Tuesday, December 22, 2009

'Countdown with Keith Olbermann' for Tuesday, December 22nd, 2009
video podcast

Guests: Sen. Barbara Boxer, Ezra Klein, Wendell Potter, Eugene Robinson,

Richard Wolffe


LAWRENCE O'DONNELL, GUEST HOST (voice-over): Which of these stories will you be talking about tomorrow?

Just in time for Christmas.


SEN. ROLAND BURRIS (D), ILLINOIS: 'Twas the night before Christmas, and all through the Senate.


O'DONNELL: The Senate leadership reaches a tentative deal that will allow the full chamber to vote on the health care bill the morning of Christmas Eve. All so they can get home in time for the holidays.


SEN. HARRY REID (D-NEV), MAJORITY LEADER: Let's just all try to get along.


O'DONNELL: But are Republicans willing to reach an agreement on, say, saving the planet?




O'DONNELL: Or time for Republicans to plan their next obstruction.

After health care, the "party of no" takes aim at climate change.


MICHAEL STEELE, RNC CHAIRMAN: Don't come up in my face talking about I'm an obstacle and we're blocking this process.


O'DONNELL: Talk isn't cheap - not when it comes to the oratory stylings of RNC Chairman Michael Steele, whose full time job is basically to speak on behalf of the GOP. So, why is he hitting up the groups he addresses with a speaking fee?


REP. MICHELE BACHMANN (R), MINNESOTA: Michael Steele, you be the man.


O'DONNELL: And 2009 will be remembered as the year of the Countdown and just about everyone else saw Carrie Prejean in all of her glory.


CARRIE PREJEAN, FMR. MISS CALIFORNIA: They've tried to embarrass me. They've tried to humiliate me. They've tried to attack me. And I'm still standing.


O'DONNELL: Actually, she managed to do that all by herself.

All the news and commentary - now on Countdown.


PREJEAN: You're being inappropriate.



O'DONNELL: Good evening from New York. I'm Lawrence O'Donnell, in for Keith Olbermann.

America's largest union of registered nurses today came out against the Senate health care bill, saying it will make the health care crisis worse. So, perhaps, no surprise that in our fifth story tonight, Senate Republicans have gone from telling tea party supporters they will fight to the last to helping Democrats pass it faster.

Senate Republican Leader Mitch McConnell had once insisted that Republicans would force the debate to continue up to the last minute, Christmas Eve at 8:00 p.m., 9:00, or even later. But with the Midwest facing an ice storm that might play havoc with their travel plans, today, McConnell got his Republicans to agree to cut the bait short so they can all get going at 8:00 a.m. on Christmas Eve morning. This because they don't really care about the symbolic gesture any more, and they want to spend more time with their families, of course. Or just possibly, they don't want to endure any more debate after it reached this level today.


BURRIS: 'Twas the night before Christmas, and all through the Senate, the right held up a health care bill, no matter what was in it. Despite the obstructionist tactics of some, the filibuster had broken, the people had won. And a good bill was ready for President Obama ready to sign and end health care drama. The Democrats exclaimed as they rode into the night, "Better coverage for all, even our friends on the right!"


O'DONNELL: President Obama had already said he would stay in town, holding off departure for his Hawaiian Christmas until the Senate passage of the bill.

But today, NNU, National Nurses United, representing 150,000 registered nurses around the country, released a statement saying, quote, "Sadly, we have ended up with legislation that fails to meet the test of true health care reform, guaranteeing high quality, cost effective care for all Americans, and instead are further locking into place a system that entrenches the chokehold of the profit-making insurance giants on our health. If this bill passes, the industry will become more powerful and could be beyond the reach of reform for generations."

Joining us tonight from the Senate is California's Democratic Senator Barbara Boxer.

Great thanks for your time tonight, Senator.

SEN. BARBARA BOXER (D), CALIFORNIA: Great to be with you. Great to be with you.

O'DONNELL: Senator, the criticism has been pouring in from the left. I have joined in some of that criticism. You saw me on this network this morning on "MORNING JOE," joining in some of that criticism. You called me immediately afterwards to set me straight.

What are we missing? What needs to be said about this bill to liberal supporters of health care reform, supporters of universal coverage who are disappointed in this bill?

BOXER: Well, I want to talk to everybody, whether they're liberal or conservative. I think, you know, this is an issue that should join us together because when sickness strikes, it doesn't matter what your political philosophy is, Lawrence. And what we know is: that every single day, 14,000 Americans lose their health care. And 62 percent of bankruptcies are linked to a health care crisis.

