'Hardball with Chris Matthews' for Monday, October 7th, 2013

HARDBALL
October 7, 2013

Guest: Sam Stein, Wayne Slater, Jim Moran, Jim McDermott

CHRIS MATTHEWS, MSNBC HOST: Ted Cruz passes out the Kool-Aid.

Let`s play HARDBALL.

Good evening. I`m Chris Matthews out in San Francisco.

"Let Me Start" tonight with this. I`m out here in San Francisco on my book
tour. I just came from Boston. And let me tell you what you already know.

This country`s paying attention to Washington, and it doesn`t like what
it`s seeing. The polls back that up. Seventy percent of a new "Washington
Post"/ABC poll blame the Republicans in Congress, a solid lead on the 61
percent who blame the Democrats. Nobody`s especially thrilled by the
sight, the dangers, the sabotage that`s inherent in the demands behind all
this.

Speaker Boehner, who gets leaked saying one thing, goes on the record
denying it, now seems intent on denying the obvious, that given the chance,
the House of Representatives would not (sic) have the government back to
work by midnight. The far scarier specter is the default looming ahead
just 10 days from now.

Why are we, the greatest country in the world, the very symbol of self-
government, headed toward disaster? Why do we have so many know-nothings
in the Congress who deny not just mankind`s history or the obvious evidence
of climate change, but the fiscal arithmetic that stares us in the face,
what makes them characters in some ghastly, real-life remake of "The Planet
of the Apes," where the bad guys fear nothing more than science and other
evidence of human progress.

Look, I love democracy. Even more, I love democratic politics. I love it
when the two sides go at it with their ideas and contending philosophies
and try to win the public over. But what do you call this, this dangerous
zig-zagging toward the abyss, with a nervous John Boehner being driven to
fist the cliff, while the zealots of the right wing scream louder and
louder that victory lies in catastrophe, Kool-Aid for everyone, and
defeatists will be shot.

Chuck Todd is NBC`s chief White House correspondent, political director.
Eugene Robinson`s a Pulitzer Prize-winning columnist for "The Washington
Post," and of course, an MSNBC political analyst .

Anyway, last week, both "The New York Times" and "The Washington Post"
reported that House Speaker John Boehner had assured colleagues privately
that he would not let the country default on our debts come October 17th,
just 10 days from now, even if it meant seeking Democratic votes to help
him pass a clean hike of the debt limit. That was his stance then.

But not anymore. Just yesterday, on ABC`s "This Week," Boehner pulled a
stunning 180 on the issue of default. Here he is.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: My goal here is not to
have the United States default on our debt. My goal here is to have a
serious conversation about those things that are driving the deficit and
driving the debt up. And the president`s refusal to sit down and have a
conversation about this is putting our nation at risk of default.

GEORGE STEPHANOPOULOS, ABC NEWS: So are you saying that if he continues to
refuse to negotiate, the country is going to default?

BOEHNER: It`s the path we`re on.

(END VIDEO CLIP)

MATTHEWS: Chuck, what`s this zig-zagging to the cliff all about? Explain
it analytically, what Boehner seems to be doing, saying one thing to the
inside crowd, denying it, then going further in the denial. What`s he up
to? Can you tell?

CHUCK TODD, NBC WHITE HOUSE CORRESPONDENT/POLITICAL DIR.: Well, the really
problem is this was the strategy Boehner wanted to pursue all along. He
didn`t want to tie health care -- he didn`t want to tie all this to the
shutdown. And this is now the box he`s found himself in, where the two of
these issues have merged together. He`s got to -- he`s trying very hard to
suddenly make the debt limit not about health care anymore when it got --
again, it`s all been, to me, mixed together and it`s put him in a bad
negotiating position.

So at this point, it`s hard to figure this out. Chris, what I am just sort
of dumbfounded by is the White House is telegraphing a "get out of jail
free" card for Boehner, or at least a delay here, where nobody -- where
everybody can save face and everybody can claim that they stuck to their
guns.

The president has said he wants the government reopened before he`ll have
negotiations and he wants a clean debt limit raise. Boehner has said he
wants to force negotiations. Well, if Boehner does a clean debt limit
raise and a clean opening of the government, spending bill for, say, two
months, for eight weeks, well, then he can claim that he`s still got that
leverage and the president gets his clean bills that he gets to sign.
Everything`s reopened. And then there`s a forced (ph) conversation for
eight weeks.

It`s sort of one of those classic cases where the solution is obvious.
Everybody can get out of this box that they`ve all put themselves in,
particularly the Republicans, and for some reason, Boehner`s not grabbing
it. And I don`t get it.

MATTHEWS: Do you think it`s -- and this is a hard question for someone
like you to answer, but do you think it`s credible that they`ll spend those
eight weeks, if they get them, this sort of overtime, actually negotiating
some deal that they both could buy?

TODD: You know, I don`t know. But the thing is, is you might as well --
you know, why play with the economy at this point? We`re already messing
around with it with this shutdown. So throw in another eight weeks.

Look, supercommittee didn`t work. You know, I`m skeptical. I don`t think
that the conservative grass roots here that`s driving this will accept
anything -- will accept tax reform that includes new revenue, i.e., some
sort of tax increase because of loopholes being closed, any of those
things.

Any of the potential deals that I think Boehner himself would love to cut
and agree to I don`t think the conservative grass roots will ever accept.
So it`s probably a futile exercise, but you might as well at least try for
eight weeks and see if you can move things along without imperiling the
economy.

MATTHEWS: Let me go back to Gene. Gene, it seems there`s some new lingo
being thrown out here by the Speaker. He talks about having a
"conversation." Now, a conversation is not a hard demand.

