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THE MCLAUGHLIN GROUP HOST: JOHN MCLAUGHLIN PANEL: PATRICK BUCHANAN, MSNBC; ELEANOR CLIFT, NEWSWEEK; MONICA CROWLEY, WASHINGTON TIMES; MORTIMER ZUCKERMAN, U.S. NEWS & WORLD REPORT BROADCAST: WEEKEND OF JANUARY 1-2, 2011

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ANNOUNCER: It's the 29th annual McLaughlin Group year-end awards, 2010, part two. Here's the master of ceremonies, John McLaughlin.

MR. MCLAUGHLIN: Destined for political stardom, 2011. Pat.

MR. BUCHANAN: Ken Cuccinelli, the AG, the attorney general of Virginia. He's going to be in a year-long battle. He's going to be standing behind the Constitution in a head-to-head battle with Obama over Obamacare. It may go right to the Supreme Court, and Obamacare could go down. And Cuccinelli will be a national hero if it happens.

MR. MCLAUGHLIN: Cuccinelli says it's non-constitutional. MR. BUCHANAN: Non-constitutional, the individual mandate.

MS. CLIFT: There are a lot of ifs on the way to stardom there. (Laughs.)

MR. BUCHANAN: Right.

MS. CLIFT: My choice is Steny Hoyer. He's number two in the Democratic leadership. He's been in Congress 30 years. He's always been overshadowed. But he's in a position to deal with John Boehner and the Republicans. And I think if anything happens in Congress next year that's positive, Steny Hoyer will be in the middle of it.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: I've got four newly elected Republicans: Marco Rubio, senator from Florida; Allen West, congressman from Florida; Susana Martinez, the newly elected governor of New Mexico; and Nikki Haley, the newly elected governor of South Carolina.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Jeb Bush, because of his national leadership in the field of education, which is going to become a dominant issue next year.

MR. MCLAUGHLIN: The envelope, please, Monica. Let's see what we've got here. What do you say, Mort? Are you paying attention?

MR. ZUCKERMAN: (Laughs.) Yes.

MR. MCLAUGHLIN: Destined for political stardom in 2011 -- Mort will like this -- New York City Mayor Mike Bloomberg. The more approval ratings for both Republicans and Democrats drop, the more people will ask Bloomberg to throw his hat in the ring to run for president in 2012 as an independent. Destined for political stardom in 2011.

What do you think of that?

MR. ZUCKERMAN: I'd say that's a low-probability outcome, not because he isn't a star, but because I think he's going to stay away from running or even indicating that he'll be involved in presidential politics.

MR. MCLAUGHLIN: Okay, destined for political oblivion, Pat.

MR. BUCHANAN: European Monetary Union, John, the Eurozone. It is coming down this year. Ireland or Greece or Spain or Portugal will default. The banks will come down. The Eurozone will be yesterday.

MR. MCLAUGHLIN: Eleanor. MS. CLIFT: "Don't ask, don't tell." The Congress is acting. If they didn't or if they don't, the courts will act. And we're going to end that policy, which has been really unfair and is a violation of the civil rights of a large number of people.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: Cap and trade and any other legislation that's linked to this now discredited notion of man-made global warming.

MR. ZUCKERMAN: The two national fiscal commissions after the Congress and the president went through with a trillion-dollar deficit program, that so-called tax bill that's just going to add a trillion dollars to the deficit. They're politically irrelevant.

MR. MCLAUGHLIN: Destined for political oblivion: Florida independent Governor Charlie Crist. He was once a finalist for the GOP vice-presidential candidacy. Today he is a talented politician with no home. Once a dedicated public servant, today he's toast, destined for political oblivion, Pat.

Okay, best political theater. Pat.

MR. BUCHANAN: Sarah Palin beats a halibut to death in a boat -- (laughter) -- blows away a friendly caribou who's approaching her, and raises the ratings of The Living (sic/means Learning) Channel by 5 million people.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I give it to President Obama, President Clinton, their appearance together in the White House briefing room. It was like two commanders of armies coming together. It was both mythical and, if you were a Democrat, magical.

MS. CROWLEY: Best political theater.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: I'm going to give it to Glenn Beck's Restoring Honor rally. It was astonishing that he was able to mobilize hundreds of thousands of people to come on the Mall this summer, and he's mobilized millions of people for the conservative cause.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Jon Stewart and Stephen Colbert gathering a quarter of a million people in Washington to celebrate the end of anger in politics.

