'Countdown with Keith Olbermann' for Wednesday, January 27th, 2010 - 8pm
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Video via MSNBC: Quick Comment (Breitbart), Quick Comment (Obama critics), Worst Persons
Via YouTube: Quick Comment (Breitbart), Quick Comment (Obama critics)

Guests: David Shuster, John Dean, Richard Wolffe, Howard Fineman, Eugene Robinson

(BEGIN VIDEOTAPE)

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

The breaking news: One of the, quote, "telephone repairmen" in Senator Landrieu's office, Joseph Basel, had been the campaign manager for a successful Republican state senate candidate. Authorities are not dismissing this as a prank.

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UNIDENTIFIED MALE: We don't take any incident lightly when it comes to attempts to penetrate our security.

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OLBERMANN: Running for cover, with Basel identified as an ex-Republican campaign manager, with O'Keefe to have keynoted the GOP's Salt Lake fundraiser next week, the Republican mainstream and the tea parties which O'Keefe addressed and which Basel belonged, try to bury their connections; while those media godfathers try to forget its pledge (ph).

The scandal day two, with David Shuster in New Orleans; Richard Wolffe in Washington on the prospect of congressional investigation; and John Dean in Los Angeles on the Republican dirty tricks recruitment machine.

Sarah Palin, quote, "Republican in name only," attacked by the right for endorsing - John McCain? It's perfect.

State of the Union.

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UNIDENTIFIED REPORTER: Mr. President, what's your message on health care tonight?

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: It's a good one.

(END VIDEO CLIP)

OLBERMANN: Howard Fineman on a president under a microscope; Gene Robinson on a Congress 84 percent of Americans believe is too influenced by special interests; Chris Matthews and Rachel Maddow on whether the nation wants freezes and compromises.

And the "Quick Comment" that what we need is this.

(BEGIN AUDIO CLIP)

FRANKLIN D. ROOSEVELT, FMR. U.S. PRESIDENT: Government by organized money is just as dangerous as government by organized mob.

(END AUDIO CLIP)

OLBERMANN: All the news and commentary - now on Countdown.

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OLBERMANN: Good evening from New York.

The infiltration of U.S. government facilities in New Orleans and the attempt to somehow alter the office phone system of a sitting U.S. senator was not, it turns out, just the work of one right-wing, quote, "journalist," unquote, but, in fact, four right-wing men, who are not pranksters on the conservative fringe, but rather recruits of, mainstays of, and the prospective future of the right-wing's bedrock institutions.

And we know more today about the operation inside the office of Louisiana Democratic senator, Mary Landrieu - as law enforcement officials tell NBC News the federal government believes the defendants were not trying to intercept or tap phone calls, but believed that Senator Landrieu's office was unresponsive to calls from critics of health care reform and wanted to document whether her office responded to a total shutdown of its phones by laughing it off or expressing some sort of concern about constituents being unable to reach them.

Entering under false pretenses to cut off the senator's phones - wiretap or not - is, guess what, also a crime, punishable by up to 10 years in prison.

Defendant James O'Keefe has already admitted to taping the events and new reports from unnamed officials today said one of the two bogus phone repairmen wore a tiny hidden camera rigged into his hard hat.

Co-defendant James Dai arrested in a car down the street had what sources had reportedly described as a listening device. But the defendants are not random pranksters from outside the right-wing mainstream. As we learn more about their backgrounds, it turns they are, in fact, cultivated, nurtured products of the same Republican establishment now desperately trying to disown them tonight.

O'Keefe, we already knew, posted videos of what he used to describe as pranks and then began to call journalism on the website of the conservative Drudge protege Andrew Breitbart. Breitbart now admitting O'Keefe was on his payroll on salary while denying any acknowledge of this latest event.

O'Keefe is a favored GOP speaker, including to at least one tea party rally in St. Louis. And as recently as 2006 and 2007, he was on another right-wing payroll, working as a campus recruiter for the right-wing training facility, the Leadership Institute, which says on its Web site, quote, "The Leadership Institute does not analyze policy, it trains conservatives how to win."

Led by longtime conservative activist Morton Blackwell, the institute's campus group, Campus Reform, interviewed both O'Keefe and co-defendant Joseph Basel, past recipient of the Leadership Institute seed money on the 14th of this month, and wrote, quote, "To protect their ongoing investigations, we can't say exactly when or when the interview was conducted."

Basel, another party mainstay, attended the Bush 2005 inauguration, is a Facebook fan of the Tea Party Patriots, and managed the successful 2006 campaign of now-State Senator Bill Ingrebrigtsen, Republican of Minnesota.

Co-defendant Robert Flanagan, son of an acting U.S. attorney, was a paid employee of the right-wing Pelican Institute, about a block away from Landrieu's office, which had O'Keefe as a speaker, did the institute, just last week.

Last year, Flanagan interned for Republican Congresswoman Mary Fallin of Oklahoma, cosponsor of a recent GOP resolution honoring O'Keefe.

