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MR. MCLAUGHLIN: Issue one: Cornered Clinton.

REP. HENRY WAXMAN (D-CA): (From videotape.) The Rich pardon is a bad precedent. It appears to set a double standard for the wealthy and the powerful, and it is an end run around the judicial process.

Think about it for a minute. One week Marc Rich is on the Justice Department's list of the "10 Most Wanted," and then next week he's given a presidential pardon.

MR. MCLAUGHLIN: Bill Clinton is not going gentle into that good night. Forget Republicans; Democrats are beside themselves with annoyance and bile over the ex-president's wild exit from the White House, an exit still in progress.

Democrats see Clinton's shabby behavior as offscouring onto them and onto their party. How can they escape this ugly, unending Clinton overhang?

One, the pardon of fugitive financier Marc Rich for 51 counts of conspiracy, racketeering, and a $350 million tax evasion, in today's dollars.

Rich's ex-wife, Denise, is a top Democratic donor who gave $7,300 in personal gifts to the Clintons, $7,000 to Hillary's Senate campaign, and over $1 million to the Democratic Party, and a, quote, unquote, "enormous sum of money" to Clinton's library, as was remarkably acknowledged by Ms. Rich's attorney on Wednesday.

REP. DAN BURTON (R-IN, chairman, House Government Reform Committee): (From videotape.) Now was that all her money? Did any of it come from Marc Rich?

MR. MCLAUGHLIN: Denise Rich wrote to President Clinton, pleading clemency for her ex-husband, and now she's pleading again -- pleading the Fifth -- 14 times, in fact -- to Congress as it holds hearings on Clinton's Rich pardon. Denise refuses to answer questions now, but committee Chair Dan Burton wants Rich to be given immunity so she must testify next week.

Question: What was the most damaging revelation of the week, Michael Barone?

MR. BARONE: Well, John, it's sort of a tie. On the one hand, you have the revelation that Denise Rich gave an enormous amount of money, it's said, to the Clinton library, and so forth. And then there's the number of times -- very substantial, in the dozens; I've heard the figure 100 -- that Denise Rich visited the White House last year. I mean, this looks more and more like a pardon that was bought by Denise Rich and others, and the only question is what kind of currency was the most important.

MR. BLANKLEY: In the -- (off mike).


MS. CLIFT: Well, the hunt is on to try to find the evidence of the quid pro quo. And I suspect this is going to be like most of the Clinton scandals; the confluence of big money and politics is a thread that goes throughout political and governmental life. So, bad judgment and good lawyering are a deadly combination. But whether they're going to find any criminal activity here, I strongly doubt. And I think the Republicans are in sweet danger of veering off once more trying to drive the stake through the vampire's heart, and they'll overdo it and they'll take the stake themselves.

MR. MCLAUGHLIN: You notice that the opening sound on tape was Henry Waxman, who is a Democrat, and a liberal Democrat. And it was he who is condemning Clinton.

MS. CLIFT: He is condemning the behavior, as most Democrats are. But Henry Waxman is not endorsing yet another governmental investigation. The frustration is that Clinton has yet again given his enemies something to talk about. The Clintons are the gift that keeps on giving.

MR. MCLAUGHLIN: Do you think that the Democrats are as outraged, as bilious, as vexed as I declared in that opening? Aren't the Democrats really P.O'ed?

MR. BLANKLEY: Yeah, they are upset, although I should point out that the White House isn't delighted with this story continuing because it does sort of step on their tax cut and their own positive initiatives.

MR. MCLAUGHLIN: Before you go forward, is it fair to say, contrary to the White House, that the worse Clinton looks, the better Bush looks?

