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THE MCLAUGHLIN GROUP

HOST: JOHN MCLAUGHLIN

PANEL: PATRICK BUCHANAN, MSNBC; ELEANOR CLIFT, NEWSWEEK; TONY BLANKLEY, THE WASHINGTON TIMES; LAWRENCE O'DONNELL, MSNBC

FRIDAY, MARCH 11, 2005

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MR. MCLAUGHLIN: Issue One: Means Justify the End.

SEN. : (From videotape.) The bill, as amended, is passed.

MR. MCLAUGHLIN: The long-awaited measure to overhaul U.S. bankruptcy laws was passed this week by the Senate, 74-25. Passage of the bill marks another pro-business victory for the Republican-controlled Congress. It reveals how the majority is able to tackle issues that have been lingering for years.
The bankruptcy bill was first introduced in 1997. It makes it more difficult for individuals to avoid their debts by declaring bankruptcy. Bankers have strongly supported the measures. They say that many customers have used bankruptcy as a financial planning tool. Bankers say
that they want to encourage responsible behavior by those who can afford to repay their debts.
Not everyone agrees that this is good legislation. Senator Edward Kennedy was one of the measure's chief opponents. "The bill favors the worst of the credit industry, the interest-rate gougers, the pay-day
lenders, the abusive collection agencies. It hurts real people who lose their jobs because of outsourcing or suffer major loss of income because they were called up for duty in Iraq or Afghanistan or lose their savings because of a medical crisis."
SEN. EDWARD KENNEDY (D-MA): (From videotape.) They get an incidence of cancer. They run up those bills. And what does this bill do? It's going to make them indentured servitude to the credit-card companies. And we call that fairness? Is that fairness?

MR. MCLAUGHLIN: Question: Is this bill, which is certain to pass the House, constructive public policy? Pat Buchanan.

MR. BUCHANAN: It is necessary legislation, John. There's no doubt about it, some credit-card companies send out these credit cards to everybody. Then when you're late, they charge you 20 or 30 percent interest, which is like loan-sharking.
But the truth of the matter is, there's an awful lot of people, and many of them young people, who take these credit cards, go on vacations, go on buying sprees, and just walk away from the bills. And it's a disaster, and something has to be done to deal with it. This thing
has been in the process for five, six years. And I think it's not a perfect bill, but it is necessary legislation. And I think, all in all, it's going to do some good, and I would have voted for it.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Well, the hypocrisy of the Republican Congress, which is running the country into hock, now lowering the hammer on the little guy who maxes out credit cards because he loses a job; maybe there's a divorce, medical bills. There may be a small percentage who are buying trips to Vegas and plasma-screen TVs, but the overwhelming majority are people who run into real problems.
And the bill does nothing to get at the real scofflaws, the Donald Trumps who have declared bankruptcy at least twice; the Ken Lays, the Bernie Ebbers. They can keep all of their assets and go their merry way, and this bill doesn't affect them at all.

MR. MCLAUGHLIN: Do you think this is compassionate conservatism in process, Tony?

MR. BLANKLEY: I don't know that it's compassionate. I think it is conservative. This is a sad business when people go bankrupt. And agony results when usually relatively small-time people run out of the last bit of credit and they go bankrupt. So it's not a happy thing to have to say that the creditors are entitled to their money.

But I think that our system of economy requires -- (inaudible).

I have to say there's one zone where I was inclined to agree with Ted Kennedy, and that was where he said that this homestead exemption, which some states, like Texas, have, so you can buy a multimillion-dollar home and have that exempt from the creditors who you owe money to.

Now, I don't like the idea of the federal government telling the states what to do, but I think the idea is that if you're, in fact -- we're going to be tough on people who are not paying their creditors, we should include rich people who hide their money in fancy homes.

MR. MCLAUGHLIN: The heart of this bill is means-testing, as was noted in that clever title that I gave the issue. Right?

MR. O'DONNELL: That's right.

MR. MCLAUGHLIN: Now, means-testing means your personal income. It means whether you have the money or the assets to pay the bill that you are seeking relief for, for the debt of that bill, of those bills, through bankruptcy proceedings. And the means-testing is that you have
to do quite a bit of accounting, and you probably will need legal counsel to do that to fulfill the requirements of establishing that you don't have the means.

MR. O'DONNELL: Right. And the --

MR. MCLAUGHLIN: But if you have someone who's broke and can't pay his bills, that means-testing that is demanded under the new law is unfair and inequitable. You believe that.

