Can both sides compromise for the good of the country?

>>> obama to boehner , get serious. let's play "hardball."

>>> good evening. i'm chris matthews in washington. let me start tonight with this. the republicans have their plan and it's great news for the rich. speaker john boehner just put it out. those at the top, the 2%, are safe. your bush tack cuts are going keep on giving. one problem, mr. boehner , you lost. that was injure position before the election, and you lost. mitt romney campaigned on keeping the tax cuts for the wealthy, and he lost. and he promised to do what john bain ser doing right now, and he lost. how about some respect for the electorate? how about seeing what the 2012 presidential debate was about? obama championed tax fairness and won. republicans championed protecting that 2%, ignoring the 47% he talked about, and they lost. today boehner said he's willing to raise revenues by the same amount he agreed to back in august of 2011 , the last time they had this fight. again, he's willing to act like the election never happened. no wonder. again, he lost. joining me is joy reid of the grio and howard fineman of the " huffington post ." joy, you're chuckling because it is weirdly true. it's almost like groundhog day , this guy, boehner , ice not a bad guy , but he's operating on a bad thought here. the election didn't happen.

>> it's incredible. it's amazing watching john boehner reach for anything, simpson/bowles which, by the way, assumed that the tax cuts for the top 2% would be gone, but he forgets about that and bain ser trying to offer the same exact policies that mitt romney ran and lost on, that the republicans tried to negotiate with the white house . it is incredible. and the only way i can explain this, the only way i can possibly figure it is that maybe boehner feels like he has to protect his caucus to the end, look like he fought to the last dog died for those two 2% rates because then when he caves at the end, which he's going to have to do, he can at least say he tried.

>> right. by the way, the white house has rejected his latest offer which is where he was in august of 2011 . by the way, here is the details of what boehner put forward. consists of $2.2 trillion in net savings over a decade. it would include $800 billion worth of revenue from changing the tax code . but not by raising rates. by the way, the same figure that they both greed on back in august of 2011 during the last dead fight. another $1.2 trillion in the plan would come from other programs including medicare and medicaid as well as discretionary spending. that's appropriations. republicans would also make changes to the consumer price index . now, their monkeying with that cpi this time. they had reduce medicare and social security benefits which they say would save another $200 billion. that will be interesting to fiddle with that one. later this afternoon the white house rejected the boehner offer saying in part, quote, the republican letter released today does not meet the test of balance. in fact, it actually promises to lower rates for the wealthy and sticks the middle class with the bill. their plan includes nothing new and provides to details on which deductions they would eliminate, which lope holes they would close, or which immediate care savings they would achieve to. you know this stuff so well. do they seriously propose at this point in our political history after this resounding election, a clear election with a result and a winner and a loser, romney is off in dell hoya somewhere riding roller costers, that they would come out and say not only are we going to protect the top 2% but we're going to give a tax cut .

>> yeah, that's their idea of tax reform . that's what tax reform is all about.

>> ludicrous.

>> it's a bargaining position and i think joy might be right about what boehner is up to here. but it's also what they believe, and it's also what they are clinging to. you know how the president was once criticized for talking about people clinging to their guns and their religion?

>> rightfully so actually.

>> yes. okay. these people are clinging to this idea because it's all that's left. it's the only thing they have that they can identify with as a core republican belief, that -- it's a matter of faith that they're clinging to, and the white house is saying, the numbers will not add up in any other way unless you change the top rates. you have to change the top rates. i talked to jay carney just a little while ago --

>> it doesn't work mathematically.

>> he said it just can't work. even though they don't want to, the white house says they don't want to let the bush tax cuts expire and have everybody's taxes go up, if we go into next january, if we go to the next congress, which is more democrats in both the house and the senate, i think this white house will be willing to take its chances that they can pass a bill to cut taxes again for the middle class and leave the rates expired for the top. that's their ace in the hole strategy.

>> that's a dangerous game though. you do not know what the world markets are going to do. they're watching this in tokyo, in hong kong , they're going these maens can't get their act together. let's get back to the equity issue. i sometimes think -- remember the british -- the raj days of the indian army all fighting for british rule but it was the indian army fighting for british rule . is that the republican party ? is that who they are? they're not 2%. the republican party is not 2% but yet half the country almost, 47%, are still out there fighting for that top 2%. they're the gurkha army.

>> it's amazing.

>> why are they doing this?

>> you sound like you have just described the tea party . that's what i think the tea party .

>> they're not rich.

>> a bunch of guys middle class themselves fighting to the last dog dies making sure rich people get their tax cuts . its incredible. they will say it's because i never got a job from a poor guy. okay. but if you give somebody who has millions and millions of dollars another $100,000 they're not going to spend it into the economy and hire someone, they're going to send it to the caymans which is what mitt romney did with his tax cuts . that's what they're going to do. the economic theory is not sound. if you give somebody with $50,000 another $1,000, they're going to spend it.

>> at christmastime instead of a working stiff gets $50 for a thank you, they gave their 50 bucks to the boss. is that how --

>> by the way, a long time before the tea party existed or had a name, grover norquist , the famous anti-tax lobbyist in washington, was running around beginning to enforce ayatollah-style his edict about taxes, and he got republicans beginning back in the '80s to sign these tax pledges, which, as i say, that tax pledge has really become the core identity of the modern conservative republican party.