MR. BLANKLEY: Yeah, that's the silver lining in the story. But answering your original question, what's the most damaging information that came out, it was the telephone record of Clinton calling Beth -- the head of the --


MR. BLANKLEY: -- Dozoretz in Aspen, explaining how he was working to make the pardon work, he still had to work against his own White House counsels, who were opposing him. What this tells us, unlike what Waxman said, which was it showed poor judgment on the president's part -- former president's part -- it shows that Clinton was the spider in the middle of this web. He was orchestrating all of the events. He knew the money was coming into the library. He was telling the fund-raisers he's working on it. He has his lawyer, Quinn, doing the lawyerly work that he's doing. He's using Quinn's work, probably, to persuade the White House counsel. So he's --

MR. MCLAUGHLIN: What about the fact that he called Beth Dozoretz, who was at that time the financial director of the Democratic National Committee, to tell her, who was then with Denise Rich in Aspen, to tell her that he liked the arguments that he had seen and that he wanted this pardon given -- the arguments by Quinn -- and he wanted the pardon given and he was working on the lawyers. But what about the fact that he contacted -- was it -- Dozoretz?

MR. BLANKELY: Yeah, well that's the whole point. She was one of the money people in the Democratic Party. He wasn't contacting lawyers to get advice, he was contacting money people and informing that he was himself trying to get this pardon done. That's what's revealing, because the claim of the Democrats and the Clinton apologists has been that he was misinformed. Well, he wasn't misinformed, he knew exactly what was happening.

MR. MCLAUGHLIN: You know very well, Tony, and you know this, Lawrence, that Clinton stated categorically, "As far as I knew, Marc Rich and his wife were Republicans." Did you see that?

MR. BARONE: Will Clinton knows who gives him and the Democratic Party a million dollars. He knows the names of their grandchildren, he knows what street they live on, what floor of the apartment building, and so forth and so on. The idea that he didn't know a million-dollar contributor to the Democratic Party is totally ridiculous.

MR. MCLAUGHLIN: Am I overstating or overreading the negative reaction of the Democrats to what's happening in this Bill Clinton latest fiasco?

MR. O'DONNELL: No, you're not, because the message that it's preventing is actually the Democratic message against the Bush tax cuts. That is what's been silenced by all of this attention on the Clinton activities. Bush's message is still getting through there reasonably well on why he wants his tax cuts.

But the worst development of the week in this story was Denise Rich taking the Fifth Amendment. The only reason to take the Fifth Amendment is that you believe -- you must believe, in order to take it, that you might say something that subjects you to criminal -- criminal investigation --

MR. MCLAUGHLIN: Yeah, what are we talking about?

MR. O'DONNELL: -- and criminal conviction.

MR. MCLAUGHLIN: What are we talking about?

MR. O'DONNELL: What we are talking about here --

MR. BARONE: Bribery.

MR. O'DONNELL: -- is the question of the source of the million dollars. If that was Mark Rich's million dollars being funnelled through his ex-wife, then that money is entirely illegal in the Clinton campaign.

MS. CLIFT: Yeah. Of course --

MR. MCLAUGHLIN: Let him finish.

MR. O'DONNELL: Because it is money from a foreign country; someone who is not a citizen of the United States, just like --

MR. BARONE: Of course, they've never minded that.

MR. O'DONNELL: -- just like the possible Chinese money.


MR. O'DONNELL: That's a federal crime.

MR. MCLAUGHLIN: Okay, the problem with that, though --

MS. CLIFT: Get out all -- this is --

MR. MCLAUGHLIN: No, let me just clarify this one point factually, Eleanor, that the Wall Street Journal, as I recall reading it a few days ago or maybe a week ago, states that there's no evidence that this U.S. government has that Rich has renounced or does not have U.S. citizenship.

MR. O'DONNELL: Well, Denise Rich knows more about Mark Rich and this pardon than anyone else in this story. She has chosen to take the Fifth Amendment.

MS. CLIFT: Yeah, she's the ex-wife, and people are allowed to take the Fifth Amendment without --

MR. O'DONNELL: You're not allowed to take it if you do not believe --

MS. CLIFT: Excuse me, without -- without -- without --

MR. O'DONNELL: -- you are subject to criminal prosecution. You cannot take the Fifth Amendment if don't believe you have a criminal liability.

