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MR. MCLAUGHLIN: Issue one: Shift happens.

SEN. ROBERT BYRD (D-WV): (From videotape.) The majority leader is recognized.

MR. MCLAUGHLIN: The seismic power shift, Republican to Democrat, has transformed the U.S. Senate from a George Bush legislative greenhouse into a George Bush legislative graveyard.

The president moved quickly to stop the PR hemorrhaging from the Jeffords defection. Step one: Be boldly personal. Woo Senate power brokers. Invite them to the White House for a sitdown on the Bush education bill. Ted Kennedy. Joe Lieberman. And the defector himself, Jim Jeffords.

SEN. JAMES JEFFORDS (I-VT): (From videotape.) This was a most reassuring moment. We came together and began to understand how much we had in common.

MR. MCLAUGHLIN: Next in Bush's healing offensive was John McCain. He was invited to the White House for a private dinner to discuss, among other things, last weekend's worrisome Arizona meeting between McCain and Majority Leader Tom Daschle. Then it was Senator Lincoln Chafee's turn at the White House with the commander in chief. Finally, the week's crescendo, Daschle himself, Thursday night at the White House to be wined and dined -- an invitation Daschle welcomed.

SENATE MAJORITY LEADER TOM DASCHLE (D-SD) (From videotape): The one thing I am going to emphasize is fairness. You've heard us lament and in some ways criticize the majority, when we were in the minority, for the lack of fairness. I think it would be hypocrisy at its worst if we were to take the same tactics.

MR. MCLAUGHLIN: Question: Is the loss of the Senate a major setback for Bush, or is the damage really overstated? Lawrence Kudlow?

MR. KUDLOW: I think the loss is overstated. I think the whole story's overstated. Look. I acknowledge, now, that the tide has turned a little bit in the Senate, but George Bush, I think, still has 56 to 58 votes, with the John Breaux, Zell Miller Democrats, for major pieces of legislation. And I thought Bush himself put it rather well. He said the landscape has changed but the continent is the same; meaning he knows on key votes for energy production, market-oriented health care, and Social Security reform, he has a coalition that can win in the Senate.

And by the way, John, let's not forget Bush just passed a huge across-the-board tax cut, which is a signature political-economic achievement, which, by the way, is helping to promote a major stock market revival.

MR. MCLAUGHLIN: Do you think it will revive his ratings when people receive $300 to $600 in refund, or whatever it's called?

MR. KUDLOW: I think the refunds are going to help him. I don't think that's the best part of the bill. The best part of that stuff is new tax rate incentives for middle-income and upper-income taxpayers. But folks like lower taxes, and the tax cut really closes down Democratic spending initiatives for the next couple of years.

Eleanor, is the real loss the loss of the Republican chairmanships? They lose their prestige, they lose their powers that are inherent in those positions. Is that where the real loss is, in your view?

MS. CLIFT: Well, I'm sure for individuals that's a major loss, but what the real loss is, is the loss of the agenda. The issues you're now going to see on the Senate floor -- Patients Bill of Rights, a boost in the minimum wage -- those are not issues that were at the top of the Bush agenda. And, frankly, if there is that old silver lining there for the president, he's going to have to accommodate the Democrats on those issues, and there will be Rose Garden ceremonies, and in four years when he runs for reelection he can talk about how he got a Patients Bill of Rights and boosted the minimum wage. Those are the issues that real people care about.

The Senate has actually saved Bush from himself and an agenda of issues that most people do not support. (Laughter.)

MR. MCLAUGHLIN: Do you draw comfort from that --

MR. BLANKLEY: No, no. Look, the fact is that this is a fairly devastating event for Bush. He has, as Eleanor says, lost control of the agenda. The Republicans cannot bring a bill to the floor of the Senate without Daschle's approval. They can get it on the union calendar, but they can't get it to the floor. Now, the reality is the Democrats are going to use oversight hearings in a devastating manner to try to pick the weaknesses in the Bush agenda, and --

MR. MCLAUGHLIN: Like how tight Bush is alleged to be with big oil?

