'Countdown with Keith Olbermann' for Wednesday, Oct. 13th, 2010
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Guests: Richard Wolffe, Faiz Shakir, Chris Hayes, Sam Seder, Dave Weigel

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

The plot to buy America. "Think Progress" names names of foreign companies funneling money into our election, into pro-Republican campaign commercials via the U.S. Chamber of Commerce, at least $885,000 from dozens of firms, from Bahrain Petroleum to Hindustan Construction. And still, the Chamber of Commerce lies about it.

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BRUCE JOSTEN, U.S. CHAMBER OF COMMERCE: Fascinating to us, this begins with a liberal blog, "Think Progress," a subset of John Podesta, his own Center for American Progress, who interestingly was largely funded as a start-up by George Soros and doesn't divulge his own donors.

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OLBERMANN: Except "Think Progress" is not making campaign commercials. The Chamber of Commerce is.

The far right in bed with foreign interests seeking to elect those who would sell this nation out with Chris Hayes of "The Nation" and Faiz Shakir of "Think Progress."

The midterms: the president is not helping. TARP, the bailouts, the economic salvage job he had to do, he now says, "re-enforced the narrative that the Republicans wanted to promote anyway, which was Obama is not a different kind of Democrat, he's the same old tax-and-spend liberal Democrat."

And he thinks he might have better luck after the midterms working with Republicans if they win the House.

How about working with this Republican Tea Party House candidate from Michigan?

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UNIDENTIFIED MALE: Or unless Congress, in majority, will stand up - up to and including impeachment. And Republicans don't have the majority.

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OLBERMANN: How about working with the Ohio Republican in the Nazi get-up? And the guy who just defended him?

Carl Paladino, now, he has gay-bashed himself.

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CARL PALADINO (R), NY GUBERNATORIAL CANDIDATE: I don't want them to be brainwashed into thinking that homosexuality is an equally valid or successful option. It isn't.

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OLBERMANN: But it is if there's profit involved. Guess who rented one of his properties as a gay bar? Guess who tried to half-apologize to everybody? Guess who just got his endorsement hold up from under him by that rabbi?

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UNIDENTIFIED MALE: Did you see that Carl? What a guy.

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

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PALADINO: I am angry. That's OK.

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OLBERMANN: Good evening from New York. This is Wednesday, O 13th, 20 days until the 2010 midterm elections.

And there are in soldiers on the battlefield in the struggle not just over the next month's elections, but over the future of American democracy. They are underdogs to be certain, but in the battle against the big money threatening to swamp American democracy, they are trying something new.

But if you want to understand what they're trying to do and comprehend just what and who they're up against - first in our fifth story: the money coming from secret, right-wing millionaires against Democratic candidates around the country, and you ain't seen nothing yet.

Those groups, including Karl Rove's and Chamber of Commerce and others will air more than $200 million worth of TV ads funded by secret donors by the time Election Day arrives. That according to "Politico," quoting the nonprofit group Democracy 21. More than 60,000 such ads have already aired, according to a count by "Media Matters" - 4,700 of them just last week. And that was before Rove announced that he is increasing fundraising goals for his Crossroads groups to a total of $65 million so that he can now target House races instead of just the ones in the Senate.

And the Chamber of Commerce, President Tom Donohue yesterday told "The Associated Press" he's going to ramp up his campaign to elect right-wingers - ramp up from the $10 million spent just last week alone. And both Donohue and Rove's groups are part of a new right-wing alliance reported by "The Wall Street Journal," launching a $50 million ad blitz this week to buy a Republican majority in the House.

"The journal" quoting the Campaign Media Analysis Group, third-party Democratic groups are running ads in nine House campaigns. How many Republican House campaigns are getting answers from outside groups? Seventy - 7-0.

"Think Progress" today documented at least $885,000 in foreign money, going to the chamber from at least 84 foreign companies with agendas contrary to those of American business. But even beforehand, "Think Progress'" report on the existence of such funding prompted a flurry of desperate pushback from the right wing this week, including from the chamber itself, which ABC reports will not go on camera with mainstream media. Although, chamber vice president, Bruce Josten, who helped engineer the Bush tax cuts and the Cheney energy plan did appear on the network whose parent company this summer gave the chamber 1 million bucks.

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JOSTEN: This begins with a liberal blog, "Think Progress," a subset of John Podesta, the chair of the president's own transition team after inauguration, his own Center for American Progress who interestingly was largely funded as a start-up by George Soros and doesn't divulge its own donors.

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OLBERMANN: A familiar charge if you caught a certain FOX employee on TV that morning.

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KARL ROVE, FORMER BUSH AIDE: President Obama based his attack on a blog posting by "Think Progress," which is associated with the Center for American Progress, a group headed by John Podesta, who was the chairman of the president's transition. It is a political group and does not reveal its donors.

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OLBERMANN: They are, of course, correct. "Think Progress" and the Center for American Progress do not disclose their donors. Why? Because they don't run ads.

Still, some Republicans do want the chamber to disclose its foreign funding. Watch how passionate Republican Ron Johnson is, calling for disclosure during his debate with chamber target, Senator Russ Feingold of Wisconsin.

