'Countdown with Keith Olbermann' for Tuesday, July 29
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Video via MSNBC: Oddball, Worst Persons

Guest: Howard Fineman, John Harwood, Eugene Robinson Dana Milbank, Maria Milito

KEITH OLBERMANN, HOST (voice over): Which of these stories will you be talking about tomorrow? Citizen Kaine. The buzz grows deafening about the Virginia governor as V.P., but who's the "P"?

Today, Obama meets with Federal Reserves Chair Bernanke and Treasury Secretary Paulson. While the official president is mailing it in now, somebody has to act like the president.

John McCain's flip-flop flip on taxes. First, he would never raise them. Sunday -

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R-AZ) PRESIDENTIAL CANDIDATE: Nothing's off the table. I don't want tax increases.

(END VIDEO CLIP)

OLBERMANN: Today -

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE KID: If you were a president, will you raise our taxes?

(LAUGHTER)

(APPLAUSE)

MCCAIN: No.

(LAUGHTER)

(END VIDEO CLIP)

OLBERMANN: Read my lips, "No new taxes." Also, new taxes are not off the table.

The genius behind the bridge to nowhere could wind up being sentenced to somewhere. Senator Stevens of Alaska indicted on seven counts of failure to disclose to authorities.

"Bill-O, The Clown" loses it again. When Scott McClellan said the White House in which he served sent talking points to "fixed news" commentators, Billy, who thinks he is "fixed news" but not a commentator, protests and too much.

(BEGIN AUDIO CLIP)

BILL O'REILLY, FOX NEWS HOST: My professional reputation is not going to be smirched by you or MSNBC or CNN or anybody else. I'm an honest purveyor of news and information.

(END AUDIO CLIP)

OLBERMANN: Bill-O also thinks he's a moderate. Notice he said nothing about his producers getting White House talking points or other FOX hosts - Hannity.

Worst: The New York cop claims the bicycling protester deliberately rode into him and knocked him down. Keeping tabs, Ryan Seacrest bitten by a shark.

(BEGIN AUDIO CLIP)

RYAN SEACREST, CELEBRITY HOST: The shark bit me. And I thought, ooh.

(END AUDIO CLIP)

OLBERMANN: Evidently, the shark only wanted a small snack.

And the horse race that suddenly turned into a Rupert Murdoch impression.

(BEGIN VIDEO CLIP)

ANNOUNCER: They're coming down to the finish and it's arrr! Arrr.

Arrr.

(END VIDEO CLIP)

OLBERMANN: All that and more, matey: Now on Countdown.

(BEGIN AUDIO CLIP)

UNIDENTIFIED MALE: Arrr.

(END AUDIO CLIP)

OLBERMANN (on camera): Good evening. This is Tuesday, July 29th, 98 days until the 2008 presidential election.

Never mind Senator McCain's flop back today to no tax increase barely 48 hour after he insisted that tax increases were not off the table.

In our fifth story tonight: The senator's latest motion leading to a story perhaps more remarkable still, a McCain campaign spokesman actually claiming - McCain does not speak for the McCain campaign.

Details presently. First, of the other candidate's meetings with the people actually running the economy right now, Treasury Secretary Henry Paulson - the presumptive Democratic nominee, Mr. Obama is talking with Mr. Paulson by telephone this morning; also meeting in person with the Fed chairman, Ben Bernanke at the Federal Reserve.

In a statement, an Obama spokesman is calling the meeting at the Fed informative. A campaign adviser telling the "AP" that the Illinois Democrat wanted the Fed chairman to give him an update on where the economy is and where it's going. Did south come into the discussion?

With Mr. Paulson, Senator Obama reminding the treasury secretary that he supported the housing legislation passed by Congress last week and still awaiting the president's signature.

Speculation about the Bernanke, Paulson and Obama conversations is high. Speculation that Virginia Governor Tim Kaine might be Senator Obama's vice presidential pick and soon even higher.

The "Washington Post" is reporting that Governor Kaine has told close associates that he has had very serious conversations with Senator Obama about joining the ticket. Obama is spending 2 ½ hours with the head of his search team in Washington this afternoon. When asked outside a Virginia radio station if he wanted the V.P. spot, Governor Kaine not exactly sticking to no comment.

(BEGIN VIDEO CLIP)

GOV. TIM KAINE, (D) VIRGINIA: I haven't sought it, I'm not running for it, I'm not asking for it. I never asked anything of the campaign. I didn't endorse him to get anything. I endorsed him to help him.

And again, the area where I can, I think, I can be most helpful is in Virginia, which, in an odd way, you know, Virginia, which has not been competitive in the past, Republican candidates didn't need to come and Democratic candidates were like why bother - right now Virginia is definitely in play, and I'm going to be helpful there in whatever capacity and I look forward to it.

(END VIDEO CLIP)

OLBERMANN: Time now to welcome our own Howard Fineman, senior Washington correspondent for "Newsweek" magazine.

Good to see you, sir.

HOWARD FINEMAN, MSNBC POLITICAL ANALYST: Hi, Keith.

OLBERMANN: Governor Kaine, why is this V.P. chatter, unlike all other V.P. chatter or is, indeed, is it?

FINEMAN: Well, I think the Kaine chatter is serious because they're good friends - Obama and Kaine. Kaine was one of the first people who endorsed when Obama ventured out to run for president. Obama shortly after he was elected to the Senate came out to Virginia to campaign for Kaine, who was a long shot at that time.

