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updated 10/25/2013 10:42:25 AM ET 2013-10-25T14:42:25

HARDBALL
October 24, 2013
Guest: Jon Favreau, John Feehery, Willie Brown, Jennifer Granholm, Frank
Pallone, Richard Moe

CHRIS MATTHEWS, HOST: Who`s being mean to Ted Cruz?

Let`s play HARDBALL.

Good evening. I`m Chris Matthews in Washington.

"Let Me Get Started" tonight with this emerging war in the Republican
Party, the insurgent Confederate party of Ted Cruz and the Northern
mainstream party personified by Chris Christie.

When you look at Cruz, you can see the insurgent right in all its
indignant victimhood. He complains of the Washington establishment being
mean to him, as if he were an 8-year-old in the recess yard. Like others
who`ve offered themselves up as populist leaders, he presents himself as
the one who`s been wronged. He speaks of challenging the bosses, even
though they`re his party`s elected leaders and he or any other Republican
senator is free to run against them. He speaks of folks saying mean things
about him as if he wasn`t the one that brought the government to a shutdown
and nearly over the fiscal cliff.

But who are the people who rally to the Texas senator, believing what
is so obviously not true, that he`s the innocent, he`s the casual bystander
in this war, when he, Ted Cruz, is the very figure who fired on Ft. Sumter,
not the other way around. Or is the right so dizzy in its anger right now
that it can`t get -- it can`t tell up from down or north from south or
victim from troublemaker.

Jon Favreau was a speech writer for President Obama. He`s now a
columnist with the DailyBeast. And John Feehery`s a Republican strategist.

Gentlemen, I want to go inside with you, sir, in the Republican Party
because you really know it. It`s your home turf.

JOHN FEEHERY, REPUBLICAN STRATEGIST: Absolutely.

MATTHEWS: It`s an interesting party because it`s made up of the party
we grew up with, moderate to conservative, Barry Goldwater all the way over
the other way to maybe John Lindsey (ph), if you want to include everybody.
Now it has a new wing. Who`s winning?

FEEHERY: Well, I think the establishment wing, if you want to say it,
is not winning. They are taking on some more water. They`ve got to fight
back in the primaries. They`ve got to be able to make these members honest
so they don`t keep on going to the right. The most important thing for the
Republican Party...

MATTHEWS: Why was everybody afraid to challenge the hard right during
the government shutdown in the last two weeks, so afraid that they stayed
in line, stayed in line until they got the permission slip from the
speaker, It`s OK now to vote the way you think?

FEEHERY: Well, they were worried about a primary. And you know, most
members are risk-adverse. They would rather not have a primary. And
they`re also worried about -- there`s a populism going on in the country,
not just with the Republicans but also with the Democrats. There`s a
disgust with Washington. There`s a disgust with New York, the Acela
corridor. And I understand that, and Republicans...

(CROSSTALK)

MATTHEWS: ... New York problem, the old one?

FEEHERY: It`s Wall Street.

MATTHEWS: Wall Street.

(CROSSTALK)

MATTHEWS: ... Andy Jackson attitude, yes.

FEEHERY: Absolutely. There`s this big disparity in wealth between
the Acela corridor and the rest of the country, and people are frustrated.
They`re frustrated with where the country is going. And we appreciate
that...

MATTHEWS: Have you looked out the window on the Acela and seen all
that poverty out there driving through north Philly? It`s not all rich up
there.

FEEHERY: Well, I know, it`s not all rich, but you get my point, and
the sense that there`s this populism out there. Republicans have to
understand that. But they have to channel it into a governing philosophy,
and being against everything, being that nihilistic is no way to govern.

MATTHEWS: You see nihilistic the way I do. Do you say it that way?

(CROSSTALK)

MATTHEWS: Is this generational or...

(CROSSTALK)

MATTHEWS: ... properly schooled?

(LAUGHTER)

(CROSSTALK)

MATTHEWS: I know, but (INAUDIBLE) high school when you learn how to
speak.

Let`s talk about this, though. Jon, you`ve been writing for the
president. You`re a loyalist to the president, right? Put your cards on
the table.

JON FAVREAU, FORMER OBAMA SPEECH WRITER: I am.

MATTHEWS: He`s looking out from the White House right now, and sees
the other party if not in -- they`re not in disarray. Republicans are an
organized group of people. But there is an unusual division going on,
where you can actually see across the Mason-Dixon line, it`s almost -- the
South is very much insurgent right now.

FAVREAU: Yes, I mean, I think -- you know, and I said this in my
column. I think we have to be on the side of the moderates because I think
if the president wants to be working with John Boehner, he has to make sure
that when he makes a deal with John Boehner, that he`s going to have some
Republicans come along with him and he`s not going to have a bunch of
people...

MATTHEWS: Have you seen him do a good job of that? Is he doing a
good job of sitting down with John Boehner in private, keeping the
conversation secret, working together, trying to peel them away from the
right wing? Do you think he`s done a good job of that?

FAVREAU: I think the two men get along really well.

MATTHEWS: Has he done a good job of that?

FAVREAU: Yes, of course he has.

MATTHEWS: How come every time something is said at the White House
like, I can`t stand looking at you, or, They overran me, it leaks within
hours?

FAVREAU: Because that`s Washington.

(CROSSTALK)

FEEHERY: In all due respect to Jon, I think that the president would
like to see the Republicans go over the edge. And I think he eggs them on
because he wants the Democrats to take over the control of the House and
have the whole run of the thing in the last two years of his presidency. I
think that that`s a mistake. I think...

MATTHEWS: You think he`s thought that far ahead?

FEEHERY: I think he has, yes, and I...

MATTHEWS: I think sometimes, he`s playing for survival.

Anyway, the Republican Party`s conflicted about how much focus it
should place on social issues -- this is an old question -- abortion, gay
marriage, opposition to both. Well, after the election, the RNC put out an
autopsy, as we know -- this is after last year -- arguing it needs to be
more welcoming and inclusive on issues like marriage equality.

