mayhem. There was
one moment I was down in Union Square gathering (ph) some petition and I
think they call it a donut. I was surrounded by more members of the media
than I have literally ever seen in one place.

It was a circle -- it must have been 150 cameras, reporters. I don`t know
why they`re so interested. You know, there are not many questions I
haven`t answered in the past couple of years. And I didn`t say anything
terribly exciting or new today. Maybe I shouldn`t say that. But there I
was.

SMERCONISH: Are executives on Wall Street today opening their checkbooks
to write checks in opposition to Eliot Spitzer, or have those issues tamed
at all, that hostility still exists?

SPITZER: Well, look, I don`t want to characterize their views, but I`ll
tell you, a direct quotation, opening of the book is a quotation of a
lawyer speaking to me saying, be careful, we have powerful friends. That`s
what he said to me, to discourage me from filing one of the most important
cases we filed.

I can`t tell you on air exactly what I said. It would violate some rules.
We filed the case the next day.

They have powerful friends, they are powerful. They disliked what I said.
There`s still a lot of animus there. I`ve seen it as recently as a couple
of weeks ago, in a bar, when somebody came up to me, senior executive, it
went crazy.

SMERCONISH: Any difficulty you`ll have in obtaining the number of
signatures you need to obtain in such a short period of time. If you just
made this decision, my understanding is you need several thousand, it`s a
city of millions, but finding those who are registered to vote is the not
an easy process, by Thursday.

SPITZER: We`re going to do it. I`m confident. I`m going to struggle.
Just walking the one block over here, a couple people came up, I whipped
out a petition and I got them to sign it. We`re going to do it. It`s
going to be hard, because I don`t have the institutions behind me right
now, but I think we`ll be able to do it.

SMERCONISH: If you should win this position, I know you won`t answer me,
I`m going to ask it anyway. If you should become the comptroller, is Eliot
Spitzer`s real to be the mayor of New York City?

SPITZER: No, I`ll answer that. The answer is no. I mean, the real goal
is to win this office and perform as well as I can. When I ran for A.G., I
said, I want to do that job as well as I can. I want to do this job.
That`s always been my view. I don`t worry about what`s down the road. I
focus on what`s right ahead.

SMERCONISH: I find it difficult to believe, though, that the end of the
career path, as you`ve mapped it out, is to be the comptroller of New York
City.

SPITZER: You know, I`m 54. I have a lot of years left. You know, I don`t
know where things go. As I`ve said, I`ve seen peaks and valleys, peaks are
more fun, you learn more in the valleys. I hope I climb back to a couple
of peaks.

SMERCONISH: OK, thank you, Eliot Spitzer.

SPITZER: Thank you, sir.

SMERCONISH: Up next, does the U.S. want to be on the side of democracy or
on the side that`s winning in Egypt?

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

SMERCONISH: Texas Governor Rick Perry won`t seek re-election next year.
Perry is the longest-serving governor in Texas history, and he told
supporters today that he plans to retire. Now, of course, at 63, Perry
could try again for the presidency, but he`d have some big hurdles. Last
time around, he famously said, "oops", during a debate, in which he
couldn`t remember three federal agencies he wanted to eliminate if elected.

We`ll be right back.

(COMMERCIAL BREAK)

SMERCONISH: It was a bloody day in Egypt after clashes left at least 51
people dead. Islamist supporters of deposed President Mohamed Morsi fought
Egyptian soldiers this morning. And there were fears that violence could
get much worse. The Muslim Brotherhood has called on Egyptians to rise up
against the army.

This leaves the United States in an increasingly ugly and difficult
position. The White House has so far refrained from calling President
Morsy`s ouster a coup. Legally, if the administration did conclude that,
it would mean cutting off more than $1.5 billion in aid to the Egyptian
government.

Today, White House Press Secretary Jay Carney said the administration is
still reviewing whether Morsy`s ouster should be labeled a coup, but he
warned that cutting off aid right away would not be in the best interest of
the United States.

NBC`s "First Read" today noted that we should expect the Obama
administration to make a more hands-on approach to what happens next in
Egypt than it did two and a half years ago when Mubarak was ousted. But
how much influence does the U.S. really have?

Howard Fineman is editorial director of "The Huffington Post" and an MSNBC
political analyst.

Joel Rubin is former Egypt desk officer at the State Department.

Mr. Rubin, you`re the perfect person to ask about this coup question and
the significance of the lack of funding, if all of the sudden it gets cut.
How should this play itself out?

JOEL RUBIN, FORMER STATE DEPT. OFFICER: Well, Michael, right now, there is
still chaos on the streets in Cairo. There is blood on the street, quite
literally. And what we need to make sure is that this powder keg doesn`t
have an unwitting match lit next to it. And we need not to wade into a
situation where cutting aid precipitously right now is that match.

So there is an assessment under way. We have a chance now to engage the
Egyptians across the whole swath of political actors, and really push for
where the revolution went 30 months ago, which is to try to be inclusive
and to try to create a democratic path that`s sustainable, and that the
Egyptians control.