Mr. Dai has equally impressive connections in the Republican Party, claiming to have been operations officer of a Pentagon counterterrorism program during the Bush presidency. Recipient of a $5,000 grant from the Phillips Foundation, started by Robert Novak, and kept going by a right-wing publisher Alfred Regnery; and a former undergraduate fellow on terrorism at the Foundation for the Defense of the Democracies. Its leadership council: Newt Gingrich, Robert McFarland, Joe Lieberman, Bill Kristol - you get the idea.

Reporting on this story for MSNBC tonight, David Shuster, who, of course, anchors our dayside coverage at 10:00 a.m. and 3:00 p.m. each weekday and is back on his old beat, scandal watch tonight in New Orleans.

David, good evening.

DAVID SHUSTER, MSNBC CORRESPONDENT: Good evening, Keith.

OLBERMANN: Based on today's reporting, should we not expect further charges then? Are the outlines of the crimes complete in the prosecutor's mind at this point?

SHUSTER: Well, Keith, a couple of things. First of all, there is a grand jury that is available to the prosecutor should the prosecutor develop new information. However, this does not appear to be shaping up as any sort of a wiretap case. Instead, all of the information, of course, is that it's a federal trespassing case.

There are strong indications that each of the witnesses, each of the people who are in this criminal complaint, Keith, have started talking and that prosecutors will simply try to corroborate their stories, make sure that they're all essentially telling the same stories, but also try to determine, Keith, whether or not there was a particular ringleader. Was there any incentive, for example, that James O'Keefe gave to his colleagues to participate in this?

And there's always the possibility, as prosecutors will say, Keith, that there can be a superseding indictment, that you can bring additional charges based on the information that is developed. And that in the course of perhaps trying to reach a plea deal, that if somebody becomes a government witness, they could have their charges reduced.

OLBERMANN: Let's get into the weeds of this a little bit. The listening device that Stan Dai allegedly had according to the "Associated Press" last night, if that - if that's not a wiretapping attempt, is there another explanation for what that phrase "listening device" means?

SHUSTER: Yes, Keith. Sources familiar with the case are suggesting that this was some sort of walkie talkie, maybe even a cell phone that Dai had in that van and that he was in communication with O'Keefe, who was upstairs on the 10th floor of that building behind me. It's not clear whether or not Stan Dai had the ability to either record on this cell phone or just walkie talkie, but rather, that he was in communication with the people upstairs.

Again, the description of this as a listening device, that was from a law enforcement source and it may have been a little bit misleading. There is every indication that the people upstairs on the 10th floor were communicating with the guy, Stan Dai, who was down in the truck. But again, it looks like it's a simple explanation as some sort of walkie talkie, perhaps even a cell phone with a walkie talkie device connected to it.

OLBERMANN: It does beg the question of what he's doing down there.

But I'm sure they've already raised that one.

Something in the language of that January 14th piece from the Leadership Institute's campus group, suggests they knew O'Keefe and Basel were up to something. O'Keefe was on Breitbart's payroll for written work, exclusively. Does this investigation need to expand? Does it seem likely to? Are prosecutors looking into the backgrounds, as everybody else seems to be, of the four men involved?

SHUSTER: Well, they will. I mean, I spoke to Andrew Breitbart today, who said flat-out that the last time he spoke with James O'Keefe was several weeks ago and he had no earthly idea that James O'Keefe was up to this.

But, again, that's something for the prosecutors to determine. I mean, prosecutors will tell you that they have to essentially figure out, was there any financial incentive? With all the people that had financial connections to James O'Keefe, did they give him any incentive? If O'Keefe tells prosecutors, "Look, I did this completely on my own," there's a due diligence that prosecutors have to follow to make sure, so you can expect that Andrew Breitbart and some of the rest will eventually get calls from investigators, and there may be - it may be absolutely true that they had nothing to do with this.

But the prosecutors are going to follow this. They're not just going to take the word of James O'Keefe and the rest. They're going to try to make sure that the funding here, that you can explain that how this came about.

OLBERMANN: It's too bad there isn't videotape of what actually went on there - oh, yes, there is, isn't there?

MSNBC's David Shuster, who airs weekdays at 10:00 and 3:00 on the network - great thanks for your reporting tonight from New Orleans.

SHUSTER: Thanks, Keith.

OLBERMANN: With us tonight, another echo of Watergate here. He's the former White House counsel for President Nixon, author of "Blind Ambition," John Dean.

John, welcome back. Good to talk to you again.

JOHN DEAN, FMR. NIXON COUNSEL: Thank you, Keith.

OLBERMANN: So, is this a prank, is it a caper, or is it a third-rate burglary?

DEAN: Well, it's certainly not a prank. It's pretty serious. I think it happened - from what I can piece together - it looked like more of a continuation of O'Keefe's entrapment journalism that he was working on.

