Wednesday, January 27, 2010

Two episodes for this date.
Click to go directly to:
Pre-speech, 8 PM
Post-speech, 10:30 PM
'Countdown with Keith Olbermann' for Wednesday, January 27th, 2010 - 10:30pm
video podcast

Guests: Chris Matthews, Rachel Maddow, David Shuster, Anthony Weiner, Howard Fineman, David Axelrod

KEITH OLBERMANN, MSNBC: The president versus the big banks, the big insurers, big unemployment. Daring the Republicans not to join him as he challenges those tasks, those individuals and others. The question, as we rejoin you to Rachel Maddow and Chris Matthews, will the Republicans take the dare and if so, if they don't cooperate, Rachel, will the American public side with the president or with the reaction against incumbents that we have seen heretofore in this administration?

RACHEL MADDOW, MSNBC: Keith, I think that it depends on whether we believe that speeches change things. And I've never been one of those people that does stupid body language analysis politics. But if there is body language to read in this, to watch the Republicans side of the chamber sitting stiffly, refusing to applaud, refusing to even acknowledge the president, the fact that the president was giving a speech for much of the night, at the beginning of the speech, by the end of it, frequently getting to their feet, frequently applauding the president and not all of them all at once, sometimes being led by different Republicans but a little Republican resolve seemed to be wilting tonight just over the course of the speech. We will see. We will see if that holds, if that translates into legislative action.

OLBERMANN: Chris, did you see that, too? W as that kind of a box-in maneuver in which you make an opposition agree to things that are obvious and fundamental? Did the president pull off a little bit of a political -

I don't know, full-court press?

CHRIS MATTHEWS, MSNBC: It wasn't rope-a-dope, I'll tell you that. It was much more positive and much more seductive. I agree completely. I think the turn came around when he asked them about the third or fourth time are they going to join him on health care and I think they were aware of how they would look if they hadn't joined him at that point. I don't think that the camera work was that good tonight. It was - pretty, but it wasn't useful. They weren't - it wasn't close enough in on them I thought. Rachel picked it up. I picked it up a little bit. But I think -

I do think he was so blithe, so totally open to a bipartisan approach, to a past (INAUDIBLE) in this country or past stupid partisanship, I think it's going to be very hard for them to come on later tonight and take shots at him. I think at least tonight he will win the argument for getting together. Tonight he will, I think. I agree with Rachel.

OLBERMANN: Did he - obviously to some degree and I don't know that this would be emphasized by the White House but to some degree this was about getting the audience back in show business terms. Do you think he did that?

MADDOW: Well, I think that - I said before the speech that I didn't think there would be a lot to excite the base. I think that's true in policy terms. I think what the base will like and what people in the middle and moderates might like is the sort of playful feistiness of his tone. He definitely had a little combativeness to it but with a smile. That sort of I won't quit ending I think is going to appeal to a lot of people in tone. In terms of the actual policies that he put forward, Chris is right. The way that - you are right, Keith in your analysis, that the way he got Republicans to start standing up is by asking them to cheer for things like oh, tax cuts or the basic idea of health reform. Other things that, I think, sap some of the anti-Obama talking points that the right has used against them. He just didn't seem all that left wing tonight in the policies that he put forward.

OLBERMANN: On the other hand Chris, he did call out the Republicans

and the use of the 60-vote or the need for the 60-vote super majority and

he also - when they scoffed at the idea of this limited domestic spending

freeze taking effect next year, he ad-libbed since we have a copy of the

advance - he ad libbed that line about that's how budgeting works which -

got a big laugh. I mean, complimentary. But there were two masters were being served in this speech. Whatever he was trying to drag bipartisanship along and out of and at the same time, there was - there were still a few shots taken that might have been for the benefit of the base or just for the benefit of his own presidency.

MATTHEWS: No. He is pretty sharp on defense. In fact he's ready (ph) to swat back. That was a swat back right at them. You guys ought to know that we budget for next year. That's what you do for a living. You pass the budget. That's what you do. You can take your cheap shot at me for not cutting right now but we are setting a budget for FY '11. I'll tell you what the headline in the "Wall Street Journal" is going to be tomorrow. He's cutting off the tax cuts at the end of their period. He's going to let them sunset as they say in Washington. They are going to pick that headline up. He may have buried it in there, no more tax cuts for the better off after this Bush run is over. I think that's going to be a lead. I mean the jobs thing bugged me because it was only $30 billion. That's one quarter of 1 percent of our GDP. I would like to see rapid rail. I would like to see Moynihan's station opened in New York. I'd like to see an entire continental train system put together at high speed. But he didn't do that. He began the - I think people are going to think that's a boutique look at rapid rail compared to the rest of the world.

OLBERMANN: As we wait for the Republican response which will come from the new governor of Virginia, Bob McDonnell in a matter of minutes, four minutes hence is the scheduled time, the bottom of the hour roughly. Rachel, there was - there was a lot in here about something we addressed earlier whether or not there would be a - class warfare but the idea of Main Street versus Wall Street comparison, a contrast that he made moments into this speech. I'm wondering if that - if that's the takeaway here from the average American watching this tonight, that OK, this guy, maybe he is on my side no matter what his politicians say and what the opposition politicians say.

MADDOW: That was an early moment in the speech and my note on that was ready made campaign ad. At this point in the speech, Republicans not standing up, not saying that they will support the fee on the banks to get them to pay back the bailout money. To put that stuff up there, I felt like at the start of the speech it was going to be a much more partisan speech than it was. Because he did really box in the Republicans and make them look very anti-populist by them not supporting the bank fee and not supporting paying back the bank bailout. Are you kidding? Not supporting, Republicans not standing and supporting his proposal, a long-standing proposal that has been out there forever to take away the subsidies for businesses that offshore their jobs. Those are all very populist measures, Republicans not supporting them. And I think the president putting them on a spot by making them demonstrate that with their lack of applause.

OLBERMANN: Indeed Chris. At one point he said we all hated the bank bailout. He was not necessarily talking about or to the Republicans. He was talking past them and past you and I and Rachel.

MATTHEWS: Well, thank God he said that because everybody does. You know, I was trying to think about who he was tonight. And it is interesting. He's post-racial (ph) by all appearances. I forgot he was black tonight for an hour. He has gone a long way to become a leader of this country and passed so much history in just a year or two. I mean it's something we don't even think about. I was watching. I said wait a minute. He is an African-American guy in front of a bunch of other white people and here he is president of the United States and we've completely forgotten that tonight, completely forgotten it. I think it was in the scope of his discussion, it was so broad ranging, so in tune with so many problems and aspects and aspects of American life that you don't think in terms of the old tribalism, the old ethnicity.

It was astounding in that regard, a very subtle fact. It is so hard to even talk about it. I shouldn't talk about it but I am. I thought it was profound that way. I think in terms of the seduction tonight, I don't think he did anything tonight out of love for Republicans or deep understanding of people who disagree. He's probably incredibly frustrated by the failure of a single Republican senator to step up and say we got to do something about health care. I'm challenging my caucus on this one. I'm with you, buddy. I'm a profile in courage. Not a single Republican. That's got to frustrate a guy who has tried to reach out. He's willing to go for tort reform. He's willing to take on the trial lawyers I believe if he can get a dozen Republicans, even half a dozen to join him. He wants bipartisanship. They have decided to close the door on bipartisanship.

I watched Cornyn tonight, watch the chairman of their campaign committee, watch that chuckle face on McConnell tonight. He's chuckling away because he thinks the just say no party can win big this November. And unfortunately he may be right. That would not be a good vote by the American people, that just for a party that sits on its keister and chuckles during a very bad recession. Unfortunately that may be smart politics. But you know what, as they say in the "Godfather," the smart move gets you garroted sometimes. You know Clemenza would have done, it was the smart move, but you know what happened to Tezio. The smart move got him killed. So I - sometimes I like the people to think they (INAUDIBLE) we can't avoid "Godfather" conversations.

OLBERMANN: Conveniently the Republican response is going to take us out of the "Godfather" conversation in a matter of seconds and we go to the state house in Virginia for that newly elected governor. It appears as you see in front of a live audience which is a staging improvement for the Republicans after Bobby Jindal's speech a year ago. Here is Governor Bob McDonnell of Virginia.

GOV. BOB MCDONNELL (R), VIRGINIA: Thank you very much. Thank you.

Good evening. I'm Bob McDonnell. Eleven days ago, I was honored to be sworn in as the 71st governor of Virginia. I'm standing in the historic House Chamber of Virginia's Capitol, a building designed by Virginia's second governor, Thomas Jefferson.

It's not easy to follow the president of the United States. And my 18-year-old twin boys have added pressure to me tonight by giving me exactly 10 minutes to finish before they leave to go watch "SportsCenter."


I'm joined by fellow Virginians to share a Republican perspective on how to best address the challenges facing our nation today.

We were encouraged to hear President Obama speak this evening about the need to create jobs. All Americans should have the opportunity to find and keep meaningful work, and the dignity that comes with it.


Many - many of us here tonight - and many of you watching - have family or friends who have lost their jobs. In fact, 1 in 10 Americans is unemployed. That is unacceptable.

Here in Virginia, we've faced our highest unemployment rate in more than 25 years, and bringing new jobs and more opportunities to our citizens is the top priority of my administration.

Good government policy should spur economic growth and strengthen the private sector's ability to create new jobs.


We must enact policies that promote entrepreneurship and innovation so America can better compete with the world. What government should not do is pile on more taxation, regulation and litigation that kill jobs and hurt the middle class.

It was Thomas Jefferson who called for "a wise and frugal government which shall leave men free to regulate their own pursuits of industry and shall not take from the mouth of labor the bread it has earned." He was right.

Today, the federal government is simply trying to do too much. Last year, we were told that massive new federal spending would create more jobs immediately and hold unemployment below 8 percent.

In the past year, more than 3 million people have lost their jobs, and yet the Democratic Congress continues deficit spending, adding to the bureaucracy, and increasing the national debt on our children and our grandchildren.

The amount of debt is on pace to double in five years and triple in ten. The federal debt is now over $100,000 per household. This is simply unsustainable.

The president's partial freeze announced tonight on discretionary spending is a laudable step, but a small one. The circumstances of our time demand that we reconsider and restore the proper limited role of government at every level.


Without reform, the excessive growth of government threatens our very liberty and our prosperity.

In recent months, the American people have made clear that they want government leaders to listen and then act on the issues most important to them. We want results, not rhetoric. We want cooperation, not partisanship.


There is much common ground. All Americans agree that we need health

health care system that is affordable, accessible, and high quality.

But most Americans do not want to turn over the best medical care system in the world to the federal government.

Republicans in Congress have offered legislation to reform health care, without shifting Medicaid costs to the states, without cutting Medicare, and without raising your taxes.

And we will do that by implementing commonsense reforms, like letting families and businesses buy health insurance policies across state lines and ending frivolous lawsuits against doctors and hospitals that drive up the cost of your health care.

And our solutions aren't 1,000-page bills that no one has fully read, after being crafted behind closed doors with special interests. In fact, many of our proposals are available online at, and we welcome your ideas on Facebook and Twitter.


All Americans agree that this nation must become more energy independent and secure. We are blessed here in America with vast natural resources, and we must use them all. Advances in technology can unleash more natural gas, nuclear, wind, coal, alternative energy that will lower your utility bills.

