THE MCLAUGHLIN GROUP HOST: JOHN MCLAUGHLIN PANEL: RICH LOWRY, NATIONAL REVIEW; ELEANOR CLIFT, NEWSWEEK; MONICA CROWLEY, SYNDICATED RADIO COMMENTATOR; MORT ZUCKERMAN, U.S. NEWS & WORLD REPORT TAPED: FRIDAY, SEPTEMBER 26, 2008 BROADCAST: WEEKEND OF SEPTEMBER 27-28, 2008
Copyright (c) 2008 by Federal News Service, Inc., Ste. 500 1000 Vermont Avenue, NW, Washington, DC 20005, USA. Federal News Service is a private firm not affiliated with the federal government. No portion of this transcript may be copied, sold or retransmitted without the written authority of Federal News Service, Inc. Copyright is not claimed as to any part of the original work prepared by a United States government officer or employee as a part of that person's official duties. For information on subscribing to the FNS Internet Service, please visit http://www.fednews.com or call(202)347-1400
MR. MCLAUGHLIN: Issue One: The Perfect Storm -- Bailout, President, Congress.
PRESIDENT GEORGE W. BUSH: (From videotape.) Americans have felt anxiety about their finances and their future. I understand their worry and their frustration. We've seen triple-digit swings in the stock market. Major financial institutions have teetered on the edge of collapse, and some have failed. As uncertainty has grown, many banks have restricted lending. Credit markets have frozen, and families and businesses have found it harder to borrow money.
MR. MCLAUGHLIN: What do you propose that we do, sir? PRESIDENT BUSH: (From videotape.) Under our proposal, the federal government would put up to 700 billion taxpayer dollars on the line to purchase troubled assets that are clogging the financial system.
MR. MCLAUGHLIN: The $700 billion figure is the administration's educated guess for the cost to the taxpayer to gather and to sequester the massive toxicity from bad home loans now poisoning the economy. The assumption is that with the toxic waste cleaned out, the engines of American capitalism will be free and robust again.
Question: Treasury Secretary Paulson went down on his knees Thursday night, literally, to beg House Speaker Nancy Pelosi not to back away from his bailout package. Was Paulson begging the right person, namely Pelosi?
MR. LOWRY: No. In theory, of course, in the House, John, the majority can slam anything it wants through without the minority. But as a practical matter, she's going to want Republican support to do this. She's asking for 100 votes. Probably 70 or 80 will do it.
So he should have been kissing John Boehner's ring or kissing whatever else was necessary on John Boehner to get this through. There's a narrative out there blaming John McCain for the House Republicans. But let me tell you, you put the words "bailout" together with "$700 billion," you're going to have House Republicans upset no matter what John McCain is doing.
MR. MCLAUGHLIN: Well, Boehner did support the idea, though.
MR. LOWRY: In theory. But now there's a Republican alternative out there, and the question is whether he can deliver his caucus around some compromise.
MR. MCLAUGHLIN: Eleanor.
MS. CLIFT: Well, there's a Republican revolt. Basically it's the House Republicans who don't want to go along with this thing, and they're getting a lot of phone calls, as are the Democrats. The calls on Capitol Hill are 300 to 1 against this plan. And these are not Astroturf calls. These are real people calling up angry.
And we're all populists now. I mean, the notion of bailing out Wall Street and rich bankers and letting taxpayers fend for themselves is just not a palatable plan. And so when Paulson got down -- he got down on one knee, and he was half-joking -- (laughter) --
MR. LOWRY: (Laughs.) So it doesn't really count.
MR. MCLAUGHLIN: Some Republicans have called --
MR. ZUCKERMAN: And he had a knee pad under the knee. MR. MCLAUGHLIN: Some Republicans have called this socialism, not democracy. Do you think it's socialism?
MS. CROWLEY: I think there are huge parts of this program that Republicans have serious issues with because it involves the nationalization of private companies. So when the Treasury secretary of the United States falls on one knee and begs the House speaker, Nancy Pelosi, to get this package through, how desperate and pathetic when the Democrats have the majority in the House. Nancy Pelosi could ram through any possible package she wants to. She's done it in the past.
The problem is that the Democrats know that this plan is a big dud. They need Republican backing. They need Republican cover in order to get it through in case it all goes south. Then they can all take the blame. And the House Republicans are saying, "Hold on. There are better alternatives here that involve market incentives and cover for the taxpayers in particular, and let's take a look at those options rather than go headlong in a giant panic for a behemoth of a bill that's bad."