It's pretty nasty stuff. It's something they're trying to get people to say things they shouldn't or find situation where they can record them and then embarrass them and hurt them in some way. And it's pretty mean-spirited stuff that they've gone beyond what is legal to try to accomplish.

OLBERMANN: It must be, however, as mean-spirited stuff goes, it may -

it must sound awfully familiar to you, because the training school quality to the backgrounds of these guys, their roots. Has not the college Republican machine been turning out people like James O'Keefe for a lot longer than James O'Keefe has been alive?

DEAN: Well, indeed, it has. I think Karl Rove was one of the early tutors that went around campuses to instruct people on how to do these sorts of things. How far Karl went as to the mechanics, I don't know. But that's certainly legendary on the right, that this sort of activity is acceptable.

And also, the fact that O'Keefe's work has been so applauded by his elders, if you will, has been nothing but encouragement for this kind of activity.

OLBERMANN: Is this not, to some degree, reminiscent of Donald Segretti and that whole crowd from the campuses of the mid-'60s?

DEAN: Keith, I can't believe the stupidity of it all. You know, we've been there, done that, people have realized the mistakes that were made. It really is stupid that they would do this sort of thing or try to continue to do these kinds of things at this late stage. You think we would evolve in our political intelligence at some point.

OLBERMANN: Well, we can both wait.

Explain - something legal for this, and with your firsthand experience on this so many years ago, particularly, how can - how can this be - can this be a conspiracy without being a directed conspiracy. In other words, you wind these guys up in college, in internships, in this, you know, of this plethora of different training, hothouses, and then you give them a certain mindset and you, what, you just let them run loose on their own devices?

DEAN: Well, you know, the fact of - a conspiracy in the law is when two or more people agree to undertake illegal act and one person takes an overt step to further that agreement.

Clearly, this is a classic criminal conspiracy with these guys and what they did. How far back it reaches, and who all the co-conspirators are, we don't know yet. If this is something that happened where somebody else in their like-thinking crowd said, why don't you do something like such and so, they could well be pulled into the conspiracy. That's one of the things I think the investigators are going to be looking at and try to resolve, because this may be more than four people.

OLBERMANN: Are we correct to suggest that these guys are not outliers, away from the Republican mainstream, but they are more representative of the mindset, the tactics, and maybe the ethics of the people running the party and the institutions that nurtured these guys?

DEAN: Well, I'd certainly say that's true, given the endorsement of the kinds of activities in the past, when they've engaged in this sort of thing, where they illegally recorded people at ACORN, the kinds of telephone calls they've recorded to embarrass people. They've used this before.

So, I think this has been embraced by the Republican right and those who, indeed, control the party today. I think that they are clearly trying to distance themselves now, but they encouraged it.

OLBERMANN: John Dean, Nixon White House counsel, author of "Conservatives Without Conscious" - as always, great thanks. And who ever knew we'd be talking about something this specific to your background. Thanks, John.

DEAN: Thank you, Keith.

OLBERMANN: The possible absence of more does not mean there is not enough. If the Louisiana senator in question had been named Vitter, the demands for a congressional investigation might drown out the State of the Union address tonight. Will the Senate inquire in defense of the security of one of its Democratic members? And where is this going politically?

"Quick Comment" and Richard Wolffe - next.

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OLBERMANN: Now, some of the far-right reaction to the explosion of the phone-gate scandal in tonight's first "Quick Comment."

Mainstream media leaping to conclusions while big government, his Web site, waits for facts. This is a new policy for the writer Andrew Breitbart. You're applying it to Major Hasan and Abdulmutallab and everybody else detained in Gitmo or just for your own employees?

What he does for the site exclusively is he tells his life rights, basically, so when he puts a story out there, it's on the Breitbart sites, he's paid a fair salary. What Mr. Breitbart is trying to hide there is that the ACORN story involved at worst a minor government contractor willing to misappropriate money to some kids just back from the Halloween party still dressed as Superfly.

This is already four charged federal felony crimes against the United States government with a confession with its victim, a U.S. senator. And at its center is a man paid a salary by Mr. Breitbart to recount all his adventures, who might be offered a way out of years in jail if he turns on, say, some hypothetical person who paid him.

It's like throwing the light on in the kitchen and watching the cockroaches scatter. But one of them is struck to the floor, Andrew Breitbart.

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OLBERMANN: After James O'Keefe and his actual co-conspirators were arrested, O'Keefe's virtual cohorts quickly figured out a way to deal with this. So now, the pimp-impersonating conservative cavalier who was hailed as a hero has suddenly turned into the right-wing media equivalent of - who that? As exemplified from the most visible microphone of Mr. O'Keefe's body of work, FOX News.

That red bar here represents how much time FOX News spent on O'Keefe's ACORN video on September 10th, 2009 when it was first released.

The little tiny blue blip over on the right shows how much time FOX News devoted to O'Keefe's arrest last night - a grand total of four hours and 35 seconds over six hours of programming.

Meantime, the 34 Republican congressmen and women who supported a resolution to honor O'Keefe for his ACORN video, they are mostly saying nothing.

