'Countdown with Keith Olbermann' for Oct. 8
video 'podcast'

Guests: Rajiv Chandrasekaran, Michael Musto, Jonathan Alter, Dana Milbank, Richard Wolffe

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KEITH OLBERMANN, MSNBC HOST: This is "Countdown." I'm Keith Olbermann. Happy Columbus Day. I actually got the day off, some sort of clerical error. But I'll be back tomorrow night, Tuesday. David Shuster fills in, if you'd kindly give him your attention.

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DAVID SHUSTER, MSNBC GUEST HOST (voice-over): Which of these stories will you be talking about tomorrow?

As the nation goes, so goes Iowa. Hillary with a huge lead nationally opens up her first lead in the Hawkeye State. Can anything stop the momentum?

Speaking of the big mo, when is Fred Thompson going to find his campaign mojo? His laid back routine is already getting lampooned.

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DARRELL HAMMOND, ACTOR, "SATURDAY NIGHT LIVE": How badly do I want to be your president? On a scale of one to ten, I'm about six.

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SHUSTER: D.C. might seem a lonely place for the neo-cons who led us into the Iraq war. So why is Giuliani stacking his campaign with them?

A bad day for surge supporters. Reconciliation, Iraqi leaders say it ain't going to happen.

Troops bringing security. The British premier says less troops is leading to less violence. How long will it take the U.S. to embrace these realities on the ground?

The torture memos. Was Congress briefed? House Speaker Pelosi joins the ranks of Congress saying no. The White House - well, take a guess.

The Diana inquest. Jurors travel to Paris to retrace the route on the night she died.

And from the people's princess to pop-tart. Britney's royal delusion? She'll suffer the same fate as Diana, running from paparazzi, having two kids, being blond - some of the time. The parallels are endless.

All that and more you in, on Countdown.

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BRITNEY SPEARS, SINGER: Uh, where have I been?

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SHUSTER (on camera): Good evening, everybody. I'm David Shuster in Washington. As you may have heard earlier, Keith Olbermann has the night off.

When you're in the race for the White House, nights off are few and far between. In the 2008 campaign, it has been an especially long haul with still three months go before the voting even begins.

Our fifth story in the "Countdown," nobody said running for president would be easy. Senator Fred Thompson has learned the hard way that applause sometimes has to be asked for. And that immortality on "Saturday Night Live" often comes with a price.

On the Democratic side, Senator Hillary Clinton finds herself facing good news and tough questions. The one sure thing in this campaign, at the end of it, this man, George W. Bush will no longer be president. The race to replace him is now taking shape in Iowa. Senator Clinton out in front in the latest survey from the "Des Moines Register". The first time she's taken the lead in a poll in that state. Senators Edwards and Obama are not far behind.

The big news on the Republican side, the man in second place, a relative newcomer, Senator Thompson, is emerging as the nearest competitor to Governor Mitt Romney. That's the good news for Senator Thompson. The bad news, he's finding the grueling pace and tedious nature of the campaign trail difficult.

Last week the "New York Times" reported that the "Law & Order" actor, quote, "did not appear to have much interest in the small talk that is a staple of campaigning." Thompson, said the newspaper, often lulled audience into kind a stillness. As a result, on one occasion, he actually requested applause.

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FRED THOMPSON, (R), PRESIDENTIAL CANDIDATE: I appreciate very much you being here today and listening to me give my thoughts about this. I will - first of all, could I have a round of applause? I had to drag it out of you, but now that we're here, let's talk about what you want to talk about.

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SHUSTER: It the kind of behavior that usually leads to a Darrell Hammond spoof on "Saturday Night Live." This weekend was no exception.

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HAMMOND: How badly do I want to be your president? On a scale of one to ten, I'm about a six. Look, I'll be honest. Running for president is a lot of work. I may not be up for it. Also, I don't particularly like talking to people.

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SHUSTER: We always particularly enjoy talking with our own Dana Milbank, national political reporter for the "Washington Post."

Good evening, Dana.

DANA MILBANK, NATIONAL POLITICAL REPORT, "WASHINGTON POST": I give you a round of applause, David.

SHUSTER: Dana, how important will tomorrow's debate be for Senator Thompson and how much pressure is really on him?

MILBANK: An extraordinary amount of pressure. All his own doing by skipping the previous debates and being out of the race for so long. The question is he a paper tiger? On paper, he looks good. You just mentioned his strong performance in that "Des Moines Register" poll in Iowa. He checks all the right boxes for the conservatives. Now can he get out there and actually look like he means it on the stump? He's not been able to do that so far. All eyes will be on him tomorrow.

SHUSTER: We also learned today that former Senator George Allen will serve as a co-chairman for the Thompson campaign along with Spencer Abraham. Why Senator Allen? Is there some kind of anti-macaca vote in the 2008 primaries?

