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The Rachel Maddow Show, Transcript 07/29/11

Guests: Luke Russert, Howard Fineman, Barbara Lee, Jonathan Capehart

MELISSA HARRIS-PERRY, GUEST HOST: Hi, Lawrence. Thanks so much. And thanks for you at home for staying with us tonight. All it took was 24 long hours. But tonight, the top Republican in the country, the man who is third in line to the U.S. presidency, finally managed to gather up enough support from his own colleagues to save his speakership. Now, just a short time ago by the slimmest of margins, the House of Representatives passed House Speaker John Boehner‘s bill to raise the country‘s debt ceiling. But raise it with a whole bunch of asterisks. As you‘ll recall, this was a vote that was supposed to happen last night, but just minutes before it was set to come to the floor, John Boehner found himself with an all-out mutiny in his own party. And, so, today as we sit just four days away from cataclysmic default, today was a day spent by representatives in Washington, not negotiating to see if a deal could be reached to avert catastrophe, but rather watching and waiting to see if John Boehner would be able to keep his job as House speaker or whether it would all fall apart. Today was a day of pure, ultimately pointless, political theater. Now, Mr. Boehner was, in the end, able to pass a bill out of his own chamber tonight after 24 hours of arm twisting. But as Americans across the country called for a balanced approach to the deficit problem, House Republicans passed a bill that calls for more than $2 trillion in spending cuts exclusively. Corporations, y‘all go ahead and keep all those tax breaks. As the world markets call for a resolution to this self-created crisis, a return to relative stability, House Republicans passed a bill that calls for this fight to happen all over again just in time for the holidays, six months from now. Now, less than two hours after Republicans passed the bill through the House, the one that took them 24 hours to get enough votes for, Democrats in the Senate voted to kill it. And, in fact, we‘re going right now to the Senate to see Harry Reid. Here he is. SEN. HARRY REID (D-NV), SENATE MAJORITY LEADER: Senator Murray asked to be excused because of a family situation. All good. Her husband is here. Tonight, a bipartisan majority in the Senate rejected Boehner‘s short-term plan. Clearly we‘re seeing something we‘ve seen a lot here in the Senate. But this time the country‘s attention is focused on it, a filibuster—a filibuster to prevent us from moving forward on this legislation. The proposal that I put forward is a compromise. We changed it even more today. We would have changed it even more. But as I indicated on the floor, we had no one to negotiate with. The Republican leader said he wouldn‘t negotiate with me. (PHONE RINGING) REID: I don‘t know whose that is. Not mine. SEN. DICK DURBIN (D), ILLINOIS: Your pizza‘s ready. (LAUGHTER) REID: It really is a worst possible time to be conducting a filibuster. They are forcing to us wait until tomorrow morning at—let‘s see. Today is still Friday—until Sunday morning at 1:00 a.m. to have this vote. Our economy hangs on the balance. And for the first time in the history of our country, unless there is a compromise, or they accept my bill, we‘re headed for economic disaster. It‘s time for the Republicans to step forward. There‘s been some movement today. We‘ve—as indicated on the floor, I was supposed to have a meeting in my office this afternoon with some Republicans. That fell through. But we‘re told that the press picked up as they were walking into a conference, they had three Republican senators said they were interested in my bill, they‘re interested in compromise. We hear a lot of happy talk, but they need to step forward. Republicans are blocking their ability to compromise. They are refusing to negotiate with us, and all they do is talk and that isn‘t enough to get it done. The House will hold an up-or-down vote we‘re told on my proposal. We should be allowed to do the same. That‘s all we‘re asking. It‘s time for us to be adults. That‘s what the American people want. It‘s time to come together in a compromise. That‘s what the American people want, and that‘s what we need to do. Senator Durbin? DURBIN: I‘m sure you recall the speech that was given to the American people on Monday night by Speaker Boehner. He talked about his bipartisan bill. And he talked about the fact that he was going to pass it in the House of Representatives. We waited for that on Tuesday, again on Wednesday, then on Thursday, and finally today, passed it, but it wasn‘t bipartisan. All Republican votes, not a single Democratic vote, and a scant majority -- 218 out of 435-member house. When it came to the United States Senate, it was dead on arrival, on a bipartisan basis. A bipartisan majority of senators, 59, voted to table the Boehner proposal. And now we have a chance to reopen this conversation. And I can tell you, there is a growing sentiment among senators on both sides of the aisle to sit down and reach a reasonable compromise and to save our economy from the disaster that awaits us if we fail to extend this debt ceiling. What these senators on the Republican side are waiting for is a permission slip from Senator McConnell. He told them to hold back until Boehner had his chance. Hold back until the Boehner bill came to the floor. That‘s all history now. The American people want us to move forward. They want us to come up with a bipartisan approach that doesn‘t have us relive this scene