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The Rachel Maddow Show, Transcript 08/16/11

Guests: Ezra Klein, Eugene Robinson, Ed Schultz

RACHEL MADDOW, HOST: Good evening, Chris. May I please be a guest on your show sometime? CHRIS HAYES, MSNBC HOST: Yes, I would love that. MADDOW: Thank you. Sorry, I put you on the spot like that. HAYES: Happily. MADDOW: Also delighted. Thanks a lot, Chris. And thanks to you at home for staying with us for the next hour. Today was day two of President Obama`s big three-day looks like a campaign, sounds like a campaign, but we swear most definitely is not a campaign bus tour through the Midwest. And again because this is not -- not a campaign trip, they say, today, Mr. Obama`s bus tour found itself rolling through Iowa of all places. Oh, hey, what do you know, must have taken a wrong turn somewhere. But now that we`re here, hello, Iowa! After weeks of Republican presidential hopefuls barnstorming the state of Iowa, today the Democratic presidential nominee for 2012 took a tour through the state as well, and the message President Obama delivered in Iowa today is the message that he`s really been delivering at every stop along this tour through the country this week -- we need jobs, we need jobs now, and we need Congress to get to work on getting America some jobs. (BEGIN VIDEO CLIP) BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The prime driver of economic growth and jobs is going to be our people and the private sector and our businesses. But you know what? Government can help. Government can make a difference. So, I hope that I can count on you in the days ahead to lend your voice to this fight to strengthen our economy. I need you to keep your pressure on your elected representatives for things like the payroll tax cuts or road construction funds, or the other steps that will help to put our country back to work. (END VIDEO CLIP) MADDOW: Government can help. Government can make a difference, he says. That`s the message President Obama has been delivering in Iowa. It`s what he said today -- government has a role to play in getting the economy back on its feet. That sort of thing sounds like a foreign language to you. If it sounds like the stuff of pipe dreams, that it`s probably because Republicans in Washington have spent the better part of the last eight months somewhat monopolizing the discourse by convincing everybody that no matter what sort of dire straits the country is in, no matter what sort of disaster we are mired in, there can really be no fiscal policy to improve the economy whatsoever. There can be no action taken by the government to improve the economy. And if the Democrats or the president want to try it, Republicans in Congress say they will block it. Whether or not they will block everything remains to be seen, President Obama`s trying to change those dynamics in part with his bus tour this week, telling folks at every stop to express themselves to Congress -- is all the stuff we can do, the president is saying, call your member of Congress, tell them we should do this stuff, tell them we should use economic policy to help create jobs. The president started trying to enlist average Americans` help for leverage against Congress during the debt ceiling fight. He is continuing asking Americans for their help now. But if Republicans keep convincing the Beltway nothing is possible, if that is true, if Republicans are, in fact, going to be able to block everything that President Obama and the Democrats want to do to overtly help the economy, if the shocks we`ve been through over the last few weeks from getting our credit downgraded -- S&P says because Republicans said national default was no big deal to them we got downgraded -- from the downgrade, to the stock markets terrifying ride of the last few weeks, if those shocks are not enough to shock us into a new political reality, and Republicans really are going to stop any new fiscal action to help the economy, then there`s really only one other tool that is available to the government, and it is called monetary policy. It`s the Federal Reserve. It`s how much money there is in the economy at any time, interest rates charged to banks, it`s all that fun stuff. The president alone can`t do anything on fiscal policy really -- fiscal policy is only controlled through Congress. That`s the whole purse strings thing, right? And Republicans, so far at least, have decided to stop any fiscal policy from going through Congress. So, the only other thing available is the Federal Reserve. It`s an independent agency. It is run, in fact, by a Republican who was appointed by George W. Bush. It`s this baldy, beardy man, named Ben Bernanke. Now, no matter how soporific the whole idea of monetary policy is, and the actions of he Federal Reserve -- come on, puppy, stay awake, stay with me, puppy -- up, up, not down, wake up, puppy, come on, it`s going to be -- up. No matter how adorably sleep inducing Fed monetary policy is, come on, there you go -- yes! Wall Street and the private sector actually find baldy, beardy Ben Bernanke to be rather riveting. The U.S. economy needs a shot in the arm right now, right? It needs a little bit of help. But if Republicans are going to stop that from coming from the president or Congress, then -- I mean, not to be gross, but even the suggestion of the possibility of a little stimulation from this fellow at the Fed is the sort of thing to send Wall Street into ecstasy. You may recall last month when Ben Bernanke testified before Congress and mentioned the mere possibility of the Fed launching a new round of stimulus. The instant reaction to that comment was that stocks shot up almost immediately. The market loved the idea of the Fed doing something to help the sputtering economy. You may recall last week when the Fed