but steady improvement. a lot of talk over the weekend, friday, about the economy starting to move in the right direction. obama kind of cautiously starting to take krcredit with e stimulus package but i, for one, am still concerned because the consumer is not onboard. we talked a lot about this but first let's get to the news. >> it's time for a look at today's top stories. the military says it has identified the remains after navy pilot shot down in iraq during the first persian gulf war. the pentagon says an iraqi citizen led marines to the gravesite of captain michael speicher. the very latest, ron, what are you hearing? >> reporter: hey there, willie, good morning. captain scott speicher's name has been on the wall here for some time now. the family got some resolution in his case. it came over the weekend.

while it wasn't the news they really wanted to hear, they hoped and prayed for, it is a sense of closure, a sense of comfort knowing the search is finally over. this has been an ordeal 18 1/2 years long for this family and this community. he first went missing in 1991, the first person lost in the first persian gulf war. his plane was shot down out of the sky. he was initially declared killed in action by the government but four years after in 1995 when the military found the wreckage of his plane but no body they told the family they would reclassified him as missing/captured. that lasted for quite some time. there were rumors and speculation. none of that resulted in a body or scott speicher until a month ago. there was a search in the western provinces in eiraq. they dug in through the sand of the desert and found remains. they later identified those remains to be captain scott speicher. he will make his way back home

to a fallen hero's welcome. >> what do we know about the person who led the marines to this gravesite? why now 18, 19 years later? >> reporter: a lot of folks are crediting the stability now in iraq for people coming forward. the government only suspected. obviously there were people who knew something. this particular individual told military officials he was part of the group who came upon the body of michael speicher and they buried him there in the sand. little did they know they were solving an 18 1/2-year mystery because the government never acknowledged that he was dead. the saddam hussein regime never acknowledged that he was dead. maybe they didn't know it. no one really knows. still a lot of questions this family will be asking particularly if they found evidence that he ejected from that plane. did he land safely? was he actually captured or was he killed upon impact? willie? >> you get the sense this is only the beginning of the story. ron mott, thank you for bringing

that to us. the u.s. is calling on the swiss government to help with the release of three americans now in iranian custody. sarah shourd, shane bauer and josh have a faftal hiked across the border. the state department is in contact with the hikers' families but they do not know where they are. >> you might want to just not be -- the families want them home safe but places to maybe not hike. >> the alaska trail. >> the rockies are always available. also in iran the supreme leader endorsing mahmoud ahmadinejad as president even as protests continue. the ayatollah's blessing clears the way for ahmadinejad to take the oath of office before parliament on wednesday. the obama administration says it will suspend the cash for clunkers auto rebate program unless the senate provides billions in additional funding. despite the program's popularity

there is still some debate over whether it's a sign of economic recovery or more government intervention. >> the role of the federal government is not to run the useded car business. it's clear. you can look at amtrak and the mail business, the federal government went bankrupt in one week in the useded car business and now they want to run our health care system. i just think this is a great example of the stupidity that's coming out of washington right now. >> there is no doubt that very extraordinary response that we saw is a very important indicator that the state of incontinence in the economy is beginning to pick up. if the clunker program had been put in place six months ago, it would probably have been a dud. >> is this a good plan or sort of a blip? >> wah-wah-wah, even when it works. what i like about this, it's

creati creative. it got people walk to go showrooms. it's a jump-start. this is not tens and tens of billions of dollars. i like this a lot and i think there's an incentive attached to it. >> you know, i keep on coming back to the fact that the people who drive clunkers are people who couldn't be buying a new car. that's why they're driving clunkers. >> the incentive to clean up the economy. this is not just bringing -- >> you can't afford a new car, you're driving a clunker, the government gives you some money. >> any incentive from a car dealer, somebody can't afford a car. joe scarborough, wow, look at that! out of nowhere. >> i've been sitting here all along while you've been debating. whm i going to be able to get into this? you know what i like about it, though, it is money goes straight out to the people. that's actually if you support a stimulus plan. >> this is stuff that's really

working. obviously we have to be careful. >> people are going into debt. >> maybe for $1,000 instead of $3,000 and $4,000 they'll come into the showroom. >> we have to test the elasticity, i was just saying. >> in the smoking lounge. >> i was. while we were touring north korea. >> exactly. the white house is offering an optimistic outlook when it comes to the nation's recovery. treasury secretary tim geithner is not prepared to take any options off the table. >> the president has said taxes won't go up for any americans earning under $250,000 but it doesn't appear he will be able to keep that promise if we're going to bring the deficit down. >> we can't make the judgment about exactly what it's going to take. >> revenues are on the table as well? >> we're not at the point yet we're going to make a judgment about what it's going to take. >> but you're not ruling it out.

you can't rule it out. >> i think what the country needs to do, we have to do what it takes, what's necessary. >> all right, joe, so we heard the promise on the trail, no tax increases for the middle class and now six months into the administration they're starting to talk about it. >> well, we'll see. they're not going to take the option of the table. if there is a middle-class tax increase then that's going to be damaging to democrats running in 2010. you can debate the economics of it all day long and we could, but just politically. they're piling too much on top of these democratic candidates right now to take moderate states and take moderate businesses. >> when they say we're not going to take this option off the table, it's almost like they're trying to slowly manage people's expectations. >> they're hoping what every politician hopes.

i will say if barack obama is asked the next press conference will you make the pledge, read my lips no no taxes, and then the president stammers around and keeps it on the table, that causes him political problems. if i'm robert gibbs i try to keep him away from reporters for quite some time. >> there's also been, joe, a lot of jubilation about the economy. i would like to put a big red flag out there. >> why is it that i'm hearing how great things are becoming and every person that you know and i know who has lots and lots of money, money sitting on the sidelines, the money that has to get poureded into the game before this economy takes off are all saying they're more nervous today than six months ago. gee, we don't know where the bottom is. >> the fundamentals starts with the consumer. there were some great numbers on monday. the gdp 1% versus 6%

contraction. when you look at the consumer, spending was down 1.2%. consumer confidence dropped from the month before 3%. i think and i've said this all along the consumer psyche is permanently damaged from this and it is not going to come back soon. i don't care whether you're relatively affluent or somebody living month to month -- >> i have to stop you there. you say permanently damaged. i say permanently healed. >> i mean for the economy. >> the good news is the consumer had a zero percent savings rate last september. we are up to 7%. >> and we'll keep growing. that's bad for the economy. good for 20 years down the road but for people waiting for the circus to come to town. >> that's bad for the economy 1992 to 2008. that's great for our economy in the long run. >> long, long run. >> this is america regenerating itself and it does require us to press the reset button and say

70% of our economy is no longer going to be driven by consumer sales. this is bad news in the short run but this is like somebody who is -- >> there are healthy things emerging, like you're saying. but there's this unemployment rate that's not going away. it could actually worsen and when you're unemployed or lesser employed than you were and your neighbor is unemploy, your behaviors will change in ways that are not good for the economy. >> listen to this story. an unemployed new york city woman is suing her college alleging her $70,000 tuition was a waste of money. the 27-year-old says monroe college failed to provide the promised career advice and job leads and she wants her money back. >> you know what she should have done. gone to the university of alabama. great school. look at me. >> these private schools -- >> i come to work whenever i want to come to work. >> just take responsibility for your life.

>> jack welch mba. >> very overrateded degree. >> unless you need an entree to special investment banks, as far as i'm concerned -- >> that's not true, donny. i learned so much. >> you need a law degree, weather. we have bill karins. a man of many letters. >> you could have said you don't need a ba you need a bs to do the weather. >> you could have said that. >> i could have. >> so what's going on? >> extremes. we have all the numbers together for july. and in case you thought it was kind of cool and wet and a crummy summer in many areas it has been. anywhere you see the blue dots on the map it was the top ten coolest july you had on record. you notice the yellow dots on the bottom by texas, that's the top ten hottest. it was a month of extremes. august starting off the same way. more wet weather through wisconsin, down towards

milwauk milwaukee. maybe a shower or two in chicago early today but this afternoon will be pretty mild. 84 in chicago. big cities in the east, a three-day period of summer before we cool it off. today 85 in new york. d.c. at 88. the only chance for rain is orlando. look at the drought. dallas to san antonio. dallas, this is going to be a brutal week. four days in a row of 100-degree temperatures. by friday we drop it down to 9. no rain and no clouds at all that drought in texas gets worse. all the rain from yesterday in the big cities 95 is gone. it's going to be a dry morning commute for you and this afternoon should be gorgeous. temperatures in the mid-80s. all in all a pretty nice start to our week, guys. >> thank you so much, bill. we've complained about the cold weather. i'd much rather have the blue dot than the yellow dot. record highs in texas. i bet that was comfortable.

yikes. if you live in manhattan, you think al gore's theory on global warming is a bunch of bull. if you live in texas, you're embracing it. >> unless you're an upper west side liberal in manhattan. >> there you go. we have a great show this morning. host -- well, i don't know if this is great. we need the stun gun. dylan ratigan will be here. bloomberg's washington editor al hunt. "vanity fair's" vickie ward. she wrote about bernie madoff's new multimillion dollar yacht. also the headlines out of the white house with savannah guthrie. plus, politico's top three stories of the morning. what are they? ( conversation ) garth, you're up.