MR. BLANKLEY: Well, sure. And they're going to try to separate out Rumsfeld from Powell. Biden's already promised to do that, on the Foreign Relations Committee.

MR. MCLAUGHLIN: Is ANWR off the table?


MR. MCLAUGHLIN: Is the missile shield off the table?

MR. BLANKLEY: Not necessarily. It depends how that's played. But the fact is that if you look over the horizon, there's a not a good winning opportunity for Bush for the next several months and he's going to have a very bad run, I would think, over the next four to six months.

MR. MCLAUGHLIN: How do you feel about this from your perspective, Gerry Baker?

MR. BAKER: I think I agree with Tony that this is a pretty serious setback. It is about the agenda. It is also about, as Tony says, the ability of committees to set an investigative tone, too, and we are, actually, we've already seen this week Lieberman, Senator Lieberman, saying he's going to investigate these connections between energy companies and the Bush administration, exactly what role they played in the formulation of the energy policy. There will be -- you can guarantee there are a lot of Democrats -- you know, I think we're in a kind of slightly phony period this week, with this extraordinary, kind of, love-bombs exploding everywhere between the White House and the Democrats.


MR. BAKER: I should think that period is going to be over pretty soon. You're going to have more investigations, you're going to have a Democratic-controlled agenda, and it's going to be -- I think it's going to make life pretty --

MR. MCLAUGHLIN: Do you think that the political forces at work are so overwhelmingly powerful that they will neutralize, if not void completely, all this happy talk? For example, the Republicans -- George Bush has rolled back the Clinton agenda in many different areas, and he has enraged some of the constituents of that agenda, some of the special interests.

Secondly, there was the role of the judiciary in settling who won the election. The Democrats have not forgotten that. And third, there is 2002 coming up, and 2002 is where the focus is going to be. With those forces coming together, is it not going to be a cutthroat climate?

MR. BAKER: Well, I think you may well be right, John. I think the climate is going to be extremely -- as you say, a lot of Democrats are going to seek payback, because, as you say, both because Bush has rolled back some of their favorite plans, taken a completely different attack on other things, and there will also be a sense -- remember that the Republicans --

MS. CLIFT: Well, he has --

MR. BAKER: When the Republicans controlled -- when the Republicans controlled the Congress under Bill Clinton, there was, for six years, there was a culture of -- there was no question that there was a culture of investigation of the president that actually contributed to a very unproductive environment, and I don't think the Democrats are going to do the same thing. I think they're going to move on --

MR. MCLAUGHLIN: Why is John McCain meeting so actively with the Democratic leadership?

MS. CLIFT: John McCain has done the equivalent of putting on a sandwich board and advertising himself -- (laughter) -- as somebody who can put together a coalition that includes a lot of Democrats and maybe a couple of Republican moderates. He wants to be, in the Republican Party, what John Breaux is in the Democratic Party. And John Breaux, you'll remember, once famously said, "I can't be bought, but I can be rented" -- (laughter, cross talk) -- and I think John McCain is very much available now, and he's popular with the American people and with the press.

MR. BLANKLEY: With the rise of independents in this country, up to about 35 percent self-identified independents or third parties, the potential for McCain to run as an independent in 2004 is very real. He's been moving his issues, his positions, to accommodate that part of the spectrum --

MR. MCLAUGHLIN: You mean, further to the left?

MR. BLANKLEY: Further to the left.

MR. MCLAUGHLIN: He's removed remarkably to the left, even since the election, has he not?

MR. BLANKLEY: Yes, on gun control, on --

MR. KUDLOW: (Off mike.)

MR. BLANKLEY: And the only issue he hasn't moved on yet is abortion.

MR. MCLAUGHLIN: However --

MR. BLANKLEY: So if you see him move to an abortion position, you know he's going to vote as an independent.

MR. MCLAUGHLIN: However, the press, I think, overstated the meeting in Sedona with John McCain at John McCain's famous ranch there because that meeting had been set up three months ago.

MR. BAKER: The other thing he did, which was very interesting, was he voted against the tax cut.


MR. BAKER: He was one of only two Republicans to vote against the tax cut.