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SEN. RUSS FEINGOLD (D), WISCONSIN: You just said they ought to disclose. You haven't called on these people to disclose. You just said you're for disclosure. You won't even call on them to disclose.

RON JOHNSON (R), WISCONSIN SENATE CANDIDATE: I'd be happy to have them disclose.

FEINGOLD: Why don't you ask them to do?

JOHNSON: Disclose.

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OLBERMANN: Democrats have shown a little more energy on the issue. Senate Democratic whip Dick Durbin is calling on the IRS to investigate Crossroads for violating rules that require that its primary purpose not be political. Senior White House adviser David Axelrod telling "The Plum Line" blog, the White House will stay on the issue.

A new poll finding that 47 percent say they will be less likely to vote for a candidate if they learn that candidate 0was helped by ads paid for by secret business groups.

So, back to the start - who are the new players fighting against those secret businesses? The shareholders. Shareholders, for instance, are challenging their oil companies using millions of corporate funds to fight California's new emissions law.

And Rupert Murdoch's News Corp., FOX's parent, under fire from two investor groups, a progressive Jewish foundation calling for complete disclosure of his political spending before the annual shareholders meeting this Friday. F&C Investments, "Media Matters" reports now opposing the reelection at that meeting of News Corp. audit chairman, Sir Roderick Eddington, over the use of corporate funds for the political causes of individual board members.

Of course, this is all thanks to Citizens United, the ruling handed down by the Scalia wing of the Supreme Court, allowing billionaires to use assets of the companies they run to target Democrats. Unfortunately for shareholders, a new SEC rule that would have allowed them just to nominate their own board members has been put on hold, thanks to a lawsuit filed by the Chamber of Commerce, lead counsel on that case, Eugene Scalia.

Back with us on this issue again tonight, the editor-in-chief of "Think Progress," Faiz Shakir.

Good evening, sir.

FAIZ SHAKIR, THINKPROGRESS.ORG: Hi, Keith.

OLBERMANN: Before we go big picture. Explain, if you'd be so kind, the reporting behind the claim of 84 foreign companies kicking in $885,000 minimum to the Chamber of Commerce.

SHAKIR: Sure. You'd be following this as closely as I have. You know that the chamber's response since we released our report last week has been just "trust us, we've got a system in place." And what we've done is we don't really trust you, let's look at what you're saying.

And over the past week, the Chamber of Commerce has said we're getting $100,000 from AmChams, that's our foreign money. That's been the claim that they've told "The New York Times," "The Washington Post," "A.P., " and anybody who's listening, is that they only get $100,000 from AmChams.

And what we did in this report is we documented eight times as much, $800,000 coming from 84 companies. And the 84 companies is particularly important because just yesterday, Bruce Josten, who you mentioned in your clip, was telling FOX News that they only have 60 foreign-based corporations that give them money.

So, on two counts here, Keith, we know that they're not telling the full truth. And so, why trust them?

OLBERMANN: There's been some skepticism about whether or not anybody cares about this. Why the skepticism? And are they right about the not caring?

SHAKIR: Well, Keith, you know on both sides of the aisle, everybody's saying this election is about economy and jobs. There's somebody who's in favor of outsourcing jobs overseas and fighting for companies' tax loopholes that shift overseas. And that's the chamber.

There's somebody who's fighting against health care protections for Americans. That's the chamber.

There's somebody who's fighting against - or fighting for lowering the corporate tax loop holes or lowering the corporate taxes, increasing the amount of taxes for the rich. That's the chamber.

There's somebody who's fighting for taxpayer bailouts every time corporations spill oil in the Gulf, or whenever they screw up with the large financial crisis. That's the chamber.

Tell me that the chamber is not important in this election. I hope that people do what Russ Feingold did, is demand that the chamber disclose who their donors are. That's the critical issue here. We want to know what their agenda is.

OLBERMANN: And that new polling suggests nearly half the voters would vote against somebody, more likely to vote against somebody if they knew the money was coming from some secret source, as is the case with the chamber.

Your organization was invoked particularly by Mr. Johnson and Mr. Rove. Respond to them. Why does it matter if they disclose your donors but not if you disclose or don't disclose yours?

SHAKIR: Sure. The Center for American Progress of which I'm a part does not run political ads on television. The law stipulates that if you run ads on television, you must first adhere to the law that says you disclose your donors, and second, that the donors who give to you must abide by contribution limits. And what the chamber and particularly what Karl Rove certainly is trying to do is avoid that law and take in gobs of corporate money and in the chamber's case and in some cases foreign money to influence the elections. And that's what we think is skirting the law.

The Center for American Progress, we're not running those ads. They're running $75 million worth, $10.5 million just this week. That's more than the RNC.

I mean, these guys are major players and that's why the law should apply to what they're doing.

OLBERMANN: And the new P.S. to this, shareholders starting to reject the use of the money in this way by their corporations. And then the son of one of the Supreme Court justices who's working for a group funded by the very same rich guys we've been talking about gets a suit going that stops the shareholders in their tracks. That's just a coincidence, I assume.