>> okay. we got a new candidate fred barnes , he's a smart conservative. he's not some crazy. he would like to give the tax cut at a million. here is what he wants to do. an increase in the individual income tax rate for the affluent may be unavoileable. obama did spend the last two years proselytizing for such a hike and voters were well aware of it when they re-elected him. but the white house has said that the rates don't have to return to clinton era levels. obama 's nemesis as he often told us are millionaires and billionaires. so why not urge that the higher tax rates be applied only to those with incomes of $1 million and not the couples earning more than $250,000. now, i'm talking pure politics, not equity in this case. can they hang their hat on the fact, okay, you're against millionaires, we'll take back their cut for the millionaires? below that they have to get the deal.

>> the problem with this is chuck schumer and other senate democrats tried to offer this to republicans last time. remember the last time we did this they rejected it.

>> it works for them now. they can say all we want is the schumer deal.

>> right now they don't have the leverage to get the schumer deal. they rejected the schumer deal. they don't have the leverage to get it.

>> here we disagree. i think they may have a case. if the bogey man is the millionaire --

>> i think that's where it's going to end up. i think that's the flektability in the negotiations at the end is over to whom the higher rates apply.

>> but they don't raise that much money if you do it this way.

>> it's true. it's a sliding scale. the higher up you go, the less money you raise.

>> is it a debt reduction thing or an he can quit thing at that point?

>> for the president it's both about the arithmetic and about the point. it's about the point of everybody paying their fair share .

>> let's talk nor about where we're at. people tuned to find out where it's at. roughly speaking what happened on sunday is geithner, smart guy , no the a political guy at all. he's kind of soft-spoken, unlike some of us, me especially, so he goes on the sunday shows. he does a full ginsburg because that was monica --

>> all the shows.

>> lewinsky.

>> her father.

>> the lawyer, not the father. they made the point over the weekend where they stood. basically the administration position is clear. we want the rich to pay their share. listen to the voters, respect the voters. today the republicans came out and said, no, we don't hear that in the voters out there. the house rb re-elected republican so all we're going to do is go back to where we were the last time we were head to head and offer an $800 billion tax increase but we're not say wrg it's coming from and we're going to throw in some tax cuts for the rich besides. the white house came back late this afternoon before we went on the air, about five minutes before we hit the air and said, no deal. this is no deal because all it is is more breaks for the rich. it's not giving anything on what this election was about. so where are we at?

>> we're nowhere. boehner keeps saying we offered revenue. just like before the election they won't specify where the revenue comes from. are you going to go after the deductions for health care . sock it to the elderly and the tax treatment of medicare. they won't be specific. they say the white house won't be specific. i think lindsay graham is probably right, we're not going to be able to get a deal by the end of the year because each have staked out negotiating positions that the other cannot possibly accept.

>> i don't believe this deduction thing. i don't buy this. the minute you come out and tang away charitable deductions every philanthropic --

>> you can't do it.

>> it's never going to happen. i know the white house people are planning to leave town starting on the 23rd, 22nd, 23rd. they're all saying, hey, we're out of here. there's no deal.

>> what does that mean?

>> i think they're willing to say, i know you're concerned about world markets.

>> i'm worried about the way the woshth looks at us.

>> i think the world markets are sophisticated about who we are and the way we operate --

>> what, that we're clownish?

>> no, that we'll push the argument as long as we possibly can. and there is a case to be made that the president and the democrats will be in a stronger position when the new congress arrives. and i think even though this is not their favorite -- favored outcome, that the white house is willing to roll the dice on that and they're willing to wait until january and allow the bush tax cuts to expire.

>> i think it's playing a very dangerous game . you saw what happened -- joy --

>> i'm with howard.

>> i'm against both of you on this because i saw what happened in august of went on last time. and we had a credit downgrade and what we're worth in the world . we are the currency of the world . we have a responsibility to the world . i don't want to sound too grown up here but i am and i do worry about the president of the united states is the leader of this country. the democratic party is the government party and the governing party. if the republicans want to play british parliamentary politics and vote as a unit against anything good, that's a screw up.

>> look at it from the president' point of view. he ran on this for the last two years and he's --

>> shove it down their throat before christmas.

>> we have two problems. one, we look ungovernable. i'm with you on that, chris. we look we have a party that will not allow the president to assume the governing authority he earned with an election. on the other hand, i think the world markets would -- have priced in, we disagree on that -- we can get away with -- the deal will eventually get done. exactly. that's the exact point. i think the markets believe we will eventually do the deal. it's just whether we do it before or after january 3rd .

>> when you pay your bills on time you're impressive, when you pay them late, you're not. anyway, thank you.

>>> coming up, maybe grover is not over. there's a great phrase. for a couple weeks republicans could be seen saying they were no longer bound, human bondage, to grover norquist , but lately some of them have been quietly over the telephone slithering back into grover 's embrace. this is embarrassing for some of these senators. they come out against the guy and say it doesn't matter, then sneak back in on the phone p.m. i'm sorry, grover , i'm sorry.

>>> plus the election is over but it could already be beginning for 2016 . let's watch.

>> i can tell you, i don't think we've heard the last of hillary clinton . girl you're amazing just the way you are

>> i just have an instinct that the best is yet to come.

>> a lot of basking in that by the secretary of state. i saw that video, it looks like she enjoyed the proposal that she run for president. we'll be back with that later.

>>> republicans are still stunned over what happened on election day . they plame the urban vote. i love these codes. the underclass. they really are talking about america today. get used to it. those are the people that voted for president obama . americans. they're stunned because they hate obama and only talk to other republicans who also hate obama . get it? they're in this bubble and when the bubble bursts, they start to cry.

>>> finally, let me finish with how the nobodies finally won, and this is "hardball," the