MR. MCLAUGHLIN: Oh, we'll look forward to that. Best political theater: Christine O'Donnell's television ad during the Delaware Senate race where she declared, quote, "I'm not a witch," unquote. We haven't heard accusations of witchcraft as an issue in a U.S. Senate race ever before this. Best political theater.

Okay, worst political theater.

Pat.

MR. BUCHANAN: I've got one that'll surprise you. "I'm not a witch," John. "I'm you." (Laughter.) I had the same one for worst political theater, much as I admire Christine O'Donnell and wanted to see her in the United States Senate. (Laughs.)

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Worst theater: Sarah Palin killing Bambi and bludgeoning the halibut.

MR. BUCHANAN: (Laughs.) It was a caribou.

MS. CLIFT: And at the risk of mixing my metaphors or mixing my fish, she jumped the shark on that. Her polls are dismal. Eighty percent of women do not like Sarah Palin and cannot imagine her as president.

MR. MCLAUGHLIN: What about ratings on The Learning Channel on Sunday night?

MS. CROWLEY: Through the roof.

MS. CLIFT: I don't think that's doing all that well either.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: Her show is doing quite nicely. I'm not worried about Sarah Palin.

MR. MCLAUGHLIN: Well, it will now, right?

MS. CROWLEY: Worst political theater: Nancy Pelosi with that absurdly cartoonish giant gavel that she schlepped to the House of Representatives on the day of the final Obamacare vote.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Well, I would say it was the terrible acting of so many political leaders when the WikiLeaks exposed a lot of their private communications, trying to give the suggestion that these weren't significant. MR. MCLAUGHLIN: Worst political theater: The confirmation hearings for the U.S. Supreme Court Justice Elena Kagan featuring a stacked Democratic majority, a candidate who never served on the bench, and practically no paper trail to question her on her command of the law. Worst political theater.

Pat, worst political scandal.

MR. BUCHANAN: Worst political scandal: Client number nine in a high-end prostitution ring turns out to be the governor of Mort's state of New York, Eliot Spitzer; cost him a career which was surging and soaring.

MR. MCLAUGHLIN: Now hosting --

MR. BUCHANAN: CNN.

MR. MCLAUGHLIN: -- Spitzer Parker.

MR. BUCHANAN: Parker Spitzer. (Laughs.)

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: BP oil spill, which is being litigated now in the courts, civil suits and potentially criminal suits. And I want to point out that that gavel, I believe, was used to gavel when Medicare was passed. So there was some fine history there that was appropriate for Nancy Pelosi to --

MS. CROWLEY: Worst political scandal: Leaving the tax rates and the resolution of the tax rates to the last minute. That was economic malpractice.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: The worst political scandal: The failure to hold public officials accountable who said it would only cost $25 billion for the Congress and the country to take over Fannie Mae and Freddie Mac. We're up somewhere north of $150 billion, and it's going to go up to $300 billion.

MR. MCLAUGHLIN: The worst political scandal was President Obama's attempt to persuade Democratic Congressman Joe Sestak to drop out of the Pennsylvania race, Democratic primary, so that U.S. Senator Arlen Specter would win. Worst political scandal.

Okay, most underreported story of 2010. Pat.

MR. BUCHANAN: The illegal aliens are going home, John, and they're being deported in considerable numbers. Their numbers are being reduced, and nobody's mentioning that fact. The attrition policy is working. If the Obama administration would pursue it stronger, they'd have a great record. MR. MCLAUGHLIN: Excellent.

Eleanor.

MS. CLIFT: Most underreported: President Obama's accomplishments. I'll just mention one that a lot of people don't know about, and that's the student-loan reform, which got the banks out as the middleman. It's a much better deal for students. Republicans are going to try to repeal that so they can get their buddies, the banks, back in the game.

MR. MCLAUGHLIN: Mmm-hmm. (Acknowledging.)

Monica.

MS. CROWLEY: The Ahmed Ghailani verdict. He was an al Qaeda terrorist who was acquitted of all but one charge when he was tried in civilian court. This was a disaster for the Obama-Holder policy of trying these guys in civilian court. And this could mean the death knell for that process.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: The most underreported story is the vulnerability of the nation's computer networks, especially in the electrical power grid and the financial system, to hackers, which could -- if we ever get into a serious situation, could bring this country to a halt.

MR. MCLAUGHLIN: Interesting.

Most underreported story of 2010: The spike in the U.S. poverty rate. This year poverty climbed to a 15-year high. Forty-four million Americans today live at or below the poverty level. Most underreported story of 2010.

Okay, the most overreported story of 2010. Patrick.