MILBANK: Possibly, Larry Craig and David Vitter were not available. It raises questions about the judgment there. But if we're looking at it in a serious way, this may be part of Thompson's effort to play something of a southern strategy here if he's figuring that there's going to be a lot of division among Republican primary voters. He wants to do as well as he can in the south. This probably won't be the sort of thing that helps him should he survive the primaries, but definitely he's trying to play for the southern vote right now.

SHUSTER: On the Democratic side, the "L.A. Times" reports that Hillary Clinton's polarizing image is working to her advantage. Voters are heading to her campaign appearances with low expectations and, once they get there, their finding themselves pleasantly surprised. Is it bad news for Clinton's challengers that once they meet her, the reaction is, oh, she's not that bad?

MILBANK: I'm picturing the bumper sticker, Hillary, not as bad as you think. Now, not necessarily a winning slogan here. There's also a limited number of people who actually see her in these retail settings and even fewer as the campaign goes along. So I don't think you could place a whole lot of credibility in the notion that she's, in fact, not as bad as you think.

SHUSTER: Dana, tell us about this incident in Iowa, the, hey-she's-not-bad factor can tend to be undone when Senator Clinton ends up fighting with a voter with a tough question as she did yesterday in Iowa. Apparently, the voter asked her to explain her vote on the Kyl-Lieberman Amendment, which authorizes the president to ratchet up the pressure on Iran. Hillary sort of snapped and suggested it was a planted question. What happened with all of that?

MILBANK: Well, it's a mistake particularly because it's in Iowa where her lead is not as great as others. However, this is the sort of thing that's likely to be forgotten fairly quickly as the campaign goes along. You never want to demean the voter who is asking you a question. And on the other hand, she gave sort of an instinctive response. She's correct in the sense that this Kyl-Lieberman proposal, nonbinding, was not seen as particularly a big deal. But it has got the left wing on fire here. That's sort of a sore point for Hillary Clinton.

SHUSTER: Dana, the original follow-along was supposed to be that Barack Obama was the one that would really suffer from expectations. That he's so popular and has this national appeal that when people saw him - and he's still a relative new-comer - that they would be let down because the expectations for him are so high. Are we seeing the reverse? People think the worst of Hillary, they see her, she gives a great speech and they come away thinking, wow, that was impressive.

MILBANK: The expectations game only works so far. When people think they see a winner, they'll all get on board. That's what we saw from the "Washington Post" poll from last week, even in areas where people thought Hillary was the weakest in terms of her polarizing the electorate. Suddenly, they were seeing these things as strength. So I think the expectations game only takes us so far.

SHUSTER: Dana Milbank, of MSNBC and "Newsweek, thank you for your time tonight.

MILBANK: Thanks, David.

SHUSTER: The latest poll results in Iowa are not kind to Rudy Giuliani, who now finds himself in fourth place or, if one is being kind, in a close race for third. Mayor Giuliani gave up on the Hawkeye State a long time ago. He seems to feel that just being a hawk will prove to be enough.

"Newsweek" magazine reports that many of the neo-cons who brought us the invasion of Iraq are now working on the Giuliani campaign. This foreign policy team littered with the biggest names that have gotten a bad name because of the war in Iraq, including the father of the neo-conservative movement Norman Podhoretz, who last week revealed that he recently spent time advising President Bush to launch air strikes against Iran.

Let's bring in our own Jonathan Alter, a senior editor at "Newsweek".

Good evening, Jonathan.

JONATHAN ALTER, SENIOR EDITOR, "NEWSWEEK": Hi, David.

SHUSTER: Jonathan, can we conclude anything from this list of neo-con advisers that the Giuliani campaign is betting that terrorism-9/11-national security is the best strategy Giuliani has for winning the GOP nomination?

ALTER: Absolutely. He's out of step with Republican primary voters on a host of other issues, from abortion to gun control to gay rights. But on national security, he's right in that mainstream, very hawkish, focused on projecting American power abroad. He'll try to ride that all the way to the Republican nomination.

SHUSTER: But given how unpopular the war in Iraq is and it's increasingly unpopular on the Republican side and given how disastrous the interventionist foreign policy has come to be, since Giuliani is bettering that the American publish is happy with the way the Bush administration has been doing things, and wants more of the same, wouldn't that be a risky strategy, if not an outright stupid one?

ALTER: You can argue that in the general election, which is why the whole conventional wisdom on Giuliani has flipped. The assumption last year or earlier this year was that he would have a hard time getting the nomination, but if he did, he would be a shoo-in to get elected.

Now it's flipped. People think he has quite a good shot at getting the nomination, but for reasons you describe, might have a lot of problems getting elected in a country that's anti-war and doesn't want a lot more of the same.

Basically, if Giuliani is elected president, we very likely will have another war. A referendum on that could go badly for Giuliani because the last war didn't go so well.

SHUSTER: One of the reasons why of these neo-conservatives, like Norman Podhoretz are available as consultants, is because no other campaign would have them. These guys aren't exactly the most popular bunch, are they, especially in conservative circles?