But one of them, Congressman Joe Pitts of Pennsylvania, has reacted through a spokesman. Quote, "The congressman doesn't know him."

Meanwhile, a cosponsor of the resolution, Congressman Pete Olson of Texas, would not say whether the resolution would now be withdrawn and his pro forma statement on the matter begins with, "Individuals who lawfully expose wrongful activities by an entity like ACORN should be praised." The statement then added that, "if any recent events conclude that any laws were broken, that is not something I condone."

And besides the reaction of Andrew Breitbart already noted, other commentators are dealing with O'Keefe, dealing what they can for now by remarking that nothing justifies breaking the law while also trying to portray the event as simply another videographer gone wild, another sting gone wrong.

But the Salt Lake City Republican group has reacted to the mug shot version of O'Keefe by canceling O'Keefe's appearance as its keynote speaker next week for this year's Lincoln Day dinner fund-raiser on the 4th of February.

For the political implications of this, let's turn now to our own Richard Wolffe, the author of "Renegade."

Richard, good evening.

RICHARD WOLFFE, MSNBC POLITICAL ANALYST: Good evening, Keith.

OLBERMANN: Obviously, State of the Union night, this is not the front burner in Washington, but where does it stand? Are the prospects that Congress wants to look into this, specifically the Senate, because this is about, after all, a senator's security, no matter which party she belongs to?

WOLFFE: Well, I highly doubt the Senate will get into this kind of thing and not least because it's a question of law enforcement. This is an alleged federal felony and while it's in the hands of law enforcement, really Congress needs to step aside and keep out of it. Yes, there could be a policy issue about the security of senator's offices, if they really want to take it that far, but there is an important principle here.

And in a way, Congressman Olson's statement kind of picks up on this. What ACORN is supposed to have done is what he describes as wrongful. What these guys are alleged to have done is actually illegal. And when it comes to matters of legality, really, law enforcement, in this case, the FBI, are the right people to deal with it.

OLBERMANN: Regardless of that, if this, in fact, had been David Vitter's office, would there not be a Republican shouting about starting an investigation during the State of the Union in the next hour or so?

WOLFFE: Well, it is hard to predict what some people are going to shout as abuse to a president. Hopefully, they won't shout anything out, but let's deal with how that came about for an instance. Because it is, actually, related to this story.

You know, the kinds of misinformation of distorted facts that get their way into a congressman's hands, like question of illegal immigrants being covered by the president's health care plan, that is precisely the channel we're seeing with this ACORN material that O'Keefe mined and Andrew Breitbart used so effectively.

Members of Congress, Democrats and Republicans, need to be careful about the sourcing of their own information. And just because it's new media and it seems fun and new technology and raw and energetic, doesn't mean to say it's true and definitely should not be elevated to a congressman's agenda. And it certainly, in any case, shouldn't be used as a form of abuse.

OLBERMANN: This revelation that Mr. Basel was a Republican campaign manager in a state race in Minnesota and was on the Facebook page for one of the tea parties. O'Keefe spoke at one of the tea party rallies. Are these guys ultimately going to resonate in those circles as aberrations, as poster children, or is it going to be "O'Keefe - O'Keefe who?"

WOLFFE: Yes, I suspect those people are not going to walk away from this guy's work when it comes to ACORN and they may well still celebrate him. That's exactly the opportunity, though, there is for Democrats to exploit the difference between respectable Republicans and the tea party folks who want to praise and wants to go after this kind of agenda that O'Keefe represents.

You know, they need to actually, as Democrats, say, where are you going to stand here? Look at those 31 Republicans who went for this congressional resolution and say, where do you stand on the truth, on facts, and whether you stand with O'Keefe? Because you've got to separate out what is fringy and Internet-driven and what is still a respectable mainstream party in the Republicans.

OLBERMANN: And what do they do? I mean, those 31 members include Steve King. So, there's absolutely no predicting there. But what do the other 30 do? Do they - do they wait to see how this turns out? Because one would assume, unless there are guilty pleas quickly, this is going to drag on for some time?

WOLFFE: Well, I'm sure they're just going to try to keep their heads down and not talk about it. But that's no reason for Democrats to leave it alone and say, well, are you going to carry on with this resolution?

This is a congressional resolution. It's not just, you know, a Christmas card list here. So, you know, that - this is an election year. Republicans would not hesitate to try and drive this on. I don't recall them being quiet when it came to CBS and a story about a certain former president.

OLBERMANN: See if the Democrats can do the same. Richard Wolffe of MSNBC, author of "Renegade" - as always, great things.

WOLFFE: Thank you, Keith.

OLBERMANN: As we count down to the State of the Union, one person who might be thanking James O'Keefe tonight is Sarah Palin. You probably haven't heard this because of the confluence of phone-gate and the State of the Union, but the far, far-right and the tea partiers have just turned on Sister Sarah - next.

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OLBERMANN: The State of the Union, a president gets another chance to make a first impression - coming up.

