chanukah, the chanukah gelt that we give out, but, no, i just -- i think the whole thing just shows how pathetic the gingrich campaign is on this -- on this topic. >> or in general. >> or in general. >> thank you, ari. that will do it for us. i'm dylan ratigan, and "hardball" is up right now. note to republicans. stop digging. let's play some "hardball." good evening. i'm michael smerconish filling in for chris matthews who is taking some time off after his tour for his book, "jack kennedy: elusive hero." chris will be back tomorrow night. leading off tonight, tangled up in blue. when the very conservative "wall street journal" editorial page tells republicans it's time to raise the white flack, it's time to raise the white flag. house republicans are not only losing on the substance of the payroll tax debate, they are

losing the politics, too. they are getting clobbered by democrats, the press, even fellow republicans. this could be the democrats' big moment if they don't blow it. plus, ad nauseum. there's something comically ironic about newt gingrich who practically invented the modern politics of personal destruction complaining about all the ads a pro-romney pac is airing in iowa. gingrich is being badly outspent and it shows. in his poll numbers and in his frustration. we'll look at the ads that are taking down newt. also, former new mexico governor gary johnson is dropping out of the presidential race to run as a libertarian. now you might have forgotten that johnson was running, but this year a third party, run by a more serious candidate, could make a huge difference in the election results, and tonight we have new poll numbers to show who might benefit. and barney frank's advice to the colleagues he's leaving behind. that's in the sideshow. finally, let me finish tonight with how the republican party's obsession with opposing president obama at any cost may

be costing them way too much. we start with senator charles schumer, a democrat from the great state of new york. senator schumer, thanks for being here. what's the exit strategy? how might this flap over the payroll tax end? house blinks, senate blinks, or does it expire? >> well, i don't think it will expire. i think that basically there is so much pressure on speaker boehner. he's basically standing alone, that the house is going to have to do what the american people want and what many of us have been asking which is very simple police to pass the two-month extension and then we'll negotiate for the rest of the year. speaker boehner had a very bad day. it started out with the "wall street journal" editorial which you mentioned. in the course of the day senator mccain tweeted the "wall street journal" editorial to thousands of republicans and said he agreed with it. later in the day, both newt gingrich and karl rove, two leading republican strategists,

said that boehner ought to just go along here, so he's sort of out on a limb, and i think he knows the right thing to do, but he's got a caucus that contains 80 to 100 very, very hard right people, and -- and he's been following them through the course of the year. they haven't been following him. but at the end of the day i don't think he'll have much choice, and my guess would be that within the next few days, a number of the mainstream republicans in the house will go to speaker boehner and say you cannot persist in this, and he'll be forced to pass the bipartisan bill that was passed by senator reid and senator mcconnell, 89-10 in the senate, that extends the payroll tax, unemployment insurance and the so-called doc fix for two months >> i know that earlier today, senator, you said, look, if it's a one-year deal you want, we'll be the first ones to get back on the plane. did you realistically mean that the senate could reconvene and something could get done before? >> well, what i said was this. it's very hard to believe that

these folks are for a one-year deal if they won't ratify a two-month deal. these are the very same people who were against any deal at all a week and a half ago. in fact, all eight of the people who speaker boehner appointed to be his so-called negotiators were against any payroll tax extension for the middle class two weeks ago, so what we said is ratify the two-month deal first and then the senate leadership, i'm amongst them, will get on a plane and negotiate a -- an extension for the year, but we're not going to fall for this idea that is endemic in washington. when you want to kill something and you don't want your fingerprints on it, you say send it to a committee. speaker boehner has time and time again moved the goal posts back. said get rid of the millionaire's tax and maybe he'll pass it. he didn't. he said lower the percentage

from 3.to 2 and he wanted the pipeline, swallowed out and put it in there and you can't negotiate with that. negotiating with speaker boehner is like nailing jell-o to the wall. we need him to pass this two-month deal which would give us some degree of assurance that both he and his caucus are really for giving the middle class a tax cut. we think secretly they are not. >> a critic's mind say the senate should not have adjourned with this matter still open. as a matter of fact, newt gingrich among others, is one who said he thought it was against the best interest of both the house and the senate for the senate to have left, i think he said something along the lines, of abdicating its responsibility. >> the senate has met its responsibility. what more could we do to pass a bill 89-10, a bill that speaker boehner said was a good bill after it passed and to send it over to the house. i think you've got to look at who is abdicating their