SHAKIR: You know, after Citizens United, we learned that corporations are individuals. And now, we know that the individuals who lead these corporations are treating their corporations as individuals. Like the chamber is taking on the personality of Karl Rove. You know, we got the health insurance companies acting like John Boehner.

I think, at the end of the day, this isn't about accounting gimmicks. It's about who these companies are accountable to. Are they accountable in the shadows? Like nobody's going to pay attention to them? They can just do what they want in secret. Or are we going to force them out into the public and know what their agenda is?

And I would hope that if we keep the pressure up, we're going to learn who are these secret actors.

OLBERMANN: Including on Justice Scalia, who believes himself, a law and a Constitution unto himself.

Faiz Shakir, editor-in-chief of "Think Progress" - great thanks again for your time tonight.

SHAKIR: Thank you, Keith.

OLBERMANN: All right. Let's turn now to Chris Hayes, Washington editor of "The Nation."

Chris, good evening.

CHRIS HAYES, THE NATION: Good evening, Keith.

OLBERMANN: I want to ask a short-term version of this question and a long-term version of this question - short-term meaning this election season. Now what?

HAYES: Well, I think the "now what" as you try to make lemons into lemonade by essentially making this a campaign issue. That's clearly the strategy that a variety of people are pursuing. I mean, the White House picked this up for a reason. They think it's a winning issue. I think they're right. Move On has been pushing against this.

And it's one of those issues that's right on both - it's both the substance and also the politics. And if you're someone like Russ Feingold who is in a desperately tight, close, contested race in Wisconsin, and also has an amazing sort of reputation on behalf of disclosure, transparency, campaign finance reform, this issue is kind of a Godsend to sort of pursue against, because you're getting bombarded by essentially, you know, political sniper fire from pill boxes that you cannot identify. And this allows you to fight back.

So, I think in Feingold's case and another tight races, it could be a winning issue down the stretch. It's the best you can hope for.

OLBERMANN: All right. Long-term, the president called this a threat to our democracy. How do you stop it long-term?

HAYES: Long-term - I mean, look, this has been a long-term process that's brought us to where we are. I mean, you can think about the post-Watergate architecture of campaign finance reform is a kind of a Jenga tower, right, with those wooden blocks.

And what we've seen over the last two or three decades is pulling out piece by piece by piece. Citizens United was the last block that made the whole thing collapse. So, we're in a landscape now in which that architecture, that essentially, in a very incomplete fashion, attempted to provide some kind of discipline on this absolute total corruption of the democracy by sort of plutocratic interest. That's falling away now.

So, what we have to do is think from the ground up. One way is the Fair Elections Now bill, which has 150 co-sponsors in Congress and 25 in the Senate, would create a system of public elections, publicly funded elections, in which you would raise small donors and they would be matched by a public fund. There are state-level versions in Maine and Arizona.

You have to start thinking of the way that we're going to run this in totally new fashions because the old system is sort of beyond salvaging at this point.

OLBERMANN: But is that - are we past the point of no return on that? Is that even doable? Can that happen before the other alternative comes to pass, where the wealthy gain control of every single lever of power and then they just strip mine everybody of whatever assets might still be left and privatize the roads and the cops and charge you for air to breathe?

HAYES: Well, it does seem sometimes close to that, doesn't it?

OLBERMANN: Yes, it sure does.

HAYES: It seems like we're on the verge of it. I mean, I think that

I don't think we are. And the reason I don't think we are, what's potent and powerful here is that if you look to the polling of Citizens United, there's a deep kind of small "R" republican tradition that finds this notion of massive concentrated pools of corporate power being able to affect election outcomes without transparency and disclosure. It finds an anathema to the basic foundational Republican spirit of the country.

And I think what you saw was - across party lines, across the ideological spectrum - a revulsion at the Citizens United decision, a revulsion in the face of disclosures about the chamber's sources of funding. And I think that - capturing that spirit and channeling it into organized effective political action is a possibility because that sentiment is so deeply held by the electorate.

OLBERMANN: But, of course, you've got the massive corporate pools beginning to run the anti-corporate political action and calling it things like the Tea Party.

HAYES: Yes. Exactly. And I think the most hilarious thing here, right, is that here you have, you know, the Tea Party. You ask - if you talk to people at these rallies and stuff, you know, the biggest thing they'll say, the first thing they'll say is the bailouts. I mean, they hate the bailouts, right?

That - what happened between the first House vote, in which the TARP was defeated in the second House vote when TARP passed was that the Chamber of Commerce went well of the House and it called up its member, and it basically said, look, you better vote the right way on this. I mean, the chamber was hugely instrumental - hugely instrumental - in getting TARP passed. It was perhaps the most instrumental voice of the financial services roundtable as well.

And now, here's the chamber with its TARP agenda and the Tea Party together funding the same candidates.

OLBERMANN: Chris Hayes of "The Nation" - as always, greatest thanks, Chris.

HAYES: Thank you, Keith.

OLBERMANN: If you heard a great hissing sound around the nation today, it was some of the air being let out of progressives. The president speculates Republicans might be more responsible were they to win the House. Through a spokesman he's now clarified to us his earlier comments about legitimate criticisms about the bailouts.