MS. CLIFT: Is this the whole prosecutorial team here --


MS. CLIFT: -- getting in shape? They're talking about giving her immunity; fine, let's hear what she has to say. But then we hear Senator Specter talking about a constitutional amendment --

MR. BLANKELY: No, that's silly. That's not going to happen.

MS. CLIFT: -- to restrain -- to restrain presidential pardons --

MR. BARONE: The better thing is just to keep people --

MR. MCLAUGHLIN: Hold on --

MR. BARONE: -- with terminal proclivities out of the White House.

MS. CLIFT: -- and talking about bringing in President Clinton to testify? I mean, this is way, way overboard for what I believe is going to be a --

MR. MCLAUGHLIN: Okay, let's --

MS. CLIFT: -- lot's of smoke. I don't believe the fire's there.

MR. MCLAUGHLIN: Eleanor, if that doesn't alarm you, let's take a look at Braswell -- Almon Braswell who was pardoned; convicted in 1983 of mail fraud and perjury, current target of federal probe, massive tax evasion and money laundering. His attorney was Kendall Coffey on Gore's Florida legal team. Do you know anything about Braswell? See, this question is now being raised in the gradually going through the pardons he's given. And about 46 of them did not get any clearance at all from the Justice Department to speak of.

MR. BARONE: Well, this is typical of the Clinton administration of either subverting the Justice Department or going around systems of justice to hand out political favoritism. We don't know the full story on why this man, Braswell, got this thing where there was an ongoing --


MR. BARONE: -- Justice Department investigation of him. It was broken in U.S. News, by the way -- this story. But the fact is, this is the sort of garbage that tends to happen when you have a president who is committed to evading and going around --

MS. CLIFT: No --

MR. BARONE: -- the processes of justice.

MR. MCLAUGHLIN: All right, let me -- Michael --

MS. CLIFT: You know, the "Clinton-haters," you know, you really need to give it a rest.

MR. BARONE: No, I think -- I think we're talking about a person --

MS. CLIFT: I think you need to.

MR. BARONE: No, I don't think we need to. I think that we need to continue to look at this. It is important to the American people not to put somebody into the presidential office that has criminal tendencies.

MR. MCLAUGHLIN: Okay, I think this is a good --

MS. CLIFT: You know, I really get tired of being lectured about morality by everybody here, I must say that -- (laughter) --

MR. BARONE: Your morality is just fine, Eleanor.

MS. CLIFT: Well, I think yours is, too.

MR. BARONE: It's Bill Clinton's that's the problem.

MR. MCLAUGHLIN: I think --

MS. CLIFT: But let's not make all of these extraordinary reaches about other people. This is politics, for God's sakes. Let's not act like such innocents. (Chuckles.)

MR. MCLAUGHLIN: I think it's a very cathartic exchange you're having here. (Laughter.)

I want to point out that there's another gentleman whom I have sleuthed out, and he was given a commutation. And his name is, if I can find it here -- is Weinig, Harvey Weinig. Read this, please, along with me, from the New York Law Journal, published three days ago. "Among the 36 prisoners whose sentences were commuted on President Clinton's last day in office was Harvey Weinig, a former Manhattan attorney who admitted helping the Cali cocaine cartel launder some $19 million in drug proceeds through a Swiss bank. Mr. Weinig, now 52, was sentenced in '96 to the maximum under federal guidelines, 11 years and three months." He served five. His sentence was commuted.

Do you think that we'll be investigating whether or not Weinig contributed something?

MS. CLIFT: No. You know, it's not only who --

MR. O'DONNELL: Absolutely. Weinig or his friends should be investigated.

MS. CLIFT: -- not only about giving money; it's about who you know. And his lawyer is Gene Weingarten (sp), who's a very good friend of Eric Holder, who's number two at the --

MR. BARONE: Justice.

MS. CLIFT: -- Justice Department --

MR. BARONE: Was. Yeah.

MS. CLIFT: -- was number two at the Justice Department. And you know, unfortunately, this is how you get your case argued. You've got to know somebody. You've got to have access --

MR. O'DONNELL: Well, but that's not -- (off mike) --

MR. MCLAUGHLIN: If someone has laundered --

MS. CLIFT: I'm not excusing the pardons, but that's how it happens.