But a new report out today from a social conservative group blamed the
party`s losses last year on the fact that too many Republicans called a
truce on those issues. Quote, "We believe the conventional explanation
emerging from the Republican National Committee`s autopsy report gets the
core issues exactly wrong. Social issues, especially the life issues, do
not hurt GOP candidates, they help them win elections."

The group also faulted the party`s economic message as focused too
much on job creators -- in other words, business leaders, not regular
people who have to get a job.

Do you agree with that? Which is right?

FEEHERY: There was a lot of good stuff in that report. I think we
are the pro-life party...

MATTHEWS: The new report.

FEEHERY: The new report. A lot -- we are the pro-life party. And I
think that on economics, we can`t be the boss party. We got to be the
worker party. We got to be the worker bees because there`s a lot more
worker bees than bosses...

MATTHEWS: So you`re with -- you`re with Rick Santorum.

FEEHERY: I think he -- I think...

MATTHEWS: No, that`s the Santorum argument.

FEEHERY: ... Mike Huckabee had been right on this, that there is an
economic populism and we have to understand it and we have to come up with
a philosophy that`s not just free market unbridled, let the rich be richer,
let the poor be poorer, that we have to understand that there is a place
for helping people. And I think Santorum was right on that.

MATTHEWS: The sophisticated liberal will always tell you, On social
issues, I`m liberal, but on the fiscal issues I`m rather conservative. But
you`re saying that the real angle is probably the other way, looking out
for the working class guy, like Santorum, and also being culturally
conservative on issues like abortion and same-sex marriage. Do you agree
with that? Where`s the action?

FAVREAU: I...

MATTHEWS: Where`s the emerging majority in the country?

FAVREAU: I agree with John that the economic stuff they had in that
report was much more compelling. I mean, look, they`re not going to run
away from their position on social issues...

MATTHEWS: How about other social issues?

(CROSSTALK)

MATTHEWS: Do they stick to their guns?

FAVREAU: I think they can`t run away from their position on social
issues. I think they have to run away from candidates like Todd Akin,
who`s talking about legitimate rape. That`s what they have to run away
from on social issues.

(CROSSTALK)

FAVREAU: On economic issues, there are legitimate concerns about
income inequality and wage differential and job security. And you know, I
mean, one of the things in the report -- $5,000 scholarship for community
college, like the Democrats...

MATTHEWS: Can a Republican win the presidency next time -- forget if
it`s Hillary or not, forget the names -- if he or she runs on the platform
of hostility to legal abortion, hostility to same-sex marriage? Can they
win...

FAVREAU: No.

MATTHEWS: Well, you just said they could.

FAVREAU: Not national.

MATTHEWS: You just said they can`t run away from their positions.

FAVREAU: I think they can`t. I don`t think it`s the deciding issue,
but I...

MATTHEWS: Wait a minute. Let`s get it straight. Do you believe
they`re going to keep that in their platform?

FAVREAU: I think it depends on their economic issue.

MATTHEWS: No, their platform. Should they keep the cultural...

FAVREAU: Yes, they`re going to keep it in their platform.

MATTHEWS: But you said they can`t win if they have them in their
platform.

FAVREAU: I think that they- I think that they can`t run away from the
issues, but I think that...

MATTHEWS: Can they win on it?

FAVREAU: I think voters decide on economic issues.

FEEHERY: Listen, listen, George Bush...

FAVREAU: Voters will decide on pocketbook issues...

(CROSSTALK)

MATTHEWS: So it doesn`t matter if they keep them.

FAVREAU: No, it doesn`t matter.

FEEHERY: George Bush won on that platform. The fact of the matter
is, is you can`t run away on the pro-life thing, but you also can`t scare
people, like, you know, Cuccinelli on contraception. I mean, we have to
have a thing -- and there`s consensus on abortion...

MATTHEWS: You mean those -- you mean those -- you mean those -- what
do you call them, unmarried women in northern Virginia came to Washington
to work might be a little cared off by somebody who wants to outlaw birth
control?

FEEHERY: You need to focus on the issues at hand...

MATTHEWS: OK, just -- I`m teasing here because of this absurdity,
anyway. (INAUDIBLE) former congressman Steve LaTourette of Ohio is heading
up a new super-PAC called Defending Main Street that is actually trying to
take on the Tea Party and promote moderate Republican candidates next year.

He told "The National Journal," quote, "Hopefully, we`ll go into eight
to ten races and beat the snot out of them." Boy, he`s tough! "We`re
going to be very aggressive. We`re going to get in their faces."

Well, when you say you`re going to knock the snot out of somebody,
you`re already pulling your punches, it seems to me. We don`t usually talk
like that, Jon, do we, in speech writing, I`m going to knock the snot out
of that guy! He`s a little rougher...

FAVREAU: Stay away from that.

MATTHEWS: ... a little rougher. Do you think that`s going to work,
from your view?

FAVREAU: I hope so. I hope...

(CROSSTALK)

MATTHEWS: ... take on the hard right?

FAVREAU: I hope for the sake of the country it works because, you
know, we can`t afford to see what we did the last couple weeks.

FEEHERY: Listen, what you need to have are Republicans who believe in
governance. I don`t think that having the big business sector coming in
and saying that, This is our candidate -- but you need to fund the
candidates who are -- believe in rational governance and come up with a
strategy to do that.

If -- and the other thing about some of these candidates, these Ron
Paul candidates -- you know, I like Rand Paul, but Ron Paul is going
through this libertarianism that is just not Republicanism. And I think
that we need to find those business candidates who can rationally can make
the case for governance.

MATTHEWS: Well, here`s one guy that thinks it`s going to be hard to
take on the hard right. His name is Rob Jezmer (ph). He`s the former
executive director of the National Republican Senatorial Committee. He
said, quote, "This conflict could be the new normal. Until we have a
nominee people can rally around in 2016, I think we`re going to be in the
wilderness for a while."

Now, here`s my sense, both of you. I think he`s smart, this guy. I
don`t know him, but he`s a staff guy, like we used to be.

FAVREAU: Right.

MATTHEWS: He says, basically, that until the Republican Party goes
head to head in their day of reckoning, when they pick the candidate to run
against Hillary, probably, that`s when we`ll know whether it`s going to be
a party of the hard right a la Ted Cruz or back to the more center-right.
Do you agree with him?