Meantime, one Republican candidate is showing how he would work with President Obama. He's threatening to blackmail him with impeachment.

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OLBERMANN: While the president muses that he can work with the Republicans, even after a disastrous set of midterm elections, they muse they could blackmail him by threatening impeachment.

The big surprise for the Fat Tony lookalike running for governor of New York. He tries to walk back some of the gay-bashing he did at the behest of a Brooklyn rabbi and the rabbi withdraws his endorsement.

She's going to teach everybody about the Constitution. No, the U.S.

Constitution.

And a would-be Ohio congressman dresses up like a Nazi to celebrate the military accomplishments of a Panzer division. And guess who defends him? That's right. Everybody deserves to be called a Nazi, except the guy actually wearing the Nazi uniform.

Ahead on Countdown.

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OLBERMANN: In a remarkable new interview with "The New York Times,"

the president talks about his next two years in office, working with

Republicans, imagining they will work with him, even if they win control of

the Congress on a wave of anti-Obama sentiment. We'll explore that notion

presently

But in our fourth story: we begin with what Mr. Obama has had to say about his first two years in office and what that says about those who have supported him.

One of the president's spokesmen insists in a statement to us that the president is not backing off what he did and did not deem criticism legitimate.

In his interview, the president does in one instance acknowledge the merits of argument from the left that he should not have moved to the right until it was part of a compromise, rather than before, specifically on the stimulus package, about 1/3 of which was composed of tax cuts, quote, "It might have been better for us not to include tax cuts in the original package, let the Republicans insist on the tax cuts and then say, 'OK, you know, we'll compromise and giving you your tax cuts."

But in what sounds like an endorsement of last year's anti-health care town halls and a slap against those who argued for him to do more. He said his critics were legitimately troubled by his agenda.

And to quote, "Just one thing after another having to do one thing -

$800 billion here, $100 billion there, a $700 billion TARP program that wasn't started by me, but the Republicans definitely sort of denied authorship of, and was managed by us and is going to end up costing us $100 billion or less, which is probably the smallest cost to taxpayers of any financial crisis, including the S&L bailout. Despite all that, that accumulation of numbers on the TV screen, night in and night out in those first six months, I think deeply and legitimately troubled people. They started feeling like, gosh, here we are tightening our belts, we're cutting out restaurants, we're cutting out our gym membership, in some case, we're not buying new clothes for the kids, and here we've got these folks in Washington who just seem to be printing money and spending it like nobody's business, and it reinforced the narrative that the Republicans wanted to promote anyway, which was Obama is not a different kind of Democrat - he's the same old tax-and-spend liberal Democrat."

And in what would appear to be a major challenge to the rationale for electing any kind of Democrat next month, Mr. Obama seems to suggest that he has little if anything in the way of legislation to pursue that would make it important to elect Democrats who support him. First, he says he thinks issues like education have potential for bipartisan cooperation because, quote, "they're less ideologically divisive."

But the second thing that happens, he says, quote, "is that we've got to focus on implementation. I mean, I didn't pass a law just to have a feather in my cap. I passed a law so that it was actually helping people. So, there's going to be a lot of work in this administration just doing things right and making sure that new laws are stood up in the ways they're intended."

Let's turn to MSNBC political analyst Richard Wolffe, the author of the upcoming book, "Revival: The Struggle for Survival Inside the Obama White House."

Richard, good evening.

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

OLBERMANN: I mentioned the statement I got this afternoon about the Baker interview from Bill Burton, the deputy press secretary. Let me quote Bill in full here.

"The president is, of course, proud that he made the right policy decisions that helped put our economy on a better course and saved the financial sector. I wouldn't overread what he is considering as legitimate. He's simply saying that folks who only see headlines with big price tags might well be concerned about all the spending that's happening in Washington. But he is by no means backing off what he did."

Even granting that, is there not the potential for de-energizing the base included in much of that interview with Peter Baker?

WOLFFE: Yes. Of course there is. I mean, I - you take Burton at his word here. I'm sure the president stands by what he did. But you don't engage in this kind of navel-gazing for a piece that's going to come out three weeks or less before an election like this.

This is the kind of reflection you want to do after an election, once you know the result, once you know where the Republicans are headed, who you're going to have to negotiate with. But putting it out there seems to legitimatize it. He, as president, is trying to say, yes, I understand what people are feeling and thinking.

But it's a campaign. This isn't a sort of third party analyses. He's the central figure in this election. And I cannot for the life of me understand why the White House would want to engage with this kind of article at this point.

But full credit to Peter Baker because it's a great read.

OLBERMANN: And the second part of the political question: Why announce less than three weeks before an election that you can work with the Republicans while your party is campaigning, in some cases, frantically, against those Republicans as obstructionists, that they're not going to go along with you anyway and then to add you don't have much that you need a new Congress to pass anyway?

WOLFFE: Well, I guess you get some marks for honesty if you're in the White House, because they do think that with governing, if the Republicans do, in fact, take over the House, come some responsibility, different kinds of pressures. But again, this is the kind of musing that you can indulge in once you know the actual result, because you're still campaigning, thinking there's a shot that Nancy Pelosi can remain as speaker.

