MR. MCLAUGHLIN: Issue one: Is Syria number two?

SECRETARY OF STATE COLIN POWELL: (From videotape.) We are concerned about Syria's continuing support of terrorist organizations. And in recent weeks we have been concerned about the flow of material across the Syrian border into Iraq, as well as the flow of individuals back and forth across the Syrian-Iraq border.

MR. MCLAUGHLIN: No sooner had President Bush declared victory in Iraq than the White House announced that a new Middle Eastern state is now in the cross hairs. The target: Syria.

The tough rhetoric was swiftly followed by action as U.S. military engineers in Iraq cut an oil pipeline that carries some 200,000 barrels a day from Iraq to Syria. The cost to Syria: between $500 million and $1 billion annually. Moreover, the U.S. has threatened Syria with trade sanctions.

But on Thursday, Secretary Powell appeared to tone down the rhetoric by declaring that he looked forward to candid talks in Damascus about Syria's alleged transgressions.

Question: Is there a danger that the brinksmanship with Syria could escalate, Pat Buchanan?

MR. BUCHANAN: I don't believe there is, John. The United States of America -- the president does not have the authority from Congress to attack or invade Syria. Syria is not under any U.N. resolution. Syria has not threatened us in any way. The Spanish and Brits said they would not go into Syria. If we go in, we would have one ally. That would be Israel.

I think what we are doing is we're using the leverage from our attack and our victory in Iraq to try to pressure Syria to do a couple of things: get out of the Bekaa Valley, maybe give up those chemical weapons, stop supporting Hezbollah.

What we are going to do and what is legitimate is -- us to use our diplomatic and economic leverage to try to get Syria to be a more responsible party in the Middle East negotiations. I agree with that. I think you are going to get the Syria Accountability Act, however, which calls for sanctions, from the Congress of the United States.

MR. MCLAUGHLIN: The Bekaa Valley is in Lebanon. What's going on in the Bekaa Valley?

MR. BUCHANAN: The Bekaa Valley has been a haven of terrorist training camps for years. Out of the Bekaa Valley came the people who blew up --

MR. MCLAUGHLIN: Who runs them?

MR. BUCHANAN: The Iranians help them out, but a lot of -- they get assistance through the Syrians as well. And it's been a haven --

MR. MCLAUGHLIN: You're not talking about Syrian troops out of Lebanon, are you?

MR. BUCHANAN: There are Syrian -- 35,000 Syrian troops in Lebanon. But the Bekaa Valley -- we hit that with the New Jersey and with our aircraft after the blowing-up of the Marine barracks.

MR. MCLAUGHLIN: Mm-hmm. We haven't heard anything so far about getting those Syrian troops out.

Eleanor, what do you make of this?

MS. CLIFT: Well, I think they backed off some of the more belligerent rhetoric by the end of the week.

But they don't have to do a lot of saber-rattling, and the Syrians saw what happened in Iraq. Syria could not stand up to Iraq, and they saw Iraq crumble in -- the regime there crumble in three weeks. And U.S. troops are going to be in that region for the foreseeable future.

So the sword is over their head, and I think they're scared. And I think they are going to respond. We're already beginning to see some response. And the administration's going to tighten the political and economic screws, appropriately. And the invasion in Iraq was in large part about demonstrating to that part of the world the might of America, and I think a state like Syria gets the message.

MR. MCLAUGHLIN: Syria has said it will not allow arms inspections in Syria unless those arms inspections are conducted throughout all the Middle Eastern countries, including Israel.


MR. MCLAUGHLIN: Is that going to go anywhere?

MR. BLANKLEY: No, that is a rather obvious red herring.

MR. MCLAUGHLIN: What is? That the --

MR. BLANKLEY: The -- just the attempt to get at Israel's nuclear weapons. There are what, 6 million Jews, and there are 250 million Arabs. Obviously, we are not going to be a party to disarming Israel from that.