responsibility. when speaker boehner refused to put the senate bill on the floor, the day it passed he said he would put it on the floor. he now refuses to put it on the floor because he knows he has the votes to pass. that's where the abdication of responsibility is, and i don't think it's even a close question. >> here's the comment to which i referred. it's newt gingrich blasting you and your fellow senate colleagues for playing games. let's watch. >> i think this is an example of why people are sick of washington and sick of politics, you know. they can't figure out how to pass a one-year extension so the senate leaves town. i mean, it is -- it is an be a sird dereliction of duty. it's game-playing. obama is so inept as president and congress is so dysfunctional as institution that we're lurching from failure to failure to failure in a way that i think the american people find very disheartening >> i think you've already responded. you don't think the senate abdicated its responsibility by going home for the year. >> who has passed a bill that will extend the middle class tax

cut, senate? the house has not. >> right, but respectfully, if the thing is not resolved, then perhaps the senate should have stayed in business for the year until there was resolution. >> well, hey, michael, look at what happened. we started out with 3.1% for employers and employees. we then got rid of the employer part. we then further negotiated and moved it down to 2. we tried to do a one-year deal, but they put in things that they knew were killers that democrats would never go for so speaker mcconnell -- sorry, leader mcconnell and leader reid came together with a plan. it didn't squeak by t.passed 89-10. a bipartisan bill that has the support of newt gingrich and many, many others. newt gingrich, mitt romney have all said we should pass a payroll tax cut, and it had -- and today the "wall street journal," karl rove and eight -- by now eight republican senators have said pass it.

i mean, it's absolutely turning truth on its head to say, as newt gingrich did, that the senate is abdicating its responsibility when speaker boehner won't even put that bill on the floor of the house for a vote. >> senator schumer, thank you for being on "hardball." we appreciate it. >> thank you. nice to talk to you, michael. >> you, too. let's bring in msnbc political analyst howard fineman, "the huffington post" media group editorial group director. the politics of impasse certainly seem to benefit the white house in this case. howard, am i giving them too much credit if i say it was all by design? did they reel in the gop in a trap? >> well, i was amused by speaker gingrich's statement that obama is inept. the president has inepted his way into having the republicans go over the edge of a cliff here. to answer your question i don't think that david plouffe, who is the political strategist at the white house who first floated this idea of a two-month

extension, i heard about it on tuesday, wrote about it on tuesday. i think i was the first to do so. that was -- they were putting it out there right then. i can't say that they thought when they did that that it would be a perfect way to back the republicans that a corner, but that's the way it's turned out. i think plouffe and company at the white house just wanted to pass an extension of the payroll tax cut because they are concerned about the economy. they didn't want it at christmas time. they didn't want to kill what looks like a creeping but real recovery. i don't think it was a machiavellian plot, but it certainly worked out to their advantage. >> here's the proof. talk about the signs that the president's fortunes are turning around thanks to the spectacle coming from congress. lack at these numbers from the most recent cnn opinion research corporation poll. in a matchup against mitt romney, the president now leads by seven percentage points among registered voters and against newt gingrich obama leads by a remarkable 16 percentage points. it's interesting to point out other polls show the

hypothetical races to be much closer but there lies the divide we're addressing. >> and i think there are other poll numbers that bear on this, too. one is that congress is just so reviled, i mean, they have an 11% approval rating. it's probably, you know, too high by that estimation, and if you look at poll numbers on who is better handling the tax situation and whom do you trust on taxes, the president's numbers have gone up. i think this fall he's won the debate framing the millionaire's tax against the payroll tax, and -- and now this two-month -- this argument over the two-month extension kind of crystallizes in -- in the view of most people who is being reasonable and who isn't. those 100 tea party people in the house keep looking for ways to get things done that they want to do, and they keep looking for must-pass bills to do it on, and -- and tie themselves in knots doing it. they really want to have tough means testing of medicare.