announced it was going to keep interest rates exceptionally low for the next two years, the market shot up more than 400 points that day after losing 600 points the day before. The extent to which congressional Republicans are able to stop there from being any jobs policy in Congress to help the economy is the extent to which we are all sort of dependent on hopefully, maybe, the Fed doing something to try to help. It`s essentially the only other option that the country has. If you don`t want the economy to be helped, if you sort of like the idea of the economy being absolutely in the tank when a Democratic president was trying to run for reelection, you better that hope not do congressional Republicans keep blocking any policy from getting through Capitol Hill, but you also better hope that the Fed feels too afraid to act as well. And it is in that context in which the latest entrant into the Republican presidential rate, Texas Governor Rick Perry, today threatened to lynch baldy, beardy Ben Bernanke, the chairman of the Federal Reserve. (BEGIN VIDEO CLIP) GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: If this guy prints more money between now and the election, I don`t know what y`all would do to him in Iowa, but we`d -- we would treat him pretty ugly down in Texas. I mean, printing more money to play politics at this particular time in American history is almost treasonous in my opinion. (END VIDEO CLIP) MADDOW: Lynch the chairman of the Federal Reserve if he tries to help the economy. Stay out of Texas, Ben Bernanke. People being outraged about this is likely to be exactly what Rick Perry wants. This was an applause line for him, and not only is he not apologizing for it, he`s proud of it. Governor Rick Perry telling reporters today, quote, "I`m just passionate about the issue and we stand by what we said." Being deliberately provocative with lines like this is one of the ways that Rick Perry has tried to shape his image as a candidate. I mean, saying on day two of his campaign that the U.S. military doesn`t respect President Obama, saying that the president does not love the United States or at least saying he`s not sure if Mr. Obama does and he really should be asked whether he truly loves the United States, refusing to tell a reporter who asked whether or not he was carrying a gun on the campaign trail. Ben Smith from "Politico" reporting, quote, "I asked Perry whether he`s armed today, he declined to say. Quote, `That`s why it`s called concealed.` This is what gets shorthanded as Rick Perry`s style, his bravado, his swagger. This is actually what he`s marketing as a candidate. As "Salon`s" Alex Pareene put it today, this is feature of the Rick Perry candidacy. This is a feature, not a bug. Governor Rick Perry wants to be seen as the guy who says outrageous confrontational stuff, the guy who threatens bodily harm to the chairman of the Federal Reserve instead of saying a bunch of really boring stuff about what his own monetary policy would be as president. That`s boring. This is his brand. This is the kind of thing that Rick Perry wants to be known for, saying the blunt in politics thing, letting people know how tough he is. And as such, this is one of those moments that is sort of a test for the political system and for the political media. Are you going to help this guy do what he wants you to do? If you want to talk about extremism and Rick Perry, you sort of have two options just from, say, today`s news. You could talk about Rick Perry`s intemperately over-tough language implying perhaps not metaphorical violence toward an economic policy official that is, in fact, a form of stylistic extremism which he would be delighted for you to cover -- please, he`d be pleased if you were outraged about it, so try to be outraged. Or another option is to talk about Rick Perry saying Social Security is a Ponzi scheme, that is unconstitutional and must be abolished at the federal level. That`s a different kind of Rick Perry extremism. You can talk about Rick Perry saying yesterday that the United States government should have defaulted rather than raising the debt ceiling, saying he would have voted against raising the debt ceiling. That`s another option. That`s substantive extremism. Governor Perry made it clear last month that in his mind, the United States going into default would be no big deal. (BEGIN VIDEO CLIP) PERRY: I think this -- this threat that some how another the world`s going to come to an end and the threat of we`re not going to be able to pay our bills is a bit of a stretch. (END VIDEO CLIP) MADDOW: So that`s an option, that sort of comment, that substantive Rick Perry extremism, and that is available for discussion. Rick Perry also opposed to the 16th Amendment to the Constitution, repealing that, of course, would eliminate the federal income tax, which would remove 80 percent of all government revenue, because that will help the debt problem. That is, strictly speaking in terms of its relationship to mainstream economic thinking, that kind of idea -- get rid of the source of 80 percent of all federal revenue, getting rid of the income tax altogether, that technically speaking is extreme when compared to mainstream economic thought. Perhaps if he was threatening to beat the 16th Amendment to death in Texas, instead of proposing just to repeal it, maybe then we could get some kind of political shock and outrage over that kind of extremism as well. Joining us now here on set is Ezra Klein, columnist for "The Washington Post" and Bloomberg, and MSNBC policy analyst. Ezra, I got to tell you -- you have been doing a great jobs hosting in the afternoon on the "MARTIN BASHIR SHOW." EZRA KLEIN, MSNBC POLICY ANALYST: Thank you. That`s very kind of you. MADDOW: What is your take on Rick Perry`s warning to the chairman of the Fed? KLEIN: