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THE MCLAUGHLIN GROUP

HOST: JOHN MCLAUGHLIN

JOINED BY: TONY BLANKLEY, PATRICK BUCHANAN,
ELEANOR CLIFT AND MORTIMER ZUCKERMAN

TAPED: FRIDAY, JANUARY 30, 2004
BROADCAST: WEEKEND OF JANUARY 31-FEBRUARY 1, 2004

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THIS IS A RUSH TRANSCRIPT.
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MR. MCLAUGHLIN: Issue one: Southern hospitality.

SENATOR JOHN KERRY (D-MA): (From videotape.) I've always said I think I can win in the South.

MR. MCLAUGHLIN: John Kerry is two for two, with big wins in Iowa and New Hampshire. Now heading into this Tuesday's seven primaries and caucuses, he's focusing on the Southern states of Missouri and South Carolina.

Question: Up to half of the voters in South Carolina's primary will be African-American. Congressman Jim Clyburn, South Carolina's most respected and influential black politician, endorsed Kerry. How valuable is this endorsement, Pat Buchanan?

MR. BUCHANAN: Extremely valuable, John. He's the most influential and popular black Democrat in the state, and he's very much respected. And Kerry's only one point behind Edwards. There's a real possibility that Kerry could pretty much run the board on Tuesday and put an end to this thing.

MR. MCLAUGHLIN: Is the African-American vote critical?

MR. BUCHANAN: Oh, sure. The African-American vote down there is probably between, when the vote comes out, I would say, 40 percent of the Democratic vote, John. And Kerry has tremendous support in the white community because he's got Hollings, Fritz Hollings, who is tough as he can be on the trade and jobs issue. So Kerry's looking awful good. Everything's breaking for him.

MR. MCLAUGHLIN: I think we all agree on that, don't we?

MR. BLANKLEY (?): We do.

MR. MCLAUGHLIN: Good. Let's move on. (Laughter.)

Okay. Dissing Dixie. "Everybody always makes the mistake of looking south. Al Gore proved he could have been president of the United States without winning one Southern state, including his own. I think the fight is all over this country. Forget about those red and blue states."

Question: Was this a tactical mistake on Kerry's part to have said that, because it looks like he's dissing Dixie, and Southern Democrats don't want to be written off by the their standard bearer? Is this going to hound Kerry in Dixie, Eleanor?

MS. CLIFT: Well, it's reality. I don't think the Democrats are going to carry the South. And they can win with a Midwest strategy, which is what Kerry is going to run.

But part of that statement was, "This is a fight all over the country. Forget about the red and blue states." And he's not going to concede the South, and I imagine when -- if he does get the nomination, he's going to look, perhaps, to somebody in the second spot who might have more appeal in the South.

MR. MCLAUGHLIN: Kerry's saying the Democrat could beat Bush without carrying the South. Isn't that insulting to the South?

MR. BLANKLEY: Yeah, look, it's politically not useful in the general election for Democrats to have their standard bearer seeming to write off the South.

Also, I would argue that at a strategic level, while yes, you can mathematically win as a Democrat north of the Mason-Dixon Line, it hasn't been done in modern times, if at all. And yes, Gore could have won if he'd won a couple other states, New Hampshire or whatever. But even a Democrat who's not strong in the South should try to get Tennessee or Kentucky, or maybe pick up Louisiana or North Carolina. And the idea of writing those states off and mathematically betting on sweeping everything north of the Mason-Dixon Line is not a formula I'd want to follow.

MS. CLIFT: Yeah, but you don't want to fall for the siren call of tailoring a ticket to appeal to the South.

MR. BLANKLEY: No, I agree with you. But you don't write them off, and you --

MS. CLIFT: And Kerry is looking at Missouri. That's the kind of state --

MR. BLANKLEY: Missouri's a great state, yeah.

MS. CLIFT: That's the kind of state, he needs, and he --

MR. BLANKLEY: But it's not in the South.

MS. CLIFT: It's close enough.

MR. BLANKLEY: Not quite.

MS. CLIFT: It's a border state.

MR. MCLAUGHLIN: Okay. (Laughter.)