they really want to change environmental rules. they really want the keystone pipeline. it's not that they are putting poison pills in there to prevent the president from doing anything. they want things that just are going to blow up deals because they want them. and -- and boehner, the speaker, does not have the power to go against those 100 in his own caucus, and what the president is doing here is kind of dividing the leadership on the republican side in the house from its -- from its rank and file, and that's going to pay dividends for the president down the road as well. >> there were differences in the way in which mitt romney and newt gingrich are responding to this situation. speaking of mitt romney, the candidate was asked about the payroll tax fight in congress this morning on "the daily run don" and specifically chuck todd asked him about comments by senator scott brown that the house republicans and what they were doing was an irresponsible aprove. let's watch. >> i'm not going to throw gasoline on what is already a fire. what we really need is a president that's the leader, that can stand in with the

members of both parties and work together on finding a common solution, but this president has been intent on attacking and attack mode is not the way that a leader tries to get people to work together. >> governor romney anxious to cast aspersions on the president but not necessarily choose sides with regard to the gop, house and what they are doing on this. >> yeah. well, that -- that shows you both a stylistic and substantive difference between mitt romney and newt gingrich and shows you why the, at least until the barrage of negative ads against him in iowa, that newt gingrich was rocketing to the top because newt gingrich said the obvious and sensible thing which is in this thing pass the two-month extension whereas mitt romney is so unsure of his own political ground, is so afraid of his own shadow politically that he was afraid to state the obvious thing, that it took the "wall street journal," of all people, to state. >> right. caused kuwait a ripple this morning. >> yes. >> thank you, howard fine morning as always. >> take care. >> iowa is being bombarded with

ads, and many of them have been against nutriknew. as a result, he's sinking in the polls. we're going to look at ads that are crushing his campaign next. you're watching "hardball," only on msnbc. [ male announcer ] what can you do with plain white rice? when you pour chunky beef with

country vegetables soup over it... you can do dinner. four minutes, around four bucks. campbell's chunky. it's amazing what soup can do. we've got some new poll numbers from key senate races around the country, and for that we go to the "hardball" scoreboard. let's start in virginia where a new quinnipiac poll shows republican george allen with a slight lead over democrat tim kaine, 44-42 but a ppp poll out in virginia just last week had kaine with a five-point lead over allen so it's tight and in new mexico, the race to replace the retiring senator, it's democrat mark heinrich with a seven-point lead over heather wilson in a new poll. that's a seat that the democrats hope to hang on to. we'll be right back to "hardball." sovereign of the security line. you never take an upgrade for granted.

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with less than two weeks until the iowa caucouses a barrage of ads is on the air in the hawkeye state and much of the money hasn't come from the presidential campaigns but from so-called super pacs. they can run countless negative ads and the candidate can argue that technically he has nothing to do with the mud-slinging. nobody is fooled except the voters. take a lack at amount of ad money that's poured into iowa so far by campaigns and pacs. they'rely $6 million spent by rick perry and the perry pc. mitt romney and his pac have spent $nearly 4 million and ron paul almost $2 million and newt gingrich almost $500,000, and he has the falling poll numbers to prove it. joining me now to take a look at some of the latest ads as well as what is working and what isn't, nbc political analyst michael steele, former chair of the republican national committee and david corn, the d.c. bureau chief for "mother jones" magazine. gentlemen, i want to show you some commercials, an ad released

today by the pro-romney super pac restore america's future, and it throws everything but kitchen sink at newt gingrich. >> you know what makes barack obama happy, newt gingrich's baggage. newt has more baggage than the airlines. freddie mac helped cause the economic collapse, but gingrich cashed n.freddie mac paid newt $30,000 an hour. $1.6 million. gingrich not only teamed up with nancy pelosi on global warming, but together they co-sponsored a bill that gave $60 million a year to a u.n. program supporting china's brutal one-child policy. as speaker, gingrich even supported taxpayer funding of some abortions, and newt is the only speaker in history to be reprimanded. >> michael steele, i can look at the focus group, they were like this, freddie mac, check, china, check. pelosi, check. pelosi, check. they got it all but it's effective, man, a very effective spot. >> oh, my gosh is it effective, absolutely. you throw $2.6 million at

