combined. we have a lot more work to do. [captioning made possible by nbc universal] >> ask not what your country can do for you. >> tear down this wall. >> the time for change has come. chris: in the middle east, a duned ship in the night. but the people are patient. they wait their time. the ayatollah set in paris for iran to be ready. the opportunists in egyptian waiting for tunists to erupt. if our western world is so fast, why do we keep getting surprised? with the wind blowing in the desert, why do we think allies we toast at sundown will still be allies at dawn? did we miss the signals? are we too fat and happy with

the deals we got. with the huge bed we had with mubarak, did somebody notice he was pushing 83, he wasn't going to let go, h weas pushing his son to hold on? why do our alliances seem as old and cranky as the ottomans. finally denial, not just a river in egypt. we've seen it before. here it comes again and secretary rmed's -- rumsfeld's return. can he sell a book saying the iraq war was right and the mistakes weren't his? can he take one more right on de-nile? i'm chris matthews w us bob woodward, bbc's katty kay, ann kornblut and "time" magazine's joe klein. first up, if egypt turns from strong moderate ally to a difficult, hostile islamic state, that might remind many of us how iran turnford ally to threat. back in 1997 when the shaw fell, president carter displayed washington's confidence in that western ally.

>> iran because othe great leadership of the shaw is an island of stability and one of the more troubled areas of the world. chris: as to egypt, the island of stability language, was echoed just three months ago by secretary of state hillary clinton. >> the partnership between the united states and egypt is a corner stone of stability and security in the middle east and beyond. chris: to the great investigative reporter of our time, bob woodward, tchow we not know what was going on in egypt before this happened to us a week or so ago? >> well, we're not sure how much we did know. there's a lot of intelligence that's not out. but i think one of the defense in the process is the egyptian intelligence service is a wholly owned subarry of our cia. the focus, nun one terrorism. number two terrorism, and number

three, terrorism. so there was no attention or very little attention given to the internal political situation . that's exactly what happened in the carter administration with iran. it was a surprise. then the worry was about are the soviets going to invade iran? chris: so what do we do is put that filter over the world that says, look for terrorists. if they're not there, move on to some other country and look for . rrorists we didn't know what was going on in terms of all of the secular groups, how they might overwhelm the islamic brotherhood, who would win and in the next turn situation? >> to some extent washington was blinded by fear and phobia of islamic extremism. and it botched the line that egypt has sold very willingly the last 30 years that your choice when it comes to egypt is have an awe torrian government, government of hosni mubarak or extremism. and washington must have known better.

they knew in '82 and they knew here was a lot of discontent in the country not at least because of the economic situation because people were unemployed and food prices were going up. that alone they must have known. and had you it in the senate as well. chris: i want to make a comment before you comment here. you write, to transfer egypt from the soviet account to the american side back in the '70's and was perfected by jimmy carter. iteaas rlism and right at the time. too often realism becomes just an excuse for maintaining the status quo. joe, we just sitting there? >> yeah, this was a regime that looked like something out of a gabrielle garcia-marques novel where the dictator lives for 347 years and nothing ever changes. i hear the white house is not very pleased with the cia these days. but i was checking back, bob, to some of the people who were involved in the carter administration and they say the cia was better this time than

they were last time. last time they had a years' worth of warning -- chris: we don't elect the cia. we cover the president. we cover the white house. it's not entirely the job of the agents to do what the principal asked them. why didn't president obama, why didn't tom donovan, why didn't the people around the president say what's going on in egypt? that guy is 83. what will happen next? >> in fairness, they were getting warning signals. he had the egypt working group ahead for some time. there were instabilities. be prepared for this. what he was going to do about it to prepare, what were they going to do? press harder, talk about it more? there were signs the precise timing, the catalysts for it they didn't know. you're right, they didn't upset. the hill is upset. chris: we have all of these groups out there at the national democratic convention, soft groups to encourage democracy, teach people how to win elections and all, didn't they know about the social media going on over there with facebook and organizing? >> i think maybe there's a false premise here that if you know what's going on, we can do something about it.

>>y. >> what can we do? chris: who would we be rooting for right now? who would be bank rolling? >> to some extent america rooting for somebody is the surist way it get that person a made in america brush. even if you're not obvious about it. >> i think rather than attaching ourselves to individuals, as we seem to do case after case after case here, we should be attaching ourselves to institutions and if there's any hope at all for us long term in egypt, it's a relationship between our army and their army. chris: right. >> the officers who trained together and studied together in places like the army war college, ft. leavenworth, that's a strong relationship and they need our spare parts down the road. chris: and backed up by money. anne, tell me about the white house you cover. the top horn by asking the questions, what will their answers be? >> there's a shift. in the beginning they didn't want to align themselves with anybody. over time we now see them

talking more forcely the past couple of weeks over the last ten days about wanting mubarak to go. their defense would be, they're taking it hour by hour. they have really wanted to not prejudge, not make it seem like this is an american dream. chris: what was a word they used they should not have used? >> now. chris: now was -- >> we're in favor of the transition. and then the president said and the transition has to begin now. >> but the drive is always said, look, we have to be on the right side of history. and so other words what's the politics of this going to be. we don't want to look dumb but the fact is no one knows where this is going. there could be a strong man who would take over in the government and like in some of the eastern european countries, you know, before the fall of the soviet union, you could have years -- chris: your question. you said we always look through the filter and look foy for the trourt threat. let's talk about the islamic d.ooherh they killed saddam.