I`m sort of loving. Is that a fair take? MADDOW: OK. KLEIN: We are having, I guess, an ideas campaign. What is remarkable about that Perry clip if you actually back up a little bit, is he began by saying I`m not going to take a position on the Federal Reserve. I think he said, I want to part of it. MADDOW: Yes -- I want to take a pass of the Federal Reserve. KLEIN: Then he thought for a moment, actually, if I was going to have a position, we should possibly beat him. It`s really quite a take, but it is extraordinarily ignorant. I mean, even putting aside how much money you print between now and the election, there will be growth in the American population, Rick Perry knows this. Texas is one of the quickest growing states in the Union. And what does he think the money supply`s supposed to do? Sit there, it doesn`t grow, where it`s going to have less money as we have more people? That is a really quite bad idea. MADDOW: Does this come from an idea if you just talk generally about money and generally about spending and generally about debt without actually getting to the specifics of what it is that you`re criticizing, just the mention of those things sounds bad to people and makes you sound like a fiscal conservative? KLEIN: Yes, and then there`s the other set. I call these meta solutions, right? They sound like solutions. They sort of even look like them if you don`t look closely, but they are not. We`ll just pass it up to someone else. Medicaid, Medicare, Social Security, they are unconstitutional, but we`re not going to get rid of them, we`re going to give them to states. It will be somebody else`s problem. Monetary policy, we`re not going to make decisions about it, we`re just going to say we don`t like it. The money supply just won`t move. TARP, we`re not going to say what we`d have done instead of it, we just wouldn`t have had it. We wouldn`t have stimulus, even though Rick Perry had billions of stimulus dollars and it kept him from going into a deficit in Texas. And so, you have this sort of governing theory of just not really saying what you would be doing but saying something but nevertheless taking a position, right? And your position is no position. Your position is you don`t like it and we shouldn`t have done it and that is sort of enough, because who`s going to ask the follow-up question? MADDOW: Well, the follow-up question, to me, is what`s your big idea, bucko, try to sound tough, to go mano-a-mano with the man who wants to be seen as a tough guy in the situation. At the same time, though, when you`ve got this many candidates running for the nomination, when you`ve got them all just saying no and then them all just saying I hate it all, are you elevating any of them to ask them to say what their federal policy would be? I mean, when Rick -- even when Mitt Romney has done that as a guy that`s tried to take it seriously as a frontrunner here and somebody who`s tried trying to engage only the president and not the other candidates on the campaign trail, it seems like they`re pretty confident they`re not going to be pressed on those things, that they just don`t need to politically at this point. KLEIN: And they are right. I mean, when I hear -- when I was watching FOX News debate, which I thought the FOX News folks did a pretty good job, when I heard the doorbell go off after a minute of explaining what they would do about he hardest problems facing the country -- just made me sick to my stomach, give them five, give them two, give them three, I`m sorry -- put the puppy on, but we might need to hear it. And what`s amazing about what Perry is doing is that the GOP used to have a big idea, it was called the Federal Reserve. Milton Friedman, he`s a conservative icon, he was Reagan`s economic advisor. He won a Nobel Prize as an economist and he said, the Great Depression, it was all monetary, it was a monetary failure, and Republicans like this. By the way, he was right, but they liked it because that meant it wasn`t private businesses fault and the only answer we have to recessions is in Congress spending a bunch money, you can act through the Federal Reserve in a more disinterested way outside the political process. And get in the way of it. Perry is throwing all of that out and he doesn`t have a new framework to support what we should do, he just has nothing. But to actually get at that, you need to have a long conversation, you need to talk about Milton Friedman, and monetary policy and money basis, and nobody likes that. But if we had had basically the nothing policy that he`s talking about, we would have had a Great Depression. MADDOW: When you look though at the spectrum of Republican idea that is being represented by the presidential candidates, whether or not that door bell is going off of the debate -- do you feel like there is an articulated conservative economic policy that is a legitimate alternative to what the Democrats are proposing or is it all just no, no, no? KLEIN: Well, there`s Mitt Romney who is sort of implying that maybe he`d do something similar to what the Democrats did but not quite. I mean, a lot of what the Democrats did was basically stolen from George W. Bush or Mitt Romney. TARP and the auto bailout began with Bush. The individual mandate began with Mitt Romney. Stimulus is not a particularly conservative -- or liberal policy. Obviously, Bush had his stimulus before Obama came in and in the early (INAUDIBLE) Paul Ryan and others were saying we need a tax cuts stimulus for that recession. So, one of the problems Republicans have, not so much Romney because he`s pretty good at sort of passing this stuff around, but the rest of them is they have opposed to everything the Obama administration did. But the Obama administration, in trying most everything, has taken off the table a lot of what their Republican