anything you're going to have an impact, and that's what's happened here. i think the romney team has gone to their -- to their well, and they -- they are digging up stuff and putting it out on the airwaves, and newt has taken, how shall we say, a kinder, gentler approach with his christmas message to be played over the next two weeks. to contrast himself with -- with the style of perry -- of mitt romney but also to -- to remind the voters that -- remember, for all these debate, i was the one when was saying remember the 11th commandment, remember that this should not be about republicans tearing up each other but by focusing our energies on defeating the president, so we'll see how it plays out, but you're right, right now, michael, it's been killer, and newt has decided to perry that thrust with this particular type of commercial, calling on all the campaigns to stray away from the negative advertising, and interestingly enough to have more one-on-one

town hall style meetings on the ground so he can address directly those charges. >> but that bus can't drive fast enough. >> but it's driving, right? >> david corn. >> i'm not sure it's even a bus, michael. >> if you think ads like this isn't getting to gingrich, take a look at newt as he lashed out at his chief rival mitt romney for that ad out on the campaign trail. >> all he's got to do is simple. all he has to do when he gets in, he can say i condemn any further negative ads and stop them from running the negative ads and everything short of that is baloney. it's his people running his ads doing his dirty work while he pretends to be above it. >> and romney hit back this morning on "the daily rundown. "here that is. >> look, if you can't handle the heat in this little kitchen, the heat that's going to come from

obama's hell kitchen is going to be a heck of a lot hotter. we have to show we as a republican party and as a candidate that we can stand up to the barrage that's going to come from the obama world. >> david corn, what of it? >> well, you know, it's -- you know, you noticed when newt was talking he didn't say that this stuff wasn't true. i mean, usually if they are telling lies about you, you're going to focus on that as well. his life, i've said this the other day, his life is not just an open book, it's an open sewer, and you know, for the negative ad meisters in mitt romney's camp, it's christmas time, literally. it's like a candy store. newt gingrich is an orchard of low-hanging fruit on all this stuff, and there's just no way this wasn't going to be part of the campaign. he knew that going in. i mean, they haven't gotten to the personal stuff. there's 30 years worth of bombastic bomb-throwing pieces of rhetoric that he said that could fill up not just a two-minute spot but a two-hour infomercial so he's getting off

almost easy now, and if -- believe me, if he had the money to do the same to somebody else, he would. >> but it's not -- it's not just romney that's banging him. ron paul. >> fantastic. >> he's released some of the hardest hitting ad this time around. >> like little mini movies. >> here it is. >> newt gingrich renewed his support for an individual mandate. >> support for an individual mandate. folks, don't ask me to explain this. >> everything that gingrich railed against when he was in the house, he went the other way when he got paid to go the other way. >> he's demonstrating himself to be the very essence of the washington insiders. >> it's about serial hypocrisy. >> michael steele, people always say, you know, why all the negative ads. the answer because they work. >> they work, they work, brother. they work. they do, michael. >> especially when they are true though. >> well, it's -- it's not a question of what's true or what

isn't true. it's how it's packaged. it's how it's all put together in a series of little vignettes that -- that tell a different story or the same story or continue a narrative, and -- and that's really what it's all about. >> right. >> when you're doing these ads, can you take a fact, david, you can take a fact and you can make it say and untrue in another. >> in newt's case they don't have to do that, that's the thing. he's being hoisted on many of his own pitards. >> this is the broader point that should not be lost here. this is a level and a threshold where the voters go enough is a enough, and i think you're beginning to see that threshold being reached in iowa. when you're looking at 1,200 commercials being played in a 24-hour period in some cases. >> they are used to that when it comes to the iowa caucuses in new hampshire. >> but to your point, michael, this barrage of negative ads, it does -- it does have a down side of its own, and those who run

those ads need to be very, very careful. i think interestingly enough sitting on the wings is someone like a rick santorum who could benefit because those who play the ad could lose support and newt has lost support so santorum and bachmann are saying let the crumbs fall this way. >> let me show the gingrich response. he's vowed not to go negative. here's a morning in americaish kind of spot. >> these are challenging and important times for america. we want and deserve solutions. others seem to be more focused on attacks rather than moving the country forward. that's up to them. i believe bold ideas and new solutions will unleash america's creative spirit. when i was speaker, our budget was balanced, and 11 million jobs were created. we can do it again and rebuild the america we love. >> gentlemen, i'm limited on time. in a short answer can, that get it done, michael steele, you first?

