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THE MCLAUGHLIN GROUP HOST: JOHN MCLAUGHLIN PANEL: PATRICK BUCHANAN, MSNBC; ELEANOR CLIFT, NEWSWEEK; MONICA CROWLEY, WASHINGTON TIMES; MORTIMER ZUCKERMAN, U.S. NEWS & WORLD REPORT TAPED: FRIDAY, FEBRUARY 4, 2011 BROADCAST: WEEKEND OF FEBRUARY 5-6, 2011

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MR. MCLAUGHLIN: Issue One: Egypt -- Sphinx Rising.

Protests in Egypt are about to enter a third week. Tens of thousands of Egyptians assembled in downtown Cairo to demonstrate against the Mubarak government. Eighty-three-year-old Hosni Mubarak has ruled Egypt for 30 of those years.

In response to the protests, President Mubarak announced that he would not run for re-election when his current term ends seven months from now. Protesters want more. They want him to step down now. The protests have turned violent. An estimated 3,000 Mubarak supporters joined the demonstration. These Mubarak defenders were allegedly sent by Mubarak himself to disperse the demonstrators. Egyptian soldiers at first stood by as violence broke out between pro-Mubarak and anti-Mubarak forces. Soldiers then fired warning shots in the air, but they did not intervene between the clashing factions. Thus far in Cairo, at least eight people have died and 900 injured.

Here in the United States, President Obama asked President Mubarak to abdicate now.

PRESIDENT BARACK OBAMA: (From videotape.) What is clear, and what I indicated tonight to President Mubarak, is my belief that an orderly transition must be meaningful, it must be peaceful, and it must begin now.

MR. MCLAUGHLIN: Question: President Obama urges President Mubarak to leave office at once. What is President Obama's rationale for pushing Mubarak over the brink? Pat Buchanan.

MR. BUCHANAN: The Obama administration got out in front with the demonstrators and it got too far out in front, John. All that violence that you showed that occurred Wednesday -- the Obama administration has been caught flat-footed, and the tide has begun to turn in favor of the government for these reasons.

Mubarak's guys are in the streets. They've indicated they'll fight to defend him. The army stayed neutral. The Israelis and the Saudis came out and said the Americans are undercutting, stabbing Mubarak in the back, an old friend; they're undercutting him and throwing him under the bus.

Mubarak himself has seemed to indicate that he wants to be there when the next president is inaugurated. And as of now, John, there is no way, in my judgment, those protesters, without the help of the army, can remove President Mubarak if he does not wish to go. I think the army and Mubarak and all the others know that the Mubarak era is over, but they want to see the future era very much like the recent past, where the army and the army's people are really in power. And I think ultimately they may prevail.

MR. MCLAUGHLIN: Eleanor, do you agree with Pat?

MS. CLIFT: No. I agree with parts of what he said. The army is the legitimate and respected institution in the country. And whatever happens next must have the backing of the army. I think the army is divided right now because it's an army of conscripts, and they clearly feel sympathy with the people.

Mubarak has pulled back from an initial display of power. I think people are still nervous about what he's going to do next. I think he's got to go. But in retrospect, it was probably naive to think that he was going to step down quickly. And I'm wondering why, at age 82, he doesn't just accept what's happening and find a graceful exit. And I suspect that's what's happening behind the scenes, the search for that graceful exit.

And I think the president has played it very well. This has been a rapidly changing story, and he has to worry about more than Mubarak's feelings. He has to relate --

MR. MCLAUGHLIN: You don't think --

MS. CLIFT: -- to the Egypt that will be there after Mubarak goes, a population half of which is under age 24.

MR. MCLAUGHLIN: You don't think he moved back from that position on Friday, Eleanor?

MS. CLIFT: He's calling for a transition to begin. And that transition -- I think Mubarak has taken some steps. He installed a vice president, the first --

MR. MCLAUGHLIN: Mm-hmm. (Acknowledging.)

MS. CLIFT: -- of his 30-year regime. And he's made some other steps. Now, whether he can catch up with where the demonstrators are, that moment may have passed.