FEEHERY: There is no single dominant strain of conservatism. It`s
all regional. It`s all based on, you know, your own beliefs. And until
there`s a presidential candidate that sorts it all out and we get behind
somebody, we`re going to have this conflict. I think Jezmer`s exactly
right.

MATTHEWS: Don`t you fear that -- as a Republican, that you might go
into the field in 2016 in an election you guys ought to be competitive in -
- because no party holds the White House more than eight years easily.
It`s always a struggle. And you find yourself with the middle taken away
from you because Hillary Clinton has moved to the center, where she sort of
is already on foreign policy, and you guys are stuck with a hard-right
candidate like Rand Paul or even Ted Cruz?

FEEHERY: I don`t know we`re going to have a hard-right candidate. I
think we`re going to have a governor. I think it`s going to be someone
who`s actually rationally governed, someone who actually has made hard
decisions and can understand how this all works together. And I think...

FAVREAU: Scott Walker you`re talking about?

FEEHERY: Well, I`m thinking of John Kasich. I think if you`re going
to...

MATTHEWS: Really?

FEEHERY: I like John Kasich.

MATTHEWS: Well, I do, too, but I don`t think he`s in the running for
the presidency.

FEEHERY: But you know, this debate is not unhealthy because there is
this shift in the country. The whole idea of free market unbridled
capitalism is not as popular as...

MATTHEWS: OK. Well, here`s another moderate Republican, a friend of
mind, Tom Ridge. The former Republican governor of Pennsylvania addressed
the Log Cabin Republicans, the group made up of gay Republicans, last
night. And he had a stark warning for his party.

Here he is. "For many observers, the GOP has become intolerant,
judgmental and self-righteous, perhaps worthy of the attitudes of the
pilgrims in 1620, but hardly attractive qualities for a political party
nearly 400 years later. Sadly, there`s very little room -- there is very
little room or respect for differences of opinion on social issues."

Is the Democratic Party lucky, fortunate in having as its opposite, a
party which is basically outmoded in terms of social issues?

FAVREAU: I think outmoded in social issues makes them lucky, but also
the fact that they`re outmoded in economic issues right now. I mean, we
were talking about the economic argument in 2012 was what sank the
Republican Party.

MATTHEWS: The 47 percent thing.

FAVREAU: Yes, the 47 percent and the idea of, you know, jobs
creators...

MATTHEWS: Well, Mitt Romney looked like an elitist. Let`s face it...

FAVREAU: That helped.

MATTHEWS: ... said, I`ve made money.

FAVREAU: That helped, as well.

MATTHEWS: And you`ll never make as much.

FEEHERY: Mitt Romney was the richest candidate we`ve ever put forward
in history. And rich people are actually very unpopular. So it was not --
it was not good...

MATTHEWS: That was odd for your party because the Democratic Party
has always been the party of the very high, the Roosevelts, the Kennedys,
the Stevenson, people like that, and the working guy. And you`re party`s
always been the party -- that`s your party. I`m sorry, your party`s
supposed to be the party of the bourgeoisie, the middle.

FEEHERY: And this was why I think -- I think Jon`s right. That`s why
we lost. It was on economic issues. And you know, people didn`t
necessarily trust Romney on social issues. The hard-core conservatives
didn`t really like Romney, and they didn`t come out to vote for him because
he was equivocal on abortion.

MATTHEWS: How`s the president doing?

FAVREAU: He`s great.

MATTHEWS: Is he happy?

FAVREAU: He is happy.

MATTHEWS: Is he?

FAVREAU: He is.

MATTHEWS: Is he happy?

FAVREAU: He`s realistic about what he has to do.

MATTHEWS: What`s the biggest thing he wants to do before he leaves
office?

FAVREAU: I think he wants to get immigration reform done, and
there`s, you know, a bipartisan bill that passed the Senate. I think he
should get it done.

MATTHEWS: Really?

FAVREAU: We`ll see.

(CROSSTALK)

MATTHEWS: Will he get immigration reform through?

FAVREAU: I certainly hope so. I think there`s a good chance.

FEEHERY: The less he talks about immigration reform, the better the
chance we get to get it passed.

MATTHEWS: (INAUDIBLE) completely -- I think it`s going to be a
congressional fight and it`s going to be closely run. And they better be
enforcing. They better be in a mood to enforce because if they do another
Simpson-Mazzoli, I`ll be against it.

Thank you -- I will. I`m not for another joke. We pass a law, we got
to believe in it, believe it`s progressive, and be proud to enforce it, or
don`t put your name on it and don`t vote for it.

Thank you, John Feehery. Thank you, Jon Favreau.

Coming up: Republicans in Texas are shifting hard to the right to copy
their new idol, Ted Cruz. They`re calling for impeachment, no direct
popular election of senators anymore, they want the state -- state
legislatures to own them, and even expulsion of major blue states from the
union. And you can be sure that Cruz doesn`t want what happens in Texas to
stay in Texas. This guy`s going national. He`s going up to Iowa this
week. Guess why?

Plus, want to know why Republicans are fighting so hard to kill the
Affordable Care Act? They were wrong on Social Security, wrong on
Medicare. If they`re wrong on the president`s health care program and it
succeeds, where are they going to be? They fear losing another generation
of voters.

And Jay Leno takes a shot at HHS secretary Sebelius.

Finally, "Let Me Finish" with how I got here -- from the Peace Corps.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Well, the plot thickens about that unnamed Republican House
leader who reportedly told President Obama, quote, "I cannot even stand to
look at you." Well, the HuffingtonPost is reporting that it was Texas
congressman Pete Sessions, but the White House says it never happened and
the episode was a misunderstanding.

Well, the story first came to light when Senator Dick Durbin of
Illinois cited an unnamed Republican House leader who insulted the
president at a White House meeting. Well, the HuffingtonPost says now
Senate Majority Leader Harry Reid revealed it was Sessions, the chairman of
the Rules Committee, in a private meeting last week with Democratic
senators.