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glad you're here. what a crowd last night.

couldn't really blame them of the the show was awful. did not go well. i get a call from president obama and he said i acted stupidly. everything's okay now. president obama has invited myself and sarah palin down to the white house for a beer. >> editor of politico jim vandehei. how are you doing? >> we're doing great. very excited for the fight that's about to take place. we had nancy pelosi the other day calling insurance companies villains. how is this going to play out? >> i think the big flash point during the august recess because the insurance companies which as you just said nancy pelosi called the villain in this fight, i think are finally going to start fighting back. they're trying to work from behind the scenes to shape a bill that doesn't completely destroy their industry. they're saying now they're going to spend a lot of money. some of it on ads, some organizing getting people out to

town hall meetings and to push back against the idea of a public funded option for insurance and that is going to be the big fight both in august and then september when they try to put the bill together and the question is whether insurance companies can change their public image. if you look at the polling, a lot of the public thinks they're the villain, too. >> everyone always thinks they're the villain, don't they? >> it's like gene robinson said on friday, it wasn't smart politics from her. that's just not a good move going after the industry that took bill clinton down in '93-'94. i will say, too, you stack up the number of people pleased with their insurance, health care insurance, compare that with nancy pelosi's approval ratings and the truth is the insurance companies' numbers are higher than nanny pelosi's

rating. i would ask nancy to go to san francisco and talk about people's v.a. benefits. >> these insurance companies employ people and there's all these employees whose life depends on working for these insurance companies. they're proud of what they do. as soon as you start vilifying everybody, you're in for a big fight. >> she has to start disappearing a little bit. i like nancy. >> i do, too. >> she should not be selling anything right now. if i'm barack obama to your point, put her aside for a while. >> were the media have highlighted it if she were newt gingrich? sarah palin, dick cheney, nancy pelosi. >> i'm going to say pelosi and cheney a dead heat. >> pelosi is the lowest. dick cheney's outside the margin of error.

if you consider those are daily punching bags for democrats and the american press and yet they have higher approval ratings than nancy mosey. you were there when newt was running the house. >> that's why a lot of moderates wish she would disappear in some of these fights. i think if you look at the polling numbers, republicans almost to a "t" dislike her. a lot of independents dislike her as well. she's probably more polarizing than the last time we had this health care fight and that is pretty extraordinary. democrats would much rather have the individual member be the face of this debate rather than nancy pelosi or barack obama. >> exactly. and then she amps it up by calling insurance companies villains. >> it's not going to work. >> on pelosi, we interviewed her and asked her about the very thing, she said i don't care if i'm not popular.

she cares more about is she popular with her colleagues. she has power newt never had in the '90s. she runs the house with an iron fist. that's what she cares about as speaker. the trick for her she is never going to become miss popularity. she has to figure out a way to control the house, lower her profi profile. >> the only problem with that, though, is if you are that unpopular at some point the members wake up like we did and look at everything we do is going to be tainted by newt's low approval rating. we could have had a plan to give everybody $5,000 and it was newt gingrich's scheme to pack your wallet. stop it. everybody was scared. i'm sorry. what's the next topic? >> even as the white house tries to sell health care, they're out trying to push the narrative that the stimulus is working. what's the latest strategy? >> well, for the first time both

are going to go out and do different events talking about the same issue, the stimulus. they're going to try to make the case the stimulus is working and it's one of the reasons you have alan greenspan and others saying that you might start to be seeing the light at the end of the tunnel, the economy might be recovering. they also look at the polls and see people are very uncomfortable with the amount of money they've spent. the public has paid a lot of attention to the stimulus and knows the bulk has not been spent yet. even if the economy is recovering, is the stimulus really the reason for it? so they want to make that case and get some political capital or gain from the stimulus and the economy starting to rebound if, in fact, it is rebounding. >> we don't see the two of them out together. >> i was surprised how bold obama was, pretty much taking credit saying the stimulus is working. we all know it's so early on and most has not been put to work. i would have tempered it a little bit more. i hope those words don't go back

to bite him. >> it's a risk. >> i would have hedged it more. >> i don't know americans are feeling that. hey, jim this last topic, this is not a story we'd ever do, the ram blblings of a left-g blogger, but sarah palin answered it. >> for a long time sarah palin has gotten in fights with bloggers especially in alaska. over the weekend a blogger who goes by the name grifen, who does not use his own name, describes himself as a 49-year-old guy in alaska, reported on his blog that probably has about as many readers as our internal newsletter does that there could be a divorce, that sarah and todd palin are going to get divorced. the palin camp put out a statement denying this and saying you should retract it, it's not true. then everybody else picked up object this item and turned it

into a story when it should have been nothing. >> what's bizarre is she is falling for this stuff. >> i don't blame her for responding. i disagree. this is how it started with her daughter's baby being her baby. it started in left-wing blogs, very quietly, and then it grew and grew. she said i'm going to get out in front. look, you can't win. >> i think about this a lot over the weekend. i've gone after her hard saying it starts with her sex appeal. i personally got excited when i thought she was going to get divorced and i would like to right now say if she is ever sickle i would like to take her on a date. i mean that. i got in touch with my feelings. >> now she is definite guy did go to get a divorce. >> i'm not being glib here. i all of a sudden went from going after her to getting excited. i'm going to ask her out if she's ever single. i'm being serious.

>> is he joking? >> no, he's not joking. >> you want to date sarah palin? >> if she were single. >> i hope she's listening. >> this is terrible. >> no, i got in touch -- >> is your screen name griffen? >> we are sorry. >> it's good. >> politico, serving america for almost -- this is one of the dark days for you. i'm very sorry. >> i didn't start this fire. >> jim vandehei, we'll see you tomorrow if you'll come back. >> i thought you were inappropriate when mika was here. michael crowley explains the meaning behind cheneyism and who is running in foreign policy. we'll look at the must-read opinion pages. yes, mika has faxed them in from

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welcome back to "morning joe." 6:31 a.m. in the big apple. >> be able to show america's

gems without having somebody here mocking it. >> i'm sure she's critiquing this live shot wherever she's sitting right now. >> you're going to have great variety coming. >> we have some for you. >> no, no, i've got some ideas. >> the great cities in the u.s. >> fair enough. >> i like it. time for a look at some of today's top stories this morning president obama is honoring a united states navy pilot whose remains were found and identified in iraq after nearly two decades. the pentagon says an iraqi citizen led marines to the gravesite of captain michael "scott" speicher shot down on the opening night of the gulf war. >> you've been seeing those pictures for so long, little kids, they're in college now. forget how much time has elapsed since the first gulf war. >> that's right.

>> i know that has to be a relief, though, for the family to finally know. it was actually an act of human kindness in 1991. a random act of human kindness that kept the mystery alive for so long. coming along, finding him, and giving him a proper burial well,neighboring iran, three hikers are being detained after straying across the border. >> this is a random act of human stupidity. >> sarah shourd, shane bauer and joshua fattal were taken into custody. now diplomats are working to find where the group is being held. >> honey, do you want to go hiking in yellow stone or up the appalachian trail or summer on the vineyard or we could hike in iran. >> you want these people to come home safe but how many

taxpayers' dollars are being spent on this act of daring. who knows, millions -- i bet more than a million dollars. >> it's like the politics to come out of it. >> willie and i went four-wheeling back in '87 in north korea. whew. that it didn't turn out well either. >> that summer trip to somalia. >> i know. and this morning's "new york times" is reporting western intelligence officials believe they have proof that venezuela has been aiding farc, colombia's largest rebel group t. comes despite denials hugo chavez froze diplomatic relations with bogota over those claims. >> this is a story, aiding farc since who knows what? on the house floor and delehunt, do you want to go to colombia?

he's doing it just to get under my skin. i can introduce you to the rebels in the mountains. >> you love him. let's get a look at -- >> which wiillie geist, i think said. let's go through the morning papers. willie, the paper you wake up to every morning, "the washington times." >> geithner, hummers hedge on tax hikes, a way to pay for sweeping health care reform. >> that is a strange headline. "the new york times," two sides take health care debate. democrats focus on insurers. gop highlights cost. how about the "usa today," joe. stimulus cash. according to the bureau of economic analysis, the funds helped reverse six months of spending declines offsetting a big drop in tax revenue. >> happy days here again. "the washington post," 18 years after being shot down in iraq,

pilot's remains are found. also in "the washington post," new detainees site in u.s. 20 house prisoners from guantanamo bay. >> "the detroit news." michigan may get gitmo inmates. the paper, levin says the maximum security prison is being considered as if things aren't going bad enough. >> you don't remember this, willie, but guarantee it others around the table, bill clinton lost his first re-election as governor. do you remember this? jimmy carter decided to send some prisoners from cuba that had just come to america to arkansas. bill clinton said, i'll take him. what do we have next,

willie? >> up next, michael crowley in studio with us. >> he's terrible. he's terrible. turn your channel. no, he's got a great article on who really runs u.s. foreign policy. >> he does. be sure to sign up for your "morning joe" text alert, find out about upcoming guests. text joe 622639. that's also joe's atmp.i.n. code. at 155 miles per hour, andy roddick has the fastest serve in the history of professional tennis. so i've come to this court to challenge his speed. ...on the internet. i'll be using the 3g at&t laptopconnect card. he won't. so i can book travel plans faster, check my account balances faster. all on the go. i'm bill kurtis and i'm faster than andy roddick. (announcer) "switch to the nations fastest 3g network" "and get the at&t laptopconnect card for free".

and i can make a firm pledge under my plan no family making less than $250,000 a year will see any form of tax increase. not your income tax, not your payroll tax, not your capital-gains taxes, not any of your taxes.

>> read my lips. no new taxes. hey, let's bring in the senior editor of "new republic" michael crowley. if my treasury secretary went on a sunday morning show and said, no, we will never raise taxes, when he came back to the white house i would say, dude, you know. that doesn't invite the next question. you're going to say do you keep your pledge you made in september of last year that you will never raise taxes. he said pledge. do you think for 95% of americans? >> bill clinton promised a big middle class tax break.

i think the parallel is valid here. clinton said we don't know how bad the economy could be. i was operating on a set of assumptions that turned out to be wrong. you heard that several times from both geithner and summers in their appearances yesterday not specific to the tax cuts but generally to unemployment, economic growth, what their line is more than anything, we didn't know how bad this was going to be. we kept the country from going off the cliff economically but it's worse than anyone told us so cut us some slack. >> their messages are mixed right now. message number one, the economy is turning around. happy days are here again. the second one, hey, this is a lot worse than we thought. i will say, though, brilliant as usual, it is like bill clinton, new hampshire. he was hounded by scandal. he got out of it by promising the middle class tax cut. and then three weeks after he got elected tax increases. we're not talking economics.

we're talking politically that this would be a nightmare for moderate democrats already scared of what they're going to be facing in 2010. >> sure, sure. i think that you're having these third -- >> again, let's just underline we're not saying that president obama is going to raise taxes. >> right. >> however, the door was kept open yesterday. >> the door was kept open and we have a big deficit problem you talk all the time on the show and you do have to wonder how we fix it because bending the cost curve for health care if that does it, it's going to take a long time. >> right. >> and we probably don't have the luxury. democrats are taking tough votes, environment regulatory. now health care, attacks on health care management and now tax hikes. these are all these issues democrats have been terrified of. thanks to the way republicans made a total hash of america's role in the world and the iraq war. some of the bread and butter

issues that republicans like to be attacking on and are start to go congeal. >> i've had friends telling me to run in 2006, 2008. i said don't, don't. republicans, don't do it. don't do it. don't do it. because it's going to be a horrible year. i said that a year out. now somebody says, hey, should i run? dude, run twice. the democrats somehow think and we all make this mistake. new politicians all make mistakes. our guy gets into office and we think the rules of politics have changed forever. they haven't. this is so much like '93 and '94. >> i can't believe we're debating whether or not taxes are going to go up. the deficit coming down the road, health care, there's no way to close the gap. we're debating it. >> he's going uptown. >> it is suicide. it is political suicide.