EUGENE ROBINSON, "WASHINGTON POST," MSNBC POLITICAL ANALYST: No, a
conversation is easy. And you could argue that they`ve been having a
conversation by proxy through us, basically. And one says one thing and
the other says another thing.

So yes, this is another out. You could construe a telephone conversation
or a sitdown conversation, like the one they had at the White House the
other day, and Boehner can construe that as negotiations and declare
victory.

But he seems to be paralyzed or it seems to be unable to move because of
the box he`s been put in by the far right. And he can break out of that at
some point, but I guess he`s waiting for the right moment.

MATTHEWS: But you don`t believe -- apparently, you don`t believe, I hear,
that he is actually as vulnerable as he pretends to be. All this sweat and
crying may not indicate, you think, that he`s really about to be booted
because there`s no alternative to him. There`s no obvious--

ROBINSON: Exactly.

MATTHEWS: -- alternative to him as the speaker.

ROBINSON: Exactly. Who is the speaker in waiting? Eric Cantor, who would
be next logically in line, is so joined to Boehner on this whole issue--

MATTHEWS: Yes.

ROBINSON: -- or suite of issues at this point that he`s not really an
alternative right now. Plus, why would he want the job at this point? And
then who`ve you got? You don`t have anybody out there who`s a logical
speaker in waiting who would, A, be credible, and B, want the job.

MATTHEWS: Let me go back--

TODD: This is--

MATTHEWS: Let me go back to -- let me go back to Chuck for a second, then
back to you, Howard. (sic) I guess this comes down to what really belief
-- about belief, a very human question. Can you tell reading through this
behavior and all the zig-zagging and all the off-the-record and on-the
record and that back-and-forth -- does John Boehner insist on using his
authority as speaker to set the agenda and to put programs on the floor
that he will not get to the 17th of this month -- in other words, next week
-- before passing some kind of debt ceiling to avoid a default?

TODD: I can`t -- that, I can`t figure out. I assume -- I didn`t think he
would -- I thought he would cave before midnight on September 30th. I
thought that there was a way out for them. They didn`t -- he didn`t take
it.

This is not about -- I think the one thing that we are getting wrong here
is this isn`t about whether Boehner is saving his speakership. This is
about whether the Republican Party -- this fight for the soul of the
Republican Party breaks out into open in such a way that the conservative
grass roots basically catches fire in a way that imperils all of the White
House Republican elites.

It`s not just Boehner losing his speakership. It`s these -- it`s becoming
a disconnect that somehow, the Republican leaders aren`t fighting for what
the Republican grass roots want. And if they at all look like they`re
capitulating to any demand the president is making in any form, it`s like
that guy -- you know, it`s like they`ll light themselves on fire--

MATTHEWS: Yes.

TODD: -- or they`ll light the party on fire. So this is--

MATTHEWS: Then we`re in trouble!

TODD: -- about Boehner trying to protect--

MATTHEWS: Yes.

TODD: -- trying to basically paper over the party`s larger problem that
they`ve got going on here.

MATTHEWS: The is the problem that Israel has had all these years with the
Arab side, Gene. It`s not that there aren`t good people on the Arab side,
it`s that the good people on the Arab side don`t call the shots and they`re
always worried about the terrorists behind them that would break the deal.
You know, there have been -- Mahmoud Abbas, for example, is obviously a
thoroughly going -- reasonable person who wants a state and knows he has to
have peace to get it.

But it seems like that people like Boehner, they can`t deliver on the deal.
And I`m worried here as an American. I am worried that we`re going to go
into a cataclysm here that`s not worthy of us as a country.

ROBINSON: Well, we`re already in a situation that`s not worthy of us as a
country. I mean, you have to -- you have to believe -- Boehner last week
was telling Republicans, and then it was being leaked, that he`s not going
to let the country default. He`s going to do what he has to do--

MATTHEWS: Do you believe that Boehner?

ROBINSON: Well, you know, I believe he meant that at the time. It`s hard
for me to believe that John Boehner wants to go down in history as the
speaker of the House who caused a massive default and economic catastrophe.

It could be that facing the obligation to cave on the government shutdown
and to cave on the default, he decided to stall, basically, and wrap to
them both together. If he`s got to figure a way to cave, he`ll just figure
it out once rather than twice.

MATTHEWS: Let me go back to Chuck on this conversation thing. How do you
read that? I asked Gene about it. "Conversation" sounds soft. It sounds
like, All we want is a commission. All we want is some side deal, a side
letter that I`ll -- I`ll bring the troops. I`ll get you the numbers.

TODD: Right.

MATTHEWS: But I want some kind of agreement to talk over entitlements,
talk over corporate tax reform and that sort of thing.

TODD: Well, I know (INAUDIBLE) what C word he never uses, and he doesn`t,
is "compromise." Right? That`s the real -- you know, Let`s have a
conversation, but there isn`t -- you know, the question is, can you come to
an agreement where everybody gets 50 percent of what they want?

MATTHEWS: Yes.

TODD: And in this political environment, I don`t think that`s possible on
the Republican side. I don`t think Boehner--

MATTHEWS: They don`t -- they don`t--

TODD: -- can sell--

MATTHEWS: They haven`t given --

TODD: -- 50 percent.

MATTHEWS: Without taking sides -- people know where I stand, but it seems
like they haven`t offered anything except the survival of the nation. You
can continue to survive and you can have health care, but everything else
we`re taking.

TODD: Right. No, I mean, that -- that -- they want -- you know, they`re
saying -- you know, they want -- as if the president should accept, Hey,
we`re going to default and you`re not going to -- and the -- shut down the
government. In exchange, you`ve got to give up health care--

MATTHEWS: Yes.