MR. BLANKLEY: (Off mike.)

MR. BAKER: But if this tax cut does turn out, as a lot of people think, to be fiscally very irresponsible and to lead to a lot of problems, he can say, "I told you so --


MR. MCLAUGHLIN: And he's also annoyed by what else: campaign finance reform and the way that we're treated by Trent Lott, correct?

MR. BLANKLEY: That's true. It is true, but keep in mind that he did -- McCain did vote for the tax bill in the earlier iteration when it was necessary to get the votes, and then on final passage he voted the other way. So there is a little bit of ambiguity there.

MR. MCLAUGHLIN: Who do the Republicans blame for this setback? Do they blame Trent Lott; do they blame Bush? Who takes the rap?

MR. KUDLOW: Oh I think, you know, there's blame -- the blame game lasted for a few days; probably Trent Lott took the worst of it in political terms inside the beltway, but this too will pass. I mean, look --

MR. BLANKLEY: I don't think --

MS. CLIFT: You know who gets -- the American people are blaming George W. Bush, because what you --

MR. KUDLOW: Eleanor, that is your fantasy.

MS. CLIFT: Excuse me, let me finish. You may disagree, but this administration now looks like it is governing from the right, and the American people thought that they had installed a moderate, and that is big problems for Bush.

MR. KUDLOW: Eleanor, this administration --

(Cross talk.)

MR. KUDLOW: The absolute key point here is that the tax cut plan is going to restore economic growth, that Bush is going to look great because people favored -- if Tom Daschle wants to repeal the tax cut, he will pull the Democratic party to the left and --

(Cross talk.)

MR. BLANKLEY: Let me answer --

MR. MCLAUGHLIN: I want to ask the exit question and you can fill in what you have to say then. We've got to get on.

MR. KUDLOW: : -- Zell Miller and Ben Nelson will all desert him, along with John Breaux. Daschle does not have control of his own Senate. That is the key point.

MR. MCLAUGHLIN: Let's assume you're giving advice to George Bush for the next couple of years. Should he focus more on politics or should he focus more on policy?

MR. KUDLOW: Oh, no, stay with the one that you brought to the dance. His policy calls are in tune with the investor class, the ownership class, the business class.

MR. MCLAUGHLIN: When you saw --

MR. KUDLOW: He has a chance to reform Social Security and health care along pro-market lines. He can get this done.

MS. CLIFT: Larry --

MR. MCLAUGHLIN: You saw Teddy Kennedy sitting to his immediate left at that meeting at the White House, and down, three away, was Jim Jeffords himself. Surely Bush has learned the lesson very well that in politics you bring your friends close --

MR. KUDLOW: Right, and your enemies closer.

MR. MCLAUGHLIN: -- and you bring your enemies closer.

MR. KUDLOW: That's right.

MS. CLIFT: I want to say two things. One, the way the White House has handled the Education Bill should be a model for how they act on everything else.


MS. CLIFT: There had been so many bipartisan --

MR. MCLAUGHLIN: Do you mean because it's a Democrat bill? That's why. (Chuckles.)

(Cross talk.)

MS. CLIFT: Secondly, Larry Kudlow may be happy with this tax plan, but 40 percent of Americans are not going to get a check in the mail, and Bush is not going to get credit --

MR. BLANKLEY: Let me get into this one.

MR. KUDLOW: Eleanor, you're completely wrong.

MR. BLANKLEY: One of the problems that Bush is going to have -- if he's not very careful, he's going to alienate the center of the Republicans in the Senate. As he plays to Kennedy, as he plays to the moderates, he runs the risk of alienating the center members. And that, I think, is a real danger for him.

MR. MCLAUGHLIN: Bush is down about eight points from where he was six weeks ago. Do you think he'll recover, and how long will it take?

MR. BAKER: To some extent, he did have unusually high favorability ratings, I think, straight after the China incident. I think to some extent his ratings went up after that and he's down from that. But it's clear, as Eleanor says, that the American people, I think, do feel that they've been short-changed here. They didn't think they were voting for a president who was going to follow an agenda which has been essentially very, very pro-producer on the energy front, aggressive on the international front --

MR. MCLAUGHLIN: Shall I throw another word at you?