they have strong relations fostering hamas and groups like that. do we snow if they have the clout -- know if they have the clout to take over? >> take over wholesale seems unlikely. they're only getting like 30% of the vote which suggested if they have a free and fair election, they would be an important player. i do know one thing that america is again getting wrong footed on is the backwards and forwards have we or have we not been talking islamic brotherhood? if we're clear they are going to be and important player, it seems to me if we're not talking to them we should be talking to them. >> there's been all kinds of conversations with them. >> but they're in denial -- >> with six of us, six of them a couple of years ago >> but there was denial in the white house about the fact they're talking. still p.j. curly from the state department saying, no, we're not talking to the militant brotherhood. why does washington feel so defensive about that? >> they sent mixed message. we're talking to the opposition. we're not talking to them but we

are. >> no. they have said privately that there have been back channel conversations. like many things, the situation they don't want to say it out loud. chri p fors:eople not watching this more than an hour a day, because it has become an american obsession. we're worried about one thing. we all know what it is, another ayatollah coming up. all of a sudden he's got the big fl up there and he said this is an islamic republic and we hate you guys. forget the deal with israel. isn't that the worst case? >> what we're most afraid of is this becomes -- this goes viral and it happens across the middle east. we have to figure out how we're going fotion ourselves in that region now because in country after country you have the same situation. chris: do we have that plan? >> in the white house they probably have to tune down this idea that somehow we are a big player on this chess board. we are not on the chess board. we are on the outside watching this. at some point the american administration can have an

impact but this is highly volatile. chris: with egypt and sflirle >> the brotherhood, name who these people are. they don't know. it's like their back channeling contacts but it's through the intel world. >> they think it's about washington and it's not about washington in this case. this is about events that are moving very fast there. in the iran analogy, there are not the clerical structures in place in egypt today that there were in iran before the '79 revolution. there are important differences. to start saying this islamic organization is exactly what we saw in '79 -- chris: i think we do pay attention. i want to give you an example as we go to break, honoring arab leaders has been a paramount task for presidents but sometimes the bowing and scraping has been comical at least to american ears and eyes. ♪ see the pyramids of all the nile ♪ >> all-time favorite image, george w. bush down in crawford, his ranch 2005, just 6 years ago

tiptoeing through the texas blue bonnets with the prince of saudi arabia. they were meeting about a current oil crisis and bush was trying to get the saudis to increase proioctn. ♪ you belong to me ♪ chris: jon stewart, ocourse, had this take back then. >> earlier this week bush met with a key player on the world energy scene. the president of saudi arabia. the president greeted him with a kiss on both cheeks and then led him by the hand into his ranch. >> that is ucceptable on my part. two easy to joke about the two of them kissing and holding hands. the truth is both are saudi customs saying the french would be trust. if you heard what they talk about, believe me, you hardly call them sissies. >> this is the blue bonnet, this is our state flower. >> added prince abdullah -- i mean -- gorgeous! he added, we used to have fields oblue bonnets in saudi arabia.

then we beheaded them in a soccer stadium. chris: message we dare. when we come back, former defense secretary don rumsfeld is sought with his defense of the iraq war. we will talk with bob woodward who really wrote the book on that war, indeed several of them. is rummy telling the truth?

chris: did you advise the president to go to work? >> he did not ask me is the question. to my knowledge, there are number of people he did not ask. chris: did that surprise you as seblingd? >> well, i thought it was interesting. chris: welcome back.

that was former defense secretary donald rumsfeld on hardball in 2004, told me he was not consulted with the decision to invade iraq. now he's out with a memoir, "two weeks after worst terrorist attack in the our nation's history, those of us in the defense department were fully occupied. but the president wanted new plans and he wanted the options to be creative." bob, you wrote several books on the subject of the bush war team and the third was titled "state of denial." are they still in denial? why is he scampering away from responsibility of the war? >> he is. in fairness, rumsfeld should have his say and i have not read the book but this idea two weeks after 9/11, i interviewed rumsfeld on the record, it's on the pentagon website, and he confirms what bush said in his memoirs, it was no november the day before thanksgiving that bush called him in. this was a moment of intoxication. it looked like they were going to win the afghan war at that point. and bush kind of said, let's do it. but, again, you go into the records, it's rumsfeld who's