ALTER: They've been discredited. They are the folks who brought you the Iraq war. They are the people who told you it was going to be easy. They're the one's who are saying let's go on offense and, you know, hit the Islamic fascists wherever we can and that war is an answer. That's their position.

Now, that doesn't mean they're wrong on all the particulars, with everything they say. There's certain neo-conservative arguments over the years that have had a grain of truth to them. But in total, their policy has been discredited. Podhoretz wants us to launch war with Iran right now. And Bush has said no. He had a meeting with him, declined to do so. Said they want to give diplomacy more time. That's the man who has got the ear of Rudy Giuliani.

SHUSTER: Jonathan, does that suggest that Rudy Giuliani might have dad trouble finding support among traditional foreign policy conservatives who are wary of the Giuliani team?

ALTER: I don't think so. I think that neo-conservatism is the foreign policy of the Republican Party. People who are wary of the Giuliani team tend to be, if not Democrats, at least Independents, those who vote for Republicans sometimes and have worked in some Republican administrations but are not, you know, we're in the center of the party.

Part of what's happening here, David, is that the so-called values voters are seeing Giuliani's hawkishness as a values issue and projecting American values abroad. And so some folks who disagree with him in the Republican party on a lot of other thing so respond to this hawkishness, this bellicose attitude, that they're going to hold their noses and vote for him even though they're not pro-choice.

SHUSTER: Jonathan, having said that, is there a danger for Rudy Giuliani to come across as essentially a one trick pony?

ALTER: Well, you know, I've said this before, Keith, and I've talked about it. Sometimes you feel like the subtext of his campaign is - to paraphrase Franklin Roosevelt, the only thing we have to use is fear itself. So he's playing a fear card here. He's talking a little about taxes and some other issues, but this is mostly a 9/11 campaign.

SHUSTER: Jonathan Alter, of MSNBC and "Newsweek," thanks for your time tonight.

ALTER: Thanks, David.

SHUSTER: This programming reminder, that tomorrow's debate can be seen live on CNBC at 4:00 p.m. and it will be rebroadcast here right after "Countdown."

The fight over the torture memo. Someone's got to be dodging the truth. The White House says Congress was fully briefed, but even more politicians on Capitol Hill say it's simply not the case.

And forget reconciliation in Iraq. Members of Iraq's government admit reconciliation isn't even in the cards for them. What new reason will we come up with keep our force there?

You're watching "Countdown" on MSNBC.

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SHUSTER: A White House story that members of Congress were briefed about a secret memo and interrogation policy continues to fall apart. In our fourth story on the "Countdown,", now the most powerful Democrat in the country, House Speaker Nancy Pelosi, has added her name to the list of Democrats who say, no, the subject never came up.

After the "New York Times" reported last week that a secret Justice Department memo in 2005 opened the door to harsh interrogation tactics that some call torture, despite president Bush foreswearing such tactics months before, Senate Intelligence Chairman Jay Rockefeller complained he was not briefed on the new old policy.

White House Press Secretary Dana Perino said Friday appropriate members of Congress were, quote, "fully briefed."

Over the weekend, House Speaker Nancy Pelosi said, no, she also never saw the new secret memos.

And Congresswoman Jane Harmon, the ranking Democrat on the Intelligence Committee in 2005 says she was not fully briefed, according to a report on the progressive blog Think Progress.

Joining us is Richard Wolffe, an MSNBC analyst and White House correspondent for "Newsweek."

Richard, thanks for joining us.

RICHARD WOLFFE, WHITE HOUSE CORRESPONDENT, "NEWSWEEK": My pleasure, David.

ALTER: Richard, who is telling the truth here?

WOLFFE: Well, that's the problem with torture, you never know who is telling you the truth.

Look, what we have here is a situation where both sides are spinning behind the scenes. The White House is saying on this, as it did on warrantless wiretapping, that members of Congress are essentially lying in public and that they want the deniability. They want to be able to say, we never knew. Of course, on the other side members of Congress are saying the White House is lying.

Given the administration's record, given the searing experience of Abu Ghraib and the damage that this does to America's reputation around the world, there's a clear onus on the White House to be as open as humanly possible. We're still not seeing an openness that suggests that they have learned the cost of Abu Ghraib.

And so I say, again, the ball is in the White House's court. They need to prove the case rather than members of Congress needing to state it.

SHUSTER: Did Speaker Pelosi leave wiggle room in her remarks yesterday? How plausible is it that Democrats did get a nudge, nudge heads up, but don't want to acknowledge it now because they didn't do anything about it at the time?

WOLFFE: Well, it is plausible that members of Congress understand that every president, Republican and Democrat, will want extremists to have the right to do whatever it takes. The question is, what is standard operating procedure and what is an extreme tactic?

