How will GOP, Dems compromise in the next term?

>>> ryan for all that he has done for our campaign. and for our country. besides my wife, ann, paul is the best choice i've ever made. and i trust that his intellect and his hard work and his commitment to principle will continue to contribute to the good of our nation.

>> i want to thank my friend and partner of the last four years, america's happy warrior, the best vice president anybody could ever hope for, joe biden !

>> all right. welcome back. 29 past the hour. a special post-election edition of " morning joe " live from studio 8h in rockefeller center .

>> by the way, look who's here. this is huge.

>> joining nous, nbc chief foreign affairs , andrea mitchell . political analyst and former chairman of the republican national committee , michael steele . and msnbc political analyst and visiting professor at nyu, former democratic congressman harold ford jr . and host of " mad money " on cnbc, jim cramer .

>> and by the way, andrea mitchell , thank you guys for coming. andrea mitchell came up to me, mika, spoken like a true lawyer, she said, i believe that for you to grow your mustache, the president had to win florida and north carolina .

>> so how are we?

>> oh, oh.

>> i don't think that's true, but i'm going to talk to my lawy lawyers. but thank you for trying. i think that's supporting.

>> i think when axelrod comes on thursday, we ought to try and negotiate with him. and since the new era of bipartisanship has begun --

>> yes.

>> -- perhaps he could use your relationship with him as an example. so i will mediate.

>> i doubt it. i doubt it very much.

>> i think we can get something done. i think i can work it out.

>> so harold, what do you think? historic night.

>> historic night. hopefully it translates into all the things that have been talked about this morning, especially as it relates to bipartisanship, especially as it relates to a magnanimous tone being struck by both sides. i was most struck by two things, one, the president's tone last night suggests in the most powerful and compelling ways, it was gracious and hopefully republicans match it, although if you listened to the rhetoric from some in the house . in the senate, democrats picked up seats which i think surprised many. and if you look at where the states were picked up, montana, it looks more like democrats may win that seat. in north dakota , it's a positive thing for the country in many ways. hopefully it translates into us getting a deal around the fiscal cliff, the proverbial tax cuts and sequestration. and i'm hopeful that it sets a tone for energy and immigration to be dealt with which i would imagine, michael , republicans have to be eager to deal with right away.

>> michael , let me ask you, two years ago, you were chairman of the republican national committee .

>> yep.

>> republicans won the largest landslide in recent history.

>> yeah.

>> nationwide picked up 700 seats across state legislatures . the most republicans picked up in the house since 1946 . what happened over the past two years? what caused this collapse? other than, of course, you leaving the rnc.

>> well, yeah, that was part of it, i'm sure.

>> yeah.

>> no, i think part of it was looking back on it, what we inherited was the ash heap of 2006 , 2008 . and what we discovered was, we stopped talking to people. we stopped communicating values and ideas, accepting people where they were. if you go back and you look at those two years, joe, and you covered my tenure at the rnc just like everybody else , you didn't have conversations about vaginal insertions and --

>> right.

>> thank god.

>> contraceptions.

>> mighty early to be using those words.

>> probe.

>> pro.

>> use the operative word here.

>> thank you.

>> actually, state-sanctioned probe. you know what? maybe we should just steer it. point taken.

>> point taken. no, but the point was, we were talking about the things that people were concerned about. we got off of that conversation, and we got into these other areas where people felt threatened by the language, the tone and how we stopped embracing america as we found it. so i think that was a big part of the breakdown. and then, of course, just the overall messaging on the economy, just didn't connect.

>> didn't connect. andrea .

>> there were so many advantages that mitt romney had on the economy going in. i think the jeep ad was a disaster. you have two ceos basically calling him a liar. that did not help in ohio . but i do agree completely with michael about the values. you cannot ignore the values of mainstream americans . you can't ignore women. and you can't ignore the hispanic and minority communities and speak to them the way they were spoken to by some of these candidates, by mourdock, akin, and that became sort of the overwhelming tone.

>> even by mitt romney . sorry.

>> no doubt about it. craig shirley had said, and i've quoted him, that november football games are won in august.

>> yeah.