MR. O'DONNELL: There are 50 different means tests in this bill, one for each state, because the level of income they measure is the median income for a particular state.
Now, in a state like New York, that's absurd, because it has rural Appalachian-style poverty pockets in upstate New York, and then it has incomes of a vastly different nature in New York City. And they take the median for the entire state to apply to everybody.

But, look, if you're a Republican --

MR. MCLAUGHLIN: If you're underneath that median, just to carry this a step further, then you're eligible for bankruptcy proceeding. If you're over the median, then you're ineligible for it.

MR. O'DONNELL: Except that that's not true because of the exemption on housing that Tony mentioned. There's also a Mercedes exemption.

If you are leasing or paying for a Mercedes, a $75,000 or
$80,000 car, in payments that you're obligated to pay, that is exempt from your --

MR. MCLAUGHLIN: So this is a loophole for whom?

MR. O'DONNELL: If you bought the Mercedes with cash for $75,000, you have to surrender it because you actually acted in a more financially responsible way. Look --

MS. CLIFT: (Inaudible.)

MR. MCLAUGHLIN: Let him finish.

MR. O'DONNELL: The greatest Republican president, Abraham Lincoln, filed for bankruptcy when there were no real limitations on it at all; the most liberal bankruptcy proceedings you could imagine. It is not a dishonorable outcome for people to file for bankruptcy. And that's
what these Republicans believe. They wouldn't even allow an amendment that would limit interest to 30 percent on credit cards. The religious book that they all follow, the Bible, precludes usury, but they voted for it in the federal government.

MR. MCLAUGHLIN: All right, I want -- just for clarification, the loophole that you were describing is a loophole that's fitted out for the fat cats. Correct?

MR. O'DONNELL: Basically anything you are contracted to pay, you are allowed to use in exempting you from the thresholds on what allows you to go bankrupt. It's an absurd bill that is so tilted in favor of the rich that it's just wildly out of proportion.

MR. MCLAUGHLIN: The principal reason for declaring bankruptcy is what?

MR. BUCHANAN: If you don't have enough money. (Laughs.)

MR. O'DONNELL: Fifty percent of personal bankruptcies come from health --

MR. MCLAUGHLIN: Medical is second. The first one is job loss and the third is a broken marriage. The first one is job loss, then medical, then a broken marriage. So what does that suggest to you about the people declaring bankruptcy?

MS. CLIFT: That it's justified and that they're being punished because of actually -- particularly with health care, because of flaws in our society.

MR. MCLAUGHLIN: There were 1.6 million --

MS. CLIFT: And this bill presumes that everybody is a slacker.

MR. MCLAUGHLIN: (A fact?) -- there were 1.6 million bankruptcies last year, 1.6 million, up from 200,000 in the late '70s, 27 years ago, I believe.

MR. BUCHANAN: But, John, look --

MR. MCLAUGHLIN: So that's quite a --

MR. O'DONNELL: Look what the credit-card companies have done.

MR. BUCHANAN: John, come on, we're getting --

MR. MCLAUGHLIN: We're trying to get at the bottom of -- to what extent the credit cards -- it's owing to the credit cards.

MR. BLANKLEY: Let me make a quick point. If the government of the people want to be sympathetic to people, let's have a federal program that subsidizes them. But to ask creditors who lent them money legally to say that you're going to have to subsidize this generosity of yours,
that's why we need the bankruptcy law.

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

MR. BUCHANAN: Okay, go ahead.

MR. MCLAUGHLIN: The exit question. Is the bankruptcy bill sound public policy, or is it, as Senator Kennedy says, mean-spirited, with the Republicans once again stroking the fat cats? Pat Buchanan.

MR. BUCHANAN: I think it is sound and necessary. In some cases they're not going to be very good. But, John, we have not touched on the fact that there are hundreds of thousands of deadbeats out there who go run up bills and walk away from them and laugh, and the rest of the
middle class and everyone has got to pick up the tab for those people.

There are some hardship cases, I don't deny. There's crooks who buy $25 million homes in Florida, put all their money in it, declare bankruptcy, sell the house and go to the Bahamas.

MR. MCLAUGHLIN: What you're saying is that the credit-card companies have to jack up the interest rates on the rest of us, who are presumably --
MR. BUCHANAN: Well, they do. And there are --

MR. MCLAUGHLIN: However --

MR. BUCHANAN: I agree it's loan-sharking. I mean, this is usury. In the Middle Ages the church --

MR. MCLAUGHLIN: Well, what about -- do the credit-card companies really have to jack it that much, or can they eat some of that themselves?

