'Countdown with Keith Olbermann' for Tuesday, December 7th, 2010
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Special Comment:
Obama turned his back on his base
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Guests: Ezra Klein, Howard Fineman, Rep. Bobby Scott, Karen Finney

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

The president gets angry - at his side.

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BARACK OBAMA, PRESIDENT OF THE UNITED STATES: To my Democratic friends, what I would suggest is: let's make sure that we understand this is a long game. It is not a short game. Take a tally, look at what I promised during the campaign. There's not a single thing that I've said that I would do that I have not either done or tried to do.

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OLBERMANN: And Democrats and independents are not buying it.

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SEN. BERNIE SANDERS (I), VERMONT: I will do whatever I can to see that 60 votes are not acquired to pass this piece of legislation.

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OLBERMANN: And from outgoing House Majority Leader Hoyer: "Giving tax cuts to high-income Americans is not appropriate."

But, evidently this was a hostage situation.

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OBAMA: In this case, the hostage was the American people. And I was not willing to see them get harmed.

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OLBERMANN: The details with Ezra Klein, the politics with Howard Fineman, the capitulation in tonight's "Special Comment."

The money we don't have to pay tax cuts that the rich don't need - we have to get it from China and Saudi Arabia and where else? Only the government still won't tell us. The speaker of the House speaks.

And the death reported tonight of one of the great people of our time, Elizabeth Edwards, who 19 months ago told me how she had gotten back up after the kind of grief we now feel about her loss.

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ELIZABETH EDWARDS, JOHN EDWARDS' WIFE: You start to be more productive, and you don't live with eternal discontent the day you say, now my life is different, and these are the new parameters of my life. And I have - every time I've resisted, and every time I've come to the same place.

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

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OLBERMANN: Good evening from New York. This is Tuesday, December 7th, 700 days until the 2012 presidential election.

The president today irritated, almost defiant, shouted back at his critics - nearly all of them on his side.

In a mid-afternoon news conference, he acknowledged that going into the bargaining on the issue of tax cuts for the rich, the public had been on his side. Quoting, "We weren't operating from a position of political weakness with respect to public opinion."

But the president said he did not have the votes in the Senate to get what he really wanted and the Republicans, he said, would not budge on what he was a month ago calling tax cuts for millionaires and billionaires.

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OBAMA: I've said before that I felt that the middle-class tax cuts were being held hostage to the high-end tax cuts. I think it's tempting not to negotiate with hostage-takers, unless the hostage gets harmed. In this case, the hostage was the American people. And I was not willing to see them get harmed.

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OLBERMANN: The president said a fight might have been good politics but bad for the economy. But according to "The Washington Post," a White House political strategy to win back independent voters facilitated this deal. More on that in a moment.

As for whether the deal represents a template for the president's fighting spirit or a lack thereof -

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OBAMA: I will be happy to see the Republicans test whether or not I'm itching for a fight on a whole range of issues. I suspect they will find I am.

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OLBERMANN: And does the president think he caved?

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OBAMA: So, this notion that somehow, you know, we are willing to compromise too much reminds me of the debate that we had during health care. This is the public option debate all over again. People will have the satisfaction of having a purist position and no victories for the American people. That can't be the measure of what it means to be a Democrat. This country was founded on compromise.

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OLBERMANN: The deal has as its centerpiece, the extension of all the Bush tax cuts for two years, as well as a 13-month extension of unemployment insurance, a 2 percent cut in payroll taxes for one year, and the extension of other tax cuts from the Obama stimulus package, like the child tax credit, the earned income tax credit, the college tuition tax credit. There are also further business tax breaks and this, a weakening of the state tax to levels championed by Republicans.

All of it totaling nearly $900 billion over the lifetime of various tax breaks.

But from the viewpoint of many Democrats and some Republicans, this deal may be built on quick sand. House Speaker Pelosi today said that within the Democratic Caucus, quote, "So far, the response has not been very good. We have some unease."

Congressman Peter Welch says he already has more than 20 signatories to a letter opposing the deal on the grounds that it is fiscally irresponsible.

The Congressional Progressive Caucus has called on the House and the Senate to hold firm on the middle tax cut with no strings attached.

And from some Senate Democrats, harsher words still. Senator Mary Landrieu of Louisiana on extending tax cuts for millionaire, quote, "I'm going to argue forcefully for the nonsensicalness and the almost, you know, moral corruptness of that political policy."

From Senator Bernie Sanders who caucuses with the Democrats, the deal is, quote, "a moral outrage."

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SANDERS: I will do whatever I can to see that 60 votes are not acquired to pass this piece of legislation.

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OLBERMANN: Asked what he thought of the argument, Senator Path Leahy said not much.

Senate Majority Whip Dick Durbin said some Democrats may threaten to oppose the deal as leverage as details are hammered out, quoting, "There is a group that may walk."

Senate Majority Leader Reid today expressed strong concerns, stressed the deal was a framework.