It's like the nuclear option. And I mean the literal nuclear option. Presidents always have the right to drop the nuclear bomb. The understanding is that it will almost never happen. So the question is, did members of Congress know that this was possible or did they know that this was really a regular occurrence? And that's, again, something that's unclear from everybody's remarks.

SHUSTER: Richard, on a practical level, does the White House even care what Congress knows? What would Congress do if it did know?

WOLFFE: Well, the White House does care in a sense. The president has told me and many others that he wants to set up basically the infrastructure for whatever war we're in. Norman Potter called it World War Four or Five. He thinks that he is setting up this Truman-esque infrastructure for this war against global jihadism to continue for many decades. So he thinks locking in Democrats here, getting their ascent for the next president, who he actually thinks is going to be Hillary Clinton, that's an important thing. So he does care because he thinks that's his legacy.

SHUSTER: Dana Perino won't say what torture means. She can't say what fully briefed means. Sometimes it sounds like we're going back to the definition of is, is. But as far as this administration is concerned, are we back to the pre-Tony Snow days, when the press secretary was deliberately kept out of the loop or even knowingly given false information?

WOLFFE: I think Dana knows what the situation is here, but there is a question about the message she's sending and the White House is sending to the rest of the world. The president has said freedom is his legacy in a second term. He needs to be clear what freedom and liberty means to the rest of the world, just as he needs to be clear to the American people.

SHUSTER: Richard, as far as what Congress does now, is there an appetite in Congress for any sort of follow-up or picking a fight with the White House over all this?

WOLFFE: I suspect this one may wither away here. You know, to the extent that people are talking about it, I have to say from my travels on the campaign trail, there is no bigger applause line for Democratic candidates than to talk about torture, Guantanamo Bay and Abu Ghraib. This is a great subject. I expect the candidates will talk about it. Members of Congress, I'm not so sure.

SHUSTER: Yet, one wonders whether or not the public will actually hear how all this came down if more people from the Justice Department administration don't talk about it.

But in any case, Richard Wolffe, of "Newsweek" and MSNBC, thanks for coming in tonight. We appreciate it.

WOLFFE: Thank you, David.

SHUSTER: The British inquest into the death of Diana heads to Paris and the people of Paris are getting tired of the constant investigations.

The Arizona Diamondbacks have their way with the Cubbies and decide to add a little insult to injury at the same time. Details ahead, in "Oddball."

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OLBERMANN: Hi. It's Keith Olbermann again. This is still "Countdown" and I'm still off. And I still promise I'll be back tomorrow, on Tuesday. But now we both get to see how David Shuster does the "Oddball" section. Take it away, David.

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SHUSTER: Good grief. Keith, in your honor, allow me to digress momentarily so I can tell your loyal viewers, that on this day in 1871 on this date, the great Chicago fire began. Also on the day in 1934, Bruno Hauptmann was indicted for the murder in the death of the Lindbergh baby. But most importantly, on October 8, 1950, Cool was born. That's Robert Bell, aka Cool, who along with his gang, continue to rock the dance floor at weddings and bar mitzvahs around the world. Not mine, of course, but in the spirit of the party going on right here, let's play "Oddball."

And we begin with the kiss cam from Chase Field, home of the Arizona Diamondbacks. And if sweeping the Chicago Cubs over the weekend was not enough, Sunday, Arizona poured salt in the wound. Hiring a Steve Barkman look-alike to sit in the stands while the song "Mr. Lonely" played on the stadium's Diamond vision. The camera pulled out to reveal to a goat. And it is the kiss cam, so fake Barkman kissed the real goat. Better luck next year, Cubbies.

To the Sandbar (ph) Hotel in Miami Florida, the scene of today's big nude pool photo shoot. 800 participants wrangled by artist Spencer Tunick, all scheduled to take everything off and have their bodies captured on film. "Oddball" cameras were rolling during the lead up to the photo session, and we can now show you the following exclusive footage of 50 naked dudes lying on rafts in pool. There you have it, heavily pixilated. In fact, it's completely pixilated. That could be anything really, but you'll have to trust us. It's naked men. Sorry, folks, you will have to buy the Tunick prints.

The naked truth in Iraq. Elected Iraqi officials, point blank say, there will be no reconciliation. So the surge continues why?

And another bizarre leap of logic. Britney Spears likens herself to -

wait for it - Princess Diana. We'll just let Michael Musto hit that one out of the park for us.

Those stories ahead, but first, time for our goofballs and good guys.

Here are "Countdown's" top three best persons in the world.

Number three, best teenage beauty pageant contestant, actually fifth best. 14-year old Chelsea Gledhill (ph) entered an on-line beauty pageant where people text-messaged their favorite teen. Gledhill (ph) got almost 2,000 votes, mostly from herself. Unfortunately, standard text messaging rates applied. So she got a $2,300 phone bill along with her fifth place finish. Chelsea's parents, not very happy.