>> mark pen who was around when bill clinton tried to do this in '93 and '94 realizes and he wrote an article, i think it was in "politico" last week you can't just tax the rich and think that only the rich are going to be angry with you. they found in their polling middle class americans were offended by taxing the rich because everybody wants to be rich. >> i don't buy that. >> tax the job creators. >> that's a different discussion. clinton raise taxes on the rich and the economy took off, partly because of the budget. the economy didn't fall off a cliff. the money came from the rich. >> i got elected in 1994 because of bill clinton's tax increase in 1993. it was that simple. >> in the immediate aftermath but medium turn --

>> we cut spending. '95, '96, and '97. actually i'm joking. you know what happened was -- what happened was we both were responsible economically and the economy turned around and the dot-com brought us out. >> obama had four ceos, he wouldn't buy them lunch. they had to put their own credit cards down and pay for their own ham sandwiches. that's what he thinks about the wealthy in the country. >> the white house needs to understand a lot of really, really wealthy people across the country did vote for barack obama but he does not own them. there are a lot of -- and, donny, you know a lot of wealthy democrats that are saying what did i do? >> they got dragged kicking and screaming. they didn't have a choice. >> they were embarrassed to vote -- let's just say it. they were embarrassed to vote for a sarah palin on the ticket.

they were embarrassed of george w. bush. culturally there was a disconnect. they couldn't do it. i will tell you what -- >> your girlfriend. >> if the democrats thought that they would own the wealthy in america, obama, as you know, obama carried the richest americans by about 6%, 7%. >> i'd like to think they're not all motivated by economic self-interest. they say, look, i have enough money to help this country out. you can tax me a little bit. that's the truth. >> i have friends and i have super wealthy people who say i can afford to do it. it's the wealthy. >> let me tell you something, if, michael, seriously, if you're looking at your rate 35% and it's going to go up to 39.6% because barack obama says that we're going to repeal the bush tax cuts, okay, well, that's what it was like under clinton

and then they had a 5% surcharge. so now you're up to 45%. at the same time new york city or l.a. increasing, at the same time the locals, the counties, sudden suddenly this is 50% of your income. >> those tax hikes are margial, your income over a certain level. you're hitting income above and beyond a pretty good chunk of change that allows you to live your life pretty well. >> people who made a lot of money, they realize that's not good for them and the economy. every time i was in office and we started talking about tax increases, you'd hear a lot of these guys, not the super wealthy, a lot of the guys that have built their businesses and women saying, you know what i'm going to do? i'm going to retire to nantucket. >> i don't buy the disincentive. >> you don't think raising taxes is a disincentive?

>> if you're a worker and you want to make money. >> michael will be with us through the top of the hour. he's not supposed to. michael, bye. good having you here. >> he tried. >> by the way, michael has a great article in "the new republic" about who runs foreign policy. one-word answer, who runs it? >> barack obama. to an amazing degree. tools are uncomplicated?

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tiger woods was terrible. what did he do over the weekend? fred has the highlights. thanks and good morning. the words ruckus and golf don't go together. they sure did yesterday at the buick open. outside of flint, michigan, does that look like a golf crowd to you? shaking the stands, shouting players' names. a man in a neon green body suit. a crazy day at the buick. as for the final round it belonged to tiger. on 4, a long putt for bird. nailed it. tiger simply got it done. with a three-shot lead on 18 woods hoping to give the crowd a reason to roar. looked good but lipped out.

no matter, he won by three. baseball, in chicago white sox and yanks. first inning cabrera took mark buehrle deep for a three-run homer. fourth inning cabrera struck again deep to right, over the head of the hapless jermaine dye. an innocent double. here is why it mattered. he singled in the fifth so in the ninth he needed a triple for the cycle. another drive to right and to the wall. melky was on his horse all the way to third. completes the cycle. new york won it 8-5. they hold on to a half-game lead over boston in the a.l. east. reds and rockies. may john march can i plunged rolen down. he was able to walk off on his own power. rockies beat the reds. the men's u.s. 4 x 100 team put on quite a show.

michael phelps opened up the lead. a new world mark. the u.s. finished in style. for phelps his fifth gold of the championships. finally back to baseball. it's a known fact if you're a rookie a you're going to get teased by the veterans. sometimes you're going to get embarrassed in public. during the red sox/orioles game josh beckett distracted rookie george, john smoltz placed bubble gum on his cap. he never knew the difference, trying to fit in, gain knowledge from the guys in the dugout. all they could do was laugh behind his back. after a few more minutes, he realized what was going on. all i can say, george, don't let them steal your suitcase. that reminds me of the time i put salt in willie's coffee. let's just say he spit it out. his computer screen never the same. you guys have a good monday. >> that was a good laugh, fred. those red sox. coming up next, news you can't use. why is vladimir putin leering

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time for some news you can't use. russian prime minister is a man who likes a good adventure. we've all learned that by now. >> he is sort of a hemmingway of russia. >> he likes to get out and do his thing. >> over the weekend he took a mini sub on a dive to the deep

est lake. he went down 4,600 feet. there he is. i don't know why that shot of him staring out the peephole is so strange. niece there solo. dives down 4,600 feet. he wanted to examine some of the most beautiful flora in the world. >> that is dangerous but nothing like hanging out with tigers. he doesn't do that, does he? >> sometimes he'll go tiger hunting in siberia. a lot of the journalists, this is true, were worried about being so close to putin with a gun in his hand. the strained relation shship. >> you say strained. there are reports he actually killed journalists. >> that's what i was getting at. how about his recent martial arts video. >> this guy is living big. >> this is called judo training with vladimir putin. he's a black belt. who could forget his topless

fishing trip. there he is. >> looks like colonel jack jacobs. how old is he? >> probably 53. >> he's an adventure man. >> kgb guy. >> we love building implosions. it's up if to watch. this is turkey. this is a flower factory. >> no! >> and then it rolls over. just poor execution. >> no one was killed in the making of that. >> that's unbelievable. >> what you want to do is put the charges in the bottom of the building and have it fall on its footprint not topple over. >> can we see that again? that would have never happened. >> the full revolution on the

top. it's the top of the hour. it was quite an eventful weekend. timothy geithner and larry summers going on the sunday shows, not closing the door to new taxes for the middle class. the two economic wizards for the obama administration also telling us happy days are here again. in "the washington post" lee on panetta telling democrats and republicans alike that when it comes to the pesky cia programs it is time to move on. we're going to be talking about that and much more. first, here is willie geist. he's got the news. which wi willie? >> we are following a breaking story now. live pictures from miami where continental airlines flight 128 was forced to make an emergency landing this morning. the jet was en route from rio de janeiro when it was diverted because of bad turbulence. according to fire department

officials 26 people treated for injuries, four of which we're hearing considered serious. >> evacuate add couple days ago here in new york. >> they thought it was a suicide bomber. >> people hospitalized for turbulence, that is serious turbulence. >> we're still getting information on this. the u.s. military says it has identified the remains of an american navy pilot shot down in iraq during the persian gulf war. they say they led marines to the gravesite of captain speicher missing for nearly two decades. the u.s. is calling now on the swit government to help with the release of three americans in iranian custody. sarah shourd, shane bauer and joshua fattal apparently strayed across the border while hiking across iraq. >> it happens. >> the state department says it is in contact with the hikers' families trying to find their whereabouts.

also the supreme leader endorsing mahmoud ahmadinejad as president even as protests continue over june's election. the ayatollah's blessing clears the way for ahmadinejad to take the oath of office before parliament on wednesday. >> and iran started the show trials this weekend with new leaders of the opposition declaring them. >> keeping an eye on it. the white house is offering an optimistic if cautious outlook when it comes to the nation's economic recovery. although the recession appears to be easing treasury secretary tim geithner is not prepared to take any options off the table. >> the president has said taxes will not go up for any americans earning under $250,000. >> again, we can't make these judgments yet about exactly what it's going to take and how we're going to get there. >> so revenues are on the table as well. >> again, we're not at the point yet we're going to make a judgment about what it's going to take. >> but you're not ruling it out. you can't rule it out. >> i think what the country needs to do is understand we're

going to do what it takes, what's necessary. >> donny, you said rich people don't mind if their taxes get raised more, that you don't think it will be damaging to the obama brand? >> rich people are not happy. i'm saying i don't believe -- i think it's political suicide talking about this. >> you don't think it is. >> i think it's political suicide if he raises middle class taxes. >> soak the rich but leave the middle class alone. >> they will get destroyed. it will be political suicide. as you said economics aside we all know decisions sometimes are made politically. >> especially if we play that september speech the president made last year making a pledge not to raise taxes for the middle class. i don't think he can go back on it. >> the obama administration says it will suspend the cash for clunkers rebate program unless the senate can provide billions in additional funding. despite the popularity there is debate over whether it's a sign of economic recovery or just

more big government intervention. >> the role of the federal government is not to run the used car business and it's clear. you can look at amtrak or the post office and now cash for clunkers. the federal government went bankrupt in one week in the used car business and now they want to run our health care system. i just think this is a great example of the stupidity coming out of washington right now. >> there is no doubt that very extraordinary response we saw is a very important indicator of the state of confidence in the economy is beginning to pick up. if we had been -- if the clunker program had been put in place six months ago, it would have probably been a dud. >> suzy welch, if you're going to stimulate the economy, this is the way you do it not through bureaucracy. give the money straight to the people, let them make economic choices. a lot of republicans don't like this program. what about you. >> there are some real problems.

what we're doing is having a little mini housing crises where people who couldn't afford to buy houses were helped to buy houses. now cars are not as ex pebsive as houses. you have people driving clunkers because they can't afford to buy new cars. given money by the government to go out and get themselves into debt again. i think that's a problem. yes, people went to the showrooms and, yes, it looks like there's movement but maybe that's happening because consumers, american consumers are habitualized to spent money. it's been a long time since they've been able to spend money. >> the banks are not lending money to pretty much anybody, particularly people with bad cred credit. i don't think this is dragging the down beat. i think these are people -- this is a quick incentive in which i said earlier car dealers have been using for decades and decades and it's cleaning up the environment and i think the reason republicans don't like it is it's working. it's as simple as that. >> i wish that were true.

you have to give republicans a break. >> donny won't give them a break. all he will do -- he is so tough on republicans that he is helping sarah palin get a divorce. >> that's the last thing -- >> not for political reasons. >> if by some chance that were true, i would like to take her out. >> so you are -- there's no doubt you were banking for a divorce which i think explains this headline here, "the new york post," says it is time for a sexism summit and i think we should have a sexism summit. i think we should have a sexism summit with the feminist leaders across america and donny deutsch on stage in a cage. >> she brought up an interesting point. we kind of elect good looking. if you go back to every presidential election since kennedy, the better looking guy has won. this is the first time we've

seen a woman in power who looks like this. >> barry goldwater was a looker. >> he and lbj. >> there's a likability factor you're wrapping up with sexism here. >> i'm just being honest. i think she's an incredibly appealing woman. not to vote for. if by some chance she is single, i'm going to be first in line. >> you're going to be in a fight. >> i'll take them on. >> liberal guys like sarah palin. i just can't figure it out. >> she's hot. she'll protect your cubs. >> stop it! >> it's like cave woman. >> shut up. just shut up. you are so inappropriate. when you say that about mika, you know, we don't have to answer the questions from -- >> did you hear william shatner doing a -- unbelievable. that is one of the greatest. >> let's get out of this

territory. you have offended us for the last time, donny. >> you have defended sanford, the only scandal truly out of love, so why can't you do the same here? >> i just don't like the -- i'm just going to stop. willie, what's next? >> well done. let's talk about the economy. the big financial guns were out on the sunday talk shows yesterday. tim geithner was out on abc, larry summers on "meet the press" with david gregory. geithner saying we've stepped back from the brink. we have avoided collapse thanks to what we've done. >> the financial system today is more stable. the costs to credit, credit is more available, down significantly. broad concern about collapse of the financial system has receded dramatically and that is very, very important to the prospects of recovery.