And already complaining about the extension of unemployment benefits in the deal, Republicans like Senator Jim DeMint, Senator Tom Coburn and Congresswoman Michele Bachmann.

Joining me now, "Washington Post" staff writer, columnist for "Newsweek," and MSNBC contributor Ezra Klein.

Ezra, good evening.

EZRA KLEIN, MSNBC CONTRIBUTOR: Good evening, Keith.

OLBERMANN: To put this in a little perspective, it's nearly $900 billion in terms of price.

KLEIN: Yes.

OLBERMANN: How much of that is for unemployment insurance, jobless benefits, the very thing that pumps money into the economy, where it's most needed, most effective and obviously most immediately impacting and absorbed?

KLEIN: Sure. So, $56 billion are for jobless benefits, a 13-month extension. About $300 billion are for the middle tax cuts, tax cuts under $250K, about $130 billion for the rich and the estate tax. Then there's $120 billion for a payroll tax cut, that's a pretty progressive measure;

$40 billion for the tax extenders, that's earned income tax credits.

That's education tax credits. Those are pretty good, too.

And then depending on how you count it, there's either $30 billion or $180 billion for a tax break to help businesses invest in 2011 and 2012. They have them pull investment up.

So, there's a lot going on with a lot of price tags in it.

OLBERMANN: The 13-month extension on jobless benefits, who gets left out? Who has the potential of getting left out of these benefits?

KLEIN: So, it is a continuation of the current law. So, the folks who are beyond 99 weeks, the folks who have been unemployed in places like Nevada, places with very, very high unemployment rates. It's very difficult to find a job if you lost one.

We have not extended past a fifth here. We've not extended it to 111 weeks or 130 weeks as some have argued we should, as I believe we should. But it is - the people who are currently receiving unemployment benefits, about 2 million of whom would have been cut off by Christmas if we don't extend it, those people are set. They're secure.

OLBERMANN: The payroll tax holiday, there are various interpretations of this. One of them is: you're providing sort of a template for later that allows people to screw around with how Social Security is funded. Do you see validity in that?

KLEIN: A little. I actually think liberals go too far and, by the way, conservatives, too. This whole theory of a trust fund that we have, it's such an accounting fiction. We have a budget. We have money that comes into the budget from - or the government from different sources. We use the money in different ways.

It is true the payroll tax is usually used to fund Social Security. But they're saying they'll move funds later on from the general fund, which is normal taxes, income taxes, other types of revenue, over to fill what gets taken out of the payroll tax.

Frankly, at the end of the day, what matters for Social Security solvency is the government solvency. What matters for the government solvency is that the amount of money coming in matches the amount of money going out. And it doesn't matter if that's in the payroll tax or not in the payroll tax. So, that doesn't worry me very much, no.

OLBERMANN: Dealing with the fiscal time bomb of the Bush plus tax cuts, again, two years from now - is that supposed to be easier somehow? Don't they even look more like settled law with two more years of crust on them?

KLEIN: It's very difficult to say. I think - I suspect you may be right. And what's important here, the Republicans think you're right and the White House thinks you're wrong. What the White House will tell you is in two years, it is a much stronger economy. So, you can't say you can't be raising anybody's taxes, even the rich during a recession because we need to create jobs. And there's a higher deficit and potentially will be turning more towards deficit reduction.

Right now, we should not worry about deficit reduction. We should be pumping money into the economy.

And the White House will say, look, that position isn't popular now. Well, they didn't fight on it. But it isn't popular now. It won't be popular then, and we would happily - happily take Republicans on on that ground.

Republicans will say Americans hate tax increases of any kind. We'll win that one.

I don't really anticipate that they're right. But the question is whether or not the White House is more interested in standing firm on that next time than they were this time.

OLBERMANN: Is this trickle-down economics? And in light of the fact that David Stockman was here last Friday saying it's crap and any tax cut should be vetoed no matter who they're for? Why would trickle-down economics play any part in this economy today?

KLEIN: Some is, some isn't. I think it's important to be clear up the $900 billion we mentioned. Only $130 billion of that are tax cuts for the rich. The bulk of it is the tax cuts Obama that wanted to extend. The tax cuts for people under $250,000. Then the $150 billion in payroll tax cuts. That's a good progressive tax cut. That's bigger than tax cuts for the rich.

So, the bulk of it is not trickle-down economics. The bulk of it are things that most people agree (INAUDIBLE), essentially tax side stimulus.

Now, the tax cuts for the rich - that is not a good way to spend $130 billion. It's not very stimulative. It's not - it doesn't appear to me to be great for the economy. It's not good from an equity standpoint.

But it is their - it's what the cost of all the other stuff. It's the cost of the rest of the stimulus.

OLBERMANN: Ezra Klein of "The Washington Post" - great, thanks, Ezra.

KLEIN: Thank you.

OLBERMANN: Let's turn to "Huffington Post" senior political editor, MSNBC political analyst, Howard Fineman.