But first, tonight's "Worst Persons in the World" with some actual breaking news in it.

The bronze to our buddies at CNN. Politico.com writes of their latest new prime-time show, that's the 10th new one since Countdown started. Quote, "Networks sources say that King's show could be aired squarely at the political junkie niche, those viewers determined to know who's up and who's down in Washington each night. That's speculation - of something like a political "SportsCenter" - was likely fueled when word got around that executives had reached out to a producer with experience at ESPN, said sources."

I mean, it's a while ago, but "SportsCenter," seriously? And our prime-time vice president here was there for seven years and we have a consultant from there. Maybe you'd like to try a political "Wheel of Fortune" instead.

The runner-up, Bill Shine, the vice president of fix news. This is a great try, defending his network's swing and a miss on Haiti, by attacking the other networks for covering Haiti, telling the "L.A. Times," quote, "Look, what happened in Haiti was just horrific, but there are also some big stories in America that we chose not to ignore the way that other networks seemed to."

Oh, like, the in-depth coverage of the anti-Obama Facebook page out of Indonesia, so you could run these graphics with Obama, the Indonesia flag, and country shape, and the word "home coming." And this one about taking down a statue, tearing him limb from limb.

Or that other big story in America that you didn't ignore, the rest of your own Chris Wallace-anointed power player of the week, James "Superfly" O'Keefe.

But our winners: Glenn Beck, Michelle Malkin, the blogs: Red County and Reality Check, and Paul Streitz, founder of Draft Sarah 2012. They have attacked the wonderful Sister Sarah. Malkin: "Tea party activists are rightly outraged." Red County: "Her political waterloo, supporting an enemy to the tea party movement and by de facto, becomes the enemy."

Streitz: "What should this be called, the Rinoization of Sarah Palin."

Beck: "I want to have another sit-down with her."

What did she do? What did Rino Sarah Palin do? Snubbed tea party-wannabe J.B. Hayworth and instead endorsed the senator of Arizona, John McCain.

One more quote from Reality Check, "Palin has proven that she is for sale."

Reality Check purports to be a Christian Web site and says Sister Sarah is for sale. Leave Sarah alone! Glenn Beck, Michelle Malkin, the blogs Red County and Reality Check, today's worst persons in the world.

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OLBERMANN: "I am not the first president to take up this cause, but I am determined to be the last." President Obama's determination to enact health care reform legislation seeming to have dwindled considerably since he made that declaration to a joint session of Congress just four months ago. On that night in September, the president's entire address devoted to making his case for health care reform.

But heading in tonight's State of the Union, Mr. Obama and his advisers were still debating whether he would even call for a scaled down version of the bill that was supposed to have been the centerpiece of his domestic agenda, or more likely just to fold it into the big tent topic of the economy. Advisers indicating the president will say it is not time to walk away from health care reform, yet the bulk of the president's remarks seeming to do the walking for it.

The Associated Press reporting roughly two-thirds to be devoted to the economy. Another large chunk to foreign policy and security issues. His goal, again, according to the AP, to show a dissatisfied nation that he understands their frustration and struggles, and that his agenda is in touch with the things they need. Forty five million Americans currently without and needing health care insurance.

At the White House today, when asked what his message to the nation will be about health care, the president saying only, "it's a good one." And in an excerpt of his remarks, released just minutes ago, the president had this to say about health care reform - this is what he will say during the speech. "By the time I'm finished speaking tonight, more Americans will have lost their health insurance. Millions will lose it this year. Our deficit will grow. Premiums will go up. Co-pays will go up. Patients will be denied the care they need. Small business owners will continue to drop coverage altogether. I will not walk away from these Americans and neither should the people in this chamber."

On that note, let's turn to our own Howard Fineman, senior Washington correspondent for "Newsweek" magazine. Howard, good evening.

HOWARD FINEMAN, "NEWSWEEK": Hi, Keith.

OLBERMANN: Health care reform is not the headline. It's part of the big two-thirds of the time economic message. What message is the president sending to Democratic lawmakers already retreating on health care reform by simply that apportionment of time tonight?

FINEMAN: Well, having been at a briefing this morning, a background briefing on this, and reading the excerpts and talking to people in the White House and on the Hill, it's clear that while he's telling them that they shouldn't walk away, and giving a very good explanation for why, he's basically saying, you know, if you do, there might be nothing we can do about it.

I do think that they want to make the argument at the White House that there's still both substantial benefit and political benefit in trying to do insurance reform. The stuff about preexisting conditions and making sure people aren't dropped from coverage and so forth, that they can score political points on that with the Republicans, entice the Republicans into supporting those things, that that's both substantively and politically a good idea.

But I'm not sure the president's going to really press that in the remarks tonight. I'll be listening to see if he does.