Number two, best unofficial cease-fire. In the Philippines, the fighting between the government troops and Marxist and Muslim insurgents was briefly halted for a time so everyone could watch a boxing match. In a 12-round unanimous decision, the pride of the Philippines, Manny Pacquiao beat Marco Antonio Barrera in Las Vegas on Saturday. The warring factions laid down their weapons to watch.

And number one, best inductee. On October 13th, the Idaho Hall of Fame is set to induct as its newest member Senator Larry Craig. The decision was made before Craig's guilty plea stemming from his alleged solicitation of sex in an airport bathroom. The Hall says they will go through the induction as planned. And as a consideration to the Senator, the Hall will make his plaque extra wide and hang it nears the men's room. Just kidding on that last part.

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OLBERMANN: This is Countdown. I'm Keith Olbermann. A quick reminder, I'm off tonight, even though you're seeing me here tonight, which kind of counters my argument that I'm completely off tonight. But I will be back tomorrow. In the interim, again, David Shuster.

SHUSTER: In June, when President Bush spoke about his military escalation in Iraq, he said its goal is to help the Iraqis make progress toward reconciliation. Unfortunately, in our third story in the Countdown, the top leaders in the Iraq government are now saying that goal, reconciliation, is unattainable. In fact, they are saying it never has been attainable and never will be attainable, unless some stability in government happens first.

Top Sunni and Kurdish leaders have now told the "Washington Post" that sectarian differences run too deep to achieve any kind of national government unity, that even the concept of reconciliation causes deep rifts. To Sunnis, it means a greater role in making decisions for the country. To Shiites, it threatens a return to Sunni control reminiscent of Saddam Hussein. According to top leaders, the government is so divided along sectarian lines that skilled civil servants are ignored in favor of political flacks, not to mention that the current emphasis on sect was engendered in part by the U.S. decision in 2003 to hand pick the first Iraqi government along ethno-religious lines, in an effort to reflect the make up of the population.

I'm joined by Rajiv Chandrasekaran, author of "Imperial Life in the Emerald City," and an assistant managing editor of the "Washington Post." Thanks for your time tonight.

RAJIV CHANDRASEKARAN, "THE WASHINGTON POST": Good evening, David.

SHUSTER: Quoting the deputy prime minister of Iraq, Barham Saleh, he says I don't think there is something called reconciliation and there will be no reconciliation as such. So just how does President Bush plan to bring around reconciliation if no one in Iraqi politics even wants to be reconciled? Isn't that like trying to keep a couple together when they've already filed for divorce?

CHANDRASEKARAN: Totally. This is going to force a major re-evaluation of the U.S. strategy in Iraq. The whole troop surge was based upon this notion that you provide security so that political leaders can go about the process of reconciliation. But now you have senior Iraqi political leaders saying this is not possible, then what do you do? What's clear here is that the Shiite and Kurdish leaders believe that reconciliation means giving up too much to the Sunnis.

The Sunnis see reconciliation - see progress on things like an oil revenue sharing law, on easing rules on de-Baathification, as essential in trying to build some sort of consensus and harmony in the country. And, of course, the U.S. government has wanted this because they want to bring the Sunnis into the fold.

David, as you know, much of this dates back to the wacky world in the Green Zone after the 2003 invasion. As I detailed in "Imperial Life in the Emerald City," what the first wave of American occupation personnel, led by Ambassador Paul Bremer, did was they focused on choosing Iraqi political leaders based on their sect, as opposed to based on people who were moderates, based on people who had subject matter expertise to run the government. They chose people who had the interests of their respective group ahead of the interest of the nation.

SHUSTER: Rajiv, according to the president, the whole purpose of the surge, the purpose of General Petraeus' mission right now is to engender political reconciliation. If that's not on the cards, what now? Can U.S. troops do anything if the national political process is at a stalemate?

CHANDRASEKARAN: I suppose U.S. troops can continue what they're doing already, which is trying to broker local security deals to try to improve the situation in various neighborhoods and various provinces in Iraq. The most notable of this is what the U.S. military is doing out in Anbar Province, by striking deals with Sunni tribal leaders to go after al Qaeda-linked militants. It has been showing some signs of success.

But remember here, these are deals done with individual sectarian groups. This is not going and dealing with the overall national army or national political leaders.

SHUSTER: Well, to the extent that Anbar is making progress, isn't it also true that some of this backing down, as far as backing away from the violence, is because U.S. forces are essentially giving amnesty to some tribes that were previously killing Americans?

CHANDRASEKARAN: Indeed, and that's very controversial in Iraq. Prime Minister Nouri al Maliki and members of his government have strongly criticized what the United States military is doing in Anbar Province. They believe it's giving aid and comfort to Sunnis who might one day turn on them. So while this strategy is hailed by the White House as a sign of success, in Baghdad it's incredibly controversial and it may be winning us more enemies than friends in the Capital.