that we‘ve seen for the past week over and over and over and over again, like the old Groundhog Day movie. We want to get this done in a way so we can say the economy is going to move forward with a certainty that we‘re going to have a debt ceiling extension and we are not going to jeopardize it with the problem of self-imposed political problems and wounds that can be avoided. It‘s a shame. We waited all day, this morning, Senator Reid went up to Senator McConnell on floor and said let‘s talk. Let‘s work this out. Nothing, nothing all day long. Not all day long. And later, at the end of the day, a call from Senator McConnell who said I‘m not going to negotiate with you. That‘s unfortunate. The American people deserve better. And let me say one last thing. If Senator McConnell would give us the same vote standard in the Senate that was given to Speaker Boehner in the House, we could pass Senator Reid‘s proposal—a proposal which includes major elements suggested by Senator McConnell. But, no, they insist on a filibuster. He said 60 votes have become routine—routine because filibusters have become routine on the Republican side of the aisle. It isn‘t what‘s necessary to enact this law so critical to the future of America. We‘re going to fight this filibuster and I hope, in the end, some Republicans will cross over and join us and break the stalemate and come up with a bipartisan agreement. Thank you. SEN. CHARLES SCHUMER (D), NEW YORK: You know, this morning at 10:00 a.m., on the floor of the Senate, Leader Reid asked Senator McConnell to come negotiate. The door was open all day, nobody knocked. Nobody walked in. And some said, well, Speaker McConnell wanted to wait until the House disposed Boehner. But after the Boehner amendment was defeated, in a telephone conversation with Leader Reid, I was sitting there, Senator McConnell still refused to negotiate. We will not solve this problem by standing there and folding our arms and saying, I am not talking to anybody. And the nation‘s future is at risk. Republican senators, I‘ve talked to 10 today. They want to come to an agreement. But until Senator McConnell gives them the green light, nothing is going to happen. And they get the vibes, and perhaps the direct word, I don‘t know, from the Republican leader, don‘t do anything. We all know in the Senate we can‘t pass anything without a bipartisan agreement. We all know the Senate is the only way out of this mess. You‘ve seen the huge difficulties in the house, their inability to even tie their own shoes, and so it‘s up to the Senate. And that means it‘s up to Senator McConnell to either negotiate himself or give permission to others to negotiate so that we can finally come to a bipartisan agreement. The only game in town is the modified Reid bill. It‘s a bill that has elements proposed by Republicans, including Senator McConnell. It‘s a bill that has elements proposed by Democrats, but it meets the strictures that both parties have laid out, on our side, that it must extend the debt ceiling beyond 2012, no short-term extension, it too much roils the market. On their side, no revenues and as many cuts as increases in the debt ceiling. If they don‘t like it, even though if it seems to be a prescription drawn from their needs, what do they want as an alternative? They are very good at saying no. They are not very good at laying out a plan that can actually pass. And instead, what do they do? They just filibuster. They say you can‘t proceed to a bill and vote on it. They say they are going to force us to delay and delay and delay until we get up to the deadline. The country‘s in crisis. This is not a time for politics as usual. I think we have shown that we are willing to give significantly in their direction. We‘re still waiting for Speaker McConnell, Leader Boehner, sorry. We‘re still waiting for Leader McConnell and Speaker Boehner to move a little bit in our direction. REID: We‘ll take a few questions. Not many tonight. We‘re all tired and had a long night and a longer tonight tomorrow. Yes? REPORTER: Senator Reid, (INAUDIBLE) you had his bill, his own bill to your bill? Because cuts, he was willing to have his own bill with no cuts guaranteed. I‘m wondering, if, you know—one thing you didn‘t do, you didn‘t add any triggers. There‘s been a lot of talk about real triggers, having real significant weight that would force the deficit reduction committee to pursue real cuts. Why didn‘t you do— REID: We‘ve got a closet full of triggers that people have suggested, literally, dozens of them. But even though they are good ideas, earlier this week, a few days ago, I was sitting talking to Jack Lew, Office of Management Budget, and Rob Nabors, who we all know is such a good person. We talked for an hour and a half about different triggers. I came to the solution we are negotiating with ourselves. We can‘t get Republicans to agree to any trigger that involves revenue. We cannot, the American people know this, because they agree with us. We‘re not going to have cuts to more programs, more programs and more programs without some revenue. It is—it is—that is a line that we‘ve drawn in the sand and we‘re going to stick with it. I spoke a couple of times tonight to Leader Pelosi, she agrees with me 100 percent. REPORTER: So, the House has passed two plans now, and what‘s— Senator Schumer says this is the only game in town now. What is your contingency plan if this doesn‘t get through the Senate? REID: Oh, I think Senator Schumer laid that out pretty clearly. The plan is to work off our bill. We have a message from the House. It‘s