SMERCONISH: Yesterday, John McCain did something that so far few in
Washington seem willing to do, officially at least, and that`s call what
happened in Egypt a coup.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: It was a coup and it was the second time in
two and a half years that we have seen the military step in. It`s a strong
indicator of the lack of American leadership and influence since we urged
the military not to do that. And reluctantly, I believe that we have to
suspend aid until such time as there is a new constitution and a free and
fair election.

(END VIDEO CLIP)

SMERCONISH: Howard Fineman, are we on the side of democracy or not?

HOWARD FINEMAN, THE HUFFINGTON POST: Well, that`s a good question. I
think we are in theory. And perhaps this the long run, we are in fact in
Egypt, if the democratic -- the people who support democracy, truly support
democracy in Egypt can get together to take power peacefully.

But Senator McCain is right. I don`t think there`s any doubt that in real
functional terms, this is a military coup. What`s happening is that
President Obama`s foreign policy in that region, which he enunciated in
2009, in the same city of Cairo is now running up against reality in Cairo,
and his support for democratic ideals as he spoke of them in 2009 are being
tested on the streets right now.

Talking to White House -- one White House official, they`re not going any
farther than they went today for now. Carney, Jay Carney`s statement was
as far as they`re going to go at this point.

SMERCONISH: Joel, I see that some protests there see America as being too
close to the Muslim Brotherhood.

RUBIN: Well, it`s an irony of sorts, Michael, because the United States is
going to be blamed, regardless, frankly, of the situation. And we have to
get used to that. Context matters here. We have to remember that nearly
22 million Egyptians, more than a quarter of their population signed a
petition for Mohamed Morsy to leave power. And the military stepped in.

Now, it`s not to condone what the military did, but they saw an internal
situation devolving quickly, and they made a decision. We don`t have
control over that. And our role in this is to make sure that they are
getting back immediately to what it is they called for the other evening,
which is a democratic process.

Clearly, the Egyptian people are looking for more than what they got over
the past year. And frankly, they`re looking for more than what the
military gave them in the prior year.

SMERCONISH: Gentlemen, I --

RUBIN: And it`s really our responsibility to be engaged.

SMERCONISH: I wish we had more time. Thank you, Howard Fineman, as
always.

Thank you, Joel Rubin.

FINEMAN: Thank you.

SMERCONISH: We`ll be right back after this.

(COMMERCIAL BREAK)

SMERCONISH: Let me finish tonight with this:

This was a busy news weekend, especially for a holiday, much of it tragic:
the horrible airline crash in San Francisco, the violent and unsettled
situation in Egypt, and the shooting of 67 people over the extended weekend
in Chicago alone.

And yet, when I read "The Sunday Washington Post" online, I noted that the
most popular item was a column written by Robert McCartney about the latest
caper of the man who bills himself as the Phantom Planter.

Henry Docter, he`s a 52-year-old green thumbed Good Samaritan who for the
last three decades has been surreptitiously planting flowers on four
continents in an effort to beautify public spaces. He views his work as
performance art.

Never has he encountered a problem, that is, until he planted 1,000 morning
glories, cardinal flowers and cypress vines at a Metro Station in the
nation`s capital. His plan was that they would bloom in 176 otherwise
barren flower boxes in colors of red, white and blue from August to
October.

But Metro wasn`t happy. Docter was threatened with "arrest, fines and
imprisonment" if he dared to weed, water or otherwise tend to his work
alongside the top stretch of the DuPont Circle station.

The stated concern: safety. According to McCartney`s coverage, Metro
worried that Docter could hurt himself if he fell given the steep incline
of where he had planted.

But Docter wasn`t arrested.

Instead, Metro pulled out all the flowers, claiming they did so in
anticipation of repairs to paver blocks. The flower boxes, they now sit
empty.

And where the flowers once were, a healthy debate now grows.

Many are incredulous of Metro`s justification, and angry that the
transportation network, which is habitually broke and lacking resources,
could suddenly move so expeditiously to uproot a good thing.

One blogging supporter of the Phantom Planter advised him, "try bamboo next
time."

But others say not so fast. The Phantom Planter trespassed, they argue,
and put flowers were he had no business gardening.

One, for example, wrote, "He planted one plant that was invasive, one that
dies when it gets cold, and one that needs lots of watering. He planted
them on a very steep slope. Perhaps he meant well, but I don`t blame Metro
for ripping them out. What if someone hurt themselves, trying to water the
lovely things?"

That last part was typical of many comments that in the end, blamed lawyers
for this garden-gate.

But actually, I think most lawyers could have solved this by having Mr.
Docter sign a simple liability waiver so that he could have tended to his
crop.

Flowers are an easy call -- which is why this story gets people mad as hell
at government. But what if it`s not flowers, but some other form of
performance art placed on someone else`s property?

My advice to the Phantom Planter: keep planting. But next time, get
permission.

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.
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