So, we can't wait, we have to act. And I would love a perfect bill, and I think you well know that I supported the public option.

But I do believe, and I see it in Howard Dean, where he's backtracked from where he was totally opposed to this, if you look at this bill and you set aside all the rancor and all the money that's being spend on ads on both sides and everything else, we see that we are moving in the right direction. Because the minute this bill is passed, our seniors will be able to afford that prescription drug plan that they have. They won't fall into that doughnut hole.

Medicare will be extended nine-years. Medicare is a public option.

Medicaid, we're going to work our way up to taking in 14 million more people.

We'll be setting up exchanges, but before we do, there will be a high risk pool, so people who can't get insurance will be able to get that insurance.

And in 2011, which is pretty soon, it's going to be clear to the insurance companies that they have to only spend 15 percent of what they take in on their overhead, including their executive pay. I could go on and on.

The fact is, I look back to the debate on Social Security, on Medicare, and the echoes of those debates really filled the Senate chamber. And it's very, very similar. Why do we have to rush? We shouldn't do this, it isn't perfect. And those who didn't want to start Social Security and Medicare said the same things.

We are on a track to do something good for the people. I believe that in my heart. I wouldn't support it if I didn't think it.

And the insurance companies are spending millions to derail it. So, even though that nurses group - I don't know that particular group, I know there are many other organizations supporting it, including doctors - the fact of the matter is: the insurers are spending millions of dollars in opposition. So, I think we're doing the right thing here.

O'DONNELL: Senator Boxer, is there anything that can be improved in the Senate bill in conference?

BOXER: Oh, sure.

O'DONNELL: I mean, what Senator Nelson's saying, if you change anything, I'll vote against it. Is there any chance to improve anything in the conference?

BOXER: I don't think he's saying if you change anything. He had drawn the line in the sand at a few places. But I'll give you some examples.

I think there are a few things in this bill that are really important, such as the nonprofit plans that will be set up by the Office of Personnel Management. I think we should make the rules stronger for those groups that try to get into the exchange. These are things we can do.

Maria Cantwell has a terrific provision in this bill which gets (INAUDIBLE), where states will have the option to take the tax credits, which will go to a certain income level of folks in their state, and run a state plan, a public option.

So, yes, I think there are many ways. I've been talking to my friends on the House side. And I think we can improve it even more.

O'DONNELL: What about on the abortion provision, Senator? Is there anyway of changing the Nelson position? Or are we going to go more toward the Stupak position?

BOXER: Well, it isn't the Nelson provision, Nelson wanted Stupak. We were able to find a fair compromise that both sides are unhappy with, which I think says we did the right thing.

What did we do? We make sure there is a firm law between federal funds and private funds. And we have to do that because of the Hyde Amendment that says you can't mix in those funds. So, we set up an accounting procedure to do that. I think it's very fair.

I talked to my House colleagues. I hope that we can all come together.

O'DONNELL: California Democratic Senator Barbara Boxer - I really appreciate your coming on tonight.

BOXER: Thanks for having me.

O'DONNELL: "Politico" today reports that Washington lobbyists are having their biggest year ever, on track to spend more than $3.3 billion to lobby the federal government despite the fact Washington now has 1,500 fewer registered lobbyists.

Among the groups topping last year's totals are the drug group Pharma and the insurance industry group America's Health Insurance Plans, spending $6.3 million in the first nine months of 2009.

"USA Today" is reporting that Senator Dodd has received $210,000 in donations this year from health-related political action committees. His successor as health committee chairman, Tom Harkin, got $66,000. Max Baucus, whose committee wrote the model for the Senate's bill, has taken in $2.5, but that is since 2005.

Let's bring in Ezra Klein, who covers economic and domestic issues for "The Washington Post."

Good to have you join us tonight, Ezra.


O'DONNELL: Ezra, let's get to those numbers. And to be fair about those numbers, some of that money includes very strong supporters of health care reform who are participants in the health care sector also, who are being included in those numbers.

But what do we get in this general sense of the overall lobbying, spending that's going on in Washington, and how it has affected this bill?

KLEIN: You get what we're having on - essentially all issues now, which is the increasing lack of legitimacy in Washington's decisions. It isn't really that I think Chris Dodd was so taken in with what he was lobbied on, I think, you know, most of his opinions have been, you know, fairly good. It's.


O'DONNELL: Ezra, can we just stop there just for a second? To illustrate the point on Chris Dodd. No one in the Senate that I'm aware of has fought harder for provisions that the insurance companies do not want like the public option and other things.