Well, Sessions denies having said it. Wouldn`t he? And the White
House today released a statement today saying the president, quote
(INAUDIBLE) and the quote`s not accurate and there was a miscommunication
about what (ph) meeting that (ph) meeting when they were briefed by Senate
-- well, we`ll see. As I said, the plot thickens.

We`ll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. TED CRUZ (R), TEXAS: I`ve spent the past month in Washington,
D.C., and it is terrific to be back in America!

(CHEERS AND APPLAUSE)

(END VIDEO CLIP)

MATTHEWS: What a cheap shot that was. Welcome back to HARDBALL. Ted
Cruz came home to a hero`s welcome in Texas, as you saw last week. The
only thing he achieved in Washington, however, was to become the leader of
a failed strategy that left his party with plunging poll numbers, as we
know, and its House majority actually in peril next year.

Nonetheless, Cruz took a victory lap around the Lone Star State, where
he was greeted with welcome home rallies and a series of public appearances
surrounded by cheering audiences for, as one supporter said, going to the
mats.

Well, under Cruz`s influence, Republicans in Texas are lurching
further and further to the right to win primaries and making dramatic
appeals to do it, calling for the impeachment of President Obama, proposing
that states like New York and California secede from the union, calling for
a rollback of the 17th Amendment that allows for popular election of U.S.
senators and opposing benefits for illegal immigrants, as well as anti-
discrimination laws.

Well, if successful, could Cruz`s influence expand to the Republican
Party nationally, and moreso, could we see an attempt to replicate this
strategy and do to America what he`s done to Texas?
`
Willie Brown is mayor of -- was mayor of San Francisco, and Joan Walsh is
editor at Salon and an MSNBC political analyst .

Let me go to the mayor, who always sharpens the issue. Mayor Brown,
this -- this "Cruzism," if you will, is a different strain than what we`ve
seen. This fellow has declared war on Washington, which he considers
foreign territory. People around him consider California now foreign
territory. They`re talking about getting your state out of the union,
getting New York out of the union.

I realize this is rhetoric, but what does it mean actually to the
people who are cheering it?

WILLIE BROWN (D), FMR. SAN FRANCISCO MAYOR: He`s trying desperately
to get the nomination of the Republican Party for 2016. He apparently
believes that he needs to be as radical as he possibly can be with that
collection of people that have been his traditional supporters. And he
hopes to somehow marshal Texas in that vein.

This is a guy, Chris, who is incredibly smart, by his own assessment.
He ran into, however, equally smart people on the floor of the Senate and
in the House in this last struggle. But he`s come away making his people
think that, in fact, that collection of people did not know what they were
doing and what they`re talking about. And for him, it`s working. He`s
getting more contributions and more attention than he`s ever gotten in his
life.

MATTHEWS: Do you think he loves Texas even moreso far the reason you
left it?

(LAUGHTER)

BROWN: I think his love affair with Texas is a love of convenience,
nothing else.

MATTHEWS: Yes. Let me go to Joan on this. You`re also a
Californian, from the northern part of the state. And it is unusual
because Barry Goldwater got in big trouble -- and he was not a bad person,
he was just a man of the -- of the frontier West who was a total
libertarian.

He got into trouble for getting (ph) in the face of scariness to his
party by being the guy who was -- by saying, I want the generals in the
field to decide when to use nuclear weapons or not. And they went, Oh, my
God, he`s giving the military the decision, giving them the black bag, the
football? They decide when to go to nuclear war? That`s what killed him,
I think, killed him with the country.

Right now, we have a guy who`s almost as explosive in terms of
bringing down the government, bringing down our national debt. Let`s go
default. Anything goes in my lexicon of weapons.

JOAN WALSH, SALON.COM, MSNBC POLITICAL ANALYST: Well, and I think,
you know, if he ever got the Republican nomination, Chris, he would lead to
the same outcome that the Republicans suffered in 1964. It would be a
profound drubbing. But the danger here, it`s interesting, because a lot of
us blue state people from California or New York, sometimes, we turn up our
noses at Texas. And sometimes we say, oh, they`re a bunch of crackpots.
Let them secede. And, yes, they have their secessionists. They have their
McCarthyites. They have got their crazies. But Texas is really a
microcosm of the United States.

(CROSSTALK)

MATTHEWS: It is?

WALSH: Yes, it is. It`s absolutely is. The America that is
struggling to be born is also being born in Texas.

(CROSSTALK)

MATTHEWS: Oh, I see, demographically. Sure.

WALSH: Demographically.

MATTHEWS: But not politically.

(CROSSTALK)

WALSH: Demographically, and in the cities politically. And there`s a
rising power of Latinos.

If we had the Latino population of Texas voting in the numbers that
they do vote in California and New York, Texas would be more purple. Texas
is a purple state. We just can`t quite see it yet. And you`re going to
have the candidacy of Wendy Davis creating this great alliance between
Latinos, women, young people.

It may not be enough to do it, but Ted Cruz is taking Texas, as well
as the country on a course of demographic suicide.

MATTHEWS: Yes. Well...

WALSH: It feels good. It feels good to those people who are
terrified of what the country is becoming. But it`s not going to be good
for them in the long run.

MATTHEWS: Well, I remember what General Custer said to Cochise right
before the Battle of the Little Big Horn. He said some day we`re going to
outnumber you, and he said, yes, but not today.

OK, not today.

WALSH: Not today.

(CROSSTALK)

MATTHEWS: And right now here`s what`s going on in Texas right now.
Republicans running for office in Texas are vying to be the most Cruz-like
and are making dramatic appeals to get the furthest to the right in
Republican primaries.

All four major GOP lieutenant governor candidates support repeal of
the state`s landmark 2001 law offering in-state college tuition to illegal
immigrants supported by Rick Perry back then. Well, Lieutenant Governor
David Dewhurst, whom Cruz defeated in that primary, said that Obama should
be impeached not only for trampling as he says on our liberties, but what
he did in Benghazi. It`s just a crime.