Here in Virginia, we have the opportunity to become the first state on the East Coast to explore for and produce oil and natural gas off-shore.


But this administration's policies are delaying off-shore production, hindering nuclear energy expansion, and seeking to impose job-killing cap-and-trade energy taxes. Now is the time to adopt innovative energy policies that create jobs and lower energy prices.


All Americans agree that a young person needs a world-class education to compete in the global economy. As a young kid, my dad told me, "Son, if you want a good job, you need a good education." Dad was right, and that's even more true today.

The president and I agree on expanding the number of high-quality charter schools and rewarding teachers for excellent performance. More school choices for parents and students mean more accountability and greater achievement.

A child's educational opportunity should be determined by her intellect and work ethic, not by her ZIP Code.


All Americans agree that we must maintain a strong national defense. The courage and success of our armed forces is allowing us to draw down troop levels in Iraq as that government is increasingly able to step up. My oldest daughter, Jeanine, was an Army platoon leader in Iraq, so I am personally grateful for the service and sacrifice of all our men and women in uniform, and a grateful nation thanks them.


We applaud President Obama's decision to deploy 30,000 more troops to Afghanistan. We agree that victory there is imperative for national security.

But we have serious concerns over the recent steps the administration has taken regarding suspected terrorists. Americans were shocked on Christmas Day to learn of the attempted bombing of a flight to Detroit. This foreign terror suspect was given the same legal rights as a U.S. citizen and immediately stopped providing critical intelligence.

As Senator-elect Scott Brown has said, we should be spending taxpayer dollars to defeat terrorists, not to protect them.


Here at home, government must help foster a society in which all our people can use their God-given talents and liberty to pursue the great American dream. Republicans know that government cannot guarantee individual outcomes, but we strongly believe that it must guarantee equality of opportunity for all.

That opportunity exists best in a democracy which promotes free enterprise, economic growth, strong families, and individual achievement.

Many Americans are concerned about this administration's effort to exert greater control over car companies, banks, energy, and health care, but over-regulating employers won't create more employment, overtaxing investors won't foster more investment.

Top-down, one-size-fits-all decision-making should not replace the personal choices of free people in a free market, nor undermine the proper role of state and local governments in our system of federalism. As our founders clearly stated, and we governors clearly understand, government closest to the people governs best.


And no government program can ever replace the actions of caring Americans freely choosing to help one another. The Scriptures say, "To whom much is given, much will be required." As the most generous and prosperous nation on Earth, it is heartwarming to see Americans giving much time and money to the people of Haiti.

Thank you for your ongoing compassion.


Some people say they're afraid that America is no longer the great land of promise that she has always been. They should not be.

America will always blaze the trail of opportunity and prosperity. America will - must always be a land where liberty and property are valued and respected and innocent human life is protected.

Government should have this clear goal: Where opportunity is absent, we must create it. Where opportunity is limited, we must expand it. Where opportunity is unequal, we must make it open to everyone.


Our founders pledged their lives, their fortunes, and their sacred honor to create this great nation. Now we should pledge as Democrats, Republicans and independents - Americans all - to work together to leave this nation an ever better place than we found it.

God bless you, and God bless this great land of America. Thank you very much.

OLBERMANN: The Republican response to the State of the Union from Governor Bob McDonnell of Virginia.

And here is - I think this is the problem with the staging as much of an improvement as that scene is over past ones. He has been governor for 11 days and nationally nobody knows who he is.

Perhaps more importantly, he - only other individual he quoted in there was a senator who's elected last week and no one knows who those other people are. It creates something of a disconnect and one substantive one.

Chris, let me just ask you this quickly. Will we ever get a response, either given by a Republican or a Democrat under whatever circumstances, that actually addresses what was said in the previous speech?

MATTHEWS: No, because they refuse to do that. And this is true of the Democrats who are in power as well. Neither party has a person capable of reading a speech and reacting to it.

I don't know why they don't do it. It would be dynamite in news production. It would go right to the news cycle and we'd all be reporting it. There's nothing there that's news.

OLBERMANN: Let me ask.

MATTHEWS: There's nothing to report.

OLBERMANN: Let me - I couldn't agree more with you. Let me switch back to Rachel in our last minimum and a half because there was something that took about 35 seconds of the president's State of the Union address tonight.

And it has monumental import and I would like you to address it in our final minute or so.

The very, sort of, under-the-radar, low-key announcement that he is pushing to repeal Don't Ask, Don't Tell in the military.

MADDOW: We're going to have Lt. Col. Victor Fehrenbach addressing that in person tonight in my show this hour. And I'm very much looking forward to hearing his take.

The president in the past pledged to repeal Don't Ask, Don't Tell. He said as a candidate he'd do it in first year. He did not make that. He's made that pledge personally to Lt. Col. Fehrenbach, as one of the people facing getting kicked out under that policy.

Those who want to get rid of this policy really hope that this means there's going to be some new fire in the White House for pushing for it. John McCain tonight already releasing a written statement saying he opposes the repeal.

OLBERMANN: Rachel Maddow who will be back in one hour with a live edition of "THE RACHEL MADDOW SHOW" at 11:45 p.m. Eastern to which we encourage you to watch, and Chris Matthews, who has been with us before and after tonight's speeches.

I thank you both. It's always a pleasure.

MADDOW: Thanks, Keith.

MATTHEWS: Good night, Keith.

OLBERMANN: And a live post-State of the Union Countdown special edition starts now.

Good evening again from New York. Every American president having used some variation of the phrase to declare that our union is strong but at the conclusion, President Barack Obama's first official State of the Union address at the end of his first year in office exactly how strong is it.

With more questions tonight about the strength of the president's resolve to carry through on the policies he campaigned on and try to accomplish in his first year, especially health care reform.

The president tonight reaffirming his desire to pass health care legislation without presenting any game plan for getting it done. Not mentioning it until 32 minutes in. Other than mentioning that putting of the burden of passing a bill on Congress.


OBAMA: I didn't choose to tackle this issue to get some legislative victory under my belt. And by now it should be fairly obvious that I didn't take on health care because it was good politics.

Here's what I asked Congress, though. Don't walk away from reform. Not now. Not when we are so close. Let us find a way to come together and finish the job for the American people.


OLBERMANN: In fact, accomplishing his entire domestic agenda seeming to require, according to the president, a desire by Congress to want to change. This on a night in which the Senate majority leader could be seen yawning and Republicans for the most part sat on their hands as the president proposed imposing a fee on banks that handed out big bonuses after American taxpayers had bailed those banks out.


OBAMA: But what frustrates the American people is a Washington where every day is Election Day. We can't wage a perpetual campaign where the only goal is to see who can get the most embarrassing headlines about the other side.

A belief that if you lose, I win.

Neither party should delay or obstruct every single bill just because they can.


OLBERMANN: President asking for another change in tone when it comes to any discussion of American national security. A topic that took up a good chunk of the latter part of tonight's speech.


OBAMA: I know that all of us love this country. All of us are committed to its defense. So let's put aside the schoolyard talks about who is tough. Let's reject the false choice between protecting our people and upholding our values.

Let's leave behind the fear and division and do what it takes to defend our nation and forge a more hopeful future for America and for the world.


OLBERMANN: Among those seated was the first lady in the visitor's gallery, the woman from Pennsylvania who met the president when he toured a jobs training site that had gotten stimulus money and a man from Arizona whose company received $99 million from the stimulus and used it to create at least 50 permanent clean energy jobs.

Tonight, the president calling for, in effect, a second stimulus act in the form of a new jobs bill. Yet, as was leaked earlier this week, the president also calling for a three-year discretionary domestic spending freeze.


OBAMA: Starting in 2011, we are prepared to freeze government spending for three years.


OBAMA: Spending related to our national security, Medicare, Medicaid, and Social Security will not be affected. But all other discretionary government programs will.

Like any cash strapped family, we will work within a budget to invest in what we need and sacrifice what we don't. And if I have to enforce this discipline by veto, I will.


OLBERMANN: When the GOP scoffed about that taking place next year the president adlibbed, "That's how budgeting works."

The man who delivered the Republican response, the brand-new Virginia governor, Bob McDonnell, saying that the spending freeze is not big enough and big government itself is too big.


GOV. BOB MCDONNELL (R), VIRGINIA: The president's partial phrase announced today on discretionary spending is a lot of a step, but a small one. The circumstances of our time demand that we reconsider and restore the proper limited role of government at every level.


OLBERMANN: Joining us now, live from Capitol Hill, David Axelrod, senior adviser to the president of the United States.

David, good evening.


OLBERMANN: I characterized this earlier as the president versus big banks, big insurers, big unemployment, and essentially daring the Republicans not to join him.

Would you accept that characterization?

AXELROD: Yes. And at the end of the day, it's the president on the side of making this economy work for - working people and middle class people, people who want to be middle class, who've been going backwards even before this recession, who've been devastated by it.

And that's something that's motivated him throughout. But you're absolutely right. One of the big questions is whether it's one thing to stand up and applaud at a State of the Union speech, it's another thing to get off the sidelines and actually participate in solving the problems of this country.

That's the president's challenge to the Republican Party. And one hopes they'll do it.

I think, Keith, everybody out there is desperate for a little less politics and a little bit more action here in this town. We've done a lot on our own. Now they are bragging that they've got the 41st vote in the Senate and that they can stop anything with the president said tonight is fine.

Now you have a responsibility for governing. And if you want to turn these initiatives down, then you have to answer to the American people.

OLBERMANN: Did you see anything hopeful in that? Rachel Maddow was commenting that although she's not a big believer in body language it did seem that as this speech went on, the Republicans, whether by choice or by realization that they were no longer reacting to essentially being in favor of longer life and more money for everybody, began to loosen up a little bit and seemed to join in on some of the - at least the more obvious points.

Was there something, never mind political, but genuinely hopeful in that to you?

AXELROD: You know I'd like to believe that there is an element in everyone who runs for public office, an element of the patriotism and element of public spiritedness that says, you know what, we're all here to get a job done and a lot of what the president talked about shouldn't really be matters for dispute.

You know I heard Governor McDonnell say in his speech that, you know, we Republicans have solutions on health care. We want to allow insurance companies to sell insurance across state lines.

Well, you know what, that's in the Democratic bill. Apparently he wasn't told that. But perhaps if he knows that that's in the bill he'd be more supportive of it.

So I - you know, I - I don't know what to - I mean, it is my hope that we can find some cooperation in this year to get some things done for the American people. We got big problems. But, you know, we'll have to wait and see.

OLBERMANN: What is your assessment of the president's success at - for want of a better term - getting the audience back to whatever degree he did not have them in the last few weeks or months? Did you think this succeeded and to what degree was that a goal?

AXELROD: Well, look, the State of the Union is a great opportunity and an unparalleled opportunity for any president to speak to the country to talk about where we've been and where we're going.

And the president took great advantage of that tonight. Now I think people have a clear sense of what's motivating the things that he's doing about where his priorities lie for the country. And I think they are very much the priorities of people across this country, who want this economy to work better, obviously, and get people to work, but also to raise wages, to bring more security to the middle class.

They want to see a change in the way Washington works. So that we push back on the special interests. We have less of this sort of obstructionism and more constructive - you know, not always agreement. We're not always going to agree.

As he said, look, there are different views here. And that's democracy. But what we shouldn't have is one party taking the position that somehow if we stopped everything, or if we get off on the sidelines and things fail, if the country fails, that's a victory for them.