easy to—if there‘s an agreement it comes up, it‘s easy to amend that, and send it back to the House. They only vote over there. To think with a straight face—to think with a straight face that they sent us something that the American people would accept, the Ryan budget, cap and cut, whatever that is, and then this thing? That‘s not legislation. That is a—that was an extravaganza over there that made them look very foolish. Yes? REPORTER: Everyone now is wondering, Friday night, going into the weekend, what is the endgame? How is this going to end up? I know you‘re calling for Leader McConnell to come to the table and negotiate, but what is the way forward from here? REID: It‘s up to the Republicans. Right now, we have a fine proposal. Extends the debt ceiling until March of 2013, yet reduce the debt by 2$2.4 trillion. It‘s a fine piece of legislation. It sets up the joint committee to even make further cuts. It would be something that we believe and Senator McConnell will acknowledge this very strongly, as does Leader Pelosi, we could get something out of this. So, we‘re waiting for them to do something, anything, move toward us. But if that fails, they should go for our bill, because it‘s basically—and that is things that they already voted on, things they already agreed to. Last question. REPORTER: (INAUDIBLE) reduced your debt ceiling increase to $2.4 trillion and increased savings from $2.2 trillion to $2.4 trillion. But it doesn‘t lay out how you do it. And you mentioned in back there, that you used the January baseline. Are all of the increased savings due to (INAUDIBLE)? REID: CBO has come up with those numbers and I told you before, we have laid out all the numbers, you can dissect them, look at them. But this is what CBO has recommended, and we have followed their advice. Thank you. HARRIS-PERRY: That was the Democratic leadership in the Senate holding a late night update on the status of the debt ceiling negotiations. And joining us now is MSNBC news correspondent Luke Russert. Now, he has been following this drama all day and night. I know, because my television has been tuned and I have been seeing you. Now, Luke, first of all, do you think any chance that phone call that interrupted Mr. Reid could possibly have been McConnell calling to say he was prepared to negotiate with him? LUKE RUSSERT, NBC NEWS: What did Reid say, must have been the pizza guy or something? That was a good joke by him. But, no, it sheds light on what‘s been an interesting development of what we heard from Senator Schumer today, which is that Harry Reid called Mitch McConnell 10:00 a.m. this morning, and they said, hey, look, the door is open, I‘m ready to negotiate. Heard nothing back from McConnell. And we heard from a few other Democratic senators, at about 6:00 p.m., McConnell told Reid at this point he was not going to negotiate with him. So, the schedule is as of right now to try and get a cloture vote early Sunday morning, actually 1:00 a.m. Sunday morning, late, late tomorrow night, if Mitch McConnell does not want to negotiate tomorrow, it looks like Harry Reid‘s going to have to find about eight or nine Senate Republicans to come on board with a deficit reduction package, which would also yield itself to an increase in the debt limit. So, there‘s a long, long way to go on this. And I would also add that the timing, now, becomes ever so important, because with the cloture rules and the way in which the parliamentary procedure operates in the Senate, you would have 30 hours to cloture, 30 hours after that final vote and whatnot, you could feasibly see a scenario of which whatever compromise comes out of the Senate does not get over to the House of Representatives until Tuesday, maybe Tuesday evening, right up against that 12:00 a.m. Wednesday deadline, and that could have a real affect on the markets in ways which, I think, nobody knows sure. That‘s why each negotiating tactic, not negotiating, or Harry Reid just said, what‘s the way forward? Well, we have to wait for the Republicans to tell us because we don‘t know right now. That is really what the consequences are. It puts the limit on Tuesday, the ultimate end, it makes it that much more important, because there is no back stop. If they miss it, they go into Wednesday, Thursday, maybe they pass a temporary one, but there‘s a lot of unanswered questions still out there. HARRIS-PERRY: Yes, I‘m admittedly just shocked that here it is, late on Friday night, and we are still this much in the process. I mean, not even really—it feels like moving forward towards any kind of reasonable negotiation, and with the deadline on Tuesday, as we‘re looking—this is beginning to stress me out and I can imagine the markets are beginning to feel that strain as well. RUSSERT: Absolutely, and what‘s even more interesting in this whole, if you look at it in a macro level, if you look at what the markets wanted to see from the U.S. in terms of sizable deficit reduction, for it to really make an impact, to really try to get the country on the right pathway, if you will, from a financial standpoint, it had to be about $3 trillion or $4 trillion in cuts. That‘s not going to happen because the grand bargain fell apart. So, now, you‘re essentially arguing about a smaller number, $1 trillion in cuts, which doesn‘t necessarily mean a lot on the world stage, if you will, here in D.C.