Party wanted to do. So, they are not left to many solutions. MADDOW: Right. KLEIN: I mean, right now, they are opposing payroll tax cut, an extension of the payroll tax cut. So, when the Republicans oppose to payroll tax cuts? MADDOW: Right. And Newt Gingrich is the only one that is dissenting on that, which is fascinating. I cannot wait to see how that plays out. Ezra Klein, columnist for "The Washington Post" and "Bloomberg," MSNBC policy analyst -- Ezra has been guest hosting on "THE MARTIN BASHIR SHOW" here at 3:00 p.m. Eastern and doing a spectacular job of doing it. Ezra, thanks for being here. KLEIN: Thank you. MADDOW: Still ahead, Ed Schultz, Eugene Robinson, and how the president is kind of secretly taking a turn in his politics -- a turn that should make happy the people in his own party who have criticized him for being too soft on Republicans. We have the evidence on tape. That`s ahead. (COMMERCIAL BREAK) MADDOW: The president today in an interview on CNN, making some news about the nation`s footing and expectations regarding a potential terrorist attack. (BEGIN VIDEO CLIP) BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The biggest concern we have right now is not the launching of a major terrorist operation, although that risk is always there. The risk that we`re especially concerned of right now is the lone wolf terrorist, somebody with a single weapon being able to carry out wide-scale massacres of the sort that we saw in Norway recently. You know, when you`ve got one person who is deranged or driven by a hateful ideology, they can do a lot of damage, and it`s a lot harder to trace those lone wolf operators. (END VIDEO CLIP) MADDOW: The president`s new remarks echoing those of his own Justice Department, which just recently warned of lone wolf style attacks, like the president mentioned that just took place in Norway. The president also telling CNN today there might be, in his words, a little extra vigilance in monitoring potential terrorist risks as the 10th anniversary of the 9/11 attacks approaches. We will be right back. (COMMERCIAL BREAK) MADDOW: Earlier this month, on the occasion of President Obama`s 50th birthday, we did a review on this show of the vast conspiracy theory that Barack Obama is not who he says he is, that he is secretly foreign and therefore, secretly not really president of the United States, and his fake birth certificate that made it seem like he wasn`t foreign is really part of an elaborate plot hatched in 1961 to do something -- not quite sure what, but it definitely sounds bad. Because President Obama released a second form of his Hawaiian birth certificate this spring and promptly decided to launch the mission to kill Osama bin Laden in the same 48-hour period, it has been sort of nice to know that as President Obama is running for reelection this year and next, at least we won`t have conservatives this time around questioning his Americanness. At least that`s over. Oh, wait. (BEGIN VIDEO CLIP) PERRY: I think you want a president that is passionate about America, that`s in love with America. I know what this country needs. (END VIDEO CLIP) MADDOW: Asked later to clarify what he means by saying America needs a president that`s in love with America, presidential candidate and Texas governor Rick Perry rather doubled down. (BEGIN VIDEO CLIP) REPORTER: Governor, you said you would be a president who loves America, are you suggesting the current president does not love America? PERRY: No, you need to ask him. REPORTER: Are you suggesting he does not? PERRY: I`m saying you`re a good reporter, go ask him. (END VIDEO CLIP) MADDOW: You`re a good reporter. Go ask the president if he loves the country. That`s what a good reporter should do, because I don`t know if he loves the country. Apparently, it is going to be another year like that, birtherism is dead, long live the accusation of the president`s secret foreignness. You know, the filing deadline is not until November, right? Maybe there`s still time for Orly Taitz to get in? Joining me now is Eugene Robinson, Pulitzer Prize-winning columnist at "The Washington Post" and an MSNBC political analyst. Eugene, I`m glad I could persuade you to talk about this. Thank you for being here. EUGENE ROBINSON, MSNBC POLITICAL ANALYST: It`s great to be here. MADDOW: How does -- how does one prove that you are in love with America? ROBINSON: Well, as you know, the traditional way, and actually the surest way is with a bumper sticker. So, here`s my idea -- see, the president has this new bus, right, the souped-up bus, this amazing -- he could put a really, really big bumper sticker on the back that says I heart America and then everybody will know. MADDOW: When Rick Perry said this today, particularly with a follow- up question, I don`t know, you`re a good reporter, go ask him. It`s actually what he said. It struck me when I saw it as old school, as really the return of Orly Taitz. As the sort of the thing that the respectable right might be over by now, might be a little embarrassed by. But we saw Karl Rove and other people on the right, very upset with what Rick Perry had said about Bernanke, nobody seems to be peeping about this. Does that mean it`s back for the campaign? ROBINSON: You know, I`m not sure it`s actually back. It might be in Rick Perry world, right? You know, he`s in the -- in the past two days he`s demonstrated why people, Republicans I know in Texas, have said this guy is going to blow up. You know, it may be that this is just who Rick Perry is, that these intemperate things he says are, yes, part of his design. But, in fact, are off the -- just out of bounds and are going to get him in serious trouble. I don`t think the Karl Roves of the world like going back to this mime, I think it`s been done, and he killed Osama bin Laden. So, it really