'Countdown with Keith Olbermann' for Monday, June 23
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Video via MSNBC: Oddball, Worst Persons

Guest: Dana Milbank, Richard Clarke, Markos Moulitsas, Chris Hayes

KEITH OLBERMANN, HOST: Which of these stories will you be talking about tomorrow?

Terrorism helps Republicans. The McCain campaign on the prospect of another attack on U.S. soil. Says John McCain's top adviser, quote, "certainly it would be a big advantage for him."

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I cannot imagine why he would say it.

It's not true.

(END VIDEO CLIP)

OLBERMANN: But Charlie Black admits to "Fortune" not only would another terrorist act here in this country help McCain and the Republicans, but one in Pakistan last December already did. The assassination of Benazir Bhutto in December was, Black says, "an unfortunate event, and it helped us."

The nexus of politics and terror and John McCain. The political explosion with Dana Milbank, the unholy merging of counterterror and presidential ambition with Richard Clarke.

FISA and Obama. The pressure on the presumptive Democratic nominee to filibuster or strip out telecom immunity, unless he's waiting to criminally prosecute the telecoms from the White House.

And there will be unity. Cliche warning - when Senators Obama and Clinton campaign together for the first time Friday, it will be in the town of Unity, New Hampshire.

The Obama campaign picks up McCain economic adviser Phil Gramm's responsibility for the Enron loophole, and hits him over the head with it. While McCain steps in it - a proposal for a $300 million prize for a super, duper, battery-driven car.

(BEGIN VIDEO CLIP)

MCCAIN: I can pay for it by canceling three pork barrel projects that are unnecessary and unwanted.

(END VIDEO CLIP)

OLBERMANN: Wait, you already have $300 million of pork in your first budget?

And seven words I truly wish I didn't have to say on television. George Carlin is dead. He was 71. The great puncturer of rationalizations and political phonies.

(BEGIN VIDEO CLIP)

GEORGE CARLIN, COMEDIAN: I like moving in and really hurting them. I don't like this let's be cute and let's be clever. I like smashing them. That's the only way to take care of them.

(END VIDEO CLIP)

OLBERMANN: All that and more now on Countdown.

Good evening. This is Monday, June 23rd, 134 days until the 2008 presidential election.

The chief campaign strategist for Senator John McCain has told "Fortune" magazine that a terrorist attack on U.S. soil before the election would be a, quote, "big advantage" for the presumptive Republican nominee.

Our fifth story on the Countdown - the first rule of October surprise is, you do not talk about October surprise.

Senator McCain's immediate reaction upon learning what Mr. Black had said, quote, "I cannot imagine why he would say it, it's not true." The McCain campaign then claiming Mr. Black did not remember making the comments in "Fortune," Mr. Black himself deeply regretting the comments. Put them all together - Black deeply regrets something that his colleagues have claimed he could not remember.

Charlie Black admitting, actually admitting that news of terrorism was good news for Senator McCain in New Hampshire, and that more of the worst news we could possibly get would be more good news for the Republican nominee in the general election.

From "Fortune" magazine - "The assassination of Benazir Bhutto in December was an unfortunate event, says Black, but his knowledge and ability to talk about it reemphasized that this is the guy who is ready to be commander in chief, and it helped us. As would, Black concedes with startling candor, after we raised the issue, another terrorist attack on U.S. soil. 'Certainly it would be a big advantage to him,' says Black."

An unnamed senior McCain campaign official saying this afternoon that Black did not remember making those comments in "Fortune," but that he did not dispute them. The official adding that the context of Black's argument in the interview, an interview he apparently does remember giving, was that Senator McCain is favored on national security issues, and that any day national security leads the news is a good day for McCain.

Mr. Black himself issuing a non-apology apology, expressing only regret for remarks he may or may not have made. Quote, "I deeply regret the comments. They were inappropriate. I recognize that John McCain has devoted his entire adult life to protecting his country and placing its security before every other consideration."

At a news conference in Fresno, California, Senator McCain responding to a question about Mr. Black's comments, both by saying they are not true and by preemptively claiming that they might have been taken out of context.

(BEGIN VIDEO CLIP)

MCCAIN: I cannot imagine why he would say it. It's not true. I've worked tirelessly since 9/11 to prevent another attack on the United States of America. My record is very clear. The Armed Services Committee and pieces of legislation sponsoring with Joe Lieberman the 9/11 Commission so we could find out the causes and how to fix the challenges that we face in the security of this nation. I cannot imagine it, and so I would - if - if he said that - and I do not know the context - I strenuously disagree.

(END VIDEO CLIP)

OLBERMANN: The Obama campaign tonight calling Charlie Black's comments to "Fortune" a complete disgrace. Spokesman Bill Burton saying in a statement, quote, "Barack Obama welcomes a debate about terrorism with John McCain, who has fully supported the Bush policies that have taken our eye off of al Qaeda, failed to bring Osama bin Laden to justice, and made us less safe. The fact that John McCain's top adviser says that a terrorist attack on American soil would be a big advantage for their political campaign is a complete disgrace and is exactly the kind of politics that needs to change."

