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THE MCLAUGHLIN GROUP

HOST: JOHN MCLAUGHLIN

PANEL:
PATRICK BUCHANAN, ELEANOR CLIFT, TONY BLANKLEY, MORT ZUCKERMAN

DATE: FRIDAY, AUGUST 13, 2004

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THIS IS A RUSH TRANSCRIPT.
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MR. MCLAUGHLIN: Issue one: Iraq on the brink.

IYAD ALLAWI (IRAQI PRIME MINISTER): (From videotape.) They should dismantle their military. They should lay down their arms.

MR. MCLAUGHLIN: Iraqi Prime Minister Iyad Allawi's message to radical Shiite cleric Muqtada al-Sadr and his Madi army in the holy city of Najaf this week went ignored. Extensive violence first flared and then
spread, with more than 350 Iraqis killed. The American-led operations authorized by Allawi against Najaf and its holy sites sparked murderous fighting throughout Iraq; 70 killed in the city of Kut, and Sadr City, Baghdad and Basra also saw much bloodshed.

The bloody Najaf showdown with Muqtada al-Sadr is being questioned nationally in Iraq and internationally, notably Iran. Ibraham Jafari, one of Iraq's two vice presidents, thinks it's a bad idea, as opposed, of course, to Allawi, who ordered it. Jafari, by the way, leads the opinion polls in Iraq as the nation's most popular politician. "I call for multinational forces to leave Najaf and for only Iraqi forces to remain
there. Iraqi forces can administer Najaf to end this phenomenon of violence in this city that is holy to all Muslims." Al Jazeera ran Jafari's statement.

Pat Buchanan, is the assault on Najaf, including the bombing of al-Sadr's residence, as we see it here, a good call or a bad call?

MR. BUCHANAN: It is a necessary call, John. Allawi tried to bring al-Sadr into the process by offering virtual amnesty to him. We have left them alone. They continue to do battle. What you've got now is a strategic sanctuary in Fallujah and one in Najaf. And Allawi's made this tough call, and the Americans agree with it. They're going to take the risks attendant to it and go in and finish this guy off. I think, militarily and strategically, it is a tremendously risky decision. I think
it's a necessary decision and the right decision.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I think it's a huge mistake. I think this is the equivalent of Vatican City. You may win the battle, but you lose the war for generations. And Allawi talks tough. He's taken it this far. It's not at all clear that he's going to take it to the temple. And Allawi and the U.S. forces are inseparable. He is seen as our puppet. He is our puppet.

MR. MCLAUGHLIN: Who called this shot?

MS. CLIFT: Who calls the shots?

MR. MCLAUGHLIN: Who called this shot? You think the Americans did?

MS. CLIFT: I think the Americans are behind this. I don't think Allawi would do anything without American consultation and consent. And so if that temple is damaged in any way, tanks roll across that cemetery, it's the U.S. that's going to take the heat for it for a long time to come.

MR. MCLAUGHLIN: Did you notice that the Ayatollah Ali Sistani left Iraq on Friday?

MR. BLANKLEY: Heart condition.

MR. MCLAUGHLIN: Yeah, heart condition. He went to London.

MR. BLANKLEY: Good place to go.

MR. MCLAUGHLIN: So he's out of town both for the lightning visit of Allawi into Najaf, his personal visit, and secondly, for all of this. Now, does that fit into your analysis?

MR. BLANKLEY: It's an amazing coincidence, of course.

MR. MCLAUGHLIN: You think it's a coincidence? You think that he doesn't want to be there because he does not want to stop this, or he doesn't want to be there because he doesn't want anyone to ask him questions
about it?

MR. BLANKLEY: I don't know. But obviously one could suspect that he wanted to be out of country when this was going on. He made statements that while saying we have to be careful about the sacred sites, he didn't tell them to stop doing it. I think that was sort of like at least
a yellow if not a green light to go ahead, and as Pat says, necessarily get this job done here; not only here, but also in Fallujah against the Sunni uprising. If they don't put down those two sites of rebellion, then this whole process can't go on towards a peaceful Iraq. And the sooner they get it done, the better.

