(This is from last night's "The Ed Show" on MSNBC. Ed Schultz is probably tougher on Obama than any other of their hosts, including Rachel Maddow. Lanny Davis was Clinton's White House counsel and a thorough scumbag. He was hired by the Honduras junta as a lobbyist. After interviewing him, Schultz brings on Jane Hamsher, the Firedoglake blogger who has been leading the liberal pack in differentiating herself from Obama. She simply points out how Davis is on the payroll of drug and insurance companies. Priceless stuff.)

SCHULTZ: Welcome back to THE ED SHOW. Thanks for watching tonight. The Obama White House is pretty much getting hammer over this health care capitulation. The progressives pretty furious. Now, some are accusing the progressives of being traitors. The left is not betraying the Obama White House. They are fighting for what they were promised, real health care reform.

I don`t think being a good Democrat means lining up behind a bad plan. My friend, Lanny Davis, disagrees with that. He wrote that the left is really a circular firing squad, and also has got hateful, suicide impulses. Holy smokes, Lanny. Were you mad at somebody when you wrote this?

Good to have you with us, buddy. I appreciate your time tonight. I will definitely tell you, you are telling it like it is. No doubt. At least from your perspective, my friend.

LANNY DAVIS, DEMOCRATIC STRATEGIST: I`m never mad at you, even when I think you are wrong, because we are both liberals. And the left I was talking about was the left who is attacking Barack Obama and attacking all the liberals in the Democratic Senate. There are great liberals in the Senate who are supporting this bill.

SCHULTZ: Who is attacking the president?

DAVIS: And Bill Clinton.

SCHULTZ: Who is attacking the president?

DAVIS: Well, I`ve certainly heard Howard Dean on television this morning saying that we need to kill this bill. And I didn`t say attacking the president personally. I`m saying opposing President Obama`s` position, Bill Clinton`s position, and the position of every liberal Democrat in the Senate, that this is a good bill. This is an important bill to get done this year. We can always improve it next year.

So, it`s a disagreement among liberals as to whether it`s worth going forward on what we think, Bill Clinton thinks, Barack Obama thinks, every liberal in the Senate thinks, I think, is a good enough bill to go forward with. We can always improve it next year, if we get it done this year.

SCHULTZ: OK. Well, I don`t know how you are going to improve it next year, when it doesn`t even go into effect until 2014. But Lanny, let me ask you, philosophically, do you really believe that it is a radical position to want a public option?

DAVIS: No.

SCHULTZ: You don`t? Well, then why not fight for it? I mean, there`s a lot of people in the media that are saying, well, the left is rebelling and that, you know, we are terrorists, and we are going after this. Come on, this is not a radical position, when the majority of Americans want a public option. Is it too much to expect that the Democrats that got elected go in and fight for this?

DAVIS: Our only disagreement here -- I happen to support the public option. Our only disagreement is that Barack Obama supported the public option. All the Democrats in the Senate that are liberals supported it. But at some point in time, we -- and we disagree with you, respectfully -- have made the judgment that now is the time to get what we can with 60 votes, that would allow 30 million uninsured people to become insured. Who speaks for uninsured? Well, I am speaking for them. They need that insurance.

SCHULTZ: And who is speaking for the insurance industry that is giving them all these customers?

DAVIS: -- preconditions can be denied. This is a very important step forward for the country.

SCHULTZ: Now, Lanny, first of all, how many insurance commissioners are we going to have at every state to monitor that? These guys are experts at getting away with this kind of stuff. They are experts at denying it. I think logistically being able to monitor what these insurance companies are doing is going to be extremely hard. But I also want to point out that you have said in your column that to compare prices, encouraging competing companies -- where`s the competition, Lanny? We got the oversight being done by the private sector on this.

DAVIS: Well, this is compared to what now? We have, for the very first time in our history, if this bill passes, 30 million uninsured people who can`t afford insurance, who rely on public hospital emergency rooms --

SCHULTZ: That`s good. That`s good.

DAVIS: Number two, no insurance company can deny coverage because of preconditions. That`s a fact. And number three, for the first time, we will have every private insurance company required to post their policies transparently on a public exchange, on the Internet, where people can price compare, and where insurance commissioners will be in a better position to regulate.

SCHULTZ: But that doesn`t force competition. Have you ever -- I`m sure you put out bids before to insurance companies. It`s amazing how they all come back the same, Lanny. We got to have a mechanism in place that`s going to hold these rates down, or these rates are going to skyrocket. And I don`t trust these very people that have been gouging us for the last ten years that are going to, all of a sudden, be honest brokers with the American people and they are going to be good stewards. It`s sellout and it`s handing customers to the private insurance.

Heck, how about if somebody called your law firm up, Lanny, and said, you know what, you got 40 million new cases. You would be hiring a bunch of people. Come on. You can`t get around that. This is not reform. It`s changes, I`ll give you that. But it`s not reform.