But let me go back to the Syrian point, because I'm not quite as convinced as everyone else that if the president wanted to, he could be blocked from going to war. After all, Senator Graham, the democratic senator from Florida, running, probably, for president, the former chairman of the Intelligence Committee, came out promptly for war with Syria to give a bipartisan -- as Pat mentioned -- a bipartisan vote in Congress for the Syrian Act, which is not war, but there's a lot of hostility up in Congress for Syria. Syria is the linchpin -- the remaining linchpin of terrorism that has to be fixed one way or the other if we're going to get to the point where we can lean on Israel to agree. Until we can pull back the terrorism, we don't get to that point. So, Syria's got to either change its conduct promptly, or we have to do something about it. Obviously, diplomacy and economics are possible, but war if necessary.

MR. MCLAUGHLIN: Senator Graham's move in this direction is quite a mystery. Is there any political explanation? He's running for president, he has a very large Jewish-American constituency in Florida. Is that part of this? I mean, it's so out of character for him, is it not? Particularly in view of the fact that he voted against the resolution in Congress giving the president the military aid that he wanted.

MR. ZUCKERMAN: Well, no doubt there's politics in almost everything that goes on -- (chuckling) -- for somebody who's a candidate for the nomination. But look, Syria is really a terrible country in terms of husbanding, headquartering all of the terrorist groups in that part of the world. There are 29 different terrorist groups who have their headquarters in Damascus, in addition to what they have in the way of training camps in the Bekaa Valley. And Bashar Assad, the son, somehow or the other, almost unaccountably starts really visibly to support Iraq as the titanic called Iraq is going under water. People do not understand what he was doing.

MR. MCLAUGHLIN: Well, how did he do that?

MR. ZUCKERMAN: Well, number one -- both rhetorically, right -- using Syria as a conduit for a number of Arab Fedayeen fighters to go into Iraq to go after American forces. They believe he is also being accepting, certainly, the families of a lot of the leadership from Iraq, if not the Iraqis. I mean, the Iraqi ambassador to the U.N. just left; he says, "I'm going to Damascus." So, I mean -- (laughter) -- this isn't the casual stop on the way to wherever.

MR. BUCHANAN: Where would you go? (Laughs, laughter.)

MR. ZUCKERMAN: This is right. This isn't, you know, on the road to -- this was not a conversion on the road to Damascus. (Laughter.) So, Syria is really a critical --

MR. MCLAUGHLIN: You know --

MR. ZUCKERMAN: -- there's a critical opportunity here, a really serious opportunity to force Syria, under the -- given the fact that you say they're in the cross hairs, to really be more responsive to the whole Middle East peace process.

MR. MCLAUGHLIN: Hafez al-Assad, who is the father of the President Bashar Assad --


MR. MCLAUGHLIN: -- his father was a dedicated, and continuing and strong enemy of Saddam Hussein.

MR. ZUCKERMAN: Right. Right.

MR. MCLAUGHLIN: You know that. And for eight years, he was on the side of Iran in the Iran-Iraq War.


MR. MCLAUGHLIN: There is a continuing hatred between the two countries. What conflicts with this is the sense in Syria that Syria is the center of Arabism, and Arabs should be respected here. That may be part of this. But certainly, Bashar is no Saddam Hussein. And this kind of talk, you must realize, has no foundation in fact. That is, there's no plan in the State Department or in the United States government to go into Syria at all.

MR. BUCHANAN: But, John --

MR. ZUCKERMAN: I agree. But the fact that you put pressure on them may help in terms of what we want to accomplish and --

MR. MCLAUGHLIN: Well, he is restraining --

MR. ZUCKERMAN: -- wait a minute, wait a minute --

MR. MCLAUGHLIN: -- he is restraining the Hezbollah, true or false?

MR. ZUCKERMAN: He is not restraining the Hezbollah.

MR. MCLAUGHLIN: That is not my information.