MR. MCLAUGHLIN: Mort, I'll call you in a minute.
Okay, the faceoff. On Thursday afternoon, the president held a history-making White House emergency session. The president told key congressional leaders that the need to get government money was immediate or the bailout plan would collapse. Mr. Bush's exact words, quote: "If money is not loosened up, this sucker could go down." (Laughter.)
The meeting began Thursday at about 4:00 p.m. By 10:30 p.m., congressional leaders, frustrated by wrangling and fatigued by complexity, quit for the night. The hard-core Republicans on Capitol Hill were in revolt, leaving Democrats feeling blindsided. Former chairman of the Senate Banking Committee, Republican Richard Shelby, led the charge.
SEN. RICHARD SHELBY (R-AL): (From videotape.) We haven't got an agreement. There's still a lot of different opinions. Mine is it's flawed from the beginning. The Paulson plan is a bad plan. It will not solve problems. It will create more problems.
MR. MCLAUGHLIN: On Friday morning, the president urged Senate, House and White House leaders to get a plan.
PRESIDENT BUSH: (From videotape.) My administration continues to work with the Congress on a rescue plan. And we need a rescue plan. This is -- it's hard work. Our proposal is a big proposal. And the reason it's big and substantial is because we've got a big problem. There is no disagreement that something substantial must be done. The legislative process is sometimes not very pretty. But we are going to get a package passed. We will rise to the occasion. MR. MCLAUGHLIN: Question: Some opponents of the bailout see the $700 billion whopper, as I noted earlier, as socialism. Is it run-of- the-mill socialism, do you think?
MR. ZUCKERMAN: Well, it's a unique kind of package. I'll say that. And it's not the one that I would support, frankly.
I think the package is right in the sense that you have to put this kind of huge number in order to make the financial world feel that you have the resources to deal with the problem, because it is a gigantic problem, and nobody knows how big the problem is.
But to buy these assets in, these mortgage-backed securities, the way they're talking about it, which is not to give it the market price but to give it some substantial number above the market price in order to give assets to the very companies that took these wild risks, I think, is what is galling the Republicans and galling the country. They feel it is absolutely unfair to bail out these people in this way.
There are other ways, much better solutions, in which -- to use an example, Warren Buffett put $5 billion into Goldman Sachs. They ought to follow that model. He got a preferred position. He gets an interest rate. He gets a chance to convert it into 7 to 10 percent of Goldman Sachs at some future date. That's the way you ought to do this. There are private solutions, which are the right model.
MR. MCLAUGHLIN: Who are the "they" besides --
MS. CLIFT: We're taking pledges now, Mort.
MR. MCLAUGHLIN: -- Buffett who's going to do that? Who are the "they"?
MS. CLIFT: Mort --
MR. ZUCKERMAN: Well, you just saw -- just a minute. You just saw that where J.P. Morgan, for example, went in and bought WaMu, the Washington Mutual. There are people out there. But I'm not suggesting, by the way, that a private individual should do that, because it's too big for any group of individuals.
MR. LOWRY: Right.
MR. ZUCKERMAN: But the government ought to take that position.
MR. MCLAUGHLIN: So you're opposed to any add-on in order to induce the buy. MR. ZUCKERMAN: No, I am opposed -- I'm not -- I'm saying the government ought to get a fair deal out of it, and they ought not to just enrich --
MR. MCLAUGHLIN: But they're going to sequester these. And when the market returns, then they will have their fair deal.
MR. ZUCKERMAN: Who knows whether they will have their fair deal? Nobody knows what the value of these mortgages are. And it's getting worse and worse all the time.
MR. MCLAUGHLIN: Okay. Customizing the deal. The president's $700 billion package was criticized for lacking accountability and transparency. So for the government to purchase troubled assets and buy equity in financially distressed firms, three basic features were phased in to the $700 billion framework: $250 billion immediately, $100 billion if the Treasury certifies, $350 billion if Congress certifies.
This modified $700 billion bailout also includes oversight board; authority to terminate program; special investigator general to monitor; government audits, regularly scheduled; government mortgage renegotiations as needed to help delinquent borrowers stay in their homes.
Question: Is the newly structured compromise an improvement on the Paulson plan? I ask you, Eleanor.
MS. CLIFT: Yes. But when Mort mentioned the Buffett contribution, I thought maybe you were ready to make a pledge here on the set as well. (Laughter.)