>> can get it partly done, partly done but he needs to do more on the ground since he doesn't have the resources to be up on air. >> david corn, can the happy talk no? >> that ad is hollow. doesn't even propose any of his bold idea like lawnary colonies so i think people will say that and it's nothing to relate to, nothing to consider. >> it's a sad commentary though if only the bombast works. >> the specific stuff, positive specific ads can work, too. >> i'm not sure. negativity sells. >> david you're being very cynical and i think there's a little more to it than that. >> thank you, david corn, thank you, michael steele. >> up next, barney frank's advice to the colleagues that he's leaving behind. that's next in the sideshow. you're watching "hardball," only on msnbc.

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back to "hardball." now for the sideshow. first up, on the home stretch. if massachusetts representative barney frank was having any doubts about his decision to retire from congress at the end of his term, this week's debacle over the payroll tax extension probably serves as a really good convincer, and it looks like he's already fleshing out plans for when his time on capitol hill is up. frank took the time to make a blog post on the hill. quote, with more free time on my horizon, i have decided to diversify my activity, and as part of that i have compiled a retirement songbook which i will fill up with some of my new leisure time. what follows is the annotated version of the song titles, jingles and other fragments, suitly annotated, and here's some of the highlights that follow. to be chanted on the last day of the 112th congress. no more hearings, no more votes, no more out of context quotes. and there's there advice that frank received from a colleague on how to avoid looking awkward while marching in a parade. quote, take three steps and wave to the left, and then take three

steps and wave to the right. this sometimes resulted in my waving to telephone poles, fire hydrants and empty buildings, but it did make it easier to march without having to make difficult decisions about to whom and when to wave. i have merged two that seem to me very relative to my future plans. i love a parade, but i'm not marching anymore. i think it's safe to say that frank's countdown to retirement is officially on. next up, call it quits. that's just the topic of the phone call michele bachmann says she got from the ceo of the family leader, a christian conservative group in iowa. bachmann says that he suggested that she throw in the towel and then give her support to rick santorum. suffice to say she was less than on board. well, today apparently she got it wrong. >> there's several good pro-family candidates in the race and it would make the decision a lot easier if a couple would team up and basically form a team.

i talked to a few candidates and i said i'm not saying what you should do, i'm not telling you to drop out or anything of that nature, but maybe if you like another candidate, maybe you and the other candidate should get together and say, hey, can we make something work where it's a team deal. >> last i checked you can't run for president as a team, though the family leader organization opted not to endorse any of the 2012 candidates, he individually chose to go with rick santorum. up next, it 2012 the year we'll see a serious third-party candidate run for president? we've got new poll numbers showing who could be successful running as an independent and which major party benefits the most. you're watching "hardball," only on msnbc. progresso. it fits!

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your cnbc market wrap. the dow ends up four point. the s&p 500 gains two. however, the nasdaq fell by 26 points. the declines in tech shares were courtesy of oracle. the software giant's earnings missed estimates for the first time in a decade, and that sent the stock down 11%. in the housing sector, sales of previously owned homes rose 4% in november. prices were also up slightly, distressed property, foreclosures and short sales accounted for about 30% of the sales. bank of america has agreed to pay $335 million to settle allegations its countrywide credit unions discriminated against minority borrowers. it's the largest settlement in the history related to residential fair lending practices. b of a bought countrywide back in 2008 and the justice department has cleared the planned merger of excelon and constellation energy. that's the latest for cnbc,