Good evening, Howard.

HOWARD FINEMAN, MSNBC POLITICAL ANALYST: Hi, Keith.

OLBERMANN: Am I mistaken? Was the president startled today that he was getting blowback for this rather than a round of applause from the planet?

FINEMAN: Well, I think he was, because originally, they weren't scheduling a press conference. And they decided things were going on so much all over town they had to get the president out there to try to take control of it.

I just came from the White House Christmas party and everybody is having a nice quiet time in there. Meanwhile, a couple miles down the road on Pennsylvania Avenue, the House Democrats have been caucusing again. And what I hear is that they're practically, you know, throwing chairs against the wall, they're so upset.

And it's not just the, quote, "progressives," or, quote, "liberals" that are upset. The president with this bill, because the tax cuts that Ezra was talking about are, quote, "not funded," meaning they're no compensatory spending cuts anywhere, a lot of the Blue Dogs, ironically, the conservative Democrats who are worried about deficits, are also claiming that they're upset about this.

So, it's a really interesting and dangerous dynamic for the president right now, even while he's shaking hands with all the press people behind me.

OLBERMANN: Can he pass it? And what happens to him politically if he can't pass this?

FINEMAN: Well, can he pass it? Yes. But is it going to be more difficult than they thought? Yes.

I wrote a piece for "Huf Post" on Sunday speculating about this, but it's really gotten a lot further out of the White House's control than I thought possible and my sources thought possible on Sunday.

It's still likely, I would have to say, better than 50/50 that it will pass, because what's going to happen is the Democratic leaders in the House and the Senate are going to let as many people as possible vote "no" as long as they have just enough votes to pass it. That was their strategy going in. But whether they'll be able to hold the line is going to depend in part, I'm told, on whether other sweeteners can be put in there for Democrats.

And so, this isn't over by any means. The House Democratic Caucus is going to request more, and I'm told that the Senate caucus, which is going to meet again tomorrow, is also going to request further items in this thing to try to smooth away for Democrats to vote for it.

OLBERMANN: The president said he did not want to play politics with this. To what degree is his political imperative to win back voters responsible for this deal as "The Washington Post" suggested today?

FINEMAN: Well, I think it's possible. It's not only possible, it's true. But there are two things - getting back independent voters by showing he can get things done and deal with Republicans, which, after all, is what a lot of independents want. And shift the economic theory from big government programs, whether it's the health care program or the stimulus or whatever, to tax cuts.

And the irony here is that the president is sort of channeling Ronald Reagan in an effort to not become Jimmy Carter. And this - yes, there are tax cuts and as Ezra said, there are a lot of progressive tax cuts.

But the point is, the president is validating the idea of tax cuts as the centerpiece of economic policy. And that's something that the Republicans are best at. So, he's fighting on their turf. But he has no choice, he thinks, but to do it right now. But that's why everybody is upset with him.

OLBERMANN: Is anybody in that building behind you worried that he was yelling at liberals and progressives and Democrats and has not been seemed to be yelling at conservatives and Republicans?

FINEMAN: Yes, well - the whole - the spirit in there was you don't ask, you just wish each other, you know, nice holidays and Merry Christmas. But sure, they have to be worried about it, because a lot of his anger today was about that.

He said, you don't appreciate what I've been doing. You don't appreciate the health care bill, et cetera, et cetera, et cetera, et cetera. I passed this. I passed that.

There's a certain element of personal peak involved which is never good for a president to display in public.

OLBERMANN: Only about 138 percent.

Howard Fineman, senior political editor of "The Huffington Post," on a cold night outside of the White House - go back inside. Say hello to everybody.

FINEMAN: OK.

OLBERMANN: Although they probably don't want to hear from me.

FINEMAN: Yes, sure, they do. OK.

OLBERMANN: No, no. Not after tonight, they won't. Thanks.

FINEMAN: OK.

OLBERMANN: The tax cut compromise, the defeat without a war and a tone deaf administration that had better quit drinking the debilitating mixture of receive congratulation and self martyrdom - my "Special Comment."

And the passing of Elizabeth Edwards.

Countdown continues.

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OLBERMANN: After too many days of silence, there is finally a comment tonight from one of this nation's leaders about just which countries we will have to borrow money from to pay for these tax cuts.

My "Special Comment" on the president and the cuts: You're yelling at the wrong people.

It's no longer an Internet rumor. The rape charge against the founder of WikiLeaks, it carries a maximum four year sentence and it stems from a broken condom.

And the passing of Elizabeth Edwards. If like me you are grieving, we will have advice on how to get through it provided by Elizabeth Edwards.

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OLBERMANN: In roughly 24 hours since the president announced this deal for extending the Bush tax cuts and other tax cuts and new tax cuts, no one in either party has committed to revealing exactly how much we borrow from other countries to finance these tax cuts - specifically the amount we borrow from Saudi Arabia and other Mideast oil-exporting countries.

