>> this is the "the chris matthews show." >> ask not what your country can do for you. >> tear down this wall. >> i can hear you. >> the time for change has come. >> front and center, is the president we're seeing now barack obama at his best or at his worst? is the man that stood up this week and cut a deal with the triumphant republicans a sellout, a political hack, or the progressives' truest hope. a grown-up the country needs now. remember the december review in afghanistan that was promised. isere b thengacki for this war that almost no one likes. will the left explode or keep on

keeping on. and bad tidings for christmas. tl coa the politicians put them themselves. the lists are in the books. hi, i'm chris matthews. welcome toll show. with us today, michael duffy, andrea mitchell, the "new york times" helene cooper and the "washington post" david ignatius. first up, it's a december to remember. the president cut what he called the best possible deal on taxes. jobless benefits, the works. he has shown disdain for those who are resisting his decision. >> take a tally. look at what i promised during the campaign. there is not a single thing that i said that i would not do that i not either done or tried to do. chris: michael, i hav'ten seen him like this, eyes wide open addressing his critics head on. >> pointing the finger in case you missed the point. the liberal part of the obama presidency is probably over. he is moving into a totally different phase here. he is doing it because he has to.

unemployment numbers were rising again. his popularity was beginning to dip into the low 40's. he cuts this dramatic deal with republicans on a tax cut, he gets a much bigger second stimulus, bigger than the first stimulus with the democrats. chris: yes. >> he gets it at a time that is perfect if you're running for re-election which he is. the liberals may scream, but they have been screaming about barack obama since the beginning. they have been upset about don't ask don't tell and gay marriage and all national security stuff. he is refocusing his national presidency on the any and he is reminding independents that have kind of lost their love for him why they did chris: i am dying to hear what you think. >> how do you spell try -- trian gulation? how do you rebuild and win re-election? >> is he really challenged?

does he want to fight with the left or make a new set of coalitions here? >> both. you make a new set of coalitions, regain the center which you lost after the midterms in the midterms by fighting with the left. this ss aister soldier moment, sort of a mini moment i think. chris: it reminds me of ronald reagan. he comes on strong the first year, big tax cuts, a lot of conservative stuff, loses in re-election 26 seats, accepts it with tax increases. and the grander coalition. is this their game book he is playing? >> it is. i think president obama just had a really good week. if you look tetra ject ri of how this week -- trajectory of how this week started, people are writing he caved into republicans. on wednesday, he has done this press conference and he is looking as if he is standing up to his own party. he has moved toward the independents. he is very much appealing to the independents that he is going to need in 2012. now he sees standing up to the democrats.

for him, that's the place he wants to be right now at this stage in his presidency. chris: sweet spot for him. >> it's a completely sweet spot. chris: somebody said you were one of the smartest reporters in washington. >> someone said that? chris: i confirmed that. david, your thoughts, everybody is moving towards up here as we go around the circle here. >> i have to agree. i think the president was on his game. this is where he wants to be as david said, he wants to be the bridge. the hard part of the strategy is all ahead. he is really going to have to tspli his party and lead a part of it away into a coalition with republicans. that's really hard to do. he is going to have to sketch a vision of how you lower the deficit with a package of compromise proposals in the center. i think he is going to have to talk about fundamental changes in the fax system. those are big leadership moves. if the president is as ready as he is for them as he is in the film clip, it's going somewhere. chris: he has to get through the next year, through the next

week. there are adjustments coming from the house, perhaps from the president, will the republicans accept them? are they a little loose here in terms of what they will accept? >> they know it's going to get a little bigger before it gets passed. they're so happy to have the democrats fighting among themselves. they have been waiting for years. you talk about the theater of that moment where he is pointing his finger. he didn't even tell the speaker of the house that he had done this deal until after he announced it on tion. it was designed to play to upset them, to anger him. i think there was a little concern at the white house late in the week that we hadn't upset them quite enough. the more the liberals get upset, the better it was for their boogie to the middle here. the question is next week when we go in the vote which is in the senate thursday, friday, how many will come along. more than people expect. chris: reporting here, isn't it true, i'm opening this up, that there was a lot more participation by the democratic house and liberals before they decide to get out of the bargain? they were dfere a chance to negotiate with republicans and the white house said no, you go

it alone. biden had to cut the deal with mcconnell. andrea, the people like pelosi and steny and the rest of them got in on the negotiation, but they rather the president got his hands dirty before they come in? >> pelosi is trying to lead her very liberal caucus. they're not following her. there is upset that she hasn't been able to deliver them. >> he loves this. he doesn't want them as enemies. at the end of the day, they don't have that -- anywhere to go. this is exactly what he wants because it puts them exactly where he wants to be. he can see even after compromising with the republicans, he can still see as if he is standing tall. >> i make the noise. chris: does any disagree that he wants to go with this fight to the left? >> this president doesn't like to have enemies. that's the one problem with the strategy. this is a president who likes to have friends. he wants to build a coalition of friends. you got to make enemies. one thing, chris, i tnk the house democrats are turning