first in business worldwide. now back to "hardball." welcome back to "hardball." today the republican presidential field shrank. the former new mexico governor gary johnson quit the party to run as libertarian but if more high-profile candidates like ron paul or jon huntsman make independent runs, new polls show that they could really hurt the republican nominee. even donald trump takes a big chunk from mitt romney in an obama/romney/trump three way. here's what worries republicans. ron paul on "meet the press" keeping his options open. >> are you ruling out a third-party run at any point? >> i have no plans to do that. >> are you ruling it out? i -- i'm not going to rule anything out or anything in. >> are you open to a third-party

run? >> i am not even thinking about it. >> but you won't rule it out completely? >> i have enough on my plate right now. >> look what could a third-party candidate do for a 2012 race? i want to show you some numbers. the new "washington post"/abc poll breaks down how a ron paul independent run could change the political dynamics of the campaign. in a head-to-head match, you've got president obama, mitt romney. they are tied at 47%. but now add ron paul to the mix, and he pulls far more voters from romney in a three-way matchup. it becomes obama 42, romney 32 and paul 21% and the poll played out the effect of a ron paul independent run in a obama/gingrich head-to-head

matchup where obama comes out on top 51-43 but in a three-way race it's 43% to 32% to ron paul 21%. that's a significant factor. >> i'm sure the white house is praying and hoping that that is what happens, that there's a third-party candidate that can chop off whoever the nominee's support is. i think democrats would really like that. whether or not that's going tonight actual result on election day if that indeed is the scenario, that's a little more undetermined. i think third-party candidates have huge hurdles could cross when it comes to getting on the ballots in a lot of states and the candidates need to be particularly well fund federal they are going to achieve that if that's going to be the result on election day. >> ken vogel, didn't rule it out certainly with david gregory? >> yeah, and ron paul, there are definitely enticements for him there to think about running as a third-party candidate. let's not forget in 2008 when he finished with 10% of the vote in the iowa caucus that he refused to endorse john mccain, the

eventual nominee for the republican party that year and even staged a counter rally to the republican national convention that coincided with the republican national convention, and this time he has more support in polls. he has more money. he has more infrastructure and he's really influenced the republican debate, the party and nominating process. in many ways he sort of gave birth to the tea party movement, and you hear a lot of republican candidates now talking about his issues, so if he's not the nominee and wants to continue that discussion, he has a couple of options. he can try to go to the convention with the delegate votes that he has and have a role in the platform or think about running as a third-party candidate. >> another wild card, the latest robo poll from a ppp survey shows in a head-to-head matchup between romney and obama, romney has a statistically insignificant lead, 47-45%, but now add the donald to the mix, and obama's number doesn't change at all. he's still at 45, but look at

romney. romney drops to 31%, and trump gets a fairly strong number at 19%. and -- and an independent run by jon huntsman would shave two points off of obama's support leaving him with 43%, but he takes a ten-point chunk out of romney's support dropping him to 37%. in other words, huntsman then is at 11%. i guess the common denominator here is if you throw in ron paul, if you throw in donald trump, if you throw in jon huntsman, it's to the benefit in each case of barack obama. >> you know, and that's what these numbers show. it is to the benefit of barack obama but let's think about which one of these candidates could actually mount a serious third-party bid. ron paul has a lot of support. he could find the fund raising to do it. in a lot of ways, jon huntsman will struggle with fund-raising unless he chips in some of his own money. donald trump, obviously money there not an issue but donald trump as a candidate. he takes a big chunk out of romney's support there, but i think if he runs as a national

candidate, voters are going to have a hard time stomaching him in the long run f.voters have issues with newt gingrich's three marriages, i can't imagine what they will think about. >> ken vogel, what about americans elect? there's another wild card. i'm convinced that we're going to have four candidates running in most states this year. that you'll have the "r." you'll have the "d," one of the factors they addressed. americans elect got on the ballot in california this week which i think makes the 12th state. that's a gargantuan task to get on that ballot and they have done that. what role might that play? >> that could play a major role, michael. when you talk about the hurdles that shira is mentioning in terms of ballot access and raising the amount of money, getting enough signatures to get on the ballot in 50 states, americans elect appears to be headed in that direction. california huge. they are also on the ballot in michigan, ohio, i think florida as well. those are huge states, and they