>> well, in this case, you could even say a november game was won back in the early spring when mitt romney decided that he was going to dart as far right as humanly possible, jim cramer , on immigrati immigration. and he tried to go to the right of rick perry . it may have helped him win votes in the primary in the short run. in the long run, you could see it early last night. the exit polls came in. we heard there were more hispanics voting in virginia this time than four years ago. colorado, more this time than four years ago. mitt romney got crushed by the hispanic vote. if he had had the same percentage of hispanic votes that george w. bush had in 2000 or 2004 , he would be president of the united states this morning.

>> absolutely. see, andrea 's so right. i think romney went mathematic, but remember, you could do all sorts of different kinds of project orca, trying to get the last-minute vote, trying to be -- they call it that, for heaven's sake. but in the end, the arithmetic was we're a changed country. the country doesn't look like when i grew up. i'm 57 and the country that romney appeals to is long gone. it doesn't look like us.

>> you go back, ronald reagan , we always talk about ronald reagan 's historic landslide in 1980 . mika, you do the demographic breakdown from 1980 and put that in last night's voting group, and ronald reagan would have lost in a landslide. it is a new republican party . this is something that george w. bush and jeb bush saw in 1996 , 1998 . they warned republicans about it for some time. and last night, they paid a heavy price for not listening.

>> they paid the hard way. it is a race you could argue they should have won.

>> oh, my gosh. seriously? we had to work overtime to do this! mitt romney said that he and paul ryan left everything on the field? really?

>> no.

>> not even close!

>> they pushed it farther away .

>> what does this mean when so much -- if you remember what mitt romney said the first thing he'd do would be to undo the obama health care plan. does this take that substantively in your mind off the table somewhat, and with so many other important issues including the fiscal cliff, but does now the affordable care act , the supreme court has spoken, the voters have spoken, does this mean that we accept it as law?

>> i think so.

>> politically.

>> i think they fix it around the edges.

>> but they were going to.

>> you don't ask me what's going to happen over the next four years. you only have to go back to see what happened when we were there. and i've been saying this for two years now. it's identical. again, i'll say it again. in 1992 , you had a new democrat come in. he went too far left . in 1994 , americans spoke out, moved back to the right. two years later, that republican party went too far right. the american people spoke. and they re-elected that new democrat and gave him another four years. and then the two sides figured out how to work together on welfare reform , on balancing the budget for the first time in a generation, balancing the budget first time for four years since the 1920s , did a lot of great things. that can happen again. but republicans and democrats need to understand they've got to work together to do it.

>> let's go to "politico." with us from headquarters in virginia, chief white house correspondent for "politico," mike allen . and mike, we were trying to skype with you late last night. we were able to skype with my brother in sweden with absolutely no technical problems.

>> but not "politico" in arlington.

>> but with you it's a disaster. that's all i have to say. good morning, mike.

>> good morning and thank you for trying. the shot looked great. your coverage was amazing. thank you very much. we had a good time over at the newseum. we had a watch party with about 1,000 people.

>> wow, fantastic!

>> what's your takeaway from last night?

>> one of our big takeaways is that republicans are going to have to find a new way to get senate candidates. and we've learned that starting today, top senate leaders are going to be meeting with some of the outside groups around washington to try and get them to serve as a little bit of a screening committee so that they don't get these unelectable candidates. just as mitt romney lost in an unlosable race, as you point out, a number of these senate candidates also lost unlosable races. looking ahead a little bit, here today in washington , we're going to see the battle lines drawn on the if is cal cliff fight. at 3:30 today, speaker boehner is going to go out, and he's going to say that this was a status quo election, a democrat in the white house , democrats in the senate. him, republicans in the house , and that this is a mandate for common ground on tax reform , not a mandate for republicans to cave. the white house is going to say, look. the president went around the country saying how he wanted to fix the fiscal cliff, saying that he wanted to raise taxes on people who make the most money. and it's no surprise they have a mandate to do it, but speaker boehner drawing a very hard line -- hard opening line saying that he would not forget the $250,000 or more that they've been talking about raising taxes on. he says he wouldn't go for raising taxes on someone who makes $1 million or more. that's not someone who is chastined by last night's results.

>> of course, republicans , jim cramer , are going to say the same thing the president says. i've got a mandate because they certainly ran in their seats, promising not to raise taxes. so we're going to have to have some compromise here. how are the markets going to react?