Time to call in first our own Dana Milbank, national political reporter for "Washington Post." Good evening, Dana.

DANA MILBANK, WASHINGTON POST: Good evening, Keith.

OLBERMANN: Is McCain scrambling because this is a horrific premise for any politician of any part, or is he scrambling because the Republicans do operate on this premise and want people to know it, but nobody is ever supposed to get caught saying it on the record?

MILBANK: Well, this is, to paraphrase Charlie Black, an unfortunate event. In fact, it's a classic case of Michael Kinsley's rule of a gaffe in politics - it's when you accidentally speak the truth.

And, of course, whether it's true or not, the McCain campaign believes that it is true. We, in the "Washington Post" poll asked 11 different issues. Terrorism is the only one where John McCain has a sizable advantage over Barack Obama, but only 4 percent of people now say terrorism is the top issue.

They need to make terrorism the top issue. They're not supposed to say it this way, though.

OLBERMANN: Are "it's not true" or "it's taken out of context," Senator McCain knee-jerk responses here, are they his knee-jerk responses to anything that does not fit the day's preset schedule, the agenda? I mean, regardless of whether there is truth or context having anything to do with it? I mean, they can drum up those charges sort of after the fact?

MILBANK: Well, I think that is sort of spin 101 as they were trying to sort of grasp how big this potential scandal was here, and I think as it became clearer throughout the day, there was more of a full-throated attempt to say, look, we're going to distance ourselves from this remark.

But the fact of the matter is, McCain can't really come out there and say, it's not true. It doesn't mean that he wishes for another terrorist attack, but it's an indisputable fact that they believe that anything that will bring terrorism front and center is good for him. It's the same thing that the president did in 2002, 2004 and 2006.

OLBERMANN: Let's put the shoe on the other foot, Dana. I mean, what would the reaction, do you think, be if Senator Obama's chief strategist or anyone even remotely connected to his campaign said that a terrorist attack on U.S. soil would benefit his candidacy? What kind of world would we be living in tonight?

MILBANK: Well, there would be all kinds of outrage, but I think more to the point, nobody would particularly believe it. So, it wouldn't take off to the same extent.

Now, we can debate whether the sort of fear campaign still works. It seems to have worked a little bit less each time they've done it - 2002, 2004, 2006. But it still has some effect. That's why we see Obama wearing a flag pin on his lapel today. So clearly, it's something they are worried about, and I think if you woke them up in the middle of the night, they'd say yes, a terrorist attack probably would help McCain.

OLBERMANN: Well, fortunately, we never had to test that in reality to see whether there would be adherence to the party already in power or some blaming to them. We haven't had to test that. Let's hope we never do.

But where do we go in terms of this story from here? Does McCain have to, whether he likes it or not, fire Charlie Black or face having this bell along with other bells around his neck all summer and all fall?

MILBANK: Well, he's going to wait and see. I imagine they are certainly going to hope that this becomes a 24-hour thing that blows over. Which it well could be, depending on what events happen in the coming days. But if it keeps being brought back to them, they'll have to take some action here.

The irony here is that Charlie Black is a very soft spoken, well-liked figure and this does seem rather out of character for him to sound off in this way.

OLBERMANN: Well, I can't imagine that anybody would unnecessarily

keep this story going for any particular reason. Dana Milbank of MSNBC and

the "Washington Post," we'll talk to you about this tomorrow -

MILBANK: And the next day.

OLBERMANN: That's right, and the day after that. Thank you, Dana.

MILBANK: Thanks.

OLBERMANN: For more, let's turn now to Richard Clarke, who is the National Security Council's counterterrorism chief under both President Bush and President Clinton, currently chairman of GoodHarborReport.com and author of the book, "Your Government Failed You: Breaking the Cycle of National Security Advisors." Good to see you in person again, sir.

RICHARD CLARKE, FMR. NSC COUNTERTERROR CHIEF: It's great to be here, Keith.

OLBERMANN: Did Charlie Black just erase any remaining line between counterterrorism and scaring people for political gain?

CLARKE: I think that line was erased in 2004. It's been erased in every election since 9/11. Now, what Charlie Black did is reveal their thinking, not that they wanted terrorist attack, but that they do plan to run by scaring us. They're using the same playbook they've been using for years because it works.

And if McCain is sincere in saying that he's shocked, that there's gambling going on in his casino, then he ought to part with Charlie Black. I mean, Charlie Black ought to be gone tomorrow morning so that we can say, once and for all, that this campaign is not going to be a campaign about fear and about saying that one guy is soft on terrorism and if you vote for him, there will be another terrorist attack; all the sorts of things that we've heard in the past.