MR. MCLAUGHLIN: Let me work this in. I'll get back to you.

Okay, President Barack Obama in Cairo, June 2009, six months into his first year. Watch.

PRESIDENT OBAMA: (From videotape.) Now, much has been made of the fact that an African-American with the name Barack Hussein Obama could be elected president. (Applause.) But my personal story is not so unique. The dream of opportunity for all people has not come true for everyone in America, but its promise exists for all who come to our shores. And that includes nearly 7 million American Muslims in our country today, who, by the way, enjoy incomes and educational levels that are higher than the American average.

MR. MCLAUGHLIN: This was unquestionably a fine piece of rhetoric and a good address, a very good address, in Cairo. It was attended by many Egyptian college graduates and other youth who cannot find work today.

Do you think that maybe they cued off him, to some extent? Not that he inspired this kind of rebellion, but he clearly is of color; he's very much of them. He's thoughtful. He's young. And did it have a stimulating effect? If this can be done in the United States, why can't it be done here?

MS. CROWLEY: Well, I think -- I think the power of Obama's example is not to be understated in the idea that he is really the first 21st century international leader. But more so than his personal example, I think, was the message that he gave in Cairo during that speech, was preceded by his predecessor, President Bush, who spoke early and often about the need for political and economic liberalization in the Middle East. That was what the Iraq war was all about as well.

But also, if you're going to talk about the youth, at least in the initial stages of this revolt, leading it, you have to look at the technology, because what existed -- what exists now in terms of Facebook, Twitter, social networking, is playing a huge role, not just in this revolt but the revolt that we saw nearly two years ago that began in Iran.

So I think all of these elements are now coming into play.

MR. MCLAUGHLIN: Do you think there's a redeeming factor in Hosni Mubarak's role? In other words, for the young population and for the whole population of this uprising -- this insurrection, so to speak -- that it wouldn't be where it is today in an uprising position were it not for some of the benefits that they have gained in the 30 years of Mubarak's rule?

MR. ZUCKERMAN: Well, I think that's partially true. I think, if anything, the fact that food prices have gone up dramatically in that part of the world, when you have 40 percent or more of the population making $2 a day or less, really did affect a different side of it, which is that a lot of those people are living at the margins.

And I think there was just a sense, as there is in many of these countries, that the elites and the leadership of Mubarak or around Mubarak have done very well, especially the military. But having said that, he has been a steadfast ally of the United States for 30 years. And the only way -- it is absolutely fair and right to think that this is time for him to leave.

But if you want him to leave, we did it in exactly the wrong way, which is to do it publicly, which is humiliating for an Arab leader. And, of course, therefore, when we sent a special envoy there whose message -- whose mission was leaked, namely that he was going to ask Mubarak to leave, he gave him a very brief meeting and said, "I don't want to talk to you again," because, of course, this man has been around as an ally and expects to be treated as an ally for 30 years. And therefore, it seems to me, we should have found a much better way to get to him.

MR. BUCHANAN: John, this is --

MR. ZUCKERMAN: Now, let me just say -- I want to say one thing. Let's just remember this. In Tehran, there were hundreds of thousands of people in the street. Iran was our principal enemy in that part of the world. And this administration said nothing. But here we take a 30-year ally of the United States and we start publicly attacking him. That was exactly the wrong way to do it in that part of the world.

Now, the Saudis, the Jordanians, most of the other countries are enraged because they feel, in a sense, he was not badly -- he was badly treated and not treated with respect.

MR. BUCHANAN: Mubarak is a soldier --

MR. MCLAUGHLIN: Hold on. I want to pick up that point, because this goes to that.

Okay, now, a big Arab authority, a big one, the secretary general of the 22-nation Arab League, Amr Moussa, said this.

AMR MOUSSA (Arab League secretary general): (From videotape.) The message has been sent. The message has been received. It will never be the same again. I firmly believe that the Arab world, in one year's time, will not be the same as we see it today.

MR. MCLAUGHLIN: In one year's time, the Arab world will not be the same.