They share a lot of backgrounds - small town Kansas roots, Harvard Law School, both their wives are graduates of Princeton. They both care about race relations.

Kaine's wife, Anne Holton, is the daughter of Linwood Holton who is a crusading Republican moderate governor of Virginia who stood against the rising Nixon brand of Republicanism and insisted on supporting busing in Richmond, Virginia, to the point of sending his own kids to public school.

OLBERMANN: Wow.

FINEMAN: He's a revered figure and somebody very much known and revered by the Obamas - husband and wife.

OLBERMANN: So, this generation, Governor Kaine is also - represents several constituencies Obama can't touch, and just for measure according to the piece that I read that you wrote today - an excellent piece on this - speaks Spanish, just to throw in a little extra.

FINEMAN: Yes, he covers all the bases. He covers the south with Virginia. He's Catholic, which is important. And no candidate has won an election in recent decades without winning the Catholic vote.

He does speak Spanish. And he's a conservative on some issues. He's personally opposed to the death penalty but has allowed the death penalty be at used in Virginia.

OLBERMANN: Right.

FINEMAN: For a Democrat, he's pretty strong on gun rights. So, he covers a tremendous number of bases. And most important, he's not from Washington. He's from the Virginia suburbs, but he's a governor, not a senator. You've got a situation where we've got two senators running against each other.

OLBERMANN: Exactly. But can the sources close to and that long answer there be enough to knock him off the short list? Presuming he's on it. I thought that the Obama - rule number one about a V.P. club was - we do not talk about V.P. club.

FINEMAN: Yes, I thought, as you look at that clip, there was a man campaigning for the job, very obviously. I talked to one of the three short-listers. I can't say which one.

OLBERMANN: OK.

FINEMAN: But the three are Senator Evan Bayh, Senator Joe Biden, and Governor Kaine. And that is the list. According to these people, that is the list. Interestingly, Hillary Clinton isn't on it.

I think all the vetting has been done. My sense from talking to this one person, the vetting is over with. So, Obama can choose any time he wants because the lawyers are basically finished with their work.

OLBERMANN: So, when would they do it?

FINEMAN: Well, the conventional wisdom is that you wait until right before the convention, you juice up the convention. The convention is going to be juiced up enough as it is.

Obama is the kind of guy who hides in plain sight. He does things very methodically and openly. I could see them, just for fun, trying to do it before the Olympics begin on these and other networks, and try to compete a little bit with the networks to get some attention.

OLBERMANN: Oh, and then all your ads in Olympics, at least the second half of them, could have your vice president's name on them.

FINEMAN: Exactly. You steal a march (ph) on McCain.

OLBERMANN: I see. All right. Last question has nothing to do with this. That's your short list - short list according to Howard Fineman -

Biden, Bayh, and Governor Kaine.

All right. The meetings that he had today by phone and in person with Paulson and Bernanke, on top of the world tour where he looked like a world leader, is there a perception that the cost-benefit analysis works out to their advantage there, that whatever - I'm worried about the presumptuous level of that and how that's being perceived?

FINEMAN: Well, he's not rocketing ahead in the polls.

OLBERMANN: Right.

FINEMAN: And I think that may be one reason. Rather than talking to Hank Paulson on the phone, who after all is the custodian of the Bush economic policy, the Democrats I talked to today say that Obama should have been picketing the Treasury Department.

What Obama needs to do if he's going to win this thing is to be like the Clintons empathetic and specific with the needs of the voters. He has not yet done that. He looks presidential but hasn't sounded like - looked like he's listening.

OLBERMANN: Howard Fineman of MSNBC and "Newsweek," with us here tonight. Always a pleasure to see you, sir.

FINEMAN: Thank you, Keith.

OLBERMANN: Take care.

Now back to Senator McCain and the taxes. And today, he ignored the advice of W.C. Fields - never work with animals or children - at a Nevada town hall this morning, deflecting criticism that he had flip-flopped on his pledge not to raise taxes. Cue - the senator cueing the kid.

(BEGIN VIDEO CLIP)

MCCAIN: I'd like to ask one of our oldest members here, too, attendees.

UNIDENTIFIED FEMALE KID: If you were a president, will you raise our taxes?

(LAUGHTER)

(APPLAUSE)

MCCAIN: No.

(LAUGHTER)

(END VIDEO CLIP)

OLBERMANN: Oddly enough, this same kid is in the "Daisy" commercial.

But when Senator McCain spoke with reporters on his campaign bus earlier this month on the 9th of this month, he did not rule out a tax increase for funding Social Security. Over the weekend, in an interview with George Stephanopoulos, he returned to the idea of a payroll tax increase to buttress Social Security.

(BEGIN VIDEO CLIP)

MCCAIN: I will say that everything has to be on the table if we're going to reach a bipartisan agreement. I've been in bipartisan negotiations before. I know how you reach a conclusion. We all have to sit down together with everything on the table.

GEORGE STEPHANOPOULOS, ABC NEWS CORRESPONDENT: So that means payroll tax increases are on the table as well?

MCCAIN: There is nothing that's off the table. I have my positions and I'll articulate them. But nothing's off the table.

(END VIDEO CLIP)

OLBERMANN: Moving back even further, there haven't been a reversal from the stance, Senator McCain outlined in an interview with the "National Review" magazine in March of last year. The question: "If you can get the Democrats to agree or at least to come to the table on entitlements or on tax simplification, are those circumstances under which you'd be willing to accept a tax increase?"

