'Countdown with Keith Olbermann' for Tuesday, August 12
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Video via MSNBC: Oddball, Worst Persons

Guest: Chris Kofinis, Rachel Maddow, Howard Fineman, Jonathan Turley

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

The Clinton memos, a campaign in chaos, a strategy tone deaf, a candidate not in charge, and the attempts to paint a rival as "not at his center fundamentally American in his thinking and in his values."

(BEGIN VIDEO CLIP)

JOSH GREEN, THE ATLANTIC: What the document shows is that the campaign was forever at war with itself and a candidate that never steps in to make an objective decision about who was right, who was wrong.

(END VIDEO CLIP)

OLBERMANN: And which of McCain's talking points actually originated with Mark Penn? How about combat as the answer to every international crisis?

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R-AZ) PRESIDENTIAL CANDIDATE: Russia has used violence against Georgia to send a signal, any country that chooses to associate with the west and aspire to our shared political and economic base.

(END VIDEO CLIP)

OLBERMANN: Again today, the Republican continues to saber rattle even though all our sabers are busy and despite the insanely inappropriate conflict of interest. His foreign policy advisor has been a paid lobbyist for Georgia and has now gone out with him on the campaign trail.

No prosecution. The attorney general slams his predecessor and the endless violations of law inside the politicization of the Justice Department, then knuckles under to the Bush administration, "Not every wrong," says Michael Mukasey, "or even every violation of the law is a crime." Jonathan Turley joins me.

Dick Cheney, the featured figure at a fundraiser for a Republican congressman - a Republican congressman who was once caught by the cops while he parked in his car with a prostitute with his zipper down.

Factor fiction. "Bill-O the Clown" announces he held back the John Edwards story last spring out of respect for Elizabeth Edwards then explains "the committed left press ignored the 'National Enquirer' investigation, the question now is, who paid to hide the story? Millions of dollars exchanged hands. That money must be accounted for."

Paying to squelch coverage of a sex scandal? Why does that sound so familiar?

All that and more: Now on Countdown,

(BEGIN AUDIO CLIP)

BILL O'REILLY, FOX HOST: So, it's not a negligee situation.

(END AUDIO CLIP)

OLBERMANN (on camera): Good evening. This is Tuesday, August 12th, 84 days until the 2008 presidential election. Within 24 hours of the revelation, that during her presidential campaign, Senator Hillary Clinton was advised but refused to try to paint Senator Barack Obama as somehow unpatriotic or un-American, comes the first clear, non-nuance, anything but subtle attempts by the McCain campaign to try to paint Senator Barack Obama as somehow unpatriotic or un-American.

The fifth story on the Countdown: And it's all been dressed up in the guise of seeming bipartisanship by the politician who defines the age old warning that there is no zealot like a convert, Republican in everything but name, Senator Joe Lieberman.

At a campaign appearance today, Lieberman, a strong ally of McCain's, introduced the senator by saying the race is between, quote, "one candidate who has always put the country first, worked across party lines to get things done and one candidate who has not."

The mudslinging then, quoted later today, in an official McCain fundraising e-mail, the Web site Talking Points Memo reports, despite last month's pledge by McCain's campaign not to question the patriotism of Barack Obama. The strategy of questioning Obama's Americanism first laid out by Clinton chief strategist, Mark Penn, in one of 200 campaign memos just obtained by "The Atlantic" monthly, about which more is coming up.

First, the Penn memo, March 19th, 2007, quote, "All of these articles about his boyhood in Indonesia and his life in Hawaii are geared towards showing his background is diverse, multicultural and putting that in a new light. Save it for 2050. It also exposes a very strong weakness for him - his roots to basic American values and culture are at best limited. I cannot imagine America electing a president during a time of war who is not at his center fundamentally American in his thinking and his values."

Penn's recommendation, a campaign of insinuation to emphasize Obama's, quote, "lack of American roots," by literally using the word American a lot and waving flags a lot. Quote, " We are never going to say anything about his background, we have to show the value of ours" Quote, "The right knows Obama is unelectable except perhaps against Atila the Hun," wrote the man who's candidate proved less electable and who's advice helped to sink her.

But with McCain now attacking Obama's patriotism, it remains to be seen how deeply he can mine (ph) Obama's childhood during which, even though he did indeed spent part of it in Indonesia, he was raised largely by a single mom and World War II veteran granddad in America.

Vital details in so much as McCain too was raised almost entirely by his mom in a military family and also had an itinerant childhood, and unlike Obama, was not even born in America - John McCain was born in Panama.

Let's bring in MSNBC political analyst, Howard Fineman, also, senior Washington correspondent for "Newsweek" magazine, who is at today's McCain's festivities in Pennsylvania.

Howard, good evening.

HOWARD FINEMAN, MSNBC POLITICAL ANALYST: Hi, Keith.

OLBERMANN: What happened to the McCain pledge of not questioning Obama's patriotism? I mean, if it does not include patriotism, what exactly does Americanism mean exactly?