Three candidates for attorney general oppose a nondiscrimination
ordinance in San Antonio that includes protections for sexual orientation
and gender identity. Well, Lieutenant Governor Dewhurst and one of his
challengers both support repealing -- catch this -- repealing the 17th
Amendment that called for popular election of senators. They want them
tied to the legislatures.

And one of Dewhurst`s opponents wants to expel -- catch this -- the
liberal states of New York, California, Massachusetts and Connecticut.
Jerry Patterson said -- quote -- "Just think about how different our
country would be if New York and California weren`t the tail wagging the
dog and those other states. It`s not America."

Again, Mayor, going back to the use of the term America. It seems
that in the lexicon of these people to mean white conservatives. I mean,
that may be a -- too broad a definition. There`s probably a narrower
definition. How about white right-wingers? But they call that America.
It`s almost like one of those Afrikaner groups in South Africa that says
we`re going to put the, you know, the big logger around us and form a
little town somewhere in Bloemfontein.

(LAUGHTER)

MATTHEWS: These guys are unbelievable. Go ahead, Mayor. I`m sure
you have an attitude about these guys.

BROWN: Well, they really are.

But let me tell you, Chris. One of the odd things about Mr. Cruz is
nobody has said a word about the fact that he was born in Canada. Can you
imagine the conversation that will ultimately take place in the Republican
world when they find out?

MATTHEWS: Well, they must know.

(CROSSTALK)

JEFFREY BROWN: Oh, sure. In the Republican world, they will have a
conversation on that issue.

(CROSSTALK)

MATTHEWS: And he`s Latino, too. The other part of him is, he`s
Latino. His name is Rafael Edward Cruz, which normally might be a wait a
minute here kind of thing with the Republicans. But, no, that doesn`t
bother them.

I think they make exceptions for their point of view politically.

WALSH: Yes, I do too.

MATTHEWS: I think they do.

I think they`re quite willing to accept anybody`s papers. I think he
is a natural-born American because he was born to an American mother.

(CROSSTALK)

WALSH: Yes. I wish we were going to see some integrity -- not that I
wish -- you know, I we as Democrats are open to the broadest spectrum of
people participating. I`m not going to become a birther about Ted Cruz,
but if you had a little bit of intellectual and political consistency on
the other side, there would be paranoia about this guy born in Texas --
excuse me -- born in Canada.

There`s not going to be that because they don`t have that kind of
intellectual or political consistency or integrity.

(CROSSTALK)

MATTHEWS: I`m all for his background. I think it`s a great American
background, by the way.

(CROSSTALK)

WALSH: Yes, it`s a great American story.

MATTHEWS: Cuban-Irish. It`s great.

WALSH: Cuban-Irish.

MATTHEWS: I think it would probably be pretty much fun, actually, a
group of people like that getting together.

(CROSSTALK)

MATTHEWS: Anyway, Mr. Mayor, you think they`re going to jump on this
guy because of his -- but you think they will jump on him out of the reason
when they -- went they suspect or want to suspect the president was born in
Kenya for some bizarre notion of history and conspiracy, that once they
find out that he is in the worst-case scenario, that they will jump him.
Do you think they`re that consistent?

BROWN: I think the Republican Party is capable, literally, of having
membership on every side of any issue on any given day.

(LAUGHTER)

BROWN: And, believe me, I think when the fight really starts for that
nomination, there`s going to be somebody among the Republicans who are
going to call him to task.

MATTHEWS: Yes.

BROWN: And they`re going to ask about all the things that are
inconsistent with really good judgment.

They`re going to ask, why is it you wouldn`t study when you were in
law school with people who didn`t graduate undergrad from Harvard or Yale
or one of those places? How is it that you come off as being so superior
to everybody else? That dialogue is going to take place. And just as it
did in the Congress, Cruz is not going to be able to handle it.

(CROSSTALK)

MATTHEWS: What do you think though -- what do you think that New York
City immigration officer, I think his name is Donald Trump, who checks
everybody`s papers -- do you think he will have a consistent view when he
emerges with an opinion on Ted Cruz?

(CROSSTALK)

WALSH: Absolutely sure. I`m sure he`s got his researchers, his guys
are up in Canada right now looking for the real birth certificate. Of
course not.

MATTHEWS: You`re being sarcastic.

(LAUGHTER)

WALSH: Of course not, because this is a cover -- this is a cover for
race and it always has been. They`re not going to give Ted Cruz a hard
time about it, I don`t think. The mayor could be right. He knows more
than I do.

(CROSSTALK)

MATTHEWS: By the way, I think there are a lot of people on the hard
right that think that Canada is more of a white country, more like us,
America, as they see it. And Hawaii is always suspect a bit.

WALSH: Right.

MATTHEWS: Last thought from you, Mayor Brown.

BROWN: I think that don`t underestimate the potential of the purple
nature of Texas to reveal itself in the next election, in spite of what Ted
Cruz is doing.

(CROSSTALK)

MATTHEWS: Please register out there and please vote.

(CROSSTALK)

WALSH: Yes.

MATTHEWS: All Americans should vote. They should register and vote
and you will have power. Without it, you won`t.

Thank you, Mayor Brown and thank you, Joan Walsh.

WALSH: Thanks, Chris.

MATTHEWS: Up next, you know you`re in a tough spot when you`re on the
receiving end of late-night jokes from Jay Leno and the others. And that`s
what`s been happening now in the last couple days to HHS Secretary Kathleen
Sebelius over the rollout of the Affordable Care Act.

Anyway, this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Back to HARDBALL. Time for the "Sideshow."

Kathleen Sebelius has been taking heat from for the rollout of
healthcare.gov. And Jay Leno thinks he`s gotten to the root of the
problem.

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

JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": Something made me
think she`s not the most technologically savvy person.

(LAUGHTER)

LENO: I don`t think she`s really up to date on the latest technology.

Well, here. Here. Here`s the interview.

DR. SANJAY GUPTA, CNN SENIOR MEDICAL CORRESPONDENT: Did you find it
challenging? What did you think of it?

KATHLEEN SEBELIUS, U.S. HEALTH AND HUMAN SERVICES SECRETARY: The
product is there. The prices are good. It will not sell out. And the
prices won`t change.