KLEIN: Right.

O'DONNELL: Then Chris Dodd did, and he comes from the state where many of those insurance companies are housed. And so.

KLEIN: Exactly.

O'DONNELL: . it's not always clear that you can follow the money to influence that involves a quid pro quo.

KLEIN: But here's - but that gives you the exact problem, right? What you can do as you look at that money and you look at these outcomes and you say, this doesn't smell right to me. I think people in this country do it all the time.

And so, whether or not you want to make the argument that these guys were bought, or whether or not you want to make the argument that they just shouldn't be letting these folks into their office, there is a real procedural problem here. Until we get some serious campaign finance reform and some serious lobbying reform in this country, we're - none of this looks legitimate to the American people. And they're right to be suspicious of it.

I mean, when you hear - there's a great article, I want to say it was either in my paper or "The New York Times" a while back, about how Max Baucus' former chief of staff, they work for, you know, lobbying firms. And they can get into the office to talk to him, you know?

So, there's a real reason people look at this and they say, it doesn't

it doesn't make sense to me. And it's something I think the Senate and the House should be a lot more concerned about. You'd think they'd want people to view them more highly.

O'DONNELL: And with billions of dollars at stake in this sector, billions upon billions, for as far as the eye can see, $6 million in lobbying money doesn't sound like a lot to me. And it seems like there's been a pretty good return in terms of provisions in this bill that keep most of the players in the health care sector happy. Isn't that the way it looks right now?

KLEIN: Well, you know, I'd actually put it a little bit differently. What really mattered here was not the lobbying money that they used, both the money they held in reserve.

Take pharma, people were really afraid, I heard, from the beginning, of letting pharma go at this bill. And the reason is, unlike really the insurers or the device manufacturers, pharma is incredibly rich. They could blanket the country billions of anti-health care reform advertising, campaigning, without even noticing, without even blinking. They have so much money sitting back there.

They really - you know, people came in from the beginning, and they wanted to sit down, they wanted to make pharma. Make sure pharma was not going to go full bore at this bill.

So, it's just the lobbying. It's also the fear of the money these industries have. And, frankly, the big problem here is that it's a great investment for them. It's a lot of money for a senator or a group of senators to get 100 million bucks in lobbying. We didn't even let them get that, but if you somehow could.

But for these industries to get a good provision in this bill, they can get a return of 50 times, 100 times, 1,000 times that. So, we have hit a moment here where, you know, they've got a lot of money for our system, but our system controls a lot more money than that. So, it just makes good business sense to lobby Washington.

O'DONNELL: And if this bill passes, the enforcement for much of what's in the bill shifts to the states, it's delegated to the states. So, the lobbying then it seems to me, moves to the state, doesn't it, on these enforcement issues?

KLEIN: Some of it will, and I think you'll see a couple things. One is that, you know, you'll have these national plans, too. So, if things break down too much on the state level, you're going to see people flood into the national plans.

The other is it's just going to go state by state there. My state, my home state, California, is a very strong insurance regulation. Others don't at all. So, you know, I think that it is going to be easier for insurance to lobby in some states and others are going to be much tougher. And we'll sort of have to see how it plays out and how we have to fix it down the road.

O'DONNELL: Ezra Klein of "The Washington Post" - thanks for your insights tonight.

KLEIN: Thank you.

O'DONNELL: Up next: putting profits over people - insurance companies are already planning to gain the system to fight one of the few industry reforms to find its way into the health care bill. We'll tell you how.

And later, Republicans in the Senate prepare for their next act of obstructionism. Having watered down health care reform, they'll be targeting climate change next.

Stay with us.


O'DONNELL: Coming up: It's not as if the Senate health care bill is heavy on major reform to begin with, but insurance companies are already searching for ways to pretend they're playing by the rules. All to keep raking in record profits. We'll discuss how with insurance industry veteran, Wendell Potter.

That's next. This is Countdown.


O'DONNELL: It's called medical loss ratio: the amount of money insurers must spend on actual health care.

Our fourth story on the Countdown: It is in the Senate bill and insurance companies are already trying to manipulate it.

The bill will impose a medical loss ratio of 80 percent to 85 percent. Senator Jay Rockefeller had pushed for a 90 percent threshold and he tells "Time" magazine that customers have a right to know how much of their premiums are spent on administrative costs and advertising.

But as "SmartMoney" reports, the insurance companies already see a silver lining in the new MLR regulations. Carl McDonald, a health care analyst for the investment bank Oppenheimer & Company, "wrote in a note to clients that the number was workable for insurers, especially if they can label certain items that count as corporate expenses as health care for purposes of meeting the spending minimum."