MR. MCLAUGHLIN: If someone has played a key role in laundering $19 million of Cali cartel cocaine money, I think to give him a commutation after five years, when he gets 11, is a disgrace.

MS. CLIFT: Well, get his lawyer on to tell the case.

MR. O'DONNELL: Yeah. I mean, you know, these --

MR. BARONE: Without knowing more, it obviously is, from what we know about him.

MS. CLIFT: Right.

MR. BLANKLEY: And it's also a pattern --

MR. MCLAUGHLIN: Okay. Bill -- what is it?

MR. BLANKLEY: It's also a pattern we see. The people with the big illegal money are the ones who are getting the pardons.

MS. CLIFT: This is not money, this is connections.

MR. O'DONNELL: Well, it's the same thing, though, because you'd buy these connections. Jack Quinn was bought. It took a lot of money to buy Jack Quinn.

MR. MCLAUGHLIN: How much? How much?

MR. BARONE: You got a legal fee -- you have about $3,000 --

MR. O'DONNELL: Hundreds of thousands of dollars. To send him in to 20 minutes with the president costs you hundreds of thousands of dollars. That takes a lot of money.

MR. MCLAUGHLIN: Hundreds of thousands? I calculate he got $4 million for it.

(Cross talk.)

MR. O'DONNELL: No, it takes a lot of money.

MR. MCLAUGHLIN: Okay. Bill in Boca.

Clinton's first post-presidency speech Monday netted him $150,000 and was met by demonstrators, starting outside the Boca Raton resort. "Sell the penthouse and get a trailer. It's so you," read one sign. "Hide the women and silverware. Bill Clinton's in town," read another.

Morgan Stanley contracted with Mr. Clinton for the Boca speech. Their Clinton-disaffected clients telephoned in droves, threatening to withdraw their accounts, leading the Morgan Management to craft restraining scripts for 13,000 employees to use to restore calm. "Please don't make emotional decision based on this event," unquote, was one of the lines.

Question for you, Lawrence O'Donnell. Will the antipathy communicated to Mr. Clinton in Boca Raton by demonstrators and by Morgan Stanley clients all over curb Clinton's speechmaking?

MR. O'DONNELL: Tip of the iceberg compared to what will emerge next week, when Talk magazine breaks the story that the golf club that Bill Clinton went back to play at again last week is a restricted golf club -- no blacks, never has had a black. The mayor, Len Miller (sp), of the village, told Clinton -- a Democratic mayor, in 1999, "Please don't play there. It's restricted." Len Miller (sp) is Jewish. He said, "They don't welcome me there." Clinton went and played there. He went and played there again on Wednesday of this past week. That's the next story facing him.

MR. MCLAUGHLIN: Would you think a publicly traded company is going to think twice before inviting Bill Clinton to speak?

MR. BLANKLEY: Well, I mean, there are two sides. His controversy and his interests make him a ripe choice to bring as a spectacle. On the other hand, corporate planners are cautious people, and if he's going to create problems for them, they may very well begin to --

MS. CLIFT: Actually, it's all a plot to drive up the price of his memoirs, in which he will promise to tell all about his bad behavior. (Laughs.)

MR. MCLAUGHLIN: Washington's Ferdinand and Imelda. One hundred and ninety thousand dollars in loot -- that's what the departing Clintons took from the White House, quote, "as if they were ousted third world dictators," unquote, says columnist Andrea Peyser. This week the Clintons returned $28,000 of the permanent White House collection, this on top of the $86,000 of last week's giveback, leaving the former White House couple a balance of $76,000 in gifts.

Question: Inasmuch as Hillary has returned 60 percent of the White House special collection, should New Yorkers give her a fresh start, do you think, Eleanor?

MS. CLIFT: Listen, I hope Hillary has learned that from now on she pays her own way. After a lot of years in public life -- she's still in public life, but the rules of the Senate are different -- she's a rich woman now. She's got to internalize that and leave all the tacky behavior behind. She can recover after a very shaky start.