In fact, in our fourth story tonight, both the White House and congressional leaders in both parties have so far refused to say whether they will reveal how much the U.S. borrows from any Mideast oil-exporting countries, Saudi Arabia, the United Arab Emirates, Bahrain, Kuwait, Oman, Qatar, Iraq or Iran to finance two more years of these tax cuts.

The office of Speaker Nancy Pelosi, however, in a statement to Countdown tonight informing us that, quote, "We have asked Treasury for guidance on their policies with respect this issue of disclosure."

The Treasury Department will have exact numbers next year when it starts auctioning off this new debt in a form of T-bills and bonds, and they do release amounts for other countries. But even though oil-exporting countries as a group already make up the fourth biggest holder of U.S. debt, even before we go further into debt to finance these tax cuts, no one in Washington will reveal how much the individual countries buy.

And as we reported last night, a secret memo declassified in the early '80s confirmed that in 1975, that then-Treasury Secretary William Simon sealed a deal with the Saudis to sell them billions of dollars in U.S. debt in return for U.S. secrecy about the deal. No administration, Democratic or Republican, since then that has revealed how much the U.S. owes to Mideast oil countries.

In September, without revealing how much we owe to Saudi Arabia, President Obama said that U owing more to them was a reason to oppose the top tax cuts.

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OBAMA: We'd have to borrow the $700 billion because we don't have it. All right? We got these deficits and debt. So, we'd have to borrow the $700 billion from China or the Saudis or whoever is buying our debt.

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OLBERMANN: Hope he knows.

Republican Senator George Voinovich said yesterday, quote, the American people should know that a lot of the reduction of their taxes is borrowed money from China.

And responding to our report last night, Congressman Peter Welch, leading Democratic opponent of this deal, said today, quote, "The American people have a right to know from whom we're borrowing money to finance tax cuts for millionaires and billionaires. Greater transparency will allow us to better understand the full ramifications of our fiscal recklessness."

Let's bring in another opponent of the tax cut deal, Congressman Bobby Scott, the Democrat of Virginia.

Thank you for your time tonight, Congressman.

REP. BOBBY SCOTT (D), VIRGINIA: Thank you, Keith.

OLBERMANN: I want to get your position on the deal as a whole. But, first, about debt transparency - you also support full release of these numbers, correct? And why do they matter?

SCOTT: I do. When we pass - if we're going to pass these tax cuts, you have to acknowledge that it's going to be with borrowed money, to extend all the tax cuts we'll be borrowing $3.7 trillion from all over the world. If we pass just the tax cuts for that portion of your income under $250,000, we'd have to borrow $3 trillion. It's a hard case to make that borrowing $3.7 trillion from foreign countries that our grandchildren will pay off is fiscally reckless, but we can afford to borrow $3 trillion from foreign countries that our grandchildren pay off and that's fiscally sensible.

I think the fact is, we need to make these decisions all at the same time. Letting the tax cuts expire would be unpopular. But the other choices we have to make are unpopular, too. I think next year, when we start getting serious about deficit reduction, if we ever do, we're going to find that the choices we have to make next year are a lot more unpopular than just letting the tax cuts expire.

OLBERMANN: Funny that with our debt to China and not to mention Saudi Arabia, maybe Iran, that you would think that might be a big issue for the right, for the Republicans, for the Tea Party. And yet, it's odd - I don't recall hearing a lot about this from them.

Do you know where they are on this?

SCOTT: Well, I have no idea. But the fact is that we would not - we don't have a sensible policy. We're going around - we're trying to do deficit reduction. And when the first thing out of your mouth is tax cuts, you know it's not a serious discussion.

We need to put the - put all of the decisions we have to make on the table and try to make the best decisions we can. We're sitting up here talking about trillions of dollars in tax cuts. At the same time, we don't have enough money for perfunctory cost of living increases for our federal employees.

The Simpson/Bowles recommendation that had taxes on Social Security, Medicare, in the mortgage reduction and a lot of other things that I think would be dead on arrival in Congress, if you add it all up, you would create about $3.8 trillion in deficit reduction - about exactly the same of the "let the tax cuts expire" decision. We need to put all of them on the table at the same time and make a rational choice.

OLBERMANN: The White House we've learned is sending Vice President Biden to meet with the Democratic Caucus tomorrow. What will you tell him about this entire deal?

SCOTT: Well, I think the first we have to acknowledge is if the idea is to extend it two years you may as well get it over with and make them permanent, the whole $3.8 trillion. The idea that if you don't have the backbone to let the tax cuts expire today, you're certainly not going to do it in the middle of a presidential election when the Tea Party can threaten all the Republicans with primary challenges, and you've got 22 Democrats running for re-election in the Senate who would be running essentially against Santa Claus because they're going to be saying, "Let's make the tax cuts perfect for everybody," and you're going to running as Grinch. That's not a - you can't expect that to happen.