That's a - that's not what the American people want.

OLBERMANN: Last question, David. Did you feel any regret - do you know if the president felt any regret that it was in 32 minutes before the term health care reform was included in the speech when it was such a focus of his previous address to.

AXELROD: Well, the previous address he made was specifically on the health care issue, Keith.


AXELROD: This was a State of the Union speech. Understand that health care is one of those forces that are pressing down on middle class people and pressing down on our economy.

What the president did tonight was talk about all those things, whether it's jobs, or - you know, education, training, and health care, retirement, security. All the things that are factors in how we build a better life for people in this country and how we get this economy moving again.

And I don't think anybody could have seen that speech and left thinking boy, he's moving away from that issue. It was a priority for him. As you said, there's no great political capital in going - no great political prize in going after it.

This is something that thwarted seven presidents. And so we knew that it would be hard but he felt that it was important for the American people and important for our future. He still does and he's going to keep - he's going to keep trying to get the extra yard.

OLBERMANN: David Axelrod, the White House senior adviser. Great, thanks as always for your time, sir. Thank you. Good night.

AXELROD: It's good to be with you.

OLBERMANN: My pleasure.

Time now to turn to Howard Fineman, senior Washington correspondent for "Newsweek," and political analyst for MSNBC.

And, good evening again, Howard.


OLBERMANN: Not to fixate solely on health care on this, but clearly, health care were she a singer went from soloist to chorus tonight. No way to look at it otherwise, is there?

FINEMAN: Yes. And as a matter of fact, the president said hey, if you've got a better idea let me hear it. That was a rhetorical device. But even joking about reopening negotiations on the whole thing probably made supporters of health care nervous.

Now I know I have been admonished by the president of the United States not to indulge in sound bites because I'm a TV pundit, but I'm going to now indulge in one.

If presidential leadership were only about giving speeches, the jackhammers would already be at work on Mt. Rushmore. I thought the guy dominated the room, used humor, occupied the middle ground. It was both theatrically very good. Playing in the hall much better than it read on page. Tactically quite smart.

Keith, this was one of the most conservative speeches that leaving aside the fact that the - some of the Bush tax cuts will lapse and some of the other features in there, by and large, talking about tax cuts, stressing tax cuts, talking about spending freezes, talking about the virtues of the - the free enterprise and the economy.

In many, many way this is one of the most conservative speeches that a Democratic president has given since, I think, the middle of Bill Clinton's time. And it was tactically quite smart on the president's part and in his tone which was all sweet reasonableness designed, as Rachel said, to force the Republicans to stand up as they eventually did.

I thought it was - it was very, very well done. It really left the Republican governor of Virginia very little to say. He didn't have too much say to begin with.

OLBERMANN: In point of fact, first, I want to observe this is the problem with political pundits. I thought he was talking about me. You thought he was talking about you.


OLBERMANN: And I'm sure Chris thought he was talking - yes, everybody is like, he just mentioned me in the speech.

He did mention something and it got less - was a - it was a 10-second item and it was the only - it then turned out to be the only substantive thing in Mr. McDonnell's response. It was the prospect of offshore drilling which.


OLBERMANN: Which the governor really emphasized as if he didn't even notice that the president opened the door to offshore drilling.

FINEMAN: Yes. Exactly.

OLBERMANN: That's how.

FINEMAN: Exactly.

OLBERMANN: This is a bipartisan request. We need to rework the response process so that the fellow giving the response, whether it's a Democratic president or a Republican one, or some other party in the next century, that they've actually - the guy giving the response has actually listened to the speech.

FINEMAN: Well, you know, this is not by accident. The people in the White House politically are not dumb. They knew that McDonnell had won in Virginia. They knew this other Republicans are winning.

I think in a way President Obama tonight tried to take off the table and by getting Republicans to stand up or making the governor of Virginia's remarks irrelevant, most of the things in the middle of the spectrum. And also the tone of it was carefully slightly apologetic, you know, yes, I screwed up some things, I can do better. But.



FINEMAN: It was overall the tone of it was remarkably reasonable and commanding. And I think will do a lot to restore at least the sense that the guy - you know, has a game in hand.

Now, it's a big difference, as Rachel was saying and Chris was saying, between saying all that and tactically occupying the ground rhetorically, and actually forcing the Republicans and some Democrats to vote for some of these things.

Barack Obama desperately needs a legislative victory of some kind. I know he's waving his hand away about that. But he hasn't won anything in a long time. And he really needs to win something off of this really good speech.

OLBERMANN: Howard Fineman of "Newsweek" and MSNBC.

To expound on what you said, in fact, he said I take my share of the blame about the health care situation. So we were talking beforehand about the difference between health care - between blame and responsibility. He went with blame.

FINEMAN: Yes, he did.

OLBERMANN: Great thanks, Howard.

FINEMAN: Thank you, Keith.

OLBERMANN: How did congressional Democrats in the House chamber react to the president's message tonight? We'll find out some of that from Congressman Anthony Weiner.

Also getting an early read on the White House plan to jump-start the economy. That and the latest headlines from the phone tampering scheme at the office of Senator Mary Landrieu in Louisiana.


OLBERMANN: We are joined now from Capitol Hill by Representative Anthony Weiner, Democrat of New York. In the wake of the president's State of the Union address.

And, Congressman, I'd like to play one part of this which might be for all the talk of "don't ask, don't tell" and a limited talk about health care, jobs creations is the number one focus of 2010, one thing that might be the headline for the average American watching.

Here's the clip first.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We recovered most of the money we spent on the banks.


OBAMA: Most but not all. To recover the rest, I proposed a fee on the biggest banks. Now.


OBAMA: Now, I know Wall Street isn't keen on this idea. But if these firms can afford to hand out big bonuses again, they can afford a modest fee to pay back the taxpayers who rescued them in their time of need.



OLBERMANN: Congressman, one of the early themes of this speech was - seemed to me - Wall Street versus Main Street, with the president on the side of Main Street. Did he tap into something with the American public's point of view at the moment?

REP. ANTHONY WEINER (D), NEW YORK: Well, if one of the primary things the president needed to do in this speech is make it clear, you know, that we get it, we understand the challenges that people are facing, we are trying to solve them - the president did that from the moment the speech began and right throughout, and especially with that point.

You know, he made it very clear - he could have come into the speech kind of woe is me and we are in a kind of tough situation, I'm sorry. Instead, he leaned in and made it very clear he's going to lead this agenda going forward.

And those of us in Congress are very pleased to hear that.

OLBERMANN: There was at both ends of the spectrum, I thought, he went for a lot of bipartisanship and calls for an end to partisanship, and at the same time, he called out the GOP in the Senate for refusing to agree to anything and called them, essentially, the party of no. He mocked those who laughed when he said that limited budget freeze wouldn't be until 2011 by saying that's how budgeting works.

There was - it was a neat hair to split, I thought, in that sense.

WEINER: Well, yes. It was a great speech in that he made it clear when his values were and that he wasn't going to abandon the face of what has been persistent Republican opposition in just about every turn. And he also did it with a smile on his face, which I think drove a lot of my Republican colleagues a little crazy.

He also reserved some jabs for an institution that deserves it, and that's the United States Senate. I think five times he said the House has passed important initiatives and, boy, wouldn't it be great if the Senate went ahead and did that, too.

So, he, really, did do an excellent job tonight.

OLBERMANN: He did not abandon his principles and yet 32 minutes of that speech went by before a phrase and you I have discussed several times in the last few months was even mentioned: health care reform.

How did you feel about how health care reform, as I've just said to Howard Fineman, seemed to have gone from the soloist to a member of the chorus?

WEINER: I am fine with it. Look, the most important thing is that we were at, kind of, a dividing point here. He had to decide whether he was going to say, basically, health care is dead, or health care is still something he is going to fight for. He said he's going to fight for it and I take him at his word.

Now, if this is the end of conversation and he's not in there really trying to get this past and making clear to the American people that we need things like the public option, closing the doughnut hole and the like, then, obviously, I'll be wrong. But he had a choice here and leaned forward into health care. I'm satisfied. Now, we're going to watch for the follow-up.

OLBERMANN: What did you think of the Republican responses to all of these outreaches and less so, although he did ask, said if anybody had a better idea than what's been proposed from either party, he'd be happy to hear it. That, I guess, counts as an outreach and a lot of the other ones were much more specific to the Republicans. It did, in fact, seem like for the first few topics in which this area, this concept was raised, the Republicans sat on their hands but, eventually, he, kind of - did he stare them down into finally getting up and applauding for a couple of things?

WEINER: Well, clearly, the Republican talking points were not ready for him to read a list of seven or eight tax cuts that this Congress has done, because their first line was, boy, wouldn't it be great if he cut taxes and didn't know whether to applaud or to read from the talking points.

But the president did an artful job, I think, making it clear he doesn't want to have a partisan battle any more than necessary. But that he is going to fight for his values.

You know, many of us have wanted to see the aspirational, kind of ideal-driven candidate that we saw on the campaign trail become the president that who sometimes been too transactional. He showed me to me tonight that he's going to get back to those ideals and that's gratifying.

OLBERMANN: We'll expand on that if you'd be good enough to stay with us through the commercial break. We'll continue with Congressman Weiner.

But also ahead: Inside the president's plan to boost the jobs in advance of the midterms, will the proposals outline tonight get that done?


OLBERMANN: Continuing our special post-State of the Union address Countdown, we're again continuing with the Congressman Anthony Weiner, a Democrat of New York.

The idea about jobs as the number one goal, Congressman, in 2010 - saying small business is the generator of jobs, there's three questions about that. One, kind of co-opted the Republican message from several months ago before the stimulus began, does it give them an opportunity to say told you so? And more importantly, to the point, was the president specific enough about how to address the 10 percent unemployment?

WEINER: Look, I think that the least of the president's problems right now is the Republicans saying I told you so, we'll take your hand and we'll do a deal. Right now, the problem that we have here in Washington is that the Republicans, to a man and woman, are saying, we want no successes for the president whatsoever - which means they're not at the table for any discussions.

Is this going to answer every question? Of course, not. But I can tell you that his initiatives today do resonate with average citizens who are wondering when those closed stores on their shopping strips or in their neighborhoods mall are going to get reopened. I think he's got - he's got some plans that make some real sense.

I think our expectations sometimes in American civil life that things are going to turn around instantly. We were losing about 700,000 jobs a month when President Bush left office. We're losing about 60,000 jobs a month now. It's not perfect. But it's certainly going in the right direction.

OLBERMANN: Was it - was it phrased correctly the way he went out and emphasized the brief history of the economic troubles of the last eight, nine years, how they have been building and what he inherited - because if said wrong, that is exactly the kind of thing you said he did not do and needed to avoid tonight, which was to be say to be "woe is me about this."

Do you think he threaded that needle?

WEINER: He hit the tone just right. I mean, let's face it. There has been an organized effort recently to ignore the world before January of 2009. To act as if the deficit, for example, was created by President Obama, the fiscal woes created by President Obama.

The president very artfully pointed out the bank bailout, that my Republican friends criticized, was proposed by a Republican administration. He did that very well. He did it with - for the most part - in good spirit and even a few times with a smile on his face.

And what's important, though, is he set the record straight for the American people who, with deluge of misinformation, might have lost sight of those facts.

