'Countdown with Keith Olbermann' for Wednesday, July 2
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Video via MSNBC: Oddball

Guests: Howard Fineman, Rosa Brooks, E.J. Dionne, Lawrence Korb, Christian Finnegan

RACHEL MADDOW, INTERIM HOST (voice over): Which of these stories will you be talking about tomorrow?

Moving toward the center, Barack Obama's tactics draw criticism from the left. But will his moderate approach give him an edge in November?

A day of headaches for John McCain.

(BEGIN VIDEO CLIP)

ROBIN ROBERTS, TV HOST: You have admitted that you're cannot exactly an expert when it comes to the economy and many have said that -

SEN. JOHN MCCAIN, (R) PRESUMPTIVE PRES. NOMINEE: I have not. I have not, actually, I have not.

(END VIDEO CLIP)

MADDOW: OK, view the tape.

(BEGIN VIDEO CLIP)

MCCAIN: I am not an expert on Wall Street. I am not an expert on some of this stuff.

(END VIDEO CLIP)

MADDOW: That and new allegations about McCain's temper, a shakeup with his campaign staff, perhaps because his idea of a southern strategy is one that takes him to South America. How many electoral votes there?

And war on terror shocker: The mission in Iraq gets even more convoluted. A U-turn in strategy as we now have to spy on the Iraqi Army we created and trained.

(BEGIN VIDEO CLIP)

MIKE MULLEN, CHAIRMAN OF THE JOINT CHIEFS: There's no easy solution and there will be no quick fix.

(END VIDEO CLIP)

MADDOW: The chairman of the joint chiefs not talking about Iraq, he means there's no quick fix in Afghanistan, as that front turns more deadly for our troops than Iraq.

And: Can Obama credit his success to the series "24"? Star and show commander in chief Dennis Haysbert seems to think so. Does Hillary have Geena Davis to thank for her campaign falling short?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: You are surely mistaken.

(END VIDEO CLIP)

MADDOW: All that and more: Now on Countdown.

(on camera): Good evening. I'm Rachel Maddow in for Keith Olbermann. This is Wednesday, July 2nd, 125 days until the 2008 presidential election.

In outlining his plan to boost national service, today, Senator Barack Obama was no doubt aiming for John F. Kennedy's "ask not what your country can do for you, ask what you can do for your country." He was perhaps reaching for Franklin Delano Roosevelt's "I pledge you, I pledge myself to a new deal for the American people."

But, instead, in our fifth story on the Countdown: In a week of campaigning on expanding faith-based federal programs and the size of the military, Obama's political message today may sound to his left-wing base not like JFK or FDR, but more like the compassionate conservatism of George W. Bush. For a candidate running on change, defining the alternative to the Bush years, what gives?

Another day, another battleground state, another apparent move towards the right by the presumptive Democratic nominee, Obama told his audience in Colorado Springs today that he would make public service of all kinds, at home and abroad, a central part of his presidency if elected this fall.

High school students would be asked to perform 50 hours of community service a year, college students 100 hours; Senator Obama would also expand the size and scope of both the Peace Corps and AmeriCorps. The price tag for all of it - $3.5 billion, that would be paid in part, with savings from ending the war in Iraq.

Even as Obama pledges to bring troops home from Iraq, he's not eyeing a decrease on the size of the military. Keep in mind that right now we spend roughly what the entire rest of the world spends, combined on defense. And Obama wants a major increase in the size of our military.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA, (D) PRESUMPTIVE PRES. NOMINEE: But we need to ease the burden on our troops while meeting the challenge of the 21st century. And that's why I will call on a new generation of Americans to join our military and complete the effort to increase our ground forces by 65,000 soldiers and 27,000 marines.

(APPLAUSE)

OBAMA: A call to service must be backed by a sacred trust with anyone who puts on the uniform of the United States. So, a young person joining our military must know that we will only send them into harm's way when we absolutely must.

(END VIDEO CLIP)

MADDOW: Joining us now, our own Howard Fineman, senior Washington correspondent for "Newsweek" magazine.

Hi, Howard.

HOWARD FINEMAN, MSNBC POLITICAL ANALYST: Hi, Rachel.

MADDOW: Politics 101, Howard, says a candidate moves to the center for the general election. But when that candidate is Barack Obama, and he's won the nomination by challenging and changing common wisdom, is it necessarily the right strategy for him to move essentially toward McCain, might being less different make him less electable?

FINEMAN: Well, Rachel, I'm out here in Aspen, Colorado, where, by

the way, you have a lot of fans -

MADDOW: Oh, thank you.

FINEMAN: And I'm at something called the Aspen Institute Ideas Conference. There are a lot of very interesting, important, powerful people here in politics. A fair number of Obama fans, some of whom I've been talking to today and they are concerned about it. One of them is somebody you probably know, Arianna Huffington, and her point, as others have made here, is it's not so much left or right, although it might be that, too, as it is whether Obama is risking damaging his brand and that brand is about authenticity in being a different kind of politician.

