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updated 10/11/2013 12:30:51 PM ET 2013-10-11T16:30:51

HARDBALL
October 10, 2013
Guest: Jim Moore, Nicholas Confessore, Kathleen Parker, Jonathan Allen,
Lizz Winstead

CHRIS MATTHEWS, HOST: Bitter tea.

Let`s play HARDBALL.

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

"Let Me Start" tonight with this. Tonight, the sky is falling on the
Republican hard-liners. They threatened to bring down not just the
Affordable Care Act, not just the American government itself, but this
country`s economic position in the world. Well, faced with a tsunami of
bad poll numbers -- especially for Ted Cruz, his unfavorables have doubled
as more people have discovered him and his tactics, the fewer they like
what they`re learning.

But it`s the whole party that`s taking a beating tonight. People
don`t like having their government held captive, don`t like their economy
being threatened. And guess what? They now like the president`s health
care plan a lot more.

It hurts the country too much to laugh, but let`s face it, even the
Republicans are facing it tonight. They followed the wrong leader into the
wilderness. They went off a cliff because an unknowing bugle boy out there
blew "Charge" into the nasty winds of reality. They got dragooned into a
cause that nobody on the right can even explain now.

Did Ted Cruz have only one cause? Could it have been Ted Cruz?

And is John Boehner about to take back the banner of leadership? Can
he? Will he, before his party is driven even further into chaos and
regret? And will he?

Chuck Todd`s NBC`s chief White House correspondent and political
director. Ed Rendell was governor of Pennsylvania. Michael Steele was
chairman of the Republican National Committee.

There have been major developments in Washington today, with John
Boehner proposing now a six-week debt ceiling increase, but the government
would remain shut under his plan. And Republicans are calling for
negotiations now to work out a longer deal on the budget, on the debt, and
then to reopen government after that. Republican leaders went to the White
House today for a meeting with President Obama late this afternoon.

Just in the last half hour, NBC News has released the results of its
latest poll, and it is devastating for Republicans. When asked who do they
blame more for the government shutdown, 53 percent, a majority, said
Republicans in Congress. Just 31 percent said the president. That`s a 22-
point gap.

Meanwhile, 70 percent of Americans say Congressional Republicans are
putting their own political agenda ahead of what`s good for the country.
Even 40 percent of Republicans say that. Just about a quarter of Americans
say Republicans are demonstrating leadership and standing for what they
believe in, a minority opinion.

And when asked what they want the makeup of the next Congress to look
like, 39 percent of Americans say they want it to be Republican-controlled,
while nearly 50 percent now say they want the Democrats back in charge.

Chuck, this is something. I get the sense this is an historic poll.

CHUCK TODD, NBC WHITE HOUSE CORRESPONDENT/POLITICAL DIR.: It is. And
look, there`s no bones about it, the shutdown has been an unmitigated
political disaster for the GOP.

There`s more numbers in here. Their negative rating of 53 percent in
our poll is historic. They have never been that low in the nearly 25-year
history of this poll. You`ve got the two numbers that you pointed out.
They`ve got 22-point advantage on getting the blame for the shutdown, the
fact that even 40 percent of Republicans, essentially the non-Tea Party
Republicans -- and that`s a whole separate story, Chris. There is a stark
divide inside the Republican Party that`s going to start playing itself out
the longer this goes on.

But when you even have 40 percent of those non-Tea Party Republicans
saying they`re putting politics ahead of the country -- look, the president
-- his approval rating actually went up a couple of points. Hostility
toward the health care law has lessened.

All -- everything that this shutdown was supposed to be about for
Republicans has boomeranged on them.

MATTHEWS: You have two of the top pollsters in the country, Bill
McInturf, a highly respected Republican pollster...

TODD: Yes.

MATTHEWS: ... and Peter Hart, who`s been around forever and much
trusted as a Democratic pollster. Do they agree on this surmise, that this
is really a one-sided fault line right now that`s really gone in one
direction?

TODD: Both of them used the same phrase, Chris, when they looked at
these numbers. And they just said "jaw-dropping." Peter Hart said in his
30, 40 years of polling, you only get this about four or five times in a
lifetime, a poll that is so resounding, that`s so -- moves in such a quick
and fast way as these numbers did, that it was surprising to him.

But they both offer a warning here. It`s not a see-saw for the
Democrats in this poll. It is a -- basically, a big lead rock for the
Republicans. But it`s not all transferring to the Democrats. There is
some. They`re getting boosted a little bit on that generic ballot.

But what you really have here is a public that is angry and fed up.
They clearly believe these Republicans have driven -- are driving the
country off a cliff right now with this shutdown hurting the economy. They
feel terrible about the direction of the country.

But Peter Hart would caution that Democrats shouldn`t be jumping up
and down here because it`s creating a public that is really distrustful of
Washington being able to solve problems.

MATTHEWS: Last question. Compare it to Watergate.

TODD: Well, compared to Watergate, I mean, that`s -- that`s the -- is
it Watergate levels? Well, if this were October 2014, you might be talking
about something like this. This is wave-type numbers, if this were a month
out from the election. But we`re not a month out from the election.

MATTHEWS: I got that.

TODD: And we`ve got...

MATTHEWS: Governor...

TODD: You know, you`ve got more than a year.

MATTHEWS: Governor Rendell, you`ve been through a lot of elections.
Let`s talk about this. One number that struck me, not just the partisan
tilt against Republicans, the country`s really angry. You can hear it in
the comedians` voices. You can hear it in the country, the street corner.
They`re really ticked.

I have never seen a number like this -- 78 percent of the American
people, four out of five, now believe this country is headed in the wrong
direction. I`ve never seen such unity of opinion that whatever`s going on
in D.C. right now, they don`t like.