—as a political term, it means a fair amount—but this small, minuscule amount in the grand scheme of things has become the line in the sand where both parties want to go all out on and fight this battle to the high heavens, and it could have huge economic effects and ones that even if it were to pass through, there‘s no guarantee the government would keep its AAA rating. And what‘s interesting about this is if you talk to folks close to the leaders, if you talk to folks who are around here, they are on the same page. They don‘t want to deal with this. They want to move on from this. They realize they are playing—as one Republican aide told me, this is a radioactive bomb. We‘re playing hot potato with a radioactive bomb, was his phrase. But because of a small minority of the United States House of Representatives, which has been about contrarian, the blocking minority— Charles Krauthammer called them in “The Washington Post,” they have not been able to move forward just procedurally. HARRIS-PERRY: Right. RUSSERT: And that is really the story is coming out tonight, procedurally, they are are still very much where they were weeks ago. HARRIS-PERRY: Indeed. NBC News correspondent Luke Russert, looks like no rest for the weary just yet. RUSSERT: No, no. All the way to Wednesday, 12:01 a.m. HARRIS-PERRY: Absolutely. RUSSERT: Take care. HARRIS-PERRY: Thanks. Joining us now is Howard Fineman, editorial director of “The Huffington Post” and MSNBC political analyst. Howard, it‘s nice to see you tonight. HOWARD FINEMAN, MSNBC POLITICAL ANALYST: Hi. How are you tonight? HARRIS-PERRY: Well, I‘m not sure. FINEMAN: Stress out. Stress out. HARRIS-PERRY: Yes. Sure, after listening to that. Look, you know, I was listening to Senator Schumer basically calling on maturity, a kind of sense of adulthood, where are the grownups in the room. But, particularly, when he said listen, we all know that the Senate is the only way out of this mess. Now, given how dysfunctional the Senate is as of late, should I be concerned the Senate is the only way out of this mess? FINEMAN: Yes, that‘s not reassuring, isn‘t it? And having covered the Senate for a long time, I can tell you the way they operate sometimes isn‘t very reassuring. I think, to go to Luke Russert‘s point, it‘s not just this drama now, I think what the markets are looking at, what corporate America is looking, what world leader are looking, is whether our country is suffering some kind of political nervous breakdown, and maybe a sort of permanent inability to deal with the fundamental questions of our economy and our finances and our society. How we deal with entitlements, how we deal with the ageing of the baby boom, how we deal with our tax structure, how we create jobs—all these really fundamental questions are not being dealt with in this drama. And this drama is really about avoiding these questions rather than dealing with them. And people looking at the long-term health of the American economy and whether we still have going to keep our AAA bond rating are worried not just about this, but this is a symptom of some deeper problem we‘ve got. HARRIS-PERRY: So, Howard, let me ask you about that, because I think that those are actually reasonable kinds of concerns for a society to have and I think that‘s a reasonable conversation for a society to have, what kind of place are we, how will we spend our money. But why link that, in this case, to the debt ceiling—which could, after all, be a clean vote. We could simply make a decision to do the debt ceiling, and we do have, after all, an election coming up. It seems an election would be exactly the right time to have this kind of public dialogue about who we are as a country. FINEMAN: Well, there are a couple of answers to that. First of all, as the size of the debt, the national debt, has grown. It really is big right now, almost as large as the whole economy itself and it hasn‘t been that way since the end of World War II. People have been increasingly attempted to use the debt ceiling vote as a political weapon. The Democrats did that a few years ago. As a matter of fact, Barack Obama, when he was a senator, not president, voted against an increase in the debt ceiling for political reasons himself. But when the Tea Party arrived, they use this vote as an excuse for a kind of building takeover. I‘m of the ‘60s generation—this feels to me like occupying the administration building, OK? That‘s who the Tea Party people are. They want to stop the system with a capital “S.” They think they are doing the lord‘s work, literally, in doing so, and that‘s the problem John Boehner had in dealing with them. I mean, he didn‘t have money to give them, instead of giving them pork, because there are no earmarks, he gave them constitutional pork in the form of this vote on the constitutional amendment to balance the budget. HARRIS-PERRY: Right, look, I‘m not even against sit-ins in administration buildings on college campuses, I see where they are useful. But part of why they are useful is because students don‘t have much power relative to their administrations. I think what I find so surprising here is these are, after all, elected officials, and they‘re elected to the House of Representatives whose main job it is, after all, to spend money. I mean, that‘s really what the House of Representatives does, right? It spends our money, our budget collectively on our collective goods. So, is there something broken either ideologically or structurally? I mean, is there something that‘s simply not working beyond the idea of taking over the administration building? FINEMAN: Yes, there is. And I don‘t mean to diminish them or building takeovers. The thing is our system has become unable to deal with the deep questions, the fundamental questions. Republicans