MR. ZUCKERMAN: Goldman Sachs called me and said, "Would you like to invest in the company?" But they have a secondary issue. I said, "I don't want to buy the secondary issue, but if you let me buy in on the Buffett plan, yes, that I would do."
MR. MCLAUGHLIN: Why didn't you pick up Washington Mutual for $1.9 billion?
MR. ZUCKERMAN: My life is too sane to do that, thank you very much.
MR. MCLAUGHLIN: What do you mean, 2,200 banks?
MR. ZUCKERMAN: They have 2,200 banks. It's $1,600,000,000,000 of assets. And, by the way, I think J.P. Morgan is the right people who did it. They took a huge risk. They were willing to get the government to guarantee above $30 billion. Their competitors said, "You have to" --
MR. MCLAUGHLIN: They also picked up Bear Stearns. What do they do, prowl the streets at night? (Laughter.) MR. ZUCKERMAN: No, they actually were very, very intelligently managed. They have probably the best banking management of any of the large banks. They kept out of a lot of the problems that other banks got into. That enabled them to have the dry powder to do the things they've just done.
MR. LOWRY: John, John --
MS. CLIFT: I'm inclined --
MR. MCLAUGHLIN: Eleanor.
MS. CLIFT: I'm inclined to think there is an urgency to do this and that something has to be done. But characterizing it as a bailout was a mistake from the beginning. They should call it a loan. They're basically going to loan money to these banks and they're going to get it back. And the fact that the House Republicans now want to structure it, as they put it, from the bottom up sounds real appealing, but they also want to cut corporate taxes.
MR. LOWRY: Well, that's not going to happen.
MS. CLIFT: Nobody wants to cut corporate taxes in this climate.
MR. LOWRY: John, this is a socialistic-style intervention to save capitalism, because you don't have capitalism without capital and credit and loans. And all those things are going to freeze up. And whether the Paulson thing is the best way to do it or what Mort's suggesting, I don't know for sure, but it's going to be a big government intervention. And I think Paulson should have the most flexibility possible, with a lot of oversight, to see what works.
MR. MCLAUGHLIN: The problem is, when you start down this, quote- unquote, "socialistic path," it's very hard to get off --
MS. CROWLEY: Right.
MR. LOWRY: You need --
MR. MCLAUGHLIN: -- because governments suddenly become the remedy.
MR. LOWRY: In financial panic, you need a government backstop.
MR. MCLAUGHLIN: What?
MR. LOWRY: In a financial panic, you need a government backstop, because in a panic --
MR. MCLAUGHLIN: Where is the public --
MR. LOWRY: -- the markets run out of control and they do damage to the wider economy out of all proportion to reason. MS. CLIFT: The problem is --
MR. MCLAUGHLIN: Where is the public on this? Where is the public?
MR. LOWRY: They're against.
But those phone calls --
MS. CLIFT: The public has no confidence --
MR. MCLAUGHLIN: Wait a minute. Wait a minute. Hold on, Eleanor.
MR. LOWRY: Those phone calls into those congressional offices --
MR. MCLAUGHLIN: What?
MR. LOWRY: Those phone calls into the congressional offices that are all against -- if this thing doesn't pass and there's a crash, they'll all be calling, panicked, and say, "Where are my deposits? Where are my loans?"
MS. CLIFT: The problem is there's no confidence in this administration. When the administration says, "Trust me," people do not believe it. And President Bush was not a very reassuring figure the other night. I mean, he looked like somebody playing president, and not doing a very good job.
MS. CROWLEY: Wait a minute. This package --
MS. CLIFT: It's a portrait in lame duckery.
MS. CROWLEY: This package --
MR. MCLAUGHLIN: Is that a bum rap against Bush?
MS. CROWLEY: It's a bum rap against Bush, because the administration and the Democrats in Congress orchestrated this bailout package. It's the House Republicans now --
MS. CLIFT: Oh, please.
MS. CROWLEY: -- that are opposed to it. And isn't it --
MR. LOWRY: It was Paulson's idea.
MS. CROWLEY: Excuse me. Isn't it ironic -- MR. MCLAUGHLIN: Did --
MS. CROWLEY: Isn't it ironic that now the Democrats, who have loathed this president and denounced him, are now in bed with him? And suddenly the administration looks really competent to these Democrats.
