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The Rachel Maddow Show, Transcript 08/31/12

Guests: Donita Judge, Paul Krugman

RACHEL MADDOW, HOST: I`m definitely ready to go. About the sleep, I`m not sure. ED SCHULTZ, "THE ED SHOW" HOST: OK. Have a great weekend. Thank you. MADDOW: You, too. Looking forward to next week. It`s going to be great, man. All right. Thanks to you at home for staying with us for the next hour. We`re all a little bleary, but it`s sort of in a good way. You know what I mean? Like this is sort of a very exciting time of year if you`re into politics. We have reached half time of the great 2012 convention season. The Republican convention finishing up just last night in Tampa. The Democratic convention set to start on Tuesday in Charlotte, North Carolina. Now, campaigns in general, political conventions in particular, are a bit of an endurance sport, right? You give speech after speech. You give -- you shake hand after hand, you have to beg for money and whittle the press and manage leaks and put off fires. It`s exhausting. And whenever you think of the people at the center of this gigantic, sometimes hyper-produced events, these pure electoral spectacles, the people at the center of these things are just people, and people get tired. And when people get tired, they sometimes say things in a way they did not intend to say them. Witness Florida Republican Senator Marco Rubio, who did not get picked for vice president this year, but who did get the job of introducing Mitt Romney late last night in Tampa. Listen closely to how Mr. Rubio wraps up his big speech here. (BEGIN VIDEO CLIP) SEN. MARCO RUBIO (R), FLORIDA: Let us make sure they write that we did our part, that in the early years of this new century, we lived in an uncertain time. But we did not allow fear to cause us to abandon what made us special. We chose more government instead of more freedom. (END VIDEO CLIP) MADDOW: Did you catch that bit at the end? We chose more government instead of more freedom. We chose Mitt Romney. (BEGIN VIDEO CLIP) RUBIO: We chose more government instead of more freedom. (END VIDEO CLIP) MADDOW: Unless the Republican Party has gone reverse Galt on us, I think that Marco Rubio meant for that line to go the other way around. In fact, today, he said he meant for that line to go the other way around. He meant to say we chose more freedom instead of more government. He said we chose more government instead of more freedom. It was late. I totally understand what happened here. Then there was Congressman Paul Ryan, the vice presidential nominee, the guy who was supposed to sell the world on the big guy on the top of the ticket. Rip momny (ph), something? What was it? (BEGIN VIDEO CLIP) REP. PAUL RYAN (R-WI), VICE PRESIDENTIAL NOMINEE: It`s also going to be a speech where people get to know the man Rip Nomne (ph) better. (END VIDEO CLIP) MADDOW: Rim Nomne. Last night when the entire RACHEL MADDOW SHOW also could have used a nap, we had that clip on a permanent loop. I`m afraid my brain is now wired to say Rip Nomny. Rip Nomny, it`s just as easy to say. If I do that later tonight, I`m sorry. I very much sympathize with candidates who get tired. I mean, after three days of convention coverage, woke up this morning and looked at my alarm clack for several minutes with no idea what this thing was, trying to figure out why this thing I had never seen before was making this awful noise and what it wanted of me. No idea. All I had to do was cover the convention. Imagine how bushed these guys are who are in the middle of it. This is how Mitt Romney started this day today, the morning after the convention, with a sendoff in Lakeland, Florida. Again, listen closely to what he says here. (BEGIN VIDEO CLIP) MITT ROMNEY (R), PRESIDENT NOMINEE: We understand how Washington works. We will reach across the aisle and find good people who like us, want to make sure this company deals with its challenges. We`ll get America on track again. (END VIDEO CLIP) MADDOW: We`ll make sure this company deals with its challenges. This comp -- what? (BEGIN VIDEO CLIP) ROMNEY: We`ll find good people who like us, want to make sure this company deals with its challenges. We`ll get America on track again. (END VIDEO CLIP) MADDOW: America is not a company. And does that mean Mitt Romney wants to fire all of us? Like he fired workers at a lot of those businesses, Bain Capital bought so he could turn them around? So, you know, these guys -- these guys are tired. They`re all tired. But in politics, it doesn`t matter how tired you are. Really, it does not matter. I mean, after their respective conventions in `08, the Democrats and Republicans raced off to shake ore more hands and make more speeches. The last balloons probably hadn`t been pulled down from the ceiling and Barack Obama was in Pennsylvania and Michigan. And John McCain was in Wisconsin, in New Mexico, and Colorado, and Missouri. I mean, take a breath but keep running. Momentum is everything at times like this. That is usually how it goes. But after a day of campaigning that`s planned for Ohio and Florida with his running mate tomorrow, Mr. Romney is instead going to be taking some nap time. The weekend after the gigantic, hyper-produced, outsize, three-day-long marathon commercial for why the American public should fall in love with Mitt Romney and vote him into office, the Romney/Ryan campaign has a lot of empty space on it. They have no events announced for Sunday; they have no events announced for Monday. NBC`s political desk says actually they have no next events announced at all. Presumably, they will announce some before too long. But for right now, for the long weekend, the campaign appears to be more or less down for the weekend. At the very moment when campaigns try to rocket themselves to electability on the pure fuel of national attention and goodwill and rah- rah and buttons and donors