Earlier this year, the Senate Commerce Committee investigated medical loss ratios, resulting in Aetna admitting it had misreported its revenues that overstated its MLR in the small group market. Aetna then amended its filing to reflect the actual numbers.

Joining me now is Wendell Potter, a former executive for CIGNA and current senior fellow for the Center for Media and Democracy.

Good evening, Wendell.


O'DONNELL: MLR, medical loss ratios. Now, what are the insurance companies thinking about how they're going to approach this new regulation on medical loss ratios?

POTTER: Well, just like they did two years ago in California when that state tried to reform its health care system, there's general agreement among the insurance companies that they could live with 85 percent medical loss ratio because they knew they could manipulate the numbers and they could define the terms. In other words, they could make it work for them by being able to categorize expenses in certain areas.

O'DONNELL: And this is - first of all - designed to cut into their profit margins. Will it do that?

POTTER: It can if there is significant regulation, and we have enough transparency. They need to disclose a lot more than they currently do. Insurance companies are notoriously stingy with information. And Senator Rockefeller's exactly right, we need to know, and we need to know in detail exactly what they're doing with their premium dollars.

And this is not just for the for-profit companies. Senator Boxer mentioned that we'll have nonprofits supposedly we'll be set up for the exchanges. They're not necessarily wearing the whiteheads, either. When I was in Nebraska last week, BlueCross and BlueShield of Nebraska put out one of those bogus surveys saying that the health care reform legislation of the Senate would drive rates up when they had just recently announced that they were going to be increasing one of their premiums to 34 percent.

I called and were sending them emails and asked them, what are their medical loss ratios. They don't report them. At least they hadn't to me.

O'DONNELL: And Senator Boxer has stressed to me that the medical loss ratios are very important piece of this legislation. And I agree that that is true and would be more true if we know exactly how it's going to be enforced.

POTTER: Right.

O'DONNELL: Does the bill indicate who comes to the insurance companies with what badge to enforce this medical loss ratio number on them?

POTTER: No, it's not clear to me. And there's a - and that's a very important thing. When you - we need to know who will be doing the regulating, who'll be defining the terms, who will be setting the rules, and I don't think that we have that clarity yet.

O'DONNELL: Is there anyone currently employed in the U.S. government, at the IRS, or in the HHS, who knows how to enforce this, how to go into an insurance company and figure out what their real medical loss ratio is?

POTTER: No, I don't think so. At least I haven't come across them.

One of the things that I have learned for the last six months is there's very, very little understanding in Washington about how commercial health insurance companies work, including on Capitol Hill. The exceptions are Senator Rockefeller and his team. I would say that his commerce committee team really understands this more than anybody else. But the people who get it are few and far between.

O'DONNELL: Yes, no question, Jay Rockefeller knows more about this than any other senator. But his team is not going to be able to go into those insurance companies and look.

POTTER: That's right.

O'DONNELL: He can have hearings. He can oversight hearings.

POTTER: Right.

O'DONNELL: But - let's just say enforcement works, even though we don't know how it's going to work. Let's assume for a moment enforcement works perfectly. I don't see what would then prevent the insurance companies from simply raising their premiums so that the overall revenues is higher, so that living with 15 percent administrative costs is pretty good money for them?

POTTER: And that's true, and because this legislation doesn't provide

any rate regulations, there's nothing really in the world to stop it. The

only thing that - there's the expectation that the market will create the

what is need to keep those rates from going up unnecessarily. But that's - they're all working in the system, this legislation doesn't really change the system. It's as good as we probably can get. But your premise is correct.

O'DONNELL: Wendell Potter, former executive with CIGNA Insurance and Countdown's invaluable guide to the health insurance industry - thank you very much for joining us tonight.

POTTER: Thank you, Lawrence.

O'DONNELL: Senate Republicans are putting their needs ahead of the planet's. Having done all they can to defeat the health care bill, the "party of no" is now planning to take down climate change next.

And later, RNC Chairman Michael Steele has been hitting up the groups he addresses for a speaking fee. Have fellow Republicans put a hit out on him?


O'DONNELL: Coming up: The gift that keeps on giving. RNC Chairman Michael Steele is using his position to market himself for paid speeches. He might not be doing anything wrong. So, why are people who have had that job before speaking out about the impropriety of it all?

And later, there was once a time when no one at Countdown had ever heard of Carrie Prejean - how a few choice words led the former beauty queen out of obscurity.