MR. MCLAUGHLIN: Do you think she gets any credit, or was the angry mob closing in on her? (Laughs.)

MR. BLANKLEY: (Laughs.) Yeah, well, look, what I find interesting is the New York liberals, who didn't mind the impeachment crimes of obstruction of justice and perjury, get very upset when they pocketed the silverware --

MR. MCLAUGHLIN: The flatware.

MR. BLANKLEY: The flatware. And, yeah, I think it hurts. I think it hurts. She'll recover from it in some way, but it's a very inauspicious beginning.

MS. CLIFT: Well, it wasn't the White House silverware, it was flatware solicited as a gift.

MR. BARONE: Well, count the spoons.

MS. CLIFT: It's a different kind of tackiness.

MR. : A different kind of tackiness, yeah! (Laughter.)

MR. MCLAUGHLIN: We have to get out.

Exit question: Have we heard the last of the Rich pardon scandal, or is the worst yet to come? Is it waxing or is it waning?

Michael Barone.

MR. BARONE: Well, I think it's going to continue for awhile. We may indeed hear from Denise Rich. And, of course, she was only over at the White House all those times --

MR. MCLAUGHLIN: You mean they'll grant her immunity?

MR. BARONE: She was up there for policy conferences with Bill Clinton to talk to him about the earned income tax credit, whether we should extend that --

MR. MCLAUGHLIN: So you way waxing.

Eleanor, quickly.

MS. CLIFT: I think he's about right, but modest waxing. I don't think in the end this goes anywhere! (Laughs.)

MR. MCLAUGHLIN: Modest waxing, not full waxing. Some growth left.

MR. BLANKLEY: I think it's going to wane.

MR. MCLAUGHLIN: Going to wane?

MR. BLANKLEY: I think immunity will not be granted.

MR. MCLAUGHLIN: Wax or wane?

MR. O'DONNELL: I find it hard to believe that the Democratic U.S. Attorney of the Southern District of New York, Mary Jo White, is going to watch this pardon over her objections without investigating the dealings between Marc Rich and his wife and the flow of money to the Clinton campaign.

MR. MCLAUGHLIN: Well-stated. Follow the money.

Waxing is the answer.

When we come back, Democrats say that Americans in the 40 percent tax bracket should be excluded from President Bush's across-the-board income tax cuts because they are well-to-do. Will this class warfare sell?


MR. MCLAUGHLIN: Issue two: Taxing our patience.

PRESIDENT GEORGE W. BUSH: (From videotape.) And the average relief for a family of four with two children will be $1,600; $1,600 will pay the average mortgage for a month, $1,600 will pay for a year's tuition at a community college, $1,600 will pay the average gasoline costs for two cars for a year, and $1,600 will buy the average California family 24 months worth of electric power.

MR. MCLAUGHLIN: President Bush kicked off the campaign this week for his 10-year, $1.6 trillion tax cut. Just as quickly, the Democrats kicked back.

SEN. TOM DASCHLE (Senator minority leader): (From videotape.) You know, if you make over $300,000 a year, this tax cut means you get to buy a new Lexus. If you make $50,000 a year, you get to buy a muffler on your used car.

MR. MCLAUGHLIN: At this press conference, a journalist observed that while families were present to represent the middle and bottom tax bracket, no family was present for the top bracket. What about that? "Mr. President, why is there no one representing the top tax bracket?"

PRESIDENT GEORGE BUSH: (From videotape.) Well, I beg your pardon. I'm representing -- (laughter) -- I got a little pay raise coming to Washington from Austin. I'll be in the top bracket.

Our tax cut should not punish success at any stage of life.

No American should pay more than a third of his or her income to the federal government in federal taxes.

MR. MCLAUGHLIN: This equity point may win some supporters for Mr. Bush, but the more persuasive argument for cutting taxes of the well-off, many believe, is that when their bracket is included, the economy takes off. In the 1960s, President Kennedy cut top marginal tax rates of the affluent from, believe it or not, 91 percent to 70 percent. Federal tax revenue then went up and the economy boomed. In the '80s, Ronald Reagan cut marginal tax rates from a top of 70 percent to 28 percent. Revenues from taxpayers earning $400,000 and up rose by an amazing 25 percent in four years.