MR. BUCHANAN: Exactly.

MR. MCLAUGHLIN: Question: What is the chance that Moussa will run for president himself?

MR. BUCHANAN: Pretty good. Pretty good. He's head of the Arab League. He's a transitional figure. Look, the Mubarak era is over, but Mort is right. This is a soldier, a man of honor. He sent his troops to fight alongside us.

MR. MCLAUGHLIN: You're talking about Mubarak?

MS. CROWLEY: Mubarak.

MR. BUCHANAN: I'm talking about fighting the Gulf war. And here comes this diplomat over there and says, "Hey, get out." They're humiliating him. I think he got his back up, and understandably so.

MR. MCLAUGHLIN: Why did Obama do it? Because he wants to be on the side -- MR. BUCHANAN: Obama got on the -- you're right.

MR. MCLAUGHLIN: Because he knows it's a done deal and he wants to be --

MS. CLIFT: No, come on.

MR. MCLAUGHLIN: -- and he wants to establish his bona fides with the incoming group. Is that it?

MR. BUCHANAN: He went back to his -- basically, if you will, his sort of moderate-left mode. "This is a Facebook-Twitter revolution. I'm part of this."

MS. CLIFT: Oh, come on.

MR. BUCHANAN: He got too far out in front.

MS. CLIFT: You make it sound --

MR. MCLAUGHLIN: I still don't get it. Who are his advisors? Who are Obama's advisors?

MR. BUCHANAN: He advises himself on this one. I think that comes out of his feelings.

MS. CLIFT: You make it sound as if this is some sort of fad. He wants to get on the Twitter bandwagon.

MR. BUCHANAN: He wants to get out in front of things.

MS. CLIFT: Look at all the dictators that this country has stuck with too long.

MR. BUCHANAN: Eleanor --

MS. CLIFT: He has served our purposes well.

MR. BUCHANAN: You don't do that to friends of 30 years.

MS. CLIFT: But he has not served his people very well. He has run a repressive regime.

MR. BUCHANAN: Who are we to decide that?

MS. CLIFT: We're not deciding it. He's deciding it. He's still in power. And this president is giving him a nudge behind the scenes, which is something that he needs.

MR. ZUCKERMAN: Not behind the scenes.

MS. CROWLEY: No, no. MR. ZUCKERMAN: Publicly.

MR. MCLAUGHLIN: Wait. Let Monica --

MS. CLIFT: And he's calling for --

MR. ZUCKERMAN: Publicly.

MS. CLIFT: Well, should he just stand by?

MR. ZUCKERMAN: Now -- when he says now, he means now. And that's not the way to do it, okay?

MS. CLIFT: A transition which has begun.

MR. ZUCKERMAN: I don't think -- he wasn't talking about the transition.

MS. CLIFT: A transition has begun.

MR. ZUCKERMAN: He wanted him to leave now, and we all know it.

MR. BUCHANAN: Right. Right. He's telling him to leave.

MR. ZUCKERMAN: That's right. That's exactly what he's telling him.

MS. CROWLEY: I agree with Mort completely. Look, the administration mishandled this from the beginning. And it's not unlike how they handled --

MR. MCLAUGHLIN: Why? Why?

MS. CROWLEY: -- the Israeli-Palestinian negotiations, which they did in public, and it blew up in their faces. Diplomacy 101 is, especially when you're dealing with a stalwart ally like Hosni Mubarak, is you take this behind closed doors. You don't have the American president give a big declaration.

Look, the other point you raised, Moussa -- Moussa is now the choice, as of this moment, of the Muslim Brotherhood. The Muslim Brotherhood now is working this crisis so that they can ride the tide to seize power. And I'm telling you, if they grab power in Egypt --

MR. BUCHANAN: They're part of the --

MR. MCLAUGHLIN: Hold on. MS. CROWLEY: -- they will consign --

MS. CLIFT: Yeah, they're --

MR. MCLAUGHLIN: Hold on.