ED RENDELL (D-PA), FMR. GOV., MSNBC POLITICAL ANALYST: And that`s
solely driven, Chris, by the politics, not by the economy or anything else,
solely driven by our inability to function as a government.

And the Republicans are bearing the brunt of this. It`s not just the
NBC poll. Gallup says it`s 28 percent people feel favorable about the
Republican Party, down from 38 percent last month, 62 percent unfavorable.
Those are crushing numbers, crushing numbers.

MATTHEWS: Let me go back to Michael. You`ve had experience in that
party, the Republican Party. You`ve led it in the past recently. It seems
to me like this -- it`s not about values. People do think the debt is too
big. People do worry about the deficit. People do have questions about
health care, the new health care law. All that`s legitimate debate in a
democracy. That`s what we do. We fight and argue.

It`s about tactics. I think Ted Cruz is recognized now as the bad
guy. I think Ted Cruz said, starting this summer, Let`s use the debt,
let`s use the government shutdown as a tool, a weapon, if you will, to
screw health care or to kill the baby in its crib, if you will. And I
don`t think he`s right. And I don`t think the Republican (ph) people in
this country watching this show or any show think he was right. They think
he caused this mayhem.

Your thoughts.

MICHAEL STEELE, FMR. RNC CHAIR, MSNBC POLITICAL ANALYST: I don`t -- I
don`t think I`d go that far. I don`t think there was that much thought put
into this, to be quite honest about it. I think...

MATTHEWS: By him?

STEELE: By anybody, quite frankly, Chris. There was a political
vacuum created, with a lack of a strategy, a lack of a message, and a lack
of a direction in leading the country through a conversation on "Obama
care," number one, and now into this period where we`re trying to link this
to debt ceiling.

And Ted Cruz filled that void. He filled that vacuum with his own
message and his own sense of where he thought the country should be heading
on this, and he brought the party into it.

There was very little resistance at first. There was a lot of the
back room chatter that we hear, but it didn`t amount to too much. There
was no concise, precise effort by the leadership to move this thing in a
different direction. You had people talking about the fight is not on
"Obama care"...

MATTHEWS: Do you think John Boehner...

TODD: ... it`s on something else.

MATTHEWS: ... likes being called -- do you think John Boehner likes
being called a vacuum? Because I think you`re right.

STEELE: I`m not calling...

(CROSSTALK)

MATTHEWS: You said there was a vacuum there.

STEELE: Chris, you personalize it. I`m not personalizing it to John
Boehner. I`m saying the Republican Party as a whole left a vacuum in the
conversation with respect to what it wanted to do. Forty votes on "Obama
care" was not a conversation with the American people. And now we`re up
against a wall on the debt ceiling, and we have that reality now trying to
be, you know, conflict -- you know, conflagated (sic) into a conversation
on the debt.

So I just -- I just think right now...

MATTHEWS: OK...

STEELE: ... the poll numbers bear out what Chuck said. The country
is pissed, and they`re pissed at us. And now we`ve got to do something
with this going forward. And if we don`t, this gets worse. There`s more
bottom to hit before it gets better.

MATTHEWS: Let me go back to Chuck on the numbers and how you analyze
them objectively. And The Wall Street Journal -- NBC poll is dead
objective. It is a very strong non-partisan effort here, and it`s gotten a
record over the years of being the poll -- especially the one that I point
out, which is the "wrong direction" poll -- 78 percent, Chuck.

It seems to me that that anger is going to find its way to somebody...

TODD: That`s right.

MATTHEWS: ... maybe not Ted Cruz, although I think he will get a lot
of it inside Washington. I saw his numbers, his negatives in just the time
we`ve heard of him, since June, have doubled from 18 to 36 percent. He`s
climbing in the villain category.

TODD: He is, but this really is -- the aim is Congress and it`s
congressional Republicans. And this 78 percent number, we`ve only hit that
one other time in the 25-year history, and that was right after Lehman
Brothers collapsed, OK?

MATTHEWS: Yes.

TODD: Basically, the worst economic recession since the Great
Depression, we hit 78 percent. And this political crisis that has been
caused on Capitol Hill by the Tea Party Republicans in what we`re sitting
(ph) right now has equaled that. It is -- we are in a political
depression, a great political depression.

MATTHEWS: Well said.

TODD: That`s what these poll numbers are showing. So it is -- you
know, it is an angry public. And when you look at it inside, Democrats are
rallying around the president. That`s why his numbers went up. His
numbers didn`t go up among independents.

Independents are sour on everybody. They`re not happy. But boy,
they`re really sour on the Republicans and they really believe the
Republicans are the ones being politically -- that are playing politics
here, much more so than they believe the president is, or congressional
Democrats.

MATTHEWS: Thanks for giving us that great report on the new poll just
out tonight. Chuck Todd, thank you.

According to Politico, by the way, Speaker Boehner told congressional
Republicans this morning, quote, "We can`t fight on two fronts." That`s
when he proposed raising the debt ceiling for just six weeks in exchange
for negotiations with the president over the shutdown and a further
increase in the debt ceiling.

Let`s watch him.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: What we want to do is
to offer the president today the ability to move, a temporary increase in
the debt ceiling, an agreement to go to conference on the budget, for his
willingness to sit down and discuss with us a way forward to reopen the
government.

(END VIDEO CLIP)

MATTHEWS: Well, he looks a little happier there.

Anyway, White House spokesman Jay Carney reacted cautiously to the
Republican proposal from Boehner. Here`s Jay.