MR. ZUCKERMAN: He is not -- yeah, I mean, I've got to tell you, this is something I know a great deal about. He speaks to Nasrallah, who's the head of Hezbollah, virtually every day. He calls him, "my brother." He's helping him in every --

MR. MCLAUGHLIN: And he restrains him! And he restrains Nasrallah.

MR. ZUCKERMAN: He has not -- Nasrallah restrained himself, because he knew the United States would --

(Cross talk.)

MR. BUCHANAN: John, John, let's go back to Senator Graham --

MR. ZUCKERMAN: Bashar is the guy who doesn't understand what the red line -- (word inaudible) -- that the father understood.

MR. MCLAUGHLIN: All right, we better get out.

MR. BUCHANAN: Do you know where Graham -- do you know where Senator Graham made his statement, John? At the Miami-Dade Synagogue. That will tell you what Senator Graham is up to talking about cruise missiles on Syria!

MR. MCLAUGHLIN: Do you agree that it's out of character for Graham?


MR. BUCHANAN: This is -- usually, in pandering in election year, you say, "Let's move the capital from Tel Aviv to Jerusalem." Now you say, "Let's throw some cruise missiles at Syria."

(Cross talk.)

MR. MCLAUGHLIN: Exit question: Syria has called for a ban on all weapons of mass destruction in the Middle East. Syria has called for the ban. Should the U.S. back this resolution? Yes or no?

MR. BUCHANAN: John, it would be a good idea, but it is one of the great nonstarters of all time! (Laughs.) It's not going to take: "Go down to Dimona and get those nuclear weapons."

MR. MCLAUGHLIN: Is it a piece of political wizardry on the Syrians' part?

MR. BUCHANAN: It is a good piece of propaganda --

MR. MCLAUGHLIN: What is the problem for the United States in backing such a wholesome ban?

MR. BUCHANAN: You cannot -- Tony's right; you cannot tell the Israelis they've got to give up the weapon that is their only deterrent to an Arab army coming from Egypt in the future, say, of about 500,000 men.

MR. MCLAUGHLIN: You know how well this idea goes over with the Arabs, however?

MR. BUCHANAN: Oh, I know that.

MR. MCLAUGHLIN: And how they see more graphically what's in play.

MR. BUCHANAN: It is an excellent point.


MS. CLIFT: Well, Secretary of State Powell was asked about that, and he actually danced around it and basically said in a perfect world, we'd love to sign on to that. And maybe we'll get there someday. But I agree. It's a nonstarter ban.

MR. MCLAUGHLIN: I know it's a nonstarter.

MS. CLIFT: It's a nonstarter. (Laughs.)

MR. MCLAUGHLIN: But should the United States support it?

MS. CLIFT: No, because it would rupture relationships with Israel, our primary ally in the area.

MR. MCLAUGHLIN: Well, there you said the whole thing. You said the whole thing. That's exactly the point they wish to dramatize.

MR. BLANKLEY: Yeah. Israel needs that for the same reason we needed nuclear weapons against the Soviet army during the Cold War. It's (an) equalizer, if necessary. And no, it's a bad idea, and it's not going to happen.

MR. ZUCKERMAN: Yeah. By the way, you know, Syria also proposed the United States should abandon all its conventional and nonconventional military means before they sit down with Syria. It's equally preposterous. It's just a political cover for them to avoid doing what we want them to do.

MR. MCLAUGHLIN: Well, it's something more than that. Syria wants to call to the world's attention yet again the disparity that exists.


MR. MCLAUGHLIN: But it's not going to go anywhere.

When we come back, does President Bush have the stomach to press Ariel Sharon as hard as he will need to in order to achieve a Middle East peace road map breakthrough?


MR. MCLAUGHLIN: Issue two: Is Sharon giving ground?