OLBERMANN: As we see the speaker having arrived. We say it in football, yelling stop as they run right past you rarely gets them to stop. But the president has spent so much of the first year saying rising health care costs are a threat to the economy. It's not like it's some new invention that he's just come up. And it was one of the touchstones of the joint address in September. So how does a health care-light agenda translate into one that's suddenly going to create jobs and fix the economy?

FINEMAN: Well, it doesn't. But they sort of gave up on or didn't win the argument about the notion that health care reform, as it was eventually devised in Congress, would actually save a lot of money. In other words, the original idea was you could sweepingly reform health care, cover everybody and save money at the same time by rationalizing the system. They never won that argument. And the fact that it's not going to be made tonight, in a speech where he's going to talk a lot about deficit reduction, shows that they've given up on that argument, at least for now.

OLBERMANN: The White House Press Secretary Mr. Gibbs said today, in several different venues, that the president will accept responsibility for not delivering on some of his messages. He's not going to accept blame, per se. This is verbatim an old David Frie (ph) joke that he delivered as Richard Nixon. The whole thing was, those who are to blame lose their jobs, those who are responsible do not. How do you split this hair?

FINEMAN: Well, I actually think David Axelrod, who's the senior adviser and who I've known ever since he was a political reporter, and a very good one at the "Chicago Tribune" in the early 1980s, who knows how to construct a narrative, who knows about salesmanship and politics, because he's been a media adviser for 25 years, I think does deserve some of the blame, and I think he'll take some of the blame.

Rahm Emanuel, the chief of staff, deserves some of the blame for the basic strategy of turning health care over to Congress. It reminds me of that scene in "Apollo 13" when they bring in all those parts and dump them on the table and say, make something out of this. Only failure was an option, unfortunately, for them.

OLBERMANN: "Apollo 13" got back safely.

FINEMAN: Exactly.

OLBERMANN: One thing that must be noted, as we see the vice president come in, we saw Mr. Engel got his front row seat for the 23rd consecutive year. They're going to address Don't Ask Don't Tell?

FINEMAN: That's a nod culturally in the direction of the base of the Democratic party and the grassroots and the net roots that got Barack Obama's campaign going to begin with. But that's just a political nod that's not really going to help them with the - America as a whole, in a speech that's supposed to be about jobs.

OLBERMANN: Howard Fineman of "Newsweek" and MSNBC, we'll talk to you again on the late-night live Countdown, about 10:30 eastern. Be back by then, if you would.

FINEMAN: I will, Keith.

OLBERMANN: Thank you. As the House chamber fills, we saw Senator Bunting there for a moment, as the vice president goes to the podium. Once again, a suggested role model for this president tonight in a quick comment, next.

(COMMERCIAL BREAK)

OLBERMANN: Literally, within the last minute, the president and the First Lady leaving the White House for the motorcade to Capitol Hill for tonight's, his first, State of the Union Address. As we look at that, now the second of tonight's quick comments.

There is doubt among those who elected him that this president has proved the leadership requisite to regaining control of this country. From the banks, from the insurers, from the corporations, and given to the people.

There should also be no doubt that this president is capable of that leadership. Others have been, in times bleaker still, with fewer weapons at hand. "Powerful influences strive today to restore that kind of government with its doctrine that that government is best, which is most indifferent." So said Franklin D. Roosevelt on the 31st of October, 1936, as he sought a second term against those who would freeze government spending and comfort the banks, while letting the people founder.

Change begins with saying aloud that which is wrong, saying it loudly and clearly, challenging those who would defend the wrong. The rest of it is best heard as Mr. Roosevelt said it, just three blocks from here.

(BEGIN VIDEO CLIP)

FRANKLIN D. ROOSEVELT, FMR. PRESIDENT OF THE UNITED STATES: We had to struggle with the old enemies of peace: business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering. They had begun to consider the government of the United States as a mere appendage to their own affairs.

And we know now that government by organized money is just as dangerous as government by organized mob. Never before, in all our history, have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me. And I welcome their hatred.

(END VIDEO CLIP)

OLBERMANN: And there, Mr. President, is your template. Welcome their hatred. Seize the mood of this nation, identical tonight to what it was in 1936, nearly, as Mr. Roosevelt perfectly captured it. "Government by organized money is just as dangerous as government by organized mob." And aspire also to what he added. "I should like to have it said of my first administration that in it the forces of selfishness and of lust for power met their match."

(COMMERCIAL BREAK)

OLBERMANN: The last time the president addressed the joint session of Congress in September, a House Republican interrupting him to call him a liar. This is how far that party and political decorum have fallen in this country. The headline repeated around the country today via the Associated Press: "Congressman Joe Wilson promises he will not interrupt the president this time." Gee, thanks.

Greg Sargent's blog, "the Plum Line," reporting House Republican leadership, in fact, held a private meeting this morning directing the rank and file to avoid any outbursts tonight, encouraging them to provide the president their respect. For his part, Mr. Wilson telling the AP he'll been on his best behavior, because, after all, he claims to be a, quote, gentleman.