TODD: -- and you`ve got to give up this. So it isn`t a -- it isn`t a
rational negotiation, right?

MATTHEWS: I don`t think so.

TODD: This is -- it`s not, and I think that more and more folks get that.
I think Speaker Boehner himself knows that this is a bridge too far, which
is why he`s trying to change the -- now he`s talking about, Well, let`s
have a deficit conversation with the debt limit, which should have been the
demand from the very beginning--

MATTHEWS: Yes.

TODD: -- because that`s actually how it`s traditionally been used, not to
mix it in with --

MATTHEWS: It`s germane.

TODD: -- government operations and health care.

MATTHEWS: Instead of asking for Keystone and asking for offshore oil and
federal lands exploitation and everything else on their goody Santa Claus
list for the oil patch, that has nothing to do with reducing the debt.

Chuck, thank you so much. Gene, as always, sir, thank you for joining us
with your expertise.

We`ll be right back. By the way, Ted Cruz says he hasn`t shut down the
government, President Obama has. Ted Cruz says the debt ceiling`s the way
to go. Ted Cruz says his side`s winning the argument. So why exactly is
the GOP following him off the cliff?

Plus, the new TV unreality show, keeping up with the Republicans. How do
you negotiate with a party is that is contemptuous of facts, dismissive of
science and refuses to accept even the legitimacy of a Democratic
president?

Also, usually, it`s the Republicans who are united and the Democrats who
are divided. But this time, Democrats are solidly behind President Obama.
And so far, he hasn`t given an inch.

Finally, "Let Me Finish" with my recent life on the road and what I hear
people saying about this government shutdown and how they want something
better.

This is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: The government shutdown isn`t playing too well in Virginia. The
state`s Republican candidate for governor, Ken Cuccinelli, went out of his
way to avoid even being photographed by (sic) the shutdown`s ringleader,
Ted Cruz, didn`t want to be seen with the guy. Anyway, Cruz and Cuccinelli
both attended the annual fund-raising dinner Saturday night for the
conservative Family Foundation. But Cuccinelli didn`t mention Cruz even in
his speech and left before Cruz took the stage to praise him.

(BEGIN VIDEO CLIP)

SEN. TED CRUZ (R), TEXAS: I`ll tell you one thing about my friend,
Cuccinelli. He loves liberty and the Constitution more than praise from
"The Washington Post."

(END VIDEO CLIP)

MATTHEWS: Well, those words may not sit too well with the 175,000 federal
employees who live in Virginia. Much more on Ted Cruz when we return.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

CANDY CROWLEY, CNN HOST, "STATE OF THE UNION": Do you think you`ve hurt
the Republican Party brand?

CRUZ: Not remotely. But I also think far too many people are worried
about politics. Listen, if we worry about what is impacting the American
people, the politics will take care of itself. The politicians that are
gazing at polls, there is a reason why. The most common sentiment across
this country is that politicians in Washington aren`t listening to us.
There`s a reason why Congress has 10 to 15 percent approval rating.

(END VIDEO CLIP)

MATTHEWS: Welcome back to HARDBALL. Ted Cruz doesn`t think he`s hurting
the Republican brand, and many Republicans would beg to differ. Just last
week, a number of his Senate colleagues, Republican colleagues, confronted
him at a closed-door meeting. They wanted to know what his plan was for
how Republicans could win the shutdown battle he started. He couldn`t
offer a plan. According to "The New York Times," participants in that
meeting described it as a lynch mob.

In public, Cruz has read from the same script since the start of this
fight. His strategy seems to be blame the other side for everything he is
responsible for. In Cruz`s words, it`s Harry Reid and President Obama who
are forcing the shutdown. It`s the Democrats who are the extremists
unwilling to compromise. And the American people are firmly behind, guess
who, Cruz, despite polls showing huge majorities are not.

Well, who exactly is buying Cruz`s line at this point? Apparently, he is.

Joy Reid`s managing editor of Grio.com and Sam Stein is politics editor of
the Huffington Post. Both are MSNBC contributors.

Let`s go -- go now to Joy. Your thoughts. Let`s try to step into the
shoes and heart and brain of Senator Cruz. He`s a newcomer. He`s been in
Washington just about half a year. He beat the incumbent -- or the
establishment candidate, Dewhurst, down there, the lieutenant governor. He
is where he never expected to be, if he`s normal. But somehow, he`s
floating on air. He`s got this messianic thing going.

But how does that -- how does that overwhelm and trump and in almost every
case the observable facts? He caused the shutdown. He advertised for it,
promoted it, achieved in getting it going, and continues to goose, if you
will, any Republican or threaten with defeatism or treason any Republican
who doesn`t want to continue the fight. Your thoughts, Joy.

JOY REID, THEGRIO.COM, MSNBC CONTRIBUTOR: Yes, well, Chris, I mean, the
way that Cruz gets away with it is that he`s speaking to a closed room.
And in that room with the door sealed are only right-wing media allowed to
be heard.

And it`s coming really from the natural outgrowth of what Jim DeMint
started. Jim DeMint started this notion that says to the base of the
party, We are much more at war with the GOP establishment as we are with
the Democrats and Barack Obama. They`ve been selling us out.

In they minds, they are losing and losing and losing. They`re losing on
the culture war. They`re losing on fiscal matters. They feel -- to them,
they see the deficit exploding at their expense. They see all these
entitlements being given to minorities at their expense.

And they just want to win. They want to win at all costs and they want to
see somebody seeming to fight for them and to fight for them against all
odds. That`s the--

MATTHEWS: Walking--

REID: -- void that Cruz is filling.