Senator McCain: "No; no."

Question: "No circumstances?"

Senator McCain: "No. None. None."

Let's turn now to CNBC's chief Washington correspondent, John Harwood, also, of course, political writer of the "New York Times."

Good evening, John.

JOHN HARWOOD, CNBC: Hey, Keith.

OLBERMANN: He won't raise taxes but everything including the payroll tax increase is on the table for Social Security reform. Is this a flip-flop or is this a flip-flop flip?

HARWOOD: I'd prefer the simple flip-flop. Look, I think, just like for Barack Obama, the calendar has turned. He's not in the phase of the primary campaign when he was trying to impress conservatives in the base of his party. He's got to now try to make a different argument against Barack Obama - somebody who's also trying to reach across the aisle, appeal to independents, and that's what he's doing here.

What is problematic is those quotes that play just indicated.

OLBERMANN: Senator McCain's spokesman, Tucker Bounds told FOX News this morning that the senator had not really been speaking for the campaign when he told Stephanopoulos that a tax increase was on the table.

I'm reluctant to close this competition out for this race, but that's the damnedest thing I've heard yet. How is that possible that the candidate is not speaking for his own campaign?

HARWOOD: Actually, Keith, it's not possible. I don't know what Tucker was talking about. It is, however, possible that the campaign does not speak for John McCain. This is the challenge of John McCain for all the people working for him.

This is a free-wheeling candidate, more so than almost anybody we've seen run for national office. He's going to do what he wants to do. They all know it and they've got to brace themselves because sometimes, they get these unexpected moments. I'm sure his campaign was not anticipating that response to George Stephanopoulos.

OLBERMANN: But if that is actually going to be a response at any point from a campaign, does that not have catastrophe written all over it? Or is there some - am I not being sufficiently suspicious of this, is this just going to buttress the idea that he's the so-called "maverick" on everything?

HARWOOD: Well, he's trying to do the "straight talk express" and he's trying to preserve a little nuance as you saw in that answer to George. What he's saying is, "My position is I'm against a tax increase, but as a bipartisan, somebody who is willing to engage in conversation with the other side, I'm not willing to take it off the table."

The problem, of course, is that quote you showed from the "National Review" showed he was quite definitive at taking it off the table when he was running for the Republican nomination.

OLBERMANN: And, obviously, today, he did it again with the little girl in the audience (INAUDIBLE).

HARWOOD: Well, he was being nice to a little girl, I think.

OLBERMANN: Oh, you think that's the explanation for that? He just gave her the microphone and she just asked (ph) that question very nicely (ph).

HARWOOD: You couldn't disappoint a face like that.

OLBERMANN: There was a Washington anti-tax group, the Club for Growth, which hammered McCain after that interview with George Stephanopoulos, called his statement that "nothing is off the table" shocking because of his adamancy in opposing raising taxes under any circumstances.

You suggest here that maybe he didn't want to make the little girl cry. I'm suggesting here maybe he heard that quote from the Club for Growth. Which is more likely?

HARWOOD: Oh, yes, he heard it, Keith. No question about it.

Look, John McCain's got a lot - so many problems in this campaign. He's got a conservative base that doesn't trust him. Hence, they rush out a statement like that. Much stronger than you've heard from liberals about Barack Obama when he shifted, say, on terror surveillance with that FISA bill or even in campaign finance reform.

John McCain is distrusted by his base. He's trying to reach out to the middle. Barack Obama has the advantage going into the general election of a base that's solidly behind him and giving him a lot of running room to do what he wants.

OLBERMANN: John Harwood of CNBC and the "New York Times" - thanks much, John.

HARWOOD: My pleasure.

OLBERMANN: The candidate does not speak for the campaign. It could prove a problem later on.

The first sitting senator in 15 years to be indicted. The first video of Worst Person as a cop swears a cyclist rode into him while the video shows the opposite.

And the Best: The best part of the Monica Goodling story. They have now released the exact wording of her LexisNexis searches on would-be Justice Department employees, just one line from the whole thing - applicants named with Iran-Contra or Clinton or spotted owl or Florida recount or sex.

(COMMERCIAL BREAK)

OLBERMANN: Monica Goodling's bizarre, almost unearthly database search to make sure would-be Justice Department employees somehow were not connected to the Clintons or the Florida recount or sex or worst of all, the spotted owl. We will offer our own database search to be used not by Ms. Goodling but rather on her. This will include the words diploma-mill and boxtops.

Later in Worst: Charles Krauthammer going for that Obama-Hitler comparison, doesn't realize he's also making a Reagan-Hitler comparison. And the candidate doesn't speak for the campaign.

You're watching Countdown on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: Until today, Senator Ted Stevens of Alaska was best known for the "bridge to nowhere," a multi-billion dollar pork barrel project so pointless it was later abandoned by local officials.

And on our fourth story on the Countdown: The longest serving Republican senator and now becomes the first sitting U.S. senator in 15 years to be indicted, ushering in a corruption scandal for this election cycle which includes the senator's own re-election bid.

Today, the Justice Department indicted Stevens on seven counts of failure to disclose. Between 1999 and 2007, he allegedly did not disclose continuing receipts of more than $250,000 in gifts and services. You got to write them down.

