SNBC host Keith Olbermann says the realistic threat of terrorism is being so overstated by the Bush administration — and in turn, by Fox News — that it’s downright funny.

“What happens when the culture of fear begins to inspire not terror or outrage, but laughter?” asked Olbermann. “Am I being too optimistic, or has giggling now passed paranoia in response to the president and these macabre parrots working at Fox?”

Olbermann cited a report yesterday carried by Fox News which suggested that Al Qaeda may be the true culprit behind the rash of recent California wildfires. Basing their coverage on an article it said ran “five days ago” in the Arizona Republic, the Fox and Friends morning program discussed an FBI memo stating that an Al Qaeda detainee had brought up the possibility of such a plan.

Calling the the report “almost all wrong,” the host took the network to task for grossly misreporting the age of the memo:

“The memo was reported not…five days ago, but six days ago — plus 1,560 more days ago,” said Olbermann. “The memo is from July 11, 2003. The Arizona Republic is a newspaper. Congratulations, Fox. But it has not been carrying the story…the guy who reported it doesn’t even work there anymore.”

Later in the program, Olbermann made up his own terror rumor about Al Qaeda’s far-reaching powers:

“I heard Al Qaeda causes night to fall,” he warned.

Air America radio host Rachel Maddow, a guest during the segment, said reports like Fox’s helped to aid a White House that profited from fear.

“They have to come up with superhuman powers for Al Qaeda because they want to use Al Qaeda to justify a super-extreme agenda for the United States of America,” said Maddow of the Bush administration.

Citing controversial intelligence techniques and possible military action against Iran she described as a “radical agenda,” Maddow said the administration required a “really radical justification for it…they’ve had to elevate this band of death-cult fundamentalist criminals into a threat that is greater to our country than the Soviet Union ever was.”

“And because it’s about such serious stuff,” she concluded, “I feel a little guilty thinking that it’s funny.”

The following video is from MSNBC’s Countdown with Keith Olbermann, broadcast on October 24, 2007