OLBERMANN: One question - I don't know the last time that in a State of the Union or any other function with the Supreme Court seated in front of him, any president of the United States has criticized what that Supreme Court just did - and videotape we are looking at, in the back rows, in the left, Justice Alito is saying that's not true to president's assessment of the possibility of big business taking over the elections and particularly foreign money coming in and influencing the elections.

I thought it was timely, obvious - obviously timely and of great concern to the American public. It is beginning to look like a - like a map of a weather forecast here. We'll stop running it on the continuous loop.

What did you think of the president criticizing the Supreme Court to its face? I guess that's the gist of the question.

WEINER: Well, it looked to me - I looked at Alito as well. I thought he was going to yell out "You lie" or something like that, in keeping with the spirit of the day.

But I give the - I give the president a lot of credit. I don't recall ever hearing that. And he did do the necessary caveat, you know, with all due respect. But directly saying to the Supreme Court what's needed to be said. You know, that decision - while many Americans don't focus on, it's not the kind of thing that enters their household every day, what the Supreme Court does - is going to have a remarkably corrosive effect in this town.

And for the president to look down at those nine members of the Supreme Court and say, "You messed up," I thought was something another thing reinforced the notion this was a straight-talk speech.

OLBERMANN: Well, as you know better than do I, even in the world of politics, when something is said prefaced with the phrase, "with all due respect," it often is followed by not all of that great amount of respect, but I take your point.

Congressman Anthony Weiner of New York - we appreciate your staying with us tonight.

WEINER: Thank you, Keith.

OLBERMANN: As authorities try to unravel why a group of men wanted to tamper with Senator Mary Landrieu's phones. The connections to the perpetrators and local Republican candidates and the tea party are now coming into focus. David Shuster joins us from New Orleans with the latest detail.

More reaction to the president's State of the Union as well in this special live late night edition of Countdown.


OLBERMANN: NBC News learned the federal government does not believe that the four men charged with infiltrating the office of U.S. Senator Mary Landrieu, the Democrat of Louisiana, in order to pamper with her phones were attempting to wiretap her. Instead, a law enforcement official tells NBC News the defendants believe that Senator Landrieu's office was unresponsive to calls about health care reform, it wanted to see whether her staff responded to the loss of their phones by laughing it off or expressing concern about constituents being unable to reach them. And they were all willing to risk 10 years in jail to do so.

Defendant James O'Keefe already admitted to taping the events. New reports unnamed officials today say that one of the two bogus phone repairmen wore a tiny hidden camera rigged into his hard hat.

Co-defendant James Dai, arrested in a car down the street, had what sources reported described as a listening device.

But the defendants are not random pranksters from outside the right-wing mainstream. They are, in fact, cultivated, nurtured products of the same Republican establishment now desperately trying to disown them tonight.

O'Keefe was on the payroll of conservative Andrew Breitbart, who denies any foreknowledge of this incident. O'Keefe spoke at one tea party, at least in St. Louis last year. And in 2006 and 2007, O'Keefe worked for the right-wing Leadership Institute, which says, quote, "The Leadership Institute does not analyze policy. It trains conservatives how to win."

Led by conservative activist Morton Blackwell, an institute group Campus Reform interviewed O'Keefe and his co-defendant Joseph Basel on January 14th, and wrote, quote, "to protect their ongoing investigations, we can't say exactly when or where the interview was conducted."

Basel attended Bush's 2005 inauguration, is a Facebook fan of the Tea Party Patriots group, and managed the 2006 campaign of now state senator, Bill Ingrebrigtsen, Republican of Minnesota.

Co-defendant Robert Flanagan, son of the acting U.S. attorney in Baton Rouge, works for the right-wing Pelican Institute, where O'Keefe spoke last week. Flanagan himself intern for Republican Congresswoman Mary Fallin, co-sponsor of the GOP resolution in the House that is to honor O'Keefe.

Mr. Dai claims to have been operations officer of a program at the Bush Pentagon, received a grant from the Phillips Foundation, which was itself started bid the late Robert Novak and kept going by right-wing publisher Alfred Regnery. He had a fellowship at the Foundation for the Defense of Democracies and its leadership council consists of Newt Gingrich, Robert McFarland, Joe Lieberman, Bill Kristol - you get the idea.

Reporting on this story for MSNBC is David Shuster who anchors our dayside coverage 10:00 a.m. and 3:00 p.m. every weekday and is back on his old beat, scandal watch and reports for us tonight from New Orleans.

Good evening, David.


OLBERMANN: So, the indication at this point is: we should not expect any further charges? Are the outlines of the crime complete in the prosecutors' minds at this point?

SHUSTER: To an extent, Keith. I mean, there's a grand jury that's available to these prosecutors and there's always the potential for a superseding indictment, especially if, in fact, they determine that, say, James O'Keefe was the ringleader and essentially gave an incentive - perhaps a financial incentive - for these others to help him. But assuming the facts stay as they are now, the case is not going to change that much.

But it's also important to point out, Keith, that the difference between a wiretap felony and a trespass felony where you're essentially trespassing on the phones that are operated by the United States government, as the criminal complaint says, it's still a felony and it's still a very serious deal.

OLBERMANN: The depths of this, this listening device that Stan Dai allegedly had, this was not some kind of wiretap attempt. Was there another explanation of what that phrase means, "listening device"?

SHUSTER: Yes, that's been described as some sort of a communication and whereby was either a walkie-talkie or a cell phone in which he was in contact with James O'Keefe. While James O'Keefe and other two on the 10th floor of the building and Dai was out in the truck, they were sort of having a conversation, this running conversation, or at least Dai was monitoring what was going on upstairs.

Again, the key information, Keith, is that Dai is apparently also cooperating with investigators - as are the rest. And the key for prosecutors is going to be: OK, never mind that they didn't have the necessary equipment to actually tap the phones, well, what exactly were they doing and clearly, the fact that they acknowledge that they intended to go in the office, that gets them the key issue, Keith, and that is to prove that there is a crime, you have to prove intent and just based on their admissions to investigators, it would seem that is in place.

OLBERMANN: There's one late detail and I don't know if you're aware of this, but the "Associated Press" moved a story about an hour and a half ago. And I just want to read this part of it because it dovetails into what NBC News reported earlier about this.

The incident referring to what happened on Monday in the senator's office occurred a month after Landrieu announced her support for the Senate health care bill. As the voted noted - near, rather - conservatives complained they were unable to register protests at her offices because their calls were referred to voice mailboxes that often were full.

There's a statement then from one of Landrieu's spokespeople about the senator not trying to intentionally avoid phone calls related to health care or any other topics. Certain irony to this, isn't it, that a - that a Democratic senator who was so recalcitrant on supporting health care, this may somehow dovetail into the bizarre rationale for these people who decided to come in and try to screw up her phone system?

SHUSTER: Well, and it certainly raises a deep question of judgment among these four. I mean, the idea that they would somehow try to shame Mary Landrieu's office staff here in Louisiana where she spends most of her time in Washington, shame them because, somehow, they're not picking up the phone as often as conservatives would like to hear the complaints. It's odd. It's even stranger when you consider, Keith, that again, they have demonstrated that they intended to go into this office, they intended to trespass on the phone system and somehow try to say, "Hey, they laughed when they realized their phone wasn't working."

Well, that's not what happened. They didn't get the result they wanted and now, they've got a felony charge hanging over them and prosecutor, Keith, who we are told - everybody who knows this guy says he's a no-nonsense guy, that he's fairly humorless. We had an opportunity to talk to the office twice. They take this very seriously. They don't find any of this very amusing.

OLBERMANN: By the way, "The New York Times" story, I believe it is, or perhaps it was "The Los Angeles Times," the woman involved in the ACORN videos with Mr. O'Keefe now issued a statement saying she sure hopes it's not true because she has the greatest possible respect for the law. So, Mr. O'Keefe - bust Mr. O'Keefe.

David Shuster, reporting for us from New Orleans - great thanks.

Have a good night.

SHUSTER: Thanks, Keith.

OLBERMANN: To return to the subject of the State of the Union address: whether or not the president's plans to boost the economy are anything more than a symbolic gesture. We'll go through this into the economic details. And when Rachel joins you when the quarter to mark of the hour, the view from the White House tonight from presidential senior adviser Valerie Jarrett.


OLBERMANN: One more quick update before we return to the subject of the State of the Union, on the arrest of James O'Keefe in the offices of Senator Mary Landrieu on Monday. The "Associated Press" has moved this tantalizing blurb. Four days before James O'Keefe was charged in a plot to tamper with the office phones of Democratic Senator Mary Landrieu, the conservative activist promised his audience at a luncheon, they would be hearing about a project he was working on in New Orleans. O'Keefe would not elaborate on the nature of his plans, according to people who heard his speech, at the luncheon held by the conservative Pelican Institute last Thursday in New Orleans.

You've been following the story, you'd know, the Pelican Institute is mere blocks away from the offices of Senator Landrieu - that Mr. O'Keefe and his colleagues entered under suspicious and, in fact, dubious circumstances on Monday.

OLBERMANN: To return to the subject of the State of the Union, the biggest headline in the night could easily be, for the average person at home, the subject of either the bank tax, or if you want to broaden that out a little bit more, what the president said this evening about his administration's commitment to reducing unemployment and starting long-term new jobs. Here's what the president said.


OBAMA: I realize that for every success story, there are other stories of men and woman who wake up with the anguish of not knowing where their next paycheck will come from, to send out resumes week after week and hear nothing in response. That is why jobs must be our number one focus in 2010, and that's why I am calling for a new jobs bill tonight!



OLBERMANN: Joining us now from Austin, Texas, economist James Galbraith of the University of Texas, son of the legendary economist John Kenneth Galbraith. We thank you for your time tonight, sir.


OLBERMANN: That focus on the creation of jobs as his first priority in 2010 - what's your view of that, and the president's point of view on this, from your angle as an economist?

GALBRAITH: I think it's a very significant change. The State of the Union sets tone and priorities, and what the president did tonight was to say that unemployment and job creation, a jobs program, is the number one priority for his administration going forward.

The other thing that he did which I thought was very interesting was that he laid out the elements of a coherent program in the correct order. The first thing was to get a jobs bill that would go to work immediately and particularly focused on small business. The second thing was financial reform. Then he turned to investment, which will create jobs on a longer timeframe. He folded transportation, green jobs, and education into that.

At that point, he came to health care and said, Yes, I'm still committed to this. You've got to do it, but he quite properly did not stake his entire administration on success or failure.

And then finally, after that, about 50 minutes into the speech, he made some references to the deficit to - to the situation that came in, that pertained when he took office, and to his plans for a year or so from now. But the immediate priority is jobs. That to me sets a very significant new tone for the year ahead.

OLBERMANN: As then an economic policy document, how would you grade this?

GALBRAITH: I was very impressed because the - the problem with the administration's initial approach to the economy was an excessively optimistic belief that the Recovery Act, the stimulus package, would basically take care of things and that we would be able to move on by now. It now seems clear that they understand that's not the case. We have a long-term economic problem. We need to set a strategic direction and to stick with it over a period of years to get this problem under control.

That to me is very, very encouraging. I think the American people have understood that to be the case, and he will connect with the American people by laying that program before them. But what the Congress will do, of course, is another matter. But that's - you know, he can only get the ball rolling at this point, and I think he did that tonight.