are going to have an impact, depending on which candidate wins their rather byzantine nominating process that they sort of hold up as the height of democracy, internet-based nominating process but the white house is expressing some concern about it, that the obama campaign, that is. they kind of tossed some cold water on it and suggested that it's a back room process. either way they can minimum wage make a major impact and both of the candidates in the ppp poll, potential candidate, independent candidates, jon huntsman and donald trump, their supporters have pushed them to seek this americans elect nomination. >> and i would say the reason the white house is throwing cold water on it, their candidate could draw from obama like the others do. when we come back i'll ask former pennsylvania governor ed rendell about what's happening in the payroll tax cut debate. you canful me on twitter, so

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we're still a long way from knowing who is going to win the republican nomination, but there's plenty of talk about possible republican running mates, and one possible veep whose stock is on the rise, republican governor susana martinez of new mexico. ppp ran a poll that found that martinez is the most pop laugher all republican governors elected last fall that. means she's competing against the likes of rick scott, john kasich and scott walker, but her approval rating is among the highest of any republican governor in the country, and she's doing in t in a state that voted for barack obama by 15 points in 2008. we'll be right back.

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welcome back to "hardball." tom ridge served five terms as a republican in the house of representatives, was a two-term governor of the great state of pennsylvania and the first homeland security in the nation's history. he knows washington. he knows politics and hi knows a party in trouble when he sees one, and right now that would appear to be the gop. hey, governor, great to have you back on "hardball." >> michael, nice to join you again. thanks for the invite. >> in those five terms in the house, did you ever see dysfunction like we're witnessing today? >> never. you know, i've tried to figure out over the period of time going back to the '80s when i was privileged to serve. you had ronald reagan, the president. you had tip o'neill, the liberal, bob michael the conservative and senators dole and mitchell in the senate, and there was so much respect and facility. there was hardball politics, but there were able to get things done and i'm trying to figure out whether it's the world war ii generation that provided the

leadership and we've just gotten away from it but it's kind of tragic when you've got one party, particularly president obama had the house and senate for two years and they operated for two years on a continuing resolution and the deficit get going higher and higher. rather remarkable what's going on out there. >> it looks like speaker boehner has lost control of his caucus. is that how it strikes you? >> i'm not quite sure. i think speaker boehner has a lot of challenges associated with being in the majority there and not the least of which is folks in the tea party and trying to get them to come to a consensus. i would like to think he keeps plodding along and doing the best that he can, and everybody in the party needs to understand that the american public, folks outside the beltway, frankly aren't happy with either party right now, are not happy with the president. you're sent to washington to solve problems. look, when the super committee was meeting to solve the deficit, it try to reduce the deficit by $1 trillion, a president running around the world when he should have been in washington dealing with the

super committee, using the bully pulpit. take a look at the senator reid, again, tried to give us a two or three-month tax cut instead of solving the problem. the problem is deficit, debt, deficit, debt. they are unlikely to solve that problem and the american public is getting tired of both parties not trying to solve it. >> it looks like pragmatism to my eye is in short supply on the gop side of the aisle and the 2012 race is a great illustration of what i'm talking about. there's such hostility towards president obama from a core republican constituency, but they don't appear to be looking for he or she who might best defeat barack obama in a general election. >> yeah. >> and perhaps all that angst and anger is going to get lost in primary season. >> yeah. >> you know to what i refer. >> absolutely, but i've got the answer for them. you know, i start by being governor ken strich, and i take a look at a governor with a great track record as governor, led the state in job creation and pew foundation said it's the best managed state, only

governor with foreign policy experience and the only candidate that the "wall street journal" says his economic plan is the best for the country, both short and long term, and someone who understands that america's future dealing with china and india. that individual is governor huntsman. a solid conservative, nonjudgmental, foreign policy experience unlike the rest of the field combined, and a heck of a record as governor. if they're looking for someone to win in november, and you know this is not ha 50-state election, we're down to eight or ten, jon huntsman is the answer. >> but they're going to look at somebody who will kneecap, and he, because of the civility, and i credit him with that, you know, he doesn't stack up in that category. >> well, you know, there may be some people within or party that are looking for somebody to use a blunt assault weapon on the president, but i must tell you, i think the public at large is looking for someone with a better idea, a proven track record, who can attract them not

