MALVEAUX: How would the GOP grade President Obama in his 200 day mark?

Well, joining me now, the chairman of the Republican National Committee, Michael Steele.

Good to have you here on THE SITUATION ROOM.

MICHAEL STEELE, CHAIRMAN, REPUBLICAN NATIONAL COMMITTEE: Thanks, Suzanne.

MALVEAUX: You've seen some of the grades he -- for health care. He predominantly got a B there and we saw some Cs overall.

Let's -- let's start -- how would you grade the president?

Let's go first to, let's say, the economy overall.

What do you -- what do you think the president is performing...

STEELE: Well, I think the economy overall...

MALVEAUX: How do you think he's performing?

STEELE: Yes, I think you're king of looking at somewhere around the C minus area, I mean, because there's still a lot of pieces that need to get filled in. I think the stimulus was obviously bad policy right off the bat, right out of the box. But, you know, again, there's not a whole lot to judge it against in such a short period of time.

I think that there are many factors that went into where we are right now beyond just what the president has said he's going to do -- some of the things that he's done, some of the votes that have been taken.

I think right now, though, the strength we see in the economy is what from what the Congress and what the president is not doing. It is the market saying, you know guys, don't -- don't help us. You know, we can work this out. Markets have a way of -- of working through these things. Let us do that and a little less government intervention goes a long way. I think that's probably some of the -- some of the grading that you see on the economy, may come from the market saying, well, we've got this, we don't need government taking part in it.

MALVEAUX: You don't see, perhaps, the raise in home sales or the Dow -- the level of the Dow -- or even the GDP raising as any part of this -- the result of the stimulus package or anything...

STEELE: No, I don't.

MALVEAUX: (INAUDIBLE) administration?

STEELE: No, I don't, Suzanne, because we've only spent 7 percent of the purported $787 billion that you said we absolutely need to spend. And we didn't absolutely need to spend it. The market has ways of working this thing through. The problem we have and where that C minus or C grade is going to become an F a year from now is when we get into inflation, when we get into high interest rates and we get into all those bad things that come from infusing $2 trillion of spending that the government didn't have -- that has, in fact, borrowed from tomorrow to pay out today.

So we enjoy a little bit of a blip right now and that's because of dollars that are working their way through the system.

MALVEAUX: Let -- let's move on...

STEELE: But you're not creating jobs. 2.5 million jobs have been lost

MALVEAUX: Michael, if I can interrupt...

STEELE: And I think the numbers will show that's...

MALVEAUX: Let's go ahead and move on to health care...

STEELE: Go ahead.

MALVEAUX: ...the health care reform debate.

STEELE: Sure.

MALVEAUX: Obviously, this is something a lot of people are talking about. The new ad from the DNC that is pointing to members of your party saying that the debate that's taking place in this country has turned rather nasty in some of these Congressional town hall meetings.

And this is what the DNC is putting out.

Let's take a listen.

(BEGIN VIDEO CLIP FROM DNC AD)

UNIDENTIFIED MALE: Their goal -- destroy President Obama and stop the change Americans voted for overwhelmingly in November.

UNIDENTIFIED MALE: It will break him.

RUSH LIMBAUGH, CONSERVATIVE TALK SHOW HOST: I hope he fails.

UNIDENTIFIED MALE: This mob activity is straight from the playbook of high level Republican political operatives. They have no plan for moving our country forward, so they've called out the mob.

(END VIDEO CLIP)

MALVEAUX: How do you respond to this?

STEELE: Oh, those scary Republicans. Oh, my God. Let's see. We don't -- we have 40 seats in the Senate and we're down some 30 plus or more in the House. Gee, you know, stop using the boogeyman. The policies that this administration is pulling out is what's scaring America and it's not Republicans. In fact, what we've been saying is -- is trying to draw people and educate people to the fact that these plans are, in fact, what they are.

MALVEAUX: But what do you think of the...

STEELE: And I find it rather amusing...

MALVEAUX: ...that Robert MacGuffie, who is the head of the grassroots organization Right Principles, who talked to CNN earlier today?

And he -- he did have a strategy memo that he put out encouraging people. And he says don't carry on and make a scene, just shout intermittent shout-outs. That there has been some real emotion here on both sides and that this has been encouraged...

STEELE: Yes.

MALVEAUX: ...from, also, members of -- of your party.

Do you think this constructive?

STEELE: Well, I -- I don't -- I don't know Robert MacGuffie. I don't know that he is, in fact, a Republican. He does -- he doesn't work for me. He's not a member of the RNC. It's not part of any coordinated strategy that we have here.

You have citizens, Republican, Independent and otherwise, who are concerned here. And I find it the height of arrogance and hubrance -- hubris to sit there and think because people want to smart and coordinated in their (INAUDIBLE), because they want to speak out, because they have something to say here, that there's -- they're being demonized and demagogued as being extremists.

You know, when we get to a point in this country where dissent is extremism, we've turned, I think, a very dark page in our history. And I don't want us to go there. I encourage Americans and I'm -- right now, to go to these town hall meetings, to -- to talk to your Congressmen, the people that you elected...

MALVEAUX: Mr. Chairman... STEELE: ...empowered to come to Washington.

MALVEAUX: Overall grade for the Obama administration in the first 200 days?

STEELE: You know -- you know, I could do the partisan oh, give the boy enough and move on, but I'm not saying that. I think this -- this has been a D plus, C minus effort, because we don't know all the stories. We're not being told everything. The direction we're headed in is not in the best interests of the country right now. And I -- I'm going to wait and see where we go in the next 100 days. So I guess I'll see you in another hundred days if this becomes a routine for us, to chart these 100 days...

MALVEAUX: Well...

STEELE: I just want the administration to stop campaigning and start governing.

MALVEAUX: We'll invite you back for the -- for the 300. Don't worry, Michael, we'll -- we'll invite you back for the 300.

STEELE: All right.

MALVEAUX: Michael Steele, chairman of the RNC, thank you very much for joining us here in THE SITUATION ROOM.

STEELE: Take care.