MR. BUCHANAN: The suffering of Lindsay Lohan. (Laughs.)

MR. MCLAUGHLIN: Overreported.

MR. BUCHANAN: She was in court, yeah. I've seen it on cable TV constantly, John.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I didn't know you watch that stuff, Pat.

MR. BUCHANAN: (Laughs.)

MS. CLIFT: I give it to the TSA pat-downs. MR. MCLAUGHLIN: Interesting.

MS. CROWLEY: Bristol Palin on "Dancing with the Stars.

"

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Yeah, I would say it was the oil spill in the Gulf that just was a story that went on and on and on forever.

MR. MCLAUGHLIN: The most overreported story of 2010: The tea party movement, so overreported that the coverage created a caricature of tea partiers, portraying them as angry racists -- too old, too white, too male -- the most overreported story of 2010.

Okay, biggest government waste. Pat.

MR. BUCHANAN: The Iraq war -- 4,500 dead, 36,000 wounded, $1 trillion down the drain, 500,000 Iraqi widows and orphans. For what? A country that didn't threaten us, didn't attack us, and didn't want war with us.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I'll say amen to that, and I'll add tax cuts for the rich.

MR. MCLAUGHLIN: Monica.

MR. BUCHANAN: No, those are important. (Laughter.)

MS. CLIFT: You were supposed to say amen in return. (Laughs.)

MS. CROWLEY: Biggest government waste -- there's so much to choose from this year, like every year. But I'm going to give it to the $6.4 billion in stimulus money that went to phantom congressional districts.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: The pat-down of screeners at airports when biometric screening can do the same thing without uncovering private secrets. MR. MCLAUGHLIN: Right on, particularly the iris, the iris screening. It cannot be duplicated by any other person. Only one -- for your irises, Pat, one for each.

MR. BUCHANAN: Same with fingerprints.

MR. MCLAUGHLIN: No, the fingerprints is not true. The Japanese have been able to mimic fingerprints.

The biggest government waste: The death penalty. An individual death-penalty case could climb to $100 million, much of it spent at the litigation level. Also, DNA evidence has exonerated nearly 300 death-row inmates. At least 39 of those inmates have been executed despite evidence of innocence. Biggest government waste.

Best government dollar spent, Pat.

MR. BUCHANAN: I think the money spent for the Haitian victims of the earthquake and the Pakistani victims of those horrendous floods in that country.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: The GM bailout. GM is now doing quite well. They had a very successful IPO, and they've got a great share of the market in China, and also in all the other bailouts as well. The bankers have paid back their money with interest. Even AIG is beginning to return the money.

MR. MCLAUGHLIN: A basket of bailouts, right?

MS. CLIFT: Yes. (Laughs.)

MS. CROWLEY: Best government dollar spent: The salaries of General David Petraeus and Ray Odierno, Afghanistan and Iraq.

MR. MCLAUGHLIN: What are they?

MS. CROWLEY: I don't know what they are, but whatever it is --

MR. MCLAUGHLIN: Over $300,000?

MS. CROWLEY: -- it's the best government money spent.

MR. MCLAUGHLIN: Three hundred fifty thousand?

MR. BUCHANAN: It's $175,000.

MR. MCLAUGHLIN: That's all?

Mort.

MR. ZUCKERMAN: The fake bombs that were used to catch would-be terrorists. MR. MCLAUGHLIN: Best government dollar spent: The Bush tax cuts. The extension of those cuts will add 1 percent to GDP growth, a far higher boost than all of President Obama's stimulus spending plus Cash for Clunkers and first-time home buyers' credit combined. Best government dollar spent is that.

Okay, boldest political tactic. Pat.

MR. BUCHANAN: Lisa Murkowski gets upset in the Alaska Senate primary. She's beaten. She puts herself on as a write-in, runs and wins back her Senate seat. There is more than one mama grizzly in Alaska, John.

MR. MCLAUGHLIN: Excellent choice. I think it's mine.

Eleanor.

MS. CLIFT: Boldest tactic: "I am not a witch. I am you." (Laughter.)

MS. CROWLEY: Boldest tactic: Governor Jan Brewer signing into law that Arizona illegal-immigration law.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: The computer geniuses whose Stuxnet malware brought the centrifuges of Iran to a screeching halt.

MR. MCLAUGHLIN: Boldest political tactic: President Obama's enlistment of former President Clinton to take his place at the podium and sell skeptical Democrats on the idea of extending all of the Bush tax cuts. Obama's calculation was that failure to get the compromise was worse than looking weak. Boldest political tactic.