MS. CROWLEY: -- they will consign 82 million Egyptians to the perpetual darkness of Islamist rule. And don't make any mistake about it.

MR. MCLAUGHLIN: You mean --

MS. CROWLEY: Let's not be naive about this.

MR. MCLAUGHLIN: Do you remember when the Muslim Brotherhood were the really bad guys over there?

MS. CROWLEY: They are the bad guys.

MR. MCLAUGHLIN: They are the bad guys today?

MR. ZUCKERMAN: Let me --

MS. CROWLEY: Yeah. And I'll tell you --

MR. MCLAUGHLIN: How many Muslim Brotherhood are there?

MR. ZUCKERMAN: They're probably a third of the population.

MR. BUCHANAN: Hamas is part of the Muslim Brotherhood.

MS. CLIFT: And they --

MR. MCLAUGHLIN: How do you account for the fact that the Muslim Brotherhood that were the bad guys are now the good guys?

MS. CROWLEY: They're not the good guys.

MR. ZUCKERMAN: I don't say they're the good guys. Let me tell you --

MR. MCLAUGHLIN: Do they control the strings of power?

MR. ZUCKERMAN: -- Hosni Mubarak --

MR. MCLAUGHLIN: Do they control the strings of power?

MR. BUCHANAN: No.

MR. ZUCKERMAN: No, no. They do not yet. The army controls the strings of power. And this whole issue is going to turn on what the army does. But let me just point out one thing, and Mubarak knows it, okay, because he happened to be sitting next to Anwar Sadat when the Muslim Brotherhood assassinated Anwar Sadat -- MS. CROWLEY: Right.

MR. ZUCKERMAN: -- one of the great figures out of that country. It was the Muslim Brotherhood who assassinated him.

MR. BUCHANAN: John, if there's a democracy --

MR. MCLAUGHLIN: They -- (inaudible) -- him.

MR. ZUCKERMAN: Absolutely. They killed him.

MR. MCLAUGHLIN: Did they do him in?

MR. ZUCKERMAN: They did. They killed him.

MS. CLIFT: If there's a democracy --

MR. MCLAUGHLIN: Did you hear that?

MR. ZUCKERMAN: The Muslim Brotherhood is not a democracy.

MR. BUCHANAN: Democracy -- if their democracy comes -- one man, one vote for Egypt --

MS. CROWLEY: One time.

MR. BUCHANAN: -- let me tell you, the Muslim Brotherhood will initially get 25 to 33 percent of the vote, and the Arab street's views about Israel --

MR. MCLAUGHLIN: Eleanor -- Eleanor, finish this up.

MR. BUCHANAN: -- will be reflected in the government.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: The U.S. approval in Egypt is 12 percent. President Obama cannot be seen propping up a dictator that the people want to go. He's got to deal with the Egypt that remains.

MR. MCLAUGHLIN: Well --

MS. CLIFT: And if it is a diverse democracy that does emerge, the Muslim Brotherhood will have a role.

MR. MCLAUGHLIN: Why did he have to speak at all? Why did he have to speak at all?

MS. CLIFT: And you can't --

MR. MCLAUGHLIN: Sometimes --

MS. CLIFT: If the president said nothing throughout the crisis, you'd all be sitting here criticizing him for that.

MR. MCLAUGHLIN: Sometimes diplomats just shut up.

(Cross talk.)

MR. MCLAUGHLIN: Exit question --

MS. CLIFT: Is this the Mubarak cheering section?

MR. MCLAUGHLIN: The revolts in Tunisia and Egypt have irrevocably altered the Arab world. I think we all believe that. Are these revolts in Tunisia and Egypt part of a broader worldwide pattern of instability and radical political change caused by the world economic crisis? Isolated or global -- what do you think, Pat?

MR. BUCHANAN: No, my view is the Tunisian thing started off. I think currently it is in the Arab and Islamic world, John. But I'll tell you, to the degree that they have democratic elections in the Arab world, they will vote to sever ties with America and they will vote to be hostile to Israel, because that is the mood of the entire Arab-Islamic world.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: I don't agree with that at all. MR. MCLAUGHLIN: Is it world economic pressure?