doesn`t have the kind of traction that it once had. MADDOW: When you`re talking about Republicans who are skeptical of Rick Perry`s chances, though, and they see that -- they see a line like this as something indicating that he`s not going to last in the long term, I see a line like this as evidence of his discipline, that he`s just going to run with the you come down to Texas, we`ll show you what a Fed chairman has to face when he does something that I can`t explain about federal policy, I don`t believe that the president loves America, the military doesn`t respect America, he never served in the military -- he`s just going back to old school stuff, he`s going to stay disciplined with it, and it doesn`t strike me he`s responding to the outrage over these comments as if he`s made a gaffe. ROBINSON: No, he certainly is not. But, you know, Texas politicians that succeed in the rest of the country tend to modulate their Texas-ness a bit. They tend to speak in language the rest of the country gets. And so, when you talk about Ben Bernanke in terms of a lynching, and when you go back to this old, and frankly tired, canard about the president`s love for America, I`m not sure that -- if this is, indeed, by design and discipline, I`m not sure it`s a good idea. I think if he wants to stick around in this race, he`s going to have to dial it back. He may never apologize for these things, but saying them again, I -- you know, if he`s going to keep hitting on this, not sure it`s a good idea. MADDOW: I wonder if there`s room here for a Democratic countercharge, what do you think the effect would be if the president actually engaged on this and said you know what, America, we`re tired of having our patriotism questioned because we love America in a way that the conservatives want -- I mean, is there room for that sort of countercharge? Have politics changed enough to capitalize against him on this? ROBINSON: You know, I think there may well be, and I would love to hear the president give that speech. In fact, he has given any number of speeches before and since becoming president that were just brimming and oozing with his love for this country. So, he certainly laid the groundwork for any such speech and attack campaign he would go on, and I think it would be great. It would at least flush out the other Republican candidates and force them to take a stand and say, you know, what do you think about the president`s love of America -- Democrat`s love of America, and let`s get this on the table, good idea. MADDOW: And, you know, I have to say if that happened and the other candidates were questioned about that, that gives them all the opportunity to say, you know what, Rick Perry, you can be the wing nut guy if you want to be, I`d like to be considered one of the serious candidates now, and it gives them all a chance to do that. ROBINSON: Exactly. It could make Michele Bachmann seem reasonable. MADDOW: Oh, please. Eugene Robinson, Pulitzer Prize-winning columnist of "The Washington Post," MSNBC political analyst -- once again, thanks a lot for your time, Gene. I appreciate it. ROBINSON: Great to be here, Rachel. MADDOW: All right. The best new thing in the world today will not be the best new thing in the world today for your arteries or waistline. But for everything else -- pure, delicious awesome. That`s coming up right at the end of the show tonight. (COMMERCIAL BREAK) MADDOW: Two last recall elections in Wisconsin are being decided today. In one of the two races, the Republican candidate is the author of a children`s book that`s called "With My Rifle By My Side." It`s a children`s book. Results on how that candidate and all the candidates did tonight in Wisconsin coming up in just a moment. (COMMERCIAL BREAK) MADDOW: At the end of George W. Bush`s second term as president, everybody knew that his vice president, Dick Cheney, would not be running to succeed him. Dick Cheney would not be running for president, why did we know that? We just knew that. So, there was going to be a primary in 2008 for the Democrats and a primary in 2008 for the Republicans as well -- wide open on both sides. There was a lot to pay attention to that election cycle. But this year, after about 14 seconds of cable news chatter about whether President Obama might get a primary challenger in the Democratic Party, ha, everybody turned all their attention to the Republican side, because that`s what presidential politicking is about this year, it`s just the Republican side. And as everyone is increasingly riveted by the fight for the nomination among the Republicans, even today, August 16th, the chat is still about whether more Republicans might still get into the race. In this environment where everybody`s watching the presidential politicking only on the Republican side, in this environment, President Obama has effectively started his own reelection campaign this week. The president embarking on a bus tour of the Midwest starting yesterday. (BEGIN VIDEO CLIP) OBAMA: Hello, Cannon Falls! Hello, Minnesota! Hello, Dakota! Hello, Iowa! It is wonderful to be back in Iowa. This place is as pretty as I remember it. (END VIDEO CLIP) MADDOW: Well, everybody in the beltway has been flipping quickly through the coverage of President Obama`s Midwest bus tour to see if he said anything sound byte-y about Mitt Romney, or Michele Bachmann, or Rick Perry. I`m not sure it has been widely noticed that what the president has been doing out there is showing how he is going to run for reelection. (BEGIN VIDEO CLIP) OBAMA: I want everybody to understand here that I`m not here just to enjoy the nice weather. I`m here to enlist you in a fight. We are fighting for the future of our country -- and that is a fight that we are going to win. If all of you are enlisted in the fight to make sure that we`ve got a country