OLBERMANN: Yes, just somebody once saying, this is not going to be a mixture of politics, presidential politics and the necessary counterterrorism because this is the darkest part of it. You can argue the politics forever and blame game forever, but - the darkest part of this, I think, and I'd like your opinion on it, is that we're necessarily faced with, if there are any legitimate warnings or any plots that come up between now and November, they now have to be seen through the prism of what Black has just said.

CLARKE: Well, that's right. And the fact that we now know from Tom

Ridge and others, that when there were threats released in 2004, well, they

were largely exaggerated and blown up. So, we're now in the situation

where the American people won't believe a warning, if there were a real one

but McCain can stop all of that. He can stop talking about Hamas has endorsed Obama; he can stop all of this sort of innuendoes and go to the issues-based campaign he said he was going to do.

And the way he does that is by tomorrow morning announcing the resignation of Charlie Black and saying that he wants to run on the issues and not as the "scare candidate," not as the scaremonger and not as the scarecrow.

OLBERMANN: Does he take one way or another because this does to some degree reflect that very - that intangible that he is running on, judgment in crisis relating to national security?

I mean, this was the comments that he made about Bhutto that Charlie Black made about Bhutto's assassination, that this helped him in New Hampshire, are pretty damn stupid because obviously, this suggests to terrorists whether they had any intention or not, that they can affect, materially affect American politics and get whoever they want, perhaps, elected. And all sorts of other matters and in addition to the point we were just making which is this reinjects this idea of - we will say something that could conceivably mean that the next terror alert is ignored or viewed utterly cynically.

What kind of judgment is it and is that part of the judgment process about somebody's judgment where you say, "Look, you have this man working for him, and clearly, he does not know when to keep his big mouth shut"?

CLARKE: Well, Charlie Black knows a lot about politics but he doesn't know much about terrorism. If he did, he would know that Osama bin Laden, Ayman al-Zawahiri, and all the al Qaeda leadership, watch U.S. politics very closely. We've even had cases where in interviews, bin Laden quoted opinion polls from European public opinion polls.

So, yes, they understand that they can manipulate politics as they tried to in the Spanish election with the attacks there. And to say, "Yes, you can manipulate our politics, come and do it," is an invitation that the McCain campaign shouldn't be anywhere near.

OLBERMANN: From what you're seeing regarding those who were advising McCain and McCain's own predilections in this, is there any indications or any space that would suggest, and obviously, what he does about Charlie Black is perhaps the biggest examination he's had on counterterror yet, but is there any indication that he is deviating to any degree from the Bush handling of this - which seems to be political opportunity first, photo opportunity second, protect the country third?

CLARKE: Well, not yet, and, in fact, quite the opposite. I mean, the remark that McCain made about how Hamas had endorsed Senator Obama as though Senator Obama wanted their endorsement. That said to me that they're going to run on this fear card. They're going to run on innuendo and whisper. They're, obviously, thinking they're going to benefit from the fact that some percentage of the American people think that Senator Barack Obama is a Muslim.

And, you know, they need to walk away from all of that and they have the opportunity now. Charlie Black's mistake, letting the veil drop, is an opportunity for Senator McCain to run a dignified campaign on the issues and walk away from the politics of fear.

OLBERMANN: Is there an opportunity in it for Obama not to exploit this mistake or exploit this issue or exploit counterterrorism but to say, "All right, here's how I actually differentiate myself from Mr. McCain's approach to the entire issue," or some way he can help in this matter, shake that thing that has been hung around the Democrats' necks for seven years that there is some softness on terror?

CLARKE: Yes, I think there's a way to have a dialogue in this election campaign about national security, about terrorism and about homeland security without invoking the fear card. And there are substantial differences in what the two candidates have said. McCain is a much more of a "let's use the military to deal with terrorism" guy and Obama is saying, "No, let's use all the instruments of national power."

OLBERMANN: A good time to perhaps for him to reemphasize that as they did in the statement to some degree.

Richard Clarke, former national counterterrorism advisor, author of most recently book, "Your Government Failed You," as I said, pleasure to see you in person, sir.

CLARKE: Glad to be here.

OLBERMANN: Take care.

There is actually a town called Unity, New Hampshire, and actually split 214 Democratic primary votes evenly for senators Clinton and Obama and that is where they will campaign together first.

In Best tonight: My gerbil crashed my car; and in Worst: "Drilling for oil in the Alaska Wildlife Refuge will be great," says the congresswoman, because with all the new pipelines, the caribou will have a place to hold their coffee klatches.

(COMMERCIAL BREAK)

OLBERMANN: Though Obama makes peace with Clinton in the town of Unity, but he may have trouble with Moveon.org about the law about FISA.

And he won't close the Enron loophole as people helped to open but John McCain suddenly has $300 million in taxpayer money to develop a perfect battery-operated car that would drastically reduce energy prices in only five, 10, or 20 years.

Plus, the caribou will love drilling in Alaska because the pipeline will be a good place for them to hold coffee klatches. This is actually said out loud by an elected member of the House of Representatives. He's in Worst Persons tonight.