MR. MCLAUGHLIN: You think this is a bad time, that this could lead to immense unintended consequences, because the closer they get to the mosque and the destruction of the mosque, it's already inflaming so many cities throughout Iraq. Is this a wise move?

MR. ZUCKERMAN: Well, we're going to be able to determine if it's a wise move by the outcome. Alas, that's the only way we're going to know. But let me just tell you, there's one thing going on here that is not being mentioned. Iran is very heavily involved in all of this aspect of the Shiite uprising. And it's one of the reasons why Sistani hasn't said anything, because he is opposed to Muqtada al-Sadr, and he is opposed to his forces.

So you have, in a sense, a division within the Shiite community. And the Shiite community that is represented by Sadr is the Shiite community that is being fed out of Iran. And that is one of the reasons why
both the United States and Allawi are working to get this guy out and
over with.

MR. MCLAUGHLIN: What do you say about the division within the government of Allawi, namely Jafari taking the position that this is a bad idea? And he's one of the two vice presidents.

MR. ZUCKERMAN: Well, there's bound to be differences. You have a whole range of interests in that government, including different sects within the Sunni religion and the Shiites. But the key thing is -- and that's one of the reasons why the United States insisted that Allawi end up as the prime minister --

MR. MCLAUGHLIN: The bloodshed this week has been enormous.

MR. BUCHANAN: There's tremendous risks attendant. Eleanor's right. There's no doubt about it. It's a great risk. This could explode. You could lose the Shi'as. But Tony is right in this sense. If you do not eliminate these two sanctuaries, Fallujah and Najaf, you are going to lose the war. That is what they're playing with right now, and they've rolled the dice. And, no, we don't know how it's going to come out.

MS. CLIFT: But it's going to lose the war for the hearts and the minds, and we are going to create so much anti-American sentiment --

MR. MCLAUGHLIN: Do you think --

MR. BLANKLEY: The Arab street --

MS. CLIFT: Excuse me. Excuse me. The original sin was shutting down that fellow's newspaper. He was a relatively marginal cleric. The Shiites would have taken care of him himself. We have gone in there and
emboldened him and made him a much larger figure with --

MR. BLANKLEY: Look, I agree with you regarding closing it down. That was foolish. But we hear every month or two for years the Arab street is about to explode if we don't do X, Y and Z. Sometimes it explodes.
Usually it doesn't. And I think this is sort of a crying wolf too often. I think it's a chance worth taking.

MR. MCLAUGHLIN: You know, when --

MS. CLIFT: We're talking about Arab mosques.

MR. MCLAUGHLIN: When the newspaper was shut down, that caused the biggest demonstration and the closest thing to an uprising that Iraq has seen. That happened about, what, eight or 10 months ago.

MR. ZUCKERMAN: But it happened when we were the visible face of government. It is a huge difference now that we are no longer the visible face of government. It may be, as Eleanor says, that Allawi is seen as a U.S. puppet. I don't think so. He is seen as a very tough guy with
--

MR. MCLAUGHLIN: Is he seen as a dictator?

MR. ZUCKERMAN: I don't think he's seen as a dictator.

MR. BUCHANAN: He's got to do it, John.

MR. MCLAUGHLIN: You don't?

MR. ZUCKERMAN: No, I do not think he's seen -- he's just seen as a tough leader.

MR. MCLAUGHLIN: I think they see him as a benign dictator, and a lot of them like that.

MR. BUCHANAN: I think he's --

MR. MCLAUGHLIN: Has he won over the middle class in Iraq?

MR. ZUCKERMAN: He's certainly doing a better job than what was going on before. They all know that --

MR. MCLAUGHLIN: Do you think this is a big mistake, however?

MR. ZUCKERMAN: No, I do not think it is a big mistake, because I agree with what Tony was saying and what --

MR. MCLAUGHLIN: Well, I think it's a mistake.

MR. ZUCKERMAN: Well, you may be right.