that is looking out for middle class families and promoting common sense and thinking about the next generation and not just the next election and is thinking more about country than it is about party and is less interested in vilifying opponents than figuring out how to get something done, then we`re going to start electing folks who do that. (END VIDEO CLIP) MADDOW: The election itself is not for 15 months, and the president has the luxury of not having to run in a primary against Democrats before the general election takes place. But probably the single most important thing on Election Day that will determine whether or not President Obama is reelected is, of course, the state of the economy and jobs. And if the economy and jobs don`t get better between now and 15 months from now when the country is voting, who will voters blame for things not being better? And so, the president, not technically campaigning, but heck, traveling Iowa by bus, the president is making his case, making the critical campaign-style case for the difference between the parties. Spoiler alert, here comes the Republicans Paul Ryan budget vote to kill Medicare. Listen. (BEGIN VIDEO CLIP) OBAMA: There are two contrasting visions that are going to be presented over the next year and a half. In this debate that we still have to finish about how to close the debt and the deficit and how we move this country forward. And I`m on the side of a vision that says we live within our means, but we still make investments in the future and everybody pays their fair share and we`ve got shared sacrifice and shared opportunity. And on the other side, you got a vision that says we are going to make sure that those who have benefited the most pay the least and we under- invest in education and we under-invest in infrastructure, and we under- invest in basic research. That`s their vision. And we dismantle Medicare as we know it and make it into a voucher system. Well, that`s -- I don`t think that`s the way America`s going to grow. That`s not how America`s going to prosper. But the only way we`re going to be able to win that argument is if you guys make a decision that you want a country that`s big and bold and generous and not one that`s cramped and just believes in a winner take all economy and which everybody else is left out in the cold. That`s not the kind of -- that`s not the kind of America that I was raised in. Not the kind of America I believe in. (END VIDEO CLIP) MADDOW: The main stylistic criticism of President Obama from within his own party, from people who say they supported him and they still support him, but they want more from him -- and I don`t mean the disagreements on certain policies, but I mean, things about his style as president, the main criticism is that the president has not confronted the Republicans enough about their political sins. He is now doing that confronting on what is effectively the campaign trail in Iowa. A corollary of that main criticism, again, from within his own party, stylistic criticism of his presidency is Republicans have been getting too much out of him in negotiations, that the president ought to say what he wants, what he think the country needs and make the country believe it and make Republicans pay a price if they don`t go along with it if they don`t. Convert the popularity of Democratic ideas into political leverage against Republicans, to get his way or at least go down swinging while saying and standing up for what he believes in. He, again, is now doing that on what is effectively the campaign trail in Iowa. Listen. (BEGIN VIDEO CLIP) OBAMA: There are bipartisan ideas, common sense ideas, that have traditionally been supported by Democrats and Republicans that will put more money in your pockets, that will put our people to work, that will allow us to deal with the legacy of debt that hangs over our economy. We could renew the payroll tax cut that we gave you in December that put $1,000 in the pocket of a typical family. We`ve got pending trade legislation. Congress right now could start putting folks to work rebuilding America. Today, I`m announcing that we`re ramping up our efforts to get capital to small businesses and rural areas. Let`s give tax credits to companies hiring our veterans, and let`s put them back to work and let`s let them use their skills to get this country moving again. Congress could do that right now. I want to pass a road construction bill to put tens of thousands of people to work all across America. I`ll be putting forward when they come back in September a very specific plan to boost the economy, to create jobs, and to control our deficit. And my attitude is: get it done. And if they don`t get it done, then we`ll be running against a Congress that`s not doing anything for the American people, and the choice will be very stark and will be very clear. (END VIDEO CLIP) MADDOW: Don`t tell the beltway, because frankly there`s no reason yet to interrupt the Michele Bachmann coverage. But President Obama is running for reelection and we now know how he`s going to run for reelection. Does this show he has taken to heart some of the constructive criticism that`s been levied against him from his most avid supporters? Joining us now is our own Ed Schultz, host of "THE ED SHOW," which, of course, follows this program every night. Ed, thanks for making the time tonight. I know it`s not an easy thing to do. Thanks for being here. ED SCHULTZ, HOST, "THE ED SHOW": Thank you, Rachel. Good to be with you tonight. MADDOW: Are you seeing a shift from the president on this bus tour, or do you feel like this is a continuation of what he has been say something? SCHULTZ: No, I think the president knows that his base is very frustrated and the worst thing the base could do with all of these Republicans who are propping up and running