Losing face. Blute and Scotto, two radio talk show hosts on Boston's WRKO 680, asked John Kerry if he could categorically deny reports that he used Botox. "Absolutely. I've never even heard of it."

Where did this come from? It came from Matt Drudge, John, who published alleged "before" and "after" pictures of you to substantiate the Botox claim. Three plastic surgeons looked at the photos, and when interviewed by the New York Observer, a newspaper, the two male surgeons said Kerry did use Botox. The female surgeon said he had not used Botox.

Question, Mort: Does the public have the right to know whether a candidate -- (laughter) --

MR. ZUCKERMAN: You're nice to go to my field of expertise here, John. I really appreciate it.

MR. MCLAUGHLIN: -- whether a candidate has used Botox?

MR. ZUCKERMAN: Yeah, well, let me just say that you -- it's the wrong name that you gave to this segment, because you said it's "losing face." It's actually "saving face" -- (laughing) -- is the way you have to do it. You know, sure, on some level the public is entitled to know almost everything. I think it's totally irrelevant. I can't imagine he would have said what he said --

MS. CLIFT: Right.

MR. MCLAUGHLIN: Is there --

MR. ZUCKERMAN: -- if he had, in fact, resorted to it. And I think it's silly. It trivializes everything.

MR. MCLAUGHLIN: Is there a precedent, however, for this instance of wondering what Kerry's cosmetology is?

MR. BUCHANAN: Yes, there is. John F. Kennedy, John. His face would puff up and it was because he was taking --

MR. ZUCKERMAN: Medication.

MR. BUCHANAN: -- cortisone, which he had for that pain and that has the exact effect, same kind of effect as that botox puffing out your face. This is beautifying, though.

MS. CLIFT: Yeah, but cortisone has health side-effects; botox to ease wrinkles is not going to affect his ability to be president.

MR. BUCHANAN: How do you know this, Eleanor? How do you know this? (Laughs.)

MS. CLIFT: I don't do botox! (Laughs.) But I will also point out, there is a precedent here: a lot of people wondered whether Ronald Reagan dyed his hair. Did we have a right to know that?

MR. BUCHANAN: Right.

MR. MCLAUGHLIN: That's right. And what about the alpha male, Al Gore, who Naomi Wolf encouraged to put on --

MR. BUCHANAN: Earth colors, earth tones -- (laughs).

MR. MCLAUGHLIN: -- earth tones in his attire.

MS. CLIFT: Yeah, but that's not a -- that's external. (Cross talk.) I want to quote Chris Wallace of Fox News, who says he has seen Kerry without his makeup and he can attest to the fact that he does not use botox. You know, makeup and lighting can do a lot.

MR. MCLAUGHLIN: Yeah, and also one distinguished cosmetic surgeon says you cannot tell in any way from photographs whether or not somebody uses botox.

MR. BUCHANAN: He looked terrific, though, John.

MR. MCLAUGHLIN: I want to ask you whether a short man could wear elevator shoes without revealing it to the public -- who's in politics. (Laughter.)

MR. BLANKLEY: You mean like Howard Dean, or someone?

MR. MCLAUGHLIN: Anyone. Yeah.

MR. BUCHANAN: Without revealing it?

MR. MCLAUGHLIN: Yeah, do you think the public --

MR. BLANKLEY: They'd be a heel to do such a thing. (Laughter.)

MR. BUCHANAN: Yeah, I think recall, you know, James Madison wore them. He was about 5-foot-2-inches high. But I think, John, if he did it, it would be a problem. He would be a figure of mockery. He's much better off standing up there the way Dean does next to Kerry -- looking very short, quite frankly.

MR. MCLAUGHLIN: Do you think we want to pick between somebody --

MS. CLIFT: Kerry's very tall, quite frankly.

MR. ZUCKERMAN: James Madison did not live in an era of television. I mean, certainly the way people look on television -- the nonverbal communication of television, it's critical for public office, let's face it.

MR. BUCHANAN: Right.

MR. MCLAUGHLIN: Don't you think that people love to see how this kind of question is answered because the people love to dig between the -- underneath the superficialities, and determine whether there's a character question there?