MR. BAKER: -- progressively pro-tax cuts --

MR. MCLAUGHLIN: Unilateralist?

MR. BAKER: Unilateralist --

(Cross talk.)

MR. MCLAUGHLIN: Okay, I think you've got them all, haven't you?

MR. BAKER: (Off mike) -- Social Security, and I think there is a good chance the Senate is going to save President Bush's tax plan.

MR. MCLAUGHLIN: Well, the answer is -- clearly is, put the policy in the backseat and get the politics up front, as he's doing now.

MR. KUDLOW: No, no.

MR. MCLAUGHLIN: We'll be right back after this.


MR. MCLAUGHLIN: Issue two: On the road in Russia.

George Bush will meet with Vladimir Putin next Saturday. This will follow four intense days of meetings in four cities: Madrid; Brussels; Goteborg, Sweden; Warsaw, with 19 NATO heads of state and 15 European Union heads of state. The last day of the trip in Slovenia, history could be made when, for the first time, George Bush meets with Vladimir Putin.

This weekend last, on a background reporting tour, the host of this program visited Moscow and St. Petersburg in Russia. Putin was born, grew up and lived the critical part of his political career in St. Petersburg. And from that city he has drawn his, quote, unquote, "St. Petersburg team" that now, with him, governs Russia. Here are the main points of the Russia report:

One, Russia fears Islamic fundamentalism in Chechnya, Tajikistan, Dagestan, the Taliban from Afghanistan, Georgia and elsewhere; republics within the Russian Federation and states within the CIS that feed terrorist rebels across borders, especially into Chechnya. Russian elites and non-elites alike believe that Putin, under no circumstances, can permit Chechnya to fall. If Putin were to lose Chechnya, it would serve as a model to Muslim fanatics everywhere, causing a domino reaction. Further, Russians believe that, just as the Balkans flew apart when Tito died, so Putin must use an iron hand over ethnic minorities or Russia will become a Balkan hell.

Two, Russia is choking in debt: $150 billion is owed by the Russian Federation, $100 billion of which is a carryover from the Soviet era. Of the $50 billion remainder, $5 billion has been paid off.

Three, Russia expects Bush to question whether Putin can really assert himself against the ultra-monied elites shaped during the Soviet and Yeltsin eras. Putin will point out to the oligarchs that he has already disenthroned, notably and very recently, the nine-year entrenched CEO of Gazprom, the huge company that is called a state within a state that generates 20 percent of Russia's tax revenue and 7 percent of its total GNP. Putin replaced the dumped CEO with a 39-year-old St. Petersburger, Alexei Miller, who worked for Putin in that city and has been his friend for over a decade.

Four, Russia expects Bush to question Putin about freedom of the press. The principle focus is on NTV, Russia's biggest national television network, which was controlled until early May by oligarch, Vladimir Gusinsky, now in exile. Gusinsky himself admits that he used his media empire to achieve political goals. During the Russian presidential campaign, Gusinsky supported for president the skilled mayor of Moscow, Yuri Luzhkov. This Gusinsky support was translated to television with hard-hitting, on-air critiques of Putin and Putin's handling of the Chechnyan war.

Gusinsky alleges that his media empire was strangled because of its independence. "Hardly," says the editor of a Russian newspaper associated with the Financial times. Gusinsky's holding organization, Media-Most, whose chief unit was NTV, was "leveraged to the hilt with debts of more than, " get this, "$1 billion." So the Kremlin moved in and was able to unseat Media-Most on credible business grounds because Media-Most was so dependent on the state for funding.

A final fact that has been noted is that President Putin has not jailed a single journalist; he has not closed or censored a single independent publication.

Five, Russia expects Bush next Saturday to urge Putin to take part in an interdependent U.S.-Europe missile shield. Here's a not-improbable scenario.

Putin will inquire, quote: "Is there an inducement to do so?"

Bush will say: "Yes, jobs for your Russian workers, and U.S. purchases of your components in the construction and maintenance of the European shield; surface-to-air missiles, for example."