pushing iraq a day, two days after 9/11. chris: that's what we have at nbc, that is in fact the record. coming in the tank there when they were talking. >> when these people write memoirs, you know, their researchers going through and say, you have this problem and they say, well, let's not write about that. they just -- >> i don't have much time for this guy. he was the worst secretary of defense in american history. i mean, he was really -- he came in with a single focus which was transformation of the military and then he got involved in and he was going to fight iraq in a new lightweight different way and he got stuck there and he didn't follow through. he wasn't interested. the uniformed military, the generals hated this guy because he cared more about how we were going to face china ten years from now then what we were going to do in iraq. chris: try writing an american history book for high school kids explaining why we went to war with iraq and who made the

decision. it's hard to get the basic facts down. >> and isn't that why we're still talking about it because we still haven't had a satisfactory answer on why america went to war and lost more than 4,000 troops there. i think -- chris: and when did they make the call? anne, you were at the white use. >> this will be dick cheney's book, which comes out in august. chris: you think that will be the trump card? >> it's the final one in all of these memoirs. chris: does it say bush was to the side or i was the number two man? or will he lay back and say i was with this from the beginning? >> he did. cheney believed in it and bush quotes cheney at his memoir at one of their lunches cheney saying are you going to take this guy out or not? which is kind of an incentive to do it? cheney was very influential. but, look, we do know and in a sense most of the history of this has been written and from what i can tell in rumsfeld's memoirs, there's not much new except semi-denial and

justification. >> i think history's been written but i still don't see it. i still don't -- chris: why we went to iraq. >> why we went to war in iraq. >> it was a feeling of hube russ. we had to show the islamic world we weren't going to be able to get away with supporting groups like al qaeda. chris: what does a bomb have to do with al qaeda? >> nothing. >> and this mystery linger. it looked like it was going to be very easy. paul wolfowitz, rumsfeld's deputy said oh, we're going to do it in a week and dick cheney's in there saying we're going to be greeted with flowers. chris: i think a great part of it was the cost benefit analysis, we all would like to get rid of saddam hussein and the cost wasn't much. twob like eastern eure. they all agreed and that explained a lot of it. ld wou be a cakewalk. but -- >> but there wasn't a satisfying conclusion how long we were and

how wrong we are again. we're not good at anticipating costs. when we come back, scoops and predictions from the top reporters.

chris: welcome back, bob, tell me something don't know. >> the search is on for a new secretary of defense. gates has agreed to stay on until july. obama would like him to stay on

forever. but they're trying to develop a case for, you know, who's most like gates? had experience in government, is calm, has some political experience in the white house, number one candidate? chris: exactly. >> leon panetta. chris: really? >> absolutely right. chris: head of intelligence. >> in '72 but it was until '83. chris: any chance for secretary clinton to move up to defense? >> there are chances. it's not decided but i think panetta, i think chuck hagel, former republican senator is on the list. chris: the thing with panetta has that's really important here is he's a budget cutter. he has a history of budget cutting and that's what the job is all about. chris: that's what we thought cap weinberger would do, remember, cap the knife. >> one othe big reasons i think been overlooked in egypt

is the role corruption has played and particularly since the financial crash. people have said to me when time got really hard with unemployment spiking and food prices going up and the financial crash, people started thinking things are really bad economically and you're still stealing from me. and the corruption got that much worse recently. >> you probably know this already but i hope not. the white house is really happy with the bill daley era so far. they feel it will go really well in part because he doesn't like leaks and he was very unhappy with leaking that came out around the state of the union. especially the speech seeking. but they're happy in part because they're getting some of the personnel deflections dealt with. chris: speaking of leaks, there was a lot of damage from the wikileaks. the reports were untrue and the white house and the state department are convinced that the chinese and other countries have hacked into julian that sangia's stash and are now going through the cables and seeing who talked to us and are going to put people in jail. chris: i'm stunned because the

biggest thing that came out of wikileaks is the chinese government wanted to unite the korean peninsula under seoul. an astounding bit of information. when we come back, the big question of the week, in the will barack obama win? packers and steelers.

chris: welcome back. our big question of the week. in next year's super bowl, that's 2012, it's a presidential election. will barack obama win the packers and the steelers? the men and win of the industrial states from scranton to oshkosh as he did in '08. bob woodward, how does it look for him in the industrial states, the president? >> that election is so far away actually, some of the things that we're talking about now may not even come up in the election. chris: a little more nervely than that? we're asking for predictions here, not -- >> i think it will depend to a large extent what the unemployment numbers are looking like. and particularly the unemployment numbers in individual states. but these are conservative states that went for obama in a fairly surprising way.

>> they're both right. it will be hard. that's why you saw obama go to wisconsin the day after the state of the union. you will see him make more trips. chris: penn state this week, too. >> why north carolina, i don't know. chris: we don't get that part but stay in the industrial midwest. what's the situation politically? >> much, much worse for obama than before. it's going to be closer. chris: how can he carry wisconsin, indiana and ohio? he needs them all. >> create jobs. chris: i agree with you. thanks for the great round trable. katty kay, joe klein. that's the show. thank you for watching.