MATTHEWS: Walking anger.

REID: Yes!

MATTHEWS: Anyway, listen carefully to how Cruz talks about the fight over
the shutdown. It`s like a hall of mirrors, if you will. The Democrats
caused the shutdown. Harry Reid and the president are the ones who want
the government from crisis to crisis. Let`s listen to Cruz world.

(BEGIN VIDEO CLIP)

CRUZ: Right now, we need to deal with the fact that a significant
percentage of the government is shut down because Harry Reid and President
Obama have refused to negotiate.

UNIDENTIFIED FEMALE: Do you feel responsible for what`s been happening to
people?

CRUZ: Look, I think it is indefensible that President Obama and Harry Reid
have forced a government shutdown. They shouldn`t have shut down the
government.

But the position of the Democrats -- it`s really remarkable -- is they want
100 percent. That`s why we`re facing this shutdown because their position
is extreme.

The Democrats want government by crisis. They want shutdowns. This is
Harry Reid`s shutdown because he thinks it benefits Democrats politically.
And they want to threaten a default to scare people.

(END VIDEO CLIP)

MATTHEWS: This is a new mode of communication, Sam. It`s sort of whining
aggressively.

I have never heard a man or a woman talk with such a whine in their voice
with a kind of a moral indignation. You notice how he closes his eyes, his
eyebrows comes down every time he expresses himself. He shakes his head
back and forth out of just a, oh, disappointment the way people are
talking. They don`t quite get it.

SAM STEIN, THE HUFFINGTON POST: Yes.

MATTHEWS: And it`s like the child that is not getting as many cookies as
his brother or sister looking at the parent saying, how come you gave her
more cookies than me? That look of indignation is so total with this guy.
He`s hurt. He`s hurt--

STEIN: Yes.

MATTHEWS: -- because he didn`t get to shut down Obamacare. He`s hurt.

STEIN: Yes.

I mean, for months, Ted Cruz was leading an effort designed specifically to
shut down the government unless Obamacare was defunded. That was the
mantra. That was the rallying cry. And then to turn around and say, oh,
it`s Harry Reid who is being absolutist about this is bizarre.

And it`s worth repeating many times over, I think, that even if they were
to pass a clean spending bill, it would fund the government at
sequestration levels, which would cripple President Obama and Senate
Democrats` domestic priorities. That`s hardly a 100 percent a my way or
the highway approach for Democrats.

In fact, I have talked to many Democrats who bemoan the fact that the
president agreed to do this. So, yes, he can talk as if this was all Harry
Reid`s fault, but it`s just not true. The facts of the matter just aren`t
there to support what he`s saying.

MATTHEWS: You can see it in the pictures there. And television is so good
at this, the pictures we`re watching on the left side of the screen, and we
have a split-screen up here, Joy.

And what you see is a guy who is really good at mixing it up. When he`s on
TV with independent people like Candy Crowley or George Stephanopoulos, and
he`s answering the question, it`s all defensive. Oh, woe is me. Oh, geez,
why don`t they be fair to me?

But you see him on the stump, the fingers are out pointing. It`s like Pat
Buchanan. He`s chopping away with that finger. He`s giving instructions
and he`s leading on the army. The minute he gets in the studio with an
objective questioner, it`s all, oh, woe is me. Doesn`t anybody see this
crap, or not? I don`t know. I see it.

REID: No, it`s absolute -- it`s absolute rope-a-dope.

And this guy is the perfect amalgamation of Rush Limbaugh and Jim DeMint.
On the political side, his whole theory, his whole theory of the case is
built on a lie. He is lying to the base of his party and promising them he
can deliver the end of the Affordable Care Act, which he should know --
he`s a smart man -- that he cannot do.

And so to build on that lie and to keep people behind him, he`s continuing
to tell more lies, which is that, well, this is really the Democrats.
They`re making me do this. I`m not a bad guy. I don`t want to shut the
government down. They do.

And it`s sort of this perfect pivot that he`s doing between the mainstream
media where he wants to, let`s face it, be a presidential candidate and his
base that wants to see a fighter who is getting down in the mud and
wrestling Obama to the mat.

(CROSSTALK)

MATTHEWS: He`s sort of a combination of Rush Limbaugh`s sort of, gee, woe
is me, the guy out there selling, all these feminazis coming at him. And
he`s always -- he`s just under attack, this poor guy, and DeMint`s
incredibly aggressive right-wingism, Sam. It is a mix. He sells like Jim
DeMint, who quit the Senate so he could sell even harder and go to the
Heritage Foundation.

STEIN: Yes.

MATTHEWS: But then he`s got that moral indignation. Oh, it`s just us and
we`re the victims here. And he has that -- it is an aggressive whine. I
have never seen it before in my life. An aggressive whine is what it is.

STEIN: But Joy was right to point out early on that there was a vacuum
that he filled. And that vacuum was for someone within the Republican
Party to launch shots at fellow Republicans.

And so it`s not surprising that they`re mad at him in these private
meetings. He`s aiding a campaign to target them with radio ads and
television ads in their home state. He recognized very early on that there
was a general disappointment among the conservative base over what their
elected officials had done, specifically with the last two presidential
campaigns. And he tapped into that.

The problem -- the problem he`s facing now is that there are limitations
within the confines of government to what he can do with that anger. And
so he`s got to figure out a way out of this. And part of this is to do
this rope-a-dope strategy.

MATTHEWS: Yes, well, the thing about the word, he was -- he`s so difficult
to follow on the trail here to keep track of, Joy, because he says he`s
against politics.