MR. MCLAUGHLIN: I think it's a strategic mistake. I think the best thing he did was go around and personally visit the Syrians, the Syrian head of state, the head of state in Cairo, the head of state in Kuwait.

MR. BUCHANAN: John, he offered --

MR. MCLAUGHLIN: That was brilliant. It was something Bremer never did.

MR. BUCHANAN: He offered these guys an amnesty. He gave them every opportunity. And Sadr said no because Sadr wants power. It is Sadr or Allawi, and Allawi knows it. He's made the call. I think it's probably the right thing. It could explode.

MS. CLIFT: He didn't offer Sadr amnesty.

MR. BUCHANAN: He certainly did.

MS. CLIFT: I don't believe --

MR. BUCHANAN: Look, he said, "Come into the political process. Lay down your arms."

MR. MCLAUGHLIN: What else did he do that you like about Allawi? He restored capital punishment. You obviously like that.

MR. BUCHANAN: Look, John, they need -- if you're going to have a unified Iraq, you're going to have to have a tough customer --

MR. MCLAUGHLIN: He shut down --

MR. BUCHANAN: The idea that this is going to be some kind of open free-form democracy is preposterous.

MR. MCLAUGHLIN: He shut down Al Jazeera for a month. Do you think that was --

MR. BUCHANAN: (Inaudible.)

MR. MCLAUGHLIN: Or do you think the Americans agreed?

MR. BUCHANAN: They both agreed.

MS. CLIFT: You know what this reminds me of? "He's a dictator, but he's our dictator."

MR. MCLAUGHLIN: Right. It did look like he's -- the Americans and Allawi and his government are ganging up on the Shiites.

MR. BLANKLEY: Let me make a point. Let me get past the clich‚. He is doing nothing more authoritarian than Winston Churchill did in England during World War II or than Roosevelt did in America during World War II. Any time you've got war going on, you're going to have a tougher regime than otherwise. But to call him a dictator simply because he's closing down the --

MS. CLIFT: He has dictatorial tendencies, and everybody would agree with that. And I thought we had a peace going on in Iraq.

MR. MCLAUGHLIN: Let's get out.

MR. ZUCKERMAN: We don't have peace there. Look what's going on.

MS. CLIFT: I thought --

MR. ZUCKERMAN: We cannot have a government --

MS. CLIFT: We're bringing democracy. We don't bring --

MR. MCLAUGHLIN: Rate Allawi on a scale of -- on an alphabetical scale, A through F; his performance thus far in the last six weeks. A to F.

MR. BUCHANAN: I mean, is A high?

MR. MCLAUGHLIN: Yeah, A's high. What do you think, F is high?

MR. BUCHANAN: (Laughs.)

MR. MCLAUGHLIN: What do they teach you at Georgetown?

MR. BUCHANAN: (Laughs.) Okay, I think -- I would give Allawi, frankly, so far --- I'd give him a B+.

MR. MCLAUGHLIN: What do you give him, Eleanor?

MS. CLIFT: I'd give him a C, but I think he started something that he can't finish here.

MR. MCLAUGHLIN: You think C is high.

MS. CLIFT: I think C is relatively high, but he started something I'm not sure he can finish. And if he finishes it --

MR. MCLAUGHLIN: Okay, she says his political tide is going down. What do you think? Quickly.

MR. BLANKLEY: Obviously it's incomplete. But after half a semester, I'd give him an A in the first quarter.

MR. MCLAUGHLIN: What do you give him?

MR. ZUCKERMAN: I'd give him an A-, I mean, although, as you say, the written test is to come. (Laughter.)

MR. MCLAUGHLIN: I'll give him an A-. And I would have given him an A except for this, and I think this is a bad turn. But we'll see.

Okay, the human toll: U.S. military dead in Iraq, 932; U.S. military evacuations, 25,700; Iraqi civilian dead, 19,100. Another exit question: Why is Allawi just the kind of authoritarian leader Iraq needs in this interim period? Pat Buchanan, we somewhat discussed that. Can you add to what you said?