(BEGIN VIDEO CLIP)

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: The president is happy that
cooler heads at least seem to be prevailing in the House, that there at
least seems to be a recognition that default is not an option. You know,
we`ll see what the House Republicans propose. We`ll see what they`re able
to pass and consider it then.

(END VIDEO CLIP)

MATTHEWS: Well, this afternoon, after meeting with the president,
Senate Majority Leader Harry Reid was asked if the Senate would vote on a
debt ceiling extension without first reopening the U.S. government. Reid
said "Not going to happen."

Let me go to Governor Rendell. It looks to me like this -- this is
going to go on, whatever Mickey Mouse solution they come up to in the next
few days, perhaps meeting the debt ceiling timetable.

This is going to continue, this inability to think large and not go
for the other guys below the belt. I mean, why didn`t the Republicans say,
Look, the country doesn`t like debt. Nobody likes debt. They don`t like
deficit spending. Nobody likes it. We`re going to do something about it.

Instead, they went after the baby, the one thing the president created
in his history that he will never give up on. They said, Here`s a non-
negotiable position. Screw you. It was -- it`s -- to me, that`s not
negotiating, I don`t think.

RENDELL: No, you`re right, Chris. And in fact, you can see they`ve
abandoned that. There`s no talk of the health care act at all anymore.
They should have fought on debt.

And right now, they`re taking the wrong strategy because the American
people are more concerned on a day-to-day basis with the shutdown of the
government than the debt ceiling, even though the debt ceiling would be
more catastrophic. They don`t understand the debt ceiling, and they
generally think the debt should stay low. But they do know the
consequences of the government shutdown.

What the Republicans ought to do is say, OK, we`re going to reopen the
government. We`re going to raise the debt level for six weeks. And in
that six-week period, we`re going to try to negotiate to do something that
will in the long-term reduce the debt.

That would get them back on solid ideological grounds and grounds that
a lot of Americans agree with. But they`ve chosen again the wrong avenue,
and they`re going to pay for it.

MATTHEWS: They got the red hots to deal with. Anyway, thank you,
Governor Rendell. Thank you, Michael Steele.

Coming up, the man who led the Republicans into this abyss, rather
over this abyss, Ted Cruz. With each day, he looks more and more like a
Roman candle, all noise and bright lights but burning out in spectacular
fashion.

Plus, big business`s big mistake. They backed Tea Party candidates.
They funded the Republican redistricting and gerrymandering, and now they
find they may not be able to slay the monster, the Frankenstein`s monster
they created.

Also, isn`t it interesting how much of the government -- government! -
- the Republicans want to fund, now that they`ve shut it down? Head Start,
fund it. Cancer research, fund it. National parks, air safety, fund it.
Veterans, fund it, fund it, fund it. Funny how much Republicans like
government now when they`re getting hurt for shutting it down, isn`t it?

And "Let Me Finish" tonight with how the last few weeks have given
people a healthy American appetite, let`s face it, for better politics,
even if it`s a memory of better politics.

And this is HARDBALL, place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Last night was the final debate in the New Jersey special
Senate election between Democrat Cory Booker and Republican Steve Lonegan.
And with Booker holding onto a lead in the polls, Lonegan went on the
attack.

(BEGIN VIDEO CLIP)

STEVE LONEGAN (R), NEW JERSEY SENATE CANDIDATE: You may not be able
to swim in that river, but it`s probably, I think, because of all the
bodies floating around from shooting victims in your city.

(LAUGHTER)

CORY BOOKER (D), NEWARK MAYOR, NEW JERSEY SENATE CANDIDATE: Oh, my
God.

LONEGAN: The fact is...

BOOKER: Oh, my God!

(BEGIN VIDEO CLIP)

MATTHEWS: Lonegan also blew a not so subtle dogwhistle.

(BEGIN VIDEO CLIP)

LONEGAN: All that income tax and sales tax money gets poured into the
big black hole of Newark. The biggest portion of our tax dollars goes to
Newark, New Jersey!

(END VIDEO CLIP)

MATTHEWS: Did you catch that, "big black hole" of Newark? Well,
Lonegan also cited Ted Cruz among the senators he most admires. And on
Saturday, Sarah Palin`s coming to New Jersey to campaign with him. The
election is next Wednesday.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. I`ve compared Ted Cruz of Texas
to a lot of things, I guess, and his political ascent to me, however, has
most resembled a Roman candle, burning hot and short.

But is the Roman candle from Texas already at risk of flaming out?
He`s facing nasty winds from an awful lot of his fellow Republicans lately.

Grover Norquist, president of Americans for Tax Reform and originator
of that pledge against raising taxes, has described Cruz as having fumbled
the ball. Quote, "I think it was very possible for us to delay the
implementation of `Obama care` for a year, until Cruz came along and
crashed and burned."

Well, Republican senator Tom Coburn of Oklahoma gave Cruz the "I love
him, but" treatment on Laura Ingraham`s radio show.

(BEGIN AUDIO CLIP)

SEN. TED COBURN (R), OKLAHOMA: I love Ted Cruz. I love the fact that
he`s got the -- the -- the pee and vinegar in him to want to take on
things. But I believe if you`re going to -- if you`re going to try to win
battles, you ought to pick battles that you can win, rather than kill your
troops going up a hill on one you can`t.

(END AUDIO CLIP)

MATTHEWS: And last week, Republican senator Ron Johnson called Cruz`s
tactics to gut "Obama care" "intellectually dishonest."

(BEGIN VIDEO CLIP)

SEN. RON JOHNSON (R), WISCONSIN: I think it`s very appropriate that
we ask people that, you know, led this defund effort, which I would say, in
the end, ended up being pretty intellectually dishonest, because there
really was never a chance in today`s situation with today`s reality of that
-- of that working.