(COMMERCIAL BREAK)

OLBERMANN: Where is the unity the Democrats have this year so long sought? It's about 12 miles east of Scottney (ph), Vermont, just down from Sunapee (ph), yes.

Our fourth story on the Countdown: Obama and Clinton's first joint appearance on Friday at Unity, New Hampshire, where in January's primary they each got 107 votes.

"New York Times" is reporting that Senator Obama is already starting a 50-state strategy by dispatching page staffers to every state in the union. Our NBC and MSNBC political director, Chuck Todd pointing out that the "outraise and outspend" technique already worked for Senator Obama in the primary because even though Senator Clinton raised $210 million, she still ended up losing and $22.5 million in debt.

No unity for Mr. Obama over FISA though. MoveOn.org asking its members to persuade him to go further that he's promised to work in the Senate, to remove the immunity clause from the bill, urging members to call Obama's office and remind him, quote, "Last year, after phone calls from MoveOn members and others, Obama went so far as to vow to, 'support a filibuster of any bill that includes retroactive immunity for telecommunications companies.' We need him to honor that promise."

Joining me now is the founder and publisher of DailyKos.com, Markos Moulitsas.

Good to talk to you again, sir.

MARKOS MOULITSAS, PUBLISHER, DAILYKOS.COM: Always, Keith. How are you doing?

OLBERMANN: How important is this effort to get Obama to filibuster or otherwise, you know, some rabbit out of some hat somewhere, FISA? If he doesn't, how much grassroots network support does he stand to lose if any?

MOULITSAS: Well, I don't think he's going to lose any support, I mean, let's be honest. I mean, it's either Obama or John McCain. So, we really don't have much of a choice, as far as a presidential election is concerned. I think what's at stake, though, is a lot of the intensity of support for Barack Obama. And he spent the last two years telling us how he's going to be the leader of the free world, not to mention the Democratic Party and this nation.

And, so, I think we're - there are people like us that are hoping to see some of that leadership in the next couple of days. He's also said, he also wants to be that person to put the hand on the Bible and promise to uphold and defend the Constitution of the United States of America and, again, he has a chance within the next couple days to show that in action.

I don't want to hear him talk about leadership. I don't want to hear him talk about defending the Constitution; I want to see him do it. And I think if he does, it will increase the intensity and level of support that he gets from base Democrats. If he doesn't, I think we may worry that he's just another one of these spineless Democrats who are more afraid of controversy and doing the right thing, than they are of actually doing the right thing.

OLBERMANN: But to the point of the Constitution, John Dean made a fascinating point on this news hour on Friday. He read this bill and he knows a little something about the Constitution, too. He says it's so sloppily written that nothing in there would rule out later criminal liabilities for the telecom companies.

Could that be, actually, what Obama is counting on, just sort of cede this civil action stuff which is basically in lieu of sending these people to jail and just concentrate on, you know, closing up whatever perceived weakness there is of the Democrats being soft on counterterror and, in fact, just hold a bigger punch back until after the election?

MOULITSAS: Well, if that's the strategy, he has said nothing to indicate that and this is not the sort of thing that I think you have to keep quiet and secretive. I mean, if that's his strategy, he can say, "This is a bill that's flawed," but, really at the end of the day he has a chance to stand for the Constitution and to show that he will protect it against forces that seek to undermine it and he will show that he has, like I said before, that he is a leader and will take the mantle of leadership on this issue and take control of the Democratic Party.

He's been working to sort of consolidate his power in the party. This is the perfect example, perfect chance for him to show that a Democratic Party, a Barack Obama Democratic Party is going to be one that stands for civil liberties and the Constitution.

OLBERMANN: Markos, from what you're seeing, on the subject of the campaign, the 50-state strategy, is it in use right now because they want to make McCain bleed money while defending the traditional Republican strongholds, the so-called "red states" or do they actually think they can make margins and gains in some or many of those states?

MOULITSAS: Well, the goal, obviously, in November, is to win the election and to win the election you have to win states. You have to win more electoral votes than the other guy. And, in the last two cycles, what we've seen - Al Gore and John Kerry - is that they basically put all the eggs into Ohio and Florida, and the other states, but really it was Ohio and Florida and that allowed the Republicans who also concentrate their resources on those two states. Ad both times, that bet did not pay off, the Republicans won.

So, now you have a situation where Obama's coming in and he's saying, "We're not going to repeat the same mistakes of the past, we're going to try something new. We're actually going to carry, we're going to campaign in all 50 states, we're going to carry the message nationally," and in given Republicans possible problems with the resources, this may force the Republicans to really stretch out their resources. I mean, if they have to spend money in Alaska, in Montana, South Dakota, then, they don't have that much money for Ohio and Florida.

OLBERMANN: Markos Moulitsas, publisher of the DailyKos, as always, sir, many thanks for your time.

MOULITSAS: Thank you.

OLBERMANN: How often do they hold one of these ugliest dog contests, weekly? That is a dog, right?