"Very painful concessions." That's what Israeli Prime Minister Ariel Sharon says he will make to establish peace in the Middle East. "Very painful concessions." It's a phrase Sharon has used before -- in his election campaign two years ago -- but this time around may be different. The lightening-quick U.S. victory in Iraq has sent shock waves through the Middle East which Sharon says means, quote, "A chance to reach an Israeli-Palestinian agreement faster than people think," unquote.

Still, Israelis are trying to puzzle out the Delphic language of "very painful concessions." Asked point blank by the Israeli newspaper Ha'aretz if "painful concessions" was a hollow phrase, Sharon shot back, "Definitely not. It comes from the depth of my soul. We are talking about the cradle of the Jewish people.

Our whole history is bound up with these places -- Bethlehem, Shiloh, Beit El -- and I know that we will have to part with some of these places. As a Jew, this agonizes me. I have decided to make every effort to reach a settlement. I feel that the rational necessity to reach a settlement is overcoming my feelings," unquote.

Still, Sharon is not ready to concede all. He continues to maintain that settlement activity will not halt until the "final stage" of the peace talks. This conflicts with the road map proposed by the Quartet -- Russia, the European Union, the United Nations and the U.S. The road map calls for a freeze in settlements now -- not at the final stage, but now. So that will have to be ironed out.

Palestinians are skeptical.

NABIL ABU RUDEINEH (Arafat advisor): (From videotape.) He's trying to avoid accepting an approval of a road map which has been accepted by everybody, including the Palestinians.

MR. MCLAUGHLIN: And Yasser Arafat has been holding up the process, by moving grudgingly on the approval of the new Cabinet of Abu Mazen, the new Palestinian prime minister. Mazen has until April 24 to get his Cabinet in place. Otherwise, the Quartet road map won't be released.

Question: Mort, talk to us about the resistance on the part of Arafat to the Mazen Cabinet.

MR. ZUCKERMAN: Well, Arafat, in the so-called new constitution, which, in a sense, the Palestinians have developed under American pressure, still retains the control of the security forces, the peace negotiations, the intelligence services. And he has been unwilling to allow Abu Mazen to appoint the minister of Interior, who will be responsible to Abu Mazen, rather than responsible to Arafat. And that is the key issue, because if the security issue isn't resolved, there will be no progress on the peace process.

MR. MCLAUGHLIN: Hold on. Let's put up on the screen the security minister who Mazen wants. His name is Dahlan.

MR. ZUCKERMAN: Mohammed Dahlan. Mohammed Dahlan.

MR. MCLAUGHLIN: Dahlan. Mohammed Dahlan. There you see him on the screen. He gets on with --

MR. ZUCKERMAN: He's the one on the -- yeah --

MR. MCLAUGHLIN: In the light suit. He gets on with Sharon, and he gets on with George Tenet. And he is -- and Mazen is insistent that he have his own team.

MR. ZUCKERMAN: That's right.

MR. MCLAUGHLIN: Now Arafat is cornered, and he's very vulnerable. Will he yield on Dahlan?

MR. ZUCKERMAN: I think he may yield on Dahlan, because he has no choice. But Dahlan and Arafat have had a falling-out. Dahlan was in charge of the security forces in Gaza. Since the Israelis didn't go into Gaza, as a practical matter, he still has a lot of troops on the ground, which is the one thing that Abu Mazen lacks. For Abu Mazen to be effective within the Palestinians, he has to have troops on the ground, and Dahlan is his only, only opportunity for that. And Arafat knows it. Arafat does not want to be marginalized. That's why he's trying to fight it.

MR. BUCHANAN: John, let's move this ball forward. The key thing is the settlements. If the president of the United States is unwilling to tell Ariel Sharon, "Stop building settlements now," period, as soon as he announces that road map -- if he's not willing to do that, this is going nowhere.

MS. CLIFT: Well, we don't --

MR. ZUCKERMAN: Well, that is -- I couldn't disagree with you more strongly. What the president has said is that the thing that --

MR. BUCHANAN: Well, I know what he's said, but this is the key --

MR. ZUCKERMAN: Well, the key is to -- stopping the terrorism, not the settlements --

MR. BUCHANAN: The cause of the war is not terrorism.

