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MR. MCLAUGHLIN: Issue One: Hurricane Bad, Aftermath Worse.

PRESIDENT BUSH: (From videotape.) A lot of people working hard to help those who've been affected. And I want to thank the people for their efforts. The results are not acceptable.

MR. MCLAUGHLIN: A week ago it was a small tropical depression off the coast of Florida. That was then. In less than a week, on Monday, Hurricane Katrina slammed into the east coast of Florida with winds of over 145 miles per hour. When it reached the Gulf, it dipped, then grew into a Category 5 storm before making landfall again in Alabama, Mississippi and Louisiana. New Orleans took a wicked hit. The storm surge filled the city's streets, leveling homes, shattering glass, hurling metal through the air like missiles. But the worst was yet to come. On Tuesday, two levees holding back the water of Lake Pontchartrain burst, leaving 80 percent of the bowl-shaped city underwater.
Dead bodies floated through the streets. Those who escaped sought shelter in the squalor of the Superdome, some 9,000, where there was no food, no water, no medical supplies. A few days later, conditions seemed to grow from crisis to drift. No one was in charge. Relief was not forthcoming. Where was the president? The Manchester, now New Hampshire, Union-Leader, conservative newspaper, tells us where the president should have been. "A better leader would have flown straight to the disaster zone and announced the immediate mobilization of every available resource to rescue the stranded, find and bury the dead, and keep the survivors fed, clothed, sheltered and free of disease. The cool, confident, intuitive leadership Bush exhibited in his first term, particularly in the months immediately following September 11th, 2001, has vanished. In its place is a diffident detachment, unsuitable for the leader of a nation facing war, natural disaster and economic uncertainty."

Question: Is the Union-Leader right? Should Bush have returned to the White House earlier? Pat Buchanan.

MR. BUCHANAN: The Union-Leader is exactly right, John. John, the question "Who lost New Orleans?" is going to be as serious for Bush his second term as 9/11 was positive for his first term. The president can be faulted. The administration can be faulted. They were asleep at the switch in Crawford. They were late getting there. They were not prepared. FEMA was not prepared.

In addition to this, you've got the story of the National Guard being over in Iraq against the National Guard should be down there. The levees were not -- the levees, excuse me -- (corrects pronunciation) -- were really not prepared. The Corps of Engineers were not properly funded. And already -- I mean, the president should be criticized, but already this is being exploited politically and the attacks are coming. And I think, John, this thing is going to divide us racially and politically and poison our politics, I think, for the rest of the Bush term.

MR. MCLAUGHLIN: On Friday morning at 11:35 in the morning, East Coast time, President Bush, in Mobile, addressed Alabamans and all Americans.

PRESIDENT BUSH: (From videotape.) The federal government, John, is big and is massive, and we're going to do it. Where it's not working right, we're going to make it right. Where it is working right, we're going to duplicate it elsewhere. We have a responsibility at the federal level to help save life, and that's the primary focus right now. Every life is precious.

MR. MCLAUGHLIN: Do you think President Bush's appearance on the scene did anything to improve his handling of the situation? Eleanor Clift.

MS. CLIFT: This is a moment for national leadership. He comes across more like a foreman at the local factory. And very rarely does the New Hampshire Union-Leader speak for me. It's an archconservative newspaper. But I think they're right on point.

On Tuesday, when the devastation was beginning to reveal itself, the president was in Arizona at a Medicare event. Then he went to San Diego to a naval base for yet another anniversary for the greatest generation. And I think he was mostly worried about oil prices. He didn't really relate to what was happening.

And the slowness of the administration's response makes you wonder. This was mother nature's disaster. But if we can't handle this, how do we handle a man-made event? We've had four years since 9/11. We have a Department of Homeland Security. Instead, Homeland Security and FEMA, the Emergency Management Agency, I think they're fighting about whether they should wear FEMA jackets or Homeland Security jackets. And the response, as the president correctly said, is inadequate.

MR. MCLAUGHLIN: Tony, I note that your newspaper wrote a strong editorial about the president. I want to hear about that. But do you think heads are going to roll over this? Who was advising the president this time to go forward with those addresses, as though nothing had ever happened, in Arizona and California?