(END VIDEO CLIP)

MATTHEWS: And if "People" magazine is any indication, Senator Cruz is
certainly becoming better known, although the magazine cover is of Prince
Harry and his new girlfriend. But inside, complete with full-page photo,
is a feature on Senator Ted Cruz.

Jim Moore is a political analyst and communications strategist in
Texas who`s covered Senator Cruz. Joan Walsh is an MSNBC contributor and
editor-at-large of Salon.

Joan, what`s interesting about this guy is since June, he`s gotten
better known and doubly hated. It`s unbelievable. The faster he rises,
the more he`s singled out as someone people don`t approve of. It`s very
fast. I think he`s a Roman candle -- up, lots of excitement -- here it is,
the (INAUDIBLE) poll shows Ted Cruz is not wearing well with the American
public. He`s better known now than he was in June, but his unfavorables,
as I just said -- look at them!

JOAN WALSH, SALON.COM, MSNBC POLITICAL ANALYST: Unbelievable.

MATTHEWS: Up to 36 percent from 18. This guy is going nowhere.
What`s your thought?

WALSH: I agree he`s going nowhere. He brought together left and
right. We all agree we don`t like him. So that`s one thing. I think he`s
really hurt himself politically in the long run. I used to fear him as a
2016 contender, Chris, and I don`t so much anymore.

I never thought he could win the presidency. He can`t. But I thought
he had a shot at the nomination. But he is so universally disliked, I
think he`s really hurt himself.

I do want to say, though, you know, Ron Johnson and Tom Coburn are
both -- they don`t really deserve a whole lot more credit because both of
them are default deniers. They say it doesn`t really matter if we default,
it`s a cash management problem. And they have voted in lockstep with Ted
Cruz. They haven`t voted on a clean CR. They voted -- they voted it down.
Harry Reid has only passed that with Democrats. So, I think he`s succeeded
in pulling his party to the right, even though, personally, he`s destroyed
his popularity.

MATTHEWS: You know, Jim Moore, thanks for joining us.

JAMES MOORE, CO-AUTHOR, "BUSH`S BRAIN": Sure.

MATTHEWS: I want you to look inside this guy from closer range. You
know, one of the reasons people believe that Joe McCarthy, who has a
stylistic comparison to this guy, failed is because he didn`t believe in
the anti-Communist cause. It was just a way for him to get reelected and
create some excitement about himself, because he drank himself to death.

And writers like Richard Rovere have said, you know, if he really
believed in his cause, he wouldn`t have killed himself. He wouldn`t have
destroyed himself. He would have followed -- even after being censured, he
would have kept fighting if he really believed in what he believed -- or
said he believed in.

What`s Ted Cruz believe in?

MOORE: Well, I do think, Chris, that he is a strict constructionist.
He thinks that the Constitution is guiding his politics.

And I wouldn`t say that he has deeply held principles, but he is going
in that direction. But one thing that you have to say about him that is
undeniable is that he loves the klieg lights. He wants to be the center of
attention.

This is a very charismatic man. He loves being on stage and
commanding a room. And I don`t think there`s any underestimating that part
of politics that he enjoys. But he also wants to blow up things that he
doesn`t believe in and things that he thinks are wrong.

I think the attention party is equally important to him.

MATTHEWS: He seems to be a self-loathing Republican. He doesn`t like
the party he`s in. And at this luncheon last week, members came outside
and said he wouldn`t even defend his colleagues against onslaughts from
people further to the right.

He doesn`t seem to have any loyalty to the party. What is he loyal to
then? And why did he join the Republican Party if he isn`t loyal to it?
What`s he believe in? Why is he Republican?

MOORE: Well, I think he is, but only in the sense that Tea Party
Republicans are Republicans, that people are borderline anarchists, that
they don`t believe the government has any real role or function beyond
protecting the borders and paving the roads, and then getting the hell out
of the way.

And that`s what Ted Cruz is working for. He doesn`t believe in
taxation. He doesn`t believe in the basic needs being provided in any way
by the federal government. We`re all in this on our own. And if he can
effect that, he makes the Tea Party happy and he makes himself happy.

But, again, I want to stress this thing about Ted liking attention,
because this is very much a case of a guy who loves it, and he thinks he`s
going to be the nominee for president in 2016 for the GOP.

MATTHEWS: One thing we have learned in this country, thank God, in
our self-governing democracy, and it is that, there are checks on power.
And in this country, the demagoguery is not a good career plan. It`s a
great plan for a couple weeks or months, Joan.

It works, like a Roman candle.

WALSH: Right.

MATTHEWS: We all stare at it, but we know it ain`t going to live
long. The heat level this guy`s at, I don`t think anybody left right or
center can sustain. His heat is in every direction. I don`t like my
fellow Republicans. I want to get rid of a lot of them. I want the
attention right now. I want to destroy Obamacare. I want to bring down
the government. I want to risk everything.

How long can you pursue -- what do you do the next year after the
first year like this? This is his first year.

(CROSSTALK)

MATTHEWS: What`s the second act look like?

WALSH: Let me contradict myself briefly. I don`t think he will get
the nomination, he could, because there is that hatred afoot in our
country. I`m sorry to say it, but there is. And there is that hatred of
government. And there are people -- people really -- far-right people
believe that they were pushed, they were sold a bill of goods, a moderate
in John McCain, a moderate in Mitt Romney, and that this time is their
time. 2016, it is their turn.

And he`s popular in Iowa. He really -- I don`t think this is going to
happen, but it could happen, because he really is giving voice to a very
nihilistic, very angry, anti-government, out-of-touch sector of our
society.