Perhaps he'll be able to restrain his political Tourette's because so many headlines, like spending freezes, minimizing health care reform, are not something the Republicans can really object to.

But the latest numbers from the NBC News/"Wall Street Journal" poll suggest the president himself is in a kind of post-partisan bubble, and everyone else isn't, with more public support from the GOP or his own party. Only 27 percent blaming the president for the country's problems;

48 blame the Republicans.

More people saying they will use their vote in the midterm elections to send a signal of support for Mr. Obama than as a signal of opposition. The public's disdain for Congress reaching further; 93 percent saying there's too much partisan fighting, and 84 percent believing special interests have too much influence over legislation. Sixty one percent said that both Congressional Democrats and Republicans are not willing to compromise.

Joining me now, the associate editor, Pulitzer Prize-winning columnist of "The Washington Post," MSNBC political analyst Eugene Robinson, as we see the motorcade arriving at the Capital. Gene, good evening.

EUGENE ROBINSON, "THE WASHINGTON POST": Good to be here, Keith.

OLBERMANN: A lot of those poll questions can be easily dismissed as, you know, Republicans think there are Democratic special interests that control the whole thing, and Democrats believe Republicans are responsible for the bickering. But there is a trend there. And I think the big trend about people's assessment of congress begs the question, with whom is the president going to compromise tonight and why?

ROBINSON: That's a good question. If you take the poll numbers at face value, the president should, you know, say a pox on this entire house, and he should tell him to pay attention to what he wants to do rather than what they might want to do, and certainly to stop the bickering.

I do think that finding that people don't blame him for what they see as the excessive partisanship in Washington is really significant. And it gives him a continuing opportunity to take control or take back control of the message, of the dialogue, and move it forward in a progressive direction, what I would hope would be a progressive direction.

OLBERMANN: Even if it's not moving it forward, and just keeping it where it is, what is it? What is going on here? What does the White House see that we do not? Or are they seeing something that doesn't really exist?

ROBINSON: Well, I think one thing the White House sees is the disgust that so many people have about the partisanship, about the bickering. And I believe one of the reasons that only 27 percent of Americans, according to a poll, blame Obama is that they have seen him reach out, again and again and again, to the Republicans.

So, as a matter of theatrics, I think it's good politics. My question is, as a matter of policy - at some point, if health care is as important as the president says it is, as I believe it is, at some point, you've got to get it done. At some point, you have to say, OK, process be damned, but we have to get it done. My question is, when does he reach that point? But as theatrics, I think it is good politics.

OLBERMANN: And as we know, the people at home are not looking at this and saying, this is the State of the Union tonight; that's entirely different from the last time he was there in September. That was not a State of the Union, therefore you can't compare the two speeches. People at home say, this was a speech in the exact same setting that was 100 percent about health care. Tonight's might be, generously, 10 percent about health care. Did Joe Wilson win?

ROBINSON: I don't think you could say that Joe Wilson won. And I actually don't think it's necessarily going to matter a lot whether he devotes five percent of the speech to health care or three percent or 13 percent or whatever. I think what's more important is not how much he says, but what he says. Does he give a clear indication that he really wants Congress to proceed, or does he - or is it more like mush? Is it like, well, maybe we can do a partial this or a partial that.

So I think clarity will be more important than how many words there are.

OLBERMANN: All right. We're talking within the confines of what we think we know is going to happen. What would your -

ROBINSON: Exactly. And we don't know.

OLBERMANN: What would your blank slate advice be to this president at this point relative to this speech?

ROBINSON: You know, my advice would be that 27 percent number, that is a good number in this political atmosphere. You can regain control of the dialogue, and you can move ahead.

And people like you. People want you to succeed. And you can take that to the bank, basically. You've weathered the storm in that sense. So move ahead on your agenda, with talk about jobs, because people want to hear about jobs, but in the context of why your agenda is good for jobs.

OLBERMANN: You're good enough; you're smart enough; and dog gone it, people like you. It would be fitting in this setting with the new senator.

ROBINSON: The Stewart Smally (ph) State of the Union Address.

OLBERMANN: Yes. Eugene Robinson of "The Washington Post" and MSNBC, always a pleasure. Thank you, sir.

ROBINSON: Great to be here.

OLBERMANN: I have just suggested that a president who might talk past congress, past the media, directly to the people tonight, tell them what they want to hear or address it at least. What is it we want to hear? What is it - I hate this word - the Zeitgeist. Rachel Maddow, Chris Matthews and the State of the Union next on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: We are within eight minutes of the scheduled starting time of the president's State of the Union Address. I wouldn't make book on that. The president's motorcade has arrived at the Capitol. He is in the holding room now, with Valerie Jarrett and David Axelrod. You see the House chamber filling to capacity. Every year, of course, a small group of lawmakers treating like this like the opening of the "Star Wars" movie, or the line for the new Apple tablet, the inelegantly named iPad, staking out aisle seats more than 13 hours in advance, to ensure the good photo op during the president's walk out.