And what a headline - "The manager of a team comparing New York Mets fans to fertilizer" - too bad the "New York Post" just made it up.

Worst Persons is ahead on Countdown.

(COMMERCIAL BREAK)

OLBERMANN: Best Persons in a moment and you pulled what out of your backside?

First, 36 years ago today, June 23rd, 1970, Richard Nixon said it his chief of staff, Bob Haldeman, quote, "They should call the FBI in and say that we wish for the country, don't go any further into this case, period." That would end Nixon's presidency. The smoking gun conversation because the "they" Nixon referred to, was the CIA and this case was the Watergate break-in, and it was proof that six days after the crime, Nixon was already involved in a criminal cover up.

Let's play Oddball.

We begin with 2008's newly minted ugliest dog in the world. Fighting out of Largo, Florida, trained by the Teed family, this is Gus, a Chinese crested who is genetically hairless, lost a leg to cancer and lost an eye in a cat fight. Who's laughing now, Kitty, kitty, kitty?

Gus beat an entire field of mangy mutts in California on Saturday, taking his rightful place as the second most famous three-legged, one-eye, hairless celebrity to R2D2 from "Star Wars." For his efforts, Gus gets the check for 500 semolions (ph), gets a long nap and the never-ending respect of the staff of Oddball.

To the B&F discount beverage store in Deland, Florida, where this man is not interested in any discount beverages. He wants cash and lots of it. Yes, that is a man robbing a store with a palm frond. Give me all your money or I'll fan you. The perp ordered the clerk to fork over 50 dollars. Instead, he was shooed out of the store with a bar stool and arrested. Hope that was wicker. At first, the shopkeeper's son thought it was a joke, but, and this is a real quote, looking at the video, my father could have been hurt. Those tips are sharp. Well, sharper than the guy holding them is anyway.

(END VIDEO CLIP)

OLBERMANN: John McCain tries to avoid questions about the Enron loophole by proposing a 300 million dollar bounty for a perfect battery driven car, the bounty to be paid for by cutting 300 million dollars worth of pork from his first budget. Wait, McCain already has 300 million dollars worth of pork in his first budget?

And another huge loss to America's understanding of itself. George Carlin is dead at 71. Our last interview ahead.

First, time for Countdown's top three best persons in the world. Number three, best media misdirection, Cincinnati Reds slugger Ken Griffey Jr, on his last visit ever to Yankee Stadium, is asked, what is your favorite Yankee Stadium memory. His answer, leaving it. Everyone rushes out and writes of Griffey insulting Yankee Stadium. He told me, yesterday, nobody listened to the rest of my answer. I said I have left it 17, 18 times, leaving it, the home run hitter's term for hitting a home run somewhere. Yesterday, Griffey hit a home run at Yankee stadium, leaving it for the 19th time in his career.

Number two, best excuse, unnamed 17 year old female driver in Springdale, Utah. She veered off the road, slammed into a car stopped under the shoulder. It hit a third car, pinned a woman between them, hit a second person. Some broken legs, nothing worse. Her explanation, her pet had escaped its cage while she was driving and she was trying to catch it, her pet gerbil. The old gerbil excuse.

Could be worse, could be number one, best dumb criminal, Jeffrey Barrier charged at Cincinnati for allegedly using his cell phone camera to take pictures of a naked woman at the Aloha Tanning Salon in that city. When confronted by cops. Mr. Barrier denied he even had a cell phone. Then what they described as a second search discovered, oh, he had one all right. But it wasn't in his pocket. Quoting the report, he hid the cellular phone in the area of the anus. No truth to rumors that the discovery was made when a synthesized version of the hokey pokey began to emanate from Mr. Barrier's -

(COMMERCIAL BREAK)

OLBERMANN: After his proposal of a gas tax holiday to cut gas tax prices met with blistering criticism as a gimmick, John McCain today shifted away from gimmickry and on to cash prizes. In our third story tonight, for the first time to come up with an alternative to gas guzzlers, the new McCain jackpot is now 300 million dollars. That's 300 million dollars. Specifically, McCain today proposed that 300 million dollar bounty for inventing a new Flash Gordon car battery. Where will he ever get the money?

(BEGIN VIDEO CLIP)

MCCAIN: We can afford 233 million dollars on a bridge, we certainly could, in my view, spend one dollar per every man, woman and child in America to eliminate our needs. I could pay for it by canceling three pork barrel projects that are unnecessary and unwanted.

(END VIDEO CLIP)

OLBERMANN: And unspecified. McCain not explaining how there is any pork left to spend, since he has already said eliminating pork would pay for his previous spending and didn't say when this would alleviate gas prices either. But virtually as he spoke both a hedge fund manager and an oil company adviser told Congress today the U.S. could cut the price of crude oil and, therefore, gasoline, in half in about 30 days by eliminating legal loopholes that let investors speculator on oil prices.