OLBERMANN: If, in your opinion, overall tone was good and the specifics were strong and the sequence in which they were placed - the priorities were placed in the correct order, from your assessment, do you have any idea why, of all the things that would come out in advance, two days in advance of this speech about the economic content, he would mention this really kind of more symbolic than anything else and not taking effect until next year, partial freeze on some - a very - a fairly small range of expenditures in the domestic budgeting for 2011? Why of all things would they let that out, when there was so much else that seemed to resonate better economically?

GALBRAITH: Well, I would make the shrewd guess that it might have been in order to deflect the Senate from enacting a statutory commission that would have fast-tracked cuts in Social Security and Medicare. And they achieved that. So this thing now fits back in its proper place in a larger economic program and takes on, I think, a very different hue in light of the fact the Senate didn't go forward with Conrad-Gregg and the president tonight said, Well, I'm going to do something by executive order. But an advisory commission does not have the same power to coerce the Congress that the legislative statutory commission would have had.

OLBERMANN: Well, a fascinating observation. James Galbraith, economist at the University of Texas, great. Thanks for that and for your time tonight, sir.

GALBRAITH: A pleasure.

OLBERMANN: That president Obama was in a position to discuss the state of the economy in his first State of the Union address due entirely to the men and women who voted him into office, with a huge groundswell of support from the liberal base. The progressive reaction to his agenda tonight with Markos Moulitsas of Daily Kos. And yet another a late-breaking development on the arrest of James O'Keefe and a denial that any attempt was made by he and his fellow perpetrators to even tamper with the phones of Senator Landrieu.

Details next on Countdown.


OLBERMANN: If you have been following our reporting on the story of the arrest yesterday, or arrest Monday and disclosure yesterday, of James O'Keefe and three others in the office of Senator Mary Landrieu of Louisiana, you will be aware perhaps that prosecution sources are indicating that they don't believe it was an attempt to tamper with the phones as much as there was an attempt to in some way stop the phones or make some sort of scenario develop in which they could mock Senator Landrieu's office for not being able to be responsive to callers who objected to her stance on health care. But to tamper with the phones, those were the charges made against the senator (SIC).

Mr. O'Keefe's attorney has now addressed this subject in "The Wall Street Journal." Michael Madigan (ph) is quoted by that conservative newspaper as saying, "There was no bugging of telephones, no wiretapping, no trying to interfere with the phone system. We are cooperating with the U.S. attorney's investigation and are confident that the true facts will come out."

So O'Keefe's attorney, in fact, now denies that there was even interference with the phone system. There's also this nugget, that the men have not entered pleas. All four scheduled to appear in federal court in New Orleans next on February 12th. That's the latest on that.

Returning to the State of the Union now. We're joined by Markos Moulitsos of The Daily Kos, as promised. Markos, thanks for waiting with us. We appreciate it.


OLBERMANN: So this speech tonight - there's been often criticism from even some of his strongest supporters that the president gets flowery and non-specific and rhetorical when specific action is called. Did you see that change in his speech tonight?

MOULITSOS: Well, we had a little bit of both. We had his typical usual flowery rhetoric, which is not a bad thing. I'm not going to criticize that. But thankfully, we got more specifics. And when he got specific, I think the speech was very, very strong. I mean, he talked about great things, investing in clean energies. The student loan stuff was fantastic, "Don't ask, don't tell."

So I think we have a clear road map for where he wants to go this year, as opposed to just vague values talk, which, while it may sound great, it gives people very little to rally around.

OLBERMANN: The - the other tone was - and sometimes it resonated with the people on the left side of the screen, looking at it from that overhead shot from behind the president, and sometimes it didn't, the calls for bipartisanship. Was that a highlight, in your estimation?


MOULITSOS: Not from mine! You know, the - the president talked about how we needed to get beyond cynicism and - but then he also admitted that part of that cynicism is the inability of the Democrats to use their majority to pass a significant part of their promises. And the reason they were unable to pass a lot of that is because of the refusal of the Republican Party to play ball. I mean, they - they were - they were the party of no. They vote no on everything.

And so you - health care debate is a perfect example, where Democrats spent months trying to negotiate in good faith with Republicans who had no interest whatsoever in actually helping the Democrats pass anything of substance.

OLBERMANN: Were you encouraged, then, to actually hear him call them

he didn't use "the party of no," but he did say, If all you're going to do is say no, this isn't going to work, and at the same time, on the subject of health care reform, he did say, I take my share of the blame for the fact that it had not passed heretofore. Was that - was that kind of reality-based State of the Union address refreshing to you?

MOULITSOS: Yes. Absolutely. I think it's an acknowledgement that those of us who have been critics of the approach weren't wrong or were - you know, were not in the wrong for making those criticisms. I mean, we saw that they were stymieing the negotiations, that they were going nowhere. And I think that's an acknowledgement that maybe we had a point there and maybe they need to change up their approach.

Now, I think a lot of that talk about bipartisanship is really geared towards independents, who like that kind of talk. I think it's fantastic to invite Republicans to the table to negotiate. But if it's obvious from the beginning that they're not negotiating in good faith, I don't think Democrats should waste a lot of time. They have majorities for a reason. They should use them.

OLBERMANN: Markos, did you get the sense by any stretch of the imagination that some of that bipartisanship was actually the president of the United States saying - picking out an easy to identify enemy, say, big banks, and say, We're going to go and - we're going to go and now punish the big banks, because nobody likes the big banks and everybody hated the bail-outs, and even though we had a part in both of those things coming to pass, we all hate them now, and I dare the Republicans not to follow me. There's that kind of bipartisanship in here, as well?

MOULITSOS: I'm all for that! And I think the president was also very effective in sort of using rallying around the flag-type rhetoric to essentially force Republicans to applaud along, saying, Do we want to be second in the world in energy independence and in alternate fuels? I mean, do we want to be second to China and Europe? Of course, nobody wants to be second, especially in this country. So I thought that was actually very effective. I'd like to see more of that. I'd like to see more of the populist talk, the bank bashing. I think that's going to be gold electorally in 2010. We need to see more of that, too.

OLBERMANN: Yes, clearly, that's it, right? The takeaway from last week in Massachusetts is not, Oh, they elected a Republican, oh, Ted Kennedy's seat was lost, this, that or the other thing. The takeaway from all of that was there is - if there's one agreed-upon thought throughout this country right now, it is that - it is Wall Street at the expense of Main Street. Whoever grabs that horse and rides it wins.

MOULITSOS: Yes. You know, we just had an election yesterday in Oregon where the voters passed a tax increase. I mean, you don't see that every day, especially Oregon, which has been a fairly anti-tax state. And one of the organizers of the effort to pass that tax increase said that he was shocked that in focus groups, one of the first questions people asked was, Where do the banks stand on this because I want to be on the other side. People do not like the banks. Democrats tap into that, we may actually salvage something this year.

OLBERMANN: Yes. It would be a bit of a turn, but apparently, at least the president of the United States can make that turn politically. We'll see if anybody else follows him. I'm sure the message is going out, You damn well better.

Markos Moulitsos of Daily Kos, always a pleasure. Great. Thanks for your time tonight.

MOULITSOS: Any time. Thank you very much.

OLBERMANN: That's Countdown for this, the 2,463rd day since the previous president declared mission accomplished in Iraq. You heard the president of the United States say tonight that the troops, the combat troops, will indeed be out by August.

I'm Keith Olbermann. Good night, and good luck.

And now to discuss the State of the Union with the White House senior adviser Valerie Jarrett, ladies and gentlemen, once again, here is Rachel Maddow. Good evening, Rachel.

'Countdown with Keith Olbermann' for Wednesday, January 27th, 2010 - 8pm
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Video via MSNBC: Quick Comment (Breitbart), Quick Comment (Obama critics), Worst Persons
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Guests: David Shuster, John Dean, Richard Wolffe, Howard Fineman, Eugene Robinson


KEITH OLBERMANN, HOST (voice-over): Which of these stories will you be talking about tomorrow?

The breaking news: One of the, quote, "telephone repairmen" in Senator Landrieu's office, Joseph Basel, had been the campaign manager for a successful Republican state senate candidate. Authorities are not dismissing this as a prank.


UNIDENTIFIED MALE: We don't take any incident lightly when it comes to attempts to penetrate our security.


OLBERMANN: Running for cover, with Basel identified as an ex-Republican campaign manager, with O'Keefe to have keynoted the GOP's Salt Lake fundraiser next week, the Republican mainstream and the tea parties which O'Keefe addressed and which Basel belonged, try to bury their connections; while those media godfathers try to forget its pledge (ph).

The scandal day two, with David Shuster in New Orleans; Richard Wolffe in Washington on the prospect of congressional investigation; and John Dean in Los Angeles on the Republican dirty tricks recruitment machine.

Sarah Palin, quote, "Republican in name only," attacked by the right for endorsing - John McCain? It's perfect.

State of the Union.


UNIDENTIFIED REPORTER: Mr. President, what's your message on health care tonight?



OLBERMANN: Howard Fineman on a president under a microscope; Gene Robinson on a Congress 84 percent of Americans believe is too influenced by special interests; Chris Matthews and Rachel Maddow on whether the nation wants freezes and compromises.

And the "Quick Comment" that what we need is this.


FRANKLIN D. ROOSEVELT, FMR. U.S. PRESIDENT: Government by organized money is just as dangerous as government by organized mob.


OLBERMANN: All the news and commentary - now on Countdown.


OLBERMANN: Good evening from New York.

The infiltration of U.S. government facilities in New Orleans and the attempt to somehow alter the office phone system of a sitting U.S. senator was not, it turns out, just the work of one right-wing, quote, "journalist," unquote, but, in fact, four right-wing men, who are not pranksters on the conservative fringe, but rather recruits of, mainstays of, and the prospective future of the right-wing's bedrock institutions.

And we know more today about the operation inside the office of Louisiana Democratic senator, Mary Landrieu - as law enforcement officials tell NBC News the federal government believes the defendants were not trying to intercept or tap phone calls, but believed that Senator Landrieu's office was unresponsive to calls from critics of health care reform and wanted to document whether her office responded to a total shutdown of its phones by laughing it off or expressing some sort of concern about constituents being unable to reach them.

Entering under false pretenses to cut off the senator's phones - wiretap or not - is, guess what, also a crime, punishable by up to 10 years in prison.

Defendant James O'Keefe has already admitted to taping the events and new reports from unnamed officials today said one of the two bogus phone repairmen wore a tiny hidden camera rigged into his hard hat.

Co-defendant James Dai arrested in a car down the street had what sources had reportedly described as a listening device. But the defendants are not random pranksters from outside the right-wing mainstream. As we learn more about their backgrounds, it turns they are, in fact, cultivated, nurtured products of the same Republican establishment now desperately trying to disown them tonight.

O'Keefe, we already knew, posted videos of what he used to describe as pranks and then began to call journalism on the website of the conservative Drudge protege Andrew Breitbart. Breitbart now admitting O'Keefe was on his payroll on salary while denying any acknowledge of this latest event.

O'Keefe is a favored GOP speaker, including to at least one tea party rally in St. Louis. And as recently as 2006 and 2007, he was on another right-wing payroll, working as a campus recruiter for the right-wing training facility, the Leadership Institute, which says on its Web site, quote, "The Leadership Institute does not analyze policy, it trains conservatives how to win."