The fact of the matter is, when we get two years for now, kick the can down the road two years, that at that point, they'll make it permanent. We might as well do it now and get it over with. We need to put the choices, make them all together, put them all on the table and make the least unpopular choices because they're not - you can't do deficit reduction and maintain any popularity. It's all going to be unpopular.

OLBERMANN: Yes, especially when you're borrowing the money from who knows where.

Representative Bobby Scott of Virginia - thank you kindly for some of your time this evening.

SCOTT: Thank you.

OLBERMANN: No bail for Julian Assange of WikiLeaks after he turns himself in on allegations of rape that "Reuters" now reports began as a plea by two women that he needed to get himself tested for sexually transmitted diseases - next.

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OLBERMANN: As Julian Assange of WikiLeaks turned himself into British police, it is an Internet rumor no longer. The "Reuters" news service reports that, quote, "The two Swedish women who accuse him of sexual misconduct were at first not seeking to bring charges against him, they just wanted to track him down and persuade him to be tested for sexually transmitted diseases."

The so-called rape charges Assange might face in Sweden, "Reuters" adds, carry a maximum sentence of four years, and in this case, originated with a broken condom. Assange denied bail in England even though a spokeswoman for Swedish prosecutors confirmed he has not been charged and is only wanted for questioning.

"Reuters" reporting the sex was initially consensual. But at least

one of the two women involved did not know he was now wearing a condom and

had reason to believe that he might have given her a sexually transmitted

disease.

When both women tried to contact Assange to urge him to get tested, he was allegedly elusive and uncooperative, leading the women to go to the authorities.

Assange's lawyers call the Europe-wide arrest warrant politically motivated, predicting Assange will be released and vindicated. The British judge denied bail, saying that given Assange's history of fugitive behavior, there is a high chance he would flee.

Yesterday, Assange announced he would nearly release a nearly 1 ½ gigabyte poison pill of documents if he or his site were harmed. So far, nothing has been released.

Next - Elizabeth Edwards in memorial.

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OLBERMANN: The first time I met Elizabeth Edwards through the usually antiseptic process of a satellite interview, she told me, apparently with some hesitation, the story of how the inevitable distance of the teen years had separated her from her late son Wade. But she said almost by accident they had begun to watch the same television show each night, and soon it became appointment viewing for the two of them, and then it became the means by which they bonded anew.

Just as I began to wonder why on Earth she was telling me this story, she explained that this had been in the mid-1990s and the show was ESPN's "Sportscenter" with Dan Patrick and Keith Olbermann, and she just wanted to thank me and let me know how happy it made her to see me on television, because it always reminded her of her son.

And in our third story, if that perspective and the desire to share its meaning with an outsider like me does not tell you just how remarkable a person we lost when Elizabeth Edwards died at 10:15 this morning, nothing ever could.

The world first got to know her six years ago as a force of nature on the campaign trail, outspoken, intelligent, empathetic, real. She was the anti-political spouse, a tireless surrogate for the Democratic ticket. Her husband, Senator John Edwards, the vice presidential nominee.

She first learned she had a tumor in her breast on election day 2004, the Kerry/Edwards campaign conceding shortly thereafter. Radiation and chemo put the cancer in remission. After her husband announced he would run for president again, the cancer had returned.

Through it all, she remained positive and upbeat, even testifying to Congress about the need for better health care. Just yesterday, she had announced she was ending the treatment after doctors told her further therapy would be unproductive.

This morning, she died in her Chapel Hill, North Carolina home, husband and children by her side. The Edwards family releasing a statement that read in part, "today, we have lost the comfort of Elizabeth's presence, but she remains the heart of this family. We love her and will never know anyone more inspiring or full of life."

One of my last conversations with her was to discuss her book "Resilience." It was a chronicle of all she had endured, from the death of her teenage son to her cancer diagnosis to her husband's infidelity. She dealt with it all with incredible grace and dignity.

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OLBERMANN: I want to read one passage of this. "Each time I fell into a chasm, my sons death or tumor in my breast or an unwelcome woman in my life, I had to accept that the planet had taken a few turns and I could not turn it back. My life was, and would always be different, and it would be less than I hoped it would be. We all tumble and fall. I certainly have. But, in truth, it is going to happen, in some degree, to all of us."

Is acceptance of the plan B, whatever it is in a particular situation, one of the keys to getting up again after that tumble?

ELIZABETH EDWARDS, PASSED AWAY DECEMBER 7TH: I think that it is. I mean, you can go through the motions, and we all do the day after something terrible happens. We do get up and we do do whatever it is we need to do. If you have cancer and you need to work, you get up and go to work. But that doesn't mean you have really come to accept this new reality.

You start to be more productive. You don't live with eternal discontent. The day you say now my life is different and these are the new parameters of my life. Every time I've resisted, and every time I've come to the same place.

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OLBERMANN: Joined now by Karen Finney, Democratic strategist and friend of Elizabeth Edwards. Thanks for coming in under such circumstances.