FINEMAN: Well, McCain didn't so much just wrap himself in the flag up in York today, he was in it tighter than one of the swimmers in the Olympics in those new bathing suits. I mean, they not only did the Pledge of Allegiance and "The Star-Spangled Banner," they did "God Bless America," again, they did a whole number of things to try to emphasize in York, Pennsylvania, this old colonial town in east central Pennsylvania, the American theme that John McCain is running on.

And I was there when John - when Joe Lieberman introduced him and said, you know, "We want one guy who puts America first and reaches across party lines and one guy who does not." And it struck me as fighting words for sure and it will be interesting to see what if anything the Obama campaign does about it. I asked them for comment, so far, they haven't had any, maybe they feel it doesn't need any, it will collapse of its own weight.

OLBERMANN: But, if Obama's father were a white Englishman, and Obama had attended school in Ireland for a while as a kid, would any of this have any meaning? I mean, is this not all about six inches away from being racism?

FINEMAN: Well, I don't want to measure it but I would say that it's about not necessarily specifically or solely race, it's about the idea of mystery and difference. It can take all kinds of forms, it can take allegations of elitism, it can take allegations of religious backgrounds - race may be part of it.

I still don't think if you said to McCain flat out, "Do you approve of that kind of message," that he would necessarily agree with it or support it. But there's no doubt that that's the implication of what Lieberman said and what Mark Penn's memos are about. As you pointed out, Keith, Hawaii is part of the United States.

And there's actually an argument about whether McCain can even run, be sworn in as president whether he's a natural born citizen, having been born in the Canal Zone. So, at least in literal constitutional terms, you know, McCain ought to be careful here. Obviously, it means more than that. But it was interesting to me to see this event in York, a very traditional town, very few minorities in the audience. They had a big crowd, very excited crowd. Very few minorities of any kind and McCain can't win the election just with those voters.

OLBERMANN: And let's also be clear, whatever it says now, clearly when McCain was born in the Canal Zone, that was considered U.S. territory. So there's not actually a question of it. But it is kind of odd that the guy who was born in, essentially South America, is questioning whether or not the guy was born in a United States' state is American enough.

And the other irony here, was it lost on whoever gave the green light to this inside the McCain, was it lost on Mark Penn that Americanism, when we wave the flag, we think of it in terms of equal opportunity, no matter heritage, religion, father's income, line of work, and the guy who stands at the back - Mark Penn and whispers this one is not one of us - that that's the un-American guy in the standard construction of what this country is?

FINEMAN: Well, you just drill (ph) what I think would be a pretty good ad for the Obama campaign because that's exactly the point. And I think Obama in many ways - the Obama story is the American story. And certainly, if Obama were smart, he would try to push this right back on people like Joe Lieberman, who should know better if that's what Lieberman meant.

You know, I was there listening and Lieberman said, "One guy puts America first and reaches across the aisle and another guy doesn't." Now, he could maybe parse it, but I haven't heard him try to parse it. As a matter of fact, the McCain campaign sent that whole statement out very proudly tonight.

OLBERMANN: Exactly. Yes, there is no zealot like a convert.

Howard Fineman, MSNBC political analyst, senior Washington correspondent for "Newsweek" - thank you, as always, sir.

FINEMAN: Thank you, Keith.

OLBERMANN: His un-American plan aside, Mark Penn featured prominently in the other e-mails obtained by "The Atlantic" magazine, Penn's rivalries with other Clinton aides were well known. But according to "The Atlantic's" Josh Green, the campaign e-mails portrayed Clinton, despite her ready to lead rhetoric, as unable or unwilling to lead her own staff.

(BEGIN VIDEO CLIP)

JOSH GREEN, THE ATLANTIC: What the documents show is that campaign forever at war with itself and a candidate that never stepped in to make an executive decision about who was right, who was wrong, and which strategy would carry her to the White House.

(END VIDEO CLIP)

OLBERMANN: And though Clinton signed off on the infamous 3:00 a.m. ad, for instance, Penn could only get it, his idea, on the air after Bill Clinton gave the go ahead. But as (ph) the most instructive for the remainder of this campaign, "The Atlantic" also reports that such attacks on Obama's experience now favored by the McCain campaign proved in Mark Penn's own polling to be the worst way to hit Obama.

Let's bring in Democratic strategist, Chris Kofinis, former communications director on the Edwards campaign.

Thanks for joining us again tonight, Chris.

CHRIS KOFINIS, DEMOCRATIC STRATEGIST: Thanks, Keith.

OLBERMANN: We'll get to the experience and attack issue, but let's visit first this issue of staff management. Clinton and McCain have had major campaign staff shake-ups a couple of times each, and are selling simultaneously their own leadership and experience against a guy who's had no campaign shake-ups. How well does that work?

KOFINIS: Well, it's an interesting juxtaposition, isn't it? You had two campaigns, the Clinton campaign and the McCain campaign that kind of imploded under the weight of their egos in those campaigns and you have one, the Obama campaign has been humming along pretty well.