MR. BLANKLEY: Well, as you know, very few heads roll in this administration. But, yes, I did an editorial, lead editorial, in our Friday Washington Times which was critical of the president, not as harshly as the Manchester Union-Leader.

MR. MCLAUGHLIN: What was the POV?

MR. BLANKLEY: Well, my sense is and I think the building consensus is that the whole bureaucracy, led by the president and by the governors, et cetera, lost a step. They lost 24, 36 hours before the whole mechanism started coming finally together Thursday night. And, yes, I think there is a political price to pay under these circumstances.

Now, the other piece of this is that everybody is now -- all of his opposition are coming in with the most extravagant and absurd -- they're laying in every single political issue they don't like and laying it on him. Just one example; the question of the National Guard. There are plenty of National Guard available, both Louisiana National Guard and others. The problem was -- and it was a problem --was they weren't activated and moved quickly enough. Although the president ordered things in advance, it was slow motion for about 36 hours. And I've just got a hunch, and I don't know whether it's true, but when they do the after-action study, this was a stutter-step disaster. We first had this hurricane come in and everyone thought New Orleans had avoided the silver bullet at that point.
Everyone kind of eased back a little bit. And then the levees broke and all hell broke loose. And I suspect that the bureaucracy, without the adequate leadership, kind of paused. It was in action mode, then went into inaction, and then went into -- and I think we lost 36 hours and a lot of lives because of it.

MR. MCLAUGHLIN: Do you think he should have raced back, called a Cabinet meeting together, called his departments and agencies and those who are controlling the resources?

MR. BLANKLEY: That is --

MR. MCLAUGHLIN: That's exactly what Richard Clarke said, you recall, after 9/11. The president failed to do that. He failed to bang heads together.

MR. BLANKLEY: Let me say, after September 11th there was a question of security in Washington. That's a separate issue. But, sure, both for PR 101 and because you want to be back here, I think he should have come back a day earlier.

MR. MCLAUGHLIN: Do you think his circle of governors is getting too narrow or had always been too narrow, that he doesn't reach out enough, that he's a --

MR. BUCHANAN: John, he should have sent in the 82nd Airborne by Tuesday, when you hear that there's looting and people are being shot and they're cleaning out stores and they're carrying guns. That's what we did in Newark and Detroit when we had those terrible times. There are poor people being threatened in there and there are predators, and the Airborne should have been in there. They could have been in there in 12 hours.

MR. MCLAUGHLIN: There is a demographic dimension to this, social, economic and racial. And Elijah Cummings, Democratic congressman from Maryland and former chairman of the Black Caucus, took the issue of the social, economic and racial status of those who were trapped in the city.

REP. ELIJAH CUMMINGS (D-MD): (From videotape.) The difference between those who lived and those who died in this great storm in 2005 was nothing more than poverty, age or skin color. MR. MCLAUGHLIN: Clarence Page, what are your impressions? What are your impressions of what the congressman says?

MR. PAGE: Well, anybody who watched the coverage this week could certainly see that the most miserable stories, as well as those who were dying in the streets and suffering through this, were primarily black and poor. We know that New Orleans is 62 percent black, of which about 25 to 30 percent are below the poverty line. This is not new.

MR. MCLAUGHLIN: They were trapped. They couldn't get out.

MR. PAGE: Yeah, but that's the thing, John.

MR. MCLAUGHLIN: They didn't have $50 or $5 even for a hotel room.

MR. PAGE: That's the key. You know, the key word here is preparedness. And when they decided to make evacuation the central part of the storm response plan, somebody should have thought that, hey, maybe 100,000 to 200,000 people wouldn't have cars, wouldn't be able to get out. And that's the kind of thing that we saw the residual effects of here.

They were directed to the Superdome. The Superdome was not safe and it didn't have the facilities. They were directed to the convention center and they got there and there was no food, no water, not even a guy with a clipboard over there. I mean, these are the kinds of things --

MR. MCLAUGHLIN: What's the racial -- can you talk a little bit more about the racial dimension of this? Why is it that there's a correlation between the black and the poor?

MR. PAGE: Well, that's the case in most American cities, with the exception of places like Los Angeles, where it's mostly Hispanic. Washington DC is over 60 percent black and heavily poor. And that's the thing, John. If we have another disaster, which will happen in some big city, whether natural or man-made, we've got to think in these plans about the underclass or the elderly, the sick, the immobile, or the people who simply don't have cars.