MS. CLIFT: I think Mubarak has stayed in power because of all this demonization of the elements within his society. And there have got to be other voices that have come out, and we've seen them in the streets.

And in terms of what's caused this, it's not just economic woes. It's a case of rising expectations. People see, through Twitter and Facebook and everything else, there's another world out there. And the regime that Mubarak crushed his people with has to come to an end.

MS. CROWLEY: I think that we in the West have fallen into a trap of romanticizing what the Arab street would want if they were given true democracy as we understand it, because when you look at recent polls of the Egyptian people, 75 percent say they would like Islamic law. They would like Sharia. Sixty-five percent say they would like the reinstitution of the Islamic caliphate. When we talk about democracy, it is not going to be a Jeffersonian democracy. It is going to be one vote, like we saw in Gaza with Hamas -- one man, one vote, one time.

MR. MCLAUGHLIN: Let me ask you this, Mort. If the world -- Egypt, of course, included; the United States included -- were not in an economic crisis -- crisis is too strong a word -- we were not in this economic crunch that we're in -- the world is in it -- do you think that this revolt against --

MR. ZUCKERMAN: Mubarak.

MR. MCLAUGHLIN: -- Mubarak would have occurred?

MR. ZUCKERMAN: You know, it's very hard to judge. I do think that the last time there was this kind of uprising in Egypt, it was again when food prices went up, because it so dramatically affects them. And that is not directly a result of the financial crisis. So I'm not sure it's the financial crisis that produced it.

Undoubtedly, it contributed to it to some extent. But I think the real issue there was very simply it is the fact that you had a despotic regime. They did tend to take a lot of, shall we say, the wealth of that society for a small group. That was apparent to a lot of people. And at some point they just revolted. Tunisia was an example. The social network contributed to it. The food prices contributed to it. A whole series of things contributed to it.

MR. MCLAUGHLIN: I think if the world were not in the economic crunch, which is felt particularly in countries like Egypt, I think Mubarak would probably have made it over the hump.

Issue Two: Happy 100th, Gipper. PRESIDENT RONALD REAGAN: (From videotape.) We go forward today a nation still mighty in its youth and powerful in its purpose. With our alliances strengthened, with our economy leading the world to a new age of economic expansion, we look to a future rich in possibilities.

MR. MCLAUGHLIN: The great communicator, the Gipper, Ditch, the teflon president, Ronald Wilson Reagan. This Sunday marks the 100th anniversary of Ronald Reagan's birth.

Born: February 6, 1911, Tampico, Illinois.

Marriage: Jane Wyman, 1940; divorced, 1949. Three children with Wyman: Daughter Maureen, who died in 2001, and daughter Christine, who died in infancy, and adopted son Michael.

Marriage: Nancy Davis, 1952. Two children with Nancy Davis -- today an active grandmother, by the way -- son Ronald Prescott Reagan and daughter Patti Davis Reagan.

Religion: Chiefly Presbyterian.

Political party: Democrat, 1932 to 1962; Republican, 1962 to 2004.

College: Eureka College, B.A.

Radio, '32 to '37; film acting, '37 to '65; Screen Actors Guild, board of directors, '41 to '47; Screen Actors Guild president, '47 to '52 and '59.

Campaign for Republicans Dwight Eisenhower, Richard Nixon, Barry Goldwater for president, '52, '56, '60 and '64.

Governor, California, '67 to '75.

Republican presidential nomination, ran unsuccessfully twice for, '68 and '76.

U.S. president, '81 to '89, defeating one-term incumbent President Jimmy Carter.

Died June 5, 2004, 93 years of age, Bel Air, California.

As president, Ronald Reagan tackled historically high inflation and unemployment. During his presidency, inflation dropped from 12.5 percent to 5.5 percent and unemployment dropped from 9.7 percent to 4.4 percent. Reagan launched a defense buildup against the Soviet Union that helped end communism and the Cold War.

Question: What characteristics did Ronald Reagan possess that other postwar presidents have lacked? Pat, you worked for Ronald Reagan.