>> very different place than we were. six months ago the economy was in a nose dive. people were talking about the possibility of another depressi depression. the statistics suggested a vertical decline. none of that is the situation right now. we're certainly starting to see a turnaround. we have walked back from what we were facing six months ago and that is because of the policies that were put in place. >> joe, obviously a concerted effort out of the white house. is it working? >> all the polls are showing that americans think -- more americans think that economic policies hurt than help the economy. we saw the poll last week. this is dangerous, really dangerous. ronald reagan said a recession is when your neighbor doesn't have a job, a depression is when you don't have a job.

unemployment rates are still going up. here's the danger, it smacks of john mccain september 15th, 2008, the fundamentals of the economy are still strong. when you try to push americans into believing things are better than they are when they don't have a job, this is dangerous politically. >> how obama was taking half of a victory lap. as i said earlier, the consumer is still beat. consumer spending down. consumer confidence down. this is the first inspired recession. the math is not the same. unemployment is a lagging ibd kator. i don't think so in this case. as you said earlier every smart business person i talked to said this is a head fake and the last thing we should be doing is a victory lap. >> eating burgers at martin's and opened up the local georgetown papers, all bad news

regarding real estate. one person saying six months ago i told you don't panic. now panic. who would have ever believed in a place like georgetown the shops would be shuttered. it is horrific news. and if that's happening in georgetown, what's happening in akron? what's happening in youngstown? what's happening in ypsilanti? i can tell you in my hometown of pennsylvania, my god, people are just barely hanging on. people who thought they would have jobs forever are just waiting for something good to happen. >> kids are not going back to college because the parents can't pay. people are going into stores and seeing the deep sales. kids are not getting jobs or are graduating from prestigious schools. people are feeling it and then hearing this mixed message of hearing the economy is getting better but we might have to raise taxes and i think it is -- that's the mixed message. >> if he ever wanted to go back

ala krugman for another stimulus, he's kind of put himself in a box. he can't go with his hands out anymore. >> that's the problem with this health care plan that's turning out badly for him. you can't also say down the road, the economy is much worse. we need to raise your taxes. people say, wait a second, already raised our energy taxes. you've pushed this health care plan that's not even going to get 47 uninsured. you've done all of these things. wouldn't is have been bettory take care of the economy and the deficit before trying to take on the rest of the world and now you're coming to me with a bill? i'm not paying it. >> a lot of problems. if the economy turns around, it's amazing how quickly it turns. we remember '92, '93, '94 when it turned around. we'll see. who knows, will "vanity fair's" contributing editor vickie ward, she knows. i don't know if she does.

it's the best we have. we have bernie madoff's new multimillion-dollar yacht. other than donny deutsch who is selling it on the high seas? dylan ratigan and bloomberg's al hunt. first the morning headlines out of the white house with nbc news' chief white house correspondent, because we say she is, savannah guthrie. you're watching "morning joe." i've been growing algae for 35 years. most people try to get rid of algae, and we're trying to grow it. the algae are very beautiful. they come in blue or red, golden, green. algae could be converted into biofuels... that we could someday run our cars on. in using algae to form biofuels, we're not competing with the food supply.

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we're going to keep working to strengthen the foundation -- the foundation of this economy. there's a lot that can happen over time but the priority right now, never a good idea to absolutely rule things -- rule things out no matter what.

>> welcome back to "morning joe." with us now chief white house correspondent because we say so, savannah guthrie. great to have you here. i'm glad you disposed of chuck todd over the weekend and now running nbc operations over at the white house. the headline it seems out of this weekend, a couple of headlines, let's start with the first one, economic advisers. first, we're not closing the door on raising taxes on middle-class americans. is the white house going to be responding to that today? >> reporter: i think we're going to hear a little pushback on that or what they would say is clarification of what the treasury secretary meant and, in fact, what you played from lawrence summers is part of that. geithner was pretty clear saying we can't rule out anything. if you want to get serious about deficits you have to look at revenues be a wouldn't rule out the idea of a middle class tax hike. summers said that's not exactly what they're looking at and the president would be unequivocal about it. there is just no way he can go back on that pledge, the central

tenet of his campaign. in no way has he equivocated or left wiggle room. when you ask senior aides, they don't back off of it. the statement here is they have no intention to raise taxes on middle-class americans and yet you see all these headlines based on what the treasury secretary said. we may see a little bit of clarification on that today. >> not quite the economic advisers breaking out in choruses of "happy days are here again" but the feeling things are getting better and the stimulus package is working. >> reporter: there's always the potential you could have another drop. fed chairman bernanke has been saying for months now, so they want to point to progress. they want to take a little bit of credit for it especially since the stimulus is not

popular. republicans have had a steady drum beat saying it's not working. it's a big $780 billion waste that hasn't worked as promised. to the extent the white house can look at the numbers like the gdp last week and says this means what we're doing is having an effect. we got us off the edge of turning a recession into a great depression, they want to do that. on the other hand, unemployment is the economic indicator most americans feel is still terrible, it's getting worse. we expect it to get to double digits. i think elkhart's unemployment rate is up to 15%. and that's not going to get better for at least another year and even then starting to get better. returning to levels we saw a few years ago could be many, many years off. the president knows if there's any issue that's going to be the refren up issue in 2010 that's it. joblessness. >> right. and of course elkhart, indiana, unemployment rates have been up as high as 25%.

an area that makes rvs and other automobiles. bad there. we have with us on set as we do every morning, the anchor and managing editor of "way too early" willie geist. he has a question for you as well. william? >> good morning to you, savannah. first, congratulations on taking over at the white house. frankly, it's something we've been hoping for for quite a long time around here. >> reporter: no, i told joe it's chief white house correspondent. >> lose the quotes. it's for real. let me ask you about health care. friday we send congress off to the month long recess. how is the white house feeling right now about where they are as this break comes? are they optimistic? are they discouraged about what they may get a couple months from now? >> reporter: i think there's a real recognition that the message has been off and august is an opportunity for them to sharpen that message and try to make it more compelling to

ordinary americans that 80% plus who do have insurance. we saw that start to happen last week. we saw speaker pelosi preview her hand. she went out and said these insurance companies were the villains. you harper administration officials talk more about health insurance reform not health care reform trying to say that we can make some changes in the way insurance is handled. no more denying people because of pre-existing conditions, that kind of thing, and that would be very popular. i think they are trying to retool that message and august is an opportunity to do that. well see the president out on the road pitching this. the senate finance committee still working on a bipartisan deal but i don't think there's a real serious expectation that we'll see a bill out of the finance committee this week. >> savannah, i don't think as far as obama is concerned this august vacation comes soon enough. he's completely fumbled this message. i've said it often. he's been out too much without any real meat on the bone. is there any chance, we talked

earlier in the show about he's the guy with his hand on the button as far as foreign policy that he comes back after the break and says, guess what, this is my health plan now and forget you can't do anything revolutionary by committee. he tried to do the anti-clintonian thing where he comes back and says i'm taking the ball. this is what it looks like. singular message, his new speech a defining speech for his presidency. >> reporter: it's an interesting concept. i've tried to press senior aides on this issue. not exactly your idea but this notion that are you holding back but waiting for the right moment to come out and say the president takes a stand on issue "x," "y," and "z" and almost try to run on that message. they won't rule it out but it isn't something they're necessarily embracing right now. obviously they think they have the right strategy or they're sticking with the strategy of letting congress write the bill, whether or not the president will step up his efforts and the bill out of the senate finance

committee really sign onto it and campaign on that particular piece of legislation remains to be seen. there is recognition here they have to do better selling this health care message. it has not been convincing to most americans. >> willie, since she is now nbc news chief white house correspondent she's going to grow a goatee? >> no, i think we've all learned the lesson from chuck todd goatees just don't work on tv. >> reporter: i don't think i could pull it off. i don't think i want to, either. >> god bless you, savannah guthrie. thanks for being with us. nbc news' chief white house correspondent, savannah guthrie. up next, "vanity fair's" special correspondent vicky ward. when i was seventeen

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well, what the president has said -- uh -- uh -- uh -- uh -- that, uh -- the, uh -- and i'm -- uh -- it's been very constructive -- uh -- and we've been -- uh -- political friends in my current pursuits -- uh. >> that's not fair. >> can you imagine -- >> they would cut it. >> that was "letterman the" imagine if they edited what we said one morning, the words that come out of my mouth. the sexual insults that come out of donny. maybe for you. with us now, contributing editor

of "vanity fair" vicky ward. she wrote a huffington post article. don't even put that name in the teleprompter, about an investment group, the group that gave nearly $7 billion to bernie modafter and raked in the returns with his money. tell us the story. this guy whose name i'm not even going to try to pronounce. this guy took the money and ran. tell us the story. it's a yacht and ran. >> took the yacht and ran. central greenwich was one of the biggest feeders into madoff. it lost its investors $7 billion. the day madoff was invested it was busy trying to launch a new madoff fund. he owned 22% of the company.