MS. CLIFT: The thing is --

MR. MCLAUGHLIN: Just a moment. Are the poor poor because they're black?

MR. PAGE: In America? (Laughs.)

MR. MCLAUGHLIN: In New Orleans. MR. PAGE: Well, you know, we would be nuts to say race wasn't a part of it. But, you know, one of the impressions -- Tony is talking about just PR and the impression that the whole world gets watching these news pictures. You see black people.

MR. MCLAUGHLIN: Clarence, the overwhelming number of people you see are black.

MR. PAGE: Yeah, right. That's exactly right. You see that right away.

MS. CLIFT: It looks as though we have --

MR. MCLAUGHLIN: That is overpowering, is it not?

MR. PAGE: It's overpowering.

MS. CLIFT: It looks as though we have apartheid in this country when you look at those television pictures. That is the image that comes across. If you were poor, black, you couldn't get out of the city. And the war-gamers, the people who war-gamed these scenarios as recently as a few months ago, knew that there would be 100,000 people left behind who couldn't get out. You needed to provide buses to get them out. The president should have declared a state of national emergency and emptied out the military bases from Texas --


MR. MCLAUGHLIN: Let her finish.

MS. CLIFT: -- and emptied --

MR. BUCHANAN: Eleanor, you're right.

MS. CLIFT: Let me finish the sentence --


MS. CLIFT: -- before you tell me I'm right -- (laughs) -- and emptied out the military bases from Texas. That's what should have happened.

MR. BUCHANAN: The point of this is, look, they were not unprepared because these folks were black. Look, the poor down there -- 67 percent of the city is black. Probably 90 percent of the poor folks are black. But FEMA was unprepared. It had nothing to do with race. It had to do with guys not being prepared, not on the job. And I think it is grossly unfair to suggest, you know, we left them behind. There's no doubt those who had the least suffered the most.

MS. CLIFT: We're not -- we don't have --

MR. MCLAUGHLIN: Okay, okay. Anarchy spreads. In Katrina's wake, looting has been widespread. In New Orleans, looters sacked shops and stores to get food, water, clothing, even electronic goods. An entire Wal-Mart gun section was robbed. One New Orleans police officer was shot in the head by armed looters. Two officers, caught on a rooftop, exchanged shots with armed gangs.

In Mississippi, people scavenged ruined casinos and plundered slot machines. Thievery was widespread. One reason given was the police and the National Guard personnel were in short supply.

Many Guard members have been called up in active duty and deployed with the armed forces in Iraq. Police units throughout the South are also short-staffed because many local police are also military reservists and have been called up.

The lawlessness has expanded. Bodies have been found riddled with bullets. Women have been raped. Gunmen are roaming the streets in trucks, firing shots at police. Some police officers have drowned. Others have turned in their badges.

Question: What do you think the international community thinks when it sees these scenes on television this week? I ask you, Tony.

MR. BLANKLEY: Well, I don't think there's any question that they think we don't look as masterful at controlling a situation. You know, they think of us as we can do anything. And obviously things got completely out of control. And I suppose we look a little less formidable, both to friends and enemies, now than we did a week ago.

MR. MCLAUGHLIN: You know, Somalia called us up and asked us whether they could help.

MR. PAGE: And El Salvador.

MR. BLANKLEY: I know. I want to make one point about the previous segment. It's all known -- there was a book written in 1989 that describes the people -- the poorer you are, the lower you live elevationally in New Orleans. So by chance -- poor people always live in the worst part of town in any city. But it happens that in New Orleans the poor part of town is the lower part of town. This is a product of living patterns for generations. You have a black Democratic mayor there. You have a Democratic governor there. And to lay all of the problems of race in Louisiana off on George Bush is really appalling.

MR. MCLAUGHLIN: Do you think George Bush is going to be able to do for New Orleans what he wants to do for Iraq, namely, restore stability, rebuild the infrastructure? Do you think he'll be able to do that?

MS. CLIFT: The point is -- (Cross-talk.)

MR. MCLAUGHLIN: I want to hear from Eleanor.