wring checks, at that very moment when candidates usually race from the convention hall to tour the factories in swing states -- at that very moment that whole thing is finally fully incontrovertibly on, the Republican presidential candidate this year is heading for the porch and a glass of lemonade, but you can be sure he`ll turn this company around, Rip Monry. We don`t know yet whether the convention itself gave the Romney ticket a lasting bounce in the polls. The first poll results we have do not yet include today, Friday. So they may not factor in Mr. Romney`s speech -- for that matter, Clint Eastwood`s conversation with that chair late last night. This is Gallup`s daily tracking poll. It shows no change in the race. The Romney campaign got better news from another survey. Going into the convention, "The Reuters" poll had Obama leading Romney by four points. Partway through the convention, though, the same poll showed Mr. Romney up by the two, which is a six-point swing. A newer poll just out from "Reuters" today shows that he`s actually down to a one-point lead. So it`s not much compared to the 11-point bounce that John McCain got from his convention in 2008, but OK, you got six points, maybe you got five, at least in this one "Reuters" poll. That means you have some wind in your sails. It`s time to maximize, capitalize, turn this company around. Get on the bus, right? Choosing not to campaign like mad when you finally have momentum seems strange to me, especially for this campaign. I mean, the Romney campaign has operated so far with what looks to be a pretty sharp understanding of the math that goes into winning elections. They got to understand momentum, right? I mean, they surely understand geography. I mean, it`s not an accident that the party held its convention in Florida, which had not hosted a convention for 40 years, but which has voted for the winner of the presidential election almost every time for the past 40 years, and where Barack Obama now leads in the polls by an average of one single point. Republicans lost Florida last time but not by a lot. They would very much like to win Florida this year, putting the convention there was no accident. Since the `08 election, Republicans have passed laws in Florida that changed voting a lot in that state. For one, they cut the time for early voting. Also, the Republican governor in Florida has conducted a purge of the voting rolls. Last July, the Republican governor in Florida signed a law making it harder to hold the kind of registration drive for new voters. Voting rights activists at the time feared it would disproportionately affect minority voters who tend to lean Democratic and they appear to be proven right. This week, "The Florida Times Union" They released remarkable new analysis on voter registration in the state of Florida. We talked about this a little during the convention, but I think this is amazing. Have you seen this graph? So, coming into the `04 presidential election, that`s the time period before the `04 election, this is what the increase in voter registration looked like in Florida. Democrats in terms of registering new voters had an edge of 40,000 voters. In 2008, Democratic voter registration surged again, this is the work the parties are doing to register new voters. Now, for this election, starting in 2011, starting with the time when Florida Republicans made it harder to vote in the state, here`s what the comparable members are for this election? Oh. Republican voter registration, the red bars, they have carried on as normal. But look at the blue lines. Democratic voter registration has absolutely fallen off a cliff after these changes in Florida. By "The Florida Times Union`s" count, it is frankly practically disappeared. On Wednesday, on the second day of the Republican convention in Florida this week, a federal judge said he would permanently block Florida`s new law that makes it harder to register voters in the state. The law had been put on hold by a court in May, and the news this week, the new ruling means that the law is not coming back. And you know, looking at those numbers, look at `04 and then `08 and then 2012 in those blue lines. Maybe the damage is already done for Democrats. Maybe they cannot catch up. Or maybe they can if they try, if they move fast. The legal hurdles that explain why this graph happened in all likelihood, those are now gone. The Republican ticket is not taking up the space they usually would with a string of post convention rallies, right? So they had an opportunity here, especially after holding the convention there. They`re sort of petering out, taking the weekend off after Saturday? Maybe the other side`s ground game has a chance if they`re quick, if they think they can. I think what just happened in Florida is a bit of a test for Democrats. If they want to hold on to Florida, they`ve got a chance, but boy do they have to show voter registration game if they want to get it done. Also this week on the day Mitt Romney was nominated, yesterday, a federal court blocked a new law in Texas that required voters to show documentation in order to vote that voters never had to show there before. The federal court in Washington, D.C. said the placed, quote, "a strict, unforgiving burden on the poor." And in Texas, as in many places, the poor are often minorities, that matters in terms of the discriminatory intent behind the law. Texas Republicans have said they will appeal this ruling, but for now, it looks as though registered voters in Texas will be able to vote in November without the strict and unforgiving burdens of Texas Republicans` new law. Texas, of course, is not considered to be a swing state like Florida is, but to the extent more nonwhite Texans will be taking part in elections without barriers to them doing so, Texas frankly could be a swing state by 2016. At least the Democrats keep saying it could be a swing