O'DONNELL: For the man who struck a Heisman pose on this network after Republicans under his leadership were wiped out in November's Congressional elections, the headline in today's "Washington Times" must have been tough to swallow: "Exclusive, Ex-RNC Chiefs Rip Steele's Speaking Fees."

In our number three story, when the Republican-worshipping "Washington Times" - "The Washington Times" gets three former chairmen of the Republican National Committee to bash Michael Steele, you know the Republicans are out for blood.

"The Times" says Steele, as RNC chairman, quote, "is using his title to market himself for paid appearances nationwide, personally profiting from speeches with fees up to 20,000 dollars at colleges, trade associations and other groups."

Steele is paid over 200,000 dollars a year for his RNC work. There are no rules prohibiting him from giving paid speeches. "The Times" cites a paid speech at a college in September and an upcoming Steele speech at Depaul University in Chicago. The RNC says "The Washington Times" report is silly. A spokesperson saying, quote, "many Democrat and Republican national chairmen have regularly received outside income."

That didn't keep three past Republican chairmen from going on record with their outrage. Among them, Jim Nicholson, a Bushie, and RNC chair during the late '90s who told "The Times" that Steele's job, quote, "demands so much of your time that you can work 24-seven and not getting everything done. So taking the time out to speak for the benefit of one's own bank account is not appropriate."

And of course Republicans weren't the only ones taking shots at Steele. Witness this exchange at today's Robert Gibbs press briefing.


UNIDENTIFIED FEMALE: Have you heard that the chairman of the Republican national committee twice yesterday said that the Democrats are flipping the bird at the American people?

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: How much did that interview cost?


O'DONNELL: Joining me now is Eugene Robinson, associate editor and Pulitzer Prize winning columnist for "The Washington Post" and MSNBC political analyst. Welcome, Eugene.

EUGENE ROBINSON, "THE WASHINGTON POST": Great to be here, Lawrence.

O'DONNELL: First of all, is there any real problem with Michael Steele doing paid speaking engagements if his employer, the Republican National Committee, has no rules against it?

ROBINSON: If by problem you mean is there any legal restriction on his giving speeches, apparently there's no rule against it at the RNC. So there's not that kind of problem. But, clearly, there is a problem in terms of how other prominent Republicans are viewing this. And, you know, the Republican party -

A lot of people in Washington give paid speeches. The problem, I think, is that the Republican party is supposed to stand for something. It's supposed to be an institution whose purpose is itself not to the aggrandizement of its chairman. So it's supposed to have loftier goals than that, I think. I think that's what people are reacting to.

O'DONNELL: Eugene, as a reporter, if you make phone calls to former party chairmen on a story where you are looking to see if they have anything negative to say about the current party chairman, in your experience, is it tough to get those phone calls answered? Is it tough to get those phone calls returned? Doesn't a former party chairman have to, in effect, very consciously go out of his way to give a negative quote about the current party chairman?

ROBINSON: Well, I think that's a very fair assessment. Those phone calls are very tough to get returned. And, actually, let's modify that. Let's say a Republican party chairman. Remember, this is a party that's kind of more buttoned down than the Democratic party. And the idea of not one or two - three former Republican party chairmen kind of jumping in and saying that, in their view, this is - this is not appropriate, it tells you something about the party now.

We al know there is an ideological struggle going on within the Republican party. I'm not sure this is all ideology, though. I think there simply are questions about Michael Steele's leadership and the direction he wants to take the party, if indeed there is a concrete direction in which he wants to take the party.

O'DONNELL: And these former chairmen know well how to run the Republican National Committee. There were early stories that have never quite been resolved about just how messy things were when Michael Steele took over there, just in terms of administrative duties and making the thing run correctly. They may be disgusted by that, the way that looks to them. But he also has this problem with the right wing of the party, where he has kind of said to the Tea Party people, come on, it's a big tent, Olympia Snowe is OK.

It seems like there's more than one reason why a former Republican party chairman might want to see Michael Steele replaced quickly at this point, doesn't there?

ROBINSON: Well, I think that's also fair to say, Lawrence. And, indeed, if you want to give - identify a Michael Steele philosophy, you could say he's for a big tent party. He talks about it a lot. It's unclear to me whether he's done a lot about it, but he talks about it.

At the same time, I don't think these three chairmen, former chairmen, are necessarily anti-big tent. They're not necessarily Tea Party folks. So there could be something personal going on here as well.

O'DONNELL: Gene Robinson of MSNBC and "The Washington Post," thanks for your time tonight.

ROBINSON: Great to be here.