themselves into a protest party deciding we're not going to be a governing party, we're a protest party. we're like the republicans and protest things. that's a problem. chris: the moderate democrats all lost. they're not there anymore. >> last saturday night before the kennedy honorsrdwas at the state department for these talks and then on sunday morning she couldn't deliver her troops. chris: we turned the corner this week, 12 of our regulars including andrea, can the president get the g.o.p. to compromise on a big deal on the huge debt next year? it's unanimous, 12-0, our meter says he could get compromise next year on the debt. andrea, so this movement of the president toward the center negotiating and finding a deal with the republicans, offending the left more tends next year? >> some kind of big deficit reduction is entirely possible. someone should tell the bond market which is crazy all week with the spending in this tax cut deal and seeing that the deficit commission report has not been embraced more definitively. in any case, the timing is right

for this. talk about tax reform is a little bit naive on all sides. it took years for bill bradley and company to get that. chris:'set talk about debt reduction. durbin joining the bipartisan commission, is the president capable of pulling a grand deal leapfrogging perhaps the interest groups, the unions and all, going to the tea party types and coming out, wow, with the kind of thing reagan was able to do towards the end, security reform, entitlement reform, that kind of thing? >> not in the next two years. he takes a piece, just the tax reform piece, took a piece in the proposal this week, he took the payroll. some of ehelements are in what he is talking about with the republicans are in the big deficit package. he will not be able to do that. chris: we promised to get to the afghanistan thing. nobody likes the war. it's an unpopular war. it's horrible to fight. thank god for our servicemen and women over there. where does that stand in terms of this review coming up in december? >> chris, the review is going to

be less than a big deal than we once thought. the white house signaled a couple of months ago, the phrase that was used with me is fine-tuning, not changing the channel. they're looking at this. they have given themselves additional maneuvering room that saying the troops will leave in 2014 taking less pressure. chris: it should stretch out. >> the american left hasn't been buying it for months. there is a lot of unpipeness to the left and generally. the military -- so long as the military supports this and says this is a strategy we think is appropriate, i don't see this president picking a fight with general petraeus. >> i think what you saw at the meeting in lisbon a few weeks ago, they punted the question to 2014. president obama now has an enormous amount of time. they're going to withdraw a couple of groups of troops until next year. they have until 2014. i don't think general petraeus is going to be asking for any

more certainly. i think they have now -- that has sort of fizzled. i still think it could be an issue next year. chris: let's go to next year. will the president have a better year next year, michael? >> yes. >> i think so. >> i hope so, yes. >> hard to do worse. chris: before we break, after 25 years, the great man, larry king and "larry king live" will end their run, at least a run of that show on thursday of this week. larry made a lot of political news over the years. of course, he got ross perot to declare for president on his show? >> is there any scenario in which you would run for president? can yoe givu me a scenario in which you would say, ok, i'm in? >> number one, i don't want to. number two, if you're that serious, you, the people, are that serious, you register me in 50 states. chris: and it was larry that the clinton team itself chose to be

in the critical debate in nafta. here is ross perot and al gore almost in caricature. >> you asked me and i'm trying to tell you. >>you brought your charge tonight. i want to know what specific changes you would make in the treaty. >> let him respond. >> how can i answer if you keept interrupting. chris: al's finest moment. he drove him nuts. there were lesions of imitators of larry of him over the years. here is a "saturday night live" take of larry putting more guests on the air than planes in the air on a friday night in new york. >> joining us for a special interview is president bill clinton. you have agreed to put your many scandals behind you to face your accusers in an open forum. >> yes, that is correct. i want to end all of these pointless allegations once and for all and get on with the business of running the country. >> fair enough. with that in mind joining us live from the watergate apartment, ms. monica lewinsky.

>> hi, larry. >> joining us from little rock, arkansas, ms. paula jones. >> hello, larry. >> also joining us from the federal penitentiary in fort worth, texas, where she is serving time for refusing to testimony against bill clinton isusan mcdougle. >> hi larry. >> and john wong. also joining us from arkansas, jim guy tucker, william beginsburg joining us, the attorney representing ms. lewinsky. leon panetta, also vernon jordan. >> thanks, larry. >> larry, i am so glad to have this opportunity to discuss -- >> also joining us is marshall lewis, the mother of monica lewinsky and charlie tree is with us. in additoin, jning us from washington as always brent perry, the attorney for paula jones defense fund. and maria, a democratic

fundraiser. donovan campbell, the attorney for paula jones, katherine willie is with us. danny ferguson, the state trooper, and finally bruce lindsay. everyone, thank you for joining us. >> good to be here. chris: when we come back, "time magazine" is out with their top 10's of the year. what were the top 10 political gaffes. plus "scoops and predictions." be right back.

chris: welcome back. "time magazine" is out with a raft of top 10 list this is week beating the rush we thought we would take a look at their top 10 political gaffes of the year.