MR. MCLAUGHLIN: Isn't --
MS. CROWLEY: Listen, vast majorities of the American public are running against this plan. They know it's a lemon. They know it's a dud. It's way too much government intervention with them, with too few guarantees that they're going to get their money back.
MS. CLIFT: What's your alternative, Monica?
MR. LOWRY: Well, they can take ownership of the depression. They can take ownership of the depression when it happens.
MR. ZUCKERMAN: The alternative is to get the money into the banks, just not in this way. I do agree with you; we have to have this kind of a program.
MR. MCLAUGHLIN: Repeat that.
MR. ZUCKERMAN: The alternative is to have the government do what Hank Paulson's former company did. You sell shares to the government for $200 (billion) or $300 (billion) or $400 billion, depending on what the companies are, and they have a preferred position so that they get their money back. And the company has to withstand the losses that they have. But they have the capital now put into those banks, okay, that enabled them to do that. But they should bear the loss.
MR. MCLAUGHLIN: Do you anticipate any radical revision of the $700 billion bailout, as we saw it in the customized version a moment ago?
MR. ZUCKERMAN: I do. I do not think they're just going to buy in these mortgage-backed securities, which nobody can appreciate, nobody can understand, nobody can value. When they say --
MR. LOWRY: That's why they have to take them, Mort. Someone has to take them out of the system. That's why injecting --
MR. ZUCKERMAN: They don't --
MR. MCLAUGHLIN: Let him finish.
MR. LOWRY: -- just injecting capital and leaving it in there isn't necessarily any better. MR. MCLAUGHLIN: Mort.
MR. ZUCKERMAN: The issue is you've got to get capital into these financial institutions. On that I agree. But you don't have to do it by buying out these lemons and letting the companies escape the consequences.
MR. LOWRY: They're worth something. They're worth something.
MR. ZUCKERMAN: We don't know what they're worth.
MR. LOWRY: They're worth more than they are valued now --
MR. ZUCKERMAN: You don't know that.
MR. LOWRY: -- at the fire-sale panic --
MR. ZUCKERMAN: You do not know that.
MR. MCLAUGHLIN: Exit question: Will --
MR. LOWRY: They are worth more than they are now.
MR. ZUCKERMAN: You don't know that, because you don't know what's going to happen --
MR. MCLAUGHLIN: Hold on. Will the billion-dollar banking bailout bill restore stability to the housing market? Yes or no? Rich.
MR. LOWRY: Yes, it will. I think it'll work.
MS. CLIFT: It'll keep the bottom from absolutely falling out.
MS. CROWLEY: It depends what kind of package is passed.
MR. MCLAUGHLIN: Well, you saw the customized version -- 300, 100, 250.
MS. CROWLEY: It's so big, it's going to be --
MR. MCLAUGHLIN: What?
MS. CROWLEY: The thing is going to be passed. But if the so- called cure is worse than the disease, it will not restore confidence.
MR. MCLAUGHLIN: That sounds like a no.
MS. CROWLEY: Okay.
MR. MCLAUGHLIN: A guarded no. MS. CROWLEY: Okay.
MR. ZUCKERMAN: No, it will not. Housing prices will continue to go down by 15 to 20 percent, and it's going to render all of these securities much less valuable. And nobody knows how far down it will go.
MR. MCLAUGHLIN: I think it's going to quiet down the electorate for a while.
I therefore think that it is at least an immediate or a short-term, maybe a longer-term, win.
Issue Two: McCain To The Rescue.
Republican presidential candidate John McCain on Wednesday announced that he would suspend his campaign to focus on the economic crisis, and in doing so, he would forgo the scheduled Friday night debate against Senator Barack Obama.
SEN. JOHN MCCAIN (R-AZ, Republican presidential nominee): I'll suspend my campaign and return to Washington after speaking at the Clinton Global Initiative. I've spoken to Senator Obama and informed him of my decision, and I've asked him to join me.
MR. MCLAUGHLIN: Then, with the $700 billion banking solution in sight, McCain did what he said he would do. He will debate Obama.
Question: Was it smart for McCain to suspend his campaign and return to Washington to try to help forge a consensus? Monica.
MS. CROWLEY: Very politically savvy for him. Some people called it a stunt. Sure, it was a stunt. It was also extremely effective. He also put the country first, which is part of John McCain's pattern. And also part of his pattern is that he is a gambler. He throws the dice.