MR. ZUCKERMAN: The settlements issue --

MR. MCLAUGHLIN: Let Mort -- Pat, let Mort finish.

MR. ZUCKERMAN: The settlement issue in fact was worked out fairly easily at the Camp David talks. The terrorism was not. They did not stop the terrorism. They haven't stopped the terrorism since Oslo. Everything is preconditioned on the stopping of the -- cessation of the --

MR. BUCHANAN: Look, Mort -- Mort, you know, the terrorism started -- this --

MR. ZUCKERMAN: And here Sharon himself has said, "We will pull back from the settlement" --

MR. MCLAUGHLIN: The question I want --

MR. BUCHANAN: The terrorism started when Sharon marched up on the Temple Mount. That's when the whole thing started.

Look, John, the cause of the war -- terrorism is what takes place in war. The cause of the war is the disposition of the Palestinian people, the theft of their land, the removal of them from where their fathers have lived a thousand years. Until that is dealt with, there is no solution to this problem.

MS. CLIFT: Well, these two sides --

MR. MCLAUGHLIN: I want to ask you --

MS. CLIFT: The two sides here capsulize why the Israelis and the Palestinians haven't been able to get together. He says stop the terrorism, you say stop settlements. And nobody --

MR. BUCHANAN: I agree, stop the terrorism.

MS. CLIFT: Yeah, but you can't stop --

MR. BUCHANAN: Sharon's got every right to say stop it or we don't negotiate.

MS. CLIFT: You can't stop it -- you can't stop it overnight.

MR. MCLAUGHLIN: Eleanor, what's your point?

MS. CLIFT: The administration is as divided as these two. And you have Colin Powell on one track, and then he's got a bunch of minders around him, basically the neocons, who have taken over foreign policy. And I'm very skeptical --

MR. MCLAUGHLIN: Well, Colin Powell and Rice are now together on the need for there to be movement here with regard to --

MS. CLIFT: Yes, but you've got Elliott Abrams and Douglas Feith --

MR. MCLAUGHLIN: -- with regard to Dahlan, and with regard to Mazen, and with regard to the question of how do we handle Sharon, because Sharon now is opposed to freezing the settlements now --

MR. BUCHANAN: Where is the --

MR. BLANKLEY: Let me -- let me -- let me get one --

MR. MCLAUGHLIN: -- and he's also opposed to the right of any return.

Now, the question is --

MS. CLIFT: They've got three minders watching him.

MR. MCLAUGHLIN: -- is he trying to strangle the baby in the crib?

MR. BLANKLEY: John, let me get one --

MR. MCLAUGHLIN: But I don't think he is any longer.

MR. BLANKLEY: Let me get one thought in here.

George Walker Bush is not a neocon. I don't think he is going to be persuaded by the ideology. I think he's a pragmatist. I think he sees a moment now to force a peace, and he's going to lean very heavily on Sharon, promptly; he's leaning very heavily on Syria, and he's going to lean heavily on Egypt and Saudi Arabia to put pressure on Arafat --

MR. BUCHANAN: Good for him.

MR. MCLAUGHLIN: But does he have a sentimental view of Israel --


MR. MCLAUGHLIN: -- regarding it as a tough and plucky country?


MR. BUCHANAN: Yes, he does.

MR. MCLAUGHLIN: And is that going to interfere with the pressure that he has to bring in order to satisfy his two allies in the war, namely, Spain and Blair? He owes it to them to advance this forward, and he's got a very difficult time weighing these in the balance. True or false?

MR. ZUCKERMAN: You know, I agree, that is exactly the issue. He does have -- but I do agree with what Tony was saying. I think Bush's approach to policy is not an ideology based on the neocons. I think he has a sense here of something moral about fighting terrorism. And being the object of a huge terrorist campaign that's gone on for a long, long time, that's where he identifies with Israel.