MR. ZUCKERMAN: Yeah, I think --

MR. MCLAUGHLIN: Maybe it's all quite legitimate.

MR. ZUCKERMAN: You never know. There are always questions that come up that somehow or other reveal a lot more about the person than you would have thought.

MR. BUCHANAN: Right.

MR. ZUCKERMAN: And those questions can be very important. It's hard for me to see that this is going into that category.

MR. MCLAUGHLIN: Okay.

MR. BUCHANAN: It is suggestive of -- if he's doing it, he has a problem, because he's a Massachusetts liberal; it suggests a Hollywood connection, and the artificial --

MS. CLIFT: (Gasps, laughs.)

MR. BUCHANAN: No, I'm serious. He's coming off as the tough soldier from Vietnam. If you're using botox, you got a problem.

MS. CLIFT: I think a lot of -- (word inaudible) -- Republicans use botox, too, Pat. (Laughs.)

MR. MCLAUGHLIN: If he had used botox and denied it, then he's got a real problem.

MS. CLIFT: Then he's got a problem.

MR. BUCHANAN: Very serious problem.

MR. MCLAUGHLIN: Okay, okay.

Slay the leader. In proper form, Howard Dean, the one-time front-runner, fixed in his cross hairs the current front-runner Kerry.

HOWARD DEAN (Democratic presidential candidate): (From videotape.) I want to take a run at Senator Kerry and give him another rebuttal opportunity here, because he gave what I consider to be a real Washington answer to the last question about mental health. He claimed credit for the Mental Health Parity Bill and for helping children get health care. Well, in South Carolina, there's 102,000 kids with no health care.

Do you have mental health parity? Because if you were in my state, you would. And I don't think that what Senator Kerry was talking about has been very much help for the people of South Carolina or anyplace else. With me, you'll get results because I'm a governor and I've done it. And with Washington, no matter what they say, it never seems to trickle down to the people in South Carolina.

MR. MCLAUGHLIN: Question: How does Dean stay in the game? I ask you, Tony.

MR. BLANKLEY: I don't think he does, frankly. I mean, having made mistakes before, we're all hesitant, I'm hesitant to predict again. He looks dead as a doornail.

MR. MCLAUGHLIN: What about the shakeup?

MR. BLANKLEY: Well, you shake up --

MR. MCLAUGHLIN: What did he do?

MR. BLANKLEY: He replaced Joe Trippi with Roy Neel. He replaced --

MR. MCLAUGHLIN: Well, no, Trippi actually resigned --

MR. BLANKLEY: He resigned after he was led.

MR. MCLAUGHLIN: -- because he didn't want to be marginalized.

MR. BLANKLEY: He was -- after he was led, yeah.

MR. MCLAUGHLIN: Well, he wasn't being -- he was supposed to be the senior strategic advisor. Wasn't that it?

MR. BLANKLEY: Right, right.

MR. MCLAUGHLIN: And he wanted to bring Roy Neel in for organization.

MR. BUCHANAN: And --

MR. ZUCKERMAN: And they brought in Neel on top of him, right.

MR. BLANKLEY: But the --

MR. MCLAUGHLIN: And also they have gone through, what, $40 million?

MR. ZUCKERMAN: Well, they only have 3 million (dollars) left, according to what they say, but they are clearly running out of money. And he --

MR. BLANKLEY: Yeah. Look, more then --

MR. ZUCKERMAN: Look, what he does -- (inaudible) --

MR. BLANKLEY: -- more than running out, I mean --

MS. CLIFT: Well, the --

MR. MCLAUGHLIN: All right. Let him -- let him finish, Eleanor.

MR. BLANKLEY: They're running out of money. More importantly, they're running out of strategy.

MR. MCLAUGHLIN: All right.

MR. BLANKLEY: I don't -- starting about three weeks out from Iowa, Dean lost all sense of what he was doing as a campaigner. He has not regained it, and I think he's just going to kind of peter out.

MR. MCLAUGHLIN: Well, he does have a strategy. He's actually going --

MS. CLIFT: Yes. The strategy is --

MR. MCLAUGHLIN: -- he's going into Michigan.