And we don`t know how destructive they are or how many of them there
are, but they are the true believers. And he could go farther than we
think just on that.

MATTHEWS: Well, back to the McCarthy comparison, and no comparisons
are perfect, Jim. But it seemed like people didn`t like Joe McCarthy as
much as they didn`t like his enemies. They didn`t like people on the left,
the intellectuals, the pointy heads, whatever you called them back then.
They knew he had gone overboard, but they sort of didn`t like his enemies
so much, they were willing to put up with him.

Does this guys have anybody who loves him or just they like the fact
that he hates Obama?

MOORE: Well, he does have people who love him.

They believe -- his supporters are very, very serious people,
especially here in Texas.

WALSH: Yes.

MOORE: And they`re active -- active and they`re determined. And they
support him.

MATTHEWS: What do they believe in?

MOORE: What`s that?

MATTHEWS: What do they believe in?

MOORE: Oh, basically what I just said to you previously. They think
the government`s too big.

They think the government shouldn`t do anything. But the caveat on
this is always, we don`t like the government until we need the government,
until we need the government to bail out Wall Street, until we need the
government to mess in a woman`s right to choose.

(CROSSTALK)

WALSH: Right.

MATTHEWS: When we have problems when agriculture, when we have
droughts, when we have floods, when we have anything God made that`s real
and part of the history of this planet, it doesn`t come occasionally. It`s
there somewhere all the time. The very prospect of living on this planet
means there`s going to be things that happen you need help with.

Joan, I have learned -- we`re going to get to this in the rest of the
show, but I have learned in the last couple of days how much the Republican
Party when it comes down to it loves the federal government, whether it`s
the monuments to World War II, or it`s NIH.

WALSH: Right.

MATTHEWS: All the things they have spent their careers voting
against, they now say they want back big time because they`re threatened by
the -- or affected by the shutdown.

What do they really believe about government? I only like when it`s
there or I only like it when it`s not there or when I need it or what?

WALSH: Well, I am seeing in polls that people like it, so I have got
to position myself as looking some parts of it. And everybody loves
veterans. Obviously, we love veterans. So, certain parts of it are very
easy to embrace.

And then again, right, when there`s a flood or a tornado or a
hurricane, people like it too.

MATTHEWS: OK.

WALSH: But, you know, you asked what these people believe in. I
wanted to be mean and say secession.

I mean, there are these people who have been crusading against the
government going that far back.

MATTHEWS: I know.

WALSH: And Ted Cruz told us he wanted more Jesse Helmses in the
Senate, that we...

MATTHEWS: Well, let`s go back to something that`s a little short of
secession.

(LAUGHTER)

MATTHEWS: It seems like the biggest fear Ted Cruz has of Obamacare,
if you will, the Affordable Care Act, which is law of the land, is that it
will be liked.

WALSH: Right.

MATTHEWS: He said that in January.

Let me go back to Jim Moore on that.

That`s an amazing admission. He said his biggest fear or his fear is
that it will be like sugar, as he put it, that the Affordable Care Act will
be liked, people will become, as he put it, addicted to it. That`s another
way of saying they will -- they support it. But he says addicted because
it carries a reference there.

Well, is that his real fear, that government is getting bigger in some
cases because people want it to do certain things?

MOORE: Well, I believe, Chris, that it`s -- this is very much the
specter of Social Security, a law that the right and the Republican Party,
a lot of them did not want.

And there`s this fear now that the Democrats are going to give the
country something that the country believes in and uses. And the traffic
on health.gov is clear that there`s just an overwhelming interest in this
idea. And if the voters, if the electorate, if the population gets used to
this and it`s a value, they remember the party that gave it to them. And
it`s a threat to the Republican Party.

It`s the threat to the far right, which wants to dismantle programs of
this nature. That`s what he`s afraid of. And they will push the myth of
the welfare Cadillac on this, just like other programs.

MATTHEWS: What an amazing admission. I hope they don`t get what they
want, because they will want it and like it and they will know where they
got it from.

Thank you, Jim Moore, well-stated.

And, Joan, as always, thank you.

Up next: a way furloughed federal employees in Washington can vent
their frustrations in this very tough time. And this is HARDBALL, the
place for politics.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP, "THE TONIGHT SHOW WITH JAY LENO")

JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": Well, this came out
today. American adults scored below the national average on math, reading,
and problem solving skills.

Do we need a test to know that we`re not good at problem solving?
Can`t we look at these morons in Washington and the shutdown and figure
that out?

(CHEERING AND APPLAUSE)

LENO: Exactly. Exactly.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

MATTHEWS: Time for the "Sideshow."

That was of course Jay Leno echoing the frustrations familiar to so
many Americans right now. But the big surprise last night came later in
the show, when Ann Romney was preparing a meal from her new cookbook.

(BEGIN VIDEO CLIP, "THE TONIGHT SHOW WITH JAY LENO")

LENO: Let me ask you something.

(APPLAUSE)

LENO: So, when you make this, does Mitt come running?

ANN ROMNEY, WIFE OF MITT ROMNEY: He can smell it and no matter where
he is...

(CHEERING AND APPLAUSE)

LENO: Here we go.

How are you? Good to see you.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

MATTHEWS: What a regular guy, huh?

Anyway, be sure to catch "The Tonight Show" tonight. I`m going to be
on to talk about my book "Tip and the Gipper" about when politics -- well,
I was in politics, and it worked.

Next, many young people are probably familiar with the concept of
drunk dialing. But for those who aren`t, the phrase refers to the random
and unfiltered phone calls that people are prone to make while intoxicated.