state by then. And a different panel of judges from the same court that made that decision about Texas, a different panel of judges from the same court is now considering whether or not to block the new Republican law that makes voting harder in South Carolina as well. So that is also potentially in flux. And more today, Friday, we have news today from Ohio, the swingiest swing state of all, where Republicans tried -- you will recall -- to cut early voting in half. They had to settle for cutting just the last three days of early voting. They had early voting on weekends and early voting on the last three days before the election in plenty of previous elections without trouble, including the primaries this year, but they tried to cut it off for November. Now, it looks like Ohio Republicans are going to have to settle for nothing at all, for no cuts to early voting. A federal judge ordered Ohio to put back those three days of early voting that the Republicans had cut. Not just put them back for overseas military voters, put them back for everyone. Almost 100,000 people voted during those last three days last time, and many of them were African-American Ohio voters. So the game just changed in some must-win states. To the extent that this campaign was going to come down to not just how well you politicked in these states, but how well the game had been rigged, the rigging has changed. And so this is a test, once again, of politics. Can Democrats take advantage of it by putting the states even more in play than they might have been able to before these burdens were taken away? Democrats and voting rights activists have pushed back against the Republican efforts to make voting harder in places like Ohio and in places like Florida and they are having some success. Vice President Biden stumped in Lordstown, Ohio, today. President Obama scheduled to show up Monday in Toledo, Ohio. We do have some idea what happens when you make voting harder. We do not yet know what happens this year when places who made voting harder suddenly make it easier again. Joining us now is Donita Judge. She`s lead attorney in Ohio for the Advancement Project, which supports voting rights. I should tell you, there`s so muff news out of Ohio that she was the lead attorney on another case decided in Ohio this week that says the state can no longer throw out your ballot if you accidentally vote in the wrong precinct. Ms. Judge, thank you for being here. It`s nice to have you here. DONITA JUDGE, ADVANCEMENT PROJECT: Well, thank you. It`s nice to here. MADDOW: You are involved in the intricacies of a lot of these -- of a lot of these matters. Let me ask you if I explain anything wrong about what`s been happening in Ohio? Did it seem roughly correct? JUDGE: Well, almost correct. MADDOW: OK. JUDGE: In Ohio, in terms of the provisional ballots, the provisional ballots that are cast in the wrong precinct due to poll worker error. MADDOW: OK. JUDGE: And that`s the huge distinction there. There were approximately 14,000 of those ballots that were thrown out in 2008. And so, now, the court has basically said, when a voter has done everything they possibly can, they have taken their personal responsible as Secretary Husted often says, they have registered to vote, they showed up at the correct polling place and then they`ve been directing to the wrong precinct through no fault of their own, you can no longer throw out those ballots. MADDOW: That had previously been the way that Ohio was operating, that even if it was no fault of your own, they told you to vote in the wrong place, that would result in your ballot being thrown out, but because of the case that you won this week, that will now be counted as a provisional ballot? That will now be counted as a proper ballot? How will that be counted? JUDGE: Well, it actually was a provisional ballot basically. A provisional ballot cast in the wrong precinct will not be thrown out if in fact it was poll worker error. Ohio law is very clear. The poll workers have the responsibility to direct voters to the correct voting place. They also have the responsibility to make sure their provisional ballot application is completed correctly. That`s another provision of the lawsuit that was just passed, that provisional ballots that do not have the signature in the right place or do not have their signature, or maybe left their name off but you can still determine who the voter is, you can no longer throw out the ballots. And that was a huge, huge win for Ohio voters and Ohio citizens because Ohio tends to cast more provisional ballots than any state in the country other than California -- something like 200,000 provisional ballots in 2008. MADDOW: Wow. In terms of the ruling today from the federal district court judge, there has been a hugely politicized fight over early voting in Ohio. We have sort of been tracking the twists and turns of it, including some seemingly very partisan terms in Ohio. If early voting has been restored in Ohio by this ruling, how much risk is that ruling at? Is there enough time between now and the election that an appeal can happen, or some other legal matter can happen that can stop this from going into effect? JUDGE: Well, I think there`s a good risk, as a matter of fact, as I was sitting here this evening, Attorney General DeWine has announced they will appeal this decision to the sixth circuit. MADDOW: OK. JUDGE: So there`s a huge possibility that, you know, we will be in court again fighting this battle. But again, we will urge the courts to really uphold the decision of the lower court that really protects the fundamental right to vote in Ohio and gives the Ohio voters an opportunity to vote in that last weekend where so many voters really came out and cast ballots. And disproportionately African-Americans were among those voters who voted that last weekend. And that`s a crucial weekend prior to an election