MR. BUCHANAN: Yeah. I think the decisive question is whether Najaf and Fallujah are pacified and brought under the control of --

MR. MCLAUGHLIN: What's the answer?

MR. BUCHANAN: If they're not brought under the control --

MR. MCLAUGHLIN: Well, we know that.

MR. BUCHANAN: The war is going to be lost if it's not --

MR. MCLAUGHLIN: Well, presumably you think he's bringing them under control.

MR. BUCHANAN: No, he has not made the call on Fallujah and he's not made the final call, I think, on Najaf.

MR. MCLAUGHLIN: Would you call him the Arab Putin?

MR. BUCHANAN: I think that's an excellent analogy, John.

MR. MCLAUGHLIN: Thank you, Pat.

MR. BUCHANAN: All right. (Laughs.)

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Whatever he does will be inseparable from the United States. We are still the face of the occupation.

MR. MCLAUGHLIN: So we're taking the rap, too.

MS. CLIFT: Right.

MR. MCLAUGHLIN: We're ganging up on the Shiites.

MS. CLIFT: Absolutely.

MR. BLANKLEY: Well, I disagree. I think he's got -- I've seen the polling indicating he's got a fair level of credibility. He's --

MR. MCLAUGHLIN: What do you rate him as?

MR. BLANKLEY: I already gave him an A.

MR. MCLAUGHLIN: An A?

MR. BLANKLEY: For the first quarter.

MR. MCLAUGHLIN: Okay. Mort?

MR. ZUCKERMAN: No, I think he's doing the job he has to do. It may not work, but it's the job he has to do. We cannot afford to lose this war.

MR. MCLAUGHLIN: So he's --

MR. ZUCKERMAN: And neither can he.

MR. MCLAUGHLIN: And he has struck the right balance between dictatorial and democratic behavior.

MR. ZUCKERMAN: Well, I wouldn't call it dictatorial, but I'd certainly call it tough-minded. You can't -- it's not a dictatorship there.

MR. MCLAUGHLIN: You think he'll survive.

MR. ZUCKERMAN: He has real --

MR. MCLAUGHLIN: You think he'll survive.

MR. ZUCKERMAN: Look what he's done. He's gone around to try and gather political support. He's gone around to all the tribes. He's gone around to the different communities. This is not just the role of a
dictator. He doesn't have that kind of power.

MR. MCLAUGHLIN: Isn't it true that we installed him? We had Blackwell over there and we had Bremer.

MR. ZUCKERMAN: Yeah.

MR. MCLAUGHLIN: We called that shot.

MR. ZUCKERMAN: Yeah.

MR. MCLAUGHLIN: We spun that Iraqi council right around.

MR. ZUCKERMAN: Yeah, absolutely, because we knew he was a --

MR. MCLAUGHLIN: So he's our guy.

MR. ZUCKERMAN: Yes.

MR. MCLAUGHLIN: Unfortunately, a lot of Iraqis know that, and that works against us.

MR. ZUCKERMAN: I'm sure they do. But they still respect what he's doing now.

MR. MCLAUGHLIN: All right, we'll send you over to Mokhtar and talk to him.

MR. ZUCKERMAN: I will go.

MR. MCLAUGHLIN: When we come back, New Jersey's Governor McGreevey is out. Why now?

(Announcements.)

MR. MCLAUGHLIN: Issue two: McGreevey out.

NEW JERSEY GOVERNOR JIM MCGREEVEY (D): (From videotape.) And so my truth is that I am a gay American. I engaged in an adult consensual affair with another man, which violates my bounds of matrimony.

MR. MCLAUGHLIN: New Jersey Democratic Governor James McGreevey suddenly resigned this week halfway through his first term. A former aide has filed a sexual harassment suit against the governor. Investigators
are looking into whether there is any extortion in the matter.

McGreevey will not officially step aside until November 15th. Mr. McGreevey became governor in 2001. In that election, his Republican opponent was Bret Schundler. He is seeking the Republican nomination again next week. Schundler says that the mortal wound to Democrat McGreevey
was inflicted on him not by Republicans but by a Democratic cabal.