John McCain was the only one who could deliver the Republicans and deliver the president. As of this taping, we're still working on that. But for McCain to come back and put Barack Obama in the box, forcing him also to come back to Washington to sit with the president and work on this -- let's not forget, they are still U.S. senators. They have day jobs.
MR. MCLAUGHLIN: Eleanor.
MS. CROWLEY: Get to it. For Obama to put his campaign first is absurd.
MS. CLIFT: We're not watching the same campaign. I think John McCain looks reckless. He came barreling back into the city; hadn't even read the three-page Paulson proposal. He sat in the meeting at the White House, said nothing. The deal fell apart after he arrived on the scene. I don't think he gets any credit for putting anything together. And he blinked in terms of agreeing to debate, because they didn't have a deal when he agreed to go ahead and break his pledge and debate.
MR. MCLAUGHLIN: McCain doesn't have to do the fine print. He's a deal-maker. He's an activist.
MR. LOWRY: Well, John --
MR. MCLAUGHLIN: Right?
MR. LOWRY: -- McCain is in the position of constantly having to hit the restart button on this campaign to keep it in turmoil, to keep shaking it up, because conditions are so bad for Republicans.
What was wacky about this, though, he hadn't even taken a position, really, on the Paulson plan when he said, "I'm going to the Capitol to hammer it out." And we don't really know how it's turning out yet. It'll depend on whether there's a deal or not.
MR. MCLAUGHLIN: But reductively, was this a contrivance on his part?
MR. LOWRY: It was showmanship, yes.
MR. MCLAUGHLIN: Showmanship --
MR. LOWRY: Absolutely.
MR. MCLAUGHLIN: -- in order to --
MR. LOWRY: Absolutely.
MS. CLIFT: Politics is theater. (Laughs.)
MR. ZUCKERMAN: Whether it was a political advantage for him will be determined over the next few days, whether they make a deal and what the deal is. That will determine it.
MR. MCLAUGHLIN: Okay. CEO portfolio blues.
HENRY PAULSON (U.S. Treasury secretary): (From videotape.) The American people are angry about executive compensation, and rightfully so. Many of you cite this as a serious problem, and I agree.
MR. MCLAUGHLIN: CEO compensation -- it's a huge sticking point for many in Congress.
REP. BARNEY FRANK (D-MA): (From videotape.) It's inconceivable to me that we would pass a bill in which hundreds of billions of dollars of taxpayers' money is put at risk and the people who caused the problem are able, without any restraint, to keep enriching themselves.
MR. MCLAUGHLIN: CEO enrichment ongoing? Forget about it. Try de-enrichment. CEOs get paid by salary and by company stock. When that stock was way up, they were flying high. But when the hot air went out of that balloon, they went into free fall, de-enrichment.
Here's 10 of the biggest losing CEOs, based on their personal portfolio, company stock holdings, and dating from 20 months ago to September 19 this year.
Henry Paulson, former CEO, Goldman Sachs, current secretary of the Treasury, from $809 million to $523 million.
Daniel Mudd, former CEO, Fannie Mae, $26 million to $476,000.
Richard Syron, former CEO, Freddie Mac, $11 million to $130,000.
Martin Sullivan, AIG, $3.2 million to $173,000.
John Thain, Merrill Lynch, $28 million to $16 million.
Richard Fuld Jr., Lehman Brothers, $827 million to $2.3 million.
John Mack, Morgan Stanley, $225 million to $80 million.
Charles Prince, Citigroup, $89 million to $33 million.
And get this -- James Cayne, Bear Stearns, $1.1 billion -- that's "b" as in "boy," billion -- to $61 million.
And get this -- Maurice Greenberg, AIG, $1.25 billion -- that's "b" as in "boy," billion -- to $50 million.
Question: Does this explain why Secretary Paulson was so frantic to bail out Wall Street, because his friends are losing money by the scores of millions of dollars every day? Mort.
MR. ZUCKERMAN: No, I don't think that's his reasoning at all. I think he's really trying to do a good job in public policy. I don't happen to agree with exactly the way his program is done. But, look, let me tell you something. If the banks get subsidized through this purchase of these mortgage-backed securities, these stocks are going to go up and they'll make back some of that money.
MR. MCLAUGHLIN: Hey, Mort, your portfolio is about $3 billion, right? How much did you lose?
MR. LOWRY: (Laughs.)
MR. ZUCKERMAN: Well, you're very nice to ask. (Laughter.) That's wonderful. But as you know, from being on this program, I have been very worried about this for a long time. And we have, in many ways, converted a lot of our assets into cash.