Well, with thousands of furloughed employees taking to local D.C.
bars, there`s sure to be a lot of pent-up anger directed at Congress. And
now there`s a Web site that helps them let off some steam. Drunk Dial
Congress connects your call with the office of a random member of Congress,
so that you can give them a piece of your mind.

Here`s the message that plays before connecting frustrated callers to
Capitol Hill.

(BEGIN AUDIO CLIP)

UNIDENTIFIED MALE: Hi.

Is this government shutdown making you want to drink? Well, it sure
makes me want to drink. And let me tell you, when I drink, I like to tell
people what`s on my mind. So, in a minute, we`re going to forward you to a
member of the House of Representatives, and you can tell them what`s on
your mind and tell them to get back to work.

(END AUDIO CLIP)

MATTHEWS: Whatever you think of that, the site reports that they have
been transferring 1,000 calls an hour.

Up next: mad money. The business wing of the Republican Party is now
fighting the Tea Party monster it helped create.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

VERONICA DE LA CRUZ, MSNBC CORRESPONDENT: Hey there. I`m Veronica De
La Cruz. And here`s what`s happening.

He was the second American to orbit the Earth. Scott Carpenter, one
of the original Mercury Seven astronauts along with John Glenn, died of
complications from a stroke. He was 88.

Former Detroit Mayor Kwame Kilpatrick has been sentenced to 28 years
in prison. He was convicted earlier this year on corruption charges.

And the historic Ohio Clock in the Senate ticks no more, thanks to the
government shutdown. The curators that wind the 194-year-old clock have
been furloughed.

I`m Veronica De La Cruz -- now back to HARDBALL.

(BEGIN VIDEO CLIP)

JACK LEW, U.S. TREASURY SECRETARY: We have never been there, and I
think anyone who suggests they know exactly what that means would be
projecting after 224 years of the history of paying all of our bills what
happens if we stop paying all of our bills.

If Congress fails to meet its responsibility, it could deeply damage
financial markets, the ongoing economic recovery, and the jobs and savings
of millions of Americans.

(END VIDEO CLIP)

MATTHEWS: Welcome back to HARDBALL.

That was Treasury Secretary Jack Lew on Capitol Hill today taking on a
recent scourge of default deniers that have emerged in the GOP. These are
Republicans who are driven by the Tea Party obsession with destroying the
president`s standing, even if it means destroying the economy in the
process.

The Republican threat of economic catastrophe has unnerved, however,
conservative business groups across the country, including the powerful
Koch brothers and the U.S. Chamber of Commerce. The irony here is that the
GOP business lobby finds itself fighting against a right-wing insurgency it
helped create.

"The New York Times" reports today that -- quote -- "After the 2010
elections, the Chamber of Commerce and other business interests funneled
millions of dollars into Republican redistricting efforts around the
country, helping draw overwhelmingly safe Republican districts whose
occupants, many among the most conservative House members, are now far less
vulnerable to challenges from more moderate Republicans."

Well, like it or not, this is the House paid for. But money talks.
And already we`re seeing business groups funding new primary challengers to
take on Tea Party congressmen like Justin Amash and Kerry Bentivolio of
Michigan, Scott DesJarlais of Tennessee, and Walter Jones of North
Carolina.

Well, Nick Confessore is a reporter for "The New York Times," and
Kathleen Parker is a Pulitzer Prize-winning columnist for "The Washington
Post."

Thank you both for joining us.

This happens in politics. We have atomization all the time, where
groups that were once in bed together decide they`re not in bed in terms of
their final interests.

Nick, what happened here? It does seem to me the logic is clear in
what you point out in your reporting, that if you make a district very safe
a Republican, the only thing a Republican risks is somebody younger than
them perhaps and someone to their right, not necessarily someone to the
middle.

NICHOLAS CONFESSORE, "THE NEW YORK TIMES": That is correct.

I mean, after you have created these very safe districts, the tools
that you have, which are advocacy, campaign dollars, are less effective,
because they can`t really be moved. Their only real threat is from the
right. But, more importantly, I think, here, what`s interesting and what
has been revealed here is that the business lobby, which we think of as
kind of all-powerful in Washington, actually doesn`t have a lot of
influence over this particular faction of Tea Party conservatives.

The head of the National Federation of Businesses, the small business
lobby said to me yesterday, "These guys don`t care what I think."

That`s astonishing when you think of how closely intertwined the small
business world is with the GOP...

MATTHEWS: Yes.

CONFESSORE: ... how many interests in common they have.

And what I have heard from -- what I have heard from people is that,
for the business community, it`s been all carrot for a long time, but no
stick. And what`s missing here is stick from the business guys. And what
they`re saying now is, you know, it`s time for the stick.

MATTHEWS: You know, Kathleen, what always bugs me about political
reporting because it`s boring to me is every time you hear people talking
about an election a year off or two years off, they tell you how much money
they have in the bank. That`s supposed to decide the election.

It`s so boring. I guess it powerful when he does talk. But is it
possible that people on the hard right are getting small contributors to
help them. In the primary process, the real gungho zealots give money to
rich people, they`re more interested in keeping those people than the fat
cats who are going to help in general.

KATHLEEN PARKER, THE WASHINGTON POST: Right. Well, Chris, of course
money helps. It`s important, but it`s not everything. The most important
thing is the candidate every time. And in these districts that are being
challenged that are going to be primaried from the other side now, they`re
not -- you know, some of those are -- it all depends on the district. Some
of those are ultraconservative. It doesn`t matter how much money you throw
at them, they`re still going to put their incumbent back in office or keep
in office.

And, you know, the others that aren`t so hard right and conservative
may indeed face some serious challenges. But it really comes down mostly
to the candidate. And it has everything to do with the district itself and
the composition.