MS. CLIFT: Yeah, but your -- but your --

MR. MCLAUGHLIN: Do you think -- do you think --

MS. CLIFT: -- your definition of "moral" does not include the leaning on Sharon that many other people envision.

MR. ZUCKERMAN: I agree. I have a -- (inaudible) --

MS. CLIFT: Right.

MR. MCLAUGHLIN: Do you think there's going to be a -- do you think there's going to be a major initiative and push on the part of the administration, or is their realization that the Palestinians are not ready and the Israelis are not willing?

MR. ZUCKERMAN: No, I think they know what the Israelis are willing to do. And you and I have talked about this in the past. Sharon is willing to go a lot farther, providing he has a partner. The question is, will Abu Mazen be a partner?

MR. BUCHANAN: Oh, for heaven's sakes!

MR. ZUCKERMAN: Everybody knows that Arafat is not a partner. Arafat has lied, and every single document he's signed --

MR. BUCHANAN: You know --

MR. MCLAUGHLIN: Oh, I think you're going to find that Mazen will be a partner.

MR. BUCHANAN: You know, this is --

MR. ZUCKERMAN: If he is, then there will be -- and that's what Sharon has said, and that's what the administration believes.

MR. MCLAUGHLIN: All right.

MR. BUCHANAN: You know, John, this is preposterous. You've got four Israeli prime ministers have shaken hands, negotiated with Arafat. Two of them shared a Nobel Prize with him. Sharon doesn't want to negotiate because he doesn't want to negotiate with anyone.

MR. MCLAUGHLIN: Well, I don't know about that. I don't know about that. I used to think that way, but I'm not so sure anymore.

MR. BUCHANAN: I know. You get changed about every three weeks, John! (Laughs.)

MR. MCLAUGHLIN: Exit: When will the road map be published?

Pat Buchanan.

MR. BUCHANAN: It may not be this week, but I think --

MR. MCLAUGHLIN: Just give me a date, Pat, will you?

MR. BUCHANAN: Okay. I said by May 1st, by May 1st.



MS. CLIFT: Oh, spring! (Laughs.)

MR. BLANKLEY: I don't have any insight into that.

MR. MCLAUGHLIN: No insight at all.


MR. MCLAUGHLIN: You're letting us down again, Tony.

MR. ZUCKERMAN: They will publish the road map within the next several weeks, but the road map still requires comments to come back from both sides.

So the -- it's not a final draft that is going to be published.

MR. MCLAUGHLIN: Yeah. Well, the answer Cinco de Mayo, the 5th of May. (Laughter.)

Issue three: It's the economy, suddenly.

PRESIDENT GEORGE W. BUSH: (From videotape.) Instead of lowering taxes little by little, the Congress should do it all at once and give our economy the boost it needs.

MR. MCLAUGHLIN: In a swift maneuver, President Bush shifted his focus from the foreign to the domestic front this week, and repeated his call for a massive tax cut. Seven hundred and twenty-six billion dollars over 10 years is the cut he originally wanted, but now he says he will settle for less. He'll settle for the $550 billion package of the Republican House of Representatives. The Senate voted to scale it back to 350 billion, but the final numbers have yet to be hammered out in conference.

Bush says a tax cut will stimulate the economy that continues to sputter.

Item: Red ink rises, with the deficit projected to reach $1.82 trillion over the next decade -- this year alone, expected to be $400 billion.

Item: New jobless claims up by 30,000. In February and in March, 500,000 jobs were lost.

Item: Factory orders drop 1.5 percent in February, the most in five months.

Item: Corporate CEOs paralyzed.

MARK ZANDI (economist): (From videotape.) They're not hiring. They're not investing. They're not advertising. They're not traveling.

MR. MCLAUGHLIN: Item: 401(k)s sink from $50,000 in '99 to $45,000, on average, in '02, mostly due to devalued stock. Big employers like Prudential, Ford and Goodyear are currently not matching employee contributions.