STEIN: Yes.

MATTHEWS: And there he was in Virginia this weekend building his support
base around the country.

Virginia is a very--

STEIN: Exactly.

MATTHEWS: -- as we all know, a swing state.

What is he doing in Virginia if he`s not running for president, Joy? Last
question.

REID: Well, first of all, he`s running for president in Virginia.

And for one thing, you have got Ken Cuccinelli, who`s drowning now, for a
lot of reasons, but not least of which is that the shutdown is particularly
biting in Virginia, and it`s really hurting Ken Cuccinelli, who has other
problems with being too far-right for that new electorate. So in rides Ted
Cruz, so that cosmetically to the base he can look like the savior of the
Republican Party there.

But Cuccinelli doesn`t want anything to do with him. Cuccinelli didn`t
even want to be on stage with him, because he, too, is trying to do a
balancing act between sort of your traditional Republicans and these guys.

MATTHEWS: Well, you know what he will have? Cuccinelli will one thing
that Cruz wants next year. He will be looking for a job.

(LAUGHTER)

(CROSSTALK)

MATTHEWS: He will looking for an administration that is going to give him
and give him a big job. It`s what Jimmy Carter too. You go around and you
round up the guys and women who just lost an election. It`s very smart
politics. Cuccinelli will be on the Cruz train.

You watch.

REID: Indeed.

MATTHEWS: And that`s what he`s recruiting is guys that are angry who may
have lost and most importantly are desperate to get a job in the next
administration.

Anyway, thank you, Joy Reid. Just watch this guy.

Anyway, Sam Stein.

Thank you, gentleman and lady.

STEIN: Thanks, Chris.

MATTHEWS: Up next, President Obama wades into the other debate in
Washington.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP, "SATURDAY NIGHT LIVE")

SETH MEYERS, ACTOR: Winners and losers.

(CHEERING AND APPLAUSE)

MEYERS: Loser, John Boehner.

I feel sorry for you, buddy. It`s exhausting watching you try to maintain
dignity while wrangling those Tea Party maniacs.

You`re like Seinfeld if there were 30 Kramers.

(LAUGHTER)

UNIDENTIFIED FEMALE: Loser, the Obamacare Web site, which had technical
issues all week because of too much Web traffic. You can`t campaign on the
fact that millions don`t have health care and then be surprised that
millions don`t have health care.

(LAUGHTER)

UNIDENTIFIED FEMALE: How could you not be ready? That`s like 1-800-
FLOWERS getting caught off guard by Valentine`s Day.

(LAUGHTER)

(END VIDEO CLIP)

MATTHEWS: Time now for the "Sideshow."

That was "SNL"`s "Weekend Update" on what proved to be an eventful week
down here in Washington, actually in Washington. But Seth Meyers wasn`t
the only one feeling bad for John Boehner. Here was Bill Maher on Friday
night.

(BEGIN VIDEO CLIP, "REAL TIME WITH BILL MAHER")

BILL MAHER, HOST, "REAL TIME WITH BILL MAHER": Poor John Boehner. Oh,
poor John Boehner.

He is in the middle of this Republican Party civil war, because there is a
war now going on with the Republicans between the Republican Party, the
old-school Republicans and the Tea Party. And the Tea Party is running the
show.

How do I put this to you? The Republican Party is like the corpse in
"Weekend at Bernie`s."

(LAUGHTER)

MAHER: And the Tea Party is like the two guys who put sunglasses and a
party hat on it and drag it around.

(LAUGHTER)

(END VIDEO CLIP)

MATTHEWS: And many on Twitter were surprised to find that the popular game
show "Family Feud" seemed to be -- seemed to be getting in on the action
with some harsh words for Boehner. Quote: "Speaker Boehner, stop letting
extremists sabotage our economy. End the Tea Party shutdown now. Speaker
Boehner, don`t let Ted Cruz run the U.S. -- well, the U.S."

But, as it turned out, the show says that its account was hacked. And the
tweet has been taken down.

Next up: He may have his hands full with the shutdown and debt limit
battles, but that didn`t stop President Obama from weighing in on a
longtime Washington debate over the name over the Washington Redskins. For
years, critics have charged that the Native American promotes ethnic
stereotyping, while the team defenders say it`s a testament to the courage
of American Indians.

Here`s what the president had to say in an interview with the Associated
Press.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I have got to say, if I were
the owner of the team, and I knew that there was a name of my team, even if
it had a storied history, that was offending a sizable group of people, I
would -- I would think -- I would think about changing it.

Native Americans feel pretty strongly about it. And I don`t know whether
our attachment to a particular name should override the real, legitimate
concerns that people have about these things.

(END VIDEO CLIP)

MATTHEWS: Well, in response, Redskins lawyer Lanny Davis came out to rebut
the president, citing a 2004 Annenberg Institute poll showing that nine out
of 10 Native Americans were not bothered by the name.

Up next: the reality denying Republicans. They make up their own facts, of
course, don`t believe science, and refuse to accept even the legitimacy of
President Obama. All that`s ahead.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MILISSA REHBERGER, MSNBC CORRESPONDENT: I`m Milissa Rehberger.

A philanthropist couple is donating $10 million to reopen Head Start
programs in six states. The donations will keep those programs running
through October.

Thousands in the Northeast are reporting power outages after severe storms
drenched the regions. Heavy rains and strong winds knocked down trees and
power lines.

And airport officials in Minneapolis are investigating how a 9-year-old boy
snuck past security and got on a plane to Las Vegas without a boarding pass
-- back to HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS: Just over a week from now, voters in New Jersey will go to the
polls to decide who will fill out the remaining term of the late Senator
Frank Lautenberg.