The White House today down played the role of speculators, while the McCain camp claimed that he has taken the lead against speculation, a claim the Obama camp suggests is tenuous, given McCain economic guru Phil Gramm's role in creating those very loopholes. The McCain camp today releasing a letter from Gramm denying any role in writing the legislation, possibly not the best way to deny that it was, in fact, written by lobbyists.

At this point, let's bring in Chris Hayes, Washington editor of "The Nation Magazine." Chris, thanks for your time tonight.

CHRIS HAYES, "THE NATION": Thank you, Keith.

OLBERMANN: His off-shore drilling is not going to cut prices currently or in the near term, and if the invention occurred tonight of the wonder battery, that would still be, I don't know, 2018 maybe. His position on gas prices is, I have no idea what to do about gas prices?

HAYES: Yes, that's pretty much it. And, actually, to be fair, the fact of the matter is it's very unclear what the president of the United States, from either party or either candidate, can do about gas prices. Right now, the American people, people who live in exurbs particularly, who are very dependent on their cars, are bearing the brunt of decades of bad policies. So it's really unclear what the president could do.

What you don't want to do is use the proximate crisis of these spiking gas prices to smuggle in a lot of bad policy. So we have the gas tax holiday was the first idea and that would have been a really bad policy. That has been knocked down. And then last week, it was off-shore drilling, which is also a terrible idea. One economist said to me that it was like digging for change in your couch when you're six months behind on the mortgage.

The one thing you don't want to do in the face of a crisis, and that crisis is very real, is use it to sort of throw all sorts of bad policies at the wall. And that seems to be the road they've been going down.

OLBERMANN: If the president can't do anything directly about the price of gas, the way this is rippling throughout the economy, United Airlines today furloughed 1,400 employees and some of the 1,400 are on military leave, just to twist the knife a little further. Does McCain have any explanation for how he could address those ripples?

HAYES: No, one of the problems with his campaign right now is that it is very schizophrenic when it comes to the economy. He's trying to negotiate this tricky sort of slithering between the proverbial rock and the hard place. On one side, the rock is the fact that American people are very anxious about the economy and they have every reason to be. Between gas prices and roiling of financial markets, the subprime crisis, mortgages and foreclosures, et cetera. Then on the other side, he has a kind of conservative orthodoxy that he has had to embrace in the run up to this campaign in order to get this nomination. That conservative orthodoxy said, well, you can't do a whole heck of a lot.

What ends up happening is you have this strange schizophrenia. One day he is saying, I support cap and trade, for instance, to deal with global warming. The next day he says he doesn't believe in mandatory caps. Well, mandatory caps are the whole purpose of cap and trade. One day he's the budget hero. He's going to fight pork and spending. The next day, he has 300 million dollars for a prize. That might be good policy or might not be, and that could be said of a number of things he proposed along the way, but there's absolutely no coherence to what kind of vision they're laying out for how they're going to kind of move the economy forward.

OLBERMANN: Yes, the world opens anew every day for them on this subject. You and I have talked before about McCain and this Enron loophole. It became a law thanks to Phil Gramm, who is now McCain's chief economic adviser. It was lobbied for by Charlie Black, who is his chief strategist and is, as we already know, unfortunately, the guy who sees the political advantage of a terrorist attack in this country for his party. What happens to McCain on the big picture here if suddenly the voters or a lot of them connect the Gramm, Black, McCain four dollar gas dots?

HAYES: Well, it's trouble. And what we're seeing in the polls so far is that voters do trust Barack Obama on energy, the environment and the economy, far more than they trust John McCain. I think what you have here is a situation in which, look, people - economists themselves don't really understand why we've seen this spike immediately. People certainly don't. They know they're paying more, right? What you do know is that when you're electing a president, that president is going to bring with them certain voices they're going to listen to, and certain interests that will have their ear.

We've seen what eight years of an energy policy run by the energy companies has resulted in, and that has not been progress. So, that's the perception that they're going to have to battle.

OLBERMANN: Chris Hayes, Washington editor for "The Nation." As always, Chris, thank you for your time tonight.

HAYES: Thank you, Keith.

OLBERMANN: Countdown first told you about the McCain campaign's ties to the Enron loophole. That was last week. You can see that entire report, our special report, still on our website, Countdown.MSNBC.com.

Our farewell to the late George Carlin. His last interview here.

And the Minnesota Congresswoman who actually thinks oil pipelines would be good for Alaskan caribou because then they can hold coffee klatchs alongside the nice warm pipelines. Worst next on Countdown.

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OLBERMANN: Remembering George Carlin, his last interview here on Countdown. That's ahead, but first time for our number two story, our worst persons in the world.

Tonight, the bronze to sports writer Bart Hubbic (ph) and the "New York Post," who deliberately twisted New York Mets Manager Jerry Manuel's joke about fertilizer into an insult against Mets fans and a front-page cover insisting the manager had described the team's supporters as fertilizer. Manuel was asked about the home fans booing and said, I'm going to say this and I hope you don't take this wrong. I know you're going to run out of here with something crazy on this. It's very, very fertile ground for growth at Shea Stadium. It's fertile ground for a team's growth and development. Sometimes fertile ground has fertilizer. Fertilizer a good thing. It's a good thing. You get the greatest results. You get the most beautiful plants when you put it in that type of fertile soil. That's what we are the opportunity to do. Don't take that wrong, because I know what you're going to do with it.