KAREN FINNEY, DEMOCRATIC STRATEGIST: Great to be with you.

OLBERMANN: I hesitated in telling that "Sportscenter" story because it sounds flatly self serving. It could certainly have been about "Entertainment Tonight" and Mary Hart for all it matters. The amazing part was the joy that she drew from what most of the rest of us would have been just not mortified by, but reminded of unhappy things.

How many people do that, and how much did she do that in her life?

FINNEY: She did that a lot. She - at the time I got to know her in 2004, she had really made peace with - she would always say I have four children. That was part of the way she felt like she wanted to deal with the loss of Wade. One thing about that interview that was really neat - you know, we kind of rushed in. She sat down in the chair. There was a little bit of back and forth.

And she looked over and she said - she like had this moment and she said, Wade would have gotten such a kick out of this. She said, should I say that? I said, I think that's fine. That's because she was the kind of person who found joy and hope in things that most of us don't pay attention to.

You know, in her books she talks about that. She talks about it's the people that she met on the rope lines. It's the friends and the family, which I'm so glad that she was able to be home with friends and family. That's where she drew her strength. And she was an amazing woman.

She was also a hoot. She had a great sense of humor. I would not want to play her in boggle. She was the best Boggle player you ever could find, having been a literature major. She was just an incredible woman.

OLBERMANN: She was anti-war. She supported marriage equality. She was as strong a health care advocate as we had in this country. And as you point out, her intellect was startling. No matter how much you thought you had seen of it, you realized she was just barely warming up.

I used to joke about this, but quite seriously, why did she not run for office? Why did she not run for president?

FINNEY: You know, she didn't see that at her role. It's interesting. Women always - we struggle with our lives and how we balance it all. She had this great career as a lawyer in her own right and then made the decision to be at home and raise Wade and Kate. Then two presidential campaigns and Jack and a Emma Claire and being a health care advocate.

One of the things about her is even though she didn't run for public office, she still wanted to make sure that her time on Earth was meaningful and that she gave. One of the things we were talking about today in our little group that's been kind of dealing with this that she felt like, in the end, she won. Because to her, it's not that you lose a battle with cancer. It's that you - you know, you find meaning and you go on the next day, as she was talking about in that interview with you, and you keep going with your life. And that's how you win.

OLBERMANN: The outpouring of affection for her, which preceded the later events, the unhappier events; it wasn't a function of that. Might have gotten magnified, but it wasn't a function of that. Did she get a sense of how loved she was in this country for somebody who was an unusual - an atypical public figure?

FINNEY: You know, not really. She's such a modest person. If you watched interviews, she would always say I'm just a person. We would always say, no, no, you're more than that. She didn't think of herself that way. I think that's part of what people connected with, is that she just saw herself as a person.

One of the thing I really respect, if you head her books, she talks about how, look, we're all people. You know, we have good days and bad days. We're not perfect. And to accept that is what love is about. She embraced that and, again, just loved talking to people.

OLBERMANN: And it's such a strange thing to talk about. But I encountered this with the decisions that were made for my dad to stop treatment. Literally the day that we did this, he lasted 35 minutes, and then he was just out nice as you please. Everyone had heard this story yesterday and felt very bad about it, deciding it had gone far enough, and it was over a day later.

I don't want to - it's not like it's planned that way, but the knowledge of herself and how long to fight and when to say enough was clearly evident at the end, even.

FINNEY: Absolutely. I was with her when she first found out that she had cancer, when she first found the lump and then determined it was cancer. Just like Elizabeth, she was like, OK, we're going to deal with this. I think she dealt with the physical piece, in terms of the treatment that she needed, but also dealt with coming to terms with there's going to be an end point. My end point may come sooner. I have to prepare my family for that.

As you say, you don't know when that's going to come, when people go off those medications, because it could be hours. It could be - but she was comfortable and she was happy. That's all you could want for someone in a time like that.

OLBERMANN: And everybody around her comfortable and as happy as they could be under the circumstances.

FINNEY: As happy as they could be and just grateful for the time, grateful to have been part of her life and to have had the experience. That's how I feel, so grateful to have known her and to have traveled on a little plane with her all over the country. She used to make us sing songs out of a songbook. She's the only person I've ever seen make a Secret Service agent sing a song. She just - she was an incredible woman.

OLBERMANN: A hoot is a great word. Karen Finney - and a respectful one in this case.

FINNEY: Absolutely.

OLBERMANN: Karen Finney, friend of Elizabeth Edwards and acting as spokesperson for the family in the last few days. Great thanks and my condolences.

FINNEY: Thanks.

OLBERMANN: Back with a comment on this tax cut deal.

(COMMERCIAL BREAK)

OLBERMANN: Finally tonight as promised, a Special Comment on the tax compromise.