to decide that you do not want to have early voting, and especially when you have had it previously. MADDOW: Yes. That`s the part of it I don`t understand. It`s not like there`s ever been a problem with early voting before, right? JUDGE: Right. No, there was no problem. But, of course, we had an opportunity to see in 2008 who came out to vote. MADDOW: That was the problem. JUDGE: That was the problem. That was the problem. MADDOW: Defined in partisan terms. I mean, this is -- here`s the issue about reporting on voting rights. So the voting rights stuff is so blatantly partisan when you step back and you realize it`s all Republican states doing this all in ways that tend to disenfranchise typically Democratic voters. But the arguments from the Republicans are always about this threat of voter fraud. And as much as you debunk the idea that voter fraud is a specter in our country looming over the elections that is affecting the outcomes, if they can find one case somewhere, one very hairy sounding allegation somewhere, they can sort of distract the argument with those claims. On early voting, that has nothing to do with even a red herring called voter fraud, right? Is there any practical argument against early voting that makes any sense from the other time that is not just about keeping Democrats away from the polls? JUDGE: No, there`s no practical argument, and what the laws are throughout the country are really the right wing politicians manipulating the voting laws because they know who is voting. And so basically, they have no real argument other than to throw up the red herring voting fraud and voter fraud may exist if in fact you`re manipulating -- or politicians who are manipulating elections, then there may be some issues and concerns there. But ultimately, you know, elections have to be free, fair, and accessible. And basically, that`s what these decisions said this week, is that the courts are going to uphold our democracy, and they`re going to uphold our fundamental right to vote in this country. MADDOW: Yes. And seeing it in Texas, seeing it pending in South Carolina, seeing it in Florida, seeing it in Ohio, and, again, all of these things are appeals, all of these things are still in process to a certain extent. Seeing democratic rights, in the most fundamental of all of our democratic rights supported in this way by the courts, it`s getting close to the election to have this up in the air, but it`s heartening to see this defense of the rights. You`re part of that. Donita Judge, thank you for being here. Donita Judge, lead attorney for the Advancement Project in Ohio -- thank you for your work and thanks for helping us understand it. JUDGE: Thank you very much for having me. MADDOW: Thank you. All right, so this thing calls Clint Eastwood happened. It definitely happened and it will certainly never happen again the way it did last night. As we carve that moment into the Mt. Rushmore of whackadoodle-ness in American politics, there`s actually something substantial to understand about what happened with the Eastwood debacle last night. It`s not about Clint Eastwood the person, it`s not even about what he said on stage. It`s about what it happened and what the implications are for the campaign. It`s kind of a weirdly serious thing. That`s coming up. (COMMERCIAL BREAK) MADDOW: The interview tonight is Paul Krugman. Stay tuned for that. (COMMERCIAL BREAK) MADDOW: Here`s the thing about Clint Eastwood that went so badly wrong for the Republican Party and the Mitt Romney campaign last night. It`s the timing. The campaign, the party obviously, they want maximum political impact from their nominating convention. To get maximum political impact, they need maximum exposure. They need a ton of people watching, right? I mean, the conventions don`t really do any work anymore. They`re just three-day long infomercial parties for the party and the candidate. And when they are showing off their candidate and putting him in the best possible light, that is the key to this whole event. That`s what they want tens of millions of Americans to see on TV. Now, the broadcast networks do not cover the conventions all that much. Cable networks like us, we cover it all day and all night, pretty much. But as much as we like to think of ourselves as the center of the universe here on cable, the truth is that the great bulk of the audience that sees the conventions sees it when the broadcast networks put it on -- NBC, CBS, and ABC. That`s where millions and millions and millions of people are watching. And in particular, millions of people are watching who aren`t otherwise interested in politics. It`s just what`s on. The networks put the convention on typically for one hour a night, 10:00 p.m. Eastern is that hour. So like NBC aired "Saving Hope" from 9:00 to 10:00, but then at 10:00, they switched over to the convention. On ABC, they aired something called "Rookie Blue" from 9:00 to 10:00, and then at 10:00, hey, "Rookie Blue" watcher, now it`s convention time. So, because the one hour the network show is the 10:00 p.m. hour, the big speeches at the conventions are scheduled for that 10:00 p.m. hour. Every year since the 1980s, that golden, priceless broadcast network coverage of the nominee for president giving his speech, every year for nearly 30 years, that broadcast coverage and that particular hour has included a heartwarming video introduction of the candidate, and these things are great. I mean, if you like political ads, these are the best political ads on earth. They sort of look like documentaries, but they`re ads, and they`re note perfect. They`re letter perfect -- to make the country love the candidate, and to make you at least want to stick around to hear the candidate`s big speech. Even the candidate introduction films from the bad campaigns are good candidate introduction films. This is good stuff. This is the best the campaign can