Why did Golan Cipel decide to bring his charges now? Is it because the Democratic bosses who run New Jersey got to him somehow and are using him to clear Jim McGreevey out of the way so they can run Jon Corzine
for governor next year and keep themselves from losing control of the most powerful governor's office in America? First of all, it's not the most powerful governor's office. That's California. That's Arnie, right?

MR. BUCHANAN: That's Arnold.

MR. MCLAUGHLIN: That's Arnold. So what do you think of this idea of Schundler's?

MR. BUCHANAN: There was a Democrat that blew up McGreevey, and his name is McGreevey. This guy has engaged in scandalous and squalid behavior. His administration is full of scandal, John. Over the weekend, the last weekend, this individual Cipel --

MR. MCLAUGHLIN: We're talking about timing. We're not talking about degree of inrectitude.

MR. BUCHANAN: McGreevey moved out early. But you noticed he scheduled his resignation for November 15th. Why, John? Because if he resigns before September 2nd, the election will be this November and you could have the possibility of cleaning out their whole gang.

MR. MCLAUGHLIN: I think Pat is pretty good on this, but I think he misses the point. The point is, if there is a special election before our November 2nd election, the last date --

MR. BUCHANAN: It's got to be November 2nd or --

MR. MCLAUGHLIN: No, you cannot have a special election beyond September 2nd.

MR. BLANKLEY: It has to be called then, but it'll be on November 2nd.

MR. BUCHANAN: It's November 2nd.

MR. BLANKLEY: I think.

MR. BUCHANAN: It's either November 2nd this year or November of next year, John. If it's 60 days before --

MR. MCLAUGHLIN: All right, let's simplify. If there is a special election before our presidential election --

MR. BUCHANAN: There can't be.

MR. MCLAUGHLIN: Are you sure?

MR. BUCHANAN: I am sure.

MR. MCLAUGHLIN: If there is --

MR. BLANKLEY: Simultaneous with November 2nd.

MR. MCLAUGHLIN: All right, whom does that help and whom does it hurt?

MR. BLANKLEY: It potentially helps the Republicans.

MR. BUCHANAN: Potentially.

MR. MCLAUGHLIN: Why?

MR. BLANKLEY: Because otherwise Jersey is going to carry anyway. And this shuffles the deck.

MR. MCLAUGHLIN: Well, you mean that the confrontation of this particular new election is going to remind people of why there's a new election, and that's going to redound to helping the Republicans.

MR. BLANKLEY: It might.

MR. MCLAUGHLIN: So Schundler's upside-down.

MR. ZUCKERMAN: What he said makes absolutely no sense to me whatever.

MR. MCLAUGHLIN: Why?

MR. ZUCKERMAN: Because this is the last thing, it seems to me, that you're going to get a whole group of Democrats sitting around --

MR. MCLAUGHLIN: Well, you get Corzine in.

MR. BLANKLEY: Corzine is not going to --

MR. ZUCKERMAN: Corzine has no interest whatever in going into the capital of New Jersey. The guy is a senator and living in Washington.

MR. MCLAUGHLIN: Are you sure of that?

MR. ZUCKERMAN: I know him very well. Absolutely. He has --

MR. MCLAUGHLIN: He has to put it off and deny it because he's head of the Democratic Senatorial Campaign Committee.

MR. ZUCKERMAN: He doesn't want it.

MR. MCLAUGHLIN: He's collecting money --

MR. BUCHANAN: There's one chance for the Republicans; that is, to force McGreevey out before September 2nd and run against the rotten statehouse gang in Trenton. That could put New Jersey in play for November.
Corzine will crush anybody in that state for any office right now.

MR. MCLAUGHLIN: Do you feel that --

MS. CLIFT: With all due respect, the New Jersey statehouse isn't that big a prize. And I would like to make the point that --

MR. MCLAUGHLIN: It's the biggest statehouse in the country. We know that.