in june he took position of a big boat called "oxygen" with eight crews, can seat 12 guests, and he's spending the summer floating around on the mediterranean, the adriatic. >> it's been a rough year for him. >> it's been a rough year. >> so now his lawyer claims that he's desperately trying to sell it now. in order to sell a boat are you don't have to be on it. >> what is he asking for? >> where it's listed, his price asking i've heard anywhere between $22 million to $30 million. >> should i make a bid? >> i say absolutely. >> i'll bid $12.5 million. they're as bad as madoff, they hear feeder fund. if i gave this guy $1 million. what he did was he took

$150,000 -- he took $15,000, 1.5%, and did no due diligence. these guys were the ultimate power source. >> it's actually even worse, donny. since i broke my story, he likes to talk. he gave an interview to a column bean publication saying i'm a victim. i didn't know anything about mr. madoff and yet -- >> he should go to jail just on that statement. >> he symbolizes precisely what is wrong with the financial system. >> he got 22%? >> he got 21%. he was the chief shareholder and yet he's not willing to take responsibili responsibility, the man who actually generates the money. >> do you really believe, vicky that madoff's sons knew nothing about this, the daughter knew nothing about this, all these -- the wife knew nothing about

this? all of these victims, the so-called victims, knew nothing? how can one man run a $50 billion ponzi scheme? >> the difference between the speculation about him and the madoff family is that he was actually putting out documents to investors claiming he'd done all sorts of due diligence. >> and he did none. >> that's what obviously -- >> there's no money there. >> he told me this guy was okay. >> right. but as we know, because as the year's gone by, the s.e.c. wasn't up to snuff on all of this and there are conversations and have been conversations in legal documents needing

executive disposal he had with madoff, phone calls that began with we're not having this conversation, are we, so something was clearly wrong. >> and, willie, our friends from fairfield greenwich have a statement. i'll read you a statement with regard to your yacht story here. the yacht that vicky ward wrote about was ordered three years ago. by the time of bernie madoff's arrest the yacht's construction -- >> it takes a while. they don't build these things overnied. >> if you want to play you have to pay, makes sense, doesn't it?

>> no, it does not. >> they're trying to sell this yacht as quickly as they can. >> do you know how you do that? >> how? >> you give it to a company who leases it to somebody famous. >> like donny deutsch. >> and then you put their money into the settlement pool. that is what you do. >> $20,000 a week. >> you live a good life, donny deutsch. can i hang out with you? >> i'm trying to give you information. >> donny is totally right. >> willie and i want to live your life. >> i read, i study before i come on the show. >> he has the finger on the pulse of sag harbor. >> the discussions of nantucket. >> i'd rather keep my regular joe image going here. so the bottom line is there are

a lot of people who are still living pretty well. >> yes. i hope the legal system does it fairly and fast. it's disgusting and it doesn't help -- were you talking earlier about the headlines, bankers and greed. these guys exacerbate the situation. >> we read the article about fairfield greenwich losing $7 billion. are they still -- the doors still open? are people still investing with them? >> would you be? >> no. who is making statements right now? they have people making statements. it's got to be a shell. they're paying a publicist. is it a shell of a company? >> they still have half -- only half of their company was invested with madoff. so half is left. people are look to go buy that half. that i do know. i think, first of all, they need

to make the investors whole. and that's where we are. they're going to be in court a long time. >> a long time. and you know what? they can take that first step to recovery by renting their yacht out to donny deutsch. how much do you say? >> i've never been on one of these boats in my life. >> shut up. what a liar. >> i don't like boats. >> seriously -- half a million a week. >> no joking. >> "vanity fair's" vicky ward, thank you. great to see you. we'll see you again very soon and up next, crazy, he's on crack and he has his own show, "morning meeting's" dylan ratigan and al hunt. first, cash for clunkers. the first monthly sales increase in years thanks to the trade-in program. so should the government stay in the used car business? we'll be getting a live report

from cnbc's phil lebeau. >> look at him. >> from detroit. looking like a blues brother. he's on a mission from god and he's going to tell us about it. ( dog barking )

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i've got a flood of traffic and people doing cardio has been outstanding. we did over 30 vehicles. we had people here until 3:00 in the morning. >> this is what we live for is this type of buzz. >> this program really has made it seem like it used to be. >> the good old days. >> the good old days. >> welcome back to "morning joe." the obama administration's cash for clunkers has been a surprise success with consumers burning through all $1 billion in the first week alone.

now the senate will vote on whether to extend the program by another $2 billion but some are wondering is it worth the money? here now from la grange, illinois, phil lebeau. he has the latest on the new government program. good morning, phil. is this more big government or is this a good plan for america's automobile company? >> reporter: well, if you're in the auto industry and here in the midwest where there are so many auto jobs, you think it's a good plan this program has been much more successful than people were expecting. when you look at all the sales in the last week, about 250,000 vehicles, you're going to see july sales at the highest rate we've seen in at least a year. ford posting the first positive monthly sales for ford in two years. it's clear this is having the impact the auto industry is seeking. the question is whether or not the senate goes along with allocating another $2 billion so that more people can come into the showrooms over the next month or two to trade in their

old gas guzzlers. how successful it's been at this dealership in illinois, there are about a third fewer vehicles on this lot there were cars parked here than saturday so over the last two days a third of the vehicles are gone and most of the ones disappearing just like this, like this ford focus. the four cylinder car is in vogue right now. that was the goal of cash for clunkers. it's been very successful. we'll have to see if more money is allocated to keep it going over the next couple of months. >> phil, it's donny. suzy welch and i are having a debate. suzy's feeling is we're digging a deeper hole, whether we're going to have research on these 250,000 buyers to see how qualified these buyers are. >> reporter: they wouldn't have gotten into the program and the dealers wouldn't have been able to write them loans if they didn't qualify. a lot of these sales, donny, were written up before the money was officially allocated so really the system was locked and

loaded. the pipeline was stuck with people. dealers have been putting the paperwork together for two or three weeks before the money was officially allocated for cash for clunkers so once the government said, there you go, the money is in the system, boom, all of those sales went through. it's a misnomer to say that we went through a billion dollars in one week. that's really about three or four weeks worth of sales. the money will run out today or tomorrow unless the senate approves more, you're not going to see cash for clunkers much longer. >> i'd like this program a lot better if i felt it was stimulate the creation of jobs in these dealerships. any sense the dealerships are hiring to meet the new consumer demand? >> reporter: i don't think the dealerships are hiring. it's too soon to see that. you'll start to see the automakers who already have production schedules set at a snail's pace, the rate will be

above 10 million for july and if it continues at that trajectory they'll start bringing more people back to the plants, adding more shifts. it's not going to happen overnight. that's the go he will to sp your that demand and this is churning the market. there are a lot of people who are going into showrooms. they may not qualify for cash for clunkers because their vehicle is not a guzzler but they're out there looking. they feel more comfortable about the economy. that's bringing people into showrooms. >> republicans are crying, it's the ultimate joke anything that works on the stimulus they're going to say, you know what, governor-backed -- they're rooting for everything to fail. >> donny, i understand that you are just left wing here but you can't generalize because this is the first thing that's worked. >> exactly. >> you just said republicans are against everything that works in the system. >> we have one thing that's worked so far. >> and they're complaining about it. >> some are. let's see what the senate says. >> just don't want to make the

same mistakes twice. >> if you're anybody selling anything in this country, we are the old nation. >> willie, what's up next? >> phil lebeau, thank you so much. >> looking cool in the shades. at 155 miles per hour, andy roddick

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nice shot of new york looking south. a little hazy. >> this is great. get to come see the weather moving through on "morning joe." with us now contributing editor of "rolling stone" magazine the author of "israel is real", a quest to understanding the jewish nation and its history. rich, thanks so much for being with us. what have you learned in trying to crack the code of what's

happened? boil it down into a sentence. >> a sentence i would say that basically there was this real place called israel. 2,000 years ago it was destroyed. it was turned from a temple into an idea where it could never be destroyed because you can't destroy an idea unless you destroy everybody that has that idea. in our own time zionism turned that idea back into a real place that can be destroyed. it's an irony that jewish is sort of less as a nation with an army than it was as an idea. >> that is a good sentence. you talk about the back and forth between the zionists and we'll just call thek peace nicks. that is really at the heart of israel and the idea of israel, right? >> at the core there is an ideal. how do you save israel, by being more accommodating or less

accommodating? studying history it goes back to when the second temple was destroyed. 2,000 years ago there was two groups, the zealots who were a party like the republicans and the name was zealots and the peace party and the zealots won out and their way was to fight the roman empire and they were destroyed. look what you got. 2,000 years without a home. >> you say 2,000 years later we' back in the same place. >> that's what i think. you go through a giant circle and come back to the same place, which is the hard core settlers that don't want to leave and they think in order for israel to be israel they need to have all this territory, this specific religious territory compared to the people that want to make peace and accommodate. >> were you surprised by the leader of hamas coming out this past weekend and saying all right. we can have peace with israel. just take us back to '67, the '67, pre'67 borders and we're fine? >> right. >> that could actually be a step forward, right? >> it is but you don't know

because it all goes to intent. one of the things about the settlements, they became a problem but you wouldn't have the settlements if you hadn't had the war on israel. >> right. >> so in a weird way the settlements aren't the cause of the trouble. the settlements are the result of the trouble. and if you're israeli, if you're living in israel, there is no reason to believe if you pull back you're not just going to get rockets and -- >> they've been given no reason to believe that and the leader of hamas still isn't -- >> one little thing to mention. it was only 65 years ago that we had the holocaust and 6 million jews so if jewish people around the world are maybe a little suspect and offensive/defensive it with good reason. i say that as a jew. >> is the concern for the jewish individual, is it written for people who care about what's going on in the middle east? who did you write the book for? >> i'm kind of the last person you'd expect to write a book like this. i'm not a scholar, or academic

or expert in this field. i've been writing stories about like george clooney and angelina jolie but this story is the biggest story in the world, the one subject that can get a room of people fighting immediately all over the world and taking sides. i really wanted to go back and write for everybody and it's sort of -- you get everything in the news sort of from the present tense back. you can never follow it. and i always think of the way israel is covered is like a picture of a moving train. i wanted to sort of step back and show the whole thing and it would be for everybody and people that want to know what's going on there can follow it like it's a story because to me this story is like a great epic, like lawrence of arabia. >> why do we have a situation, you're talking about israel no longer an idea, but a country that can be destroyed. why is it that in the 65 years since the holocaust, over the past decade or so, israel has begun to face such hostility not only across europe and across the world but also on college

campuses a couple miles from here and across america? it seems the more elite the college campus the more hostile the middle eastern society programs. >> toward israel. >> right now -- >> there are a lot of ways to look at it. the one way to look at it is the holocaust is this thing that happened when half the people that lived through it, they were sort of prevented from happening again. it fought like 50 years of the end of that antisemitism and now that generation is passing and people are forgetting. it's not living history. it's becoming ancient history. >> 25% of germans think the holocaust never existed. >> 25%? >> the israelis have a little chip on their shoulder and maybe there's a reason. >> did you agree with me that israel faces a lot of hostility on elite college campuses? >> yes, but the thing is -- see

barack obama in his speech really attached israel to the holocaust but this idea of going back and rebuilding the ancient jewish kingdom which is all zionism is, is an ancient idea. it's written about in "the decline and fall" always defined, what being jewish is, is going back to jerusalem. so that kind of idea, that hostility was built into it from the beginning and the original leaders of israel were pragmatists and understood that and thought we'll take what we can and make peace wherever we can. the danger for israel is that the zealots become in charge. they are maximalists. >> rich, thank you for being with us. an important book and it is called "israel is real." when we come back, the mystery is over. after 18 years we have found our u.s. pilot that disappeared in iraq in '91. you've got the top stories of the morning, when we come back.

