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The McLaughlin Group Host: John McLaughlin Panel: Pat Buchanan, MSNBC; Eleanor Clift, Newsweek; Rich Lowry, National Review; Mort Zuckerman, U.S. News & World Report Taped: Friday, December 16, 2011 Broadcast: Weekend of December 17-18, 2011

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JOHN MCLAUGHLIN: Issue One: The Big Mo.

REPRESENTATIVE RON PAUL (R-TX): (From videotape.) There's so much frustration, and people are hopping around. They're looking for somebody. And I think, quite frankly, that might be the reason we're going up in the polls.

MR. MCLAUGHLIN: Momentum. Republican presidential candidate Ron Paul has it -- the big mo. The libertarian candidate who is running on the Republican label, Dr. Paul is now positioned to win the Iowa caucuses because Iowa Republicans remain dissatisfied, many believe, with Republican contenders, notably Romney and Gingrich. Republican voters see Gingrich as zany and Romney as inconsistent. The Iowa caucuses, less than three weeks away, January 3, are closed caucuses, limited only to registered Republicans; i.e., GOP's true believers. That gives Dr. Paul the inside track.

Also this: One, ground support. Politicians in the state say that Paul has the best ground campaign. That means he will turn out his vote -- reminder phone calls, car pickups and returns, helping registration, et cetera.

Two, money. Paul this year has raised $13 million. Only Mitt Romney, with $15 million, and Rick Perry, with $17 million, have raised more, marginally.

Three, advertising -- tough, close-to-the-bone claims. Here's his ad against Newt Gingrich, branding him with, quote-unquote, "serial hypocrisy."

(Begin videotaped segment.)

JOAN WALSH (Salon.com): He's flipped and flopped based on who's paying him.

MR. : He's demonstrating himself to be the very essence of the Washington insider.

MR. : It's about serial hypocrisy.

(End videotaped segment.)

MR. MCLAUGHLIN: As for Governor Romney, here's the Paul take on him.

ANNOUNCER: (From videotape.) Mitt Romney, who is praised by Barack Obama for his Massachusetts health care program.

MR. MCLAUGHLIN: And here's the knock on Governor Perry from Ron Paul, M.D.

ANNOUNCER: (From videotape.) Rick Perry, who applauded Hillary's health care plan and forced young girls in Texas to be injected with an STD vaccine.

MR. MCLAUGHLIN: Question: Does the first-place showing in Iowa mean winning the nomination? Pat Buchanan.

PAT BUCHANAN: For Ron Paul? No, it does not, John. But a first-place showing in Iowa for Ron Paul, which is a real possibility, would blow Newt Gingrich's surge right out of the water. Gingrich would then get his first opportunity to win in South Carolina. And even if he won that, he might not get the nomination. This would be dynamite, John, because Ron Paul would get enormous national attention. He would rise in New Hampshire, not to the point where he could beat Romney, but he would wipe out Newt Gingrich there. I think the strategic asset of Mitt Romney right now is Ron Paul, and I'm sure a lot of Romneyites are go, Ron, go.

MR. MCLAUGHLIN: Eleanor.

ELEANOR CLIFT: I don't think it's Ron Paul's intention, but he is serving the Republican establishment that really wants to slow or stop Newt Gingrich. If Ron Paul wins in Iowa, everybody will say, isn't that nice, but he's not going to be the nominee.

There are two things you can say about Ron Paul, though. He's consistent and he's principled. And once you understand those principles, you understand how he can be for legalizing marijuana and for not doing everything possible to stop Iran from getting a nuclear weapon. He believes in virtually no government. He would dismantle the current government by 80 percent. He is a libertarian.

MR. MCLAUGHLIN: What about the conservative establishment? We've heard about the Republican establishment. You can speak to that. As a matter of fact, you can reflect on the cover of your magazine, which I'm putting on the screen right now. That's a caricature of Newt Gingrich.

RICH LOWRY: It is --

MR. MCLAUGHLIN: What are you saying about Newt Gingrich?

MR. LOWRY: -- as Marvin the Martian.

We come out very strongly against Newt. We think he's just such a high-risk nominee for not enough reward if he actually would become president, from a conservative perspective, because if there is anyone in this field who might wake up as president and one day just decide he's going to cut some grand bargain with Nancy Pelosi, it is Newt Gingrich. He is just not reliable enough as a candidate or as a potential president.

MR. MCLAUGHLIN: Why is he so unreliable?

MR. LOWRY: He's just erratic by nature. And, you know, he likes to say he's sort of aged out of all that. He's 68 years old. But you just look at the last couple of years. He was against TARP; then he was for it. He was for the Libya no-fly zone; then he was against it. Paul Ryan's Medicare reform was social -- radical social engineering; then it wasn't; and on and on.

And just lately, John, he admitted that when he accused Mitt Romney of bankrupting companies in some shameful way, he admitted he shouldn't have said that and that the Romney aides got inside his head and he reacted in the wrong way. You just cannot have a general- election candidate in a high-intensity race against President Obama doing that kind of thing.

MR. MCLAUGHLIN: Mort.

MORT ZUCKERMAN: Yeah, I mean, I think that's absolutely correct. I think there is a growing sense, as people begin to focus in on Newt, that there's a kind of unreliability or a kind of erratic quality --

MR. MCLAUGHLIN: Zany?