MR. BUCHANAN: (Laughs.)

MS. CLIFT: The credit-card companies are riding high. This is a payoff for the political contributions, not only to Republicans but a whole bunch of Democrats who voted for this bill. It's shameful, this bill.

MR. MCLAUGHLIN: We're way over.

MR. BLANKLEY: I think it's sound policy, but I would have made it tougher on the rich people's exemptions.

MR. O'DONNELL: Credit-card lobbyists paid $35 million to get this bill passed. It was money well-spent that favors them 100 percent.

MR. MCLAUGHLIN: You would have voted for it?

MR. BLANKLEY: Yes, but with --

MR. BUCHANAN: They'll get it back in a week. (Laughs.)

MR. BLANKLEY: -- but not giving the exemptions to wealthy people.

MR. MCLAUGHLIN: I concur with Tony. I think he's stumbled onto something that's quite accurate.

Let's talk very briefly about monetary matters, since we're in the general area of finance. Here's a potential hair-raiser. "I believe diversification is necessary." So says the Japanese head of government, Juniko Koizumi this week -- Junichiro. Sorry, Mr. Koizumi. What he is
saying is that the U.S. dollar is so weak that the Japanese should buy something else besides the dollar -- diversify.
Koizumi's statement follows on the heels of South Korea saying the same thing last month -- diversify away from the dollar.
Question: Patrick, how serious is this story?

MR. BUCHANAN: This is very serious. But the Chinese, the
Japanese and the Asians, I think, have something close to $2 trillion in these American dollar-denominated assets. Here is the problem. Koizumi then could say, "We're going to dump the dollars." Okay, you do that, the dollar sinks in value, and the value of their reserves contracts
dramatically. If you try to get -- the first guy out the door wins. But if everybody runs to try to get out the door, it all collapses.

MR. MCLAUGHLIN: Is the whole thing worrisome?

MR. BUCHANAN: Interest rates will go up like a spike.

MR. MCLAUGHLIN: Could it explode?

MR. BUCHANAN: It could be a financial crisis --

MR. MCLAUGHLIN: Are you predicting that?

MR. BUCHANAN: I believe it's coming, and I believe --
(Cross-talk.)

MR. MCLAUGHLIN: I want to hear it again. (Laughs.)

MR. BUCHANAN: I believe a financial crisis is coming, and I don't think the Bush people understand it.

MR. BLANKLEY: The president of Japan had to be corrected by his staff, because he hadn't said what he intended to say. What he said was there should be diversity of assets within American denominations, not as between America and the EU, and that when that happened, everybody calmed down.

MR. MCLAUGHLIN: You know what -- what's the line they're putting out now? It's called backing and filling.

MR. BLANKLEY: No, that's --

MR. MCLAUGHLIN: And he's doing that because he created a hole and now he realizes how big and embarrassing the hole is. It doesn't mean that he originally intended to say that.

MR. BLANKLEY: The markets believe that backing and filling.

MR. MCLAUGHLIN: When we --

MS. CLIFT: The point is still there that the Japanese have a hold on American sovereignty that should make everybody nervous, especially Alan Greenspan.

MR. MCLAUGHLIN: When we come back, hundreds of thousands of Lebanese citizens demonstrate this week for Syria. So can Syria be all that bad?

(Announcements.)

MR. MCLAUGHLIN: Issue Two: Syria's Next Move.

PRESIDENT BUSH: (From videotape.) The time has come for Syria to fully implement Security Council Resolution 1559. All Syrian military forces and intelligence personnel must withdraw before the Lebanese elections for those elections to be free and fair.