MR. BLANKLEY: Yeah.

MR. BUCHANAN: (Inaudible.)

MS. CLIFT: Yeah. The strategy is to take a pass on Tuesday's seven states and to hope for second and third, and --

MR. BLANKLEY: That's not a strategy; that's a delusion.

MR. BUCHANAN: (Laughs.)

MS. CLIFT: Excuse me, and go to Michigan, which has more delegates than all those other states combined and where they have Internet voting --

MR. BUCHANAN: No, it doesn't have that many.

MS. CLIFT: -- and where he has some organization. Dean does have organization in these states, and he may pull some second --

MR. BLANKLEY: He had organization --

MR. MCLAUGHLIN: Pat, has -- has --

(Cross talk.)

MS. CLIFT: -- and he may have some delegates. He may have some delegates to go to the convention with him.

MR. MCLAUGHLIN: Can I get into this?

MS. CLIFT: I just want to finish my thought, okay?

MR. MCLAUGHLIN: Okay, go ahead. I'm sorry.

MS. CLIFT: He just -- he wants to get to the convention with some delegates to say that he has a constituency that he wants honored, and that constituency --

MR. MCLAUGHLIN: Yeah, right, and then --

MS. CLIFT: -- is one that the Democrats ought to pay attention to or they're going to take their mouses and go home.

MR. MCLAUGHLIN: Then he can turn them over to Kerry and Kerry will make him, what, surgeon general or head of HHO (sic)?

MR. ZUCKERMAN: Ambassador to Panama.

MR. BUCHANAN: HHO? (Laughs.)

MR. MCLAUGHLIN: HHS. Pat, you have a lot of experience with the political death spiral.

MR. BUCHANAN: (Laughs.)

MR. MCLAUGHLIN: What does he have to do to stay in the race?

MR. BUCHANAN: Well, I had thought --

MR. MCLAUGHLIN: He's got to get a third in at least what, four or five of these contests on Tuesday?

MR. BUCHANAN: A little less than that. Look, I didn't win a single contest in '92, John. We stayed right to the convention and got a big speech at the convention. I think that there's something to what Eleanor says. I had thought this fellow says we represent something new and powerful and important and good in this party. It's non-Washington. It's anti-establishment. I want it represented and heard at this convention.

MS. CLIFT: Right.

MR. BUCHANAN: I want its voice heard and its ideas heard. But I saw him in that South Carolina -- in the South Carolina debate, he looked like a beaten man.

MR. MCLAUGHLIN: Okay, native son. John Edwards, narrowly edged out by Clark for third position, is campaigning hard in South Carolina, where he was born.

SEN. JOHN EDWARDS (D-NC): (From videotape) This president thinks his presidency is only about the war on terrorism, only about national security. Those things are critical for a commander-in- chief, but as we're going to talk about I'm sure going forward, there's a lot the president is not doing about jobs lost, about a health care crisis in this country. The president of the United States has to actually be able to walk and chew chewing gum at the same time.

MR. MCLAUGHLIN: Question: What happens to Edwards if he cannot carry South Carolina?

MS. CLIFT: Well, I have to take him at his word that he will be out of the race, and then he'll hope that the nominee might consider him in the number two spot. Although he has turned it down, he will eat those words happily. And he could be attorney general in the next Democratic administration. He's a terrific political talent. I'd hate to see him leave the scene.

MR. MCLAUGHLIN: Yeah, but he's got to --

MS. CLIFT: But he might win South Carolina, John, and --

MR. MCLAUGHLIN: Well, the Republicans --

MS. CLIFT: -- if he does, if anybody in this field can overtake Kerry, it's Edwards.

MR. MCLAUGHLIN: The Republicans love him too. He has got a Southern accent and he supports the president on the war.

Exit: Will next week's contest produce a clear winner? And will there be any surprising upsets?

Pat Buchanan?

MR. BUCHANAN: I don't think any big surprises. And it will produce Kerry as the almost certain nominee, unless some disaster occurs.

MR. MCLAUGHLIN: Eleanor?