My friend, Congressman Engel of New York, has not missed a good seat since Reagan's last full year, and his streak is in tact tonight. This is the president's third address to Congress, technically his first State of the Union Address. Eleven months ago, he first addressed a joint session. At that time, there was still one Republican senator from Pennsylvania and Ted Kennedy, who devoted his 50 years of life in public service to passing health care reform, was still the senior senator from Massachusetts.

By the time of the president's second address to Congress, health care reform was the sole item on the agenda. Tonight, the president is expected to make it a part of his larger treatment of the economy and the jobs. And as we wait for the Supreme Court to file in, joining me now is the host of "Hardball," Chris Matthews. Good evening, Chris.

CHRIS MATTHEWS, MSNBC ANCHOR: Good evening, Keith.

OLBERMANN: All right. One of your White House lunch mates, Katie Couric, Tweeted today, just - off the record, "just had lunch with the president, who seems pensive, slightly deflated, realistic, aggravated, and resolute. Didn't eat his pie." I think I can reveal that when I was at the lunch in the White House in October, the president did not eat his cobbler. You were with the president today. What is the meaning of his skipping dessert?

MATTHEWS: Well, I don't know. It's off the record. I don't even care about this stuff. Look, it's important - I wrote in my notes there today, this is important. He is going to try to regain the traction, as we call it in politics, of this country's politics. And he's going to try to do it tonight by putting his foot on the pedal on jobs.

He is going to press the Congress to pass a big-time jobs bill. He's going to do it again. It's going to cost higher deficits, but he's going to do it. And I think that's going to be they headline in tomorrow's papers. That's the headline.

The second headline is he's going to try to find Republicans to join him on health care. He failed before. He's going to try it again.

Third, he's going to push for an end to the Don't Ask, Don't Tell concept over at the Pentagon. He's going to ask for free open service by people who are gay in the military. So those are the three things that I can tell you, coming out of the lunch today.

OLBERMANN: The First Lady has arrived. Will there be big themes, big words? I mean, you heard that Roosevelt clip I played earlier from 1936, anything like that? Is this the time for speech?

MATTHEWS: Keith, you make me think - and I loved Roosevelt in '36, and he spoke at Franklin Field and gave that great speech. And I have to tell you, that one in Madison Square Garden you quoted from is equally wonderful.

The times have changed in two regards. They may change again. One is really important. Hoover was in office under the Republicans for four years and proved to every single American that the Great Depression was Republican doing. It was totally their fault. Nobody could walk away. So by the time it was 1936, you had 70 Democratic senators, on the way to 76 Democratic senators. One party had taken the complete responsibility for the Great Depression. The other part was clean handed. And that's why the president could be that divisive effectively.

The second thing is - and this is one of the great ironies of the life you and I lead and have benefited from. The Democrats, through the Great Society, through the New Deal, through the New Frontier, created a middle class, through student loans, through social security, through job production. Everything that they did was to create a middle class. And now we have one. We didn't have a middle class in '36. We had working poor people and a few very rich. If you wanted to start a fight, you definitely started a fight the way Roosevelt did.

Today, if you try to talk like Roosevelt, you'll find the slightly better than middle class people saying, my god, he's coming for my money to pay for the people slightly below middle class. And I'm telling you, that's the problem. The Democrats benefit - I'm sorry, they suffer from what they gave to the American people, which is a middle class. And you can't rabble rouse with a middle class in this country or they will get spooked.

OLBERMANN: But if there is any consensus in this country at this moment, if there is - I hate the word Zeitgeist. But if there is one, it is people versus big fill in the blank, big corporations, big insurers, big government.

MATTHEWS: I'm with you on that one.

OLBERMANN: Is there a way to grab that?

MATTHEWS: I would get rid of Geithner. I think he represents, in his dress and his manner - and it's not his fault, perhaps. But he looks like Wall Street. Unfortunately, the people around the president in the economic area seem like Wall Street. He doesn't look like he's adversarial enough. I don't mean yelling at them. I mean fighting with them over policy.

I do think he suffers from the AIG bailout even now. I think he suffers from who benefited from that bailout, Goldman Sachs. I agree with you. But, you know, you deal with who you got. We don't have an angry president. We have a president who sees the other side.

He's not you, Keith. You can demand that he be you. And maybe you should change parties and dance here. But I've got to tell you, it's not the role he feels comfortable playing. It's obvious looking at him.

OLBERMANN: No, I love my country. I wouldn't wish that on -

MATTHEWS: I wouldn't either, honestly. But anyway -

OLBERMANN: Stand by a second. As the speech approaches, a few housekeeping notes here. Chris and Rachel will be with me for the night for analysis here. Then after the speech, we'll be bringing you the Republican response in its entirety. That will be followed by a special late edition of Countdown around 10:30. Among my guests, White House senior adviser David Axelrod and Congressman Anthony Weiner. That will be followed by a live edition of "THE RACHEL MADDOW SHOW", beginning at about 11:30.

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