are be darned if they are going to do anything to raise taxes, and they‘ve managed to control the debate on taxes to a point where President Obama and the Democrats have exceeded the point now for a couple of years on taxes. The taxes have been kept at Bush-era levels now three years into the Obama administration. On the Democratic side, they refuse to deal with the long-term consequences of the ageing of the baby boom and what that means for Medicare and Social Security and entitlements down the road, and instead, we‘re watching a spectacle where these—both of these bills would whack away at the defenseless in our society while leaving untouched middle class benefits for the most part. And this is dysfunctional—it is dysfunctional. The dysfunctional thing is not so much this drama that we‘re watching as it is the deeper—our deeper inability to deal with those problems. HARRIS-PERRY: Indeed, Howard Fineman, MSNBC political analyst and “The Huffington Post” media group‘s director. I‘ll take over the administration building with you anytime, Howard. FINEMAN: OK. I‘ll find one. Take care. HARRIS-PERRY: We will be right back. (COMMERCIAL BREAK) HARRIS: It is possible to keep cool in a crisis, even in a real crisis. The fight that‘s happening in Washington right now does not need to be happening. It‘s a crisis created by a debate in Congress about whether or not it‘s wise to destroy the economy. But nearly 10 years ago, our nation was facing a real crisis, one created by the attacks of September 11th. And three days later, right in the middle of that very real, very emotional crisis, Congresswoman Barbara Lee gave this speech on the floor of the House. (BEGIN VIDEO CLIP) REP. BARBARA LEE (D), CALIFORNIA: September 11th changed the world. Our deepest fears now haunt us. Yet I‘m convinced that military action will not prevent further acts of international terrorism against the United States. Let‘s just pause just for a minute and think through the implications of our actions today so that this does not spiral out of control. As a member of the clergy, so eloquently said, “As we act, let us not become the evil that we deplore.” (END VIDEO CLIP) HARRIS-PERRY: Joining us now, a cool head in a real crisis, Congresswoman Barbara Lee, Democrat of California. Congresswoman, thank you so much for being here tonight. LEE: Well, I‘m very happy to be with you tonight, during this very chaotic time. HARRIS-PERRY: I truly appreciate it. I took some time again today to listen to that moment, you know, three or four days after September 11th, when you just said, let us pause just for a moment and think through the implications of our actions today. And I‘m thinking, that‘s maybe what someone needs to call on us to do right now. So, what do you think about this current crisis that we‘ve created out of this debt ceiling debate? LEE: Well, I think, first of all, this is drama on the Republicans side like I have never seen before, but it‘s very tragic, because we‘re on the brink of an economic collapse. People are relying on us to raise the debt ceiling and, quite frankly, Melissa, I think we should raise the debt ceiling, look at how we could move forward to create jobs. I mean, that‘s what people want. They are desperate for jobs. And look at how we can move forward to help reduce our deficit. But we have to be sure that we raise this debt ceiling. It‘s been done under Republican and Democratic administrations. We should just do it, raise the debt ceiling, move forward, look at how we begin to invest in our people and creating jobs. And yes, we have to look at how we bring this deficit under control, but we have to do that in a reasonable way. We have to have it balanced approach. We must look at raising revenues, and also some cuts that are reasonable. I mean, when you look at the Pentagon—certainly, these two wars, they need to end. There are billions of dollars there. We need to look at the Bush era tax cuts—the millionaires, billionaires, oil companies and federal tax subsidies that they are getting. There are many ways to raise revenues. And so, I think this debate and this theater and this drama has gotten out of control. And we need to bring it back to what‘s real. People need jobs, we need to invest in jobs, we need to raise this debt ceiling immediately so that we don‘t crash, and that‘s where we‘re headed. And then we need to have a rational discussion about deficit reduction. HARRIS-PERRY: Now, Congresswoman Lee, I have respected that during your career on the Hill, you‘ve been one of the most forthright voices of one of the most vulnerable members of our society. As you see us hurdling towards this cliff on Tuesday, is there anything you can imagine as a possibility for moving us forward in a way that doesn‘t end up harming those who, as you‘ve just said, are the most in need of our support as a country and you in particular as an elected representative? LEE: Sure, we need to raise the debt ceiling. It should be a clean debt ceiling. Many of us have said that for many, many months now. I don‘t think this should have been attached to any part of debt reduction consideration or calculation. But is what it is. And so, we have to move forward now and, one, we protect Social Security, Medicare, and Medicare, and, two, that we protect all those safety net programs for people who are the most vulnerable, who are the poor and who are low-income. May be intended or unintended consequences of any of these cuts could be more people fall into poverty. And, you know, now, Melissa, I have to establish a couple of years ago