Putin will inquire: "Anything else? Like, can you help with our staggering federal public debt; say, specifically, of the $30 billion owed to Germany or the $17 billion owed to the IMF and the World Bank?"

To which Mr. Bush will say: "Yes, we can help you with that, at least in restructuring. We understand your cash needs, Vladimir. But no oligarchs. Got it?"

To which Mr. Putin will say: "Your distaste for oligarchs, George, can't possibly match mine. I have de facto expelled three; Gusinsky, Berezovsky, and now, in benign exile, Viktor Chernomyrdin, our new Russian ambassador to Ukraine."

Conclusion: Some believe, including this observer, that Bush's visit with Putin could be as historic as Richard Nixon's visit to China. On Nixon's visit, he played the China card against Russia. In this instance, Bush plays the Russia card against China. This amounts, of course, to a radical shift in U.S. policy towards what a decade and a half ago was called by Ronald Reagan "the evil empire." But at this meeting next Saturday, Russia may well be treated by President Bush as "the friendly federation."

Question: Gerry Baker, in your report, in this country and abroad, what have you seen or heard that might support or deny the basic proposition of that report?

MR. BAKER: The basic proposition is right. This is going to be a really significant meeting. There's going to be a definite opening by the United States, by the Bush administration to Russia. And it's really quite remarkable because not only, as you say, did Ronald Reagan term the Soviet Union "the evil empire"; even as recently as last year, during the election campaign, the Bush campaign were making very negative noises about Putin. We kept hearing that he was ex-KGB guy, that he was clamping down on dissent at home. There was a lot of concern expressed about him.

Now that's completely changed. It's partly to do with China, as you say, but it's also partly to do with the Europeans, and even, to some extent, with the change in control in the Senate, because what it's about, it is about principally getting Russian support for missile defense so that this project can go through, so that President Bush can do an end run around the Europeans, who don't -- the Western Europeans, who don't like the idea of missile defense, and even around the Democrats, who don't like the idea of missile defense.

MR. MCLAUGHLIN: You mean it's possible, ironically enough, that if the European Union and NATO countries leave Bush high and dry on missile defense, Putin might save him.

Let me ask you this. We know he wants missile defense. Is the president and this administration also worried as towards some extent Putin at certain times about the growing and deepening of the Sino-Russia detente, to the point where we now stand on the threshold of their signing a friendship pact, those two powers, and the suspicion is that there are protocols, hidden protocols about mutual protection in the instance of bellicosity, war or whatever, and we don't know, and the president wants to head that off by holding China in check -- excuse me -- yeah, holding China in check through playing this Russian card?

MR. BAKER: Yeah, there's an element of that. Clearly, there is a big danger for the U.S. in a Russia-Chinese rapprochement, and that is something that they will try and head off. And it will be particularly tough. But the main target of all this is Western Europe, in particular, and also because I think they are genuinely concerned, the administration is genuinely concerned. Defense Secretary Rumsfeld has been in Europe this week explaining just how great the threat is from these rogue states to the United States and also to Europe.

(Cross talk.)

MR. MCLAUGHLIN: Now, one moment. Before I let Tony throw some cold water on this whole idea, let me ask you this. Have you in Europe heard anything from particularly any conservatives that now think that this type of a rapprochement with Russia is not only doable but desirable?

MR. BAKER: There is some change going on in Europe. The Europeans are beginning to sound a little bit -- I mean, some of --

MR. MCLAUGHLIN: Any American conservatives?

MR. BAKER: I'm not sure about American -- yeah, American conservatives, they'd be --

(Cross talk.)

MR. KUDLOW: He doesn't know any. He doesn't know any American conservatives.

(Cross talk.)

MR. MCLAUGHLIN: Yes, he does. He knows Richard Perle, don't you?

MR. BAKER: Well, sir, yes, I do. There is a definite belief that there are things that the United States can do, concrete things, certainly military-to-military assistance, and possibly even financial assistance, as you mentioned in your extremely interesting report -- (laughter) -- that there are things that can be done which the U.S. can do which could appeal to the Russians; that could actually --

MR. MCLAUGHLIN: Gerry, you -- was my report accurate? Was it enlightening?