These were from VECO Corporation, an oil services contractor, and from its then CEO Bill Allen - including improvements to Senator Stevens' vacation home in Girdwood, Alaska, like a new first floor, a wrap around deck, plumbing and electrical work. A gas grill, furniture and tool. And he was also accused of failing to report a new Land Rover for use by his son, which Mr. Allen allegedly gave to him in a trade for a 1964 Ford Mustang.

The indictment says VECO employees and Mr. Allen were soliciting Stevens for, quote, "multiple official actions knowing that Stevens could and did use his official position and his office on behalf of VECO during the same period."

Stevens responding today a statement, reading in part, quote, "I have never knowingly submitted a false disclosure form required by law as a U.S. senator. I am innocent of these charges and intend to prove that."

The 84-year-old senator will be allowed to turn himself in. But his political challenge may be far less gentle as he faces a GOP primary in August, but the popular mayor of Anchorage, Mark Begich awaiting him as the likely Democratic challenger in November.

Let's call on the national political reporter of the "Washington Post," MSNBC political analyst, Dana Milbank, whose book, "Homo Politicus," is out in paperback today. And also, we assume in the days to come.

Good evening, Dana.

DANA MILBANK, THE WASHINGTON POST: Good evening, Keith.

OLBERMANN: All right. Those, we read through the charges here including that they gave Senator Stevens plumbing, but there's obviously quid pro quos plenty implied here, but what is the story behind this?

MILBANK: Gosh, Keith, this has been going on as long as, and with as many plot twists as "Northern Exposure." Four years ago, they started to look into this oil and gas company up there in Alaska in terms of favors that were done for it by state and federal lawmakers.

And now, four years later, there have been seven convictions and first, Senator Stevens' son was involved, then last year, his own home was raided and that sort of started the drumbeat up until this year. And it has come at the most inopportune moment for Senator Stevens and his party.

OLBERMANN: We'll get to the national implications in a moment, but does Stevens now run for re-election or can somebody else run at this point? Do the Democrats see a possible pickup in Alaska now?

MILBANK: Well, they put out a very defined statement today, indicating that he does still intend to run. That's something of a nightmare for the Republican Party. At any rate, it may be too late for him to pull his name off the ballot for the primary which is in August. This will leave him in a delicate spot if he doesn't withdraw and then if he does withdraw, it's not clear how they replace him. So, it's not looking terribly good for that seat right now.

OLBERMANN: If they, Dana, seeded the senator the way they do of a tennis tournament like Wimbledon, where would Stevens be these days? Has he been sort of on the sidelines since that investigation, since that raid last year of his house?

MILBANK: Yes, I think, he's sipping a cup of Pims (ph) and dipping his strawberry in the clotted cream right now. But he wasn't in a terribly strong position in the polls even before this. It was looking like an uphill climb for him even though he is the longest serving Republican in Senate. Now that this indictment has come into place, it really does seem like this may be a bridge to nowhere for him.

OLBERMANN: Of course. Is this of any value to the Democrats nationally and we've heard from a thousand different GOP operatives that the GOP was still convinced it lost the midterms two years ago over the issue and individual instances of corruption. Well, here's some more GOP corruption.

MILBANK: Well, it may not be harmful necessarily to John McCain, who is a very public and longstanding critic of Stevens. Where it's going to hurt them more is in the House and Senate races where this will be tarnished, particularly if Stevens remains on the ballot as he, at this moment appears determined to do

OLBERMANN: Dana Milbank of the MSNBC and the "Washington Post." The book is out today in paperback. Congratulations, it's always a signal day.

MILBANK: Thanks a lot, Keith.

OLBERMANN: Take care.

Simply put, it is the biggest horse race since the day hoofs parted one. The first leg of the fabled "Countdown" quadruple crown won by a horse with the name that sounds like an - an Australian pirate.

And Worst Persons: So the cyclist ran into the cop? Seriously?

But first, the headlines breaking in the administration's 50 running scandals - Bushed.

Number three: Blood for oil-gate. Remember when the people who said the Iraq war was design to benefit the oil industry. The Republicans responded by calling those people "tin foil hat" conspiracy theorists. Then the Republicans started saying we have to stay in Iraq because otherwise al Qaeda might get the oil and raise the price of gas.

Well, the pretext is officially at an end, Richard Perle, one of the architects of the invasion of Iraq is, according to the Murdoch's "Street Journal," trying to invest in an oil drilling deal with the Kurds of Iraq even though the Bush administration is, on record, opposing any oil deals with the Kurds until the Iraq government straightens out which group owns what oil fields in Iraq.

Number two: Blackwater-gather. As if the firm of mercenaries murdering Iraqi civilians, and avoiding prosecution there or here were not bad enough, the inspector general of the Small Business Administration is reporting that a Blackwater affiliate was somehow erroneously designated as a small business. It got more than $100 million in government contracts, which by law could go only to small businesses, those with fewer than 1,500 employees.

But, our winner: Goodling-gate. The story yesterday that the Justice Department had found that Alberto Gonzales' protege, Monica "The Church Lady" Goodling had illegally screened would-be immigration judges and line prosecutors for political and ideological affiliations.

This just keeps getting better and better. Goodling liked to ask candidates which government figure besides President Bush, of course, was their favorite. One candidate reads a case history buried deep in the Justice Department report, reported that after he stated he admired Secretary of State Condoleezza Rice, Goodling frowned and commented, "But she's pro choice."

The full report even includes the information search on job candidates which Goodling would have entered into her by a computer or entered into a computer for her for the LexisNexis database. If you're unfamiliar with LexisNexis, it's kind of an industrial strength Google.