So, when he decided not to do the public financing, when he decided to support the FISA bill, when he decided to take a more positive attitude towards NAFTA, it wasn't any one of those things necessarily, it's the idea that suddenly he was becoming a traditional politician, a traditional maneuverer. And a traditional maneuverer is precisely what he's been running against so far in this campaign.

MADDOW: It's also true that that means the left-wing critique or progressive critique of Obama just jives directly (ph) with the McCain critique of Obama which could be dangerous when it's coming from both sides. Roger Simon on Politico.com wrote today that there is a difference between running as a candidate for president and running as the leader of a movement.

Do you think that Obama is essentially avoiding confrontation now because he sees this task as not so much inspiring people any more, but reassuring them?

FINEMAN: Well, sure, Rachel. I think that's - I think Roger is exactly right, because I've always felt that Obama is the big issue in this campaign, from the very beginning. It's been all about Obama from the beginning. Now, he's going to be the Democratic nominee. Now, he's speaking to a much wider audience, not just the Democrats, but to all voters. And he is seeking to reassure them.

He's seeking to say, "Look, this is who I am and what I am is reassuring. I wear the flag pin now," he's saying. "Look at this ad that I did that shows my Kansas roots. It shows the white and other side of my family that you didn't know about. Listen to me talk about faith in the public square. Listen to me talk about the importance of the military and even increasing troop strength."

These are measures that he's taking and messages that he's sending out that are all designed to calm and reassure and convince independents and even Republicans, who, his strategists think he has a chance to reach this year.

MADDOW: Even if we understand why he's doing it, there's still the question of why he's doing it right now. Besides the Wes Clark ruffle (ph), which I think may yet work out to Obama's advantage in the end, I think this candidate hasn't taken a lot of hits recently. He's not getting a tough time from John McCain right now. So, why is he making this shift now? Where is the pressure that he's responding to right now?

FINEMAN: Well, I agree with you. It isn't pressure right now, although the polls, most of the polls are pretty close - the latest poll shown with Obama with statistically insignificant lead. But what he wants to do is batten down the hatches, prepare for the storms ahead, Rachel. You know, every afternoon here, it rains like clock work, you know in this campaign in September and October, the heavy artillery is going to come out.

Obama wants to raise the money now. He wants to lure and draw in and convince all those Hillary Clinton supporters to give money to him. Having not taken public financing, he really wants to build up a huge war chest for his campaign in the fall to defend against the attacks that will come. That's what he's doing right now.

He's working on the politics now, so that later on, after having introduced himself to the whole country in a positive light, he can then go on the attack. You said rule 101 of politics - rule 102 of politics is that you have to build up your own positive image before you go on the attack against somebody else. That's what he's doing now with the rest of the electorate, so he can then attack McCain in the fall.

MADDOW: Howard Fineman of MSNBC and "Newsweek," enjoy Aspen, thanks for joining us.

FINEMAN: Thank you, Rachel. Take care.

MADDOW: Senator McCain, meanwhile, is on a visit to Cartagena, Columbia, where he is denying that he physically roughed up an associate of Nicaraguan president back in 1987. Yes, the allegation doesn't come from just anyone; it comes from one of his fellow Republicans in the Senate -

Thad Cochran. You remember Thad.

Back in January the Mississippi senator said of McCain, who he's known for three decades, and I quote, "The thought of his being president sends a cold chill down my spine. He is erratic. He is hotheaded. He loses his temper and he worries me," end quote.

Well, in a new interview with a Mississippi newspaper, Senator Cochran is worrying everyone with the story of him witnessing a confrontation between McCain and a Sandinista rebel during a diplomatic mission to Nicaragua in 1987.

(BEGIN AUDIO CLIP)

SEN. THAD COCHRAN, (R) MISSISSIPPI: And I looked down there and John had reached over and grabbed this guy by the shirt collar and had snatched him, just snatched up like he was throwing him up out of the chair to tell him what he had thought about him, or you know, whatever I don't know what he was doing telling him, but I thought, "Good grief, everybody here has got guns," and we were there, and we were there on a diplomatic mission.

And I don't know what had happened to provoke John but he had all of a sudden got mad at the guy for something he had said and he just reached over there and snatched him.

(END AUDIO CLIP)

MADDOW: Senator Cochran apparently telling us that story as an example of how much his colleague has changed. Senator Cochran says McCain is now levelheaded. He's matured into, quote, "the best possible candidate for president." So much for the cold chill up his spine.

Despite that Cochran's assertion that that was then and this is now, Senator McCain today is saying this story isn't true simply because it's old.

(BEGIN VIDEO CLIP)

MCCAIN: Twenty-one years ago, right, I think that information -

UNIDENTIFIED MALE REPORTER: Yes, can you tell us what happened?

MCCAIN: It's simply not true. I must say I did not admire the Sandinistas very much. It was never anything of that nature and, so, it just didn't happen.