MS. CLIFT: The point is that the rest of the world looks at us and says where do we get off telling other people how to live?

MR. MCLAUGHLIN: Wait. This is democracy. Don't you like democracy in action?

MS. CLIFT: Well, the governor is saying she's expecting 40,000 troops, which I think began arriving today. That puts in perspective how many troops you need to control a situation like this. And it also is a great contrast to the fact that we never had enough troops in Iraq either.

MR. BUCHANAN: The impact of this, of who lost New Orleans, is Americans are not going to look abroad. They're going to look inward.


MR. BUCHANAN: They're going to be looking to the United States.


MR. BUCHANAN: The president's war policy, in my judgment, is in deep, deep trouble. Now, Tony's got a point there. Plenty of National Guard down there they could have used. It was mishandled. Maybe some of their equipment was there. But they had enough American troops and local troops. But Americans are going to say, "Look, we've got people suffering and dying in New Orleans."


MR. BUCHANAN: "Our border is unprotected. We're worried about the border of Syria. We're worried about the Persian Gulf when the Gulf of Mexico is our concern."

MR. MCLAUGHLIN: What about isolationism? Is that going to be on its way back?

MR. BUCHANAN: Look, people are going to --

MS. CLIFT: President Buchanan. I hear it. (Laughs.)

MR. BUCHANAN: Look, I don't believe we should isolate.

MR. MCLAUGHLIN: You mean we are overcommitted abroad? Is that what you're saying?

MR. BUCHANAN: I'm saying people are going to say, "Why have we got troops over there in Central Asia and Iraq and the Balkans? We need them right here in the United States of America."

MR. MCLAUGHLIN: We can't police at home because we're policing abroad.

MR. BUCHANAN: Exactly.

MR. BLANKLEY: Let me make a quick point here. The president has got plenty of problems, both responsibility in New Orleans --

MR. MCLAUGHLIN: No kidding.

MR. BLANKLEY: -- and political. But, as the American public sees his opposition trying to use this to take an unfair shot at him on every issue, whether it's Pat's on the border, yours on Iraq --

MR. MCLAUGHLIN: You think the opposition is generating this outrage. Is that it?

MR. BLANKLEY: No, no, exactly not. I'm saying --

MS. CLIFT: The Manchester Union-Leader --

MR. MCLAUGHLIN: Let him finish. Let him finish.

MR. BLANKLEY: Let me finish, please, Eleanor.

MS. CLIFT: You've gone on for quite some distance and made your point, I believe.

MR. BLANKLEY: Let me finish. No, my point is, the president is in a deep mess. But the opposition may misplay it by overplaying their hand and accusing him of even more than he's responsible for.

MS. CLIFT: Right. Where is this great opposition? Unless you're counting me. No prominent Democrats are out there criticizing the president personally.

MR. BLANKLEY: That's not true. Schumer was out there.

MS. CLIFT: The -- well --

MR. BLANKLEY: The head of the Democratic Congressional Campaign Committee --

MS. CLIFT: News pages, the people who were affected primarily. It is not partisan complaints. They are a small portion of the complaints this president is getting. His own party is frustrated.

MR. MCLAUGHLIN: On a political catastrophic damage scale, a political catastrophic damage scale, zero to 10, zero meaning zero damage, 10 meaning political apocalypse now, how much political damage has been inflicted on George Bush by Katrina? Pat Buchanan.

MR. BUCHANAN: It is a seven to an eight. And there are going to be hearings and everything. It could go to a 10. But on the other hand, depending on how the president and first lady handle it, it could go back to a five or a four. And Tony's point is well taken. Everybody's out there, from the environmental minister of Germany to ride his hobby horse on global warming.

And if this gets to the point where everybody's riding their own hobby horses, people will spot it's political and will move back the other way.

MS. CLIFT: Well, first of all, global warming is not a hobby horse. It is not a frivolous matter.

MR. BLANKLEY: It's also not --

MR. MCLAUGHLIN: Let her finish.

MS. CLIFT: The severity --

MR. BLANKLEY: It's also not --

MR. MCLAUGHLIN: Let her finish.

MS. CLIFT: The severity and frequency of the storms are something we have to be concerned about, and they're tied with climate change. And you're going to see the insurance companies and the multinational corporations, a lot of people getting out there taking global warming very seriously.