Jerry Manuel never called New York Mets fans fertilizer, never came close to it. "The New York Post" simply made that part up.

The runner up, US Representative Michelle Balkman of Minnesota, explaining that drilling for oil in the Arctic National Wildlife Reserve in Alaska would be beneficial for the wildlife there because - because the warmth of the oil in the pipeline causes a, quote, enhancement of wildlife expansion, and would, quote, become a meeting ground and coffee klatch for caribou. Hilarious Jonah Goldberg and comedian Rush Limbaugh read off similar talking points last week. The caribou herd in the area though, where they are already doing the drilling, has reduced the area they migrate in by 78 to 90 percent. The caribou herd in the area where the new drilling is proposed migrates across a much larger area, so it would likely thin out quickly with much of its migration area cut in half by a fricking pipeline. The heat of the pipeline is good for them. It's a coffee klatch. For god sake, you people elected this woman to Congress.

But our winner, Monica Crowley, still pushing the Obama is a Muslim thing. Fortunately, she's not very good at it. Claiming on the radio that Obama's half brother, Malik, quote, went on the record to the "Jerusalem Post" of all places and said, oh, yes, Obama has a really solid Muslim background. As ABC's Jack Tapper pointed out, Malik Obama never ever talked to the "Jerusalem Post," on the record or off. He did do an interview with Israeli Army Radio. ABC has the tape online, but nowhere even in that interview does Obama's half brother say anything about a supposed Muslim background.

It was the "Jerusalem Post," not Malik Obama, which used the phrase. Monica, if you are going to try to scare people into believing this lie that Obama is a Muslim, please, try not to humiliate yourself by getting caught this easily. Monica Crowley, today's worst person in the world!

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OLBERMANN: George Carlin was that most rare of contributors to this nation; he succeeded within the establishment, then succeeded outside of it. Then took outsider cred with him, and operated from within the belly of the establishment for 40 years. Our number one story in the Countdown, George Carlin died last night in Santa Monica, aged 71, heart failure, just hours after checking himself into a hospital for chest pains. He had been on stage as recently as the weekend earlier in Las Vegas.

He started in the Air Force, then as a disk jockey, then as one of those young suit and tie comedians, making his debut on "the Tonight Show" so long ago, October 1960, that Jack Paar was still the host. As late as 1967, he was still in the mainstream, a regular on a summer replacement TV comedy series, alongside Richard Pryor, and also still in a suit and a tie.

Then came the great breakthrough, "The Seven Words You Can Never Say on Television," which eventually would be ruled on by the Supreme Court. George Carlin changed America with those seven words and he changed comedy, of course. Behind the scenes, almost always anonymously, he was a mentor to countless younger comics, a shepherd as they, like he, tried to kick every addiction in the calendar, and quietly, almost as if he didn't want anybody to know it, a lovely, lovely man.

He first dropped me a note with suggestions for the predecessor to this show in 1998, and he e-mailed observations to me here on the undertaking that I could use them on the air, but never give him credit. Finally, last October he stepped in. To say good-bye to George Carlin, I can think of no better way than to replay that interview in full.

The brief context, the news stories we discussed included the fact that Steven Colbert was still trying to run presidential primaries, Arlen Specter had appeared on stage at a comedy club, and the far right was overreacting to J.K. Rowlings' revelation that one of her Harry Potter characters, Dumbledore, was gay. George Carlin on October 23rd, 2007.

(BEGIN VIDEOTAPE)

OLBERMANN: Joining me now, as promised, a man who is no stranger to the absurdity in our society, and whose biting commentary is not just the stuff of comedy but of revelation. His recently released career retrospective, "George Carlin, All My Stuff," includes 12 HBO specials spanning three decades.

George Carlin, pleasure to have you here.

GEORGE CARLIN, COMEDIAN: Thank you. This is the best news show ever. I told that to one of your producers and I want you to know that. I've seem them all and it's just - especially the first 35 minutes. It's just unparalleled.

OLBERMANN: I've got bad news; between you and I, we've got six minutes to completely screw that into the ground. Dumbledore, Jerry Falwell, Tinky Winky; I'm missing something on why gay non-existent characters are so important.

CARLIN: Don't these professional Christians have something to do during the day? I mean, didn't Jesus leave instructions on how to plan your day? Something constructive? Didn't he kind of help people? Didn't he look out for the afflicted, to use half of A.J. Liebling's quote? Comfort the afflicted, and afflict the comfortable to complete it. It just seems that they get off on these tangents here.

And, of course, the homosexuality and the reading of science fiction, such as the Bible, and giving it the standard of truth I mean, they it would be cartoonish if it weren't dangerous to some people.