do. And so, this has become sort of the way you do this in politics. In the magical 10:00 p.m. single hour of coverage that you`ve got with all of the broadcast networks, you get in maybe an introductory speech by someone else, maybe you do that. You get in the candidate speech itself, but it`s key, it is what the whole week is for. It is key. You also definitely in that hour, get in the video. Last night, the Romney campaign did not get in the video. And we knew ahead of time they had planned it that way. And it seemed like a bizarre decision even before we understood why they were doing it. (BEGIN VIDEO CLIP) MADDOW: All right, here`s what we know about the order of business. We`re sort of going up the on ramp onto the main event here. What is due to happen right now is a video, which we think is a video tribute to Mitt Romney. Here`s why I`m saying where think and it seems weird because as far as I understand the order of business, it`s video followed by mystery guest, spoiler alert, it`s Clint Eastwood, followed by Marco Rubio, followed by Mitt Romney. Doesn`t the video always go right before the nominee as the inspiring thing? We`re not going to have a video to get us psyched about Clint Eastwood, are we? It wasn`t. It was a video to get us psyched about Mitt Romney. It was a good 10-minute introduction video for Mitt Romney that was really well done. Really might make you like him even if you didn`t like him already or haven`t been paying attention and you just fell asleep for a second at the end of "Rookie Blue." They had this done, ten-minute film, but they did not air it during network coverage, so most people did not see it. It was done by the time the networks started covering the convention. They had scheduled it to run before the networks were switching over to convention coverage, for a specific reason. They did that in order to make room in the golden hour, in the network coverage hour for this instead. Look. To be announced. Their big surprise, a to be announced speaker. A surprise, wow, and then of course, they blew the surprise. Word about who it was going to be leaked out a day early so there was no suspense at all about who the suspenseful speaker was going to be. But even without the added value of the suspense, apparently they thought it was going to be so good, this speaker was going to be so good, it was worth putting this on during network coverage of the final night of the nominating convention instead of the beautifully produced note perfect, emotional introduction of the candidate they had ready to go. Instead, they did this. (BEGIN VIDEO CLIP) CLINT EASTWOOD, ACTOR: So Mr. President, how do you handle -- how do you handle promises that you`ve made when you were running for election? And how do you handle -- how do you handle it? What do you say to people? Do you just -- you know, I know people are wondering. You don`t, you don`t handle it, OK? Somebody had a stupid idea of trying terrorists in downtown New York City. Maybe that would work. I`ve got to hand it to you, I`ve got to give credit where credit is due. You did overrule that finally. And so now, we`re moving onward. I think that Mr. Romney and Mr. Ryan are two guys who can come along. I`m speaking out for everybody out there. Thank you. (END VIDEO CLIP) MADDOW: So the whole thing where he is addressing Mr. President, an empty chair sitting next to him, the empty chair bit, him interviewing the empty chair as if in the empty chair was President Obama, and then he was pretending that the invisible president in the chair yelled at Mr. Eastwood he should go F himself and to shut up. That was like the big -- that was the big joke. So that`s what the Romney campaign chose to broadcast to 25 million people about Mitt Romney`s campaign for the presidency. What they did last night is a political disaster. This is unheard of. These are the Mitt Romney campaign strategists who could conceivably be responsible for this. Eric Fehrnstrom, Stuart Stevens, Russ Schriefer, and the campaign manager, Matt Rhoades, who technically is responsible for everything, so I guess it`s his fault ultimately. An exasperating senior adviser to the campaign was asked by "The New York Times" who was responsible for the Clint Eastwood disaster. The response was, quote, "not me." Continuing from "The Times" -- in late night interviews, aides called the speech strange and weird. One described it as theater of the absurd. These are Romney staffers saying this about the thing that happened in the last hour on network television of their nominating convention that they have presumably be working on for years. So who is responsible for this? How did this happen? Continuing from "The Times," a senior Republican involved in convention planning said that Mr. Eastwood`s appearance was cleared by at least two of Mr. Romney`s top advisers, Russ Schriefer and Stuart Stevens. And then later in the day, Stuart Stevens himself threw the candidate under the bus. Stuart Stevens telling BuzzFeed that Mitt Romney loved the Clint Eastwood thing, quote, "I was backstage with him and he was laughing and he enjoyed it," Stevens said. Adding that the candidate thanked Mr. Eastwood for coming. This is not about Clint Eastwood. This is about the Romney campaign blowing their biggest moment in the campaign so far. The biggest audience they will ever have to present their un-rebutted best case for their campaign. If nobody gets fired for this, what does that say about who is in charge over there? (COMMERCIAL BREAK) MADDOW: This week in Tampa, the Republican Party was like the grapes of wrath at an occupy protest and the inscription at the Statue of Liberty all mixed up into one. After this week, the Republican Party should no longer be called the GOP, the Grand Old Party. It should be called the PHM, the party of the huddled masses. (BEGIN VIDEO CLIPS) ANN ROMNEY, MITT ROMNEY`S WIFE: My dad got his first job when