SHUSTER: One of the things that did happen in the American capital, of course, is the Bush administration strongly criticized the U.S. Senate for endorsing Senator Joe Biden's suggestion to support the partition of Iraq along Shiite, Sunni and Kurdish lines. But to listen to Iraqi politicians, it seems like Iraq is already deeply divided along those lines in reality, if not on paper. So why not support Iraq becoming a decentralized state?

CHANDRASEKARAN: Well, you know, it's very embarrassing for the Bush administration because they went into Iraq with this notion that they were going to be able to create a country with a very strong central government, with very weak powers at the regional level. But this is the direction in which things are inevitably heading. We are moving, perhaps to partition, but to greater federalism, greater regional control.

To go back to your marriage analogy, perhaps it's not chopping the house up, but it is moving to a situation where the parties will have to sleep in separate bedrooms for a while, until they might come up with some sort of more meaningful method of reconciliation. It is the direction in which things are headed. The other day, a couple of weeks ago, the Senate measure had 76 members of the Senate supporting it, including 26 Republicans.

It is the Plan B that is starting to gain some momentum in Washington, even if the White House doesn't want to come out and embrace it right now.

SHUSTER: Rajiv, is it realistic to expect - to use that analogy again about a divorce - that never mind sleeping in the same bedroom, that some of these warring factions can at least stay in the same house? Is that realist?

CHANDRASEKARAN: It depends on how you structure the house. If you move to a model where there are far more powers put down at the regional level, much like the Republican party believes in states' rights, allowing the people in Anbar Province to have a greater say over their budget, for instance, allowing them to have their own effective National Guard, and making the central government fairly week. You could see a model where you could still keep an Iraqi nation together, but it would really be a confederation of various regions that are based largely on religious or ethnic groups.

That's a potential model here, but that's something that the U.S. government has been reluctant as of now to push the Iraqi leaders to embrace. That's something they might have to do in the future.

SHUSTER: Rajiv Chandrasekaran of the "Washington Post," thanks very much for coming in tonight. We appreciate it.

CHANDRASEKARAN: Good to talk with you, David.

SHUSTER: Thank you. Speaking of governments in trouble, officials in Atlantic City are scrambling to keep the town running after the mayor disappeared while under reported federal investigation.

And it's a road trip for the jury investigating exactly what happened the night Princess Diana died. They're all in Paris, literally, retracing her last steps. That's ahead. This is Countdown.

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SHUSTER: The probe into the death of a princess and the mayor of a gambling Mecca simply vanish share our number two spot in tonight's Countdown. First to Paris, where one of the biggest investigations in British legal history went to work today, trying to settle the issue of whether Princess Diana's death was accidental or assassination. NBC's Ned Colt is covering the Diana inquest in the city of light. Ned?

NED COLT, NBC NEWS CORRESPONDENT: David, it was a very odd scene here in Paris today, a full decade after Princess Diana and her boyfriend, Dodi Fayed, died in that car crash. Jurors retraced their last steps.

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COLT (voice-over): From a distance they could be a world weary group of tourists, taking in the sights in the world's most popular city by bus and on foot. But this afternoon, this pillar in a tunnel received much of their attention. Nondescript but for a missing foot long chunk of concrete, it marks the spot where Princess Diana and Dodi Fayed were killed. The handful of journalists allowed along with the Diana inquest jurors and lawyers had to keep their distance, but describe a moving moment.

SARAH HUGHES, SKY NEWS CORRESPONDENT: The jurors didn't ask any questions. They were very quiet as they went around. They sometimes went off in pairs. They sometimes talked to each other.

COLT: Twice today, they made the journey to the tunnel from the Ritz Hotel, where the couple spent their last hours, first in the afternoon, and again tonight. They saw traffic flow, road design and likely conditions the night of the crash. Then they took a bus to the hospital where Diana died.

All of this intended to provide perspective for the jurors in determining whether it was an accident or a complex murder conspiracy, as Dodi Fayed's father claims.

"Newsweek's" Christopher Dickey has investigated every element of the crash, starting that night ten years ago.

CHRISTOPHER DICKEY, "NEWSWEEK": Nothing has really changed the fundamental interpretation of the accident, which is a drunk driver going too fast, a crazy night, probably being goaded on by Dodi and Diana, who were fed up with the paparazzi.

COLT: Now, it's many Parisians getting fed up. There have already been two investigations, and, once again, cars are being towed and roads closed. Tifan Puerta (ph) was seven when Diana died. Today, she worried the investigation was going to make her late to her college class.

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COLT: That tunnel is just across the River Seine behind me here. Tomorrow, the jurors will visit the Ritz hotel. Later this week they will begin hearing testimony from French witnesses in London, again, testimony that is expected to go on for more than six months, David.

SHUSTER: Thanks, Ned. As far from Paris as you can get culturally is the casino town of Atlantic City, New Jersey, where 16 million dollars disappears from the pockets of gamblers every day. Now, the mayor of Atlantic City seems to have disappeared as well, cashing in his chips and leaving town. NBC's Rehema Ellis reports.