Now, I'm not sure how well it correlates to how you govern in the White House, but it sure give people, I think, a lot of pause about the McCain camp if they do win the White House.

The part that, I think, troubles me the most is not simply the question of shake-ups, it's the leaking. In particular, that when you saw during, you know, during the Clinton campaign, you know, it seemed like some of their advisors were willing to fight out every single battle on the front page of the "New York Times" or the "Washington Post".

It just makes you wonder what it would have been like had they won the White House. It would have been, I think, a terrible thing. They did a great disservice to Senator Clinton choosing to fight her battles not internally but externally. That's the unfortunate thing but that's how it works sometimes in campaigns.

OLBERMANN: As a campaign insider yourself, can you outline some of the reasons why McCain went ahead and decided on this experience attack despite the poor showing in the internal Clinton polls?

KOFINIS: Well, when you got nothing else, I guess you go with what you got. And the reality here is, it's not going to work for a lot of different reasons, but what they're betting on is it's going to work better in the general than in the primary.

Here's the biggest problem and it's kind of funny if you think about it - what voter in the entire United States does not think that John McCain is more experienced? He's 72 years old. Is there any doubt?

The problem here, I think, is much more significant. It's not a question of experience, it's a question of who has good ideas and good solutions. And if the choice is between an inexperienced candidate who has good ideas and good solutions and an experienced candidate with bad solutions and bad ideas, guess what? They're going to choose a candidate like Senator Obama who's going to lead this country in a better direction.

It's pretty simple for my perspective. So, I think it's a bad strategy. I don't think it's going to work.

OLBERMANN: You heard Howard Fineman's witness report from York. What do we read into McCain's use of the Lieberman's line, not putting country first? Does that signal some sort of sea change in this campaign or is this some sort of field testing of the dumb line of the week?

KOFINIS: Well, I think it's a bit of both, and it's a troubling, you know, potential escalation of the campaign. Listen, the McCain campaign decides to go down this road where they, not only have changed their position not to question the patriotism of Senator Obama or any candidate, but they've chosen to go down this road whether judging or critiquing Senator Obama's supposed not American enough.

I mean, this is a very dangerous line of attack; they have crossed a political robocan (ph). And, I think, what you're going to see from the Obama campaign, at least my advice to them is to hit back and hit back ferociously. I mean, this is unacceptable, I think, in any political race and it really, I think, shows a desperation.

You know, Lieberman did not do that by accident, I don't buy that for a moment. How it works in campaigns is surrogates will go out there and test these lines and they're going to wait and see what the blowback is. The blowback, in my perspective, should be fierce and pretty strong. It's unacceptable. I don't care what candidate does it from what party.

OLBERMANN: And last point about what candidate didn't do. I think I'd be doing a disservice here in not pointing out the one positive in all this stuff, cascading out in those e-mails, when Mark Penn wanted Hillary Clinton to hit Obama on this, she refused. Whatever else she did or she didn't do, she refused. That is to Senator Clinton's enormous credit, is it not?

KOFINIS: It is, it really is. And, you know, Mark Penn, you know, evidently had a strategy where he was willing to destroy the village to save it and what he didn't understand is that he would have destroyed Senator Clinton's candidacy in the process even if she had won. It would have been a terrible way to win a nomination and, I think, it probably would have cost her the White House.

You know, I think, Senator Clinton did the right thing here and it's really a testament that, you know, she was not willing to cross this line, it's not the line that any candidate should cross.

And, I think, it tells you where the McCain campaign is going, that Senator Lieberman has chosen to cross this line and Senator McCain is basically backing it up. It's a terrible, terrible thing, but this is where their campaign has decided to go, it looks like.

OLBERMANN: We'll see how it plays out. Chris Kofinis, former communications director for the Edwards campaign. Thank you, Chris.

KOFINIS: Thank you, Keith.

OLBERMANN: The campaign is not just playing with questions of patriotism and maybe even racism, there is jingoism going on in York, Pennsylvania, as the candidate continues to rattle sabers over Georgia and Russia and boasts that that makes him a commander-in-chief while insisting there's no room for partisanship over this consecutive.

And the quote of the day, "The question now is, who paid to hide the story? Millions of dollars exchanged hands, that money must be accounted for." Was Bill O'Reilly talking there about the John Edwards sex story or the Bill O'Reilly sex story?

(COMMERCIAL BREAK)

OLBERMANN: Only a cynic would suggest John McCain and his foreign advisor, until this March a paid lobbyist for the nation of Georgia, are using the Georgia-Russia conflict for political gain. Well, the McCain campaign can turn you cynical pretty fast.

Bushed: The vice president is raising funds for the congressman who forgot to raise his zipper.

And: Factor fiction. Bill O'Reilly calls John Edwards a liar for saying there are 200,000 homeless vets, then he misquotes a government report and claims there are only 10,000 when that report actually says there are 208,000.