he was 6 years old. MIKE HUCKABEE: My dad never finished high school. TIM PAWLENTY: Dad was a truck driver. GOV. CHRIS CHRISTIE (R), NEW JERSEY: Dad grew up in poverty. PAWLENTY: My dad lost his job. CHRISTIE: Mom also came from nothing. HUCKABEE: Working poor parents in a meat packing town. UNIDENTIFIED MALE: As a widow with seven children. ANN ROMNEY: Basement apartment. UNIDENTIFIED MALE: Tiny, two-bedroom house. ANN ROMNEY: Pasta and tuna fish. CHRISTIE: Single mother. Working class. UNIDENTIFIED MALE: Working class. CHRISTIE: Came from nothing. RYAN: She got on a bus. CHRISTIE: Took three different buses. RYAN: Every weekday for years. CHRISTIE: Everyday to get to work. UNIDENTIFIED MALE: Cleaning sheep pens. UNIDENTIFIED MALE: A poor farm boy. UNIDENTIFIED MALE: Working on the railroad. ANN ROMNEY: A Welsh coal miner. BOEHNER: Mopping floors, waiting tables, tending bar. CHRISTIE: They both lived hard lives. GOV. SUSANA MARTINEZ (R), NEW MEXICO: Paycheck to paycheck. MAYOR MIA LOVE (R), SARATOGA SPRINGS, UTAH: Ten dollars in their pocket. UNIDENTIFIED MALE: Making 50 cents an hour. SEN. RAND PAUL (R), TEENAGER: A teenager with nothing, not a penny. (END VIDEO CLIPS) MADDOWE: You know, give them a break. If you`re nominating Thurston Howell for president, you`d make your convention sound like that, too, right? Distract, distract, distract. But the Republicans did not just play the opposite game on the issue of class. And the subject of Mitt Romney`s money. They also did it on the subject of your money as well, and your fate, particularly if you`re an old person or somebody who plans to be an old person some day. That story is next with Paul Krugman. Stay with us. (COMMERCIAL BREAK) MADDOW: It is best not to lie. Obviously, for moral and ethical reasons, it`s best not to lie. But one of the practical reasons it`s better to tell the truth than it is to lie is because if the thing you`re saying is not a thing that actually happened, if you have to make something up, if you have to concoct a story in order to explain something because it`s not true, you`re committing yourself forever to remembering what that story is that you just made up. I mean, the truth is just the truth. You never have to give it a second thought, but a lie is something you is to remember forever or you will get caught. So you create a pneumonic device to remember it, do you write the lie on your hand to remind you, get a tattoo? Remember a lie your entire life is a difficult thing to commit yourself to. Now, in politics, in terms of lying, it`s one thing to get away with little explanatory lies and exaggerations nobody is going to ask you again. Everybody expects those from politicians. Maybe you can get away with those. But if a fundamental thing in your campaign, if a main pillar of what you`re running on is a lie, then that`s a problem, because not only do you have to remember what the lie is, but so does everybody else. If you`re a national campaign, you have a ton of surrogates, a ton of other people, a ton of elected officials trying to get you elected and they`re all going to be asked about this thing that is a main pillar in your campaign and what you`re banking on if it`s a lie is everybody remembering the same lie -- for months, for years, forever. What are the odds that`s not eventually going to fall apart if people are going to be asked about it every day? And a lot of people are asked about it every day. Today, it just fell apart a little more for Mitt Romney and Paul Ryan when Republican House Majority Eric Cantor forgot what the lie was. The lie in question is that the Republicans think it is awful that President Obama is cutting $700 billion out of Medicare. This is a lie because Paul Ryan has called for the exact same cuts to Medicare. So clearly, they do not think they`re so bad. Somebody forgot to remind Eric Cantor of how exactly you explain that lie. Asked ability the inconsistency of Ryan attacking cuts his own plan embraced, Mr. Cantor said, quote, "The assumption is that, uh, the, again - - I probably can`t speak to that in an exact way so I better just not." He said. Eric cantor forgot the lie. What screwed Eric Cantor up there, what he could not remember, the appropriate lie about is what Nobel Prize winning economist Paul Krugman called the smaller lie of the Republican campaign on the issue of Medicare. The small lies that Mitt Romney and Paul Ryan on Medicare are denouncing this policy that Mr. Ryan himself has proposed. That`s the small lie. But what Paul Krugman says is the big lie is this. (BEGIN VIDEO CLIP) RYAN: Medicare is a promise, and we will honor it. A Romney/Ryan administration will protect and strengthen Medicare. (END VIDEO CLIP) MADDOW: if you were running a son of a zillionaire, second generation zillionaire presidential candidate as your nominee this year, you would have a convention that was all about your party`s up from the boot straps story, right? Single moms, and poor immigrants working multiple jobs. And if you were running the kill Medicare guy as your vice presidential nominee, you too would have your convention about how much you love Medicare and want to protect it. But as Paul Krugman writes today, quote, "The Republican Party is now firmly committed to replacing Medicare with what we might call voucher care. The government would no longer pay your major medical bills, instead, it would give you a voucher that could be applied to the purchase of private insurance. If the voucher proved insufficient to buy decent coverage, that would be your problem. Over time, the Republican plan wouldn`t just end Medicare as we know it. It would kill the thing Medicare is supposed to provide: universal access to essential care." That, I think, even Eric Cantor could remember. Paul Krugman joins us for the interview next, in just a moment. (COMMERCIAL BREAK) (BEGIN VIDEO CLIP) RYAN: Medicare is a promise, and we will