And while New York Mayor Cory Booker, the Democrat in the race, has been
the big favorite, there are signs that suggest this race is tightening.
Booker himself has gone negative in his latest ads against Tea Party
opponent Steve Lonegan. And today, New York Mayor Michael Bloomberg, one
of Booker`s allies, has begun spending more than a million dollars a day on
new TV ads to shore up Booker`s campaign. The election is next Wednesday,
October 16.

We will be right back.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL.

Well, the ability of Republicans to deny reality and operate in a fact-free
universe of their own has extended from science to the economy.

Here`s Senator Rand Paul on "Meet the Press" playing down the economic
catastrophe that would result from defaulting on our national debt, saying
the president is crying wolf.

(BEGIN VIDEO CLIP, "MEET THE PRESS WITH DAVID GREGORY")

SEN. RAND PAUL (R), KENTUCKY: I think it`s irresponsible of the president
and his men to even talk about default. There`s no reason for us to
default.

We bring in $250 billion in taxes every month. Our interest payment is $20
billion. Tell me why we would ever default? So, this is a game. This is
kind of like closing the World War II memorial. They all get out on TV and
they say, oh, we`re going to default.

(END VIDEO CLIP)

MATTHEWS: Well, and this morning, Wall Street veteran and former counselor
to the president, secretary -- treasury secretary, Steve Rattner, shot down
Paul`s theory, or, rather, argument.

(BEGIN VIDEO CLIP)

STEVEN RATTNER, FORMER ADVISER TO PRESIDENT OBAMA ON AUTO BAILOUT: What
Rand Paul is saying is completely irresponsible.

The idea that we can somehow go over this ceiling and somehow pay interest
on our debt, not pay an awful lot of other things, including Social
Security and Medicare and all kinds of other stuff, and still have an
intact credit rating, still have a functioning set of financial markets
that say, oh, yes, that`s no big deal, that is crazy.

(END VIDEO CLIP)

MATTHEWS: Well, not to be outdone, Florida Congressman Ted Yoho -- and you
know what party he`s in -- before joining Congress ran a successful large
animal veterinary practice.

He says default might be a good thing for the economy. "I think we need to
have that moment where we realize we`re going broke. I think, personally,
it would bring stability to the world markets, since they would be assured
that the United States had moved decisively to curb its debt."

We will take a moment for that to sink in. Yoho is saying a default would
stabilize world markets.

Well, here`s Treasury Secretary Jack Lew on the subject he knows something
about.

(BEGIN VIDEO CLIP)

JACK LEW, TREASURY SECRETARY: For people to say we want to know the last
minute to act, we want to know the last dollar, even getting close to the
line is dangerous. We saw in 2011, there was no default in 2011. It hurt
the economy to get close to the line.

We saw it in the stock market. We saw it in confidence. We saw it in
investment. If we cross the line, we`re going to a place we`ve never gone.
It`s very dangerous.

(END VIDEO CLIP)

MATTHEWS: To paraphrase to Daniel Patrick Moynihan, Republicans may be
entitled to their own opinion, but not certainly to their own facts.

Wayne Slater is senior political reporter for "The Dallas Morning News",
and Richard Wolffe is vice president and executive editor of MSNBC.com.

Richard, I want to start with this about fact denial. And this -- we had
it on the show with King, the congressman from Iowa, who basically said I
don`t know anything about international economics. I don`t talk to
international economists. Don`t know about American economists. Don`t
talk to them.

I know what I`m talking about when it comes to national debt and world
markets because, quote, "I raised a family."

RICHARD WOLFFE, MSNBC.COM: Right.

MATTHEWS: This kind of horse sense is like saying, well, why don`t you fix
your own TV, why don`t you do your own plumbing, why don`t you fix your own
car? Because there are people that know how to do things better than we
do. That`s why we do it.

And economists have a better bet of figuring out the implications of a
national default than somebody -- some joker that just says I raised a
family. Everybody`s raised a family. Very few of us understand
international markets.

WOLFFE: Yes. But, Chris, even if you have raised a family, you know that
you cannot sort of leave your gas bill to one side and then say, well, I`m
just going to pay the electricity bill this month and it`s going to be OK.
The point is all of these things get reported. Even if you were just
thinking running the world`s largest economy, being the reserve currency
was just like running your household budget.

This doesn`t work for a household budget. And more than that -- and it`s
not as important, but it is important if you are a conservative, if you`re
a Republican and you think this is a winning strategy for you. What
message does it send to go out and say we really believe that this
president doesn`t understand about deficits, we do, but we don`t understand
anything about default? It doesn`t make any sense. Even in their own
terms, if you`re not an expert, don`t talk about debt and deficits and go
back to whatever you want to do.

MATTHEWS: This is a gamble, you could argue, for the right someone like
Ted Cruz, who you cover, Wayne. And for him to gamble with the -- after
all the shouting and Gotterdammerung, we`re back in a situation three days
before the 17th next week, that somewhere around the 14th, which is seven
days from now, they do reach some sane conclusion of this scary thing. And
he gets credit for having pushed them along the way, but not so dangerously
as to have killed the economy.

WAYNE SLATER, DALLAS MORNING NEWS: Yes, absolutely.

MATTHEWS: At what point does he begin to worry? Does he ever worry, this
guy with the strange look of moral indignation?

SLATER: I don`t -- I`ve been around him a lot, I don`t think he worries
very much. I think he clearly thinks that there`s going to something
happen that suggests they win. There`s something Charlie Sheen-esque about
saying we`re winning when in fact it doesn`t appear that they are.