for nomination, the worst the base could do is to freeze up. And the president, I think, has to own some responsibility to make sure that the base doesn`t freeze up. They are not totally happy with the way he has negotiated, as you mentioned in the set-up piece about how he`s gone back and forth with the Congress. Congress is at a 13 percent approval rating in some polls because they haven`t done the job. They`ve spent their time being obstructionists, and I think this president can`t get on the road enough to go out and make the case and reintroduce himself and make sure people know exactly what he`s advocating for. But then he`s going to ask for the order, telling them that he is not going to give up and make it in very clear terms that in his first term as president, he had all sorts of olive branches coming out of the White House, the second time around, it`s not going to be that way and he needs our help. That`s what I`d like to see the president do. Now, whether he`s going to do it or not, I`m sure he`s got plenty of advice coming from everywhere. I`m a cable host, you`re a cable host. I supported President Obama, I believe in him. But I think it`s time to take off the gloves and flat-out get after it, because these folks are standing in the way of a lot of progress this country could make, which the president just said in those sound bytes about helping the job market. MADDOW: The thing I`m hearing from him that sounds the newest to me and most pointed in terms of a strategy is the last thing we played him saying there, my attitude is -- he said, I`m going to put forward a specific jobs plan in September. My attitude is get it done, and if they don`t get it done, then, he says -- we`ll be running against a congress not doing anything for the American people and the choice will be stark and clear. That`s sort of what you say before I will win. He`s saying I`m going to go down swinging and then give you a chance to tell me what you think about the two sides here. Do you think that is an effective -- effective line to take between now and 15 months from now? SCHULTZ: I think it`s very easy for people to understand where he`s coming from. I think the president is basically starting to set up a narrative -- you know, this isn`t my fault. You know, I caved in on the Bush tax cuts, I extended them. You know, I didn`t go after the Employee Free Choice Act. I didn`t get the public option of universal health care. I did a lot of good things for Wall Street. I was out there fighting for the automobile industry. You know, everything else we`ve tried to do on jobs, they haven`t come to the table. And I think people will understand that, but they want to hear a little bit more saying this time around it`s going to be different, because I don`t think the base, Rachel, is going to be overly enthusiastic to be out there campaigning, doing all the things they did in 2008, if it`s going to be just more of the same. The base and I think independents want this president to start drawing some lines in the stand. We understand obstructionism. We understand exactly how difficult the Congress has been working with this president. We understand when they call him a socialist and they paint him as un- American. That infuriates, I think, a lot of Americans. And I just think the president needs to pivot now and be far more aggressive and don`t be afraid to point the finger at the Republicans and name names. Name the obstructionists. There`s a yearning out here in the middle of the country right now for the president to step up and get after it. MADDOW: Ed, let me ask you about one very, very important part of the Democrat`s political structure and of the Democratic Party`s base and president`s base, unions. Unions upset that the Democratic Party has once again chosen a non-union state and a city where there`s not even a single union hotel for the Democratic Convention next year in North Carolina. Some unions are pledging not to go to the convention to support Democrats because of that. Is that a rift that the White House can heal and do you see interest on their part to do so? SCHULTZ: Well, I think the White House would be smart to turn to the union heads in this country and ask them the question: do you want Republicans to win North Carolina? Do you want the Republicans to win Virginia? The bottom line is, the president is pretty good at telling people you`re not going to get everything you want, but I would encourage wage earners in this country to put those kinds of things aside and to look at the big picture. But as I will do on "THE ED SHOW" tonight, I will document some things that the president has been saying about organized labor and collective bargaining that I find very troubling and I think people out here in the middle of the country find troubling as well. This president has not delivered for labor the way they thought he was going to -- and I don`t think he has delivered for the middle class the way they wanted him to. But the landscape, the obstructionism, the record number of filibusters in the Senate the first two years has also made it tough for any president to navigate through those waters. But I think that labor, if I had to make a prediction, I think that they will be there for this president when push comes to shove. MADDOW: Ed Schultz, host of MSNBC`s "THE ED SHOW" -- Ed, I got to tell you that I know that you have been a strong supporter of this president and I also know you take policy and the substance and progress issues so seriously that despite the fact that you have been a supporter of him, you`ve also been one of the most blunt spoken critics of him -- and your honesty and straightforwardness of that is something that I`ve always really respected. So, thanks for talking about this tonight. SCHULTZ: Thank you, Rachel. MADDOW: "THE