Look at this, first name of candidate and last name of candidate with Bush, or Gore, or Republican, or Democrat, or charge, or accuse, or criticize, or blame, or defend, or Iran-Contra, or Clinton, or spotted owl, or Florida recount, or sex, or controversy, or racism, or fraud, or investigate, or bankrupt, or layoff, or downsize, or PNTR, or NAFTA, or outsource, or indict, or Enron, or Kerry, or Iraq, or WMD, or arrest, or intox, or fired, or sex, or race, or intox, or slur, or arrest, or fired, or controversy, or abortion, or gay, or homosexual, or gun or firearm!

Wait. Spotted owl, or Florida recount, or sex? Oh, God, you just made me think of Katherine Harris. Notice sex and arrest are in there twice. Well, it's thorough.

This necessitates that we create our own LexisNexis search for Monica Goodling, which would look like this: Monica and Goodling with nuts, or crazy, or psycho, or gossip, or rumor, or made-up-crap, or diploma-mill, or found-law-degree-on-street or boxtops, or Wossamotta U, or theocracy, or speaking in tongues or thinks ghosts living under her bed, or perjurer, or privacy violate, or secret forbidden crush on Wonder Woman.

Seriously though, if only they'd had Monica Goodling use her monomaniacal vetting on the Iraq war, we'd never have gone in. Vietnam, or quagmire, or Curveball, or land war in Asia.

(COMMERCIAL BREAK)

OLBERMANN: Bests in a moment. And sorry, ladies, those were really cops not cops dressed as strippers.

First, on this date in - we'll let him choose to tell who he wants which year. Theodore C. Olbermann was born in New York City. He's done a lot of things in his life. But if you've been in a mall, the odds are about 50/50 you've been in a store for which he was the architect. But most impressively, he was one of only two people in world history to have somehow survived the ordeal of raising me.

So, happy birthday, dad.

Let's play Oddball.

OLBERMANN: We begin in beautiful Saratoga, New York, with the second race of the day, and a horse that sounds very familiar to us here at Countdown. Rupert, is that you?

UNIDENTIFIED MALE: Just In behind them, Blazing Buddha third, now on the far outside here comes Arr! Top of the stretch coming into the final furlong now. In between horses, Crafty C.J. with the narrow lead. Arr! continues up on the outside. It's Good To Be King and Blazing Buddha, then farther back Little Wise Guy. They're coming down to the finish. And it's Arr!, Arr!, Arr!.

OLBERMANN: Arr! paid 320, 280 and 180.

To St. Louis, where Jesus Christ on a Cheeto, it's Jesus Christ on a Cheeto. At least, that's what Kelly Ramie (ph) thought when she pulled this cheesy snack from the bag. Telling local media, quote, I looked at that and I thought, oh, my, it looks like Jesus on the cross. It was just like wow." The family has decided to keep the savory savior, not putting it on eBay. They've even named it Cheese-us. If you don't like that, call them, not me.

(END VIDEO CLIP)

Hey, kids. Guess what time it is? It's almost time for another edition of Bill O, the clown show, with today's extra special fun time guest, Scott McClellan. And Ryan Seacrest bitten by a shark. No, no, not Simon Cowell, an actual shark. These stories, but first time for Countdown's top three best persons in the world.

Number three, best creativity, the police department in Manila in the Philippines. Their latest bid to save gas and money, run their patrol cars on a combination of diesel gasoline and used cooking oil from McDonald's. I'll have a Big Mac and 17 gallons of French fry grease, please.

Number two, best cliche springing to life, police in a German town of Simmern called to a building where neighbors had complained of noise at a quarter to one in the morning. Two male officers walked in to find a woman celebrating loudly her 30th birthday. She and her friends erupted into a round of applause because they assumed the cops were male strippers dressed as cops.

Number one, best dumb criminal, Spencer Taylor of Three Rivers, Michigan, arrested for investigation of larceny and malicious destruction of property. He's accused of trying to steal all the posters and some other items related to the Batman movie, "The Dark Knight" out of the lobby of the local movie theater there in Three Rivers. How on Earth they should have suspected Taylor is unclear, especially given his disguise, purple suit, green wig, face paint to match the Heath Ledger getup as the Joker in "The Dark Knight." Great disguise there, Wyl-E Coyote.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

OLBERMANN: To repeat an old analogy, it was about as surprising as the moment in Casablanca where the police captain shut down Rick's because he was shocked, shocked to discover that gambling was going on and then the croupier handed him his winnings. You know, not exactly a stunning revelation like a McCain campaign spokesman saying McCain doesn't speak for the campaign.

Our third story in the Countdown, the apoplexy has finally hit about Scott McClellan's no-duh announcement that his White House used to feed Fox News talking points. The apoplexy is not coming from, to quote more Casablanca, the usual suspects, liberal blogs, me, people who like the government to observe the laws, guys like that. It's from Bill-O the Clown.

Three days after McClellan confirmed to Chris Matthews that Fox talking heads like O'Reilly and Hannity were sent talking points by the White House, Bill-O took to the airwaves, telling his audience, "I never got a talking point in my life from anybody and McClellan's lying. OK, Scott? I'm calling you a liar. Got it? I lost all respect for you. I treated you courteously when you came on the program. No respect for you man, OK?"

Bill-O went on to excoriate anchors and TV critics who covered this story, and reminded us once again why you should never assume. "I know Matthews and Howard Kurtz, they know I would never take a talking point from anybody. So it's not like they're innocent, you know. they know. They don't care. McClellan is an idiot. You know he wants to sell his book."