MS. CLIFT: I think the other candidates could get a couple of wins. And there are still so few delegates that have been chosen, the race continues.

MR. MCLAUGHLIN: Tony?

MR. BLANKLEY: If Clark wins Oklahoma, if Edwards wins South Carolina, the parade continues. If neither of them do, then I think Kerry's got it wrapped up.

MR. MCLAUGHLIN: Well what are you saying?

MR. BLANKLEY: I'm saying I don't know.

MR. BUCHANAN: (Laughs.)

MR. MCLAUGHLIN: You don't know?

MR. BLANKLEY: Unless those two --

MR. MCLAUGHLIN: You don't know?

MR. BLANKLEY: I don't know.

MR. MCLAUGHLIN: You know the way this game is played. (Laughter.) What do you think?

MR. BLANKLEY: I think there's a 50-50 chance that one of them will win one of the states and keep the parade going.

MR. MCLAUGHLIN: (Laughs.)

MR. ZUCKERMAN: I think as a practical matter it's over. I think Kerry is going to have enough victories here that it's going to be absolutely clear that he's going to be the nominee, and all the rest of the dominoes will fall into place.

MR. MCLAUGHLIN: Kerry all the way.

MR. ZUCKERMAN: All the way.

MR. MCLAUGHLIN: You're right on the money, Mort, as usual.

When we come back, there's no "K" in WMD.

(Announcements.)

MR. MCLAUGHLIN: Issue two: Weapons of mass deception.

DAVID KAY (former head, Iraq Survey Group): (From videotape.) Clearly the intelligence that we went to war on was inaccurate, wrong.

MR. MCLAUGHLIN: "Wrong." That was the word of the week for David Kay, chief weapons inspector in Iraq until last week.

MR. KAY: (From videotape.) We were almost all wrong, and I certainly include myself here.

MR. MCLAUGHLIN: Dr. Kay stated flatly that Iraq did not have weapons of mass destruction. As for an alleged Iraqi nuclear program and large quantities of chemical and biological weapons that have been cited by President Bush, the vice president, the secretary of State, the secretary of Defense and the national security advisor over many months in many ways, as a justification for war, David Kay told this to The New York Times: "I'm personally convinced that there were not large stockpiles of newly produced weapons of mass destruction. We don't find the people, the documents or the physical plants that you would expect if the production was going on."

Kay said many astounding things over the last week in testimony and interviews. He said that debriefings of Iraqi scientists and officials revealed that Saddam Hussein was fantasy-ridden, paranoid, increasingly isolated, and out of touch with reality; that he insisted on approving major projects himself without delegating to others. This led scientists to approach the dom for funding for their own projects that were more fictional than factual, and then to use the research money for their own purposes. Corruption was widespread. The regime was no longer in control. It was like a death spiral. Saddam was self-directing projects that were not vetted by anyone else. The scientists were able to fake programs.

Question: How do these disclosures make Colin Powell and company look?

I ask you, Tony Blankley.

MR. BLANKLEY: Oh, I don't think they make Powell look bad, they make American intelligence look bad. I think we have a big job in rebuilding the credibility of our intelligence, both to the world and to our own leaders. And we need to start fundamental reform at the CIA. There's no question. This isn't the first time. They failed on September 11th. They failed all through the Cold War, over-predicting how strong the Soviets were. There is a long record of our intelligence service not being able to get the job done, and it's time for fundamental reform.

MR. MCLAUGHLIN: They didn't know that the Indians were going to explode the bomb, and they didn't know the Pakistanis were going to explode the bomb.

I have a question for you. Does what Kay said about the milieu of confusion under Saddam Hussein and the scientists pocketing money for their own funding of what he thought was nuclear research -- that created a lot of rumor. Do you think that was what the CIA was picking up, and that accounts for the failure?

MR. ZUCKERMAN: I think that contributed to the failure.