MR. MCLAUGHLIN: You have?
MR. ZUCKERMAN: Yes -- less than -- more than a year ago.
MR. MCLAUGHLIN: Where do you put the cash?
MR. ZUCKERMAN: In your bank, John.
MR. MCLAUGHLIN: Morgan Stanley?
MR. ZUCKERMAN: No, actually, it is --
MR. MCLAUGHLIN: J.P. Morgan?
MR. ZUCKERMAN: It is with commercial banks, because they have the Federal Reserve to back them up.
MR. MCLAUGHLIN: You're holding back, but I'm going to move on, Mort. I'm going to let you off the hook.
MS. CLIFT: That was wretched excess that you just rolled out with all that.
MR. MCLAUGHLIN: Why?
MS. CLIFT: Why? Because nobody should make that much money. And they shouldn't make that much money when they do a bad job. They shouldn't be rewarded for doing a bad job. And in the reportage about the collapse of Washington Mutual, it noted that the CEO, who's only been on the job for 16 days, is getting a multimillion-dollar package. Now, it may be unfair to single him out, but this makes people angry. In Washington we giggle about it and we say, "Oh, the trillions" --
MR. MCLAUGHLIN: Well, it was shown here to slake a certain appetite. Do you understand? (Laughter.)
MR. ZUCKERMAN: Think of all the other shareholders that lost because of the decisions that these people made. MR. MCLAUGHLIN: Quickly, quickly. DO you want to make a point?
MR. LOWRY: I do. Look, he's not bailing out -- he's not in favor of this bailing-out plan to help his friends. Look at the companies they took over. They fired the management. They basically wiped out the shareholders. This is about maintaining the credit markets so everyone else can get capital and the economy can keep going. That is it, John.
MR. MCLAUGHLIN: I agree. I think the Treasury secretary is a noble person.
Issue Three: Bubba's Take.
Hillary as vice president -- did she really want to be Obama's running mate?
FORMER PRESIDENT BILL CLINTON: (From videotape.) Not really, no. She said, "If he asks, I'll do it, because it's my duty." But I think -- look, she loves being a senator from New York, and she has more freedom to develop her positions on the issues.
MR. MCLAUGHLIN: So Hillary was not really keen on being Barack Obama's veep choice, says the ex-president, but adds that it would have been a better move for Obama, quote-unquote, "politically," to have chosen Hillary over Senator Biden.
PRESIDENT CLINTON: (From videotape.) It's a very personal decision who should be vice president. And I like Senator Biden a lot. I think it was a good choice. She would have been the best politically, at least in the short run, because of her enormous support in the country.
MR. MCLAUGHLIN: What about the Hillary women, those 8 million? Will they go over to Obama?
PRESIDENT CLINTON: (From videotape.) Voting is a complicated process. It's not an entirely rational process. And it's different for everybody. There is a woman who's a feminist and a liberal Democrat in the Washington, D.C. area who is, I think, a psychologist, who wrote an article the other day I read saying, "I'm going to vote for Senator McCain because of Palin because I think gender is the dominant factor in American life, and I think that I have to vote this way."
Question: Did McCain make a mistake -- excuse me -- did Obama make a mistake in not putting Hillary on the ticket?
MR. ZUCKERMAN: Oh, for sure. I mean, I think --
MR. MCLAUGHLIN: Is that the biggest mistake he's made? MR. ZUCKERMAN: Well, I think politically, if it had been Hillary, it would have been a walkover, I mean, just a layup. I mean, I don't think there would have been any question about who would have won the election. Now there is -- even yesterday I saw the Gallup daily tracking poll. They're still even at 46-46. On a generic basis, if you had a Democrat versus a Republican, the Democrat would be way ahead.
MR. MCLAUGHLIN: On a different matter, do you think that Bill Clinton, as you saw him here, is helpful to Obama -- (laughter) -- in the race?
MS. CROWLEY: John, with friends like Bill Clinton, Obama doesn't need McCain and the Republicans. Bill Clinton on "The View" spent four minutes singing the praises of John McCain -- what an honorable man of virtue he was, how he was thrilled to work with him when he was president. It's hard to decipher who exactly Bill Clinton is for.
I think he's out there and he's trying to do the blocking for Hillary. There's this Internet rumor that Biden is going to drop off the ticket and Hillary is going to join the ticket in an --
MR. MCLAUGHLIN: Is that rubbish?