His stupid rotten old book. Bill-O later refined his theme, calling in to the Fox Noise morning show to say, "this guy McClellan, he isn't a bad man. He's a weak man. He's weak. That's what you got to keep in mind. He goes on these programs and they pay him, just like Matthews just did. He's not smart enough to understand he's being used, being baited. To go in there and maliciously like the commentators at MSNBC do? No, he's just weak. He doesn't know what he's talking about."

To that point, for the thousandth time, Bill-O neglected to note the difference between MSNBC and NBC News; "former White House spokesman Scott McClellan continues to sell his book on NBC News. The two look to be partners in this enterprise." He continued, "I never once received a talking point from the White House. So McClellan is not telling the truth about me." Finally ending with, "by the way, McClellan would never dare say that to my face."

Finally today, Scott McClellan went on O'Reilly's radio show to expand on his written statement that he never mentioned O'Reilly specifically just Fox and that he was sticking with what he said to Chris Matthews.

(BEGIN VIDEO CLIP)

BILL O'REILLY, FOX NEWS ANCHOR: You seem, Scott, not to want to apologize to me. You don't have to, but I think you do owe me an apology.

SCOTT MCCLELLAN, FMR. WHITE HOUSE PRESS SECRETARY: I think I did by saying that I messed up.

O'REILLY: Well, you know what would be better if you say, look, Bill, I'm sorry, I didn't mean to do that.

MCCLELLAN: I didn't mean to do that. I'm sorry, Bill, I didn't mean to do that.

O'REILLY: Fine.

(END VIDEO CLIP)

OLBERMANN: And give me a big kiss. But when Scott McClellan tried to get an apology for himself, he learned a valuable lesson: a Bill-O never apologizes.

(BEGIN VIDEO CLIP)

O'REILLY: You've been on that network all day, every day to sell your book. I'm not apologizing for that. But he played you. You should be mad at him.

MCCLELLAN: So you don't owe me an apology for calling me a liar?

O'REILLY: You were a liar. You said I received talking points and I didn't.

MCCLELLAN: You said I looked to be partners in this enterprise with NBC. That's not the case. That's not true. You should apologize for that.

O'REILLY: You're crazy. Your partners with them in selling your book.

MCCLELLAN: I owned up. No I'm not.

O'REILLY: Yes, you are. You go on them all the time. They got first dibs to you.

MCCLELLAN: I haven't been on them for weeks.

(END VIDEO CLIP)

OLBERMANN: If we're partners, Scott McClellan owes me money. We're joined by our own Eugene Robinson, associate editor and columnist for the "Washington Post." Thanks for your time tonight, Gene.

EUGENE ROBINSON, "THE WASHINGTON POST": Good to be here, Keith. I think he owes me a little too.

OLBERMANN: All of us. If we've got to deal with McClellan, we made a bad deal. If Bill-O - speaking about making a deal, he made this deal all about him, that he never got talking points from the White House. But what about his producers, his commentators? What about the other Fox Noise machines like Hannity? They're not mentioned here. Are they conspicuous by their absence?

ROBINSON: Well, he certainly didn't mention anybody else. I mean, there was a certain kind of (INAUDIBLE) quality to his imperial pronouncement. But, you know, what I really love about that statement is he wouldn't dare say that to my face. This is a guy who has spoken some really inconvenient truths to the president of the United States, to Dick Cheney, to people like that. It just doesn't seem to me that Bill O'Reilly is that huge a deal for Scott McClellan.

OLBERMANN: Well, you might think that and Scott McClellan might think that, and I might think that, and 250 million Americans might think that, but Bill's not going to think that. That's the genius of Bill O'Reilly, and I acknowledge this whenever I get the chance, this ability to convince yourself of anything, you know, like a stalker does or an announcer for a last place sports team. Do you think he really manages to do it in this case, that he believes he's never received and parroted a White House talking point, even a second-hand one that's gotten through to him somehow?

ROBINSON: Oh, probably. I mean, look, it's not the feeding of the talking point so much as the scarfing down and regurgitating. And probably he has convinced himself or he may have convinced himself that he didn't. You know, I got to confess, I'm not a regular watcher of the O'Reilly show. I've been on it once. I anticipated being sandbagged. I was promptly sandbagged. And I've not had to repeat the experience, I've chosen not to.

One thing I did notice in that brief appearance about three years ago is that objective fact often does not enter into the discussion. In fact, it kind of gets waved off and discarded as kind of a mere bagatelle (ph) in service of whatever point he's trying to make. So does he really convince himself of this stuff? I don't know. And I guess I don't think I need to know.

OLBERMANN: But the reason I ask that is the other night - and this goes back to that basic tenet that almost everybody knows about psychology, that the first sign of mental health or mental ill health is whether or not you can correctly place yourself in the universe, roughly. Do you have a vague idea how other people see you? And he said the other night, "moderates like me." And I'm thinking moderate versus who, Attila the Hun?

ROBINSON: Yes, moderate is not the classification that springs to mind when I'm thinking about Bill O'Reilly. But, you know, look, the guy's place in the universe, I believe, according to Bill O'Reilly would be approximately at the center. And I think you can kind of take it from there. Although I do love that, of course, Scott McClellan fell into the trap, of course, on the radio today thinking that he was going to have a civil conversation and that he would apologize and then Bill would apologize. Bill ain't going to apologize. It ain't going to happen.