So, those kind of tactical adjustments, it seems to me the same kind of mistake the president was talking about with tax cuts in the stimulus, the same kind of mistake they made when it came to oil drilling ahead of getting the package on energy and climate change. If you negotiate by giving up everything first and then saying, come to the table, you may look honorable. But that's not a strong negotiating position.

OLBERMANN: In the rest of the article, Richard, White House aides are shown as saying that the problem was that they did not communicate good policy well. President Obama says the economic numbers were the problem.

Is there anybody in the White House who thinks maybe if the policy had been different, the economic numbers might have been better? That these are really two issues that they're only each seeing half of?

WOLFFE: Well, of course, they're not mutually exclusive here. There are plenty of people in the White House who say we wanted more stimulus, we did what we could. We just squeaked this through with a few votes. And that's all we could do.

I do think this comes down to - in the end - look, the jobs come out of what corporations are willing to spend their money on, why they're sitting on these big piles of cash right now. That's the critical question.

But that doesn't absolve the White House of failing to come up with a way of talking about the $800 billion that it spent. And at the moment, they would rather talk about the other side, that's fine as a tactic.

But they still need to be able to talk about their own record. They need to say how they spent the money, how they saved teachers and their jobs, how they saved people from falling off the edge of the cliff. They're not doing that. They're simply saying, well, gee, you know, we didn't quite get jobs where we wanted it to be and we're all frustrated. That's not a message to march under.

OLBERMANN: Lastly and briefly, there's a suggestion here by Mr. Baker in this piece that Mr. Obama's presidential bubble in terms of - I guess the number of aides he talked to. It might be smaller than George Bush's was.

Is that your experience? Can you expand on that?

WOLFFE: Well, what's the optimal size of the bubble here?

(LAUGHTER)

OLBERMANN: None.

WOLFFE: You know, exactly. You want a president who can get information from a wide range of sources. This president has a close inner circle. I think it's very hard for outside journalists, even outside politicians to try and penetrate it.

But we don't actually know who he's talking to. And I think the president likes it that way. Was President Bush, for all the people he could draw on from his father's administration, from everyone in the Republican establishment, was he better informed about the situation in Iraq? What matters is the quality of the information, the questions they're asking. Not the size of the bubble.

OLBERMANN: MSNBC political analyst Richard Wolffe - great thanks again for your time tonight.

WOLFFE: Thank you, Keith.

OLBERMANN: The Republicans' implicit promise gets a little bit more explicit about that president. If they get the House, they start threatening impeachment - next.

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OLBERMANN: It has been hinted at the fringes, about everything from the threat presented by the five-member new Black Panther Party, to the, quote, "BP shakedown," unquote. The rationale may still be borderline psychotic, but the latest source is borderline mainstream, a former Republican congressman seeking reelection now in Michigan.

Our third story, impeachment as blackmail, against the backdrop of a president saying he's optimistic about working with Republicans after the midterms. This is also from that lengthy interview with Peter Baker of the "New York Times," quote, "it may be that regardless of what happens after this election, they feel more responsible, either because they didn't do as well as they anticipated" - the Republicans he's speaking of - "and so the strategy of just saying no to everything and sitting on the sidelines and throwing bombs didn't work for them. Or they did reasonably well, in which case the American people are going to be looking to them to offer serious proposals and work with me in a serious way."

The president was then asked if there were any Republicans he trusted enough to work with on economic issues. Turns out there are two. The first, retiring Senator Judd Gregg of New Hampshire. Even though when Mr. Gregg was literally given the opportunity to work with the president as economic issues as commerce secretary, he declined to do so just days after saying he would.

The second, according to the president, Congressman Paul Ryan of Wisconsin. Mr. Obama labeling him as "someone who is absolutely sincere about wanting to reduce the deficit." Even though Mr. Ryan has been highly critical of President Obama's own budget proposal.

But on the bright side, Mr. Ryan has not been out there talking up impeachment, yet. That's left to the Tea Party candidate out of the Michigan seventh. Former Republican Congressman Tim Walberg going full Birther at a recent campaign event, saying he takes the president at his word that he's an American citizen, but just to make sure, the president ought to show his birth certificate to persons of responsibility. And also, a radio demagogue.

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TIM WALBERG, CANDIDATE FOR CONGRESS IN MICHIGAN: If I were going to do it, I'd call - I'd call Rush Limbaugh, Allen Colmes, Nancy Pelosi, Mitch McConnell, and maybe one justice of the U.S. Supreme Court. Call them all into the room and lay out my - my birth certificate on the table. And maybe it's for personal reasons, I don't want it to be shown to the media or whatever else. But say now, all of you take a look at it. Tell me what you find. Now go and report it.

(END VIDEO CLIP)

OLBERMANN: Allan Colmes? And if the president doesn't agree to that sensible plan?

(BEGIN VIDEO CLIP)

WALBERG: The executive has an awful lot of power to keep from showing certain things unless the courts will stand up to him, or unless Congress in majority will stand, up to and including impeachment.

UNIDENTIFIED MALE: Right.