You're watching Countdown on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: It was an extraordinary sign of solidarity echoed by politicians and newspapers across the world on September 12, 2001 - cutting through geographic and geopolitical divides. Today, we are all Americans.

Our fourth story on the Countdown: Senator McCain appropriating even that sentiment for his own political gain, declaring that even as he raised the ghost of the Cold War, quote, "Today, we are all Georgians," especially those of us who got paid to lobby for Georgia.

McCain tonight, is raising the stakes, telling FOX News, quote, "There's no room for partisanship now in discussion of the conflict" as he inserted partisanship into discussion of the conflict.

As Russia announced it's withdrawal from Georgia and both sides agreed to a ceasefire, though it's unclear if the fighting has actually stopped, Senator McCain launched a new offensive, pointing to the town hall meeting in York, PA., that Georgia is one of the oldest Christian countries in the world and that it has an oil pipeline cutting across the country, that he has visited the country several times, and his friends with the Georgian President Saakashvili, who were once nominated him, in fact, for a Nobel Prize, even though he consistently mispronounces his name as Shaskavili (ph).

But he neglected to mention that his top foreign policy adviser, Randy Scheunemann, who used to lobby from 2004 until March of this year, has now joined him on the campaign trail and briefed reporters tonight. And Scheunemann remains close to Georgia's president which might explain why President Saakashvili quoted Senator McCain at a rally this afternoon, and they also explain why Senator McCain is now using Cold War rhetoric to describe Russia's intentions.

(BEGIN VIDEO CLIP)

MCCAIN: The impact of Russian actions goes beyond their threat to a democratic Georgia. Russia has used violence against Georgia to send a signal to any country that chooses to associate with the west and aspire to our shared political and economic values. My friends, we learned at great cost the price of allowing aggression against free nations to go unchecked.

(END VIDEO CLIP)

OLBERMANN: During the Crimean War. The senator going even further in an interview with public radio station, WITF there, claiming, quote, "I think it's very clear that Russian ambitions are to restore the old Russian Empire, not the Soviet Union but the Russian Empire," Russian Empire which might include Alaska." Any doubt to the political purpose of such fearmongering and warmongering, laid to rest by Senator McCain's stump bunny (ph), Joe Lieberman, albeit off camera.

(BEGIN VIDEO CLIP)

SEN. JOE LIEBERMAN, (I-CT) MCCAIN SUPPORTER: We have seen it in the last few days as the Russians invaded a sovereign nation, Georgia, and watch the response of this man, John McCain to that crisis - right, strong, clear, principled, the kind of president we need in the White House over the next four years, to be there to protect our country, our security, and our freedom.

(END VIDEO CLIP)

OLBERMANN: Joining me now, our own Rachel Maddow, host of the "Rachel Maddow Show" on Air America Radio.

Thanks for coming in, Rachel

RACHEL MADDOW, AIR AMERICA RADIO: Hi, Keith.

OLBERMANN: Incidentally, four more years, he said, not eight.

There's no room for partisanship now. Between that asinine remark of McCain's and the pious gibberish of Joe Lieberman there, could not somebody involved in this have made the effort to look just slightly like they were not trying to exploit what's happening in Georgia for political gain?

MADDOW: Yes. What a handy little war this has turned out to be, right?

OLBERMANN: Yes.

MADDOW: I mean, Russia provokes Georgia on the moving of South Ossetia, so that it can, you know, it can have an excuse to roll into Georgia, to quash Georgia, to quash any democratizing impulses that might emerge from there and so that it can also take out some of the oil competition for its own oil companies, right?

And then Georgia feels emboldens to rattle Russia's chain this way because of all the "Yea, democracy, yea, Saakashvili" rhetoric that's coming from Washington because Washington needs to mint ourselves a new ally and because we need to be able to characterize the invasion of Iraq as part of some noble, larger freedom agenda, instead of what it was, which was an oil grab.

And now, you got John McCain's campaign crowing about what a lucky little bit of political staging this war is (ph). For all the political celebrating, you can hardly make up the thousands of dead civilians there.

OLBERMANN: Two of the McCain stated reasons for protecting Georgia: Christ and oil. And apart from the fact that it's sounding more and more gold-warterian (ph) here. Are these good enough reasons to reignite the Cold War?

MADDOW: Yes, him and what army?

OLBERMANN: Yes, well.

MADDOW: We're not going to go to war with Russia any time soon. I mean, obviously, Russia is way out of line, and Russia under Putin is not only a threat to that region, but is a threat to the global order of things and it's a scary thing. But there's two ways to approach that, you either invade Moscow or you decide to try to unite the world and unite NATO even in opposition to what Russia is doing.

You don't do that by taking off your shoe and pounding it on the podium and saying, "I'll get you Russia, my foreign policy guy is a registered lobbyist for your country, the country that you just invaded." That's not the way you move things forward in the same way.

OLBERMANN: By the way, how is that not a gigantic front page conflict of interest in the middle of that what is apparently still a shooting war?