OLBERMANN: We know the White House sent out talking points. McClellan says this and I can tell you, from personal experience, I still have them. In 2004 - in retrospect, this looks like one of the great wastes of all time - they sent me a set of talking points, not fully understanding the nature of the show even in 2004, before I sat down and interviewed Joe Wilson. McClellan didn't make this stuff up. In that context, is there a classic Fox News maneuver here, separate from O'Reilly, take the attention away from the real story here that it regularly took talking points from the White House, which in fact could in fact be a violation - there are anti-propaganda laws on the books. This could be a violation of those. Do you change that into this another perceived smear against his journalistic holiness cardinal Bill O'Reilly?

ROBINSON: Well, you know, that's kind of the O'Reilly line and in many ways the Fox line that everybody's ganging up on us and accusing us of all these terrible things, when we're just being fair and balanced. Again, it is not so much the White House putting out a bunch of talking points. I get talking points from the Republican party, from the White House, from everybody. Everybody throws you talking points. It's what do you do with them? And do you - you know, when they come across, do you say, a-ha, now I've got it, this is what I've got to say on the air today. That's the big question. And I guess it wasn't really answered even amid all the bombast. I'm not sure we've gotten to the bottom of it.

OLBERMANN: I think we know the answer from past evidence. The vice president there takes those talking points and makes his own talking points and sends them out to everybody in the news organizations. We've seen copies of that. Anyway, we'll leave it alone here. Gene Robinson of MSNBC and the "Washington Post," thank you, Gene.

ROBINSON: Good to talk to you, Keith.

OLBERMANN: As you may have heard, this is shark week. Of course, from the shark's perspective, it turns out this was Ryan Seacrest week. And if you haven't seen this yet, welcome to New York police courtesy week. I say that as the descendant of several New York cops. Worst persons ahead on Countdown.

(COMMERCIAL BREAK)

OLBERMANN: You always thought Ryan Seacrest would eventually jump the shark. Shark bites ubiquitous host. That's ahead, but first time for Countdown's number two story, tonight's worst persons in the world.

The bronze to L. Robert Kimball and Associates and the operators of the Santa Rosa County jail in Milton, Florida. The Kimball Company designed the jail from which two men awaiting trial on serious charges escaped by squeezing through a 12 inch by 12 inch opening, then into a narrow area and up on to the roof and then off the premises. County spokesman explains the inmates took advantage of a, quote, design flaw. The architects said they were unaware of the, quote, design flaw. Design flaw, in other words, a hole in the jail. Just say it plain. They got out through a hole in the jail.

The silver to rookie officer Patrick Poguen Jr (ph) of the New York Police Department. We'll tell you his version of the story, then show you the amateur video of the incident he was describing. The bicycling protest group Critical Mass rode through Times Square in New York at about 9:30 at night, disturbing the peace by ringing their bicycle bells. Suddenly, said rookie officer Poguen, formerly a high school football offensive lineman, as you will see, he saw cyclist Christopher Long weaving in and out of lanes and obstructing traffic. Officer Poguen's deposition reads: "the defendant steered the defendant's bicycle until the direction of the deponent, the officer, and drove defendant's bicycle directly into deponent's body, causing deponent to fall to the ground and causing deponent to suffer lacerations on deponent's forearms. Then cyclist Long resisted arrest."

Here's the videotape and there's Officer Poguen. He's moving to the right like he's looking for somebody. Here comes Mr. Long. There is Mr. Long trying to run him down by letting him body check him. There is Mr. Long resisting arrest by lighting from the vehicle, flying onto the sidewalk after officer Poguen nearly clothes-lined him.

Unfortunately for the officer, he told his story in an official report, so he may be guilty not merely of assault but also of perjury. Plus, the NYPD has been beating up the Critical Mass folks off and on since the 2004 Republican convention. Plus, the arrested protester, Mr. Long, oops, he's an Army vet. Plus, the officer's father is a retired NYPD detective who was on the Joint Terrorism Task Force and really helped his son's case by telling the "New York Daily News," quote, I'm proud of my son. You got to do what you got to do to make an arrest.

Our winner tonight, fixed news commentator Charles Krauthammer, convinced that Barack Obama's speech in Berlin was a bad idea; quote, you don't get a bounce out of standing in front of 200,000 Germans at a rally who are chanting your name. Bad vibes sometimes historically."

I know where you're going there. You want to make people think about Obama and that Nazi guy, like when that other American fellow stood in front of 50,000 Germans in Berlin at a rally and they were chanting his name in that speech about tearing down some wall. What's his name? Reagan somebody? You're comparing him to Hitler, too, Chuck? Charles Krauthammer of Fox Noise, today's worst persons in the world.

(COMMERCIAL BREAK)

OLBERMANN: Only the most bitter and cynical of you might be sitting there thinking this is many will almost the story Olbermann has always dreamed of covering; Ryan Seacrest eaten by a shark. In our number one story on the Countdown, shame on you. I never wish that on anybody. Besides which the shark only took a small bite out of him. He didn't even miss work at any of his 445 jobs.

(BEGIN VIDEO CLIP)

RYAN SEACREST, "AMERICAN IDOL": Of course, a thousand people in the ocean and I get bit by the shark. He took a bite, but then he left. so I thought, good god that was not a rock. I thought maybe it was a crab. I thought maybe a blue crab or something grabbed on to my toe.