an out of poverty caucus within our Democratic Caucus. We have 39 members of that caucus now, and our focus is to look at these policies and initiatives and legislative efforts and their impact on the poor. Poverty is rising in our country. Low income people are suffering. They are desperate. And we have middle income people now falling into the ranks of the poor. And so, we have to make sure whatever we do in the next few days will not hurt seniors, will not hurt our children, and will not hurt the most vulnerable. That‘s what I‘m terribly, terribly most concerned about. All Democrats are concerned about. I don‘t know how this Republican Tea Party—these Republican Tea Party members believe that their people in their districts aren‘t suffering. I don‘t know how they come to grips with the fact they have children and senior citizens and people who need jobs. This is horrible. And I think we need to move forward, quickly raise this debt ceiling, and then get back to the drawing board and see how we can create some jobs, reduce the deficit, and move forward to create opportunities for all. The American Dream is turning into a nightmare for millions. It‘s been a nightmare for millions. And we have to figure out how to get pathways out of poverty. So, these efforts we engage in in the next few days have to protect the most vulnerable and must protect our senior citizens and the needy. HARRIS-PERRY: Congressman Barbara Lee, Democrat of California—thanks for helping us keep our eye on what‘s important in the midst of this political theater. And thank you for joining us. LEE: Glad to be with you. HARRIS-PERRY: Thanks. Freshman Illinois Congressman Joe Walsh‘s star is rising in the Tea Party because he is so very, very concerned about the debt. His own debts, however, not so much. That‘s just ahead. (COMMERCIAL BREAK) HARRIS-PERRY: Are you familiar with Fail blog? It‘s a blog that‘s been around for awhile. It documents failure. Failure that you can see, that is obvious, that is visual. It‘s very funny. For example, there‘s this one labeled “a towel condition fail.” Don‘t worry, they are just slightly soiled. This one is a cuisine combination fail, Chinese-Mexican. And my all-time favorite, the cake fail, which needs no explanation. Well, last night, Speaker of the House John Boehner had a leadership fail. It was a failure you could see. After so much hype and publicity and waiting around and postponing, in the end, Speaker Boehner was not able to get his own party to back his bill to raise the debt ceiling. Everyone knew the bill was going to be dead on arrival in the Senate, but they still would not vote for it, and even with the promise that legislation would go nowhere, Boehner could not get the House Republicans in line behind his leadership. And so, the vote was delayed until today—that vote that the speaker could make changes, that that was moved so the speaker could make changes in the bill in order to appease as many of these hold outs as possible. Now, that bill finally passed tonight, but like as I said, it‘s dead as a door nail—a door nail six feet under, a door nail six feet under that‘s pushing and kicking the bucket. The Boehner bill is dead. But our memory of last night is decidedly not. And today, those of us who care about a functioning Congress, who are hoping for functioning Congress, are asking what the heck happened last night? How did things go so terribly wrong for the Republicans and the speaker? Now, one theory bouncing around the Beltway is that it‘s the Tea Party fault. That the members of the Tea Party caucus are so concerned with ideological purity that they, as a unified block, undermined the speaker and held fast against his debt plan. But as David Weigel points out today, that‘s not exactly true. Now, look at this—look at the list of the 60 members, meaning the 60 members of the Tea Party caucus—how many of them are firm “no” votes? Seven. Seven out of 60 does not make for steadfast opposition. So, if it‘s not the players, maybe it‘s the rules of the game, the answer I am proposing was put forth on this show last night by our own Luke Russert. Earmarks—also known by those who don‘t like them as pork. Earmarks were the allotment of funds to specific districts for a specific project that would get attached to spending bills in the House. (BEGIN VIDEO CLIP) RUSSERT: One of the first things the House GOP did when they came into power was have an all-out ban on earmarks. And I think if you‘d speak to them privately tonight, they‘d really wish they still had the earmark capability, to be able to hand a bridge project to some of these members on the fence. They no longer have that. (END VIDEO CLIP) HARRIS-PERRY: They no longer have that ability. Now, granted, there is so much ideology going on in the Tea Party that maybe that‘s like offering steak to a vegetarian. But still, they really have no ability to horse trade, because when Republicans took over the House in the last election, they vowed in a non-bindingly—in a non-binding way, I‘m sorry, to ban earmarks, to ban them altogether. Their vilification of earmarks was so effective they even got President Obama on the earmark-hating bandwagon. (BEGIN VIDEO CLIPS) SEN. JIM DEMINT ®, SOUTH CAROLINA: We‘re not going to have earmarks, so it‘s really silly for some senior Republicans in the Senate to try to block it. REPORTER: The president today made an overture to conservatives back home, backing their call to ban earmarks, special projects that many consider wasteful pork. REPORTER: Sounding like he‘s been to a Tea Party, the top Republican, Senator