(END VIDEO CLIP)

MADDOW: Lots to talk about with E.J. Dionne, a "Washington Post" columnist and a senior fellow at the Brookings Institution.

Hi, E.J.

E.J. DIONNE, WASHINGTON POST: Hi. Good to be with you. I won't lose my temper, I promise.

MADDOW: Grab me by shirt and haul me out of my chair.

DIONNE: I can't reach.

MADDOW: So, the day before Senator McCain goes to Colombia, Senator Cochran drops this bombshell of this Sandinista dustup story. Cochran does this out of the goodness of his heart, I mean, with friends like this in is the Senate, does Senator McCain need to get a dog as they say in Washington so he could have a friend?

DIONNE: Well, you know, actually, this is a plot to rally the conservative base because I think they rather like the idea of McCain grabbing a communist by the shirt. But seriously, I think that, as you pointed out, Cochran and McCain have never really liked each other. They had trouble and they had feuded on spending. Cochran said all those things about the chill in his spine when he endorsed Romney in January.

I think this is helpful to Obama because Obama, given the kind of campaign he promised to run, you know, no personal attacks, I don't think he really wants to put the issue of McCain's temper in play himself. And so, it's helpful to have Cochran do it.

The question is: will this lead to a lot of other stories that put that issue in the paper and force McCain to answer or not? I think it's a practical matter for these temper issues, if I can call it that, to have a real effect on this campaign. You're going to have to see a live example of it during this campaign.

And I think McCain is going to try to take Cochran's advice or his judgment and say, "No, he's now got this under control." But if he were to lose his cool during the campaign, then we'd revisit this story and lots of others from the past.

MADDOW: Well, funny you should mention, David Wright of ABC News reports today, I'm sure you saw this morning. He said that on the plane on the way to Colombia, McCain, and I'm quoting here, "became visibly angry when I asked him to explain how his Vietnam experience prepared him for the presidency."

I mean, with all this manufactured outrage about whether or not McCain's service in Vietnam should be part of the conversation in this election, how about the issue of his temper? McCain's hometown newspaper ran an editorial in 2000, warning the country about McCain having a volcanic temper. McCain himself in his memoir said his temper is a matter of personal concern to him.

The question, I guess, remains, maybe we have to see it on tape, but should McCain's temper be a matter of political concern to us and will there come a point when Obama himself will raise it?

DIONNE: I don't think Obama will raise it himself unless you get some kind of episode that makes it so clearly an issue that he wouldn't feel he's engaging in a kind of personal attack. I can imagine in the debate prep, the Obama people will be looking for ways to say things that might provoke McCain.

But the temperament of a president has always been an issue. I mean, a president, as we know, can send us to war, we have nuclear weapons. So, temperament itself is a legitimate issue. But, McCain is going to have either - investigative reporters are going to have to find really good examples of it, or McCain is going to have to put it right out there for people to see.

MADDOW: E.J., there was also a personnel shift at the top of the McCain campaign today. A veteran of President Bush's '04 reelection effort, Steve Schmidt was put in charge of day-to-day McCain operations. The campaign is trying to spin it as not a shakeup, but it really feels like a shakeup. Do you think they're trying to reassure supporters that may be worried about how the campaign is going?

DIONNE: You know, I can put on a button that would say, "I'm not E.J. Dionne," but I'd still be me. And I think that this is clearly a shakeup. And I think that the truth of the matter is, as my colleague Chris Cillizza wrote this afternoon, that the problem may not be with any of the problems being pushed up or pushed down, it's that McCain himself has never been comfortable having someone clearly in-charge of his campaign. It's never been a crisp operation in McCain campaign.

But I think this is response to a lot of criticism of his campaign in Washington from fellow Republicans that envy green background, or whatever color green that was, behind McCain that night when he gave a speech against Obama's victory speech of the last day of the primaries, ever since then, there has been a lot of criticism about how this campaign is going.

And, also the fact that McCain seems to be putting Colombia in play, Mexico in play, what's that about? And so, I think, it's natural that they are trying to shake things up a bit.

MADDOW: It's the real southern strategy, yes.

E.J. Dionne of the "Washington Post," thanks for joining us tonight.

DIONNE: Good to be with you.

MADDOW: John McCain continues to deny he has ever downplayed his economic know-how, is he familiar with the Google? We'll do the whole helpful reminder thing again.

And: Did you hear about Senator Obama denying a kid the fist bump? The story is not true. We will show you the video. And irony alert in the war on terror: The interrogation techniques that were never designed to find the truth. And, wait until you hear who we are spying on in Iraq.

(COMMERCIAL BREAK)

MADDOW: Today's daily distortion on the campaign trail at twofer. How Senator John McCain writes history on his own understated of the economy; and some of the media get the Obama fist bump story completely wrong. Should the TV show "24" get the credit for paving the way for Obama's historic campaign?