MADDOW: Yes. Randy Scheunemann, top foreign policy aid to John McCain until March, the registered foreign agent of the government of Georgia, one of the two parties involved here. And so, McCain coming out, bellicose as all get out, on raiding into this conflict, essentially with talking points that were bought and paid for by one of the governments that is party to this conflict. You want to look like an honest broker, that is not the way to do it. You don't take Randy Scheunemann out on the campaign trail with you to show off your lobbyist.

OLBERMANN: Well, and having brief the reporters on the plane coming back from Pennsylvania.

A hundred years in Iraq we have heard that, or a month, somewhere in-between perhaps, but 100 or a month, the "Bomb, bomb, bomb Iran song," and now this garbage between Russia and Georgia and its exploitation by the McCain campaign, you use the word bellicose, it seems worse than that, it seems more bellicose than what Bush and Cheney put out for eight years.

MADDOW: It is remarkable that John McCain is staying so true to the caricature in terms of the idea that he goes off half-cup (ph) and he sees wars as the answer to everything. I would love to hear John McCain talk about a response to an international crisis that does not involve threatening the use of the U.S. military force.

We can't use the military for every problem in America and around the world. But John McCain, that's his first recourse. Whenever anything arises, I think the military would probably like to hear how he plans to use them in every country around the globe. I think we, as the voters, should figure that, too.

OLBERMANN: Well, I think, if, you know, you cast your vote for McCain, you're going to have to remember - keep your rocks and your sticks handy by your door because you may be called to service, no guns of course.

Rachel Maddow of Air America and MSNBC - thank you, as always.

MADDOW: Thank you, Keith.

OLBERMANN: So, exactly, what is that naked man washing in the sink at this "burger king"? Is it a quarter pounder?

And it staggers the mind, a domestic airline not only charging regular passengers money for extra luggage, but charging American soldiers money for extra luggage. Worst Persons is ahead.

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

Number three: War profiteer-gate. Now, it's the Congressional Budget Office confirming our worst fears, this has largely been about not democracy, not threats, not freedom, but cash. By year's end, the survey says the American taxpayers will have given $100 billion of our money to private contractors doing business on the war in Iraq or here at home. That's about 1/5 of all war costs. One (ph) remainder: The purpose of having a war in Iraq is to have a war in Iraq.

Number two: The gears grind slowly-gate. The Democrats flatfooted after Ron Suskind's revelation that the Bush administration had ordered a letter linking Saddam Hussein to 9/11 plotter, Mohammed Atta, forged in 2003, still flatfooted even after the magazine, "The American Conservative" confirmed the story, they have finally woken from their slumber a bit.

House Judiciary Chair John Conyers said today, he has asked his staff to review the story of the forged document and other items reported by Suskind. No hearings yet, no testimony, no putting members of the administration in a stockade and providing everybody in the country with a carton of rotten eggs, just a review.

And number one: Cheney-gate. The proposition that the vice president is one living breathing manifestation of corruption and scandal underscored by news from San Diego that Mr. Cheney will be attending a fundraiser there for Republican Congressman Ken Calvert. In fact, he'll be delivering a speech on Representative Calvert's behalf at the event in a private house at the old Nixonian homestead of San Clemente.

Congressman Calvert is one of the all-time greats, once chosen one of the 22 most corrupt members of Congress. He's directed pork projects to a K Street lobbying firm while it was under a federal investigation. He's accompanied the long since caught Congressman Duke Cunningham in one of his sojourns to Saudi Arabia.

He's been accused of personally profiteering off an earmark he attached to a piece of legislation. And 15 years ago, he was caught by police in a parked car with a prostitute. As he tried to drive away, the police noted that Mr. Calvert insisted, "We're just talking, that's all." While he, quote, "continued to cover his unzipped pants with his hand."

And the vice president is helping this man increase the size of his reelection fund.

(COMMERCIAL BREAK)

OLBERMANN: Bests in a moment. And that's what happens when a gust of wind hits the giant dog poo sculpture. First, on this date in 1881 was born Cecil V. Demille (ph), who would direct at least 80 films from silent days through Charlton Heston in the "Ten Commandments" in 1956. That film inspired a possibly apocryphal story, best told in the words of one of his leading men, Clint Walker, about the filming of Moses parting the Red Sea;

It was quite a project. So many people were involved and it wasn't a scene you could do over and over again. They had at least three cameras shooting it from different angles. After the scene was shot, Demille says to the first cameraman, well, how did it go? The first cameraman says, I'm terribly story, Mr. Demille, there was a hair on the lens. So Demille hollers to the second cameraman and that cameraman yells, Mr. Demille, one of the horses knocked the camera over half way through the scene. Finally, Demille holler into the distance at the third cameraman, far, far away, and the guy yells back, ready when you are, Mr. Demille.

Let's play Odd Ball.