MR. MCLAUGHLIN: That was on Tuesday. One day later, Wednesday, the pro-Syrian majority in the Lebanese parliament asked pro-Syrian Prime Minister Omar Karami to return to government one week after he resigned.
This surprise move followed a week of massive protests in Beirut, protests both for Syria and against Syria, meaning Syria's 13,000-troop presence in Lebanon. At the heart of the matter is Hezbollah, the Shia Islamist movement that is flourishing in Lebanon as political
party, social-services provider and militia.
Why does Hezbollah worry the West?
Item: Demographics. Forty percent of Lebanese people are Shia Muslims. Many of them support Hezbollah.
Item: Political power. Hezbollah controls southern Lebanon as a nearly independent government.
Item: Military force. Hezbollah controls a trained militia of 25,000 troops with access to sophisticated guns, rockets, and even a new drone spy plane.
Item: The company it keeps. Iran gives money to Hezbollah, say western diplomats, $200 million a year.
That's why Hezbollah worries the West. So why does Hezbollah appeal to the Lebanese?
Item: Organization. On a few days' notice, Hezbollah was able to turn half a million people out to the streets of Beirut to march in its own support and in support of the pro-Syrian president, of the pro-Syrian prime minister and of the pro-Syrian majority in parliament.
Item: Reputation. Hezbollah is known for its clean, relatively uncorrupt governing of south Lebanon and for running dozens of mostly modern hospitals and schools.
At week's end, the U.N. took action. It sent a top envoy to Damascus to warn Syrian President Bashar Assad that the nations of the world will put political and economic pressure on Syria if Syria does not remove its 13,000 troops from Lebanon.
Question: If Syria leaves, Lebanon will not have the resources to extend its authority over its entire national territory. So will President Bush send U.S. military troops to Lebanon to maintain stability until the Lebanese can do it for themselves? In other words, open up a new theater. What do you think, Tony?

MR. BLANKLEY: I think it's more likely, if that contingency arises, that the French would likely provide forces, given their traditional relationship to Lebanon. If we use forces, and it would be very much a last resort, it would be if the Syrian troops have not left. But I
don't think we'd go in to manage a situation where they had left.

MR. MCLAUGHLIN: Why don't we go in there, bring democracy --

MS. CLIFT: Hezbollah's position --

MR. BUCHANAN: United States forces are not going into Lebanon after that Beirut bombing 20 years (ago). Bush would not do it and should not do it, John. The truth of the matter is we may not like it. There's half a million Syrians in Lebanon. There are a million and a half
Shias. Under Hezbollah you are going to have to bring Hezbollah into the political process and the elections in May. We may not like it, but the Americans are moving to do it right now.

MR. MCLAUGHLIN: Pat, we've got to bring freedom into that country. That's what this president stands for. The neocons want it.

MR. BUCHANAN: One man, one vote is going to give Hezbollah about 50 seats in that parliament. They've got 14 now.

MS. CLIFT: Hezbollah's stated position is that they will fight against any uninvited foreign invader. And they did that terrible terrorist incident against the U.S. when, under the Reagan administration, we went in there. They have not targeted Americans since we got out of there. Bush is not going to go into that country and provoke incidents on American citizens.

MR. MCLAUGHLIN: Exit question --

MR. BLANKLEY: (Inaudible) -- the United States right now. Hezbollah has terrorist cells in the United States right now, according to the latest reports.

MS. CLIFT: I haven't noticed any incidents lately, Tony.

MR. BLANKLEY: Secretary of State Rice said this week that they're going through the Mexican border. So the idea that they're not targeting the United States is, I think, a dangerous point.

MS. CLIFT: If we go in there, we're sure they will target. They haven't so far, so let's --

MR. MCLAUGHLIN: Excuse me. Excuse me. I'll get my Tazar (sic) out.

MR. BUCHANAN: Tazer. (Laughs.)

MR. MCLAUGHLIN: The French are telling Mr. Bush that Hezbollah must be kept in line, meaning on board, in order to get the Syrian troops out of Lebanon. If he doesn't have Hezbollah, they can't -- we don't have Hezbollah, or the coalition doesn't. We can't accomplish our objectives there.
So will the president refrain from pressuring Hezbollah? Pat.

MR. BUCHANAN: The Syrian troops are going. I'm confident they are.

MR. MCLAUGHLIN: What about my question?

MR. BUCHANAN: They're going to delay. But you're exactly right, John. Like it or not, they represent something like 40 percent of the people of Lebanon. And if you want a democratic government or a coalition government of some kind, you cannot freeze them out. They have
enormous credibility because they ran the Israelis out of Lebanon.

MS. CLIFT: It's abhorrent to the administration to deal with them, but they're already making steps in that direction because they've got 13 seats in the parliament. And if you provoke them and anger them and don't deal with them, you're going to end up with bigger problems.

MR. MCLAUGHLIN: So they will probably -- the president will probably keep his cool on that.

MS. CLIFT: Right.

MR. MCLAUGHLIN: What do you think?

MR. BLANKLEY: Well, Hezbollah has its own problems. To the extent that they're seen, as they have been to some extent, as helpful to the Lebanese, they have genuine support. If they're seen as merely accountable for Syria, their support could be reduced. So they've got to play
a careful game, as does everybody else, including our president.