And the rich will still pay more in taxes. Bush's top tax rate cut of 6.6 percent, 39.6 to 33, leaves the distribution of the tax burden unchanged. Everyone under the plan will pay less off the top, but the relative burden stays the same. In the highest bracket, the top 10 percent will still account for 90 percent of all tax revenues.

Exit question: It's a foregone conclusion, there will be tax cuts this year. So this is an end-game question. When the dust settles, will the tax cut primarily resemble Bush's plan or will it primarily resemble the Democrats' plan? Michael Barone?

MR. BARONE: John, minor correction. Under Bush's plan, the highest income-tax payers will actually provide a slightly larger percentage of the revenues than they do at the present, but it's basically similar to what we've got now. It will tend to resemble more the Republican plan if George W. Bush and the party leadership keeps this from becoming a Christmas tree for business interests who want to tack their things on. Then it might get in trouble.

MR. MCLAUGHLIN: Are you persuaded by the insightful arguments presented in that set-up that in fact, if there is a tax cut for the top bracket, it will redound positively and vigorously to the macroeconomy?

MR. BARONE: Well, there's no question that when you give people more money, it tends to have a positive effect -- (inaudible) -- revenue analysis --

MS. CLIFT: Only if you give people at --


MR. CLIFT: -- if you give people at the lower end of the income scale do they spend it. This is a raid on the treasury that the Democrats don't have the votes or the spine to stop. The top 1 percent of wage earners pay 20 percent of taxes. They'll get 42 percent of this tax cut. It's outrageous.

MR. MCLAUGHLIN: Yeah, but it all comes back, though.

MR. BLANKLEY: This is going to be like the battle of Stalingrad. It's going to be very hard. The Republicans are going to have to fight for every vote. I think at the end of the day, they're going to hold the Republicans and, on a largely party-line vote, get most of the Republican bill.

MR. O'DONNELL: Bush is going to get most of what he wants. But it's crazy to suggest that taxation has anything to do with the industriousness of the top income tax bracket. The biggest surge in the history of the income stream of the top income tax bracket occurred after Bill Clinton raised their taxes during the '90s.

MR. MCLAUGHLIN: Wrong. The top tax bracket should be cut for the health of the economy.

We'll be right back with predictions.


MR. MCLAUGHLIN: Predictions. Fast. Michael.

MR. BARONE: Donald Rumsfeld's Pentagon will have missile defense specifics within six months.


MS. CLIFT: Bush will veto the Campaign Finance Reform Bill if it reaches his desk.


MR. BLANKLEY: New Prime Minister Sharon will put Shimon Peres into his new cabinet.

MR. MCLAUGHLIN: Interesting. Lawrence.

MR. O'DONNELL: Bush will, in the end, make a deal on the litigation provisions of the Patients' Bill of Rights.

MR. MCLAUGHLIN: The Bush administration will change its focus in the Middle East peace process due to the election of Ariel Sharon as prime minister. Instead of the Israel-Palestine track, President Bush will pursue, dominantly, the Israeli-Syria track.

Next week, an on-site report from Damascus, Syria, rendered by the host of the McLaughlin Group.

Happy Valentine's Day. Bye-bye.


MR. MCLAUGHLIN: Issue Three: The two faces of Terry.

TERRY MCAULIFFE: (From videotape.) If Katherine Harris, Jeb Bush, Jim Baker and the U.S. Supreme Court hadn't tampered with the results, Al Gore would be president, George Bush would be back in Austin, and John Ashcroft would be home reading Southern Partisan magazine.

MR. MCLAUGHLIN: (From videotape.) That's one face, the vindictive one, of Terry McAuliffe, the new chairman of the Democratic Party. Now here's Terry's kinder, gentler face.