To paraphrase Churchill, again, let me begin by saying the most unpopular and most unwelcome thing: "that we have sustained a defeat without a war, the consequences of which will travel far with us along our road. We should know that we have passed an awful milestone in our history, when the whole equilibrium of American politics and policy have been deranged, and that the terrible words have, for the time being, been pronounced against this Administration: "thou art weighed in the balance and found wanting."

In exchange for selling out a principle campaign pledge, and the people to whom and for whom it was made, in exchange for betraying the truth that the idle and corporate rich of this country have gotten unprecedented and wholly indefensible tax cuts for a decade, in exchange for giving the idle and corporate rich of this country two more years to accumulate still more and more vast piles of personal wealth with which they can buy and sell everybody else -

In exchange for extending what he spent the weeks before the midterms calling tax cuts for millionaires and billionaires to people who have proven, without a scintilla of doubt, without even a fig leaf of phony effort to make it look like they would do otherwise, that they will keep the money for themselves -

In exchange for injecting new vigor into the infantile, moronic,

disproved-for-a-decade three-card Monte game of an economic theory purveyed

by these treacherous and ultimately traitorous Republicans, that tax cuts

for the rich will somehow lead to job creation, even though if that had

ever been true in the slightest, the economy would not be where it is today

-

In exchange for giving tax cuts for the rich which the nation cannot afford, and extending their vintage through the next election and thus promising, at best, a reenactment of this whole sorry, amoral, degrading spectacle during the 2012 presidential campaign, when the sides will be climbing over each other to again extend these cuts -

In exchange for this searing and transcendent capitulation, the President got just thirteen months of extended benefits for those unemployed less than 100 weeks. And he got nothing, absolutely nothing for those unemployed for longer, the 99ers.

This the Administration is celebrating, taking the victims of Republican economic policy, taking the living breathing proof that the Bush tax cuts for the rich do not create jobs, and putting economic bulls eyes on their backs as of next December.

On the one hand, unaffordable tax breaks for the beneficiaries of the Bush tax cuts, made ever more permanent as they threaten to suck four trillion dollars out of government revenues in the next decade.

On the other hand, an insufficient dead-end unemployment solution for Americans who would actually work for a living, a solution made ever more temporary.

And we are hearing nothing about those 99ers, even though the numbers of them will balloon from two million to four million or more by next December even with this deal, even though just last Thursday, the President's own Council of Economic Advisers reiterated the reality that the easiest way to create jobs and keep jobs is to make sure that the unemployed continue to have money to spend.

The unemployed, unlike the rich whom this president has just bowed to, are, in fact, the job creators. They do not have investment portfolios to expand. They do not have vast savings into which to stuff the government checks. They have to spend the money. And the Council reported last week that when someone becomes a 99er, his or her household loses at least one third of its income.

And where the 99er was the sole breadwinner, that's four households out of ten, they lose nine tenths of their income.

The economy is surprisingly simple. If business and the rich won't spend, and the middle class can't spend, the only factor left to keep pushing money into the insatiable maw of capitalism is the government.

So, should the government give the money to the rich who keep it, or to the not rich, who spend it? Apparently this President does not know the answer to that question, even though he has his own Council of Economic Advisers.

Mr. President, for these meager crumbs, you have given up costly, insulting, divisive, destructive tax cuts for the rich, and you have given in to Republican blackmail, which will be followed by more Republican blackmail. Of course, it's not just tax cuts for the rich that you've given up.

There is also your new temporary payroll tax holiday, establishing a precedent that the way money is pumped into Social Security should be negotiated and traded off, and making it just that much easier to gut Social Security later.

And, oh by the way, in the middle of a crisis over making temporary Republican tax cuts permanent, you give the Republicans another temporary Republican tax cut that they can come back later to blackmail you into making permanent.

Well, sir, at least that's the end of it. Except, of course, for the estate tax, what Republicans so happily call "the death tax," which will be reduced from its 2009 levels.

Huh?

The money given by one dead rich person to some living rich persons will not be taxed up to five million dollars. More than five million and it's 35 percent, which is less than it was under the tax laws of President Bush's last fiscal year. Sir, you have given undeserved tax breaks, and you have carved them a little more deeply into the stone of law, to rich people, living and dead. And you want me to tell them which Democrat proposed this estate tax giveaway part?

Blanche Lincoln! Blanche Lincoln, repudiated by nearly half the Arkansans in her own party, and then repudiated by 63 percent of the voters in Arkansas. Mr. President, you're listening to Blanche Lincoln? What? Were Bob Beckel and Pat Caddell unavailable?

This president negotiates down from a position of strength better than any politician in our recent history. It is too late now to go back and ask why the President, and why the wobbly Democratic leadership, whiffed on their chance to force John Boehner to put his money where his mouth was.

In September, Boehner said if he had no other option, of course he would vote to extend tax breaks only for the middle class. So the President and the Democrats gave him another option, naturally. But didn't extending the Bush Tax Cuts for the wealthy became necessary to get Republican support for extending the jobless benefits?