MR. BAKER: It was extremely enlightening --

MR. MCLAUGHLIN: We've got to get you back on this show, Gerry. (Laughter.)

MR. BLANKLEY: Let me suggest that this is part of a larger initiative. Bush is also making a reach to Japan and India. You combine that with the reach to Russia, and you're beginning to have a containment policy against China --

MR. MCLAUGHLIN: Interesting!

MR. BLANKLEY: -- which Rumsfeld has identified as the primary military danger to us in the future. So this is part of a much larger international move, and it's a part, by the way, of Bush's courage in showing some unilateralism in the face -- in the face of European --

MR. KUDLOW: That's the key point. That's the key point.

(Cross talk.)

MR. MCLAUGHLIN: Blessed unilateralism.

(Cross talk.)

MR. MCLAUGHLIN: We've got him on board, and enlarging the whole concept!

MS. CLIFT: I feel like I've stumbled into a meeting of the National Security Council here. (Laughter.) Look, this is an opening meeting.

MR. BLANKLEY: We could only wish.

MS. CLIFT: This is an opening meeting. These two fellows are just going to take measure of each other. I wouldn't be this dramatic about what's happening. Secondly, I think what George W. Bush really is looking for is a legacy, and that legacy is to dismantle the missiles of the Cold War, as an antiquated part of our past.

(Cross talk.)

MR. BLANKLEY: He's planning to do that -- (cross talk) -- unilaterally. And that's what -- that's what --

MR. MCLAUGHLIN: Quickly -- five seconds.

MS. CLIFT: And the missile defense shield is a small part of that strategy.

MR. MCLAUGHLIN: Let him end. We've got to go.

MR. KUDLOW: First of all, the United States does not need Russia's support or permission to start a missile shield system. That's something you missed. Secondly, of all, the Cold War is over and you're trying to nixonize this meeting, just as you incorrectly tried to nixonize George Bush's position in Washington. And thirdly, although Russia has done some teensy, weensy good things on the economy, like tax reform, it is a miserable economic situation. And --

(Cross talk.)

MR. KUDLOW: Let me make that point --

(Cross talk.)

MR. MCLAUGHLIN: Quickly! Quickly!

MR. KUDLOW: And the whole European economic malaise makes that part of the world much less important than Asia and China.

MR. BLANKLEY: The end -- the end of the Cold War does not mean the end of international -- (inaudible).

(Cross talk.)

MR. MCLAUGHLIN: Gerry, I don't where to begin to -- I don't know where to begin to correct this hysteria, do you?

MR. BAKER: I'm no longer --

MR. MCLAUGHLIN: We've got to get out. We'll be right back with predictions. (Laughter.)


MR. MCLAUGHLIN: Predictions, Lawrence. Three seconds each.

MR. KUDLOW: Steve Forbes is actively looking at a New Jersey Senate race when Mr. Torricelli goes down.


MS. CLIFT: Putin will sign a bill authorizing Russia as the international repository for nuclear waste.

MR. MCLAUGHLIN: Yes, he will, and I was told today that we are looking at it seriously. Yes.

MR. BLANKLEY: Bush's poll numbers will drop about five points by the fall.

MR. BAKER: The Federal Reserve will cut interest rates again this month and probably again later in the summer and keep tracking until this --

MR. MCLAUGHLIN: By how much this month?

MR. BAKER: Probably only 25 basis points.

MR. MCLAUGHLIN: Beijing will host the Olympics in 2008.

Next week, President Bush's foreign policy Olympics -- five cities, five days, plus a first-time one-on-one with Vladimir Putin. Bye bye!



MR. MCLAUGHLIN: Issue three: What's the big deal? "Give me a break. An underage college student trying to buy alcohol at a bar. That doesn't happen at least a thousand times a day? If it had been Chelsea Clinton, she wouldn't have even made this liberal ink." So states a newspaper letter-writer condemning the media circus that has surrounded the president's twin daughters, Jenna and Barbara. The press is having a field day from its critiques of the Bushes' parenting skills, speculation about juvenile alcoholic tendencies, and vapid, endless pop psychologizing. Former first lady and grandmother of the twins Barbara Bush put the matter in perspective.