GUPTA: The president did say that he was angry about this. I mean,
do you know when he first knew that there was a problem?

(LAUGHTER)

LENO: How old is that cell phone?

(LAUGHTER)

(END VIDEO CLIP)

(LAUGHTER)

MATTHEWS: Next up, Mitt Romney took a lot of heat during the 2012
campaign for owning a total of six houses across the country, including one
with an elevator for his car. But now he`s building another.

And some intrepid journalist at "The Salt Lake Tribune" dug up the
blueprints of House number seven. And they found something that caught
their eye. It was a secret room. It sounds like something out of the
board game "Clue," but it`s for real. Just look at the blueprints. A wall
of shelves is actually labeled as a hidden door. And behind that door is a
room labeled office supplies. Sounds Innocent enough. We all know he
likes to stock up at Staples.

But maybe that`s where his keeps his binders full of women.

Up next, why Republicans have good reason to fear that if the
president`s health care program succeeds, they lose.

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.

Two Americans were kidnapped by pirates who attacked their oil supply
ship off the coast of Nigeria. The captain and chief engineer were
believed to be taken ashore.

Two National Guardsmen were shot outside an armory in Tennessee by a
fellow Guard member. Those victims are suspected to be OK. The suspected
gunman was disarmed by other soldiers.

And take a live look at the White House tonight. It is lit up pink in
honor of Breast Cancer Awareness Month.

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

MATTHEWS: Welcome back to HARDBALL.

Later, I will talk about the president who personifies the role of
Washington in American government, FDR.

Anyway, first, as President Obama has pointed out, Republicans have
made it their Holy Grail to destroy the president`s health care program,
whether it`s shutting the government down for two weeks or threatening
economic catastrophe via government default. There`s quite literally
nothing Republicans won`t do if it means a chance to harm the president`s
health care law, even if they harm themselves or their own constituents in
the process.

Well, today, Republicans began a veritable witch-hunt in response to
the rocky rollout of healthcare.gov. It began with the testimony from the
government contractors who helped build the ACA Web site itself. When it
will end is anybody`s guess.

Republicans in today`s hearing, including Joe Barton from Texas, used
it as another opportunity to try to frighten and scare people about the
law. But they took heavy fire from the law`s defenders. Here it is.

(BEGIN VIDEO CLIP)

REP. JOE BARTON (R), TEXAS: How in the world can this be HIPAA-
compliant? HIPAA is designed to protect the patient`s privacy and this
explicitly says in order to continue, you have to accept this condition
that you have no privacy or no reasonable expectation of privacy.

REP. FRANK PALLONE (D), NEW JERSEY: So, once again, here we have my
Republican colleagues trying to scare everybody.

BARTON: Will the gentleman yield?

PALLONE: No, I will not yield to this monkey court or whatever this
thing is.

BARTON: This is not a monkey court.

PALLONE: Do whatever you want. I`m not yielding.

I am trying to tell you the problem here...

(CROSSTALK)

BARTON: Protecting American citizens is a legitimate concern of this
committee.

(CROSSTALK)

PALLONE: The preexisting conditions don`t matter. HIPAA doesn`t
apply.

(CROSSTALK)

PALLONE: There`s no health information in the process. Why are we
going down this path? Because you are trying to scare people, so they
don`t apply and so therefore the legislation gets delayed or the Affordable
Care Act gets defunded or it`s repealed. That`s all it is, hoping people
won`t apply.

(END VIDEO CLIP)

MATTHEWS: Well, Frank Pallone of New Jersey is the one who you saw
there defending the law. He`s a Democrat from New Jersey. Jennifer
Granholm is the former governor of Michigan.

I have got to go to you, Congressman.

What do you smell in the water? What`s going on with this effort?
Somebody once said people don`t do their best work when they`re being
dumped on. This idea that somehow if we dump on it enough, if we negative
cheerlead, we used to do in high school, negative cheerlead over and over
and over again, get the young people spooked, make them not apply for it,
make everybody feel terrible, then we can win the fight and prevent it from
taking hold with the American people.

PALLONE: Well, the problem is that the Affordable Care Act is
dependent on people signing up. In other words, the more people you have,
the larger your insurance pool, the more effective it is, the cheaper it
becomes.

And so when you`re looking at Congressman Barton, where he`s trying to
scare people to say, don`t sign up because your privacy is going to be
impacted in some way, well, he`s hoping that people don`t sign up. So,
they`re taking advantage. They`re glorifying these computer glitches.
They`re trying to scare people their privacy is going to be impacted.
They`re trying to do whatever they can, including shutting down the
government, to make sure that this doesn`t work.

And this wasn`t a legitimate hearing today. That`s why I called it a
monkey court, because they weren`t trying to fix it. They weren`t trying
to work with the contractors to figure out how they can improve it. They
just wanted to make people say, well, this doesn`t work. It`ll never work.
So let`s delay it or let`s get rid of it.

That`s their goal. And they don`t -- you know, I said they don`t have
clean hands. They come in here with bad intent, not really trying to fix
the situation.

MATTHEWS: Governor, this in private -- you`re an attorney -- and in
private sector business, you can put up a sign, don`t go to that
restaurant, you will get ptomaine poisoning.

You can`t just poison another competing operation. In this case,
these people feel the complete right for a free fire zone. It started with
the death panels. Just say something. An older person might hear it and
go, oh, I hear they have death panels. They`re coming to get me.

JENNIFER GRANHOLM (D), FORMER MICHIGAN GOVERNOR: But the news is,
though, Chris, as these stories come out about people successfully signing
up, whether they`re using the telephone or they`re using the Web site, it
will overcome all the negativity.

Even these governors that have rejected Obamacare and have rejected
the expansion of Medicaid, eventually, those states will all be part of
this, in the same way that Medicare covers everybody, in the same way that
the rollout for Medicare Part D was glitchy, but everybody signed up.
This, too, will be overcome by the positive stories.

Yes, we have got a problem with the Web site. But they have got five
months now to try to fix it before people get penalized. It`s going to get
fixed. People will come on and even eventually those red states, maybe not
with these governors, but with the next ones, they will come on too.