But I do think that what accounts for the failure more than anything else was the reports of the U.N. in 1998, who were there, really, to inspect the Iraqi arms situation, they were on the ground, every intelligence service in the world relied on them; they leave, and nobody thought that after they leave, that they would then disband the programs. So everybody assumed that they would continue. Clinton said it. I mean --

MR. BUCHANAN: If you've got a policy of preventive war and preemptive strike by the United States, you have got to have better intelligence than this. David Kay is an honest man. I interviewed him a dozen times. He said, "They got them in there, I'm going to go in and find them." When he didn't find them, he came back and told the truth.

MR. ZUCKERMAN: Yes.

MS. CLIFT: Also, you had --

MR. MCLAUGHLIN: Eleanor?

MR. ZUCKERMAN: He was another person who actually said very clearly that there were weapons.

MR. BUCHANAN: Yeah.

MS. CLIFT: You had a Saddam son-in-law who defected, who was debriefed by the CIA, who said that that regime had destroyed the weapons. And that information was carefully held.

Look. The political game that's going on here is the Republicans want to say it's all the CIA's fault. George Tenet has so many knives in his back, his back is perforated by now. There is also fault in the administration, because whatever intelligence there was, they --

MR. BUCHANAN: Tenet is going to be scapegoated. Rely on it.

MS. CLIFT: -- they hyped and misused.

MR. BLANKLEY: He's not a scapegoat.

MR. BUCHANAN: He is a scapegoat.

MR. MCLAUGHLIN: Hold on. Let Eleanor finish.

MS. CLIFT: They hyped and misused the intelligence that were there. They removed every caveat. And now they are resisting an outside investigation.

MR. MCLAUGHLIN: Okay. The human toll:

U.S. military dead in Iraq, 519.

Medical evacuees, over 12,000.

Civilian deaths in Iraq, 10,000 estimated, according to an NBC correspondent.

U.S. military dead in Afghanistan this week, seven; and for the entire war in Afghanistan, 107 dead.

Exit: On a U.S. damage scale of zero to 10 -- zero meaning zero damage, our international credibility remains unscathed; 10 meaning total, absolute and metaphysical damage, our credibility has been reduced to ashes -- how damaging is this deception to America's international credibility?

Pat Buchanan?

MR. BUCHANAN: It is an eight. And it's not higher only because all the other intelligence agencies around the world were as wrong as we were.

MR. MCLAUGHLIN: Not true. You will recall that Jacques Chirac said that there is no proof of weapons of mass destruction. And Putin said the same thing.

MR. BLANKLEY: No.

MR. ZUCKERMAN: Not Chirac.

MR. MCLAUGHLIN: You may be thinking of the Germans.

MR. BLANKLEY: Chirac said there was.

MR. ZUCKERMAN: Jacques Chirac said there were weapons of mass destruction. The French --

MR. MCLAUGHLIN: I will bring the quote with me next week, Mort.

MR. BUCHANAN: Okay.

MR. ZUCKERMAN: I'll bring you a quote in which he said there were weapons. (Laughter.) He said --

MR. MCLAUGHLIN: Are we going to have the war of the quote?

MR. ZUCKERMAN: Absolutely.

MR. MCLAUGHLIN: Eleanor?

MS. CLIFT: Yeah, those other countries didn't want to go to war over it. That's the big difference.

MR. MCLAUGHLIN: Eleanor?

MS. CLIFT: It's a 10. It's going to take the rest of this decade and perhaps a generation to repair what's happened.

MR. MCLAUGHLIN: Tony?

MR. BLANKLEY: It's a seven or eight. It's very substantial -- and Pat's right -- ameliorated somewhat by the fact that that was the judgment of other intelligence services as well.

MR. ZUCKERMAN: It certainly will affect us if there is another occasion where we try and lead a coalition into some kind of military effort based on our intelligence. We have a long way to go to reestablish that credibility.

MR. MCLAUGHLIN: The damage to our international credibility is incredible. It's tremendous. It's a 10. It will take a generation before the nations of the world believe us again in any similar situation.

Issue three: Deficits. So what?

Alarms are sounding over the astronomical budget deficits projected by the Congressional Budget Office, the CBO: $477 billion this year, and over the next 10 years, 2.4 trillion (dollars). That's nearly 1 trillion (dollars) more than projected only five months ago by the CBO, before new spending bills were passed, like the new Medicare prescription drug benefit and the $87 billion for Iraq.