honor it. A Romney/Ryan administration will protect and strengthen Medicare. (END VIDEO CLIP) MADDOW: Paul Ryan as the spokesperson for protecting Medicare. Joining us now for the interview is Paul Krugman, Nobel Prize winning economist, Princeton professor of economics and international affairs, and, of course, a "New York Times" columnist. Mr. Krugman is a contributor to "The Occupy Handbook," which I own both in hardback and now in paperback because it`s just out in paperback. Paul, thanks for being here. PAUL KRUGMAN, NEW YORK TIMES: Hi, there. MADDOW: Politically, the Republicans say they have fought the Medicare issue to a draw. They don`t have political liability on the issue because they have convinced people President Obama would hurt Medicare more than they would. On policy terms, what`s your reaction to that? KRUGMAN: Well, yes, it`s amazing. I mean, they might be right on the politics, but in policy terms, of course not, right? I mean, Obama is proposing some cost saving measures, which are also exactly the same cost saving measures that Ryan assumes in his budget. And then, of course, Obama is trying to preserve Medicare as what it is, which is something that guarantees essential health care to older Americans, which we should have for everyone, but anyway, at least for older Americans, it`s a right. Republicans are saying we`ll give you a voucher and you can deal with the insurance company. It`s your problem. MADDOW: In terms of the political allegations back and forth, one man cost savings pressures are another person`s dastardly cuts. In terms of the substance of what President Obama is proposing, do you think there`s anything wrong with it? KRUGMAN: No, I mean, if you actually look at it, the cost saving measures are not -- no benefits are cut. Benefits are expanded. They`re all reductions in payments to insurance companies and hospitals. On the insurance company side, it`s reducing overpayments. There`s a program that has turned out to be a huge boondoggle -- very small benefits, in return for a lot of taxpayer costs. So they`re going to say we`re going to stop subsidizing that. And then the hospitals would be paid less, but they have agreed to that. The hospital industry said, you know, we`re going to have more patients because people will have insurance. We`ll have fewer uninsured people who have to be treated without being able to pay their bills, so we`re willing to accept slightly lower rates. So, this was a perfectly reasonable way to save a fairly modest amount of money over the next 10 years. Amazing that this has become -- well, it`s because Republicans are so good alt making people think they`re going to take away your money and give it to those people. If you look at it on its own merits, it`s a totally reasonable set of modest cost reduction measures. MADDOW: And they`re winning on the politics because what we`re talking about what Obama did on Medicare and not what Paul Ryan proposal, to voucherize it. KRUGMAN: That`s right, and I don`t know if it will last. But in any case, the amazing thing, that statement, we`re going to keep the promise of Medicare. The promise of Medicare is if you have a medical emergency, if you have necessary treatment, it will be paid for. And that promise is explicitly taken away. The promise instead is, we will give you some money that maybe will help you to buy an insurance policy from a private insurance company. That`s not the promise of Medicare. MADDOW: In terms of the economics of a voucher proposal like that, in human terms it`s harm to imagine. I imagine myself 88 years old, and I`m going to get a coupon and go shop on the private market for insurance because I`ve got a discount coupon. So, then maybe somebody will want to pick me up as an 88-year-old pensioner, to get private of insurance. It`s hard to imagine on human terms. But in economics terms, is there any reason to believe that putting people into the private market with some sort of government subsidy like that would be more efficient and bring down costs in a big is sense? KRUGMAN: This is amazing thing, because this is a case where conservatives and not just the extremes ones, but especially the extreme ones, just won`t take no for an answer. We have lots of evidence, we have lots of head to head comparisons of private insurance versus government programs. And the private insurance always ends up being more expensive. You can see that we`ve got Medicare Advantage which is running Medicare through private insurance companies, turned out to be a money- losing proposition for the taxpayer. We have Medicaid versus private insurance. You have a lot of head to head comparisons. Medicaid is a lot cheaper. And, of course, there`s the international thing. Every other advanced country relies much more on government provision of health insurance than we do. Every other advanced country has much cheaper health care than we do with no difference in quality or in some cases better quality. So you look at -- it`s not like you have to go to Timbuktu to find this out. Go a couple hundred miles north to Canada. Over the last 40 years, Canada has had much lower growth in health care costs. They spend not much more than half as much per person as we do. Same health care outcomes as we have, socialized health insurance. What more do you need? MADDOW: Yes, this is -- it works country to country. It works comparing two different systems within the same country. It even works comparing the private part of Medicare to the public part. KRUGMAN: There is not one example that I`m aware of that shows what Republicans insist we should be the belief on, which we completely overhaul our Medicare system. MADDOW: The Democrats will have done their job next week if what we are talking about with regard to Medicare is the voucher idea of Paul Ryan`s. Paul Krugman, "New York Times" columnist, Nobel Prize winning economist, and contributor to