MATTHEWS: Well, talk about mad money, look at this. Since the
shutdown began not too many weeks ago, a week ago, business interests have
unleashed an unrelenting attack on Republicans, September 30, on the eve of
the shutdown. The Chamber of Commerce and 250 groups warned Congress of
the impact of the shutdown and default, October 2nd. Nineteen of the
country`s largest banks meet with the president, a Democrat, to discuss
economic catastrophe of a default, and prolong shutdown.

That same day, "The Wall Street Journal" editorial board issues a
scathing rebuke of the GOP kamikaze strategy. And later that week, on
October 6th, "The Washington Post" reported that business groups have began
funding challenges to Tea Party lawmaker, which brings us to yesterday,
when Koch industry, which is run by the conservative billionaire Koch
brothers, sent out a letter to Congress warning of the GOP`s Obamacare
tactics.

Also, yesterday, "The New York Times" reports that a coalition of
business lobbyists are revolting against the Tea Party, which brings us to
today, with Republicans unveiling a short term to raise the debt limit.

Let me ask you, Nicholas, can you report why the Koch brothers, who
don`t like any publicity it seems, but they want to have a lot of
influence, they`re out there saying, oh, we had nothing to do with tying
Obamacare to the government shutdown or to the debt when, in fact, we know
they`ve been fighting it like dogs to kill Obamacare any way they can.

What`s the truth here?

CONFESSORE: Well, no, Chris, that`s actually important distinction.
The Koch brothers and the political world around them, yes, they have
funded or helped fund I should say, some groups that favor this strategy.
But their own groups and they themselves do not think it`s the best
strategy. They`ve actually been pretty consistent for awhile. I think the
letter yesterday was an effort to say, look, we support getting rid of
Obamacare. This is not our strategy. We don`t agree with it. We have a
better strategy.

MATTHEWS: Well, let me go back to your larger point, didn`t they
support ALEC, this effort in every state legislature to go hard right on
things like voter requirements, voter suppression, if you will? Weren`t
they behind that as well?

CONFESSORE: Well, yes, they support all kinds of conservative causes.
But the Americans for Prosperity, and kind of Koch world strategy on
Obamacare is stop people from enrolling it and tell them it`s a bad deal,
warn them about rising insurance premiums, make the thing grind to a halt
and then elect people who can overturn it.

You know, the strategy of doing it through this kind of brinksmanship
is not one that some of these big funders really support.

MATTHEWS: Only 20 seconds here, Kathleen. How do you dichotomize the
power of money and big concerns, and honestly larger concerns perhaps on
the world market than the grassroots? How`s the Republicans reconcile both
points of view?

PARKER: Well, I think, you know, most of the debate within the party
itself if over tactics and as you all just described, a lot of the
Republicans in the party certainly had no intention of taking things to
this point. And what`s -- you know, I think at this stage, how do you get
the Tea Party to sit down and play along with the more established, more
conservative moderate parts of the party? And that has to do with will the
president and Speaker Boehner and the other Republican leaders, will they
be able to come up with some little bit of cover that allows these
Republicans, these Tea Partiers to say, we`ll see, we did get something for
all of our effort.

Now, the trick is, of course, to separate it so that the president
doesn`t have to say he negotiated. But everyone is looking for the fig
leaf, and I think everybody is ready to accept it.

MATTHEWS: Well, the president will negotiate. He says he will. He`s
just not giving up his baby. And the people went after him to get the baby
made a calculated error. They should have gone after debt, says it has to
do with the debt ceiling and kept away from his legislative achievement
which they have got to accept.

Anyway, that`s my view. Maybe not yours, Kathleen, but I love having
you on the show.

Nicholas Confessore, Kathleen Parker, thanks for joining us.

Up next, for all their anti-government talk, it seems Republicans like
a lot of things the government does, like every one of them they like.
NIH, monuments, all kinds of things as these things go on.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: New polling in that hot governor`s race in Virginia. Let`s
check the HARDBALL scoreboard.

According to a new Quinnipiac poll, Terry McAuliffe`s lead over
Republican Ken Cuccinelli is growing. It`s up to 8 points in the latest
poll: McAuliffe: 47, Cuccinelli: 39, and the libertarian in the race: 8.

We`ll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. KIRSTEN GILLIBRAND (D), NEW YORK: You don`t pick and choose the
parts of government you like. Government is supposed to function on behalf
of the people. The people of the United States need a functioning
government. And members of Congress shouldn`t say, well, today I like NIH,
but tomorrow, I might not. That`s not how government works. It`s a
gimmick and it`s one that should be soundly disagreed with.

(END VDIEO CLIP)

MATTHES: We`re back.

That was Senator Kirsten Gillibrand from New York, last week
chastising Republicans for trying to pass piecemeal budgets to fund the
government piece at a time. Democrats are opposed to paying for government
one slice at a time and instead want the entire government to reopen at
once and all of it. Nearly half a million federal workers right now remain
furloughed without getting paid. National parks are closed and veterans
may soon be without their benefits.

But now, the same Republicans who shut down the government and often
rail against it have decided that what some of government does just fine
with them.

Take a look at all the government they want to start paying for right
now. The military, veterans, national parks, Head Start, women and
children living in poverty, National Institutes of Health, air travel, air
travel safety, food safety. Imagine that, it`s rich irony, isn`t it,
coming from the party that hates government, wants to shrink and it
constantly advocates for budget cuts to the same programs they`re now, like
with crocodile tears, accusing the Democrats of being against.

Well, joining me right now is Jonathan Allen of "Politico", and Lizz
Winsted, co-creator of "The Daily Show."