Nonsense.

Five times in the last two years, the Republicans have gone along with extending those jobless benefits, and they've done it without being bribed with tax cuts for the rich. Even now, Boehner's September confession, and the GOP's unwillingness to take the blame for killing off jobless benefits offered an alternative blueprint for this President:

Let the law expire as scheduled in 24 days. Let all the tax breaks go. And when the Republicans take over the House and try to pass them anew, if they somehow are not stopped in the Senate, veto anything that does not keep tax cuts for the middle class and unemployment benefits as the dog, and perks for the rich as the tail.

The GOP is still terrified of being blamed for cutting off the unemployed. You take that fact and you break them with it.

There is only one possible rational explanation for this irrational and childish transaction. There are Republicans and Tea Partiers who are still intent on cutting off their noses to spite their faces, the "Blind Rage Conservatives" for whom any compromise is disaster, just as for this president apparently no compromise is disaster.

Maybe the reason the administration's numbers don't really add up in this deal is that the administration was too busy instead counting votes, and there really are enough on the far right to sink it, and the President winds up having his cake and eating it too. He proposed what he can call a "tax compromise" and then he can have it derailed publicly and embarrassingly by the Republicans.

Maybe the political calculus here exceeds both in priority and quality the real calculus.

But I deeply doubt it. Yesterday, I had an exchange with a very senior member of this administration who wanted to sell me on this deal. I pointed out that that was fine, except that, as I phrased it to him, "frankly the base has just vanished." "Well," he replied, "then they must not have read the details."

There, in a nutshell, is this Administration. They didn't make a bad deal. We just don't understand it.

Just as it was our fault, Mr. President, for not understanding your refusal of even the most perfunctory of investigations of rendition or domestic spying or the other crimes of the Bush Administration, or why you have now established for those future administrations who want to repeat those crimes, that the punishment for them will be nothing.

Just as it was our fault, Mr. President, for not understanding Afghanistan. Just as we didn't correctly perceive, sir, the necessity for the continuation of Gitmo. Or how we failed to intuit, President Obama, your preemptive abandonment of single payer and the public option. Or how we could not have foreseen your foot-dragging on "Don't Ask, Don't Tell."

Just as we shouldn't have gotten you angry at your news conference today and made all the moderate Democrats wonder why in the hell you get publicly angry so often at the liberals who campaigned for you, and whether you might save just a touch of that sarcasm and that self-martyrdom for the Republicans.

And of course, Mr. President we totally betrayed your administration by not concluding our prayers every night by saying "thank you for preventing another Great Depression; you are entitled to skate along on your own wonderfulness indefinitely. And if you get less than you could have on health care reform or taxes, well, that'll be OK; we're happy to pay 10,000 bucks for a 300 dollar car because hey, it could've been 20,000, right? And because we only expect you to do one thing correctly during a presidency, and you know you had pretty much cleared that obligation when it proved that you were, indeed, not John McCain."

We are very sorry.

In some sense, the senior member's remark about how we "did not read the details" is not utterly absurd. We have enabled this President, and his compromises spinning within compromises. And now there are, finally, those within his own party who have said "enough. In the Senate, the Independent, Mr. Sanders has threatened to filibuster this deal. He deserves the support of every American in doing so, as do Mr. Hoyer and Mr. Conyers and the others in the House.

It is not disloyalty to the Democratic party to tell a Democratic president he is wrong. It is not disloyalty to tell him he is goddamned wrong. It is not disloyalty for the 99ers and the 99ers-to-be to rally in the streets of Washington. It is not disloyalty to remind the president that he was elected by people to whom he had given a clear outline of what he would do for them, and if he does not steer out of the skid of what he is doing to them, he will not only not be re-elected, he may not even be re-nominated.

It is not disloyalty to remind him that we are not bound to an individual. We are bound to principles. If the individual changes, or fails often and needlessly, then we get a new man. Or woman.

None of that is disloyalty. It is self-defense. It is the acknowledgment that, as my hero Thurber wrote, you might as well fall flat on your face as lean over too far backwards.

That is what the base is saying to this President about his presidency. "Well, then, we must not have read the details."

The Churchill quotation, as opposed to the quotation from that very senior member of your Administration, Mr. President, is from October 5th, 1938.

I don't want to make any true comparison to the historical event to which it related. The viewer can go ahead and look it up if they wish. I will confess, I won't fight if anybody wants to draw a comparison between what you've done with our domestic politics of our day to what Neville Chamberlain did with the international politics of his.

The rest of what Churchill said, paraphrased, but only slightly paraphrased, bears repeating again. The terrible words have for the time being been pronounced against this Administration: "Thou art weighed in the balance and found wanting." And do not suppose that this is the end. This is only the beginning of the reckoning. This is only the first sip of a bitter cup which will be proffered to us year by year unless by a supreme recovery of moral health and political vigor, we arise again and take our stand for what is right.

Good night and good luck.

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