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REHEMA ELLIS, NBC NEWS CORRESPONDENT (voice-over): Atlantic City, a place famous for gambling, bright lights and political scandal, is now a city in limbo. The seaside town's mayor missing for nearly two weeks.

STEVEN YOUNG, COMMUNITY ACTIVIST: The door is locked. So we're locked out of city hall.

ELLIS: Mayor Robert Levy abruptly stopped showing up at City Hall. The only word from him, a 36-word statement issued by his aides saying that he was stepping aside for medical reasons. The mayor's duties are temporarily being filled by the city's business administrator.

YOUNG: We don't actually see you as an acting mayor. We don't see an acting mayor or nobody as mayor right now at all.

DOMENIC CAPELLA, ATLANTIC CITY BUSINESS ADMINISTRATOR: If Mr. Levy resigns, then there's a different venue. Until then, here I am.

ELLIS: Levy is reportedly being investigated by the feds for falsifying his military record. Last November, Levy admitted that he didn't serve with the Green Berets in Vietnam, as he claimed in campaign ads. The goal, prosecutors reportedly say, to improperly inflate his military pension.

Over the past 40 years, five Atlantic City mayors have either pleaded guilty or been convicted of a variety of criminal offenses. Half of the city's last half eight mayors have been investigated for corruption. The mysterious disappearance has set off a fire storm among elected officials. Community activist Steven Young tried to force his way past the city's police chief and into the mayor's office.

YOUNG: Please don't put your hands on me.

ELLIS: On the same day, Councilman Bruce Ward filed papers in court to remove Levy from office.

UNIDENTIFIED MALE: Would you please sign your acknowledgment of service. I'm serving you with these papers.

CAPELLA: I'm not signing anything.

ELLIS: New Jersey's Governor Jon Corzine is now looking into the question of succession.

UNIDENTIFIED MALE: The situation, as it is today, can't go on for any extended period of time.

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SHUSTER: Don't take off your gold chain and pinkie ring just yet. We're off to Vegas baby, with our nightly look at celebrity and entertainment news, Keeping Tabs. And finally, we can answer the question are they or aren't they? They are. In the case of Pamela Anderson, the rumors were true that she would soon marry Paris Hilton's former partner, Rick Solomon. "OK!" Magazine says the marriage was a quickie, ten minute ceremony, at the Mirage Hotel in Vegas last Saturday.

The bride was previously married to Kid Rock and Tommy Lee Jones, with whom she made a sex video. As for hubby number three, Rick Solomon is most famous as Paris Hilton's co-star in "One Night in Paris," that sex video that became a best selling adult DVD. I guarantee we will let you know if another video is in the works.

Speaking of highly suspect careers, a once outstanding athlete took another step towards sports oblivion tonight. Sprinter Marion Jones has been stripped of her three gold and two bronze medals she won at the Sydney Olympics in 2000. She also accepted a two-year ban, although she had announced her retirement after pleading guilty last Friday for lying to a federal probe of doping in sports.

Jones made a tearful apology to her competitors, but they weren't so forgiving. One Australian athlete called her a terrorist who made a lot of money cheating. Another athlete said that she - that she - defeated to be compensated.

Even for someone is so evidently living in her own reality, it's a bit of stretch; Britney Spears' latest claim that she's just like another princess who was once hotly pursued by the paparazzi, Princess Diana. Michael Musto joins us on that next on Countdown.

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OLBERMANN: One last reminder, I'm Keith Olbermann. This is Countdown. I was off tonight. I will be back tomorrow evening. Let's see if David Shuster can finish up strong.

SHUSTER: And Keith, after my read in that last segment before the break, anything should be an improvement.

But as you know, Keith, there is no stronger finish than a story about Britney Spears. In case you haven't noticed, Britney has a lot of problems. Or as we might say politely, she's got issues. Instead of just seeing it as pathetic, it could be called epic.

In our number one story on the Countdown tonight, that's what Ms. Spears wants us to think anyway, if it's true that she sees herself as comparable to Princess Diana. Full disclaimer, this one hails from the UK's "News of The World." But it says that Ms. Spears is obsessed with Princess Diana, and sees their lives as a strange mirror image of each other. Strange indeed.

According to a so-called friend, quote, she's turned one of the rooms in her house into a shrine to Di. There's photos, books and cheap souvenirs. Britney has told people she truly believes she and Diana share the same path, the same destiny. She's taken to surrounding herself with anything connected to the princess."

Miss Spears is even keen on buying Princess Diana's wedding dress, reportedly, or a copy of it. As for objectively measurable similarities between Spears and Diana, well, there's the paparazzi. Here we see Spears and her sister chased this weekend. We're not sure that Diana would have shared Miss Spears most recent job aspiration, that of bar tender.