Led by longtime conservative activist Morton Blackwell, the institute's campus group, Campus Reform, interviewed both O'Keefe and co-defendant Joseph Basel, past recipient of the Leadership Institute seed money on the 14th of this month, and wrote, quote, "To protect their ongoing investigations, we can't say exactly when or when the interview was conducted."

Basel, another party mainstay, attended the Bush 2005 inauguration, is a Facebook fan of the Tea Party Patriots, and managed the successful 2006 campaign of now-State Senator Bill Ingrebrigtsen, Republican of Minnesota.

Co-defendant Robert Flanagan, son of an acting U.S. attorney, was a paid employee of the right-wing Pelican Institute, about a block away from Landrieu's office, which had O'Keefe as a speaker, did the institute, just last week.

Last year, Flanagan interned for Republican Congresswoman Mary Fallin of Oklahoma, cosponsor of a recent GOP resolution honoring O'Keefe.

Mr. Dai has equally impressive connections in the Republican Party, claiming to have been operations officer of a Pentagon counterterrorism program during the Bush presidency. Recipient of a $5,000 grant from the Phillips Foundation, started by Robert Novak, and kept going by a right-wing publisher Alfred Regnery; and a former undergraduate fellow on terrorism at the Foundation for the Defense of the Democracies. Its leadership council: Newt Gingrich, Robert McFarland, Joe Lieberman, Bill Kristol - you get the idea.

Reporting on this story for MSNBC tonight, David Shuster, who, of course, anchors our dayside coverage at 10:00 a.m. and 3:00 p.m. each weekday and is back on his old beat, scandal watch tonight in New Orleans.

David, good evening.


OLBERMANN: Based on today's reporting, should we not expect further charges then? Are the outlines of the crimes complete in the prosecutor's mind at this point?

SHUSTER: Well, Keith, a couple of things. First of all, there is a grand jury that is available to the prosecutor should the prosecutor develop new information. However, this does not appear to be shaping up as any sort of a wiretap case. Instead, all of the information, of course, is that it's a federal trespassing case.

There are strong indications that each of the witnesses, each of the people who are in this criminal complaint, Keith, have started talking and that prosecutors will simply try to corroborate their stories, make sure that they're all essentially telling the same stories, but also try to determine, Keith, whether or not there was a particular ringleader. Was there any incentive, for example, that James O'Keefe gave to his colleagues to participate in this?

And there's always the possibility, as prosecutors will say, Keith, that there can be a superseding indictment, that you can bring additional charges based on the information that is developed. And that in the course of perhaps trying to reach a plea deal, that if somebody becomes a government witness, they could have their charges reduced.

OLBERMANN: Let's get into the weeds of this a little bit. The listening device that Stan Dai allegedly had according to the "Associated Press" last night, if that - if that's not a wiretapping attempt, is there another explanation for what that phrase "listening device" means?

SHUSTER: Yes, Keith. Sources familiar with the case are suggesting that this was some sort of walkie talkie, maybe even a cell phone that Dai had in that van and that he was in communication with O'Keefe, who was upstairs on the 10th floor of that building behind me. It's not clear whether or not Stan Dai had the ability to either record on this cell phone or just walkie talkie, but rather, that he was in communication with the people upstairs.

Again, the description of this as a listening device, that was from a law enforcement source and it may have been a little bit misleading. There is every indication that the people upstairs on the 10th floor were communicating with the guy, Stan Dai, who was down in the truck. But again, it looks like it's a simple explanation as some sort of walkie talkie, perhaps even a cell phone with a walkie talkie device connected to it.

OLBERMANN: It does beg the question of what he's doing down there.

But I'm sure they've already raised that one.

Something in the language of that January 14th piece from the Leadership Institute's campus group, suggests they knew O'Keefe and Basel were up to something. O'Keefe was on Breitbart's payroll for written work, exclusively. Does this investigation need to expand? Does it seem likely to? Are prosecutors looking into the backgrounds, as everybody else seems to be, of the four men involved?

SHUSTER: Well, they will. I mean, I spoke to Andrew Breitbart today, who said flat-out that the last time he spoke with James O'Keefe was several weeks ago and he had no earthly idea that James O'Keefe was up to this.

But, again, that's something for the prosecutors to determine. I mean, prosecutors will tell you that they have to essentially figure out, was there any financial incentive? With all the people that had financial connections to James O'Keefe, did they give him any incentive? If O'Keefe tells prosecutors, "Look, I did this completely on my own," there's a due diligence that prosecutors have to follow to make sure, so you can expect that Andrew Breitbart and some of the rest will eventually get calls from investigators, and there may be - it may be absolutely true that they had nothing to do with this.

But the prosecutors are going to follow this. They're not just going to take the word of James O'Keefe and the rest. They're going to try to make sure that the funding here, that you can explain that how this came about.

OLBERMANN: It's too bad there isn't videotape of what actually went on there - oh, yes, there is, isn't there?

MSNBC's David Shuster, who airs weekdays at 10:00 and 3:00 on the network - great thanks for your reporting tonight from New Orleans.

SHUSTER: Thanks, Keith.

OLBERMANN: With us tonight, another echo of Watergate here. He's the former White House counsel for President Nixon, author of "Blind Ambition," John Dean.

John, welcome back. Good to talk to you again.


OLBERMANN: So, is this a prank, is it a caper, or is it a third-rate burglary?

DEAN: Well, it's certainly not a prank. It's pretty serious. I think it happened - from what I can piece together - it looked like more of a continuation of O'Keefe's entrapment journalism that he was working on.

It's pretty nasty stuff. It's something they're trying to get people to say things they shouldn't or find situation where they can record them and then embarrass them and hurt them in some way. And it's pretty mean-spirited stuff that they've gone beyond what is legal to try to accomplish.

OLBERMANN: It must be, however, as mean-spirited stuff goes, it may -

it must sound awfully familiar to you, because the training school quality to the backgrounds of these guys, their roots. Has not the college Republican machine been turning out people like James O'Keefe for a lot longer than James O'Keefe has been alive?

DEAN: Well, indeed, it has. I think Karl Rove was one of the early tutors that went around campuses to instruct people on how to do these sorts of things. How far Karl went as to the mechanics, I don't know. But that's certainly legendary on the right, that this sort of activity is acceptable.

And also, the fact that O'Keefe's work has been so applauded by his elders, if you will, has been nothing but encouragement for this kind of activity.

OLBERMANN: Is this not, to some degree, reminiscent of Donald Segretti and that whole crowd from the campuses of the mid-'60s?

DEAN: Keith, I can't believe the stupidity of it all. You know, we've been there, done that, people have realized the mistakes that were made. It really is stupid that they would do this sort of thing or try to continue to do these kinds of things at this late stage. You think we would evolve in our political intelligence at some point.

OLBERMANN: Well, we can both wait.

Explain - something legal for this, and with your firsthand experience on this so many years ago, particularly, how can - how can this be - can this be a conspiracy without being a directed conspiracy. In other words, you wind these guys up in college, in internships, in this, you know, of this plethora of different training, hothouses, and then you give them a certain mindset and you, what, you just let them run loose on their own devices?

DEAN: Well, you know, the fact of - a conspiracy in the law is when two or more people agree to undertake illegal act and one person takes an overt step to further that agreement.

Clearly, this is a classic criminal conspiracy with these guys and what they did. How far back it reaches, and who all the co-conspirators are, we don't know yet. If this is something that happened where somebody else in their like-thinking crowd said, why don't you do something like such and so, they could well be pulled into the conspiracy. That's one of the things I think the investigators are going to be looking at and try to resolve, because this may be more than four people.

OLBERMANN: Are we correct to suggest that these guys are not outliers, away from the Republican mainstream, but they are more representative of the mindset, the tactics, and maybe the ethics of the people running the party and the institutions that nurtured these guys?

DEAN: Well, I'd certainly say that's true, given the endorsement of the kinds of activities in the past, when they've engaged in this sort of thing, where they illegally recorded people at ACORN, the kinds of telephone calls they've recorded to embarrass people. They've used this before.

So, I think this has been embraced by the Republican right and those who, indeed, control the party today. I think that they are clearly trying to distance themselves now, but they encouraged it.

OLBERMANN: John Dean, Nixon White House counsel, author of "Conservatives Without Conscious" - as always, great thanks. And who ever knew we'd be talking about something this specific to your background. Thanks, John.

DEAN: Thank you, Keith.

OLBERMANN: The possible absence of more does not mean there is not enough. If the Louisiana senator in question had been named Vitter, the demands for a congressional investigation might drown out the State of the Union address tonight. Will the Senate inquire in defense of the security of one of its Democratic members? And where is this going politically?

"Quick Comment" and Richard Wolffe - next.


OLBERMANN: Now, some of the far-right reaction to the explosion of the phone-gate scandal in tonight's first "Quick Comment."

Mainstream media leaping to conclusions while big government, his Web site, waits for facts. This is a new policy for the writer Andrew Breitbart. You're applying it to Major Hasan and Abdulmutallab and everybody else detained in Gitmo or just for your own employees?

What he does for the site exclusively is he tells his life rights, basically, so when he puts a story out there, it's on the Breitbart sites, he's paid a fair salary. What Mr. Breitbart is trying to hide there is that the ACORN story involved at worst a minor government contractor willing to misappropriate money to some kids just back from the Halloween party still dressed as Superfly.

This is already four charged federal felony crimes against the United States government with a confession with its victim, a U.S. senator. And at its center is a man paid a salary by Mr. Breitbart to recount all his adventures, who might be offered a way out of years in jail if he turns on, say, some hypothetical person who paid him.

It's like throwing the light on in the kitchen and watching the cockroaches scatter. But one of them is struck to the floor, Andrew Breitbart.


OLBERMANN: After James O'Keefe and his actual co-conspirators were arrested, O'Keefe's virtual cohorts quickly figured out a way to deal with this. So now, the pimp-impersonating conservative cavalier who was hailed as a hero has suddenly turned into the right-wing media equivalent of - who that? As exemplified from the most visible microphone of Mr. O'Keefe's body of work, FOX News.

That red bar here represents how much time FOX News spent on O'Keefe's ACORN video on September 10th, 2009 when it was first released.

The little tiny blue blip over on the right shows how much time FOX News devoted to O'Keefe's arrest last night - a grand total of four hours and 35 seconds over six hours of programming.

Meantime, the 34 Republican congressmen and women who supported a resolution to honor O'Keefe for his ACORN video, they are mostly saying nothing.

But one of them, Congressman Joe Pitts of Pennsylvania, has reacted through a spokesman. Quote, "The congressman doesn't know him."

Meanwhile, a cosponsor of the resolution, Congressman Pete Olson of Texas, would not say whether the resolution would now be withdrawn and his pro forma statement on the matter begins with, "Individuals who lawfully expose wrongful activities by an entity like ACORN should be praised." The statement then added that, "if any recent events conclude that any laws were broken, that is not something I condone."

And besides the reaction of Andrew Breitbart already noted, other commentators are dealing with O'Keefe, dealing what they can for now by remarking that nothing justifies breaking the law while also trying to portray the event as simply another videographer gone wild, another sting gone wrong.

But the Salt Lake City Republican group has reacted to the mug shot version of O'Keefe by canceling O'Keefe's appearance as its keynote speaker next week for this year's Lincoln Day dinner fund-raiser on the 4th of February.

For the political implications of this, let's turn now to our own Richard Wolffe, the author of "Renegade."

Richard, good evening.