And -- hold on to your drawers -- CBO's balance sheet doesn't even show the full range of liabilities the government faces.

(Begin videotape of "One on One" segment.)

DAVID WALKER (United States comptroller general): Well, right now we have about $6.8 trillion in total debt, but that doesn't count certain things as accrued and unfunded military and civilian pensions, promises to veterans with regard to disability and health care.

And most importantly, it doesn't count the discounted present value difference between what has been promised for Social Security and Medicare and what revenues are available. If you add up all those numbers, it's not 6.8 trillion (dollars); it's about $30 trillion, or $100,000 for every man, woman and child in the United States.

MR. MCLAUGHLIN: Do you think we're being denied the transparency that an informed electorate depends on?

MR. WALKER: I believe we clearly need more transparency, especially in light of the recent accountability failures in the private sector. The government should lead by example.

(End videotape.)

MR. MCLAUGHLIN: Leading by example is something budget hawks love.

REPRESENTATIVE MIKE PENCE (R-IN): (From videotape.) And I think it's incumbent on us, as conservatives in the Congress, to go to the captain, sextant in hand, and tell him, "Sir, this is not the course the American people sent Republicans to Washington to steer."

ROBERT RUBIN (former secretary of the Treasury): (From videotape.) I think our number-one problem today is that we now have created enormous long-term deficits. I think they are a very serious threat to our economy.

MR. MCLAUGHLIN: Question: Is the deficit Bush's Achilles' heel in this election? Yes or no, Pat Buchanan.

MR. BUCHANAN: No, it's jobs.

MR. MCLAUGHLIN: Jobs.

MR. ZUCKERMAN: Yes.

MR. MCLAUGHLIN: Eleanor?

MS. CLIFT: Well, it should be, if the Democrats can figure out a way to make it relate to people's lives.

The Medicare bill -- they concealed the figures at the White House. They refused to produce them for Congress, and they've got votes from conservative Republicans on the promise it would come in under $400 billion. Whoops! It's now what? Up to 560 (billion dollars)?

MR. MCLAUGHLIN: Quickly!

MR. BLANKLEY: No, it's not an Achilles' heel, but it is irritating conservatives, and that has to be managed as an issue by the White House.

MR. MCLAUGHLIN: Go ahead.

MR. ZUCKERMAN: When they passed -- when they advocated the last tax bill, the CEA and the Bush administration said it would create 510,000 jobs in the five months remaining in 2003 and another million jobs in 2004 on top of the normal growth. Those jobs were not created. I think it's a real source of vulnerability for Bush in all of this because the whole argument for it was it was going to help the economy. It hasn't helped the jobs part.

MR. MCLAUGHLIN: I can't improve on that, Mort.

We'll be right back with predictions.

(Announcements.)

MR. MCLAUGHLIN: Predictions. Pat?

MR. BUCHANAN: Schwarzenegger's bond issue goes down.

MR. MCLAUGHLIN: Eleanor?

MS. CLIFT: Louisiana Congressman Billy Tauzin is not going to go to the Motion Picture Association. He's going to make even bigger bucks by going to PhRMA. And he helped write the Medicare bill. So the revolving door swings once again.

MR. MCLAUGHLIN: Tony?

MR. BLANKLEY: The Patriots will not beat the spread in the Super Bowl.

MR. MCLAUGHLIN: Mort?

MR. ZUCKERMAN: Martha Stewart, Kobe Bryant and Michael Jackson will all be found innocent.

MR. MCLAUGHLIN: Fantastic. I predict that -- get this -- battery-powered automobiles will no longer be mass produced. The experiment is over. The batteries are dead.

Next week: Will the field be seven candidates or six or five?

Bye-bye.

PBS SEGMENT

MR. MCLAUGHLIN: Issue four: Right on the Hutton.

Remember the brouhaha between Tony Blair and the BBC? Last May a BBC reporter, Andrew Gilligan, had charged the Blair government with, quote, "sexing up" intelligence reports about Iraq WMD to strengthen the case for war. Gilligan's source for the report was a British scientist named David Kelly, who killed himself when his name became public as the source. That sparked the clamor that led to an investigation headed by British Judge Lord Hutton. He delivered his findings on Wednesday.