MR. BUCHANAN: Extraordinary communicator, enormous optimism, a pre-World War II depth of belief in the goodness and greatness of his country that can't be replicated by any postwar generation, a man who had great convictions, the courage of those convictions. He would often say, "Well, if this doesn't work out, I can always go back to the ranch and chop wood."

MR. MCLAUGHLIN: He never knocked the United States.

MR. BUCHANAN: Oh, he loved --

MR. MCLAUGHLIN: He never found fault with it.

MR. BUCHANAN: He was always -- America was great. It was an ideal in his mind. And the idea that the communists could ever defeat America was just beyond his conception.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: Well, and along to introduce a little reality into sometimes his sunny idealism was his wife. And I would like to say some nice words about her. She's still very much with us. And she encouraged him to meet with the Soviet leaders, and he had to -- she had to overcome a lot of the conservatives within the White House. You were probably one of them, Pat. And she was a force for moderation within the White House.

MR. MCLAUGHLIN: Yeah.

MS. CLIFT: And we've seen her on that path since she's left the White House as well, championing stem-cell research.

MS. CROWLEY: The reason I'm a conservative is because of Ronald Reagan, because I was very, very young when he was president of the United States. But everything he stood for just instinctively struck me as correct. And what I found so amazing about Reagan is that he was unafraid to stand for his conservative principles.

MR. MCLAUGHLIN: Mort.

MR. ZUCKERMAN: Well, I worked with him for a four-week period at one point, and I found, to my astonishment, every issue that came up, he got the point right away. He was very, very decisive. And he had the capacity to inspire this country and rebuild the confidence of this country in its future after a couple of very, very difficult years from the preceding president. He was a wonderful man, an extraordinary man.

MR. MCLAUGHLIN: Issue Three: Bulls in Motion. The economics just came out, and the bulls are loping, if not running.

Daily index. Stock market up, breaking 12,000 this week.

Monthly index. Item: Unemployment down four tenths of a percent, 9.4 percent in December to 9.0 percent in January.

Yearly index. Item: Consumer spending, 2010, up 3.5 percent. Item: Household income, 2010, up 3 percent. Item: GDP growth, 2010, up 2.9 percent.

Question, Mort: How upbeat are these statistics?

MR. ZUCKERMAN: Well, the one that is upbeat is the stock market, but that's a reflection of not only corporate America cutting costs, which means cutting employment, but also very, very, low interest rates pushed forth by the Federal Reserve.

I think our economy is very weak. We have virtually no recovery in terms of employment. It's about literally one third the normal rates of increases in employment in the first four quarters after the bottom of a recession. So this economy is growing very slowly. The unemployment numbers for January were very weak. The housing numbers are very weak. We're not out of the woods.

MR. MCLAUGHLIN: Jobless recovery? Jobless recovery?

MR. ZUCKERMAN: We have created roughly 90,000 jobs a month for the first year coming out of the recession. That is not enough to equal the number of people who come into the labor force every month.

MR. MCLAUGHLIN: Is Bernanke's QE II policy, quantitative easing II, is that going to contribute in any way to easing it, or is it not working, or what?

MR. ZUCKERMAN: Well, we have had the biggest fiscal stimulus and the easiest monetary policy in the history of this country, and we still have had this very, very minor level of growth.

MR. BUCHANAN: It's not working, John.

MR. ZUCKERMAN: It's not working.

MR. BUCHANAN: It is not working.

MR. ZUCKERMAN: Well, nothing is working yet.

MR. BUCHANAN: It is an anemic recovery. It is an anemic recovery.

MR. ZUCKERMAN: Nothing -- it's a very anemic recovery. MS. CROWLEY: The economic indicators are a very mixed bag. But when you look at the two primary pillars that have political resonance as well as economic resonance, you look at unemployment and you look at the housing sector. And in both of those situations, we are facing still very dark days.