And, we thought this one is true. Lawyers rejected for jobs at the Justice Department. Anyone think they might, I don't know, sue?

(COMMERCIAL BREAK)

MADDOW: What did John McCain know about the economy and when did he know it?

Our number four story tonight: As record numbers of Americans face foreclosure, paying $4 a gallon to drive to their bankruptcy hearings, Senator McCain today denied ever saying he's not an expert on the economy - - something he has denied and been corrected on before.

Here with his latest attempt to rewrite history that he, himself, wrote.

(BEGIN VIDEO CLIP, ABC)

ROBERTS: You have admitted that you're not exactly an expert when

it comes to the economy and many have said that -

MCCAIN: I have not. I have not, actually, I have not. I said that I am stronger on national security issues because of all the time I spent in the military and others. I'm very strong on the economy. I understand it. I have a lot more experience than my opponent.

(END VIDEO CLIP)

MADDOW: It's not a new question or a new answer. Tim Russert called him on it successfully in January.

(BEGIN VIDEO CLIP, MEET THE PRESS/ JAN. 27, 2008)

TIM RUSSERT, HOST: Here's a question I asked you and your response. Let's watch.

(BEGIN VIDEO CLIP)

Senator McCain, you have said repeatedly, quote, "I know a lot less about economics than I do about military and foreign policy issues. I still need to be educated." Is it a problem for your campaign that the economy is now the most important issue, one that by your own acknowledgment, you are not well versed on?

MCCAIN: Actually, I don't know where you got that quote from. I'm very well versed in economics.

(END VIDEO CLIP)

MCCAIN: Now I know where you got the quote from.

RUSSERT: I will show you where I got the quote from. I got it from John McCain. And here it is: "McCain is refreshingly blunt when he tells me, quote, 'I'm going to be honest, I know a lot less about economics than I do about military and foreign policy issues. I still need to be educated.'" "Wall Street Journal," November 26th, 2005. You repeated it to the "Boston Globe" in December of '07. You said it.

MCCAIN: OK.

(END VIDEO CLIP)

MADDOW: In addition to "The Journal" and "The Globe," there is, of course, tape of McCain misstating the core of the problem of the mortgage crisis. The fact that lenders no longer have the mortgages they made, and then he admits to, yes, a lack of expertise on the subject.

(BEGIN VIDEO CLIP)

MCCAIN: We've got to provide more incentive for borrower and lender to work it out so that these people are, so millions of people around this country are not deprived of the one of the fundamental goals of all Americans and that is the ability to own our own home. Now, I am not an expert on Wall Street. I am not an expert on some of this stuff.

(END VIDEO CLIP)

MADDOW: McCain has said he would rely on the advice of former Fed chair, Alan Greenspan, despite the fact that Greenspan dismissed warnings about the looming mortgage crisis. And on more than one occasion, publicly and privately, McCain has deferred questions about the economy to advisors like, former Senator Phil Gramm, despite the fact that Gramm helped cause the crisis by deregulating the banks.

With us tonight on this is "L.A. Times" columnist, Rosa Brooks.

Thanks for joining us, Rosa.

ROSA BROOKS, L.A. TIMES: It's a pleasure to be here, Rachel.

MADDOW: Simple question: why keep denying it when the whole world got the Google and the YouTube to prove him wrong on this?

BROOKS: Well, there are three possible explanations.

Possibility number one, he's got an arrogance problem and he thinks people are too dumb to look this stuff up.

Possibility number two, actually, I should say, these are overlapping possibilities. It could be all of them. He's got an integrity problem and he just flip-flops and says whatever is convenient at any given moment.

Possibility number three, and this possible is even worse, he's got a cognitive problem, he just can't even remember what he said.

MADDOW: Wow. Well, the thing that is weird politically about this, is that it's not just him alone, it's his whole campaign. Even McCain's own advisors are on record saying, "Yes, he said exactly what you thought he said." Then they roll out the excuses. And the excuses so far are, "You took it out of context or he was joking, or he's joke has turned (ph) to self-deprecating humor."

How messed up it is it, politically, at this stage of McCain's campaign, that not only he, but his big thinkers and adviser, can't come up with a single, coherent narrative to put this issue to bed?

BROOKS: They are doing their best to save him from himself. And, you know, I take my hat to them, but it's kind of a hard job. You know, I am not one of those people who thinks that the sign of a good politician is somebody who never changes their mind. I don't think any of us need politicians or want politicians who are incapable of changing their mind when they get new evidence.

But what really drives me nuts of all this stuff, you know, in some ways, his advisers are saying the only possible thing they can say if, you know, if he's changed his mind on anything, that's OK, but then come to us and say, "Look, here's why I thought this way then, here's why I changed my mind." He's not doing that, he's just denying that it didn't happen. You know, that's not particularly persuasive and it suggests that his campaign is amiss and his policies are amiss.