(BEGIN VIDEO CLIP)

OLBERMANN: Here's a movie of a different kind from Longmont, Colorado, with still images from a porn shop surveillance camera of a Longmont police detective with the pornography age verification unit gathering evidence. Only there is no Longmont pornography age verification unit, meaning this guy is either a vigilante out for justice or a lying dirty porn hound. Police are assuming the latter. The perp used a fake badge to gather evidence three times before the genius behind the counter figured out the ruse. Longmont PD says it is now on the lookout for the detective. And warned his friend may be disguised as an official Longmont bikini inspector.

Two a Burger King in Zenia (ph), Ohio, where employees must wash their hands after using the restroom, in a bubble bath in the restaurant's kitchen sink. This is one of the King's employees, who calls himself Mr. Unstable. Completely naked and as other employees work around him, rinsing his Whopper. The video surfaced on the Interweb yesterday. Mr. Unstable and crew were let go. The store says it threw out 10,000 dollars worth of potentially contaminated equipment. They also sterilized the sink twice. Now if they could only help us sterilize this image out of our heads.

(END VIDEO CLIP)

OLBERMANN: The minions of Alberto Gonzales violated the law, but the attorney general will not hold them legally accountable, because he says not every violation of the law is a crime. I think we need to see your degree too, buddy.

And Bill-O insists millions of dollars have changed hands to buy the media's silence on a sex scandal. Andrea Mackris, hello. These stories ahead, but first time for Countdown's top three best persons in the world.

Number three, best expression of the Olympic spirit, Francesco D'Aniello, the Italian police officer who today won silver in the double trap shooting at the Olympics, and promptly spent his moment before the world's media talking about how the Italian government should give him a tax exemption on the award money it gives for winning an Olympic medal. Swifter, higher, stronger, greedier.

Number two, best dumb criminal, Masayuki Ishikawa, who got angry at passersby looking at him on a Tokyo street. What are you staring at, he asked before attacking two people and then robbing them of 160 dollars. At the time, Mr. Ishikawa was dressed up as Winnie the Poo. Two friends were dressed up as a mouse and a panther respectively. He claimed they were dressed that way because they had run out of clean clothes.

Number one, best cliche come to life, the events that unfolded at the Paul Clee (ph) Museum in Bern, in Switzerland. An inflated sculpture by American Paul McCarthy got caught in a wind of some sort, broke loose from its mooring and drifted off 200 yards into the yard of a children's home. The inflatable sculpture blown away by the sudden gust depicted a giant dog doo. And that's what what happens when the crap hits the fan.

(COMMERCIAL BREAK)

OLBERMANN: A young ambitious political appointee charged with vetting job applicants aims to populate the lands most powerful law enforcement agency with hires cast in her own pious, but not exactly honest, image: anti-abortion, against same sex marriage, blindly loyal to President Bush. Our third story in the Countdown, if it sounds like she broke the law in doing that, her boss's successor acknowledging today she did, but he still won't prosecute.

Not Monica Goodling, nor her Bible thumping associates will suffer consequences as criminals. Attorney General Michael Mukasey, in a speech to the American Bar Association, saying they were in violation of only Civil Service Laws, quote, "where there's evidence of criminal wrong doing, we vigorously investigate it. And where there is enough evidence to charge someone with a crime, we vigorously prosecute. But not every wrong or even every violation of the law is a crime."

Mukasey brought in by President Bush after Alberto Gonzales left, after his own human resources debacle, adding this to the list of investigative and punitive actions he has not taken. But he insisted, "as a general matter in such cases, where disciplinary referrals are appropriate, they are made."

As for the scandal at hand, "to put it in concrete terms, I doubt that anyone in this room would want to trade places with any of those people."

Time to call in Jonathan Turley, professor of constitutional law at George Washington University. John, thanks for your time tonight.

JONATHAN TURLEY, GEORGE WASHINGTON UNIVERSITY: Hi, Keith.

OLBERMANN: Well, why wouldn't I want to trade positions with Monica Goodling? I mean, she got to break the law and then hear today from the attorney general that she got away with it.

TURLEY: The attorney general would have had a lot more credibility if he actually prosecuted government officials on occasion. He said that he would not prosecute what is defined as a war crime in the case of torture. He would not prosecute on the electronic surveillance crimes. He has prevented investigation, where he says that he vigorously investigates. He has been standing in the way of investigations. And now he's sort of putting forth an Elmer Fud defense, that I'd be a lot better hunter if the varmints so fast.

He's just saying, you know, they got away, and what can I do about that? But the problem is that his records speak volumes about what his philosophy, if there is such a thing, is really about. And he is not prosecuting government officials. And I'm afraid he's doing it without principle.

OLBERMANN: And there's another whopper from the attorney general in here, buried under that no prosecution headline, talking about whether or not any of the Goodling hires would be reassigned, would be dismissed; "two wrongs don't make a right." That is a brilliant legal mind in action. I'm awe struck to watch that. Why didn't he say don't cry over spilled milk.