BARBARA BUSH (former first lady): (From videotape.) And now to see that same fellow that I used to drive around in Little League carpools, and I used to yell at to please pick up his room -- to see him as president is truly amazing -- (laughter) -- although he is getting back some of his own. (Laughter.)

MR. MCLAUGHLIN: Question to Eleanor: Would the press have given Chelsea Clinton the same type of coverage?

MS. CLIFT: If Chelsea Clinton was caught underage drinking in a bar, I'm sure that would have made the press as well, and it probably would have been seen as a commentary on the parenting skills of her parents.

But you know, having said that, I mean, you have to report this, because it's a matter of public record. It's happened apparently three times with one of the twins and once with the other. And -- but it's past, John. It was like a summer storm, and the tabloids went nuts for few days. It's over with.

MR. MCLAUGHLIN: Well, tell me this, Eleanor; on points, here -- on point, you say they have to report it, because it's a matter of public record. Well, how many misdemeanors are committed in the United States -- like multiple millions -- that are not reported, because they're misdemeanors. You know, this here is a misdemeanor.

MR. BLANKLEY: Right, but --

MS. CLIFT: Because the media industry is a huge industry, and somebody's going to report it --

MR. BLANKLEY: But Eleanor -- Eleanor, Eleanor --

MS. CLIFT: Excuse me.

MR. MCLAUGHLIN: You have changed your argument.

MR. BLANKLEY: It is not --

MR. MCLAUGHLIN: The legality is not the reason.

MS. CLIFT: (Laughs.)

MR. MCLAUGHLIN: What we are talking about here is coldblooded commerce.

MS. CLIFT: No, I think if this was -- no, if this was not reported at all, the press would have legitimately been accused of covering it up, and --

MR. BLANKLEY: Look, Eleanor, you're wrong again.

MS. CLIFT: I don't think so.

MR. BLANKLEY: It is not past. People magazine is going to put this on their cover, you know, so the media --

MS. CLIFT: They're going to put the twins on the cover, probably. They're 19 years old. They're not infants.

MR. BLANKLEY: They're going to put the twins, about alcohol, on the cover. They never reported when Chelsea went out smoking.

MS. CLIFT: That's not illegal.

MR. BLANKLEY: No, but her mother was on a jihad against tobacco, and they never reported that story.

MS. CLIFT: That's an extremely weak argument.

MR. MCLAUGHLIN: Let's talk to this Brit. Now this Brit, he comes -- he knows the London scene, and he knows the attractiveness of tabloids. What do you think of this?

MR. BAKER: This is not -- what it isn't -- one thing I'm sure it isn't -- it isn't part of the liberal media conspiracy to get at President Bush. It would be the same -- as Eleanor says, it would be the same whoever it was. It's just prurient, it's unattractive, it's very unappealing, but it's going to happen. It does -- it happens --


MR. BAKER: I have to say it happens -- you know, you should be very pleased; it happens much less in this country than it happens, as you say, in Britain. And it's horrible, and they should just leave it all well alone, in my view.

MR. MCLAUGHLIN: Why -- I'm not satisfied with that, because -- why do conservatives' transgressions or members of the family's transgressions always seem worthy of high-powered news, unless the liberals reach the level of say, Chappaquiddick, and then they decide to write something on that?

MS. CLIFT: Oh, come on, John!

MR. BAKER: I think people --

MS. CLIFT: Remember Billy Carter and all the attention he got?

MR. BAKER: Yes, and Roger Clinton, too. I mean, look at the attention that he got.

MS. CLIFT: Exactly.

MR. MCLAUGHLIN: You want to speak to this? We're almost out.

MR. KUDLOW: I don't think it's a left-wing conspiracy. I think it was a bonehead play by the Bush girls. You know, their dad's president. They ought to watch their behavior and figure out and assume that somehow it's going to be on the cover of some unsavory publications. That's all it is. Just don't do it again.