DAVIS: All right. Well, look, you and I have a disagreement, but it is not a big one. You think it is not good enough to pass this year. I think it is good enough to get it passed this year, when we have a chance of insuring 30 million people, and forcing insurance companies to cover everyone. And next year or --

SCHULTZ: At what price? You are going to force them to cover everybody at what price? We have another element of your column. You called Jane Hamsher notorious. Holy smokes. Let me bring in Jane Hamsher from FireDogLake.Com. Let`s settle this score right now. Jane, good to have you with us tonight. Why are you notorious. You went after Joe Lieberman`s wife, making a connection that she, of course, was connected to the pharmaceutical lobby. How do you feel about what Lanny wrote about ya?

JANE HAMSHER, FIREDOGLAKE.COM: Well, I think that you said it was a family feud, and Uncle Lanny needs to be a little bit more transparent about who he represents. He happens to be a partner in the firm of McDermott, Will and Embry, who have a lot of pharmaceutical clients as well. The Senate lobbying database says he represents Eli Lilly, Johnson & Johnson, Novartis and Sanofi-Aventis.

So I think if you are going to be on here advocating for the passage of this bill, when these companies stand to make a tremendous amount of money, that is incumbent upon you to say you are here doing that, Lanny. I mean, you went out and criticized -- you did the same thing. You have the shtick of attacking progressives for standing up for what they believe in on behalf of these corporations, who pay to you spew venom at them. You did the same thing for John Mackey of Whole Foods, when you weren`t transparent about the fact that he was a client of yours, when you went after progressives for attacking an op-ed that he had.

So in the same way that we`re asking, what about Lieberman, who has no skills about breast cancer, that would make them want to pay her something natively -- we`re asking questions about money that goes through to her husband`s pockets for his views on pharmaceutical stuff. Same thing for you. You are here today representing something that will make your client a lot of money. What is up with that?

SCHULTZ: Lanny, you have the floor. Lanny, you`ve got the floor.

DAVIS: Thanks. That was quite a long presentation, so I will try to be respectful. I won`t call her Aunt Jane. I`m happy to be uncle.

SCHULTZ: Well, did you write that she is notorious, Lanny. That is pretty tough.

DAVIS: Let me respond. She is notorious for using a black face on the Internet, which was a racist stereotype that she tried apologize. That is what makes her notorious. I was specific about that fact. She also called for the firing of Hadassa Lieberman, because she used to work for drug companies.

HAMSHER: Who`s paying you, Lanny? Who is paying you to be here?

SCHULTZ: I did not interrupt you. This is the difference, Jane, between you and me. I listened to you carefully --

HAMSHER: You are bringing up stuff that is three years old --

SCHULTZ: You are now proving the reason why people see you as personalizing and demonizing people. You aren`t even allowed to --

HAMSHER: Answer the question, who is paying you?

SCHULTZ: Let him answer, Jane.

DAVIS: Ed, I want your audience just to see the technique that, first of all.

SCHULTZ: We are going to let you answer. Answer that. Lanny, do you represent people that are going to profit from this health care bill?

DAVIS: Um, I do not have clients that Jane named.

HAMSHER: You are a partner in the law firm and you enjoy the profits, yes?

SCHULTZ: You said that Jane. Let him finish.

DAVIS: Not only did she say that, but she repeats herself over and over again by attacking personally. You notice she didn`t deal with the merits of what I said. The fact is that Barack Obama, Bill Clinton and every liberal in the Senate, including Russ Feingold, including Ron Wyden, including everybody we admire, you and me, Ed, is supporting passage of this bill. But Jane Hamsher can`t deal with the merits. She has to demonize people. That`s why she used black face and was denounced by every liberal I know.

SCHULTZ: But Lanny, isn`t --

DAVIS: -- rather than dealing with the issues.

SCHULTZ: But Lanny, is it a circular firing squad if progressives support what`s a part of the party platform, which is universal health care for all Americans? And this is a sellout. The progressive community thinks that this is a sellout to big insurance. Now, is that a circular firing squad?

DAVIS: Here is what I mean by a circular firing squad: it`s OK -- and I agree with a lot of the positions of disappointment in this bill. But it is a circular firing squad and Barack Obama would say and Bill Clinton would say, two former Democratic -- one former Democratic president, our current president -- that defeating this bill, with all the good that`s in it, is a way of the Democrats hurting themselves and possibly committing political suicide.

And I say one more time, who speaks for the 30 million uninsured who fear bankruptcy? Not you, who has insurance? Not me, who has insurance. That is what we need to worry about.

SCHULTZ: Lanny, the base is peeling off from this president because he has been a let down when it comes to -- it is enough to make a difference.

DAVIS: Not much.

SCHULTZ: Lanny, I got to run.

(CROSS TALK)

SCHULTZ: Good to have you with us tonight. Appreciate your time.
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