MS. CLIFT: That's right -- that the focus on his coming out as a gay man, the fact that he dwelled on that really shows how far we've come as a society, because that's no big deal. I mean, he was using that to cover up the other improprieties.

MR. BLANKLEY: Yeah, it was really a fraud using sexual victimhood to cover up his political cooperation.

MR. MCLAUGHLIN: Exit question: Will this scandal -- how much impact will this scandal have on the presidential election, all things considered? And you can also speak about the U.S. Senate election, the local election for senators in New Jersey and for other assemblymen. And what's the big impact?

MR. BUCHANAN: It will have zero if McGreevey holds to his plan not to quit until November. This will pass within the week. But if he --

MR. MCLAUGHLIN: Will he get away with it? Will he get away with it?

MR. BUCHANAN: If you can get him out of there before September, it could be a significant --

MR. MCLAUGHLIN: Will he get away with staying on until November?

MR. BUCHANAN: My guess is yes.

MR. MCLAUGHLIN: Really?

MS. CLIFT: Yes -- zero. And if --

MR. MCLAUGHLIN: Zero what?

MS. CLIFT: Zero impact on the presidential election.

MR. BLANKLEY: Yeah, I mean, probably, although the Republicans in New Jersey have already started. They're going to make a big effort here. I don't know how much noise they can make. It might help a little; probably not.

MR. ZUCKERMAN: Kerry is 20 points ahead in New Jersey. It's going to have zero effect on where New Jersey comes out in the presidential election. And if he stays in, as Pat indicates, and he will, it will have zero effect on New Jersey politics.

MR. MCLAUGHLIN: Unless there is -- and we don't seem to know that here -- there is a special election that does occur before November the 2nd.

MR. BUCHANAN: (Laughs.) It can't happen.

MR. MCLAUGHLIN: If that can't happen, it appears to have zero effect on Kerry. I agree with that.

Issue three: Crazy in Caracas.

If you thought that California Governor Gray Davis's recall election was dramatic, watch the world's first-ever recall election for a head of state this Sunday, Venezuela's Hugo Chavez.

Venezuela is important. The oil exported from Venezuela to the United States is 1.4 million barrels a day, 14 percent of our needs. Here's a not-unlikely scenario: If Chavez loses and he contests the results,
then demands a recount, then charges his opposition with fraud, then clings to power, that prolonged turmoil will lead to violence. And then the flow of Venezuela's oil to the U.S. would be disrupted, as has happened before.

If so, oil futures prices will rise from the current $45 a barrel to $50 a barrel. Since our economic recovery is fragile, that $50 a barrel would push the nation into at least a mild recession. Federal Reserve
Chairman Alan Greenspan is worried about oil. This week he blamed high oil prices for the lackluster job outlook.

Chavez and his many followers blame the United States for the 2002 failed coup against him. They also say the U.S. is funding his opposition today in the current referendum recall. They believe that candidate George Bush will score points with Cuban-Americans in Florida if he loses on Sunday; that is, Chavez. Miami Cubans detest Fidel Castro and they abhor Chavez, because Chavez helped prop up Castro's regime.

So this Sunday's referendum in Venezuela has the potential to reverberate not only on America's economy but also on its presidential politics. If Chavez is ousted, the new Venezuelan election in mid-September for a successor will galvanize the anti-Castro and anti-Chavez
Floridians, boosting Mr. Bush's chances of winning critical Florida in November -- where he is now behind, by the way.

MR. BLANKLEY: Yes, he is, but Kerry --

MR. MCLAUGHLIN: Is this, however, a win-win situation for Bush, meaning if Chavez stays in power, oil prices moderate and Bush wins, and if Chavez loses, the Miami Cubans are ecstatic and it gives Bush a big boost in Florida, where new polls show he's trailing Kerry? I ask you, Eleanor.