WALBERG: And the Republicans don't have the majority.

(END VIDEO CLIP)

OLBERMANN: But the promise of impeachment is not exclusive to Birthers. It doesn't matter which so-called scandal you choose. Congressman Darrell Issa, eyeing the chairmanship on Oversight, called a potential White House job offered to Congressman Joe Sestak an impeachable offense. Tea Party queen Michele Bachmann backed up the right's claim that Mr. Obama is declining to secure the country's southern border for political gain. "Whether to not this is an impeachable offense is one that the Congress would have to make a determination on."

Joining me now, political satirist, co-author of the book "FUBAR, America's Right Wing Nightmare," Sam Seder. Good to see you, Sam.

SAM SEDER, AUTHOR, "FUBAR": Nice to see you, Keith.

OLBERMANN: So the message coming from the Republican party at this point is what? We will attempt to impeach the president if we have the power to do so? We just haven't come up with a correct cover story yet.

SEDER: Right. We're going to need two years to hold some investigations. We've got to do the committee on the birth certificate. We got to look into what Michelle Obama ate in Spain, maybe. We got to break open this controversy as to whether or not Hawaii is actually a state. Like Hawaii's a state-gate, or something like that maybe.

Yes. Is Bo the dog involved with Acorn? They're going to have take two years of hearings on this before they can bring it to impeachment. But I think that is the game plan. If Obama wins a second term, that's what the Republicans can be expected to do.

OLBERMANN: But - why is the president expecting to cooperate with these lunatics?

SEDER: That quote that you read was one of the most stunning things I think I've ever read Obama having said. There's absolutely no logic to it whatsoever. And I've been wracking my brain to think is this some type of strategy? And I can't see what it is.

Unless he's trying to send some type of message to like David Brooks or David Broder or somebody, or somebody inside the Beltway - you think you would just call them up and tell them this. Why are you saying this in public? It makes no sense whatsoever.

Where were you during the '90s? It really is stunning. And I - for the life of me, I can't figure it out.

OLBERMANN: And what is also complicating the inability that we both have to figure this out is this seems so different. Whoever this is in the interview does not seem like the man who has been recently energized, fired up, and firing people up on the campaign trail. What about that dichotomy?

SEDER: You know, you were talking to Richard Wolffe. You said it well. I can't understand why you would do this before the election. I mean, on some level, it's as if he's waving the white flag at this point. And it makes no sense.

I mean, he clearly gets energized when he's on the campaign trail. It's funny, I was watching that rally he had in Wisconsin, which was very reminiscent of 2008. In fact, maybe more people, I think, in Madison this time around. But when he says change, the difference is that in 2008 I thought I knew what he meant. Now I'm just like - well, get a little more specific this time, please.

OLBERMANN: Do you have any sense of this contributing to, or is it already passed a tipping point in terms of deflation and deenergization 20 minutes - 20 days before the midterms? It feels like 20 minutes.

SEDER: You know, I don't know how many people are actually going to

read this interview. And frankly, look, it's the House. I mean, do people

I actually think that we're going to see - if we see GOP control of the House, we're going to see a series of these investigations. And do people want to sit through that?

I mean, I think at this point, look, the Democratic base is going to go out and vote. The rest of the people I think who are, you know, in this supposed middle, who are less - who want Washington to be somehow fixed, as if that was actually something that could be done or relevant - I don't think they're going to pay much attention to it.

OLBERMANN: Washington, as we noted in the first segment of the show, is fixed. That was called Citizens United.

SEDER: Exactly.

OLBERMANN: We have that already. That's the one thing that's resolved.

SEDER: Well, the bottom line is people want results. And the idea that you can go in and be so process-oriented and worry about how Washington works, as opposed to what the results the people in the country want - and the fact is we're a polarized country. So it's either we're going to maintain Social Security, or in some way we're going to basically let everything just burn.

And I - you know, I don't understand why he keeps focusing on this process argument.

OLBERMANN: Sam Seder of SamSeder.com, author of "FUBAR." Good to see you. And thanks for coming in.

SEDER: See you, Keith.

OLBERMANN: Gay bashing; Carl Paladino, his rental income from a gay bar revealed, tries to back down from his hate speech, only to get hated in return by the Brooklyn rabbi to whom he was pandering in the first place. And gay bashing in the Arizona governor's race, courtesy of the campaign of Jan "headless torso" Brewer.

(COMMERCIAL BREAK)

OLBERMANN: The miracle happy meal of Manhattan coming up in Worst Persons. First, the sanity report And the Tweet of the day from Governor Rick Perry of Texas, celebrating his state's baseball team's victory last night to move on to face the New York Yankees in the American League Championship Series.

"Way to go Rangers. What should we wager Giuliani for the series?" How about wagering you don't know Giuliani's been out of office since 2001, governor? Let's play Oddball.

We begin in Okinawa. Thousands of people came out to see which side of the town was stronger; 656-foot, 42-ton rope was placed in the middle of their main road. The atmosphere was tense, like when Liston fought Clay and no one was sure what would happen.