Okay, here it is: Best idea of 2010. Pat.

MR. BUCHANAN: After his shellacking in 2010, Barack Obama embraces the Bush tax cuts, works with the Republicans, gets a deal and starts back up in the polls.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I'm going abroad -- the coalition government, the unity government in England, conservative Prime Minister David Cameron and the Liberal Democrat deputy, Nick Clegg. And together they're able to take the heat as they're steering the government through a lot of austerity measures that have prompted protests in the streets.

MR. MCLAUGHLIN: Great idea.

Monica. MS. CROWLEY: The Obama administration's decision to keep Guantanamo Bay open and to keep top al Qaeda terrorists like Khalid Sheikh Mohammed in indefinite detention, proving yet again that President Bush was right.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Whoever came up with the idea for the movie about Facebook called "The Social Network.

"

MR. MCLAUGHLIN: Best idea of 2010: Stuxnet, the computer worm which derailed Iran's uranium enrichment program. As Mort has noted, Stuxnet has shut down thousands of nuclear centrifuges that produce the nuclear uranium that can be processed to make the bomb. Stuxnet is 21st century cyber warfare at its best. Best idea of 2010.

Okay, worst idea of 2010. Patrick.

MR. BUCHANAN: The Fed's quantitative easing, buying up all those bonds and inducing inflation in the future American economy.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Supreme Court decision in Citizens United, which took the cap off of contributions, many of them anonymous, from corporations and unions, flooding the political process.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: Building a mosque at Ground Zero, which would be a huge victory for the insidious stealth jihad happening now in America.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: The trillion dollars in tax cuts without putting anything in for subsequent reductions in government expenditures to balance off the revenue losses.

MR. MCLAUGHLIN: Worst idea of 2010: President Obama's rejecting of Vice President Joe Biden's advice to limit the U.S. military role in Afghanistan to surgical operations, all technology, notably drones. In rejecting Biden, Obama has de facto committed -- is now de facto committed to keeping military forces in Afghanistan until late 2014. Worst idea of 2010.

Okay. Sorry to see you go, Pat.

MR. BUCHANAN: Al Haig, our friend and boss in the White House days, in the final days, and Joe Sobran, the best conservative writer of his generation. MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: The Gore marriage. They announced in June, after 40 years, that they're separating.

MR. MCLAUGHLIN: Monica.

MS. CLIFT: Sorry to see that go.

MS. CROWLEY: General Stanley McChrystal, who is still very much with us, but we did lose the nation's top counterinsurgency guy because of some very impolitic comments he made to Rolling Stone.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Ted Sorensen, who was a great speechwriter for John Kennedy and the architect of phrases like "Ask not what your country can do for you; ask what you can do for your country." He was a marvelous man.

MR. MCLAUGHLIN: Sorry to see you go, White House economic guru Larry Summers. The former Treasury secretary and Harvard University president was the only Obama advisor who acknowledged how global trade means lost American jobs gone overseas. Sorry to see you go, Larry.

Okay, 15 minutes of fame. Pat.

MR. BUCHANAN: PFC Bradley Manning. Welcome to Leavenworth, Bradley.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Shirley Sherrod, the USDA official who was fired for having -- when her remarks were taken out of context by a conservative activist. I am flattered by her. You meant a negative 15 minutes. Mine is a positive 15 minutes for her, not for the scandal that followed.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: Velma Hart. She was the woman who respectfully but emotionally challenged President Obama over his economic policies. And she famously told him that she was exhausted from defending him. She has since lost her job.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Christine O'Donnell, who won the Republican primary for the Senate in Delaware and took away a sure Republican seat in that state. MR. MCLAUGHLIN: Fifteen minutes of fame: Joe Miller, the Republican Senate candidate from Alaska. Miller got his 15 minutes after being endorsed by Sarah Palin and the tea party. But Miller lost the election to a write-in candidate and incumbent; namely, Lisa Murkowski. Miller has been hung out to dry since then. Fifteen minutes of fame.

Okay, best spin of the year, Pat.

MR. BUCHANAN: Larry King -- "I want to spend more time watching my kids play little league ball," when he didn't want to go. (Laughs.)

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: He'll be missed. He had --

MR. BUCHANAN: Yeah.

MS. CLIFT: -- his own style of interviewing. He was very successful.

Best spin: Billions of dollars of corporate money is not a problem in the political process because we spend more on dog food. I heard that from you.