TMZ.com reporting that when Spears stayed at the Viceroy Hotel in Los Angeles last Thursday, she chatted up the bar tender at the cameo bar there and then filled out an application. Let's bring in "Village Voice" columnist Michael Musto. Good evening, Michael.

MICHAEL MUSTO, "VILLAGE VOICE": Hello, David.

SHUSTER: We'll get to the Diana insanity in a moment. But let's start with the bar tending thing. So Miss Spears' application is now with hotel human resources, according to TMZ. But do you think Miss Spears did this as a lark or does she need some extra spending money?

MUSTO: I think she could use the tips and the access to the booze. This is a terrible idea, David. This is like Louis Anderson becoming a burger chef or Amy Weinhous (ph) working as a pharmacist, terrible idea.

SHUSTER: OK, how about the similarities between Miss Spears and Princess Diana? There's the paparazzi. They have both been blond, though Miss Spears isn't even that right now. They both had two son. But Michael, where do you go from there?

MUSTO: Well, I think Di did once grab a male dancer's crotch in the middle of a number, but it was more of a testicular exam. She also shaved her head once, but it was more for head lice. Of course, Britney did upset the queen, but I'm talking about the male hairdresser who wanted her to wear those blond extensions. So they're similar, but different.

SHUSTER: And as for the differences, here's a few: they had wildly different backgrounds; K-Fed is hardly a Prince Charles stand in; and I don't think Britney has much to say about land mines. What am I missing here?

MUSTO: Well, K-Fed does have big ears. Britney sometimes speaks in English, which lady Di did. And also, Britney did that bomb movie "Crossroads," so bombs, land mines. Why are you resisting, David? I mean, not since Jennifer Love Hewitt played Audrey Hepburn has there been such a connection.

SHUSTER: Another tid bit from that "News of the World" story is that people close to Britney are afraid to tell her how weird her Diana obsession is, because that might, quote, tip her over the edge. Really? A confrontation over Princess Diana could be the very thing to put her over?

MUSTO: Yes, at this point telling her to lay off the Chuck-E-Cheese could drive her over the edge. She's on a precipice, let's face it. So everyone's being very polite and saying, oh, Britney, yes, the Lady Di thing is terrific. It's as good as Michael Jackson and the Elephant Man.

SHUSTER: Getting back to the paparazzi that swarm Ms. Spears and her sister, an elephant pair, perhaps, some might argue, some woman came up and started screaming at Spears, quoting, nobody wants you in this neighborhood. You're making the neighborhood unsafe. The paparazzi actually defended Spears, shouting down the woman. But shouldn't we have some sympathy for this neighborhood resident?

MUSTO: Absolutely, I mean, everywhere Britney lives becomes a caravan of chicken wings, polyester and STDs, and people gathering around to photograph it all. I wish she would move back to New York, and the real estate values would instantly drop. I'm looking for a nice one bed room.

SHUSTER: There's also word, Michael, from "Access Hollywood" that Miss Spears has finally reconnected with her mother Lynn Spears, following all this bad news regarding the custody of Spears' kids. Is that just what Spears needs, Michael, to get back with her mom?

MUSTO: This is another terrible idea. This is like Lindsay reuniting with her father, Amy Fisher reuniting with Joey Buttafuoco, Paris and Nicole, Tori Spelling and Shannon Dougherty. When will this end? There is a reason these people parted. They're lethal together. Plus, Britney is called a bad mother, so what does she do? She reunites with her own bad mother. I don't get it.

SHUSTER: As Miss Spears heads into her next custody hearing and the launch of her new album and her next trip to Taco Bell or wherever she goes, what advice would you give her?

MUSTO: Absolutely nothing. "Give Me More" is a big hit, despite itself. She got rid of the annoying kids. Soon, she'll have Lady Di's wedding dress to rip up into a stripper outfit. Britney, don't change a thing. You're doing fine. Just wake up.

SHUSTER: And her album really isn't so bad. I mean, for all the criticism of her and the strange things she's doing, and her strange obsessions, it's actually selling, right?

MUSTO: The song went from number 68 to number three because it's so bad people are gathering around to buy it like a car wreck. By the way, all of this information is from "News of the World," which prints ridiculous stuff, like Pamela Lee is marrying Rick Solomon. Oh, she did?

SHUSTER: That's not ridiculous. That sounds like a video in the making.

MUSTO: Then it's all true.

SHUSTER: Michael, we appreciate you coming on tonight. Thank you very much. Anything we should be looking for next with Britney Spears?

MUSTO: I was going to say her death -

SHUSTER: Jesus.

MUSTO: - but that is much too macabre and that's a long ways off. I swear, it takes a lot of Chuck-E-Cheese to kill you.

SHUSTER: Michael Musto, thank you very much. We appreciate it. That will do it for this Monday edition of Countdown. I'm David Shuster in for Keith Olbermann. Keith will be back tomorrow.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END