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the mobile hotspot that fits in your pocket. sprint. the now network. welcome back to "morning joe." it's 8:00 here on the east coast. we'll start you out west. 5:00 a.m., what do we call that, the chopper cam, the dash cam? jam cam! looks like travel -- >> i swear it's either you or me can just bust it or -- >> why shouldn't you appreciate this great land? >> i do appreciate it.

>> the mgm grand there in the foreground. a beautiful shot. >> oklahoma city, oklahoma. shaking the camera. looks like traffic moving nicely there. let's go to st. louis now. again, really no trouble on that bridge right there. keep you updated on that traffic situation. and there it is. the white house, washington, d.c. looking good. great to have you with us for "morning joe." it is 8:00. a lot to talk about. most of all we're talking about today is going to be framed by what we said yesterday on the sunday morning shows, timothy geithner not closing the door to higher taxes for middle class americans. you can expect some pushback from the white house on that today. the president will stick with his september pledge of no new taxes for the middle class. 95% of americans. also, feeling that things may be getting a bit better. if you look at the cash for

clunkers program, certainly that worked well. alan greenspan said yesterday it wouldn't have worked six months ago but is working now. on the other side, "the wall street journal" actually has a headline that talks about a recovery in the housing market not for the high end, not for people trying to sell homes on the high end. nobody is buying those. but for lower and more moderately priced homes we're starting to see some movement there so maybe some good news and maybe they're right. we'll be whistling "happy days are here again" by the end of summer. we'll see. first, here's willy geist with news and after that we're going to be going to the incomparable suzy welch for her take on it. and donny -- he is in love with sarah palin. >> you gave sanford a pass. was he really in love? and i just, when i thought she was getting divorced i put my hat in the ring. >> first of all for the record i

didn't give sanford a pass but as with the forward governor of new york, i don't jump up and down on people's graves. >> i agree with you. but my love -- not my love -- my intrigue with sarah palin is genuine. >> no, your love. >> i genuinely if she was single would love to take her on a date. she's an incredibly appealing woman. i don't want her running for office but i think she's beautiful. i think she's interesting and, by the way, pete, if we can have one shot here, just for the record, nbc universal and general electric do not endorse dating services on their news programs. can you do an online chat maybe? >> i'm sensitive. i think it's time men bare their feelings. >> okay. >> i've always thought -- >> when i thought of donnie deutsch i thought possibly his achilles heel. he cares too much. he's too sensitive. >> he puts himself out there.

>> she'd probably reject me if she was single but that's okay. >> just a boy with his heart in his hands. >> okay. we've got the news. >> the top stories, the story we brought you first last hour. officials in miami are assessing passenger injuries this morning after continental airlines flight 128 was forced to make an emergency landing. the jet was enroute from rio when it was diverted for severe turbulence. four people are considered in serious condition. we'll keep you posted. the united states military says it has identified the remains of an american navy pilot shot down in iraq during the persian gulf war. captain michael speicher has been missing for nearly two decades. the u.s. is calling on the swiss government to help with the release of three americans now in iranian custody. sarah short, shane bauer, and

joshua fattal apparently strayed across the border, get this, while hiking in northern iraq on friday. >> as we were saying, this is about, seriously, just like the four wheeling expedition across north korea back in the '80s. >> do you think there is any chance these kids were cia? i just throw it out there. every once in a while, do you think? >> i don't know but the iranian news agency will be taking your quote, your question. >> exactexactly. they are now. >> from my understanding they were warned. >> there was a guarded area. >> they were warned. they continued going and i got to say, i asked the same question yesterday. in my head. i would never ask that out because there are americans whose lives are in danger and you have just endangered them even more. >> it's such a wacky thing to do, to go hiking in iraq. you just have this sort of -- >> worse than hiking in iraq,

hiking in iran. >> it is very odd. >> we've got swiss diplomats working to confirm where those young people are being held on behalf of the american government. >> great. >> also in iran this morning the supreme leader is endorsing mahmoud ahmadinejad as president, even as protests continue over june's election. the ayatolla's blessing clears the way for ahmadinejad to take the oath of office before parliament on wednesday. >> you have to give the supreme leader credit. he has rebounded. like ali coming back. >> you know what? i think you now have gone -- >> could we get like a 12-second delay? please. >> you know what? do not say they all look alike. that is inherently a racist statement. look at that. >> moving on. the white house is offering an optimistic if cautious outlook when it comes to the

economy. although the recession appears to be easing, treasury secretary timothy geithner is not prepared to take any options off the table. >> the president has said the taxes won't go up for any americans earning under $250,000 but it doesn't appear he's going to be able to keep that promise if you're going to bring the deficits down. >> again, we can't make these judgments yet about exactly what it's going to take and how we're going to get there. >> so revenues are on the table as well. >> again we're not at the point where we'll make a judgment about what it's going to take. >> but you can't rule it out. >> i think what the country needs to do is understand we have to do what's necessary. >> and the obama administration says it will suspend the cash for clunkers auto rebate program unless the senate provides billions in additional funding. despite the program's popularity, there is still some debate over whether it's a sign of economic recovery or just more big government intervention. >> it's clear you can look at amtrak or the post office and now cash for clunkers, the

federal government went bankrupt in one week in the used car business and now they want to run our health care system. i just think this is a great example of the stupidity that's coming out of washington right now. >> there is no doubt that that very extraordinary response that we saw is a very important indicator that the state of confidence in the economy is beginning to pick up. if we had been, the clunker program had been put in place six months ago it would probably have been a dud. >> all right. thank god we have, you know, we've gotten past the news and donnie's interruptions and we can finally raise the level of discourse here by going to washington's executive editor of bloomberg news. he's also the host of bloomberg's political capital. this weekend he sat down with house speaker nancy pelosi to discuss health care and her use of the word "villain."

>> you don't expect health insurers to be part of any coalition to support this. >> no. i don't like using words like "villains" but people call me a villain all the time so i figure it's probably okay to use it back. they have been the ones who have held -- the american people have been at their mercy. >> al, were you as surprised as i was that nancy pelosi called insurers immoral and villains? whether you believe they are or not, it's not since newt gingrich have we had a speaker who throws words around like that. >> it certainly is a shift in tactics, joe. remember, just a few months ago the insurers were supposed to be part of this very broad coalition. clearly they're not now. you think what the democrats -- i think what the democrats feel is the democrats have the better of the dem gog argument if you will and they have to get back into it on health care if they want to compete. >> okay. how did, al, you saw '93 and

'94, bill clinton's efforts go off the road, same thing happening here. how did obama, pelosi, and reed lose control of this debate? what happened? how do they plan to get back ontrack? >> joe, i don't think it's as bad as that. they're in worse shape than they hoped to be at this time they being the democrats but they're in much better shape than clinton was at a comparable period in 1994. it's gotten through a bunch of committees. this bill is almost ready to go through the house. not with much of a majority but still go through the house. the senate is dicier but at least they're in the ball game there. there is -- i think the public option is not going to be the major stumbling block. the major stumbling block is going to be how you pay for this thing and by the time it's all finished it's going to make a sausage -- sausage making is going to look pristine. it's an ugly, difficult process as you know. >> nancy pelosi obviously dealing with some low ratings. we were talking about it

earlier. is she starting to feel the strain of that, having lower approval ratings than as we said sarah palin or dick cheney or does she really not care? >> she always can have a picture of newt gingrich up on the wall because no matter how low she goes the ratings are always higher than speaker gingrich. as you remember 14 years ago. so when you have an agenda the way that the house democrats with cap and trade coming up, one month, health care the next month, it's going to be difficult and some of the strain is showing. >> democrats getting inner vowels aboinner -- nervous about the 2010 elections? >> sure they are. >> do they believe the economy is really turning around or are they whistling past grave yards? geithner and some are suggesting not that happy days are here again but that we've hit the bottom. >> the economy is clearly turning around and we have hit the bottom. the question is is it turning around quickly enough? you'll still have unemployment of 8% or 9% probably next fall, the fall of 2010. that'll be down from 10%. and what democrats have to hope

for is voters will say, well, directionally things are getting better. it still will not be a very robust economy. >> we, of course, the news yesterday, stephanopolus and a lot of others were talking about the fact that geithner refused to close the door on raising middle class taxes. you remember 1988 george w. bush read my lips no new taxes. we just played the obama clip from september of last year pledging no taxes on the middle class. do you think the white house cleans this up today and says, hey. the president is sticking by his pledge, we're not going to raise taxes on the middle class? >> well, they can't really. joe, if you look at what the president has said in the last couple weeks, he's parced it very, very carefully in terms of health care. he hasn't said no taxes on people under $250,000. he said it cannot be basically, it cannot be fundamentally, cannot be overwhelmingly funded by people making less than $250,000. that's quite different.

i don't see any way they can put together a revenue measure on health care that doesn't affect some people making under $250,000. that's short term. long term when you're talk bg the deficit, whether 2011 or 2013 it's just absolutely impossible without addressing middle class taxes. >> so you actually think geithner may have been actually a little bit of maybe even sending out a warning signal that middle class is going to -- can expect higher taxes? >> yeah, at some stage and in some form. i think we may be a way off before your $90,000 a year cop gets affected by this, if ever, but in health care if you talk about taxing the health insurance plans, joe, that doesn't just affect people who make -- goldman traders who make a couple million bucks. that affects a lot of people who are middle class taxpayers. maybe a very good idea.

a lot of health professionals say it's the only way to hold down health costs but it does amount to a tax on some people who are classified middle class. >> of course president obama, the ad he ran more than any other last year, was that john mccain was going to tax health care benefits. can he turn around and do a 180 flip? >> can he say as earl long did one time when asked about not keeping a campaign pledge, he said, i lied. i don't think barack obama is going to quite take that tack, joe, but they're going to have to find some formulation to get off of that. >> al, i think it is beyond political suicide for both him and all democrats if the way he pushes health care through is taxing the middle class, that's an 0 for 2, a disaster. i don't see that happening. i'd say that is an absolute last resort. he'll water the health care down so much. i don't see how he can possibly do it. they'll ask him today and he can't waffle. the first press corps today will

say, sir, you said in your campaign that you would not -- what's his answer going to be? >> al, what is his answer going to be there? >> joe, this is not what i meant to convey. i don't think he's going to finance a health care bill primarily through taxing the middle class. i think one of the measures that has to be involved in raising revenues is certainly going to have some effect on some middle class people. if, for instance, you tax the cadillac portion of health insurance plans, that doesn't just affect people who drive cadillacs. but it will not principally be funded through taxes on the middle class. you'll get a date with sarah palin before that happens. >> well, i was just going to say, you just can't close the door on that if you're the obama administration and i was going to ask you, finally, do you ever think sarah palin would be dating donnie deutsch? i don't see that in a million years.