MS. CROWLEY: Best spin of the year -- that health-care reform was about health care. It was never about health care. It was about government control.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Well, the best spin was that Obamacare would, in fact, save money.

MR. MCLAUGHLIN: The best spin of the year: President Obama's own post-midterm spin. Voters sent him a message, he says. The message, according to Obama, was compromise with the Republicans. But exit polling shows that the voters' message was not compromise. It was block Obama's agenda. Best spin of the year.

Okay, the most honest person of the year.

MR. BUCHANAN: My favorite socialist, Bernie Sanders -- (inaudible) -- to admit that it spent $3 trillion bailing out everybody in the western world.

MR. MCLAUGHLIN: Right. Eleanor.

MS. CLIFT: Richard Holbrooke, who, with his dying breath, said we should end the war in Afghanistan.

MR. MCLAUGHLIN: Monica. MS. CROWLEY: I'm going to give it to Fidel Castro, who finally admitted this year that socialism doesn't work, and he is moving to privatize all of the state industries.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Stanley McChrystal, our former general in charge of counterinsurgency in Afghanistan, in his press conference.

MR. MCLAUGHLIN: Most honest person of the year. Did you finish?

MR. ZUCKERMAN: Yeah.

MR. MCLAUGHLIN: First Lady Michelle Robinson Obama. When asked by Carla Bruni Sarkozy, the first lady of France, how Michelle liked living in the White House, Ms. Obama responded, "It's hell." The most honest person of the year.

Okay, the most overrated. Pat.

MR. BUCHANAN: Mahmoud Ahmadinejad of Iran. Neither he nor his country is a mortal threat to the United States. And, no, he is not Adolf Hitler.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Overrated: The surge of Democratic voters in '08. They didn't show up for the midterms.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: Most overrated: Hillary Clinton as secretary of State. In every major foreign-policy issue, she's either been a failure or AWOL -- Russia, China, Iran, North Korea, the Middle East peace process, and Afghanistan.

MR. MCLAUGHLIN: You don't agree with that, Mort.

MR. ZUCKERMAN: No, I don't.

The 2 million students in Paris who rioted in the streets against raising the social-security age when the social-security system will be broke by the time they get to the age that they're worried about.

MR. MCLAUGHLIN: The most overrated: The Democratic Party boasts that it has the edge in social media to build political strength; namely, using networking websites like Facebook or Twitter or MySpace or Foursquare, et cetera. The tea party and the GOP have clearly caught up and surpassed the Democrats in 2010. So, therefore, their claim, the Democrats' claim, is wildly overrated. Okay, the most underrated. Pat.

MR. BUCHANAN: The antiwar conservative movement, which is battling the neocons to prevent a new war with Iran, centered around the American Conservative magazine.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Underrated -- I'm tempted to give it to Hillary Clinton just to counter Monica's tirade, but I actually am giving it to HUD Secretary Shaun Donovan, who's working very effectively and quietly behind the scenes to stabilize the housing crisis.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: Well, I'm tempted to counter Eleanor's tirade there, but I will give the most underrated to Sarah Palin, who continues to be dismissed and mocked by the left, and yet she has far more political and cultural influence than her critics give her credit for.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: President Hu Jintao of China, who led that country through an economic downturn by a massive and brilliant infrastructure investment that turned the country around in less time than any other major country.

MR. MCLAUGHLIN: Number two in the world in GDP?

MR. BUCHANAN: Yeah.

MR. MCLAUGHLIN: Most underrated: Rahm Emanuel. Obama should have listened more to his former chief of staff. For example, Emanuel called for an incremental health-insurance bill, not a three-foot-high comprehensive one. He was ignored, but he was right. Rahm Emanuel, the most underrated category of the year.

Okay, macro predictions. Pat.

MR. BUCHANAN: I think there's going to be -- and Mort and I have been talking -- a general collapse of -- I mean, governments are going to default, and I think banks are going to collapse across Europe and maybe in the United States. Maybe states like California and Illinois are going under. I don't know how, John, we avoid a general financial collapse as great as it was in 2008.

MR. MCLAUGHLIN: You mean the world?

MR. BUCHANAN: I think the world. I think Europe and the United States primarily. MR. MCLAUGHLIN: You're talking cataclysm?

MR. BUCHANAN: I am talking financial -- as George Bush famously said, "This sucker is going down."

MR. MCLAUGHLIN: Oh, give me a break.

Eleanor.