BRITISH JUDGE LORD BRIAN HUTTON: (From videotape.) In the context of the broadcast in which the sexing-up allegation was reported, was an allegation which was unfounded.

Hutton's findings gave the prime minister the firepower to repel his critics.

PRIME MINISTER TONY BLAIR: (From videotape.) The allegation that I or anyone else lied to this House or deliberately misled the country by falsifying intelligence on weapons of mass destruction is itself the real lie.

MR. MCLAUGHLIN: Blair is in the clear for now. The BBC, however, is not. Since the release of the Hutton report, both the director general and the chairman of the BBC have resigned. Others may fall as well.

Gilligan, by the way, resigned on Friday, and Kelly was innocent of all of the sexing-up allegation put forward by Gilligan.

Question: How big a victory is this for Tony Blair? Is he vindicated? Pat?

MR. BUCHANAN: It is a total triumph for Tony Blair. It is an astonishing surprise. I've talked to some British reporters. It is a tremendous blow to the BBC. It could not be better. It leads to Blair's third term.

MR. MCLAUGHLIN: Pat, it's a pyrrhic victory for Blair. It's a pyrrhic victory because the dossier, while it has not been sexed up, the dossier itself is fake. Don't you understand?

MR. BUCHANAN: John, look. You are talking about these little teeny points of reality.

MR. MCLAUGHLIN: Teeny points? Look a whole intelligence dossier was a fake.

MR. BUCHANAN: The whole world sees Blair as exonerated except you.

MR. MCLAUGHLIN: Exonerated from what?

MR. BUCHANAN: Exonerated from lying and sexing-up the report.

(Crosss talk.)

MR. MCLAUGHLIN: (Inaudible) -- okay, but the fact is that the dossier itself was false, erroneous, deceptive --

MR. BUCHANAN: His enemies were --

MS. CLIFT: And the British public opinion polls show that the Brits think that this report was a whitewash. And it was a whitewash.

MR. MCLAUGHLIN: Well, I have the polls here, and 90 percent don't think Blair is in the right.

MS. CLIFT: Right. They --

MR. MCLAUGHLIN: They don't think the BBC was in the right either. I don't see how that's a victory for Blair.

MR. ZUCKERMAN: It isn't.

MR. MCLAUGHLIN: And the bookmakers over there are saying that Blair could be out by January. What do you think about this?

MS. CLIFT: Well, I wouldn't say that.

MR. MCLAUGHLIN: You ought to be able to speak to this with some authority.

MR. BLANKLEY: Well, there was a moment, yes. (Laughter.) Yes, I think that Blair is going to run for reelection probably in May of 2005. He would have to have resigned if this report had come back the other way. His credibility, his reputation for voracity before the House of Commons has been maintained. But of course, he's still on the unpopular side of an unpopular war, and --

MR. MCLAUGHLIN: Quickly. Quickly. Let Mort in here.

MR. BLANKLEY: -- the BBC has not completely lost its followership.

MR. MCLAUGHLIN: You have 10 seconds, Mort.

MR. ZUCKERMAN: To the extent that you can have a triumph, it's a triumph for Tony Blair. It protects him as the leader of the Labor Party and as a leader in Parliament until whatever the next election date is, without question.

MR. BUCHANAN: Hear, hear, hear. (Laughs.)

MR. MCLAUGHLIN: He couldn't even get a raise in the university tuition rate. This -- he barely got it this week with the Parliament.

MR. ZUCKERMAN: He got it.

MR. MCLAUGHLIN: Which shows you how weak he is.

MR. ZUCKERMAN: He got it. That's a very different issue.

MR. MCLAUGHLIN: This is a pyrrhic victory. It's a pyrrhic victory for Blair.

MR. ZUCKERMAN: That may be the pyrrhic victory. This was not a pyrrhic victory. You --

MR. BUCHANAN: Hear, hear! (Laughs.)

MS. CLIFT: Well, it depends how the war goes and how many more --

(End of audio.)

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