MADDOW: And, of course, there's the great double standard about the '04 presidential campaign where John Kerry's policy changes was the biggest issue in the world.

BROOKS: Right. Wind surfing.

MADDOW: Right. That became the narrative of the campaign for the media and for everybody because the Bush campaign defined it that way.

BROOKS: Yes, absolutely.

MADDOW: But it's not just changing your mind or changing your position on something, though. This is saying, this is making misstatements, this is lying. And McCain has admitted to lying about his opinion of the Confederate flag to win South Carolina in 2000. Now, there's this big idea (ph), I didn't say it lie about whether he understands economics.

How many things do you have to stack up before we get to the second of your third options, that he has an integrity issue, a "can you believe him" problem to contend with?

BROOKS: I think he's courting that problem right now. I mean, your "double talk express" line is a good one, and, unfortunately, he's made himself vulnerable to that charge. You know, again, it's not that hard to say, "Yes, I had one position then, I have a totally different position now. Here is why, you know, here's the evidence that made me reexamine my old assumptions, here's what changed in the outside world that made me decide that a new solution to this problem was appropriate, different from the one I used to believe in."

He's not doing that. And it does come across as an integrity problem. And, I think, voters are beginning to sense that. He was sitting and watching the footage of McCain in Tim Russert, he's sitting there and looking extremely uncomfortable when confronted with the footage of his own previous statements.

MADDOW: More substantively, beyond how he's campaigning and the integrity issues raised here, is the bigger issue here - not just his lack of expertise or his denial about that, but really his plans on the economy. I mean, the flip on the tax cuts, having Phil Gramm as an adviser, this trillionaire corporate tax cut deficit disaster thing, that's the bigger issue sort of looming over this whole ruffle (ph), right?

BROOKS: You know, the irony is that John McCain was right about his degree of economic understanding before he was wrong about it. You know, the reality is, he doesn't know what he's talking about and his economic policies show it. They're disastrous.

We're in the middle of, you know, extremely serious recession. Wall Street just had its worst June since 1930. Boy, that's not a good thing.

And John McCain is still saying things, like a lot of these is just psychological. He's still proposing a series of tax cuts that even the "Wall Street Journal" usually on his side of the fence is saying, this would, this would be disastrous and explode the budget deficit and would require cutting federal spending by about 1/3. You know, it doesn't make any sense at all.

MADDOW: Rosa Brooks, columnist for the "Los Angeles Times." Thank you for joining us.

BROOKS: Thanks, Rachel.

MADDOW: And if the economy were fine and the war were over and the Constitution was safe and snug as a bug in a rug, then maybe, only maybe, mind you then, our next story would have deserved a single seconds of national media attention.

You may have seen criticism of Barack Obama for refusing a school boy's fist bump while campaigning in Ohio yesterday, the implied narrative here, of course, is that if he did his terrorist fist jab on camera, everyone would know he was a terrorist fist-jabber. That's the story that went out yesterday, repeated coast to coast, as if it even mattered, even if it were true. Despite the fact that it was not true, the boy wanted an autograph in indelible ink on his hand.

(BEGIN VIDEO CLIP)

OBAMA: If I start that, mom may not be happy when she comes home.

She's like (ph), "what's the dirt on your hand?"

See you. I'll see you guys later.

(END VIDEO CLIP)

MADDOW: Obama denies fist bump to young boy story, debunked. Case closed.

Still ahead of us: Bushed. Shocking details of just where our new interrogation techniques came from and what those techniques were originally designed to do. Here's a hint: it wasn't to stop a ticking time bomb.

And, this is what it looks like when you combine the Fourth of July with an election year. But can this homeowner pass our sarcastic patriotism test?

(COMMERCIAL BREAK)

MADDOW: It was on this date in the year 1776 that resolution for independence was passed in the Continental Congress. Twelve colonies voted aye. New York would sign up later. The future second president, and hot mini series subject, John Adams said of this date, "the second day of July, 1776, will be the most memorable epic in the history of America. It ought to be solemnized with pomp and parade, with shows, games, sports, guns, bells, bonfires and illuminations from one end of this continent to the other from this time forward, for ever more."

Missed it by two days. We, of course, celebrate not the July second event Adams was so excited about, but rather the adoption of the Declaration of Independence two days later on July 4th. Once again, John Adams looks like a boob. Let's play Oddball.

(BEGIN VIDEO CLIP)

MADDOW: We begin in East Lake, California, where we find the summer home of Stephen Colbert. Actually, this is America enthusiast Steve Phifer's (ph) house. Each year, a week before the Fourth of July, Phifer drags out hundreds of American flags and displays them all over his southern California property. This marks the 15th year Phifer has been at this. He says his neighbors love the display. And if you can find him camouflaged in this sound bite, you'll hear Phifer explain just what America means to him.

UNIDENTIFIED MALE: It's not real windy right now, but when the wind's blowing and the flags are just flapping in the breeze, it just gets me right here.