O'DONNELL: Coming up, the party of no gets ready to say no to climate change legislation. Senator Lindsey Graham is leaking the playbook.

Later, Countdown's very special tribute to the year in Carrie Prejean.

Well, family hour special. We've got to keep it clean.

And when Rachel joins you at the top of the hour, her special guest, Governor Howard Dean to talk about the improvements he wants made to the health care bill.


O'DONNELL: Having inflicted some wounds on health care reform, Republicans are now threatening to block another major Democratic priority. Our number two story, the party of no reveals their next target: climate change legislation. Republicans are blaming the health care battle as reason not to back a climate change bill.

"Politico" reporting that after the partisan fighting, normally gettable Republicans are not lending their support. Susan Collins says cap and trade talks are stalled. Lindsey Graham, who has been working on a bipartisan bill, says in order for climate change legislation to pass, the climate in the Senate needs to change. It makes it hard to do anything because of the way this was handled.

With democrats split, the bill won't have much steam without backing from the GOP. But Senator John Kerry promises full steam ahead; "not a chance in hell that after the president put American prestige on the line in Copenhagen that the Senate is going to give this issue anything less than a major push. Congress is not a one trick pony, incapable of tackling more than one big issues. The cost of tackling climate change would only grow if the Senate got weak kneed and kicked the can down the road. Not going to happen."

But Senator Dick Lugar of Indiana says cap and trade talks have been delayed by the health care bill almost indefinitely. "The question will be how many more battles members of Congress want to take on in an election year."

Time now to call in MSNBC political analyst Richard Wolffe. He is also senior strategist at Public Strategies and author of "Renegade: The Making of a President."

Good evening, Richard.

RICHARD WOLFFE, AUTHOR, "RENEGADE": Good evening, Lawrence.

SCHULTZ: Is that line from Senator Lugar all we really need to know about where Republicans are in this legislation? They are not going to let this happen in an election year?

WOLFFE: Pretty much. It's not just Republicans, of course. Democrats are also deeply troubled by the prospects of the election next year. It is the ultimate in short-term thinking, what happens next year versus what happens to the long-term fate of the planet.

But there is another calculation. And this is the challenge for the White House and for their Democratic allies in Congress, is to convince Republicans that this isn't just about the planet or the economy or future technology, but there is this geopolitical game going on here.

Senator Kerry was right when he said the president put American credibility on the line in Copenhagen. Against that, China has been trying to box in America, trying to blame the collapse of everything on to American politics. And Republicans are playing into the hands of the Chinese that obstructed this whole deal moving forward.

So if they really want to help the Chinese out, let them grow, let them pollute, let them do whatever they like; they should just go ahead and just think about the election. But it's not helping them. It's not helping the country. It's certainly not helping the planet.

O'DONNELL: Now, Senator Kerry is absolutely right when he says the congress is not a one-trick pony. But haven't the Republicans become a one-trick pony and that trick is obstructionist?

WOLFFE: Oh, I think Congress is more of an old, tired workhorse than a one-trick pony. They say they can do two things in two years - two big things in two years, and then they're really tired and have to go away for a long break.

When you look at obstructionism, that's the kind of polite way to put it. What the Republican party really saw in President Obama was a mortal threat to their political future. A guy who could win Indiana, North Carolina and Virginia threatened to really transform American politics. So they had to make him unpalatable, unacceptable to any kind of moderate or any Republican or independent voter. That's what this is about.

It's not just saying no. It's making him seem extreme, making the whole agenda out of the mainstream. So obstructionism is a nice way to put it. I think it's much more extreme than that.

O'DONNELL: Now, Lindsey Graham has been viciously attacked by some Republicans for even thinking about working with Democrats on climate change. So doesn't that indicate that the Senate Republicans are really pushing toward party unity on this one, and there won't be any Republicans available?

WOLFFE: I think they may be able to pick off one or two for the Democrats. Maybe Lindsey Graham will come in with something. But they are putting a huge amount of pressure. And this kind of party unity has worked for Republicans. It has helped them rebuild themselves with their base. They've held together very well in the House.

But, from the start, this was happening. I mean, this is a party that voted entirely against the stimulus package that was going to bring money to their districts and states. If you're going to vote against money going to your districts and states to help people get jobs or to back into work or to deal with unemployment, then this stuff is just beyond the pale. I think party unity is going to be pretty easy for them at this stage.

O'DONNELL: Harry Reid has done a brilliant job of putting the 60-vote coalition of his caucus together on health care reform, just an astonishingly brilliant tactical job doing that. Is there any chance he can pull those 60 votes out of a hat on climate change?