only with the power of his ideas, but the civility with which he criticizes and confronts the president, and that candidate is jon huntsman. here are numbers from the most recent cnn poll, a matchup against mitt romney, the president now leads by seven percentage points by registered voters against newt gingrich leads by a remarkable 16 percentage points. it's important to point out that other polls show the hypothetical races to be closer. my observation is you have that wave that's moved from bachmann to perry to cain, now settling briefly on newt, but i would argue that none of those candidates can defeat barack obama in a general election. so the question is, are they going to ultimately go back to romney or your guy? >> i think that's a good question. i think we'll see jon huntsman who decided for many, many reasons not to contest iowa, has spent a great deal of time in new hampshire and south carolina. one of the challenges i think when you kind of distill the arguments for candidates

throughout, and we will respect them all. i know i do, and i know jon huntsman does, at the end of the day, who is the consistent principled conservative. what jon huntsman tells you on monday, he tells you the same thing on friday. who can best articulate an entirely different vision, a 21st century vision based upon our engagement with the part of the world we're ignoring now in both a touch and sensible kind of way i'm going to keep going babb to the arbiter of finance and economic plans, the "wall street journal" says if you really want somebody 20 do something effective, look at jon huntsman's plan. if you think about it being eight or ten states instead of 50, you have to be looking at governor huntsman. >> i'm going to lose you in a minute, does he need to win new mexico or a strong showing? >> i think a strong. several people have said second or third gets him in the limelight. there's been a winnowing of

other candidates, and at the end of the day it could be governor romney, speaker gingrich and jon huntsman. >> merry christmas, governor ridge. thank you for your work on the flight 93 memorial. >> i was going to thank you for your work. thank you, michael. when we return, let me finish with how the republican party's opposition is finally catching up to them. you're watching "hardball" only on msnbc. this was the gulf's best tourism season in years. all because so many people came to louisiana... they came to see us in florida...

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when the editorial page of "wall street journal" takes a shot at house republicans on a matter of tax policy, you know there's a seismic shift under way in washington, but that's what wednesday's paper delivered under the headline, how did republicans manage to lose the tax issue to obama? said the journal -- the gop leaders have somehow managed the remarkable feat of being blamed for opposing a one-year extension of a tax holiday that they are surely going to pass. this is no easy double play. superficially then, this is about whether the payroll tax will be extended for two months. two months? not really. this has much more to do with the continued recass trance of house republicans whose primary objective is to oppose what's obama wants. even when he takes a place out of their playbook, a tax cut, their visceral reaction is to oppose it. this is about the personal, not 9 policy. the journal itself reminded

readers over in the senate minority leader mitch mcconnell said earlier this year his main task in the 112th congress was to make sure that president obama would not be reelected. it was at least an honest statement. think about that. following the republican party's huge gains in 2010, his top priority was not to rein in the debt, not to end two wars with honor. his main task has been to focus on thwarting president obama's reelection. in this regard he's only parroting a number of pundits who seem to give the marches orders, and ironically this venom gets spewed among like-minded critics who great laid one another on their respectively patriotism. there's a constituency for this anger. it represents a small but loyal core of the party, shifting from bachmann to perry to cain to newt, looking for a pujleist to

step into the ring with obama next year. you're wondering why mitt romney is leading, but can't close the deal? it's because he's heretoforen unwilling to knee the president in a groin demanded by this crowd, the same crowd to which the house gop is responding by fighting over a two-month extension of a payroll tax cut. something interesting has happened along the way. while the stop obama at any cost mentality has gripped the gop-controlled house, congressional approval numbers have tanked down to 11%, and meanwhile, the president's numbers have gone up. the "wall street journal" today recommended that the republicans, quote, would do best to cut their losses and find a way to extend the payroll holiday quickly, then go home and return in january with a united house/senate strategy that forces democrats to make specific policy choices that highlight the differences between the parties on spending, taxes and regulation. how about