OLBERMANN: Obviously, State of the Union night, this is not the front burner in Washington, but where does it stand? Are the prospects that Congress wants to look into this, specifically the Senate, because this is about, after all, a senator's security, no matter which party she belongs to?

WOLFFE: Well, I highly doubt the Senate will get into this kind of thing and not least because it's a question of law enforcement. This is an alleged federal felony and while it's in the hands of law enforcement, really Congress needs to step aside and keep out of it. Yes, there could be a policy issue about the security of senator's offices, if they really want to take it that far, but there is an important principle here.

And in a way, Congressman Olson's statement kind of picks up on this. What ACORN is supposed to have done is what he describes as wrongful. What these guys are alleged to have done is actually illegal. And when it comes to matters of legality, really, law enforcement, in this case, the FBI, are the right people to deal with it.

OLBERMANN: Regardless of that, if this, in fact, had been David Vitter's office, would there not be a Republican shouting about starting an investigation during the State of the Union in the next hour or so?

WOLFFE: Well, it is hard to predict what some people are going to shout as abuse to a president. Hopefully, they won't shout anything out, but let's deal with how that came about for an instance. Because it is, actually, related to this story.

You know, the kinds of misinformation of distorted facts that get their way into a congressman's hands, like question of illegal immigrants being covered by the president's health care plan, that is precisely the channel we're seeing with this ACORN material that O'Keefe mined and Andrew Breitbart used so effectively.

Members of Congress, Democrats and Republicans, need to be careful about the sourcing of their own information. And just because it's new media and it seems fun and new technology and raw and energetic, doesn't mean to say it's true and definitely should not be elevated to a congressman's agenda. And it certainly, in any case, shouldn't be used as a form of abuse.

OLBERMANN: This revelation that Mr. Basel was a Republican campaign manager in a state race in Minnesota and was on the Facebook page for one of the tea parties. O'Keefe spoke at one of the tea party rallies. Are these guys ultimately going to resonate in those circles as aberrations, as poster children, or is it going to be "O'Keefe - O'Keefe who?"

WOLFFE: Yes, I suspect those people are not going to walk away from this guy's work when it comes to ACORN and they may well still celebrate him. That's exactly the opportunity, though, there is for Democrats to exploit the difference between respectable Republicans and the tea party folks who want to praise and wants to go after this kind of agenda that O'Keefe represents.

You know, they need to actually, as Democrats, say, where are you going to stand here? Look at those 31 Republicans who went for this congressional resolution and say, where do you stand on the truth, on facts, and whether you stand with O'Keefe? Because you've got to separate out what is fringy and Internet-driven and what is still a respectable mainstream party in the Republicans.

OLBERMANN: And what do they do? I mean, those 31 members include Steve King. So, there's absolutely no predicting there. But what do the other 30 do? Do they - do they wait to see how this turns out? Because one would assume, unless there are guilty pleas quickly, this is going to drag on for some time?

WOLFFE: Well, I'm sure they're just going to try to keep their heads down and not talk about it. But that's no reason for Democrats to leave it alone and say, well, are you going to carry on with this resolution?

This is a congressional resolution. It's not just, you know, a Christmas card list here. So, you know, that - this is an election year. Republicans would not hesitate to try and drive this on. I don't recall them being quiet when it came to CBS and a story about a certain former president.

OLBERMANN: See if the Democrats can do the same. Richard Wolffe of MSNBC, author of "Renegade" - as always, great things.

WOLFFE: Thank you, Keith.

OLBERMANN: As we count down to the State of the Union, one person who might be thanking James O'Keefe tonight is Sarah Palin. You probably haven't heard this because of the confluence of phone-gate and the State of the Union, but the far, far-right and the tea partiers have just turned on Sister Sarah - next.


OLBERMANN: The State of the Union, a president gets another chance to make a first impression - coming up.

But first, tonight's "Worst Persons in the World" with some actual breaking news in it.

The bronze to our buddies at CNN. writes of their latest new prime-time show, that's the 10th new one since Countdown started. Quote, "Networks sources say that King's show could be aired squarely at the political junkie niche, those viewers determined to know who's up and who's down in Washington each night. That's speculation - of something like a political "SportsCenter" - was likely fueled when word got around that executives had reached out to a producer with experience at ESPN, said sources."

I mean, it's a while ago, but "SportsCenter," seriously? And our prime-time vice president here was there for seven years and we have a consultant from there. Maybe you'd like to try a political "Wheel of Fortune" instead.

The runner-up, Bill Shine, the vice president of fix news. This is a great try, defending his network's swing and a miss on Haiti, by attacking the other networks for covering Haiti, telling the "L.A. Times," quote, "Look, what happened in Haiti was just horrific, but there are also some big stories in America that we chose not to ignore the way that other networks seemed to."

Oh, like, the in-depth coverage of the anti-Obama Facebook page out of Indonesia, so you could run these graphics with Obama, the Indonesia flag, and country shape, and the word "home coming." And this one about taking down a statue, tearing him limb from limb.

Or that other big story in America that you didn't ignore, the rest of your own Chris Wallace-anointed power player of the week, James "Superfly" O'Keefe.

But our winners: Glenn Beck, Michelle Malkin, the blogs: Red County and Reality Check, and Paul Streitz, founder of Draft Sarah 2012. They have attacked the wonderful Sister Sarah. Malkin: "Tea party activists are rightly outraged." Red County: "Her political waterloo, supporting an enemy to the tea party movement and by de facto, becomes the enemy."

Streitz: "What should this be called, the Rinoization of Sarah Palin."

Beck: "I want to have another sit-down with her."

What did she do? What did Rino Sarah Palin do? Snubbed tea party-wannabe J.B. Hayworth and instead endorsed the senator of Arizona, John McCain.

One more quote from Reality Check, "Palin has proven that she is for sale."

Reality Check purports to be a Christian Web site and says Sister Sarah is for sale. Leave Sarah alone! Glenn Beck, Michelle Malkin, the blogs Red County and Reality Check, today's worst persons in the world.


OLBERMANN: "I am not the first president to take up this cause, but I am determined to be the last." President Obama's determination to enact health care reform legislation seeming to have dwindled considerably since he made that declaration to a joint session of Congress just four months ago. On that night in September, the president's entire address devoted to making his case for health care reform.

But heading in tonight's State of the Union, Mr. Obama and his advisers were still debating whether he would even call for a scaled down version of the bill that was supposed to have been the centerpiece of his domestic agenda, or more likely just to fold it into the big tent topic of the economy. Advisers indicating the president will say it is not time to walk away from health care reform, yet the bulk of the president's remarks seeming to do the walking for it.

The Associated Press reporting roughly two-thirds to be devoted to the economy. Another large chunk to foreign policy and security issues. His goal, again, according to the AP, to show a dissatisfied nation that he understands their frustration and struggles, and that his agenda is in touch with the things they need. Forty five million Americans currently without and needing health care insurance.

At the White House today, when asked what his message to the nation will be about health care, the president saying only, "it's a good one." And in an excerpt of his remarks, released just minutes ago, the president had this to say about health care reform - this is what he will say during the speech. "By the time I'm finished speaking tonight, more Americans will have lost their health insurance. Millions will lose it this year. Our deficit will grow. Premiums will go up. Co-pays will go up. Patients will be denied the care they need. Small business owners will continue to drop coverage altogether. I will not walk away from these Americans and neither should the people in this chamber."

On that note, let's turn to our own Howard Fineman, senior Washington correspondent for "Newsweek" magazine. Howard, good evening.


OLBERMANN: Health care reform is not the headline. It's part of the big two-thirds of the time economic message. What message is the president sending to Democratic lawmakers already retreating on health care reform by simply that apportionment of time tonight?

FINEMAN: Well, having been at a briefing this morning, a background briefing on this, and reading the excerpts and talking to people in the White House and on the Hill, it's clear that while he's telling them that they shouldn't walk away, and giving a very good explanation for why, he's basically saying, you know, if you do, there might be nothing we can do about it.

I do think that they want to make the argument at the White House that there's still both substantial benefit and political benefit in trying to do insurance reform. The stuff about preexisting conditions and making sure people aren't dropped from coverage and so forth, that they can score political points on that with the Republicans, entice the Republicans into supporting those things, that that's both substantively and politically a good idea.

But I'm not sure the president's going to really press that in the remarks tonight. I'll be listening to see if he does.

OLBERMANN: As we see the speaker having arrived. We say it in football, yelling stop as they run right past you rarely gets them to stop. But the president has spent so much of the first year saying rising health care costs are a threat to the economy. It's not like it's some new invention that he's just come up. And it was one of the touchstones of the joint address in September. So how does a health care-light agenda translate into one that's suddenly going to create jobs and fix the economy?

FINEMAN: Well, it doesn't. But they sort of gave up on or didn't win the argument about the notion that health care reform, as it was eventually devised in Congress, would actually save a lot of money. In other words, the original idea was you could sweepingly reform health care, cover everybody and save money at the same time by rationalizing the system. They never won that argument. And the fact that it's not going to be made tonight, in a speech where he's going to talk a lot about deficit reduction, shows that they've given up on that argument, at least for now.

OLBERMANN: The White House Press Secretary Mr. Gibbs said today, in several different venues, that the president will accept responsibility for not delivering on some of his messages. He's not going to accept blame, per se. This is verbatim an old David Frie (ph) joke that he delivered as Richard Nixon. The whole thing was, those who are to blame lose their jobs, those who are responsible do not. How do you split this hair?

FINEMAN: Well, I actually think David Axelrod, who's the senior adviser and who I've known ever since he was a political reporter, and a very good one at the "Chicago Tribune" in the early 1980s, who knows how to construct a narrative, who knows about salesmanship and politics, because he's been a media adviser for 25 years, I think does deserve some of the blame, and I think he'll take some of the blame.

Rahm Emanuel, the chief of staff, deserves some of the blame for the basic strategy of turning health care over to Congress. It reminds me of that scene in "Apollo 13" when they bring in all those parts and dump them on the table and say, make something out of this. Only failure was an option, unfortunately, for them.

OLBERMANN: "Apollo 13" got back safely.

FINEMAN: Exactly.

OLBERMANN: One thing that must be noted, as we see the vice president come in, we saw Mr. Engel got his front row seat for the 23rd consecutive year. They're going to address Don't Ask Don't Tell?

FINEMAN: That's a nod culturally in the direction of the base of the Democratic party and the grassroots and the net roots that got Barack Obama's campaign going to begin with. But that's just a political nod that's not really going to help them with the - America as a whole, in a speech that's supposed to be about jobs.

OLBERMANN: Howard Fineman of "Newsweek" and MSNBC, we'll talk to you again on the late-night live Countdown, about 10:30 eastern. Be back by then, if you would.

FINEMAN: I will, Keith.

OLBERMANN: Thank you. As the House chamber fills, we saw Senator Bunting there for a moment, as the vice president goes to the podium. Once again, a suggested role model for this president tonight in a quick comment, next.


OLBERMANN: Literally, within the last minute, the president and the First Lady leaving the White House for the motorcade to Capitol Hill for tonight's, his first, State of the Union Address. As we look at that, now the second of tonight's quick comments.

There is doubt among those who elected him that this president has proved the leadership requisite to regaining control of this country. From the banks, from the insurers, from the corporations, and given to the people.