But hold on. There's good news.

Item: Housing starts up a robust 8.3 percent in March, thanks to low interest rates, with 30-year fixed mortgages in mid-March at 5.6 percent.

Item: Consumer Price Index up, but only .3 percent since February, meaning that inflation is still very low.

Will we see a quick rebound now that the worst of the fighting in Iraq is over? I ask you, Mort.

MR. ZUCKERMAN: No, I don't think we will. I think the fundamental problems of the economy -- the problems of the economy that came from the bubble of the 1990s are still with us. We have a huge deficit. We have a huge trade deficit. We have a very, very weak investment program nationally. We were down in investment. Exports are down. We have a lot of problems with this economy. It's going to take a long time to pull out of it. And Bush's tax program is going to have the most marginal effect.

MS. CLIFT: Right.

MR. MCLAUGHLIN: You're talking years?

MR. ZUCKERMAN: I'm talking another year to two years at least.

MR. MCLAUGHLIN: Because of --

MR. ZUCKERMAN: And we've been through two and a half years --

MR. MCLAUGHLIN: This is the hangover from the economy bubble of last year.

MR. ZUCKERMAN: That's right.


MS. CLIFT: Yeah. Bush has the politics right. He's got to show that he cares about the economy and he's paying attention.


MS. CLIFT: But he's got the policies all wrong.


MR. BUCHANAN: I think Eleanor's got a very good point. Bush has got to show he's fighting to get this tax cut. That will start things off. He's got to stay with it and make himself a good political --

MR. MCLAUGHLIN: He's not going to get that tax cut.

MR. BUCHANAN: And I agree with Mort --

MR. MCLAUGHLIN: He's not going to get 550 billion.

MS. CLIFT: (Inaudible.)

MR. BUCHANAN: He's going to get 450 --

MR. ZUCKERMAN: No, he won't. No, he won't.

MR. MCLAUGHLIN: Does it make any difference? No, because it won't have any effect on the economy.

MR. BUCHANAN: Oh, I think it --

MR. MCLAUGHLIN: This is all a matter of perception, Pat. You know that. He wants to show himself as engaged with the people on the economic level.

MR. BUCHANAN: Things perceived as real are real in their consequences, John.

MR. MCLAUGHLIN: Will the same thing happen to Bush as happened to his father, namely, that even -- even his father was experiencing a recovery at the time he lost the election --

MR. BLANKLEY: Yeah. A jobless recovery.

MR. MCLAUGHLIN: -- after the triumph of the war?

MR. BLANKLEY: I don't think it's going to. It could, but I don't think the conditions are the same. September 11th is different than the Persian Gulf War. Bush is much more engaged in a public way on the economy.

MR. MCLAUGHLIN: Furthermore --

MR. BLANKLEY: The best thing for Bush would be if he didn't get his tax cut, then he could blame the Democrats.


MR. MCLAUGHLIN: It will not happen to Bush, Junior, what happened to Bush, Senior. We're all agreed on that?

MS. CLIFT: No, we're not all agreed. (Laughter.)

MR. MCLAUGHLIN: We're not all agreed on that?

MS. CLIFT: Eight million people out of --

MR. MCLAUGHLIN: I'll agree on that --

MS. CLIFT: Eight million people out of work. The stock market losses that rival --

MR. MCLAUGHLIN: -- because Karl Rove is not John Sununu.

We'll be right back with predictions.


MR. MCLAUGHLIN: Predictions.


MR. BUCHANAN: There's going to be a strong new president for the European Union five-year term. Tony Blair will run for it in 2006. But to get the presidency, he's going to have to run through a referendum and give up the pound, a bloody battle coming in our friend's country here -- (referring to Tony Blankley) -- (laughs, laughter) -- in our country between Tories and Labour, and I'm not going to be on Blair's side on this one.