MATTHEWS: Well, to your point, Republicans on the state level have
done everything they can to derail the Affordable Care Act.

Case in point, take a look at the states that rejected or are likely
to reject an expansion of Medicaid under the ACA, that expansion, which
would have helped provide insurance coverage to millions of poor Americans.
Don`t forget that the federal government would have paid for nearly all the
expansion. Yet numerous Republican-controlled states chose to reject it
simply because it was part of the law.

Look at that. It looks like a typical collection result, by the way.
More importantly, it`s the same story for the states that refuse to build
their own heath care exchange, which has placed significantly more stress
on the federal exchange. Again, it`s the same collection, or coalition of
Southern, and Republican-controlled states whose lawmakers want this law to
fail.

On the other hand, states that have embraced the law are already
seeing the benefits. Oregon, for example, has cut its uninsured rate by 10
percent in a matter of days.

Congressman, this is a -- I don`t want to start Ft. Sumter and the
guns firing, but there`s an aspect of civil war. In fact, the return of
the Confederacy in this. These conservative people seem to think that
they`re representing their states by basically sabotaging this program
which is, in fact, part of the law.

PALLONE: Exactly. It`s all ideologically driven by the Tea Party
Republicans who don`t believe that the federal government should help you
get health insurance. Either they shouldn`t provide it under Medicaid or
they shouldn`t subsidize it under the Affordable Care Act. It`s just --
their ideology that stands in the way of trying to help people.

When you talk about states that or governors that don`t take Medicaid,
which is 100 percent federally funded, you`re talking about very poor
people who can`t get insurance, have no way of getting insurance. And to
just keep them out of this so they don`t get coverage is a tragedy. It
really is. And why does the ideology have to stand in the way?

GRANHOLM: Yes, in addition to that, Chris, I would just say that
those governors that are rejecting federal funds, federal dollars come from
their citizens too. You don`t think this is a great campaign issue for a
Democratic candidate for governor in one of those red states next time to
say, you folks in Texas, you folks in Alabama, you`re paying for the health
care in Michigan, because you`re refusing to accept any federal dollars to
insure your people.

MATTHEWS: I know. That`s --

(CROSSTALK)

GRANHOLM: But, I mean, you want your tax dollars going to fund
people`s health care somewhere else or keep our own? These governors in
the last decade, they all would have said, hell yes I`m going to take
federal dollars because my citizens have been paying their taxes and we
should get that money back home. By the way, I`ll also set up the exchange
because I don`t want the federal government coming in here and doing it.

But these new breed of governors, it is a totally different ball game.
And the federal government is expanding in their states as a result of them
having their hands off.

MATTHEWS: Well, nobody said the Tea Party was rational. Anyway,
GOP`s biggest fear I think, just may be that history repeats itself. In
the 1930s, Republicans forcefully opposed Social Security.

Take a look at this clip of Alf Landon, the GOP presidential nominee
in 1936.

(BEGIN VIDEO CLIP)

ALF LANDON, 1936 GOP PRESIDENTIAL NOMINEE: This is the largest tax
bill in history. And to call it Social Security is a fraud on the working
man.

(END VIDEO CLIP)

MATTHEWS: He didn`t go anywhere. Landon lost 46 of 48 states, and
the Republicans wouldn`t get back to the White House until `53. Same story
of the 1960s when Republicans, including an upstart by the name of Ronald
Reagan opposed Medicare.

(BEGIN AUDIO CLIP)

RONALD REAGAN, FORMER PRESIDENT: If you don`t do this and I don`t do
it, one of these days, you and I are going to spend our sunset years
telling our children and our children`s children what it once was like in
America when men were free.

(END AUDIO CLIP)

MATTHEWS: Republicans have had to live down their opposition because
Medicare has become one of the most popular government programs ever.

Anyway, this is Ted Cruz`s biggest fear and even he admits. Let`s
listen to Ted Cruz --

(BEGIN AUDIO CLIP)

SEN. TED CRUZ (R), TEXAS: The Obama administration plan is very
simple. It is to get many Americans as possible addicted to the subsidies,
addicted to the sugar, because they know the simple fact that in modern
times no major entitlement has ever gone into effect and then been undone.

UNIDENTIFIED MALE: Exactly.

CRUZ: So they just want as many people receiving subsidies because
once that happens, I believe it is likely that Obamacare will become a
permanent feature of our economy.

(END VIDEO CLIP)

MATTHEWS: There you have it. The biggest fear of the Republicans is
it will be popular eventually. They don`t want to lose again.

I see you shaking your head, Congressman. Isn`t that their fear on
the Republican side?

PALLONE: Oh, I don`t think there`s any question that that`s what
they`re concerned. And, Chris, I would point. If you remember, Medicare
part D --

MATTHEWS: Sure.

PALLONE: -- the pharmaceutical benefit, when that was passed, a lot
of Democrats, including myself didn`t like it because there were a lot of
loopholes and the donut hole and lack of coverage. When it finally went
into effect, there were a lot of glitches very similar with the computers
and the first few months. But we sat down even in our same committee that
you showed today and we worked with the Republicans to fix it because we
wanted to make sure that seniors have their prescription drug benefit.

MATTHEWS: Good for you.

In other words, you believe in -- you believe in positive government,
sir.

PALLONE: Exactly.

MATTHEWS: Good for you.

PALLONE: It shouldn`t be ideologically driven. They need to look at
this practically that it`s helping their own constituents. But they refuse
to do that.

MATTHEWS: Thank you, U.S. Congressman Frank Pallone and former
Governor Jennifer Granholm of Michigan.

When we come back, achieving greatness in a uniquely American way.

HARDBALL back after this.

(COMMERCIAL BREAK)

MATTHEWS: Coming up, the kind of leader Democrats want today.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: We`re back.

The debate over the role of the federal government is older than
Washington itself. No president personifies, by the way, the power of
government more than Franklin Delano Roosevelt. He`s best known for
pulling us through the Great Depression, of course, and leading America to
victory in World War II.