I mean, you look at this unemployment number. Yes, the official rate went down to 9.0 percent, but that's because so many left the job search. In fact, from December to January, the number of people who stopped looking for work actually went up from 2.6 million to 2.8 million. They're just totally and utterly discouraged.

You look at the housing sector as well and the housing prices continue to collapse around the country. And without recovery in housing, you're not going to get recovery in any other sector.

MR. MCLAUGHLIN: There's been a lot of talk in Congress about overhauling the tax code. Do you think overhauling the tax code would relieve this economic situation --

MR. BUCHANAN: I think the tax code --

MR. MCLAUGHLIN: -- to take away the joblessness of it?

MR. BUCHANAN: I think the tax code should be overhauled. I think the corporate tax needs to be brought down. I think you can get rid of a lot of these loopholes and that. But that won't work immediately, John. We are -- Obama is heading into -- basically into the second half here, and this is a surprisingly anemic recovery. A lot of us thought we'd be doing better. It sounded like it was doing good.

MS. CLIFT: Well --

MR. MCLAUGHLIN: Are you giving adequate consideration to Obama's green-energy underwriting subsidy?

MS. CROWLEY: Oh, come on, John.

MR. BUCHANAN: I don't think --

MS. CLIFT: While we're all --

MR. MCLAUGHLIN: You don't think that's a good idea? What's he pumping into that, $5 billion?

MS. CLIFT: Well, while we're all --

MR. BUCHANAN: We've got --

MR. MCLAUGHLIN: Won't that turn it around? MR. ZUCKERMAN: No.

MS. CROWLEY: No.

MR. BUCHANAN: Five billion dollars is peanuts.

MS. CLIFT: While we --

MR. ZUCKERMAN: This is a recession that was provoked by a financial crisis. Every other recession we've had since the end of World War II was caused by excess inventory or excess plant and equipment.

MR. MCLAUGHLIN: What about --

MR. ZUCKERMAN: These are twice as deep --

MR. MCLAUGHLIN: What about the windmills, Eleanor? Will the windmills help us?

MR. ZUCKERMAN: It's a lot of hot air is what they're going to help with.

MR. BUCHANAN: The Chinese build them.

MS. CLIFT: Well, while we're all --

MR. MCLAUGHLIN: What about the batteries? The batteries.

MS. CLIFT: While we're all yammering about Mubarak's future, the president is traveling to all of these places around the country talking up all of the initiatives --

MR. MCLAUGHLIN: GE. GE.

MS. CLIFT: -- that you just mentioned. And he's got the GE guy, Mr. Immelt, at his side.

MR. BUCHANAN: And who builds --

MR. MCLAUGHLIN: Has he got GE investing in green?

MS. CLIFT: Hope is on the way.

MR. BUCHANAN: Who builds the windmills? The Chinese are building the windmills -- MR. MCLAUGHLIN: (Laughs.)

MR. BUCHANAN: -- and selling them to us.

MR. MCLAUGHLIN: They're stealing our green-energy market.

What's the story?

MS. CROWLEY: Well, when you're talking about wind and solar, you're talking about massive government subsidies --

MR. MCLAUGHLIN: Forget green.

MS. CROWLEY: -- going into these sectors. The private sector --

MR. MCLAUGHLIN: What is going to stimulate --

MS. CROWLEY: -- has got to be the sector that will pull us out of this.

MR. ZUCKERMAN: I'll tell you what --

MR. MCLAUGHLIN: I want to know how bad conditions really are.

MR. ZUCKERMAN: Conditions are very weak. And none of our fiscal programs have worked. We're going to need a massive infrastructure program that is going to take some time to put into effect in order to rebuild the economy.

MR. MCLAUGHLIN: Spoken by a true man of the people.

MR. ZUCKERMAN: I've believed that for a long time.

MR. MCLAUGHLIN: These photos speak for themselves. We are honored to note that Ronald Reagan was a fan of the McLaughlin Group. In 1985, President Reagan took the podium at the McLaughlin Group's third-anniversary salute, photographed here. Also the president invited the Group to the White House for a friendly chat about current events. The informal session ran just under an hour.

END.