This is at least an eight. And the president's words, when he says, "Nobody thought the levees would break," they're going to go back and look at all those requests for funding and the turndowns for funding, and he's going to eat those words the way Condoleezza Rice ate the words that nobody thought a plane would ever fly into a building.


MR. BLANKLEY: By the way, if you read the New York Times, it says there's no relationship between global warming, which they believe exists, and this hurricane. So read the New York Times for once on this one.

MS. CLIFT: Well --

MR. BLANKLEY: Look, I think --

MR. PAGE: (Inaudible.) MR. MCLAUGHLIN: Quickly, quickly.

MR. BLANKLEY: I think right now it's about a seven. It could be a 15, depending on how he performs. On the other hand, if he gets a grip on this, I think he could bring it down to a four.

MR. PAGE: I think it's a nine, as it should be. It's knocked the president off-message; knocked him off of his agenda. He's got to turn around now and look at what he didn't want to look at before, which is things like global warming, things like the levees breaking, and money to spend on the wetlands --

MS. CLIFT: Wetlands; all the things they've made fun of.

MR. PAGE: -- all these domestic programs, long-range preparedness, that he hasn't wanted to worry about before.

MR. MCLAUGHLIN: He got bulletins from NOAA, which is National Atmospheric & Oceanic Administration --

MR. PAGE: I thought you meant the guy with the ark.

MR. MCLAUGHLIN: -- telling him that the levees were secure up to 115 miles per hour. As soon as he saw that the winds had exceeded that, which was a full 48 hours in advance of that, because it had picked up and got up to 160, I think, when it got over the Gulf, he should have raced back to Washington and then pulled it all together. Instead of that he goes to Arizona. He goes to California. I think you're right. I think it's a nine-plus.

Issue Two: Economic Fallout.

Motorists are in for Labor Day sticker shock this weekend. The Gulf Coast is home to 15 percent of the nation's oil and natural-gas refineries. Almost all refineries were shut down because of Katrina. Gas prices are expected to top $3 a gallon soon. Pessimistic analysts predict $5 a gallon within a month. In response, President Bush has opened the nation's Strategic Petroleum Reserve. But the problem is refineries, not petroleum supply.

Then there's insurance. Insured property losses may be as high as $25 billion. But uninsured property losses will far exceed that amount. Many business and homeowners do not have flood insurance. Standard insurance will not compensate them for water damage due to hurricane unless the damage can be traced to wind damage. This means that scores of thousands of homes and businesses cannot be rebuilt without U.S. government aid. So Congress will have to ante up.

Finally, the Gulf Coast is a vital shipping and warehousing hub for chemicals, for American agricultural exports, and for imports. Until ports and warehouses are repaired, which may take weeks, if not months, the impact of rising prices will add to an already rising inflationary concern.

Question: How bad is Katrina's economic fallout? Tony Blankley.

MR. BLANKLEY: Well, everything you've said and a little bit more, because one of the big problems not yet discussed is that the port, once its facilities are repaired, will have nobody to man it because the city is gone. The entire population of New Orleans, out of whom were the people who manned it, the thousands of people who worked there, they're gone. We have to set up a new city just to run the port. It's a huge problem, which is one of the reasons, by the way, why the Nazis tried to take out the port with U-boats back in World War II.

MR. MCLAUGHLIN: Did I hear someone quote Dennis Hastert as saying that the city of New Orleans is not worth rebuilding because it's --

MR. PAGE: Not exactly, but close.


MR. PAGE: He said maybe we ought to reconsider not
rebuilding it --

MR. MCLAUGHLIN: Meaning because it's --

MR. PAGE: -- which he began to back-pedal almost immediately.

MR. MCLAUGHLIN: What he meant was below sea level.

MR. PAGE: Yeah, because it would be so much trouble, so much money. But that's not going to happen. The fact is --

MR. MCLAUGHLIN: It would not be secure even then.

MR. PAGE: Exactly. And it's not going to happen. It was politically naive at best for him to say that. But it's not going to happen because of the fact that the economics of New Orleans are so important. They're going to build tents, Tony, if they have to, or bring in house trailers to house people. But it's going to take a while to rebuild that port. By then you're going to start seeing some houses rebuilt.