>> why? >> joe, i'll pay for the price of admission if it happens. >> oh, my gosh. >> honestly, i disagree. i think if she was available she would. >> date you? >> why not? >> it's amazing, just amazing. >> you are exact op sits. >> we'd work. that's what she needs. that's it. >> i think she's happily married. >> if she was single of course. >> all right. now, great to see you, al. and we always appreciate you coming onset. >> thank you, joe. >> next time we're in washington we'll see you there. coming up next, economic data out this morning including monthly auto sales. later, author ted jones has a timely new book out about the war in afghanistan. right after the break. we'll be talking to, you know, i was going to say the craziest

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we're certainly in a very different place than we were. six months ago the economy was in a nosedive. people were talking about the possibility of another depression. statistics all suggested a vertical decline. none of that is the situation right now. we're certainly starting to see a turn around. we have walked back from what we were facing six months ago and

that is because of the policies that were put in place. >> with us now to talk about that is dylan ratigan. dylan, larry summers says we've walked back from the edge. things are starting to turn around because of the stimulus package. do you agree? >> i do. i think a lot of the things we did in the fall at that point of crisis have reestablished a functioning market, have reestablished a functioning economy albeit at a lower level. there is no question about that. >> happy days are here again? >> i wish. the problem is how did they get that to happen? the question is not did they get the economy to function again. it's functioning. the question is not did they get the markets to function again? the markets are functioning again. the question is at whose expense was that decision and what was the structure of the system that was created that we had to do what we had to do last fall? what did we have to do last fall? we had to take the future

generational wealth of this nation, his children, every child in this country, to the tune of trillions of dollars at the federal reserve and to the tune of trillions of dollars at the treasury department to extract the rift created on wall street, stick it with the taxpayer, leave the compensation with them, and allow the system to resume itself. while everybody else in america that can't make their car payment or home payment, the system is set up to throw them out, if donny and i start a big bank and i look at donny and i got a secret weapon, donny, what's that? we're too big to fail. that means we can risk as much as we want and pay ourselves as much as we want and when the you know what hits the you know what it's their problem. that is a legalized structure in the banking system created in the late '90s which is basically how we got into this. i wonder why mr. summers doesn't deal with too big to fail. >> dylan, you think -- >> i think the cost of doing this is unknown and immense and i think donny would agree. >> yes.

>> in other words we did what we had to do to avoid driving the car into a tree. >> had no choice. >> the question is not why did we give them the money. the question is why did we not exact terms from them when we gave them the money. why did we not exact terms? that is when the theft was perpetrated against the american people. why no terms? why no terms? >> okay. followup question. do you ever sleep? >> in the evening. >> what do you think of this stuff? you come out here like it's like 3:00 in the afternoon. you're like pumped up. >> i know. i think about it a lot. it blows my mind. the other thing, i was so invested and so excited and thrilled for the capitalist system to see that the people that were heroes to me -- >> do you wake up in the morning -- >> were not making money but were stealing money. >> wait. who is a hero to you? >> all these people that were, that set themselves up as the architect of the modern financial system, this genius

financial system. >> right. >> and then to find out after the fact that the genius financial system, this hyperefficient system which it was incredibly efficient, was a means for them to risk the wealth of a nation. >> this surprised you? >> i couldn't believe it. >> guys that work at goldman sachs? >> i couldn't believe how explicit it was. in other words if there was a meeting at the treasury department where they said we will give you the national capital of the united states of america, you can keep your compensation from the use from the risking of that capital. >> who is running the treasury department? >> former ceo of goldman sachs. >> shocker. >> i guess what frustrate me is not the bankers or the borrowers but the fact that our congress refuses to enforce the rules of capitalism. >> dylan, we all agree on this insanity of what happened. okay? >> yeah. >> what are the new rules? because at the end of the day, my theory is, no matter where we

draw the line, whatever it is, your show is all about solving problems. >> yes. >> next 60 seconds you've got the pulpit. >> yes. >> give me the solution to keep these scum in lines. >> too big to fail. in other words, if i don't solve too big to fail i don't solve the problem. it's only too big to fail that is the problem for us. if you and i want to start a bank where we're weasels and try and steal money but we aren't that good at it or can't get that big in doing it, our liability is not that much. but if i am able to pay off the government to allow me to assemble a massive financial institution or i can now again assemble the trillions of dollars in risk that i cannot afford to bear, pay myself for the trillions of dollars in risk, and then stick the risk with the american people? to not deal with too big to fail is to perpetuate the problem. it's to perpetuate generational theft. >> you said the scum? >> okay. >> what i'm talking about is

anybody who basically was taking risk with money with no down side on their own and are getting paid big bonuses, billions of dollars. i don't mind people that make money. take your big piece. not all and not even the majority but there are many bankers out there who are getting bonuses as we speak, $31 billion in bonuses. >> right. >> when they lost $80 billion. a decent man doesn't take a penny of taxpayer money. >> hold on. let susie in here. >> the people who villify this, they were rating agencies, the whole system was off track at the same time. >> that's to perpetuate the theft. because everybody had to play, because i needed stupid borrowers, i need bad journalism, greedy bankers. ratings agencies. i need low cost of capital. a lot of things need to come together but there is only a small group of people who have the power to set the rules by

which the game is played. and those people going back to the late '90s with the creation of bliley expanded risks with your deposits, the commodities act of 1999. it's very clear where the decisions were made when you look at it. >> i think you can put it on the heads of some individuals. >> no, no. it doesn't make it easy. here's the deal. capitalism is either investors investing money into the economy, into businesses large and small, that's why wall street exists as a vehicle to push money into the economy. >> what you want to do is punish the investors. >> no i don't. you're putting words in my mouth, my friend. i don't want to do that at all. i want to protect the investor. i want to punish the ponzi scheme artists and parlor game players who are playing a parlor game calling themselves investors but, donny, it is a parlor game at america's expense and if you want to call yourself an investor but all you're doing is playing a parlor game at america's expense i believe

americans are intelligent enough to know the difference between donny deutsch who makes an investment in a business and donny deutsch who uses his influence and power to play a speculative parlor game to pay himself at america's expense. donny in category one, investor, not category two, vampire. >> how many did you do -- imagine you're inside of a system. >> there you go. >> you just have to work through it page by page. you know, i've read more of it since you've been on here this morning than i did on vacation?

>> if you don't believe in capitalism -- >> you can't stop. >> he's right. >> he's on a mission from god. >> he is. i'm just in favor of capitalism. i know it's crazy. >> one more thing before you go. >> something of value for your money as opposed to a way to just suck money out of the system. >> dylan ratigan, executive compensation cams. >> it's like regulating how much blood a vampire can suck as opposed to --. >> okay. >> and then good investors can become billionaires and the vampires go away. >> dylan, i love you. thank you for being with us. >> sure thing. >> you're great. your show is up next. tools are uncomplicated?

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time to get a check of business before the bell with cnbc's international superstar erin burnett live at the new york stock exchange. erin? >> good morning. good to see you, joe.

>> good to see you, too. >> all right. >> we just survived dylan ratigan. >> hurricane dylan. he is, category 5. >> he was category 5. he was a cat 5 this morning i tell you, erin. so this weekend we heard larry summers and others at the white house talk about how things are starting to turn around economically. >> yes. >> what's the feeling on the street? >> well, the street continues to be happy down here. you'll have a much higher open. we're well above 9,000, 9171. now, the great fight is whether it's going to continue and whether something like what alan greenspan said over the weekend which is we might have another lag down in housing is going to derail the stock market recovery. we talk about what is the quote-unquote new normal? so far of course you're going to get an increase now but once we get back to a stable state it may be a depressing place. >> erin, explain the new normal.

we pushed the reset button. savings rates have gone up to 7%. even when we recover what does the new normal look like? >> well, nobody knows what it means but i think wilba ross captured it well in an interview this morning on npr when he said household wealth has dropped by about $6 trillion but household debt paydown, we've only paid down about $200 billion of our debt. so that gives a sense of just how great the loss in net worth is particularly in housing. and how we really haven't started to pay down a lot of our debt which means it could be a very long time for consumers in this country paying down debt and we'll need to be putting money toward paying down debt instead of consuming things. >> i have to ask you this question. donny and i when we talk to people around manhattan and the country that have a lot of wealth, the people that have been sitting on the sidelines waiting for the market to bottom out like it did with the s & l crisis, they poured money in. they are saying just the

opposite of what we're hearing on tv. over the past two to three months, these people, big money people, are more scared today than they were six months ago. donny is hearing the same thing. >> yes. are you hearing the same thing? >> yes. >> off the camera, that people that have the real money. >> yes. >> they're just scared as hell. >> yes. now, the question is that a con trarian indicator that they've lost the most and are so terrified they can't believe the surge we've seen is for real. i don't know. but three quick things, joe. on that front before we go, keep this in mind today. emerging market stocks are now back to where they were before lehman. remember how everyone said we're up a little bit since the bottom, up 40% but we have so far to go to go back to where we started? emerging market stocks have gotten there. auto sales are out today. that is an important thing to watch. we'll have the first year over year increase. not an improvement in the rate of decline, year over year increase for ford in auto sales this month since november of 2007. >> that's great. >> that's something to keep in

mind. by the way, i don't know what you think about it but look at this op-ed in "the wall street journal." we are not number one in the area that our president has defined as where we'll be number one and that's alternative energy. we are not number one at all. china is. >> that's fascinating. all right. international superstar erin burnett always great to see you. >> good to see you, joe. good to be back. >> say hi to king. july was the deadliest month for u.s. troops in afghanistan. will a shift in strategy help change the course of direction there? we'll be talking to author seth jones when we return about that. . ♪ singer: buckle up, everybody 'cause we're taking a ride ♪ ♪ that can strain your relationships and hurt your pride ♪ ♪ it's the credit roller coaster ♪ ♪ and as you can see it kinda bites! ♪ ♪ so sing the lyrics with me: ♪ when your debt goes up your score goes down ♪ ♪ when you pay a little off it goes the other way 'round ♪ ♪ it's just the same for everybody, every boy and girl ♪ ♪ the credit roller coaster makes you wanna hurl ♪ ♪ so throw your hands in the air, and wave 'em around ♪ ♪ like a wanna-be frat boy trying to get down ♪