MADDOW: Hate to rain on your parade, Mr. Phifer, but I don't see an American flag lapel pin on that shirt of yours.

To the old zoo in Sakai (ph) City, Japan, where the monkeys are so fat they don't even have the energy to fling their own poop. These monkeys are so fat people thought there were two hippo exhibits. I'm sorry, I kid the fat monkeys. It is a real problem. These are Reeces Monkeys. Some in the exhibit weigh three times what a normal Reeces Monkey weighs. Zoo keepers say patrons are to blame for over-feeding the primates. After years of falling for the big bones excuse, the zoo has put the monkeys on a diet. Their calorie intake has been slashed by 60 percent. And if that doesn't work, two words for you, tae bo, monkey tae bo. Be afraid.

(END VIDEO CLIP)

MADDOW: "24" is sometimes credited with keeping Americans hyped about the terror threat, but can the TV thriller take credit for Barack Obama's presidential success? The fictional black president from "24" land says, sure.

The real war on terror, no less absurd; the U.S. resorts to spying on the Iraqi army. You heard correctly. We're now spying on the very Iraqi army we trained. Tell me again why we're there in the first place.

But first, the headlines breaking in the administration's 50 running scandals - here it comes - Bushed. Number three, privatizing your money-gate. On everything from your health care to fighting terrorists, the Bush administration says private companies do it better and cheaper than, well, than the Bush administration. But the "Washington Post" reports that every year since 2001, more than 300 employees of private companies have filed claims saying their companies defrauded the government. The Bush Justice Department has only pursued about 100 cases a year, to the tune of about 13 billion recovered tax dollars. The current backlog of cases not being pursued is more than 900.

Number two, only Bush could go to China-gate. We needed torture to get life-saving intelligence, right? We needed confessions and intel and if we had to break a few eggs to get that omelet, so be it. The "New York Times" reports that trainers at Guantanamo based an interrogation lesson there on a chart of coercive techniques, a chart that dated to 1957. That chart was taken from an article called, "Communist Attempts to Elicit False Confessions from Air Force Prisoners of War." This was a study of how the Chinese tortured propaganda fodder out of Americans in the Korean War. Prolonged standing, exposure to cold, all that enhanced interrogation stuff, we called it torture when the Chinese did it to our guys in Korea and we know it produces false confessions. Why are we using these techniques?

Number one, have you got a good lawyer-gate. The Justice Department's inspector general found last week that Justice officials made hiring decisions based on politics and ideology, which is a violation of the law, not to mention a violation of justice. In doing so, the Justice Department illegally rejected the job applications of some of the country's best lawyers, possibly hundreds. Surprise, the jilted lawyers are suing, not only because their rejections violated civil service laws, but because their privacy was violated when the DOJ researched their political views.

As if that's not enough, to defend itself, the Justice Department now has to rely on the legal savvy, the brilliant legal minds of the people it hired instead, like the genius alumni of Jerry Falwell's, quote, university, end quote.

(COMMERCIAL BREAK)

MADDOW: It's no surprise that Iraq is going the way of Afghanistan.

That is, we have lost control and, to a certain extent, lost the points. Like a nanny-cam trained on the untrusted baby-sitter, the military is now using our spy satellites to conduct surveillance on our own allied army, the very force we helped create and to this day alongside whom our troops fight. In our third story on the Countdown, an Iraqi army displaying an unprecedented level of autonomy and aggression, the Taliban reasserting itself in Afghanistan, causing the highest number of coalition troop deaths since the start of the invasion, and an American public less spooked by terrorism and more fed up with war.

Why shouldn't we be? Especially after this morning's foreboding assessment by Chairman of the Joint Chiefs of Staff Admiral Mike Mullen.

(BEGIN VIDEO CLIP)

ADM. MIKE MULLEN, CHAIRMAN, JOINT CHIEFS OF STAFF: The Taliban and their supporters have, without question, grown more effective and more aggressive in recent weeks, and as the casualty figures clearly demonstrate. We're right in the middle of the fighting season, if you will, and we've seen the Taliban revert to the kind of violence that is - that is tied to IEDs, suicide bombings, those kind of things, and I think we can expect more of that. And I think it's going to be a pretty tough fight for a while.

(END VIDEO CLIP)

MADDOW: The situation deteriorating and no solution in sight, as Iraq continues to siphon resources.

(BEGIN VIDEO CLIP)

MULLEN: I've made no secret of my desire to fly more forces - US forces to Afghanistan as soon as I can. Nor have I been shy about saying that those forces will not be available until or unless the situation in Iraq permits us to do so.

(END VIDEO CLIP)

MADDOW: We've apparently had it. According to a new CNN poll, 68 percent of Americans are totally over the Iraq war. And the percentage of Americans afraid of an imminent attack on U.S. soil has dropped to its lowest level since 9/11.

Let's bring in Larry Korb, senior fellow at the Center for American Progress, a former assistant secretary of defense in the Reagan administration. Dr. Korb, Larry, thanks very much for joining us.