MS. CLIFT: Yes.
MR. ZUCKERMAN: It's rubbish.
MS. CLIFT: It's rubbish.
MS. CROWLEY: It's total rubbish. It's not going to happen. It would only happen if Obama really crashed in the polls and he needed a Hail Mary, which is not going to happen.
MS. CLIFT: I don't know if Hillary would have been a better candidate, because --
MR. MCLAUGHLIN: Oh, come, come, come, come.
MS. CLIFT: -- no, because independents are going to decide this election. She's still a polarizing figure, and she wasn't going to win over independents, plus you would have had Bill Clinton to contend with as a really prominent figure. He's still going to help Obama. He's going to campaign --
MR. MCLAUGHLIN: You used to be a good friend of Hillary's, and then you turned on her. I think with you it's not gender --
MS. CLIFT: I have not turned. I am just saying I'm not sure she would have been the better candidate and that Bill Clinton presents problems.
MR. MCLAUGHLIN: Well, is there any doubt there? MS. CLIFT: That is an analytical comment.
MR. MCLAUGHLIN: There is doubt. There is doubt, though, that Biden is the better candidate.
MS. CLIFT: I think Biden will be a good governing partner, and I think Obama is going to win --
MR. MCLAUGHLIN: Do you think Hillary would have been better?
MS. CLIFT: -- and this discussion will be moot.
MR. MCLAUGHLIN: Do you think Hillary would have been better?
MS. CLIFT: Hillary will be terrific on Capitol Hill as a legislative partner.
MR. LOWRY: Listening to Clinton on "The View" explain the VP thing makes me nostalgic for being lied to by Bill Clinton. (Laughter.) He's so good at it. And if you followed him in all these interviews, it'd be enough for a 500-page case study on passive aggression. He doesn't want Obama to win. It's obvious in all the signals.
MR. MCLAUGHLIN: How did the magazine treat Clinton when he was president?
MR. LOWRY: How did ours?
MR. MCLAUGHLIN: Yeah.
MR. LOWRY: Not kindly.
MR. MCLAUGHLIN: National Review. Huh?
MR. LOWRY: Not kindly.
MR. MCLAUGHLIN: Were you running it then?
MR. LOWRY: I was, yeah.
MR. MCLAUGHLIN: The whole thing? The whole time?
MR. LOWRY: Most of the time. No, not even most of the time; part of the time. MR. MCLAUGHLIN: What did Bill Buckley think?
MR. LOWRY: He was not a fan either. I think, in retrospect, the best thing you can say about Bill Clinton, as a conservative, there was extreme caution there. There was a way that he was kind of a small "c" conservative. He was, you know, afraid of intervention --
MR. MCLAUGHLIN: He raises an excellent point.
MS. CLIFT: Good for business.
MR. MCLAUGHLIN: But my point is about --
MR. LOWRY: He was a Robert Rubin type Democrat.
MR. MCLAUGHLIN: He was remarkably conservative.
MR. ZUCKERMAN: He certainly dealt with a lot of issues that you would call centrist in which he did not stay with a typical liberal position, welfare being an example, and the introduction of --
MS. CROWLEY: Free trade.
MR. ZUCKERMAN: Well, free trade, and the introduction of how many thousand policemen? A hundred thousand policemen. So there were a lot of issues --
MR. LOWRY: That was a little bogus.
MS. CLIFT: Those were very good economic times, and especially in contrast to today.
MR. ZUCKERMAN: He was fiscally conservative.
MR. MCLAUGHLIN: I want to close this with Monica. Now, your views on Bill Clinton?
MS. CROWLEY: (Laughs.) Have they changed?
MR. MCLAUGHLIN: Yes.
MS. CROWLEY: A little bit. A little bit. But what's interesting --
MR. MCLAUGHLIN: I thought you adored Clinton.
MS. CROWLEY: No, I never adored Clinton. I still don't adore Clinton. But I find him endlessly fascinating.
MR. MCLAUGHLIN: Yes or no: I predict that in six months the current financial crackup will then be seen not as bad as it looks now. MR. LOWRY: Yes, if the plan passes.
MS. CLIFT: It depends who's looking.
MS. CROWLEY: Yes.
MR. ZUCKERMAN: Yes.
MR. MCLAUGHLIN: The answer is yes.
Don't forget, you can watch the McLaughlin Group anywhere in the world on the Web at McLaughlin.com.