MS. CLIFT: That's a little apocalyptic, I think, for the end of the year. But I'll play off of Pat's saying that he's going to work on his Nixon memoir in advance of the centennial of Nixon's birth. Well, next year is the centennial of Ronald Reagan's birth, February 6th, and they will begin with a fly-over and 21-gun salute at the library. Then they'll have a year worth of events, culminating in the first primary of the Republican candidates.

And I think the Reagan spirit will hover over the election process, but I hope they take the right message from this, because Reagan worked with Democrats. He was a former Democrat. And he had a signature optimism. And I think divisiveness is much more the order of the day, and particularly with Sarah Palin, who has kind of derided President Reagan, saying, "Oh, he was really just an actor," as a way to sort of inflate her own credentials.

MR. MCLAUGHLIN: What is that all about?

MS. CLIFT: It was her way of saying that she has as good a credentials as he had.

MR. MCLAUGHLIN: Monica.

MS. CROWLEY: I do agree with Pat that I think --

MR. MCLAUGHLIN: Do you believe in an apocalypse now, the way Pat does?

MS. CROWLEY: Well, you know what? I do agree with Pat to some extent. I think that the growing sovereign-debt crises that we're seeing around the world, that they will lead to some great new economic reset.

I don't know what form it's going to take.

But I will say that the macro prediction -- in the United States, we have had very long-term and continuing and stubborn high unemployment, and I think it's going to lead to some major psychological realignment on the part of the American people, because we haven't -- apart from the Great Depression, we really haven't gone through anything quite like this that has shattered our very assumptions about America -- that our children will have it better than we did, that everything we knew to be true is no more.

MR. MCLAUGHLIN: Do you think Buchanan is going to experience that psychological realignment?

MS. CROWLEY: Are you already, Pat?

MR. BUCHANAN: I'm worried about the financial realignment right now, John.

MR. MCLAUGHLIN: (Laughs.)

MS. CLIFT: He's in gold.

MR. MCLAUGHLIN: Mort, Mort, Mort.

MR. ZUCKERMAN: The state and local governments are facing deficits in excess of $200 billion this year. They have no choice -- they, by law, have to balance these budgets. I think a number of them are going to find that extraordinarily difficult. California is facing a $28 billion deficit this year and $20 billion in deficits five years out. We have to find a way to address that issue. And Washington is going to get completely embroiled in that, because we cannot allow state and local governments to collapse.

MR. BUCHANAN: Right, but I don't think the Republicans are going to bail them out this time. See, I think some of the states almost have to go under. They can't keep making sacrifices and imposing them on basically the social safety net.

MR. ZUCKERMAN: But it is going to have -- it's really what Monica is saying. Just as the inflation of the 1970s really affected people's attitudes, so too this -- literally this large level, high level of unemployment is going to go on for -- it's going to affect people's attitudes towards consumption for years to come.

MR. MCLAUGHLIN: Have more faith in Geithner, Bernanke.

MR. ZUCKERMAN: I do have faith.

MR. MCLAUGHLIN: Have more faith.

MR. ZUCKERMAN: I do. I do.

MR. MCLAUGHLIN: Things are going to turn around. (Inaudible.)

My macro prediction is that the U.S. organized-labor movement will rise again with renewed energy in their new role of collective bargaining and a new role as a bridge between conservatives, who want businesses taxed less to spur hiring, and liberals, who want wages and benefits increased. Labor will carry that portfolio in 2011.

New Year's resolution, Pat.

MR. BUCHANAN: Publish my book that's just done and get to work on the Nixon memoirs to come out and to correct the record about Richard Nixon for his centennial date, which is 2013, 100th anniversary of his birth.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I resolve to do more to embrace the future, post more on my Facebook wall, tag my friends, and tweet. (Laughs.)

MR. MCLAUGHLIN: Excellent.

Monica.

MS. CROWLEY: Well, last year I resolved to do a World War II tour of Europe, and I'm sad to say I didn't do it this year. So I'm going to say it until I do it.

MR. MCLAUGHLIN: You're going to repeat the --

MS. CROWLEY: Same resolution --

MR. MCLAUGHLIN: You're going to repeat the resolution?

MS. CROWLEY: -- until I do it.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: I'm going to have my children start to learn Chinese. MR. MCLAUGHLIN: My new year's resolution: Next August, in Nevada, in the Black Rock Desert, I will attend the Burning Man festival. The festival is an American original. Bohemians and artists from all over gather and salute America's artistic freedom and self-government. If any of you are there, say hello to me.

MR. ZUCKERMAN: If I recognize you.

MR. MCLAUGHLIN: I will have a lengthy white beard.

Happy New Year. Bye-bye.

END.