But in between those dual challenges was a pivotal event that forged
his legacy and distinguished him from any other president in U.S. history,
his decision to run for and win a third term.

In his new book, "Roosevelt`s Second Act," author Richard Moe examines
the former president`s motives for seeking an historic third term.

Welcome, Richard.

I think what people think of Roosevelt, most of us say, greatest
president of the 20th century. He got us through the Great Depression,
probably got us above it all, won World War II, to the point where people
like -- I was thinking, who was it, one of the Joseph Allison (ph) said, in
one of the books I read, people never doubted we`d win the Second World War
because Roosevelt was our president.

What power, what influence.

RICHARD MOE, AUTHOR: No question about that.

MATTHEWS: So, tell me why he decided to run for a third term, which
made all that possible.

MOE: Well, he had planned to retire. And over a period of 10 months,
from September of `39 to July of `40, when the Democratic Convention
convened, he gradually changed his mind. And in the end, it was the war
that changed his mind. And he couldn`t find another Democrat who would
support both his domestic and foreign policies and who he thought could win
the election.

He pleaded with Cordell Hull, secretary of state, almost until the
end. He wouldn`t run. So, he --

MATTHEWS: He was afraid that a more conservative guy who would run,
who wouldn`t want to fight the war and wouldn`t want a New Deal to
continue.

MOE: That`s right. He didn`t want anybody who was about a New Dealer
and he didn`t want anybody who wouldn`t support his policy of aid to
Britain when Britain was hanging by a thread.

MATTHEWS: Everybody I think forgets, I occasionally do what it was
like in this country. France had fallen, England was threatened, the low
countries, Belgium, Denmark, Holland were gone, the Nazis were over -- they
had overrun continental Europe. In the middle of all of that, we had to
pick a president, and we had Wendell Willkie gets picked by the
Republicans.

I`ve always liked Willkie. He was an ex-Democrat, he was an
independent, and he came out of nowhere. Didn`t Roosevelt think he`d be a
good president?

MOE: He came out of nowhere, absolutely. And the fact that Willkie
was picked reaffirmed FDR`s decision to run, because he knew no other
Democrat could beat Willkie, and nobody else -- and FDR didn`t think --
maybe he wouldn`t beat Willkie.

But the real Willkie story, Chris, was after the election, where he
came to Roosevelt and said, I want to support Lend-Lease, and he did.
Lend-Lease, which made up America, the great arsenal of democracy, would
not have passed without Willkie`s support and FDR always gave him credit
for that.

MATTHEWS: I consider that one of the great moments, besides, the
great (INAUDIBLE) I`ve read about in the book -- I`ve written about
bipartisan, how Harry Truman picked Hoover to run the Hoover Commission.
And people don`t do that anymore. And the fact that FDR, the greatest
president of the 20th century, said, I`m going to pick the guy I just beat.
And I was afraid of him a bit. I`m going to make him my emissary to
Europe.

MOE: He did.

He had a famous dinner with Willkie the night before his third
inauguration. They stayed up until midnight talking, having a few glasses
of wine, and he gave him a hand-written letter to Churchill as his
emissary. And Willkie went over there, saw what was the blitz was doing to
London, came back, and made an impassioned plea for Lend-Lease, and it
passed, and FDR gave him full credit for it.

MATTHEWS: Well, if he survived, he didn`t have good health. Willkie
was dead pretty much four years. If he would have survived, the Republican
Party might be a different party perhaps if he had won in `48, for example.

MOE: He might very well have. But by supporting Lend-Lease, he was
going against the leadership of his own party and he probably ruined his
chances to get that nomination in `44. As you point out, he was ill. So
that precluded it.

MATTHEWS: You know, I`ve always had three heroes, Jack Kennedy,
Franklin -- three heroes. Hemingway, of course, we all know Hemingway as a
hero, Winton Churchill, and more and more I find I like Roosevelt --
despite the fact that he was a bit cold and distant and tricky.

What do you feel towards him, Franklin Delano Roosevelt, our greatest
president of the 20th century? What do you feel towards this guy?

MOE: There`s a duality to it. He was a very principled and moral
statesman who set very high goals, but in pursuit of those goals, he could
be a little tricky. He could be very manipulative, and even duplicitous.
But that`s who he was.

MATTHEWS: Did he ever get -- did he ever figure out Joe Stalin? Did
he ever figure out what a menace he was, what a killer he was, right up
there almost with Hitler?

MOE: I don`t have answer to that. That`s beyond the scope of what I
wrote about it.

MATTHEWS: We rarely have a guest that doesn`t have an answer.

I`m not sure I think it`s one of the great questions, did he ever get
the truth about Joe Stalin.

MOE: It`s a very good question.

MATTHEWS: Anyway, thank you. The book is called "Roosevelt`s Second
Act."

Thank you, Richard Moe. An old friend of mine from the glory days.

When we return, let me finish with my political coming of age.

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Let me finish tonight with this:

"Tip and The Gipper," the story of my political growing up, just hit
"The New York Times" bestseller`s list for the third straight week. I even
had someone tell me the other day that it`s the best book that I`ve ever
read. Well, that thrills me, because this new book is really about how I
got from being a Peace Corps volunteer, riding a motor bike out there in
rural Africa, to being right here where I`m sitting.

It`s about my wild inside life in politics, what I saw, what I
learned, and where I picked up the spirit that I had that we can make it --
that this America of ours can be all that we can be.

I sometimes feel like zealous (ph), though, this guy who`s been forced
to be on the inside of history, from being there when the Berlin Wall was
coming down, to the first all races election in South Africa, to the vote
for the peace agreement over in Northern Ireland, which still means so much
to me personally. Though I didn`t put my name in the title, "Tip and The
Gipper" is stocked with the backroom stories of my coming of age
politically.

You can get it right now online from Amazon, of course, right now, or
at Barnes & Noble and other bookstores when you`re out there this weekend.

So please get a copy of "Tip and The Gipper", and follow my trail from
the Senate to Air Force One to the back rooms of the U.S. Capitol and see
what makes me tick. As I said, it`s the trail of how I got here and
something every HARDBALL fan will get a kick out of.

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

"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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