On the other hand, what we really have here is a situation where people
like Cruz, Cruz and company, know that, as you said, they can win. So long
as there is fundamentally some deal, something happens, the debt ceiling is
raised, that Republicans get something. It`s not good enough, but it`s
enough to drive folks -- the constituents who would vote for them in the
future -- and fire them up.

I mean, I`ve said this before. This is sort of a "Breaking Bad" model
where you have Mr. White who for five seasons never said anything that was
true. But in the process, he kept alive, he made a lot of blue meth for
some people and he built a bankroll that benefited him, at least his family
in the end. That`s what Cruz hopes.

MATTHEWS: He`s playing for time. You know, I`ve studied Joe McCarthy and
his tactics. Not to say these guys are the same although there was an
unfortunate overlap in the Hagel hearings. But, Richard, what McCarthy
used to do was announce in the morning I`m going to name names. And then
the morning papers or afternoon papers would say McCarthy to name names.

Then, he`d have a press conference and not name names. He`d say I`ve got
in my hand a list of names and my bag here, a list of 200 names in the
State Department who are communists -- and never had to release the
numbers, the names.

He was constantly promising he would deliver something and he kept the ball
rolling to the point the whole country was terrified of him because it
seemed at any moment he might name you. And in fact, he never did really
except in the horrible cases of the public servants, he did, but not the
politicians.

WOLFFE: I actually normally think McCarthy comparisons are kind of
overdone, but this is politics by terrorizing people. You know, they`re
trying to say default is a really big thing, we`re all going broke, but
it`s no big thing right now because it`s not real.

And constantly this whipsaw that they`re playing here is very real. Look
at the markets today. You cannot be -- I hate to come back to this, but
you cannot be the world`s reserve currency and play these games.

So just pick up your "Wall Street Journal", your "Financial Times", your
"Economist", and see what the rest of the world and especially the
financial people are saying about this. And it`s as bad people saying
you`re undermining our democracy.

Undermining the world economy is a really serious proposition and it goes
way beyond whatever Ted Cruz thinks he`s doing or whether Rand Paul thinks
they`re doing for 2016.

MATTHEWS: I`m wondering, Wayne, at what point between now and the 17th Mr.
Cruz recognizes that he`s not only playing with dynamite. He`s pulled the
pin on the grenade.

SLATER: I think he won`t change anything at that point. But it`s up to
other more responsible Republicans and obviously Democrats to do something
about it.

I mean, we`re playing a game here. Yes, it is a game, but they`re
different games. And if, in fact, your game is about building a
constituency or constituents around you that are good in the end, then
fine.

You talk to Rick Perry here in Texas, and he said even though we have
millions of people uninsured, there`s nobody`s uninsured here. Everybody
has health care. That`s demonstrably false.

In the campaign when Ted Cruz is running for Senate, he said the U.N. is
going to come in and take over your golf course. That`s not what`s
happened. But for the group of people who believe that, who are
predisposed to believe that and a politician is willing to deliver it,
those are people down the line who will be your folks.

Meanwhile, our larger government is playing with the real game and playing
with fire.

MATTHEWS: Texas, where John Cornyn is the reasonable man.

Anyway, thank you for joining us, Wayne Slater. What a state. Not to
knock the people, but your election processes.

Richard Wolffe, thank you, sir.

WOLFFE: Thanks, Chris.

MATTHEWS: And Wayne Slater.

Up next, the big reason President Obama is standing his ground. That`s the
big interesting thing. The Democrats are united. Not Democrats in
disarray. Democrats together. And this is unique.

And also, it`s the place for politics.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Just vote. Let every member
of Congress vote their conscience. They can determine whether or not they
want to shut the government down.

(END VIDEO CLIP)

MATTHEWS: We`re back.

That was a confident President Obama today at FEMA headquarters in
Washington as we enter week two of the government shutdown, we`re watching
an emboldened President Obama. The president stuck to his guns and refused
to yield any wiggle room to the Republicans over the Affordable Care Act.

And one reason the president`s so confident, Democrats in Congress are
united behind him right now.

On Saturday, the House Democratic leadership released a letter with 195
members of the caucus who say they will support a clean continuing
resolution to reopen the government. Two of those members of the
Democratic Caucus join me now: Representative Jim Moran, Democrat from
Virginia, and Representative Jim McDermott, Democrat from Washington state.

Congressman Moran, do you think if Boehner -- the speaker of the House and
he has the power to do it -- calls up a vote on a clean C.R., continuing
resolution, to get the government back to work tonight, would it pass?

REP. JIM MORAN (D), VIRGINIA: Absolutely. I`ve talked to two or three
dozen Republicans who have indicated that they would vote for it. I`m
confident that it would vote pretty decisively if the speaker would just
let a clean continuing resolution come to the floor of the House.

President Obama is right on this. Unfortunately, Speaker Boehner has
reversed himself. I don`t know why. Probably out of pressure.

But he is incorrect when he said Sunday that it wouldn`t pass. It would
pass. There is no question about it in my mind.

MATTHEWS: Mr. McDermott, what is this about? We all watch this guy. I`ve
said this before, it reminds me of a Jack Lemmon character in his later --
kind of nervous business guy who`s done something wrong and his business is
in shambles and he just looks like hell.

Why does he worry about -- if it`s only 30 or 40 members in his caucus, who
are the wild guys out there, why does he worry so much about them? Why
doesn`t he just say, I`m going by, I`m going to go with the majority. I
didn`t get a majority of my caucus, I don`t need all the crazies.

Why doesn`t he do it that way?