MR. O'DONNELL: It would be a mistake for the -- to force the Syrian troops out precipitously. There would be a huge vacuum created, as your first question on the subject suggested. It should be done very carefully, in a programmed way, that Lebanon can predict the withdrawal
level and know how it's happening.
But there's a massive opening for Hezbollah for us to be saying, "Let's get the Syrian troops out of there." The problem is we don't know what actually takes its place in the dynamics of that country.
Lebanon is a complete mess. The only -- (inaudible) -- that it has, actually, comes from Syrian troops.

MR. MCLAUGHLIN: Did you see any signs this week that the outgrowth could occur again of extreme factionalism that ruined that country for a period of about 10 years? You remember how Beirut looked?

MS. CLIFT: The Syrians --

MR. MCLAUGHLIN: I interviewed Arafat in Beirut in 1982, and what a disaster that city was.

MS. CLIFT: That's why the Syrian troops are there, because they ended the civil war. And they do portray themselves as the big brother protecting the Lebanese from the U.S. and from Israel. And that's an argument that is powerful to a lot of people that live there. You can't
dismiss it.

MR. MCLAUGHLIN: I think that Lawrence here has given us a bit of wisdom. Do you not think so, Pat? I mean, in other words, the president said, "Get them out by the election." The election is May.

MR. BUCHANAN: Let me say, John --

MR. MCLAUGHLIN: Whereas you've got Condi Rice sounding like a school teacher saying, "You've got to go -- (inaudible) -- right now."

MR. BUCHANAN: John, the president has a problem. Let me tell you this. Every time he speaks up and denounces the Syrians and says, "You've got to do this" and embraces an organization, to a degree he contaminates it, because it is then seen as the agents of the Americans, who are deeply unpopular, I regret to say, throughout that world.

MR. MCLAUGHLIN: By the way, Europe and the Brits want the Hezbollah not to be fomented into taking a position of retention of the troops. The Hezbollah would probably go along if we just kept it cool.

Issue Three: Hawk in the Hen House.

SECRETARY OF STATE CONDOLEEZZA RICE: (From videotape.) He's a tough-minded diplomat. He has a strong record of success. And he has a proven track record of effective multilateralism.

JOHN BOLTON (U.N. AMBASSADOR-DESIGNATE): (From videotape.) Madam Secretary, my record over many years demonstrates clear support for effective multilateral diplomacy.

MR. MCLAUGHLIN: President Bush this week nominated John Bolton as U.S. ambassador to the U.N., making him one of this country's highest-profile diplomats.
Some find Mr. Bolton and the U.N. to be an odd coupling, because Mr. Bolton, currently the undersecretary of State for arms control, is notoriously seen as undiplomatic, blunt and hawkish.
Bolton on Iran.

MR. BOLTON: (From videotape.) I can assure you we're not going to allow America's national security to be dependent on the good faith of a group of fanatic mullahs seeking nuclear weapons.

MR. MCLAUGHLIN: On Cuba.

MR. BOLTON: (From videotape.) The United States believes that Cuba has at least a limited offensive biological warfare research and development effort.

MR. MCLAUGHLIN: On Iraq.

MR. BOLTON: (From videotape.) We have very convincing evidence that Iraq maintains an extensive program for the production and weaponization of weapons of mass destruction.

MR. MCLAUGHLIN: On North Korea: "For many in North Korea, life is a hellish nightmare."
On the United Nations: "A great rusting hulk of a bureaucratic superstructure that is dealing with issues from the ridiculous to the sublime. There is no such thing as a United Nations. There is an international community that occasionally can be led by the only real power
left in the world, and that is the United States, when it suits our interest and when we can get others to go along."

Question: Is the nomination of Mr. Bolton in keeping with the tradition of past U.S. ambassadors to the U.N.? Adlai Stevenson, Daniel Patrick Moynihan. I ask you, Lawrence.

MR. O'DONNELL: No. This is a disastrous appointment. Ambassador Moynihan very much believed in the United Nations.

MR. MCLAUGHLIN: You worked for him.

MR. O'DONNELL: Yes, when he was Senator Moynihan. And one of his last books was about international law; a big believer in international law. And you need a diplomatic temperament in the job, which this guy
doesn't have. He has said things publicly that are absurd, and the most --

MS. CLIFT: He's a human wrecking ball. (Laughter.) His world view is that we have no obligation to follow international law. International law doesn't exist. We're the only superpower, and all we do is lead. And if others don't follow, the heck with them.