MR. MCLAUGHLIN: Eleanor, can you unscramble those eggs?

MS. CLIFT: No! (Laughs, laughter.)


MS. CLIFT: The Bush administration will continue Saddam Hussein's policy of not letting U.N. weapons inspectors into Iraq.


MR. BLANKLEY: Senator Hollings will announce that he's not going to run for reelection.


MR. ZUCKERMAN: If the Republicans don't get together with the Democrats on the tax program, whatever tax program gets passed will be passed too late to really affect the economy in 2004.

MR. MCLAUGHLIN: I predict that Mitch Daniels, the current director of the powerful Office of Management and Budget, will quit his job. He will run for governor in Indiana. Daniels also will be replaced at OMB by Clay Johnson.

Happy Easter and happy Passover weekend. Bye-bye.


MR. MCLAUGHLIN: Issue four: Return to sender.

The regime of Saddam Hussein has been crushed. Al Qaeda is on the run. The homeland security alert has been lowered to yellow. But a new enemy lurks on the American horizon. Not Syria. Not Iran. But spam. That's right, spam. That's the techie jargon that refers to the unsolicited commercial e-mails that people get in their computers. Spammers are like telemarketers, only instead of riding the phone lines into people's homes, spammers ride the Internet. Sales pitches for everything from get-rich-quick schemes, cure-all elixirs, estate planning counsel, porno ads. Of all e-mail traffic in the United States, spam makes up 40 percent of it.

It's not just annoying, it's also expensive. To block spam, U.S. corporations spend about -- get this -- $10 billion annually. But the anti-spam revolt has finally begun. This week, America Online filed lawsuits seeking damages from spammers. After getting 8 million complaints about spam from their 27 million customers, AOL is taking legal action. And both the U.S. Senate and the House are getting into the act with anti-spam legislation.

Question: Why are consumers up in arms about spam and silent about cookies?

I ask you, Tony. What are cookies?

MR. BLANKLEY: Cookies, as I understand it, are the ability to track each Internet site you go to, and then they know and then they can sell that information to whoever would be interested in knowing that -- (inaudible) --

MR. MCLAUGHLIN: They're secretly planted in the computer.


MR. MCLAUGHLIN: And they function to track your every move, correct?


MR. MCLAUGHLIN: It would be like the Post Office being able to know what letters you receive, Tony, and what letters you send out --

MR. BLANKLEY: Yeah, I understand that.

MR. MCLAUGHLIN: -- and tracking that and making that known to a marketer who will then use it. Or a library knowing what books you remove and how long you keep them, what pages maybe you linger on.


MR. MCLAUGHLIN: Or what else? A phone company keeping regards of whom you talk to, Mort, and how long you're on the phone.

MR. BLANKLEY: But to answer your question, the reason why people don't care about cookies is because they're invisible and spam is visible and irritating.

MR. MCLAUGHLIN: Well, now -- but nevertheless, spam is passive and the cookies are active; they're reporting on you. They're watching your ever move; they're feeding it back to marketers, and they're feeding it back for spammers to spam.

MS. CLIFT: Actually, there is legislation in the works, and people are concerned about the privacy violations of cookies. So, before people even realize they're there, they're probably going to get taken care of. I have faith in our government, government regulation, and also technology. I think we're all going to have a way to install in our computers killers of spam.

MR. MCLAUGHLIN: Pat, is this a good argument against modernity and change -- change should be outlawed?

MR. BUCHANAN: You can delete spam and you can delete this issue. (Laughs.)

MR. MCLAUGHLIN: Well, are you satisfied with your typewriter?

MR. BUCHANAN: No, I click 'em all off. I get rid of 'em. I'm concerned about the cookies, now that you mentioned 'em. I didn't know they existed! (Laughs.)

MR. MCLAUGHLIN: Well, you better check it out because they can feed them in, even though it's not on your computer.

MR. BUCHANAN: Good heavens! I am in trouble now! (Laughs.)