MS. CLIFT: On the list of things that can affect the Florida vote, I would put this down around number 100. First of all, Chavez, whether he's in or out, Venezuela is going to keep pumping that oil. Secondly, the old-line Cuban-Americans who hate Castro and always vote Republican -- there's a lot of newer Cuban-Americans who want to travel back and forth to Cuba, who want to live normal immigrant lives, and they hate the ban on travel that President Bush has put into effect and that Kerry opposes. That will have much more impact.

MR. MCLAUGHLIN: There is one significant flaw in your analysis, and that is that if we go through a sequence where he loses the election, the referendum, and the recall is present, he'll fight it. There'll be turmoil.

MR. BUCHANAN: Turmoil.

MR. MCLAUGHLIN: And then he's up for re-election with others in one month.

MR. BUCHANAN: The turmoil --

MR. MCLAUGHLIN: That turmoil will continue. That will definitely hurt our imports of that necessary oil --

MR. BUCHANAN: It will hurt Bush.

MR. MCLAUGHLIN: -- and it will affect the price per barrel. And according to the theory --

MR. BUCHANAN: John --

MR. MCLAUGHLIN: -- the price for oil is affecting jobs.

MR. BUCHANAN: Your prediction of $50 a barrel could very well come true. If you have turmoil, if Chavez loses and there's turmoil there, they're blowing up pipelines in Iraq, and in Russia, Khodorkovsky's in jail; Yukos is down.

MR. MCLAUGHLIN: Right. Right.

MR. BUCHANAN: All these things could reduce supply and you could have the price of oil go to $60 a barrel if there's turmoil in Venezuela.

MR. MCLAUGHLIN: And that, of course, is going to affect the economy.

MR. BUCHANAN: Bush. It'll affect Bush.

MR. MCLAUGHLIN: The economy right now is already soft. And the larger indicators indicate that it's expanding in that --

(Cross-talk.)

MR. BLANKLEY: Let me just make one point.

MR. MCLAUGHLIN: All right, you make the point.

MR. BLANKLEY: You're making a number of assumptions. One, you're assuming he's going to lose --

MR. MCLAUGHLIN: No, I'm not.

MR. BLANKLEY: -- which is probably not the case.

MR. MCLAUGHLIN: What's the best thing for the United States economy? If he wins. If he wins, because he has not been bad for business.

MR. ZUCKERMAN: He's been terrible.

MR. MCLAUGHLIN: He has not.

MR. BLANKLEY: Even if he loses --

MR. ZUCKERMAN: He's been terrible.

MR. MCLAUGHLIN: Tell that to Exxon-Mobil.

MR. BLANKLEY: Even if he loses --

MR. ZUCKERMAN: He may be good for an oil company. He's been terrible for the Venezuelan economy and he's terrible for our political interests.

MR. MCLAUGHLIN: It's good for everybody else but it's bad for the Venezuelans and it's bad for liberty, maybe. However, Chavez is not to be demonized, you know. He doesn't deserve demonization.

MR. BLANKLEY: (Inaudible) -- deserves demonization.

MR. ZUCKERMAN: He does, too, deserve demonization.

MR. BLANKLEY: Of course he does.

MR. ZUCKERMAN: The man's a thug, for goodness' sake.

MR. MCLAUGHLIN: Look, you talk to the Boston Democrats and ask them what they think about Chavez. That includes Congressman Meehan. It includes Congressman -- what's his name -- starts with a 'D' in Massachusetts.

MS. CLIFT: Delahunt.

MR. MCLAUGHLIN: Delahunt -- and they will tell you that they meet with Chavez and they think Chavez has been, I think it's fair to say, demonized.

MR. ZUCKERMAN: I have to tell you, I have met with Chavez and he is a demon, and he's totally --

MS. CLIFT: The lower-class people in Venezuela --

MR. ZUCKERMAN: He's pro-Cuba. He's helping the narco-terrorists in Colombia. He's importing every radical element --

MR. MCLAUGHLIN: Is he himself corrupt?

MR. ZUCKERMAN: Of course he is corrupt.

MR. MCLAUGHLIN: Who says he's corrupt?