WOLFFE: On parts of climate change, yes. You're going to see money going to, again, districts and states, things like technology. You can expect the coal states to be bought of with a supposed clean coal technology. But the cap and trade, the stuff that's going to impose costs on the economy - and even the president as a candidate said it would be costly - things that threaten to change the face of the economy, that stuff isn't going to survive. Technology and money, yes.

O'DONNELL: Richard Wolffe, many thanks.

WOLFFE: Thank you, Lawrence.

O'DONNELL: Still ahead, she used to be just your average beauty queen. But one question about gay marriage and a whole lot of sex tapes later, Carrie Prejean is above average entertainment.


O'DONNELL: When Miss California Carrie Prejean told a gay man at a beauty pageant that he shouldn't be allowed to get married, she showed up on the Countdown radar. When she put Keith Olbermann and Michael Musto in her lawsuit against the pageant that stole her crown, she was on the fast track to becoming a show favorite.

In our number one story, when word of a sex tape came out, Carrie Prejean was a lock for Countdown favorites of 2009. That whole program airs next week. Tonight, a sneak peek at Carrie Prejean.


OLBERMANN: When she told Perez Hilton she believed in opposite marriage, Carrie Prejean was prayed by the right for telling truth over the tiara. But when Miss California became opposite employed, the tiara suddenly stopped looking so bad after all.

Number one story. Carrie Prejean claims religious discrimination and sues, mentioning this program and MSNBC in the lawsuit. The man at the center of the controversy is Michael Musto. To analyze his precarious position, I'll be joined in a moment by Michael Musto.

But first, Carrie Prejean has filed lawsuit against Miss California Pageant Officials, citing slander, libel, public disclosure of private facts, intentional and negligent infliction of emotional distress, and religious discrimination, all of this stretching way back to Miss Prejean's original statement on gay marriage at the Miss USA Pageant in April.

CARRIE PREJEAN, FMR. MISS CALIFORNIA: We live in a land that you can choose same-sex marriage or opposite marriage. And, you know what, in my country, and in my family, I think that I believe that a marriage should be between a man and a woman.

No offense to anybody out there. But that's how I was raised, and that's how I think it should be, between a man and a woman.

OLBERMANN: Following that response, Miss Prejean was outed for using performance enhancers that the Miss California association had paid for. Topless photos of her surfaced as she discusses Satan and temptation with James Dobson. And less than a month after Donald Trump told her she could keep the crown, Miss Prejean was fired for contract violations.

Now comes a 23-page lawsuit. On top of page eight, 41, on April 30, 2009, "Prejean became the victim of a vicious attack by Michael Musto and Keith Olbermann on Olbermann's MSNBC program, during which they mocked Prejean, asserting among other vile things that she had had a sex change operation and needed a brain transplant."

If only we had some way of replaying all those vile things that were asserted in the vicious attack.

MICHAEL MUSTO, "THE VILLAGE VOICE": She sort of is like a human Klaus Barbie Doll. You tell Perez Hilton you're against gay marriage, it's like telling Simon Cowell you're against screeching a show tune. This is the kind of girl who sits on the TV and watches the sofa. She thinks the innuendo is an Italian suppository.

On the pageants now, they really should have easier questions, like what is your middle name or what show was Seinfeld on? This girl is a ding-dong. I didn't even like her earrings.

OLBERMANN: The moral in this is, what, never cross a beauty pageant official who knows you've had implants?

MUSTO: Yes, exactly, that's it. This has escalated to a public shaving. What Moakler has left out, Keith, is that they also paid for Carrie to cut off her penis, and sand her Adam's Apple, and a get head to toe waxing.

I know for a fact that Carrie Prejean was Harry Prejean, a homophobic man who liked marriage so much he did it three times. Now he's a babe who needs a brain implant. Maybe they could inject some fat from her butt? Oh, they have?

OLBERMANN: I didn't like her earrings. Joining me now, tonight's legal analyst, Michael Musto. How does it feel to be mentioned in a Carrie Prejean lawsuit? Is there pride, mixed with a kind of apprehension, mixed with a kind of what took her so long?

MUSTO: I'm thrilled, Keith. Not since last year, when Jackie Harry (ph) covered her face when she saw me have I gotten this kind of attention. I'm thrilled that she watches this show, not "Dora the Explorer" or "Real Housewives."

OLBERMANN: She has a book coming out in November. Presumably the lawsuit keeps her in the spotlight until then. Are you expecting that you will be - if you're in the lawsuit, will you be in the book?