OLBERMANN: And we need people to establish theocracies and go to war and all the rest of that.

CARLIN: And instilling guilt and shame and fear in people.

OLBERMANN: There is a Republican poll out that says that Stephen Colbert is fifth among Democrats. They surveyed 1,000 people who, I don't know, like Republicans. Is there a period of time have we gotten there? Because Mencken predicted that eventually we would elect the dumbest guy in America. Are we going to someday elect a satirical president, a guy who really has no intention he's doing it as a sales tool for something else?

CARLIN: Well, we are working on that. We did elect something of that nature in 2000 and 2004, if you want to look at it from a long distance. Up close, it may not be that. I was around in 1960 when Professor Erwin Corey (ph) ran for president. I was around in 1968 when Pat Paulson ran for president. And I think Larry Flynt had a go at it there for a while.

You know, it why is he fifth among Democrats? Doesn't he play a Republican on television?

OLBERMANN: Apparently he comes in tenth or 11th down there with Tom Tancredo. He only has one percent of Republicans. He is, as Bob and Ray once posited, the best way to try to get elected, run for both the Democratic and Republican nominations. You have two chances.

CARLIN: He is just a wonderful comic relief and I hope he goes far, and I hope he can get a couple primary states under his belt.

OLBERMANN: He would really upset this thing. The reverse of Colbert

I want to play you this clip. It is Senator Arlen Specter and a story that he says his colleague's father used to tell.

(BEGIN VIDEO CLIP)

SEN. ARLEN SPECTER, PENNSYLVANIA: Mother and I have sex almost every night. We almost have sex on Monday. We almost have sex on Tuesday.

(END VIDEO CLIP)

OLBERMANN: As odd as it is to see a Republican senator, even a fairly liberal one, from Pennsylvania standing there at the Improv, is there something positive about this? Because if Nelson Rockefeller had made that joke 40 years ago, not only would he have been out of the presidential race, he would have had to resign as governor of New York. Anything that touchy; is it better that we are letting these guys get up and have fun?

CARLIN: I liked Rockefeller because he gave the finger to the Republican convention, the conservatives in 1964. And then he died in the saddle, which I thought was a nice thing for the Republic. Of course he had his screw you money put away a long time before. I think that is a great joke that Specter told. I was waiting for Phil Specter. I wasn't sure either Specter might have been OK with me.

OLBERMANN: Well, Phil is no longer involved with the government, not directly anyway. He is being pursued by the government. I mentioned Bob and Ray, those were my heroes when I was a kid. At the height of Watergate I got to interview them and I said, why don't you do because they had gone after McCarthy in a limited way, but a very effective way. I said, why didn't you do more political humor. And Ray said, how could we make that funnier.

Do you feel that way about President Bush?

CARLIN: Well, I use the sledge hammer. I don't do bother with the rapier on Bush. I don't really do a lot of political humor, but I have some glancing blows in the current show that I'm developing. And one of them is a reference to him as Governor Bush, and the fact that I will always think of him, no matter where they hang his portrait, nor matter where they put his statue that is what he is. He is Governor Bush, because that's the last elected office he held legally in this country.

So I like moving in and really hurting them.

OLBERMANN: Yes.

CARLIN: I don't like this, let's be cute and let's be clever. I like smashing them. That's the only way to take care of them.

OLBERMANN: The other day speaking of smashing things, I quoted in this newscast, first time in the newscast, the seven words you can't say on television, the story of them and the fact that everybody forgets the first part of that story is the guy who had his phone tapped and would answer the phone, bleep Hoover. We are back there. How did we get back to the same position that we were when you made that joke originally in the 1970s?

CARLIN: You are talking about wire tapping?

OLBERMANN: Yes.

CARLIN: I don't know that we ever really left. I don't really I don't think that Frank Church committee really did any good. I don't think all of these reforms I think power does what it wants. Power does what it wants. And now they are just more naked about it. Now they just put it right out front and say this is what we are doing to you, folks. This country is finished. It has been sliding down hill a long time. And everybody has got a cell phone that makes pancakes so they don't want to rock the boat. They don't want to make any trouble.

People have been bought off by gizmos and toys in this country. No one questions things more. Seriously, that's what I love about your show. You bring the thing right to them. And that is the only way to do it.

OLBERMANN: As you know, if you got the platform and you're not doing something with it, you might as well have a trained monkey out here. The one and only George Carlin, the retrospective is called "George Carlin, All My Stuff" on DVD. Go buy it. A pleasure having you here, sir.

CARLIN: Thank you, sir.

(END VIDEOTAPE)

OLBERMANN: Last Wednesday, the Kennedy Center in Washington announced that this November it will present its Mark Twain prize for lifetime achievement in humor to George Carlin. That will now sadly be a posthumous event. That's Countdown for this the 1,881st day since the declaration of mission accomplished in Iraq. For Al Sleet, I'm Keith Olbermann, good night and good luck.

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