MS. CLIFT: But lots of people are corrupt over there.

(Cross-talk.)

MR. BLANKLEY: He's also underfunding --

MR. MCLAUGHLIN: We've got to get out.

MR. BLANKLEY: He's also underfunding capital investment in the very oil business.

MS. CLIFT: He's done a lot for the poor.

MR. MCLAUGHLIN: It's probably a win-win situation, whether he stays or goes, for Bush. But right now this administration is muted in its condemnation or criticism of Chavez.

MR. ZUCKERMAN: Because they're afraid it'll help him in the election. That's why.

MR. MCLAUGHLIN: That's not right, because they know that if he doesn't -- if he goes down, he'll fight it. That'll mean turmoil and that will hurt the economy. Get the logic? We'll be right back.

(Announcements.)

MR. MCLAUGHLIN: Will Chavez win or lose, Pat?

MR. BUCHANAN: He wins, John.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I think he wins.

MR. MCLAUGHLIN: Tony.

MR. BLANKLEY: He wins the count if not the vote.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: He will lose the election. He may win the count, because it's a corrupt count.

MR. MCLAUGHLIN: Chavez wins.

Next week: China's role now in this hemisphere, and particularly in Venezuela. Bye bye.

(End of regular program; PBS segment follows.)

MR. MCLAUGHLIN: Issue four: Mr. Sensitivity. The political fencing between candidates Bush-Cheney and Kerry-Edwards has gone from sword play to blood sport. The foils are gone. The knives are in. Here's Vice President Cheney on Thursday.

VICE PRESIDENT DICK CHENEY: (From videotape.) Senator Kerry has also said that if he were in charge, he would fight a more sensitive war on terror. America has been in too many wars for any of our wishes, but not a one of them was won by being sensitive. President Lincoln and General Grant did not wage sensitive warfare, nor did President Roosevelt, nor Generals Eisenhower and MacArthur.

MR. MCLAUGHLIN: The Kerry camp hit back, calling the administration's attacks, quote, "pathetic and desperate attempts to avoid coming clean with the American people about their failed policies." It then pointed out that President Bush himself had used the 's' word in the same context just last week.

PRESIDENT BUSH: (From videotape.) Now, in terms of, you know, the balance between running down intelligence and bringing people to justice, obviously we need to be very sensitive on that.

MR. MCLAUGHLIN: Question: Will Cheney now enroll, do you think, in sensitivity training? I ask you, Tony.

MR. BLANKLEY: No. Look, by the way, Kerry was talking about fighting. The basic point is --

MR. MCLAUGHLIN: The fundamental question is justice in both instances.

MR. BLANKLEY: No, no.

MR. MCLAUGHLIN: A just war --

MR. BLANKLEY: No, no. That's not correct. When Kerry's statement -- when he said we have to fight a more sensitive war, he didn't talk about justice or anything else. It was about fighting war. Bush was talking about sensitivity in --

MR. MCLAUGHLIN: This is what Kerry actually said. "I believe I can fight a more effective, a more thoughtful, more strategic, more proactive, more sensitive war on terror."

MR. BLANKLEY: Exactly.

MR. MCLAUGHLIN: Now, do you think the utilization of that --

(Cross-talk.)

MR. MCLAUGHLIN: Do you think Cheney was justified, or do you think it was a cheap shot?

MR. ZUCKERMAN: It's a politically justified shot which, by definition, is a cheap shot. But I'll guarantee you this; Kerry wishes he hadn't used the word "sensitive."

MR. BUCHANAN: Sure.

MR. MCLAUGHLIN: (Inaudible.)

MR. BUCHANAN: Cheney drew blood on that one, and the Kerry folks know it.

MR. ZUCKERMAN: Absolutely.

MR. MCLAUGHLIN: Kerry may have the last laugh, because now Halliburton becomes all the more vulnerable in view of the leaked report from the Pentagon saying, "Improper or inadequate explanations have been given for spending billions of dollars by Halliburton."

MS. CLIFT: Well, and that hits people's pocketbooks.


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