TERRY MCAULIFFE: (From videotape.) We're all tired of the politics of personal destruction. Let's keep the focus on issues, let's have a healthy debate on the issues

MR. MCLAUGHLIN: (From videotape.) The new DNC Chairman may be the key to Democratic success in both the 2002 and 2004 elections, so here's a closer look at Mr. McAuliffe.

The pluses:

1) Money-raising Colossus, over $500 million for Democrats in the last two years, the party's top fundraiser.

2) Personality. Upbeat, energetic, incredibly engaging, puts everyone at ease.

3) Natural Leader.

4) 21st Century Innovator, wants to double the DNC budget for communications, research and technology.

McAuliffe's Minuses

1) Money Raising Colossal, embodying the money-for-access, Lincoln bedroom Motel 6, style that so tainted the Clintons.

2) Possible Indictment, by the U.S. Attorney in Manhattan, looking into charges that McAuliffe OKed the 1996 money laundering of Teamster election funds.

3) Joined to the Clintons at the Hip, With Democratic 2004 Presidential hopefuls viewing McAuliffe as Prime Minister of the Clintons' new shadow government, with Hillary waiting in the wings to make her White House move.


Question: Is McAuliffe too close to the Clintons for the good of the DNC -- the party?


MS. CLIFT: He's already said that Hillary's not going to run for president in 2004, but --

MR. BARONE: So obviously she will.

MR. MCLAUGHLIN: Don't bring that to the bank --

MS. CLIFT: I don't think so -- (laughter) --but look, he has got the energy, the commitment, the wherewithal. He's going to put together a message machine. The Democrats are completely in the wilderness, having lost the White House. They don't control any of the levers of power. He will be the megaphone. And if he's a mouthpiece for Clinton, I think that's trouble in the short run, but I think that works out.

MR. : Yeah.

MR. O'DONNELL: But the problem is not going to be his close association with the Clintons. A great party chairman like Paul Kirk and Ron Brown, who did a very good job, had very close associations with Ted Kennedy. But they were both professional politicians, they had experience in government. The problem with Terry McAuliffe is he's just money bags. That's supposed to be a separate function in party politics. He's never worked in government. He doesn't know politics.

MR. BARONE: He doesn't --

MR. O'DONNELL: He's going to raise the visibility of the office, but that's bad news.

MR. BARONE: I think --

MR. MCLAUGHLIN: When you're beaten in politics, go back to your base.

MR. BARONE: Well, this is going back --

MR. MCLAUGHLIN: Don't you think Terry McAuliffe is perfect for the base?

MR. BARONE: Well, this is going --

MR. BLANKLEY: You know, look --

MR. MCLAUGHLIN: The base continues to love Clinton.

MR. BARONE: Well --

MR. BLANKLEY: Yeah, look, he's, you know, a smiling race-baiter, which is exactly what the Democrats need right now. He wants to play the black resentment in Florida and try to get -- for reelection in 2002. I think he's actually going to be very good for the Democrats, unless he gets indicted.

MR. BARONE: John, I think that he's not --


MR. BARONE: Look, the fact is this is the guy that gave us the Lincoln Bedroom as a fundraising device. I think the bigger problem here is not just Terry McAuliffe -- the bigger problem for the Democrats -- but also Bill Clinton. I mean, he is taking a role as former president which no president has ever done, except since Grover Cleveland.

(Cross talk.)

MR. MCLAUGHLIN: Who will really emerge as the leader of the Democratic Party? Will it be Hillary, will it be Gore, or will it be McAuliffe?

MR. BARONE: They -- no, it's --

MS. CLIFT: No, it's going to be potential presidential candidates. It might be John Edwards from North Carolina. It might be John Kerry of Massachusetts. There's going to be lots of people speaking out --

MR. MCLAUGHLIN: And the answer, Eleanor, is --

MR. O'DONNELL: It's going to be Daschle.

MS. CLIFT: No, this is not an official answer --

MR. MCLAUGHLIN: The answer, Eleanor, is Hillary.

MR. O'DONNELL: Tom Daschle is going to be the leader of the party.