MUSTO: I better be in the book. I actually got a sneak peek at the manuscript and she only refers to some guy who should not get married to opposite people, and also shouldn't wear polyester blend, because that's against the Bible, too. I consider that a mention.

OLBERMANN: And the end of Carrie Prejean. A sex tape from little miss preservation of marriage? Not same-sex, not opposite sex, just kind of mono-sex.

Carrie Prejean and the Miss California Pageant have these dueling lawsuits. She wanted a million dollars for wrongful dethroning. The pageant sought reimbursement for Prejean's breast implants. The sides appeared headed for court until, according to TMZ.com, pageant attorneys played, with Prejean and her lawyers present, an X-rated video of a woman engaged in some kind of sex.

The former beauty queen, confused, reportedly said, that's disgusting. Then the camera panned to reveal the face of the woman, and it was Carrie Prejean. Guess she forgot.

Red faced and caught red handed, so to speak, Prejean's demands changed from a million dollars to covering her legal fees. If she covered her legal fees, none of this would have happened.

Carrie Prejean goes on NBC and calls out me?

PREJEAN: If Sean Hannity went out there and said some of the things that Keith Olbermann has said about me - you know, if he said anything about Sonia Sotomayor or Michelle Obama, he would be off the air.

OLBERMANN: Hey, lady, first, you're not Sotomayor or Michelle Obama. Second, he's said worse about them than I've said about you. And, third, you made a sex tape that wound up being shown to your mother.

The free speech and first amendment rights of the dethroned Miss California Carrie Prejean have been so silenced, her freedom so denied that she's only done three national TV interviews in the last 24 hours, including one in the downstairs part of this studio.

Our number one story, did she leave any more of those personal videos hanging around?

PREJEAN: You can call it whatever you want to call it. If you want to call it a sex tape, that's fine.

UNIDENTIFIED FEMALE: What would you call it?

OLBERMANN: It was me by myself. There was no one else with me. I was not having sex.

UNIDENTIFIED FEMALE: There are people who say they want to call you on the carpet when they feel you're being a hypocrite. In your book you write, our bodies are temples of the lord. We should earn admiration and respect for our hearts, not for showing skin to look sexy.

PREJEAN: Absolutely.

UNIDENTIFIED FEMALE: Now people have seen this tape, whatever you want to call it, and they're saying, she's a hypocrite. She writes a book that says one thing.

PREJEAN: I'm a model. I was in a beauty pageant. I mean, if people want to call me a hypocrite, then that's their prerogative.

OLBERMANN: OK. If the tea is steady, Ms. Prejean, you're a hypocrite.

And the self destruction of Carrie Prejean, part 11 billion, the solo sex tape; she was 20 when she made it, says the guy she made it for. And it was one of many tapes.

And look what happened when Larry King tried to exercise his first amendment right to ask her about the settlement of her lawsuit.

LARRY KING, CNN ANCHOR: You took the mike off. If you put the mike on, we can hear.

PREJEAN: Yeah. I think you're being extremely inappropriate right now and I'm about to leave your show.

OLBERMANN: Look, Carrie Prejean is being silenced. Carrie Prejean's freedom of speech is being violated by that evil Carrie Prejean.

When you complain about the media trying to silence you and then you cut off your own microphone after a softball question from Larry King, you have just silenced yourself.

KING: So the agreement discusses the motive behind why each party agreed?

PREJEAN: Larry, you're being inappropriate. You really are?

KING: What?

PREJEAN: Larry, it was completely confidential and you're being inappropriate? OK.

KING: Inappropriate King Live continues.

OLBERMANN: Speaking of madness, do you find it ironic at all that the title of the book is "Still Standing." That, of course, is an Elton John song?

MUSTO: I heard she tried to get the rights to "Big Bottom Girls" by Queen and also "Sweet Transvestite" from Rocky Horror Show. She couldn't get the rights, so she went with a more mainstream gay artist. I'm leaving. This is inappropriate.

OLBERMANN: No, no. I'm leaving, it's inappropriate.

MUSTO: Let's both go. Let's go read her book.

OLBERMANN: That would be great television. Guest and host both walk off.

MUSTO: Yeah.


O'DONNELL: Countdown Favorites 2009 airs first Monday December 28, at 8:00 pm. Set your Tivos right now.

That will do it for this Tuesday edition of Countdown. I'm Lawrence O'Donnell, in for Keith Olbermann. Thanks for watching. Our MSNBC coverage continues now with "THE RACHEL MADDOW SHOW." Good evening, Rachel.