Mitch McConnell reversed his own position on federal money for earmark pet projects. CHRIS HAYES, MSNBC CONTRIBUTOR: Republican senators met last night and agreed to a two-year, non-binding earmark moratorium. They join President Obama and newly-minted House Speaker John Boehner who supports the ban. BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Both parties in Congress should know this, if a bill comes to my desk with earmarks inside, I will veto it. I will veto it. (END VIDEO CLIPS) HARRIS-PERRY: Now, in the House, being an effective legislator and leader means knowing how to get leverage and how to use it, but when Speaker Boehner began his leadership tenure by banning the currency by which compromise and consensus are forged, he made the extremely uncomfortable bed in which the entire country sleeps tonight. Speaker Boehner did not have leverage last night, which means he could not get his own caucus to support him, which means he could not bring his own bill to a vote without making foundational, draconian, extremely right wing changes to the leadership bill today. On Twitter, we would call this hashtag leadership fail. (COMMERCIAL BREAK) (BEGIN VIDEO CLIPS) REP. JOE WALSH ®, ILLINOIS: Our government is too big. We have a government that spends too much, and we‘re bankrupting future generations, and we‘re not going to change that until we change this town. And we are falling off a financial cliff. And unless we finally do something about this debt, we‘re placing on the backs of our kids and our grandkids, we‘ll never recover. I won‘t place one more dollar of debt upon the backs of my kids and grandkids unless we structurally reform the way this town spends money. I‘m a freshman, maybe I‘m naive, but I don‘t think unless we force—unless we force Republicans and Democrats to balance their books every year, they won‘t. The only way we can do that is to force them. (END VIDEO CLIPS) HARRIS-PERRY: People don‘t want to be financially responsible. You got to force them to do it. That‘s the message on the debt ceiling debate being preached this week by Tea Party Republican Joe Walsh. Really, Congressman Walsh should know. That‘s pretty much how he became a congressman. When Joe Walsh launched his bid for Congress, it was thought that no Republican had a chance to win in the Illinois 8th district outside Chicago, that no one would actually defeat the three-term Democratic incumbent Melissa Bean, let alone a right wing Tea Party challenger. And then this happened. The local newspaper put Mr. Walsh‘s personal finances on the front page, and they were a mess. “A suburban congressional candidate who‘s stressed the need for restraint, lost a condominium to foreclosure last October, the same month he announced his bid for office, court records show.” Now, this clearly wasn‘t how Joe Walsh was planning to run to Congress. He didn‘t exactly volunteer the information we saw, but once out there, he decided to cast himself as the regular Joe who is feeling voters‘ pain. So, in response to “The Daily Herald” article, he said in a statement, quote, “I know all too well what 8th district families are going through to make ends meet because I‘ve experienced some difficult and humbling financial times. Like so many others in Illinois in recent years, and one in nine Americans nationally, I know what it‘s like to lose a home to foreclosure.” Now, being in a tough financial situation personally can give a person empathy and awareness for how bad things are economically for a nation. If you‘ve experienced foreclosure, you‘ve been given a very personal front row seat to what post-2008 economic America looks and feels like. One can see how, for example, the voters would say I want the Joe foreclosure guy who knows what I‘m going through. I want the candidate who can feel my pain. In November, the voters of the Illinois 8th congressional district elected Joe Walsh over the strong Democratic incumbent by 300 votes, which means Congressman Walsh now gets to be the de facto spokesman for Tea Party Republicans preaching fiscal responsibility. Joe foreclosure gets to use his TV time to tell all Americans, including the president, to put their own financial houses in order. That was the deal. (BEGIN VIDEO CLIP) WALSH: I ran as a guy who had financial struggles like a lot of Americans. This is where a lot of Americans come from right now. It‘s why they sent so many of us to Washington to do something about this because we‘re living this experience. (END VIDEO CLIP) HARRIS-PERRY: Here is what voters didn‘t know about Joe Walsh when they heard him talk about his financial struggles. Here is what they didn‘t know when they trusted him to go to Washington to make sure their children‘s financial futures would be secure, too. What they didn‘t know? What he hadn‘t bothered to tell them was that he had not bothered to fulfill his own obligations to his own children in the most basic way. According to court documents filed in December, Joe Walsh owes more than $1,000 (ph) in back child support to his ex-wife and three children, nine years worth. His lawyer disputes it is anywhere near that amount. Walsh says himself says the “Sun Times” article was a hit piece, claiming he was attacked to distract from his leading role in the debt limit debate. How leading? Well, Walsh calls himself—and I can‘t believe I‘m about to say this—the tip of the spear. To the extent that the Republicans have talked about the sanctity of family, the importance of commitment, here is someone who had a commitment to his own children, no matter what the