ED SHOW," of course, is right here on MSNBC, right after this show. All right, sometimes the job of a reporter in the field is to chart the ebb and flow of political events that define the contours of the American experience. At other times, the job of a political reporter in the field is to do this -- in the field political journalism is alive and well and risking its health. Best new thing in the world today is coming up in just a moment, tonight with frosting. (COMMERCIAL BREAK) MADDOW: Just under an hour ago, polls closed in the two final recall elections of the summer in the great state of Wisconsin. Last week, it was six incumbent Republicans facing recall election. Two of those Republicans didn`t survive. And they`ll be replaced by Democrats who challenged them. This week, it`s two incumbent Democrats facing Republican challengers. Earlier this summer, in the first Wisconsin recall, another Democratic incumbent senator easily beat the Republican challenging him. But, tonight, at least one and maybe both Democrats has been thought to be facing a tough challenge. The first one is the race in district 12, where right now with 19 percent of precincts reporting, the incumbent Democratic Senator Jim Holperin has 54 percent of the vote. His Republican challenger Kim Simac has 46 percent of the vote. State Senator Holperin is a freshman Democrat. He won district 12 in 2008, narrowly beating the Republican candidate, 51 percent to 49 percent. That district leans Republican with Republican Governor Scott Walker winning more than 57 percent of the vote there in November. And the conservative Supreme Court justice candidate David Prosser winning 10 of the 11 counties in the district just back in April. Senator Holperin`s challenger is Republican Kim Simac. She has not held office before. She`s a small business owner and author. Her most recent book for children is titled "With My Rifle By My Side: A Second Amendment Lesson." She also founded a Tea Party group called Northwood Patriots two years ago. As I said, this race in district 12 could have been expected to be close this evening. At this point, it`s too early to say whether it will be. Again, at this hour, with 19 percent of precincts reporting, the incumbent Democratic Senator Jim Holperin has 54 percent of the vote and Republican challenger Kim Simac has 46 percent. The other recall election today in Wisconsin was in southeastern part of the state, District 22, where at this hour, we`ve got 14 percent of precincts reporting. The incumbent Senator Bob Wirch has 44 percent. His Republican challenger, Jonathan Steitz has 56 percent of the vote. State Senator Wirch has been elected to the Senate four times, including a race in 2004, when he beat then-attorney, now National Republican Party chairman Reince Priebus, despite being outspent in that race by Mr. Priebus three to one. State Senator Bob Wirch`s competition tonight is also an attorney, a corporate lawyer who has run on the platform of being pro-concealed weapons, anti-abortion, anti-union and anti-regulation. Once again at this hour, with 14 percent of precincts reporting, incumbent Democratic Senator Bob Wirch with 44 percent of the vote trailing his Republican challenger Jonathan Steitz with 56 percent of the vote. But these are early, early returns. Whichever of these candidates win tonight`s election, in District 22, the victory is going to be short lived -- thanks to the new redistricting plan that Wisconsin plan that Wisconsin Governor Scott Walker signed into law last week. Both of these guys, both of these candidates, the incumbent and his challenger, will be living outside the new District 22 after it is redrawn for the next election. And regardless of whether or not State Senators Wirch and Holperin hold or lose their seats tonight, Republicans will still be in control of the Wisconsin state Senate -- thanks to the results of last week`s recall elections. It has been a wild ride in Wisconsin this year. We will be right back and keep you posted as further results become available. (COMMERCIAL BREAK) (BEGIN VIDEO CLIP) MADDOW: (INAUDIBLE) has not worked at THE RACHEL MADDOW SHOW anymore. Anthony has left the friendly confines of this show and our silly hijinx for the much more sober journalistic duty of covering the presidential campaign as an embed on the campaign for NBC news. So, even though it looks like we were there in the spin room. (END VIDEO CLIP) MADDOW: I need to actually correct part of that. The producer I was discussing there, Antony Terrell has left this show, and he is an NBC News embed on the campaign trail. But what I got wrong there is when I said that in leaving this show, Anthony Terrell, great producer, has left his high jinx behind him. Watch. (BEGIN VIDEO CLIP) ANTHONY TERRELL, NBC NEWS: I`m here at the Iowa state fair. I am in line to get some fried butter. It`s 11:00 a.m. and this is going to be my brunch. Thank you. I`m really looking forward to this butter. (INAUDIBLE) I had to get a pop to wash it down with. I`m really thirsty. (INAUDIBLE) Let`s take a bite. Hmmm! UNIDENTIFIED FEMALE: What does it look like on the inside? TERRELL: A little bit of cinnamon. Some frosting on the interior. It tastes like a pancake, if you will. Very soft and gooey. I know my cholesterol levels are going to shoot up. (INAUDIBLE) TERRELL: Look at that. (INAUDIBLE) TERRELL: That`s a stick of butter. (LAUGHTER) TERRELL: Got to love the Iowa state fair. (END VIDEO CLIP) MADDOW: Anthony Terrell having his liquid, delicious frosting coated deep fried cake and eating too. Anthony`s complete lack of cynicism about every aspect of his job which is covering politics is the best new thing in the world today. Thanks for staying with us tonight. Now, it`s time for "THE ED SHOW." THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END