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seth jones, the author of the new book "in the grave yard of empires, america's war in afghanistan."

seth, explain the title, grave yard of empires. >> it's a reference to what some people have called afghanistan with the british experience there, alexander the great's experience, the soviet experience there. it's an area that has been very difficult for invading armies. >> seth, when i read "looming towers" you read in that book actually osama bin laden believed that he could lure the united states into afghanistan and it would be a grave yard for this empire as well. it didn't look that way for a couple years but my god things have gotten very complex there lately. >> the levels of violence have increased every year. 2009 will see the largest levels of violence since the u.s. invaded in 2001. but i will say on this front we've seen some restructuring of the taliban insurgenciy, too. so not all is well on their front as well. they've replaced a whole range of shadow governors out of some concern about the u.s. move into the south. seth, we always hear about the taliban and how the taliban is our biggest problem there.

most americans don't realize that the taliban is a minority and is extraordinarily unpopular in afghanistan. >> as one tribal leader said to me a couple weeks ago in southern afghanistan the reason we don't like the taliban is because they try to tell us how to live our lives. i am a poshtun. if i want to grow my beard long i'll grow it long. if i want it short i'll grow it short. nobody tells me what to do. the taliban top down ideology has angered a lot of people in southern and eastern afghanistan. >> this isn't like vietnam where there is a battle for the hearts and minds and we're losing that battle to the taliban. we're unpopular, no doubt our popularity is going down by the year, but our battle is not primarily with the taliban in the long run, is it? >> well, actually what you have is almost a zero sum game. both the afghan government and the taliban and other insurgent groups are actually quite

unpopular, so we have this strange situation where we're supporting a government with elections coming up whose opinion ratings have significantly decreased over the last couple of months. we've got two unpopular sides. >> seth, the president has made such a commitment to afghanistan. is there a good reason for us to be in afghanistan, stay there, can we possibly win? where do you come out? >> well, i think when you look at actually al qaeda's relationship with the taliban, the network and several other militant groups operating from the afghan/pakistan border areas it's still extremely close so the more the taliban takes and influences territory, and these insurgent groups move into afghanistan and pakistan, the more dangerous it is for the u.s. we've seen actual terrorist attacks in london in 2005 linked directly back to al qaeda and we've seen a range of other plots since then so i do think from a u.s. national security standpoint this area is

extraordinarily difficult, challenging, and poses a huge threat to the u.s. >> seth, willie gift heeist her. what is the objective at this moment of the united states military in afghanistan as you understand it? how will we know when it's time to leave? how will we know when we've won there? >> well, the objective really is to try to protect the afghan population and that is pushing in the range of rural areas, building up afghan national police and army forces. how do we know that we've won there? i think actually when either the afghan government or local actors, the tribes, subtribes and clans in eastern and southern afghanistan can largely push out that taliban, major taliban presence. so i think that's one of the keys that we're looking for is the pushing out of areas of the taliban infiltration. >> all right. seth jones, thanks so much. the book "in the grave yard of empires, america's war in

afghanistan" and, suzy, as you were saying before, the timing for this book couldn't be any better. we'll be right back with a quick look at the political day ahead. at 155 miles per hour, andy roddick has the fastest serve in the history of professnal tennis. so i've come to this court to challenge his speed. ...on the internet. i'll be using the 3g at&t laptopconnect card. he won't. so i can book travel plans faster, check my account balances faster. all on the go. i'm bill kurtis and i'm faster than andy roddick. (announcer) "switch to the nations fastest 3g network" "and get the at&t laptopconnect card for free".

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house. a nice day in washington, d.c. as for the political day ahead it's going to be framed by yesterday's talk shows. as we told you throughout the morning timothy geithner told george stephanopolus that the white house is going to keep all options open for raising taxes for the middle class. nbc news white house correspondent savannah guthrie, though, told "morning joe" to expect a pushback from the white house today on that idea. also today, you can read the president's lips. middle class, no new taxes. >> i can make a firm pledge. under my plan no family making less than $250,000 a year will see any form of tax increase, not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes. >> and driving the news when it comes to the economy, the top economic news also revolves around the sunday shows. treasury secretary timothy geithner and larry summers were talking about a rebounding

economy. few americans are breaking out into a chorus of "happy days are here again." still, "the wall street journal" reports today of a budding housing market among lower and moderately priced homes. add to that what we heard from cnbc in detroit today that the run away success of the cash for clunkers program suggests we may just be beginning to see things turn around. entertainment news, hollywood will be answering the question of whether the kings of comedy kept their crown. they made "funny people." the take wasn't huge but it was enough to beat "harry potter." no small feat. while the film won't be the kind of money maker others were it is proof the guys that made movies about dumb guys learning lessons have grown up a little bit. for my money i'll take

"anchorman." coming up next, what, if anything, did we learn today? welcome to the now network. right now

five co-workers are working from the road using a mifi, a mobile hotspot that provides up to five shared wifi connections. two are downloading the final final revised final presentation. - one just got an e-mail. - what?! - huh? - it's being revised again. the co-pilot is on mapquest. - ( rock music playing ) - and tom is streaming meeting psych-up music from meltedmetal.com. that's happening now with the new mifi from sprint, the mobile hotspot that fits in your pocket. sprint. the now network. deaf, hard of hearing and people with speech disabilities access www.sprtrelay.com.

earlier in the week michael vick was reinstated by the nfl. he'll be back playing football and is trying to improve his image, working very hard. i think he has a pr agency helping him out. last week sent a giant wreath to the funeral of the taco bell chihuahua. >> wow. that is a smart play. hey, kids. welcome back. this is the time of the show where we talk about what we learned today. willie, we are still getting hate mail from your touching tributes to what was the little doggie's name? >> gidget, the taco bell chihuahua. i just felt it was the right thing to do at that national moment. >> it was touching. >> i learned that donny deutsch wants to go on a date with governor sarah palin and i do have the statement here from the governor's office. donny, not if you were the last damn man on the face of the earth. >> that's the way a woman shows she's interested.

>> wow. >> she's playing hard to get. what i learned today that is there is reverse sexism. in 2009 if a man shows his true feelings he's mocked. i think we have a long way to go. by the way, that shows me she's interested. >> so you are interested in this sexism summit, right, except you think it's sexism against men. >> i was mocked today because i -- >> you're right. >> i want to know what kind of drinks are going to be served at the sexism summit. >> cosmos? >> rob roys. >> what did you learn? >> i'm going to change the tenor. i actually learned something important. i learned there is a fine line between saying the recession looks like it's over and saying we might have to raise taxesment fine, fine line the president is dancing upon. >> exactly. and i learned so much. i learned that this guy dylan ratigan over here, can we get a shot of this guy? he is a caged animal. >> you kidding me? running free out here. >> you are so serious.

usually you smile when we tease you. >> i know. sometimes it's nice to mix it up. creates a little tension. fun. >> yeah. >> all right. stick around. joe and mika on the radio coming up and of course tomorrow morning 5:30 a.m. it's way, way, way too early, it's "way too early." >> it is. this was "morning joe." time now for the morning meeting with a very excited dylan ratigan. take it away. >> thank you so much, william. nice to see you all. good morning you to. welcome to "the morning meeting." breaking news tops our agenda. more than two dozen folks were injured by turbulence, some seriously on a continental airlines flight. we'll head to miami and see what happened. cracking down on iran, the president talking tough saying their refuse to talk nukes may

keep them from getting gas from anybody. is cutting oil off to iran, the irony not with standing as they are an oil rich nation, the best way forward? we'll have a conversation on that subject. president mahmoud ahmadinejad one step closer to being installed as leader once again in that country. white house officials hit the airwaves to make the case that the economy is improving. but don't tell that to the millions of americans who still don't have jobs. we'll get our latest jobs reading on this economy friday of this week. we'll talk rebound and whether it's real and what cost and why they refuse to do anything about the structure that got us into this situation. michael jackson and his family drama now heads into the courtroom. at stake who gets custody of the king of pop's kids and who will control what's left of his multimillion dollar estate. if that's not enough for you, facebook and my space both under fire. the leader of the catholic church in england saying social networking sites are leading teens to commit suicide.

the digital life as the only lifestyle, no lifestyle at all. it's 9:00 a.m. pull up a chair. join the morning meeting. welcome. nice to see you. monday morning. a great day at the meeting today. jim webb going to join us to talk about the veterans and the new gi bill. also going to be talking about lying lobbyists and dirty tricks. health care of course will get a setup on that and lobbying and finance, one of the best journalists on health care will join us in a bit. we begin with contessa brewer with the breaking news on the turbulence and those injuries on the continental plane. >> we're getting this breaking news out of miami this morning. a plane heading from brazil to houston forced to make an emergency landing in miami. the turbulence so bad on the continental jet that 26 people reportedly were hurt. let's go to kerry sanders on the

phone from miami. what's the story? >> reporter: well, four passengers have been taken to the hospital with serious injuries. in all, 14 people were transported to hospitals. this is continental flight 128 flying out of rio de janeiro, the destination was houston. at about 36,000 feet without warning the plane hit some clear air turbulence. it was just north of the dominican republic. the folks i'm talking to now are folks who were uninjured getting off the plane here in miami and they're going to make new plans for their flights. they say that most of the injuries were in the rear of the plane and that those are the folks who are most injured. obviously didn't have their seat belts on. let me talk to one of the passengers here very briefly. you were onboard. did you get any warning and what did you hear and see? >> i just saw the people flying up into the air. there was no warning. the plane just started shaking and there was a lot of