Thank you both for joining us.

Jonathan, does the -- does the raw gnaw of irony ever cross the
bellies of these Republicans, as these do these horrific claims of horror
at the closing of a government they never liked in the first place? I
don`t even know how to find the right metaphor for this. It`s a hard one.

JONATHAN ALLEN, POLITICO: There`s no shame in politics, Chris, as you
well know. Frequently, members of Congress go out and rail against
something, only to be supporting it in private or vice versa. This is no
different here.

Look, do I think the Republicans really believe in funding veterans
and cancer research and those things? Absolutely. But, you know, I think
this is a little bit of a case of them, you know, of them making politics
out of something that clearly the Democrats support.

MATTHEWS: You know, Lizz, there was a great line from Reagan back in
the old days, where he said -- I`m sorry, Charlie Wilson. Remember Texas
Charlie Wilson, "Charlie Wilson`s War". Charlie Wilson, he said, I hope
Reagan doesn`t come out against sex. He talked it differently, because,
you know, it`s interesting how these people get into these things and then,
hey, this affects me. I never thought of that, you know?

These things -- this stuff I`m saying, this B.S. I`m spewing every
night -- hey, it has a reality to it. We do like the memorials, we do like
the National Institutes of Health, people do get cancer, they have to be
dealt -- we need the research, we need Meals on Wheels, Head Start. These
are good programs. And my people back home who say they hate government
are pounding me for this shutdown.

LIZZ WINSTEAD, CO-CREATER, "THE DAILY SHOW": Well, it shouldn`t
surprise anybody that these people don`t understand how the political
system even works. Half of them don`t even understand how a woman`s
reproductive system works, if you look at the things they try to legislate
on that front.

And so, I really think you hit it on the head, Chris. They don`t
understand the stuff that they enjoy. And now it`s dawning on them that
this might be a bad idea.

MATTHEWS: Well, I think, is there going to be any lesson learned
here, Jon? Or is this just one of those things that goes -- we have to
keep two conflicting ideas at the same time. One, we hate government.
Two, we don`t hate government. Is this just going to pass two weeks from
now, or I`m sorry, probably two months from now, around Thanksgiving time,
the Republicans will go back to blowing their horns against government,
after having begged to have to come back.

ALLEN: I think they`ll go back to blowing their horns against
government. Let`s remember that the spending levels right now, Democrats
would argue, got important programs, including some of those Republicans
are saying right now, that they support so much and are accusing the
Democrats of not supporting by passing these pills on the House floor. The
president, of course, has said it`s a bad idea to start taking a piecemeal
approach to government.

Republicans support what they call zero baseline budgeting, where you
would create funding for each program, each year. Democrats think that`s a
losing proposition. Well, I don`t understand why they would ever try to do
it this way.

So, again, I think it won`t be long before you hear Republicans
bashing government again.

MATTHEWS: Let me go back to Lizz. You know, they say they like
defense, Republicans tend to be, as a group, a bit more hawkish than
Democrats, but not in terms of supporting the military. Both parties are
whatever they are, but they`re not particularly ideological about veterans
benefits and things like that.

But along come the Republicans. It seems like they wrote that bill,
shutting down the government, they wrote the exceptions. They never made
the exceptions for what happens if you get killed in war, which is part of
war. It happens. It`s one of the statistical realities of war, which we
all hate, but it`s there.

And they never allowed for the fact that some of our good G.I.s, they
are risking their life for this country and its values, including
democracy, aren`t going to make it back. And apparently according to the
expert, the comptroller, they knew it when they did it that they were
secluding the death benefits, the $100 k that goes to the family, that pay
for the funeral and travel and everything else, they knew they were kissing
good-bye to that and they did it. I don`t even get that part.

WINSTEAD: Well, I don`t get, really, any of it, when they talk about
that there`s been no compromise, because this clean C.R. they keep talking
about is sequester-level cuts. And so, I feel like they don`t know
anything they`ve cut. And they haven`t paid attention. And you have a
whole bunch of people who try to fool the American people by saying, you
know, the president hasn`t compromised at all, when the C.R. they want to
pass is practically as austere as the Ryan budget itself.

MATTEHWS: Liz, by the way, I get a chance to say this on the air.
You writers on "The Daily Show" are geniuses, OK, and "The Colbert Report."
I laugh my butt off listening to you guys.

Thank you so much, Lizz, who knows what`s funny and what isn`t.

And, Jonathan Allen who knows what`s true.

We`ll be right back after this.

(COMMERCIAL BREAK)

MATTHEWS: Let me finish tonight with this:

One thing I`ve discovered, with all this hell on earth for the last
couple of weeks, it`s given people a healthy American attitude for better
politics, even if it`s a memory of better politics. "Tip and The Gipper:
When Politics Worked", and the real-life deal making of liberals Speaker of
the House Tip O`Neill, and conservative President Ronald Reagan will appear
next week on "The New York Times" best seller list.

What does it tell you? It tells you this country is still a hopeful
country, still a fair country, and knows that if we keep going in the
direction we`re going in right now, with four out of five Americans saying
it`s the wrong direction, we`re in for even worse trouble.

Let`s face the fact, either we learn to make self-government work or
we lose the one great asset this country has, the ability to sort things
out between right and left, between Democrat and Republican, and right now,
between Congress and the presidency. That`s the real deal we need to get
back to, not these 11th hour Mickey Mouse operations we`re into right now.
Don`t you think?

That`s HARDBALL for now. Thanks for being with us. Catch me tonight
on "The Tonight Show with Jay Leno."

"ALL IN WITH CHRIS HAYES" starts right now.

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

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