UNIDENTIFIED FEMALE: Then you found the tooth.

SEACREST: Well, that wasn't a great thing to find. It was like finding a splinter.

UNIDENTIFIED FEMALE: Yes.

SEACREST: Did I show you this?

UNIDENTIFIED FEMALE: Yes, you showed me. It's like a jagged cutting.

SEACREST: It's like three holes.

UNIDENTIFIED FEMALE: It is, yes. There are holes like fangs and it's all jagged. Just like a shark, like it wanted to shred your toe off.

SEACREST: Don't let me fool you by my unbelievably comfortable state of being on the air right now, because I'm in pain.

(END VIDEO CLIP)

OLBERMANN: Now you know how the audience feels. As it turns out, the menacing creature, nothing more than a sand shark, not a land shark but a sand shark, expressed its opinion of the state of "American Idol." While both it and Seacrest were in about four feet of water, a sand shark the size of a cat, as even Seacrest admitted, making it even smaller than Mr. Seacrest. Seacrest even managed to bury his own encounter with a not so great white, interviewing Miley Cyrus. She apologized for this Youtube short in which she and a friend, mock rival teen queen Selena Gomez (ph). The video one of a handful of harbingers that the incumbent American girl's idol is outgrowing alter ego Hannah Montana. She says the third season might be her last. Disney underscores their option for a fourth. And they added something about releasing the sharks.

There's but one person qualified to discuss the implication of the Seacrest sea crisis, and possible retirement of Hannah Montana, the mid day host of classic rock station Q-104.3 here in New York, Countdown's very own "American Idol" princess, Maria Milito.

MARIA MILITO, Q-104.3: Hello, thank you for having me here. OK, Ryan Seacrest is a radio guy, and it is shark week on Discovery. It's a radio promotion, don't you think?

OLBERMANN: You don't think there was an actual shark?

MILITO: I don't think so. Of a thousand people, as he said, the shark went for him and bit a toe? Don't sharks bite like half your torso or a leg.

OLBERMANN: If it's a four-inch long shark, or whatever it was, a four-foot long shark.

MILITO: You know, I bet if they look close enough at the shark, it had Discovery's logo on its head. Don't you think?

OLBERMANN: Or it was a shark with freaking laser beams.

MILITO: Or a remote control, the guy on the beach who works for Discover. there's Ryan Seacrest. That's how radio people think.

OLBERMANN: What's the cross promotion though? What's the benefit for him?

MILITO: I don't know. Maybe that's the next job, 450th job for Discovery. Maybe?

OLBERMANN: Is it a reason for us to now like sharks?

MILITO: I guess. Maybe sharks need a positive spin. There have been some reports this weekend of shark bites and eating people. So - and shark week is happening. So I don't know. Maybe.

OLBERMANN: But it's a very, very serious issue, obviously, when sharks eat people.

MILITO: Yes.

OLBERMANN: But it does beg the question, do you think they've ever considered this at "American Idol," what to do if any of the major players are eaten by sharks. If Randy were suddenly consumed?

MILITO: I'll be a judge. That's why I'm here. Isn't that why I'm here?

OLBERMANN: And two or more - Oh, I get it.

MILITO: It's an audition for "American Idol." Come on, the show would last a week if you and I were judges.

OLBERMANN: Leave the shark out of this.

MILITO: Very good.

OLBERMANN: The manipulation of this situation, they've got to do something on it during the season, right?

MILITO: I would think, unless something else happens between now and then. But the auditions are happening now, so it's publicity. His name is out there again. I'm sorry, I think like a radio person. It's promotion in motion.

OLBERMANN: One of your bosses called you today and said, do you know any sharks.

MILITO: No, it would be tomorrow. Not today.

OLBERMANN: Grease those mid day numbers.

MILITO: Get your leg eaten off. OK, no problem.

OLBERMANN: Miley Cyrus, girl next-door no more? Do we care about this? She'll wind up in rehab or what?

MILITO: To me Miley Cyrus is birth control. Think about it.

OLBERMANN: Yes.

MILITO: She needs to go away. She's almost 16. She needs to go away

I'm just - that whole "Vanity Fair" photo shoot, everyone is distracted by the fact that she didn't have a top on. It was icky. For lack of a better word, with her dad. That picture was horrible. There's something really yucky about that.

OLBERMANN: Well, the mullet.

MILITO: Besides his mullet, but that's your father. Come on.

OLBERMANN: It's no worse than that ABC dancing with your dad show or whatever it was.

MILITO That's a show. You are supposed to dance with your dad. This is like a sexual photo.

OLBERMANN: You didn't see it when they danced.

MILITO: No, I wasn't watching that, I'm sorry. That photo disturbed me more. She needs to go away. It's time, don't you think? Then she can be in rehab at some point.

OLBERMANN: Then make a comeback at 25.

MILITO: Exactly, she can be the next Britney Spears.

OLBERMANN: Isn't Britney Spears the next Britney Spears? She hasn't made the comeback yet.

MILITO: Not yet. No one told her yet. Not yet.

OLBERMANN: Maria Milito of Q-104.3 here in New York, our "American Idol" princess and shark expert, thank you. That's Countdown for this the 1,917th day since the declaration of mission accomplished in Iraq. To all our friends in southern California, hang in there and do not hang glass-framed pictures in your bedrooms. Thank you. I'm Keith Olbermann, good night. good luck, and remember, John McCain does not speak for the John McCain campaign.

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