the new paperback version of "The Occupy Handbook" -- thanks, Paul. It`s nice to see you. KRUGMAN: Good to see you. MADDOW: Thank you. All right. So Republicans obviously wish the term legitimate rape and the man who said it would be scrubbed from this election cycle. They wish that enough to be introducing jokes now about murdering him. It`s very awkward but that`s next. (COMMERCIAL BREAK) MADDOW: Texas governor Rick Perry was at the Republican convention this week, theoretically to support Mitt Romney for president. But these comments did it not help. (BEGIN VIDEO CLIP) CHUCK TODD, NBC NEWS: Would you ever do this again? GOV. RICK PERRY (R), TEXAS: Oh, absolutely. I think the process. TODD: You might run for president someday again? PERRY: Well, you know, there`s a long time till 2016 and a lot of good things can happen my plan is for Mitt Romney to win and for him to get this country back on track. I`ll keep running the best state in the nation. (END VIDEO CLIP) MADDOW: Wait, 2016? That means Mitt Romney is going to win and then you`re going to primary him after his first term or you think he`s going to lose and you`ll be ready -- you`re telling reporters that at Romney`s convention. Oh, Rick Perry, you were not a good candidate but you are an even worse surrogate. That said, it was Rick Santorum, the de facto Republican runner-up from the primaries who actually got a speaking gig at the convention. Mr. Santorum thankfully used a teleprompter and therefore gave a very good speech that was very well-received. No single line of it was more well- received than this one. (BEGIN VIDEO CLIP) RICK SANTORUM (R), FORMER PRESIDENTIAL CANDIDATE: I thank God that America still has one party that reaches out their hands in love to lift up all of God`s children born and unborn. (APPLAUSE) (END VIDEO CLIP) MADDOW: Big applause. That big demonstrable show of enthusiasm for not just Santorum but for Rick Santorum talking about abortion, talking about criminalizing abortion. That was one of the breakthrough moments for social issues at this whole convention. Republicans were very careful to stay away at the convention from the party`s newly uniform hard-line stance on social issues. They have prioritized it so much in governing over the last couple of years, but they do not want to talk about it when it comes to the presidential race. So, yes, there was that Rick Santorum line. There was one line from Mike Huckabee in his speech. There was a six-word sentence from Mitt Romney in his speech and oblique reference to the God of life from Paul Ryan. Otherwise, they kept away from all social issues and especially from plans to criminalize abortion. Most of all, though, Republicans did not want it talk about Todd Akin, the Missouri senate candidate who last week upended the political narrative of the Republicans heading into their convention when he said this. (BEGIN VIDEO CLIP) REP. TODD AKIN (R), MISSOURI: If it`s a legitimate rape, the female body has ways to try to shut that whole thing down. (END VIDEO CLIP) MADDOW: Although the Republicans were seemingly pretty undisciplined when it came to most of their messaging this week, take for example the fact that most of the major speeches were not at all about Mitt Romney, a little undisciplined about that, but they were capital "R" rigorous. And on message when they stayed away from the Todd Akin issue. And it largely worked this week. People were not talking about Todd Akin. He was largely out of the news cycle by the time the convention even started. Until a reporter for "Businessweek" sort of snuck into a briefing for zillionaire mega-donors to Karl Rove`s super PAC held at the convention. Because that reporter was there we got quotable details how Rove and Hailey Barbour are making the hard sell to donors about what Senate seats they think are winnable for the Republicans and why they aren`t using the word "socialist" in their ads against President Obama. Some fascinating detail. If you want to read it, we have posted it linked it at "MaddowBlog" tonight. Here`s the giant political screw-up from that event where they didn`t think reporters were present. (BEGIN VIDEO CLIP) REPORTER: On Todd Akin of Missouri, Rove clearly wants him out of the race. The goal is to get other donors to pressure some of his donors an get him out of the race. He used pretty colorful language in there. I believe he said we should sink Todd Akin. If he`s found mysteriously murdered don`t look for my whereabouts. (END VIDEO CLIP) MADDOW: Murdered. Congressman Akin`s office responded to Mr. Rove today, saying they were disturbed by the murder comments but they were sure he misspoke. Then Mr. Rove called Todd Akin to apologize and Mr. Rove reportedly told Mr. Akin he would never had said such a thing if he had known there was a reporter in the room -- I`m not kidding. That`s reportedly the form his apology took. Sorry I meant to back stab you. I never would have let you know I was back stabbing you. I don`t front stab. But just like that, thank you, Karl Rove. Todd Akin and Republican abortion extremism back in the news, just in time for the convention bump. There are just a few more weeks in which Todd Akin can legally drop out of the Missouri Senate race, as Republicans would like him to do. There`s no sign he`s going to drop out and there`s no sign this issue is going to go away before the election either, because it`s not the Democrats making this up and raising it as a distractions. If you`re the party of Rick Santorum and Todd Akin and Paul Ryan and the Republicans are, this is going to keep coming up no matter who you tell a bunch of billionaires you might like to murder, Karl. That does it for us tonight. We will see you again Monday night. But now it is time for "Mitt Romney: The Making of a Candidate." Have a great time not being in prison tonight. Good night. THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END