TURLEY: There's also that diddy of better late than never. And the thing is, I don't necessarily disagree with him in terms of the lying DOJ employees. I think it would be unfair to toss them all out, even though some of them may have credentials that were less than stellar than the people that were applying for the jobs.

But my concern is with the immigration judges. It's clear that the standards used to select those judges were not based on the merits and were often based on their political alliances and associations. Those are people rendering decisions over the lives of others. It seems to me rather cavalier to say, you know, that's just water under the bridge.

OLBERMANN: When Mukasey came in to succeed Alberto Gonzales, many people expressed hope. He was just too much of a jurist, his record suggested, to be another Bush hack. I'm sorry, if it wasn't official before, isn't it official today? Isn't he just another Bush hack?

TURLEY: I do think that Mukasey is an example of why it's so dangerous when senators like Senator Schumer and Senator Feinstein protected him from having to answer a questions on torture. I think that he shows the Senate that they have to demand answers to these questions. What he said at first was he didn't know what water-boarding was, which was not exactly credible. And then he said that he would have answer the question later, which he never did.

And I think it's not fair to call him a sycophant like Alberto Gonzalez, but he is a remarkable cynic. He seems to believe that he has the discretion not just to prosecute but to define what crimes are. No one's having trouble defining what torture is or the violation of electronic surveillance laws. Those were already defined by federal courts. But he is treating himself as the sole decision maker and the person who will define those crimes. And in so doing, he's making a wonderful argument for reinstating the Independent Counsel Act.

OLBERMANN: One more, while we have you, John, the Federal Appeals Court ruling today on the dismissal of the Wilson-Plame civil lawsuit against various key administration figures. It has been upheld. There is no lawsuit right now. Do you concur?

TURLEY: I don't agree with everything in that decision. I said it when it was filed that I thought it was unlikely that it would succeed. It was a bit of a stretch. But I felt that the court was wrong on critical points. By the way, the vice president lost a major issue when he claimed this was all a political question. And even Judge Cintell (ph), who's quite conservative, said that's just ridiculous.

I think the problem here, and it goes back to the Independent Counsel Act, is it shows that there is no independent basis to protect people like Plame. She was done wrong. And what happened to her was, in fact, at least for many people, certainly a violation of public policy. And even George Bush's closest aides have said that he broke his word, that he said that he would fire those responsible. And when they turned our - the facts turned out to incriminate both his vice president and his closest aid, he simply forgot about that promise.

It comes back to this; we have seen now, over and over again, the refusal of this administration to allow juries and grand juries to look at questions. And the question now is, do we need to interject an independent body like the independent council again.

OLBERMANN: Because we have cut down that safety net. Jonathan Turley of George Washington University, as always, John, great thanks.

TURLEY: Thanks, Keith.

OLBERMANN: One of those very special nights when the lives and the adherence to the White House talking points of Bill-O the clown are just too vast even to fit in worst persons. Special edition of fact or fiction. So worsts struggles on without him. Only Sean Hannity is left to carry the flag of Fixed Noise. That's next. This is Countdown.

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OLBERMANN: The question now is, Bill-O told his sheep last night about the sex scandal, who paid to hide these stories? Millions of dollars exchanged hands. That money must be accounted for. We know who pays your - oh, the John Edwards scandal, I thought you meant - my mistake. Another dramatic reading in fact or fiction next, but first time for Countdown's number two story, tonight's worst persons in the world.

The bronze to Denver's newspaper "The Rocky Mountain News," which posted an item online without attribution or a byline, which appears to have been cut and pasted from either a right wing blog or the Internet Movie Database. It claims Senator Obama holds, quote, both American and Kenyan, since 1963, citizenship. This is one of the most insidious of the online smears, because it is unaccompanied by a blood curdling scream. It's just an implication.

Sadly, for the far right, not only does the US State Department's website emphasize that Kenya does not recognize dual nationality, but the constitution of Kenya specifically prohibits dual citizenship. You can only have Kenyan citizenship if you renounce citizenship in any other country. You have to renounce it, or they will renounce you. The "Rocky Mountain News" fell for it.

Runner up, Sean Hannity of Fixed News. The fix this time is his fixation on Obama. Responding to the candidate's reference to a Fox Noise mistake about his Misses, Hannity said, "well Senator, here's a way to make sure these so-called falsehoods about your wife can get cleared up, sit right here next to me. Come on the program and you can set the record straight. Don't hide behind campaign hacks or surrogates, who feature talking points like trained parents. The leader of the free world, well, he shouldn't have to do that."

And he shouldn't have to sit next to some two bit talk show hack like Sean Hannity. In fact, no U.S. citizen without a criminal record should ever have to.

But our winners tonight, CEO Gerard J. Arpy (ph) and American Airlines, acknowledging today it is not just charging ordinary passengers for extra baggage, as in more than one piece of checked luggage. It is also charging U.S. troops, even the ones traveling towards the war zones. Two soldiers from Texas were recently charged 100 bucks and 300 bucks respectively for their extra duffel bags. Moreover, the airline has an entirely specious defense for the practice. It says it charges the soldiers less than it does ordinary passengers; plus, since the soldiers get all of their travel expenses reimbursed by the Army, it's really charging them nothing.