LAWRENCE KORB, CENTER FOR AMERICAN PROGRESS: Nice to be with you, Rachel.

MADDOW: We're reconciling an American public that is done with the war in Iraq, with news that a war we thought was done, Afghanistan, isn't and never was. U.S. troops coming back from Afghanistan sometimes call that place "forgotastan." Do you that Afghanistan is getting unforgotten in our politics now?

KORB: I hope not. The clip you played from Admiral Mullen shows we need more troops in Afghanistan, but Mullen himself is one of the people to blame. A couple months ago, when he was asked about this, he said, well, in Iraq we do what we must. In Afghanistan we do what we can. No, those are where the attacks of 9/11 came from. That is where al Qaeda is reconstituting itself. There was no al Qaeda in Iraq before we went there. There was none of the other reasons that the president gave turned out to be true.

We've got ourselves mired down in the wrong place right now. The Iraqi people want us out. The American people want us out. The government we created, we can't trust, so why do we continue to give that priority?

MADDOW: Based on what the administration told us, both Iraq and Afghanistan were supposed wars about avenging 9/11. As you say, that is still unfinished business. The Rand Corporation, just this month, says that al Qaeda is as strong as it was on 9/11, bin Laden and Zawahiri are still out there. Do we still get be afraid politics on terrorism in this context? Do you still think we should?

KORB: I think we need to be concerned that al Qaeda has reconstituted itself on the Pakistan/Afghanistan boarder, and they will be able then to carry out attacks on us or our friends and allies around the world. Had we continued in Afghanistan, not diverted ourselves to Iraq, we wouldn't have this problem. We took our eye off the ball. We thought Afghanistan was won. We took out a lot of our troops and our attention. And what happened is the key front in the war on terror has become - become stronger while we dealt with something that was not a threat. We have got our priorities exactly backwards.

MADDOW: Meanwhile, with over 140,000 troops still in Iraq, this spying on the Iraqi army is apparently because our military was caught off guard by some recent Iraqi military ops. And now we need to keep tabs on them. Some are actually saying that this is a good sign. I think it means our Iraq policies, in the largest sense, make no sense. We're now spying on the very army that we created, trained and armed. What is your take on this?

KORB: Basically, the Iraqis don't want us there. And what has happened is they don't like the fact that we're telling them what to do. They have their own agenda, which is different from ours. We want a peaceful, stable, democratic Iraq. What the Iraqi - the people running Iraq want is they want an Iraq that is dominated by one group, the Shias. They want an Iraq that has a close relationship with Iran, which we do not want to have.

So, what's happening is they're basically using us for their own purposes. When they went into Basra, this operation we didn't know about, we had to bail them out. Had we not done that, what would have happened is you would have had a lot more damage and a lot more carnage in that country.

MADDOW: Larry Korb, formerly of the Reagan Administration, now with Brookings Institution, thanks for your time and insight tonight.

KORB: Nice to be with you.

MADDOW: The chips are not totally down in the McCain campaign. He's been endorsed by Ponch everybody. I know it's from the '70s, but, hey, Ponch.

Speaking of Ponch - no, I can't say that. I'm sorry. Angelina Jolie is still in tact. We know about the state of Angelina Jolie's pregnancy, because there was a live news conference from France to update the world on the subject. Seriously.

(COMMERCIAL BREAK)

MADDOW: Glory, glory hallelujah. The latest offspring of Angelina Jolie and Brad Pitt may be here in a few weeks. That's the official word from Ms. Jolie's doctor, in our number two story on the Countdown, keeping tabs. The actress is resting comfortably at the Lenval (ph) hospital in Nice, France. She arrived by helicopter and occupies a suite of rooms protected by body guards. Ms. Jolie's doctor, Michelle Susman (ph), says that his patient is being, well, patient as she awaits the birth of her twins; quoting, what she needs now is simple surveillance by monitoring. Music to the paparazzi's ears, and the NSA's.

But the good doctor was cagey about whether the birth of Jolie's new babies in the near future is expected to be premature, saying only it will take place in the coming weeks. And he sure did like Jolie's star turn as the voice of Lola in "Shark Tales." Sorry, I just made up that last part. Sorry.

And just when you thought the concept of remaking "Beverly Hills 90210" couldn't get any sicker, hello Shannon Doherty. The terrifying - I mean still promising actress is being courted to reprise her role as Brenda Walsh in the updated series. But there are hitches like money, and Doherty wants to know what her storyline will be before agreeing to the gig. These demands, even though Doherty was fired from the original show in 1994, after she got in a fist fight with fellow actress Jenni Garth (ph). Ms. Garth and Tori Spelling are already set to PRESS: their roles. So get out the boxing gloves or maybe just the remote. Click.

Did President Palmer on the small screen actually pave the way for President Obama in real life? If that's the case, what does that say about Gina Davis as Commander in Chief Ellen. Your day in political punch lines next on Countdown.