>> i think the markets are going to be fine because there was a last-minute surge that brought people into the coal stocks. a couple of very isolated stocks that people felt some naval defense stocks. but the thing i'm worried about here is what i call -- i know chris matthews is here -- the outlaw josie wales factor.

>> great movie.

>> yes. remember what they were really about. they thought that the confederacy had won or was going to win. on air last night, while we were getting results, we had people coming on said this is a great romney victory. just wait and see. what was i waiting for? for guam?

>> can i just tell you, a lot of us felt like, you know, going into the old peanuts analogy, we were sitting in the pumpkin patch waiting for the great pumpkin to rise.

>> i love that. better than josie wales.

>> it never came. we heard about that. but you know, jim, i was talking to romney people on saturday. they were really charged. we were talking about this yesterday morning. they believed they were going to win. they had the momentum.

>> there was something stirring.

>> by sunday night, they were all flat. they had gotten the polls in. they weren't moving in ohio . they weren't moving in pennsylvania. and they felt at that point they were flattened by sandy. i don't think this race was close enough to be impacted by a hurricane.

>> no.

>> but that's certainly what they believe.

>> chris christie , yes, springsteen's his buddy, and springsteen may have brought him over. i think that people -- i was in ohio a couple weeks ago. you know, there's great wealth in ohio . there are companies that have given out billions of dollars to people in ohio because there's oil and gas everywhere. and the whole northeast ohio was flooded withal abouts of dollars of oil money. those people are not unhappy.

>> andrea , we saw it early on, and we were talking about how the right track/wrong track in ohio shifted six months ago. mitt romney , i think, one of the pivotal moments when mitt romney told john kasich , stop bragging about your economy in ohio . ohio was a leading indicator .

>> it was a leading indicator . you know, the other thing about that mitigates against agreement is the people who were elected in the house , and they picked up seats. the democrats did miserably. i think you may see a change in leadership on the democratic side, as a matter of fact. nancy pelosi --

>> would that be good or bad?

>> i don't know. she may decide not to run for a leadership position after this particular election. but the point is that these people who have been elected on the house side feel, as you've just said, that they've got a mandate not to compromise. and unless the, you know, the senators who have been trying to do something, coburn and others and people -- rather the --

>> the gang of six.

>> the gang of six who can get together, mark warner and lamar alexander and bob corker and very conciliatory statement from --

>> from them.

>> from them and from some of the other senators on the republican side last night.

>> mike allen , we're talking about mandates. and i can tell you, i don't know if you knew this or not, but i ran for congress.

>> oh, my gosh. really?

>> harold ford --

>> breaking news.

>> breaking news. but when i ran in '94, i ran against bill clinton , when i ran in '96, i ran against bill clinton . bill clinton got re-elected. but when i went to washington , my mandate was not to follow bill clinton . it was to do what i promised to do on the campaign trail. i think sometimes we do forget, because we're all looking at the big race, that these people that go to congress go there with their own personal mandate with their people, with their 600,000 constituents. that's why we have divided government. that's why we have to compromise.

>> well, that's right. and something that makes another impediment to getting a deal is that these people who are coming to congress now are even less beholden to their leaders than ever because they have their own sources of fund-raising, their own sources of media. and so it's much more difficult for speaker boehner to corral those republicans . picking up on andrea 's point, another huge impediment to the deal. you know how now have paul ryan coming back to the house . he has more credibility, more sway with the conservatives than anyone. and now he's probably running for president. and if paul ryan is running for president from the house , he is going to have no incentive to make a deal with president obama . it's a big deal , and it's a factor that could really mitigate against any kind of a quick deal.

>> interesting new dynamic there. mike allen , ladies and gentlemen , mike allen . thank you very much.

>> mike, thank you.

>> great coverage. thank y'all.

>>> coming up, chris matthews and mark mckinnon will be here. also, the reverend al sharpton . republican strategist steve schmidt and margaret carlson . andrea mitchell , thank you very much. she was up all night. up all night.

>> thank you, andrea .

>> thank you, andrea . and who? bye-bye, cramer. thank you so much. jim cramer , everybody. you're watching the special post-election edition of " morning joe " live from studio 8h. we'll be right back.

>>> we have may have battled fiercely, but it's only because we love this country deeply, that we care so strongly about its future. george and lenore to their son, mitt, they have chosen to give back, and that is a legacy that we honor and applaud tonight. no, no, no,