MS. CLIFT: We haven't --

MR. MCLAUGHLIN: But Tony's point is well taken, Eleanor. The ports and the harbors are the big thing.

MS. CLIFT: Right. But we have an administration with two oil executives. Why don't they get the oil companies in and maybe get them to volunteer to cut their profits a bit here until we can get the economy back up on its feet and maybe give the consumers a break? MR. MCLAUGHLIN: Exit question. Pat, you can expand it a bit if you wish. Will Katrina plunge the economy into a recession, Pat?

MR. BUCHANAN: Well, I think it depends, John, on whether the gasoline prices keep going up. I think they're reaching the breaking point for the economy. But some refineries have already come on line, I mean, you found out as of Friday. So I don't think it's a sure thing. We've got some good numbers in the economy. Unemployment is down to 4.9 percent. Open question.


MS. CLIFT: I think the chances are high for a recession as a result of all of this.


MR. BLANKLEY: No way of knowing. The Dow Jones has been slightly up this week, if that means anything. I think it's a big question mark.

MR. MCLAUGHLIN: What do you think?

MR. PAGE: I agree. But I'm optimistic. I think it's like 9/11. We thought things were going to be worse than they turned out to be in the long run. And I think here, too, Americans are very resilient when they want to be.

MR. MCLAUGHLIN: I think maybe a point or a point and a half below the projected 4 percent, but I don't think a recession. That's the growth rate, Pat. I notice you're looking at me kind of funny.

Issue Three: Vox Populi. The latest ABC News/Washington Post poll, taken before Hurricane Katrina, has President Bush at the lowest ratings ever for that poll: Disapprove, 53 percent; approve, 45 percent.

What do you make of these numbers? I ask you, Eleanor Clift.

MS. CLIFT: I think you have war weariness and a lack of confidence in the president's leadership on Iraq. And then you have the rising gas prices. And I think there are polls that show now more Americans cite the high cost of gasoline as their top concern, over and above Iraq. And so I don't see any -- as I look into my crystal ball, I don't see any places for the president to win.

MR. MCLAUGHLIN: Do you think that Bush is a lame duck already?

MR. BLANKLEY: Well, I think it's too soon to tell. He could be. Depending on, obviously, how the New Orleans catastrophe plays out, he could be. MR. MCLAUGHLIN: Do you notice how easy it is for both Hastert and Frist to dance away from him on fetal research?

MR. BLANKLEY: Well, that was before the hurricane.

MR. MCLAUGHLIN: I know it, before the hurricane. Do you think he's going to gain from the hurricane, even though he shot up when the hurricane hit? Do you think he's going to shoot down just as --

MR. BLANKLEY: There was a poll out Sunday, Monday and Tuesday in the Field this week, and he went up 10 points on the Tuesday sample. It was a small sample, only 300. Now, that was before Wednesday and Thursday and some of the images. But the initial reaction of the public was really around the flag. So I want to reserve judgment.

MR. MCLAUGHLIN: Predictions. Pat.

MR. BUCHANAN: John, because of the "Who lost New Orleans" disaster and the tremendous focus on that next week, which is the first week of the hearings of John Roberts and maybe the last week, I think John Roberts is going to sail through. The Democrats aren't going to want to be hectoring him when they've got a lot bigger target.


MS. CLIFT: President Bush's tax-cutting days are over. The Congress was expecting to eliminate the estate tax, which would have drained billions from the federal budget. With a war and a hurricane bailout, the Congress cannot, with a straight face, go ahead with that.


MR. BLANKLEY: Just as immediately after September 11th Bush had a few bad days and he then really got on his game, I think we're going to see, after some tragically couple of bad days, that Bush is going to bring his kind of bulldog determination to the war on rebuilding New Orleans and he may recover his stride.


MR. PAGE: Look for a revival of waterways improvement bills, including the locks and dams along the Mississippi.
MR. MCLAUGHLIN: Hu Jintao, China's president, visits the White House next week. He's not head of state; the prime minister is. But Bush will yield to Jintao's demands and give him a 21-gun salute.

Labor Day best wishes to all of our viewers from the Group.

Bye bye.