broken-down state of the relationship with his wife. Representing yourself as Joe foreclosure is one thing, but a lawsuit that appears to cast you as Joe deadbeat dad is entirely something else. This debt ceiling battle is about the fact if we don‘t raise the debt ceiling, America will be unable to meet her financial obligations. Joe Walsh doesn‘t believe it will happen. at least not anywhere or on or near Tuesday. (BEGIN VIDEO CLIP) WALSH: We are so obsessed, Erica, with August 2nd. I think what‘s important is that we get this right. The administration has been trying to scare folks into this notion of default. UNIDENTIFIED FEMALE: So, you‘re OK with a potential default on August 2nd? You would let that date pass? WALSH: Erica, default is not an option. And, look, the administration knows that, most people in your profession should know that, we‘ve got plenty of government revenues in the month of August to service our debt. Default isn‘t even on the table. I‘m not obsessed with August 2nd, truthfully. (END VIDEO CLIPS) HARRIS-PERRY: Joe Walsh is not so obsessed with August 2nd, four days from now. But, earlier tonight, he was one of 22 Republicans who voted against the Republican‘s own debt ceiling bill. Now, part of the reason Joe Walsh might think nothing happens when you don‘t meet your financial obligations, is when it comes to child support, it appears he hasn‘t met those obligations for quite some time. And so far, at least, nothing has happened. But in 2008, when Joe Walsh stopped paying his mortgage, the bank initiated foreclosure proceedings. If America is going to base its next crucial economic decisions in this debt ceiling battle on the financial consequences that have been personally wrought upon Congressman Joe Walsh, I sincerely hope we will all remember the bank actually did take his home. Joining us to talk about this is Jonathan Capehart, MSNBC contributor and opinion writer for “The Washington Post” and such a snappy dresser. Jonathan, it‘s good to see you tonight. JONATHAN CAPEHART, MSNBC CONTRIBUTOR: Great to see you, too, Melissa. Doing a great job. HARRIS-PERRY: Thank you. Now, what are the implications of having a guy who lost his home to foreclosure and someone who owes nearly a decade of back child support, someone who doesn‘t believe a default is even a possibility, with him leading the American as the tip of the spear in the next four days? CAPEHART: Look, his credibility on this issue is crumbling by the day. The takedown by Lawrence O‘Donnell in the previous hour, your list, the dossier of damages against this guy is leading into that. And, you know, for him to call him the tip of the spear, I think, is sort of the height of arrogance. This is not—this is not coming to light because he is leading the Tea Party charge against raising the debt ceiling and pushing for a balanced budget amendment and things like that. He e is under scrutiny because he put himself out there—he is screaming for attention. He is getting it. He would love it if the “Chicago Sun-Times” which found the court documents in this nine-year battle, they were on a profile. He would have loved it if they just focused on the foreclosure, which is already out there, and did something else—maybe from his perspective glowing about him. But, instead, what they found was this nine-year battle over $117,000 in back child support payments and now, he is saying that this is coming to light because he is going up against—that this is some sort of political hit. HARRIS-PERRY: Right. CAPEHART: And that just isn‘t the case. HARRIS-PERRY: Well, let me push you on that, that sort of political hit piece, but this is part of what I have found distressing. I mean, it‘s almost too easy to take a shoot as this guy as the deadbeat dad who refuses to put burden, you know, on kids. CAPEHART: Right. HARRIS-PERRY: But part of what concerns me here is this language that default is just a myth. That it‘s a hoax, this idea that bad things won‘t really happen. How can we sort of sound the alarm, push back against that idea? CAPEHART: Well, look, this is the problem. We have never been in this situation before as a nation. We have always had AAA bond rating. We have always met our obligations. We are now going over, potentially going over the cliff in a way that no one has ever seen before. Not here in Washington, not in America, not in the world—which is why people are in a bit of stunned shock, paralysis, from the markets to world capitals. They cannot possibly believe that the United States would not raise its debt ceiling. And, you know, quite frankly, no one knows what is going to happen. And Joe Walsh is trying to use that to say it‘s no big deal because on August 2nd, maybe the market doesn‘t crash. Maybe the world doesn‘t end. But it could a few days after that. HARRIS-PERRY: Yes. Jonathan Capehart, MSNBC contributor and opinion written for “The Washington Post”—we do live in interesting times. CAPEHART: Yes, we do. Thanks, Melissa. HARRIS-PERRY: Thanks for your time. We will be right back. (COMMERCIAL BREAK) HARRIS-PERRY: That does it for us tonight. I‘m Melissa Harris-Perry. And I can tell you, after just four days of sitting in Rachel Maddow‘s chair, I have more respect for her than ever. This is an extraordinary and tough job. Thanks to Rachel for letting me sit in. You can follow @MHarrisPerry on Twitter. We appreciate you‘re taking the time to watch and we ask you to stay with MSNBC all weekend for coverage of this crisis that just won‘t stop. “THE ED SHOW” is up next. THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END