REP. JIM MCDERMOTT (D), WASHINGTON STATE: Well, let`s play it out for a
second. Suppose he called for a clean vote. Put it out there, 30
Republicans, 195 Democrats went for it. It passed. He is afraid that the
next action in his caucus will be to remove him from speaker.

Now, think about it. Here is a guy that is now a hero for the American
people. He has put our country back together. It is working, the
government is working.

And their next act is going to cut off his head as speaker? No, that`s not
going off to happen. He needs to have the nerve and the guts to stand up
to those 30 guys, 40, whatever it is, and say, "Look, you won`t help me. I
am going next door and I`m getting the votes because I care about my
country."

That`s what John Boehner has to do. If he did that, he would have nothing
to worry about.

MATTHEWS: Well, let me ask you, Jim Moran, Congressman, what is it -- who
is on his life line, who`s the chief of staff? Who does he trust? Cantor
from your state, McCarthy from California, who is in the inner circle
that`s spooking him? somebody must saying you`d better be careful.

We got a sense that every time he came back from the White House with
Obama, he`d have a deal hash out. Next, he`ll hear from the chief of
staff, didn`t hear from Cantor, and all of a sudden, he loses his guts
again. Who is scaring, who`s telling him, "Everything you guys are saying
is wrong"?

MORAN: Chris, I don`t think it is in his office or in the caucus. I think
outside money and outside media. It`s the Rush Limbaughs of the world, FOX
News, it`s the Koch brothers, it`s all those three dozen organizations that
were talked about on the front page of "The New York Times" yesterday. I
think it`s-- the money and it`s the media.

And so, I think he feels constrained with a very tight parameters of what
they instruct him to do.

MATTHEWS: Mr. McDermott, are you and your colleagues, almost 100 of them,
Democrats, are you confident the president has the winning hand here? At
what point, do you think, it will it get hot for the Democrats, as well as
the Republicans, as you approach 10 days from now the shutdown, not
shutdown, but the debt default?

MCDERMOTT: I think we do because I think the president is right. We
cannot -- you can`t bargain the debt limit increase. You could say, let`s
raise it a little bit, or for a week, or two. That`s going to throw the
world economy into chaos.

MATTHEWS: Yes.

MCDERMOTT: The president cannot do that. I don`t think he will do it. I
think if he sticks to his guns. Ultimately, the Wall Street boys are going
to come down and say, look, John, you want to play golf with us, you better
take that out on the floor and get it clean.

(CROSSTALK)

MATTHEWS: This two-month -- Chuck Todd was talking about it from the White
House. The press is hearing about a two month proposal. I don`t think
anything would be accomplished in two months that couldn`t be accomplished
right now.

Your thoughts, again, Mr. McDermott.

MCDERMOTT: I think it would be a mistake to go for a short one. You ought
to raise it so that you can get through the next six months or next year.
It doesn`t -- we are going to raise the debt limit. We have raised it 111
times, since Clinton was president of the United States.

And we`re going to raise it again and again and again. And you might as
well just admit it. And do it. It`s silly and very, very bad for the
country not to go ahead and do it.

MATTHEWS: Mr. Moran, you represent the district right across the Potomac
from the White House. You walk -- every day when you walk around old town
Alexandria, you bump in to people who work for the federal government who
are off right now. What is the mood in terms of this shutdown?

MORAN: They`re distraught, Chris. These are people who want to be
working. Fortunately, we were able to get our bill passed on Saturday that
will pay them. I think that makes it a very compelling case that if we are
going to pay them, they ought to be working and they want to be working for
their pay.

But it`s also contractors. There are even more contractors and federal
employees that are out of work. This is going to take a big bite out of
our economy, probably billions of dollars. But it will be all over the
country.

You know, the American people, the business community, they need some
stability. They need some confidence regained in their government. So,
this funding for a very short of period of time, let alone lifting the debt
ceiling for a very short of period, I completely agree with my friend, Jim
McDermott, you know, if that doesn`t work, we`ve got to resolve this and
resolve it for some extended period time.

MATTHEWS: I am so glad to hear you gentlemen say that. That seems to be
he strong, smart position.

Thank you, U.S. Congressman Jim Moran of Virginia, U.S. Congressman Jim
McDermott of Washington, the state of Washington.

And we`ll be right back after this.

(COMMERCIAL BREAK)

MATTHEWS: Let me finish tonight with this:

As I said up front tonight, I`m out here in San Francisco on my book tour.
Willie Brown, the former mayor of this beautiful city, held a party for me
last night in Northeast (ph). Secretary of State George Schultz was there,
as well a great get-together of the mayor`s friends, Kathleen, the queen,
and some other family members and friends.

Two-term Lieutenant Governor Tom O`Neill, the speaker son had a big party
for "Tip and the Gipper: When Politics Worked" Friday night up in Boston.

Everyone talked in both places how much they missed the time when
politicians left and right could find a bottom line agreement on their
fights. They didn`t have to go on forever and risk the country`s faith and
credit. Everyone has shown a real nostalgia for when politics not only
worked but was actually -- dare I say it today -- fun.

Tonight, I take the cause to the Commonwealth Club, and then, tomorrow, to
the World Affairs Council out here, and then to the Ronald Reagan Library
on Wednesday night. Jay Leno and "The Tonight Show" on Thursday. Bill
Maher in "Real Time" Friday.
I have to say, how thrilled I`ve been at the reaction people are showing to
an upbeat, positive, and powerful look at how we Americans can make
politics work in this country, for our point of view and for the country.
It`s not a fantasy what went on between the Republican President Ronald
Reagan and Democratic Speaker Tip O`Neill. It`s the truth. I was there.

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

"ALL IN WITH CHRIS HAYES" starts right now.


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