That sounds lovely, except the soldiers are the ones who still have to pay the extra 100 or 300 bucks out of their own pockets, and then file for reimbursement from the Pentagon. So you guys are asking our troops to file expense reports while they're getting shot at in Iraq, nice. American Airlines and Chairman Gerard J Arpy, nickel and diming the soldiers, today's worst persons in the world.

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OLBERMANN: Bill O'Reilly is the gift that keeps on giving and the bottomless mug of root beer and, for that matter, the bottomless pit. Narry a day passes without something being belched forth from the Frank Burns of news that can, depending on how you look at it, either extinguish your faith in mankind or leave you laughing at the saving moment when he lapses into self-satire, self-revelation, or that simple, beautiful, Side Show Bob like moment where, on the verge of the actual realization of his most heart-felt delusions of grandeur, he instead steps on the rake that he has invariably left directly in his own path.

Our number one story on the Countdown, fact or fiction big time. As Bill-O the Clown goes after John Edwards, he manages only to remind everyone about Andrew Mackris, while actually making us feel a little sorry for John Edwards. As ever, the words are his, the translation to human is mine.

"We had the mistress story last spring, but we chose not to air it because of the pain it would bring to Elizabeth Edwards, a brave woman and her three children."

This is the guy who in the days after nine children died in a horrific fire in New York City ignored the grief and ran instead a series of stories about how it happened because the parents might have been undocumented aliens. Their immigration status was so much more important to O'Reilly than their heart break that he almost got into an on-air fist fight with Geraldo Rivera over the story.

"What we did do was expose Edwards as a dishonest politician, a man who tried to exploit American military people to prop up his preposterous theory that the United States economy punishes the poor. Edwards ran around telling everybody that 200,000 vets were homeless because the economy was corrupt. Nonsense. The truth is the vast majority of American homeless, including vets, are either addicted or mentally ill."

In Bill-O land, if you are addicted or mentally ill, it doesn't matter if you got that way while you served this country; it's all your fault and the government should not spend Bill O'Reilly's money on you.

"What bull, Just so you know, about ten days ago, the Department of Housing and Urban Development issued a report saying there are 125,000 chronically homeless in America right now, 10,000 homeless veterans, 10,000. So Edwards was simply lying."

Actually Bill is lying, or too stupid to have read the entire HUD report, or both. But chronically homeless are such every day or nearly thus. Those who are frequently homeless, it says in the same HUD report, total about 1,600,000; 13 percent of them are veterans. That would be 208,000 homeless veterans. John Edwards was and is damned right about that. And Bill O'Reilly is a lying snake oil salesman. So did he pull that 10,000 homeless veterans figure out of his brains? No, He misread, intentionally or otherwise, a joint announcement from the Housing and Urban Development, and the Department of Veterans affairs that those two departments were committing 75 million dollars to getting permanent homes for 10,000 homeless veterans.

Bill-O didn't make the number up, he just lied about what the number meant. He is operating under a messiah delusion that he is a no good son of a - "Factor producer Porter Berry could not find one, not one resident who had anything good to say about Edwards. Most consider him a snob."

Porter Berry could Not find his backside with both hands and a GPS. and he's not a producer, he's a stalker producer.

"Then there were the 400 dollar hair cuts and his boycott of a presidential debate on Fox News, even though FNC had treated him very well over the years."

So you'll be doing the story on John McCain's 520 dollar Faragama (ph) loafers soon, and his campaign's threats to boycott the "New York Times" and "Newsweek" and other legitimate news organizations?

"There's no question the liberal media loved the message that Edwards was putting out there, that America is a place that caters to the rich and hammers the poor. That's why the committed left press ignored the "National Enquirer" investigation that proved to be true."

Remember when I mentioned that rake directly in his path? Here it comes.

"The question now is who paid to hide the story? Millions of dollars exchanged hands. That money must be accounted for."

Let's see, October 28, 2004, Associated Press: "Andrea Mackris, 33, was a producer on the show, filed a lawsuit against the top rated TV host October 13th, alleging O'Reilly made a series of explicit phone calls to her, advised her to use a vibrator and told her about his sexual fantasies involving her."

"The New York Daily News," citing unidentified sources, reported that O'Reilly had agreed to pay Mackris anywhere from two million to ten million. Separately, "the New York Post" said it was believed that O'Reilly paid multi-millions of dollars to settle the suit. Earlier that day, O'Reilly, 55 and married with two children, had filed a lawsuit accusing Mackris and her lawyer of trying to extort 60 million dollars in hush money to make the case quietly go away.

"The question now is who paid to hide the story? Millions of dollars exchanged hands. That money must be accounted for."

Project much, Bill? That's Countdown for this the 1,931st day since the declaration of mission accomplished in Iraq. I'm Keith Olbermann, good night and good luck.

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