Once the starting gong was hit, the tugging began. Immediately, the pent up anger between neighbors came pouring out. Unfortunately, the two sides proved to be equals. The rope barely moved. The battle ended in a tie. So I guess they'll have to settle this the old-fashioned way, by making obnoxious comments about how shoddy their neighbor's yard looks.

To the Internets, where some unlucky car is in the process of getting towed. I'm not an expert on the process of towing cars, but I feel as if this gentleman may have skipped a step. Hello. The car continues to roll until it's stopped by nature's speed bump, that tree. The tow truck driver was OK, but he might want to think twice before trying to tow David Blaine's car again.

Finally on to the frozen ponds of St. Louis, where the Ducks of Anaheim are squaring off against the St. Louis Blues. Suddenly, a rare fight breaks out in hockey. George Paros (ph) and Barrett Jackman (ph), huge Jackman. It all seems like the regular hockey tough talk. My mullet is fuller than your mullet, that sort of thing. Until you take a closer look. Is he flicking him? Is that really a flick right there? Bing.

Beware the next time these two come in contact on the ice. A tickle fight may break out.

Time marches on.

Carl Paladino thinks it's immoral to go to a gay pride parade. To rent one of his properties as a gay bar? That's fine. Well, there's a profit there. See?

Ohio Tea Party Congressional candidate Rich Iott running around in the Nazi uniform praising the military brilliance of the Panzer divisions, he has a defender. Any guesses?

And when Rachel joins you at the top of the hour, she'll talk to two Air Force majors about the judge's ruling on Don't Ask, Don't Tell. They will appear thusly in silhouette because they have not yet been permitted to stop lying.

(COMMERCIAL BREAK)

OLBERMANN: So those disgusting grown men grinding against each other at the gay pride parade, making it look like a strip club? Turns out Carl Paladino's real complaint was, he wasn't making any money off of it. He was the landlord at a gay bar. That's next, but first get out your pitchforks and torches, time for tonight's Worst Persons in the World.

The bronze to McDonald's. They deny this, but New York artist Sally Davies (ph) decided to do a little experiment. She bought a happy meal and left it out uncovered in her kitchen. She said other than the fact that the burgers and the fries had become hard as rock, nothing about it has decayed. No smell of any kind, not after the first 24 hours. No mold, even though she began her experiment last April.

Our runner-up, just as stale, Congresswoman Michele Bachmann, poised for her own run to become the first brain-free speaker of the House. Whether or not she makes it, she intends to become teacher of the House. "As part of the Tea Party Caucus, I'm going to be starting classes on a weekly basis for our new members of Congress on the Constitution. And I'm asking experts from around the country to come in every week and teach our Constitutional principles."

U.S. Constitution? No offense, professor, but shouldn't you have considered teaching the U.S. Constitution to the Tea Partiers before they ran for office? Not after?

But our winner, televangelist Glenn Beck. You recall that Ohio Tea Party Congressional candidate Rich Iott admitted that for years he was part of a group called Viking that reenacted the various campaigns of a German World War II Panzer division, complete with the Nazi uniforms, and the tributes to the Germans' brilliant military success, and the praise for how such a small country could wind up taking over Europe. And, you know, conducting genocide and murdering intellectuals and stuff.

It's so bad, even Republican Whip Eric Cantor finally condemned Iott. who could possibly defend him?

(BEGIN VIDEO CLIP)

GLENN BECK, FOX NEWS ANCHOR: Now if you are doing this with your son, I could see how this might be fun. If you happen to have a Nazi uniform in your closet and you're like wearing it and you're like, yes, I'm wearing my Nazi uniform around, you might question somebody.

But if you are part of an reenactment group and you are war gaming, I could see that as - again, not something I necessarily would participate in, but nothing wrong with it.

UNIDENTIFIED MALE: No.

BECK: There's nothing wrong with it.

(END VIDEO CLIP)

OLBERMANN: So if you keep your Nazi uniform in your closet and you're like wearing it, that's a problem. But if you're like Rich Iott, and you keep your Nazi uniform and you're like wearing it and actually reenacting great Nazi military triumphs, there's nothing wrong with that.

I mean, you and I both recognize there's not one single thread of logic going through any of that. But why would Lonesome Rhodes say something like that?

Oh, yeah, that's why he would say that, because he played dress-up too. Televangelist Glenn Beck, today's Worst Person in the World.

(COMMERCIAL BREAK)

OLBERMANN: It is a standard call from the tried and true Republican playbook; if your candidate is behind or your lead is shrinking, a little gay-baiting can help push you across the finish line. it worked for the Bush administration. It may have worked in a primary for Christine O'Donnell. And in our number one story, it may or may not work for Jan Brewer in Arizona and Carl Paladino in New York, but it won't be for lack of trying.

Sunday in Brooklyn, Paladino earned the endorsement from the orthodox Rabbi Yehuda Levin after professing to the rabbi's congregation that children should not be, quote, "brainwashed into thinking that homosexuality is an equally valid and successful lifestyle." The remarks received bipartisan condemnation from Democratic opponent Andrew Cuomo, from Rudy Giuliani, from the last Republican governor of New York, George Pataki. Even Paladino's own family wasn't happy.