MR. BUCHANAN: Look, he is not a bring-us-together
multilateralist. This is a guy -- that's exactly right -- he's the man for that position. He will speak the president's mind. He will defend American sovereignty. He will tell them at the U.N., "You guys are in deep trouble in this country." He is blunt, and that's what they need.

MR. MCLAUGHLIN: They need a catalyst.

MR. BUCHANAN: Yeah.

MR. BLANKLEY: Yeah, Bulldog Bolton.
He is --

MR. MCLAUGHLIN: You mean, more (powerful?).

MR. BLANKLEY: Yeah. I mean, he is going -- he's no diplomat in the nice sense of that word, but he may very well be the Nixon to China into the U.N., because the U.N. is so degraded at this point, it's got to be --

MR. MCLAUGHLIN: I agree with you, but I also agree with him. But I think that Bolton will turn around the U.N., but the U.N. will also turn around Bolton.
We'll be right back with predictions.

(Announcements.)

MR. MCLAUGHLIN: Predictions, Pat; very tight.

MR. BUCHANAN: Law of the Sea treaty passed the Foreign Relations Committee, 19 to zero. It will go down in the Senate. It will not even be brought up for a vote.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Bolton will set himself up as a rival secretary of State and give Condi Rice heartburn.

MR. MCLAUGHLIN: Tony.

MR. BLANKLEY: In fact, Bolton was Condi Rice's first choice, as she told the Washington Times exclusively Friday morning. He will pass the Senate by about 63 votes.

MR. O'DONNELL: President Bush's private accounts for Social Security will not even make it out of the Senate Finance Committee.

MR. MCLAUGHLIN: Wow. Kofi Annan will finish out his term, John Bolton notwithstanding.
Next week, Bolton's Senate confirmation hearings. Will he give us more good copy? Bye bye.

(END OF REGULAR PROGRAM; PBS SEGMENT FOLLOWS.)

MR. MCLAUGHLIN: Issue Four: Arnold Takes the Cake.

CALIFORNIA GOVERNOR ARNOLD SCHWARZENEGGER (R): (From videotape.) Since I am governor of the state of California, again, I can do my part to pass laws that would take the junk food out of the schools, out of the vending machines -- take all that out and give them healthy foods.

MR. MCLAUGHLIN: It's the latest big idea from Governor Schwarzenegger -- ban junk food in California's public schools. One in three American children eats fast food each day, and 9 million American children are obese. Governor Schwarzenegger wants our children to be leaner.
Does the state have any role in dictating what the public schools have available for children to eat? I ask you, Pat Buchanan.

MR. BUCHANAN: I think the state should stay out. I do agree that that kind of junk should probably be gotten out of the schools. It's a decision by parents, teachers, local school boards. I think Arnold should stay out of this one.

MR. MCLAUGHLIN: Ray Kroc sold 1 billion burgers. Is
Schwarzenegger on the wrong side of this issue?

MS. CLIFT: No. (Laughs.)

MR. MCLAUGHLIN: Should he just stay out of it? Don't get in between your parents and junk food?

MS. CLIFT: He's on the right side of the issue. You need to have a counterweight to the corporate power of shoving this food down kids' throats. And Schwarzenegger is a brilliant politician. He's beating up on the nurses. He's cutting services to poor people. And then he distracts with this issue. It's a great idea and he's a magnificent pol.

MS. MCLAUGHLIN: Why not train kids how to handle it and leave it where it is and talk to them about calories and that kind of thing?

MR. BLANKLEY: Look, kids are famous for bringing what they want and trading what they don't want. They trade a tuna sandwich for a candy bar. You're never going to stop kids from eating what they want.

MR. MCLAUGHLIN: Are you against this?

MR. O'DONNELL: The diversion isn't working for Schwarzenegger. Protesters are following him everywhere he goes because of his budget cuts, what he's doing to firefighters' pensions.

MR. MCLAUGHLIN: You think this is a decoy mechanism on his part?

MR. O'DONNELL: He's being attacked now everywhere he goes for his big fund-raisers. He's the biggest fund-raiser in the history of California politics; said he didn't need any money to run for office and is now raking in more than anybody who's ever run.

MR. MCLAUGHLIN: Is junk food a decoy mechanism for him?

MR. O'DONNELL: You know, it's been an issue in California for many years.

END.