(COMMERCIAL BREAK)

MADDOW: Would a presidential candidate rather have the endorsement of a police officer or a president? What about the endorsement of an actor who played a police officer, versus an actor who played a president? And wait, what if the fictional commander in chief thinks that his portrayal may have paved the way for the real-life candidate? In our number one story on the Countdown, it's Dennis "I'm not a president but I played one on TV" Hayesbert versus Eric "Ponch" Estrada.

Mr. Hayesbert has contributed 2,300 bucks to Obama's campaign. As for his role on "24" a few years ago, quote, "if anything, my portrayal of President David Palmer, I think, may have helped open the eyes of the American people, and I mean the American people from across the board, from the poorest to the richest, every color and creed, every religious base, to prove the possibility there could be an African-American president, a female president, any type of president that puts the people first," end quote.

Really? Impressive. But shouldn't Gina Davis be given some credit for portraying a female president on the ABC show "Commander in Chief?" Oh, yes, that was canceled, never mind. Sorry, Senator Clinton. Meanwhile, Mr. Estrada, who played Frank Poncherello (ph), better known as Ponch on "Chips," you know, back in the '70s, cruising the California freeways on his motor bike, he has endorsed Senator John McCain, calling him, quote, a man's man. You can trust me not to make up a quote like that ever. He actually said it; McCain's a man's man.

Let's bring in comedian Christian Finnegan, also a regular contributor to VH-1's "Best Week Ever." Good evening, Christian.

CHRISTIAN FINNEGAN, COMEDIAN: Hi, Rachel.

MADDOW: All right, Dennis Hayesbert seems like a nice enough guy, certainly a good actor, but he also said that people still come up to him and ask him to run for president all because of his portrayal of a president on TV. So he really does believe he's helped Obama?

FINNEGAN: Yes, I'm sure that's going to be Obama's new campaign slogan, vote for me; it will be just like the show "24." I like the show and all, but in the real world, I don't think people would be too crazy about the Palmer administration. Let's see, members of the cabinet are traitors. Your wife is brutally murdered. Oh yes, a nuclear bomb detonated on American soil. Not exactly morning in America. Although I bet his approval rating would still be higher than Bush.

MADDOW: Then, logically, Gina Davis hurt Senator Clinton and Jimmy Smith's brief stint as president on "West Wing" didn't do any favors for Governor Bill Richardson. Right?

FINNEGAN: The whole thing is just so tacky. You don't see Carl Reiner (ph) and Mel Brooks taking credit for John McCain, just because they happened to write "The 2000-Year-Old Man."

MADDOW: Then there is Ponch, Eric Estrada, who is, by the way, now an actual deputy sheriff in Bedford County, Virginia. Mr. Estrada attended Senator McCain's event at the National Sheriff's Association yesterday. Estrada plans to put on a big fund-raise for McCain, and he said, he's a good man; he's a man's man, and I want to support him. Is that better or worse than Chuck Norris endorsing former Governor Mike Huckabee?

FINNEGAN: Well, its always good to get a celebrity endorsement of this magnitude. But personally I'll wait and see where the rest of the "Surreal Life" cast comes out before I make my decision. Where does Bridget Nielsen (ph) stand on off shore drilling? What's Vern Troyer's position on FISA? Make no mistake, think is a coup for the McCain campaign. I happen to have met Officer Ponch live in person once, and boy, one gaze, one prolonged gaze into those pearly veneers, and I nearly became a man's man, if you get my drift.

MADDOW: Senator McCain may want to rethink sending out one of his surrogates, former New York Mayor Rudy Giuliani. On CNN yesterday, Giuliani actually said, quote, I thought I was best qualified to be president, but I thought John McCain was number two. I don't suppose that's going to help Giuliani's chances of being chosen for the number two slot, will it?

FINNEGAN: Boy, as someone who lived in New York through the entire Giuliani administration, this seems so not like him. Where's the grace and humanity that has defined the man over the years? Honestly, I don't think he had a chance for VP anyway. I think Romney's got it locked up. If the primary campaign made one thing clear, it's that in John McCain's eyes, Mitt Romney is number two.

MADDOW: Christian, briefly, at the risk of piling on Senator McCain, what is going on with his wife's spending habits, charging 500,000 on one American Express Card and a quarter million dollars on another, all in one month? Is this pain at the pump for her private jet? What's going on here?

FINNEGAN: Rachel, you don't just go out and buy 400 fluorescent pink retina burning lady suits off the rack. You have to get that stuff made custom. She's on the campaign trail. You pick up some Chotskis. You ever been to the Mitchell Corn Palace? You try not dropping 100 grand.

MADDOW: Comedian Christian Finnegan, a contributor to VH-1's "Best Week Ever," thanks.

That's Countdown for this 1,890th day since the declaration of mission accomplished in Iraq. I'm Rachel Maddow. Thanks for watching.

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