There should also be no doubt that this president is capable of that leadership. Others have been, in times bleaker still, with fewer weapons at hand. "Powerful influences strive today to restore that kind of government with its doctrine that that government is best, which is most indifferent." So said Franklin D. Roosevelt on the 31st of October, 1936, as he sought a second term against those who would freeze government spending and comfort the banks, while letting the people founder.

Change begins with saying aloud that which is wrong, saying it loudly and clearly, challenging those who would defend the wrong. The rest of it is best heard as Mr. Roosevelt said it, just three blocks from here.


FRANKLIN D. ROOSEVELT, FMR. PRESIDENT OF THE UNITED STATES: We had to struggle with the old enemies of peace: business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering. They had begun to consider the government of the United States as a mere appendage to their own affairs.

And we know now that government by organized money is just as dangerous as government by organized mob. Never before, in all our history, have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me. And I welcome their hatred.


OLBERMANN: And there, Mr. President, is your template. Welcome their hatred. Seize the mood of this nation, identical tonight to what it was in 1936, nearly, as Mr. Roosevelt perfectly captured it. "Government by organized money is just as dangerous as government by organized mob." And aspire also to what he added. "I should like to have it said of my first administration that in it the forces of selfishness and of lust for power met their match."


OLBERMANN: The last time the president addressed the joint session of Congress in September, a House Republican interrupting him to call him a liar. This is how far that party and political decorum have fallen in this country. The headline repeated around the country today via the Associated Press: "Congressman Joe Wilson promises he will not interrupt the president this time." Gee, thanks.

Greg Sargent's blog, "the Plum Line," reporting House Republican leadership, in fact, held a private meeting this morning directing the rank and file to avoid any outbursts tonight, encouraging them to provide the president their respect. For his part, Mr. Wilson telling the AP he'll been on his best behavior, because, after all, he claims to be a, quote, gentleman.

Perhaps he'll be able to restrain his political Tourette's because so many headlines, like spending freezes, minimizing health care reform, are not something the Republicans can really object to.

But the latest numbers from the NBC News/"Wall Street Journal" poll suggest the president himself is in a kind of post-partisan bubble, and everyone else isn't, with more public support from the GOP or his own party. Only 27 percent blaming the president for the country's problems;

48 blame the Republicans.

More people saying they will use their vote in the midterm elections to send a signal of support for Mr. Obama than as a signal of opposition. The public's disdain for Congress reaching further; 93 percent saying there's too much partisan fighting, and 84 percent believing special interests have too much influence over legislation. Sixty one percent said that both Congressional Democrats and Republicans are not willing to compromise.

Joining me now, the associate editor, Pulitzer Prize-winning columnist of "The Washington Post," MSNBC political analyst Eugene Robinson, as we see the motorcade arriving at the Capital. Gene, good evening.


OLBERMANN: A lot of those poll questions can be easily dismissed as, you know, Republicans think there are Democratic special interests that control the whole thing, and Democrats believe Republicans are responsible for the bickering. But there is a trend there. And I think the big trend about people's assessment of congress begs the question, with whom is the president going to compromise tonight and why?

ROBINSON: That's a good question. If you take the poll numbers at face value, the president should, you know, say a pox on this entire house, and he should tell him to pay attention to what he wants to do rather than what they might want to do, and certainly to stop the bickering.

I do think that finding that people don't blame him for what they see as the excessive partisanship in Washington is really significant. And it gives him a continuing opportunity to take control or take back control of the message, of the dialogue, and move it forward in a progressive direction, what I would hope would be a progressive direction.

OLBERMANN: Even if it's not moving it forward, and just keeping it where it is, what is it? What is going on here? What does the White House see that we do not? Or are they seeing something that doesn't really exist?

ROBINSON: Well, I think one thing the White House sees is the disgust that so many people have about the partisanship, about the bickering. And I believe one of the reasons that only 27 percent of Americans, according to a poll, blame Obama is that they have seen him reach out, again and again and again, to the Republicans.

So, as a matter of theatrics, I think it's good politics. My question is, as a matter of policy - at some point, if health care is as important as the president says it is, as I believe it is, at some point, you've got to get it done. At some point, you have to say, OK, process be damned, but we have to get it done. My question is, when does he reach that point? But as theatrics, I think it is good politics.

OLBERMANN: And as we know, the people at home are not looking at this and saying, this is the State of the Union tonight; that's entirely different from the last time he was there in September. That was not a State of the Union, therefore you can't compare the two speeches. People at home say, this was a speech in the exact same setting that was 100 percent about health care. Tonight's might be, generously, 10 percent about health care. Did Joe Wilson win?

ROBINSON: I don't think you could say that Joe Wilson won. And I actually don't think it's necessarily going to matter a lot whether he devotes five percent of the speech to health care or three percent or 13 percent or whatever. I think what's more important is not how much he says, but what he says. Does he give a clear indication that he really wants Congress to proceed, or does he - or is it more like mush? Is it like, well, maybe we can do a partial this or a partial that.

So I think clarity will be more important than how many words there are.

OLBERMANN: All right. We're talking within the confines of what we think we know is going to happen. What would your -

ROBINSON: Exactly. And we don't know.

OLBERMANN: What would your blank slate advice be to this president at this point relative to this speech?

ROBINSON: You know, my advice would be that 27 percent number, that is a good number in this political atmosphere. You can regain control of the dialogue, and you can move ahead.

And people like you. People want you to succeed. And you can take that to the bank, basically. You've weathered the storm in that sense. So move ahead on your agenda, with talk about jobs, because people want to hear about jobs, but in the context of why your agenda is good for jobs.

OLBERMANN: You're good enough; you're smart enough; and dog gone it, people like you. It would be fitting in this setting with the new senator.

ROBINSON: The Stewart Smally (ph) State of the Union Address.

OLBERMANN: Yes. Eugene Robinson of "The Washington Post" and MSNBC, always a pleasure. Thank you, sir.

ROBINSON: Great to be here.

OLBERMANN: I have just suggested that a president who might talk past congress, past the media, directly to the people tonight, tell them what they want to hear or address it at least. What is it we want to hear? What is it - I hate this word - the Zeitgeist. Rachel Maddow, Chris Matthews and the State of the Union next on MSNBC.


OLBERMANN: We are within eight minutes of the scheduled starting time of the president's State of the Union Address. I wouldn't make book on that. The president's motorcade has arrived at the Capitol. He is in the holding room now, with Valerie Jarrett and David Axelrod. You see the House chamber filling to capacity. Every year, of course, a small group of lawmakers treating like this like the opening of the "Star Wars" movie, or the line for the new Apple tablet, the inelegantly named iPad, staking out aisle seats more than 13 hours in advance, to ensure the good photo op during the president's walk out.

My friend, Congressman Engel of New York, has not missed a good seat since Reagan's last full year, and his streak is in tact tonight. This is the president's third address to Congress, technically his first State of the Union Address. Eleven months ago, he first addressed a joint session. At that time, there was still one Republican senator from Pennsylvania and Ted Kennedy, who devoted his 50 years of life in public service to passing health care reform, was still the senior senator from Massachusetts.

By the time of the president's second address to Congress, health care reform was the sole item on the agenda. Tonight, the president is expected to make it a part of his larger treatment of the economy and the jobs. And as we wait for the Supreme Court to file in, joining me now is the host of "Hardball," Chris Matthews. Good evening, Chris.


OLBERMANN: All right. One of your White House lunch mates, Katie Couric, Tweeted today, just - off the record, "just had lunch with the president, who seems pensive, slightly deflated, realistic, aggravated, and resolute. Didn't eat his pie." I think I can reveal that when I was at the lunch in the White House in October, the president did not eat his cobbler. You were with the president today. What is the meaning of his skipping dessert?

MATTHEWS: Well, I don't know. It's off the record. I don't even care about this stuff. Look, it's important - I wrote in my notes there today, this is important. He is going to try to regain the traction, as we call it in politics, of this country's politics. And he's going to try to do it tonight by putting his foot on the pedal on jobs.

He is going to press the Congress to pass a big-time jobs bill. He's going to do it again. It's going to cost higher deficits, but he's going to do it. And I think that's going to be they headline in tomorrow's papers. That's the headline.

The second headline is he's going to try to find Republicans to join him on health care. He failed before. He's going to try it again.

Third, he's going to push for an end to the Don't Ask, Don't Tell concept over at the Pentagon. He's going to ask for free open service by people who are gay in the military. So those are the three things that I can tell you, coming out of the lunch today.

OLBERMANN: The First Lady has arrived. Will there be big themes, big words? I mean, you heard that Roosevelt clip I played earlier from 1936, anything like that? Is this the time for speech?

MATTHEWS: Keith, you make me think - and I loved Roosevelt in '36, and he spoke at Franklin Field and gave that great speech. And I have to tell you, that one in Madison Square Garden you quoted from is equally wonderful.

The times have changed in two regards. They may change again. One is really important. Hoover was in office under the Republicans for four years and proved to every single American that the Great Depression was Republican doing. It was totally their fault. Nobody could walk away. So by the time it was 1936, you had 70 Democratic senators, on the way to 76 Democratic senators. One party had taken the complete responsibility for the Great Depression. The other part was clean handed. And that's why the president could be that divisive effectively.

The second thing is - and this is one of the great ironies of the life you and I lead and have benefited from. The Democrats, through the Great Society, through the New Deal, through the New Frontier, created a middle class, through student loans, through social security, through job production. Everything that they did was to create a middle class. And now we have one. We didn't have a middle class in '36. We had working poor people and a few very rich. If you wanted to start a fight, you definitely started a fight the way Roosevelt did.

Today, if you try to talk like Roosevelt, you'll find the slightly better than middle class people saying, my god, he's coming for my money to pay for the people slightly below middle class. And I'm telling you, that's the problem. The Democrats benefit - I'm sorry, they suffer from what they gave to the American people, which is a middle class. And you can't rabble rouse with a middle class in this country or they will get spooked.

OLBERMANN: But if there is any consensus in this country at this moment, if there is - I hate the word Zeitgeist. But if there is one, it is people versus big fill in the blank, big corporations, big insurers, big government.

MATTHEWS: I'm with you on that one.

OLBERMANN: Is there a way to grab that?

MATTHEWS: I would get rid of Geithner. I think he represents, in his dress and his manner - and it's not his fault, perhaps. But he looks like Wall Street. Unfortunately, the people around the president in the economic area seem like Wall Street. He doesn't look like he's adversarial enough. I don't mean yelling at them. I mean fighting with them over policy.

I do think he suffers from the AIG bailout even now. I think he suffers from who benefited from that bailout, Goldman Sachs. I agree with you. But, you know, you deal with who you got. We don't have an angry president. We have a president who sees the other side.

He's not you, Keith. You can demand that he be you. And maybe you should change parties and dance here. But I've got to tell you, it's not the role he feels comfortable playing. It's obvious looking at him.

OLBERMANN: No, I love my country. I wouldn't wish that on -

MATTHEWS: I wouldn't either, honestly. But anyway -

OLBERMANN: Stand by a second. As the speech approaches, a few housekeeping notes here. Chris and Rachel will be with me for the night for analysis here. Then after the speech, we'll be bringing you the Republican response in its entirety. That will be followed by a special late edition of Countdown around 10:30. Among my guests, White House senior adviser David Axelrod and Congressman Anthony Weiner. That will be followed by a live edition of "THE RACHEL MADDOW SHOW", beginning at about 11:30.