a couple stand out. -time's number one was vice president joe biden congratulating president obama on the passage that day of health care. i have to say this is biden just being enthusiastic. >> this is a [bleep] day. chris: now come on. duffy, you're the "time magazine" guy. why di p youut him up? he is trying to be a little bit excited. >> that isn't really a gaffe. a gaffe is when you say something -- chris: that's at the top of your list. >> a gaffe is when you say something that is true. chris: well, there you go. let me ask you, andrea, let's look at michael steele. he is the republican national chairman. he takes a lot of heat of what he says. let's catch him on this one. >> this was a war of obama's choosing. chris: this was a war of obama's choosing. analyze the thought behind that. >> we could have a whole

magazine issue on michael steele's gaffe. going back to what biden sai biden is now on the hill doing all of these one-on-one negotiations. biden is the man, he is the right-hand man. chris: he is the correcter. he is the back-slapping, dropping the f-bomb, he is the happiest guy in the white house. >> the heavy lifting. chris: what role does he play? >> enormously influential now. biden with rahm gone, rahm emanuel gone, biden is probably, i would say one of the president's most influential advisors. chris: he doesn't make gaffes that hurt. here is gibbs, the white house press secretary robert gibbs who got overheated last august and talked as the critics as the professional left. he said to add to this i hear people saying he is like george w bush. those people ought to be drug tested. is it good for him to stick to the left like that? >> i don't think that's a gaffe

either. i think much more of a gaffe was rahm emanuel when he said you guys are to the left, you're being retarded. that's a gaffe. chris: you shouldn't use that word. this thing about the white house, let's get back to whether a gaffe, they want to stick to the left this hard? >> they absolutely do. i don't think there is any doubt that in order -- one of the thhegs tiny learned from watching chris: biden would never do this. >> the independents think that democrats and republicans are both done. >> robert gibbs was six months ahead of the times. >> he was trying to bait the left and it didn't work but it's worked now. chris: you think it's in the interest of the white house to say these nasty things about the left so the people from the democratic progressive wing -- >> the president was being attacked like he was the last week by the house democrats, really focusing their fire on the president, i think that raises his stature. chris: what is the future for people like gibbs? is there a big shuffle over

there? >> we keep hearing that and keep waiting. i think at the end of the day, i think gibbs will stay. i don't know if he will stay as press secretary. he will stay at the white house. at the end of the day, i don't know how much of a huge reshuffling we're going to see. chris: remember the song "this could be the start of something big" could they be bringing big shots in, heavyweights into the white house? is it possible? >> it's possible. look at the pentagon and defendant department with gates going as well. chris: heavyweights going in? >> particularly in the economics, this they are going to create a bipartisan team, they need big powers. >> they are bringing in an economic spokesman who can talk to wall street. he is going into the devil's den. chris: pro business? >> he is going to try. >> they may bring somebody big in, but robert gibbs and the people who have been with him in the gipping are going to remain in t ihenn

chris: welcome back, michael, tell me something i don't know. >> how many executes have approved a constitution convention for a balanced budget. 31. 11 new states, this sounds like black helicopter stuff, 11 new state legislatures are in republicans hands, we could see the 37 required. it hasn't happened before in american history of the with the

country in the mood it's in, it could happen. in the next two years. >> the president alrdyea sounded out a very prominent person to see iy thef would be chief of staff, but it didn't fly. >> and that person's name? tell me something i don't know. i don't know whot is. why didn't it fly? >> the president is unwilling to go -- the person is unwilling to go into the white house. >> an invitation was issued? >> it was a feeler. i don't know if an invitation was issued. chris: tell me something i don't know. >> what the state department and administration is most worried about with these wikileaks stories is not what is coming out right now, but later you're going to see reporters diving into these 250,000 documents every time there is a different story. a treasure trove that is going to be here for the rest of our lives. chris: like the nixon tapes. yes. >> another bomb is going to go off in the middle east, i'm sorry to say with the release of

an indictment probably by the end of the month by a special tribunal that is investigating the murder of the former prime minister of lebanon. it might name iranian officers who were in lebanon at the time and may have been part of this plot. chris: they're back in iran. >> they're not pursued by marshalls. chris: when we come back, the big question of the week, who doesanel call the person of the year for 2010. we have duffy here from "time" by the way. be right back. [ mom ] my son only wanted one toy this year.

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chris: welcome back, our big question who is your nominee for person of the year, david? >> it's painful to say this but i would say julian assange the head of wikileaks. the release of the wikileaks documents is one of those game changing events about public information and the way the world works. people will be talking about it 50 years from now. >> what he said. >> isn't that right? >> i'm not going to say him. i would say because of the midterm elections, the house going republican, the senate not going republican, the tea party. they have changed the debate on deficit reduction. you have got ron paul now in charge of monetary policy from

the house. they have changed politics for now in washington. >> mike duffy. >> i'm not telling you. i voted early by absentee, i haven't told my wife, can't tell you. but tune in wednesday, find out. it's a great parlor game. >> mitch mccon net the senate republican leader who pushed the president to the left. he made him into a left wing president because of republican policy. it was bntlliari. it allowed the republicans to have a brilliant political year. i'm not sure it was in the country's interests. he made the big difference this year. thank you for the great roundtable. that's the show. thanks for watching. that's the show. thanks for watching. see you here next week.

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