His nephew/campaign staffer, Jeff Hannen (ph), who happens to be openly gay saying he was, quote, "highly offended" by his uncle's remarks. Yesterday, Paladino apologized for, quote, "any comment that may have offended."

Before the apology, Paladino's people were kind enough to inform the rabbi of the upcoming mea culpa. The campaign cited the candidate's nephew as the reason. Today the rabbi publicly withdrew his endorsement. He told the "New York Post," quote, "Mazel tov. We'll have a coming out party. When he came to me three days ago, he didn't know that? I find this to be condescending."

Wait until he finds out about the gay bars. Monday, the would be governor complained about grown men grinding against each other at a gay pride parade, which looked to him, he said, like a strip club. Today, the "New York Daily News" reports that Paladino has in the past rented space to gay establishments in Buffalo, Buddies II and Cobalt, which was at one time run by Paladino's son.

And according to the "New York Daily News," quote, a March 2005 review of Cobalt in the "Buffalo News" described it as "way gay," noting the queens, the techno, the cocktails, the kind of gyration normally confined to Manhattan was in full flaming force at Cobalt," unquote. You know, like a strip club, which must have been OK by Carl because the checks cleared.

Let's turn to "Slate" political reporter, MSNBC contributor Dave Weigel. Dave, good evening.

DAVE WEIGEL, "SLATE": Good evening, Keith.

OLBERMANN: Paladino's anti-gay social conservatism getting in the way of the sort of fiscal conservative message. He angered Giuliani, Pataki, his nephew. Now the rabbi broke away. Even profitable landlords are ticked off. Where does he turn to now?

WEIGEL: I don't know who he can turn to. I mean, he's going to find a new performance art, a new creativity outlet. I'd suggest finger painting or maybe World War II reenactment. But he doesn't - this campaign is sort of a one off. We talk a lot about Tea Party candidates. This campaign has sort of taken all the gaffes of all the other candidates and super sized them in a way that's really fascinating to cover, because so much media's in New York watching the guy flounder.

But really this stuff is unrecoverable from. He made this mistake in the first place because he chose that rabbi as kind of a Sherpa to the Jewish community. But that was obviously ham handed. That wasn't a block of voters he was going to have a lot of appeal to. And that wasn't the way to do it.

So, no, we hate to predict the election being over, but this is one race that Democrats are kind of tucking away as they look at the rest of the map.

OLBERMANN: I have to say, I agree with all your points there. I just have to bring attention to the phrase we can create out of what you said there. A ham-handed Sherpa rabbi. That's poetic. That's as beautiful as the tie.

To some degree, it does uphold a maxim, though, that at least half of all politicians who bash anything fervently turn out to have some connection to the thing which they're trying to keep from the public. And Paladino had two, family and financial.

Is the assumption here that he just thought nobody would ever know? Is that at the essence of these - the faux pas that have been sprinkled across the Tea Party campaigns? Because they're not really experienced politicians, they think nobody's ever going to find out about the stuff in their past unless they want them to?

WEIGEL: That's actually a good point. With him specifically, he's done a couple of other projection games with Andrew Cuomo's campaign. He has fathered a child out of wedlock. He's raised a child. Fine, live and let live. But the way he first responded to that was by insinuating, with no evidence, that Cuomo had - I think the word he kept using was legendary prowess, and then just letting that sit out there.

So he has - again, there are a few candidates this bad on the ballot in November, but he has just tried to do this kind of insinuation in a very obvious way. Other Tea Party candidate who have the same amount of experience as him have been less bad at this. They've sought - they haven't warred with the party establishment as much as he has because he won a very late primary.

They took it over early. They got the right consultants. And they hid from the national media, which you can't do if you're in New York.

OLBERMANN: But you can show up late and still get into the party. The Brewer campaign in Arizona - her campaign manager suggested that the Democrats supposedly in the race who is straight should take a lie detector test prove it. The campaign manager today apologized. Brewer said she didn't say that, so she doesn't have to. the race tightened. Is there anything else? Is there enough time left for some of the Tea Partiers who are ahead to screw it up?

WEIGEL: Well, there - no, there is. We keep saying the election is jobs, jobs, jobs. But what elections actually are about are what kind of crazy story can explode in the last week. And in Arizona, I'm not sure if it's enough for the Democrats to do that. Because the proper and effective Brewer pander has been on immigration. She went from a non-entity who was going to lose her own primary to a superstar because she signed the 1070, the immigration law.

So I - I think they need to get their pander straight here. They need to get their scapegoats. This was just a huge blunder by the campaign manager. No, other Tea Party candidates are going to make these mistakes. It is not clear that Democrats can capitalize them. They're going to win a couple races they shouldn't because of it, though.

OLBERMANN: When headless torsos work, stick to headless torsos. Dave Weigel of "Slate," great thanks, Dave.

WEIGEL: Thank you.

OLBERMANN: That's October 13th. I'm Keith Olbermann, good night and good luck.

And now to discuss the Don't Ask, Don't Tell ruling with two men directly affected by the worldwide stop on enforcement, ladies and gentlemen, here is Rachel Maddow. Good evening, Rachel.

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