MR. ZUCKERMAN: Well, zany is a good word. Any name that begins with a Z can't be all bad, as far as I'm concerned. (Laughter.)

But I really do think that, you know, there was a moment there, because Newt was very effective as a debater, and this whole process of selecting a candidate based on how they debate is kind of a bit weird in the first place. But I do think now that the real world is coming in on him. And Ron Paul's escalation in this thing, frankly, is a reflection of that. There is a movement away from Gingrich because they don't think he's quite that reliable. And the conservatives are moving over to Ron Paul.

MR. MCLAUGHLIN: Where did Paul place in the Iowa straw poll?

MR. LOWRY: Second.

MR. BUCHANAN: He placed number two --

MR. LOWRY: A very strong second.

MR. BUCHANAN: -- very, very close; about 150 votes --

MR. ZUCKERMAN: About 150 votes behind --

MR. MCLAUGHLIN: Who?

MR. ZUCKERMAN: -- Michele Bachmann.

MR. MCLAUGHLIN: Michele Bachmann placed number one.

MR. BUCHANAN: Yeah, but it shows Ron Paul this time, John, has an outstanding organization -- energy, fire, youth, a lot of people coming in. Forty-five hundred votes in an Iowa straw poll, John, is extraordinary.

MS. CLIFT: Well, it's essentially --

MR. MCLAUGHLIN: In 2008, who placed second in the straw poll?

MR. BUCHANAN: Who placed second? Mitt Romney placed second in the straw poll.

MR. MCLAUGHLIN: In 2008?

MR. BUCHANAN: Yeah, because --

MR. MCLAUGHLIN: I thought it was Huckabee.

MR. BUCHANAN: Huckabee was number one.

MR. LOWRY: Huckabee, a surprise finish.

MR. MCLAUGHLIN: Huckabee placed second in the Iowa straw poll.

MR. BUCHANAN: He was number one.

MS. CLIFT: He won. He won the Iowa straw poll.

MR. MCLAUGHLIN: In 2008.

MR. BUCHANAN: Yeah.

MS. CLIFT: The thing is --

MR. MCLAUGHLIN: In the straw poll.

MR. BUCHANAN: Oh, in the straw poll.

MS. CLIFT: The straw poll.

MR. MCLAUGHLIN: Yeah.

MR. BUCHANAN: Romney won the straw poll.

MR. MCLAUGHLIN: Romney won and Huckabee placed second.

MR. LOWRY: Huckabee was a strong second.

MR. MCLAUGHLIN: And then Huckabee went on and he won what?

MR. BUCHANAN: The caucuses.

MR. MCLAUGHLIN: He won the caucus in Iowa.

MR. BUCHANAN: Caucuses, yeah. MS. CLIFT: It's essentially a three-way tie. But I wouldn't discount Michele Bachmann. She had a very strong performance in the debate over the weekend, and she has an organization. She's on a bus tour visiting all 99 counties. She's another place you can go if you don't want Romney and you're wary of Newt Gingrich.

MR. LOWRY: For Romney --

MS. CLIFT: There's a lot good to be said about Newt Gingrich, though. He'd deliver a really interesting campaign about a lot of ideas, like increasing the health budget so we can solve Alzheimer's, space colonies.

MR. MCLAUGHLIN: Yeah.

MS. CLIFT: And some things sound bizarre, but the guy really does think outside the box.

MR. LOWRY: That's for sure.

MS. CLIFT: And Romney is a total automaton. (Laughs.)

MR. BUCHANAN: (Laughs.)

MR. LOWRY: For Romney, the ideal result in Iowa, obviously, is winning it. But if he can't do that, anyone besides Gingrich winning Iowa is good for Mitt Romney, especially if it's Ron Paul.

MR. MCLAUGHLIN: Here's a little bit of history. George Bush beat Ronald Reagan in Iowa in 1980.

MR. BUCHANAN: Right.

MR. MCLAUGHLIN: Right?

MR. BUCHANAN: Right.

MR. MCLAUGHLIN: We saw what happened then.

MR. BUCHANAN: Well, Reagan came back and beat him by 20 in New Hampshire.

MR. MCLAUGHLIN: Yeah. So the win by George Bush in 1980 didn't do anything for him as far as the general election was concerned --

MR. BUCHANAN: Right.

MR. MCLAUGHLIN: -- as far as winning. Mike Huckabee beat John McCain in Iowa in 2008. Winning in Iowa gives a candidate momentum, a fundraising boost.

MR. BUCHANAN: McCain didn't -- MS. CLIFT: McCain didn't contest.

MR. BUCHANAN: -- play. McCain didn't play.

MS. CLIFT: He didn't really contest.

MR. MCLAUGHLIN: He didn't play. What do you mean, he didn't play?

MR. LOWRY: Huckabee beat --

MR. MCLAUGHLIN: He stayed out. He stayed in New Hampshire.

MR. LOWRY: Huckabee beat Romney. And this --

MR. MCLAUGHLIN: Huckabee beat Romney --

MR. LOWRY: And this is why Iowa --

MR. MCLAUGHLIN: -- in 2008?

MR. LOWRY: -- Iowa is high risk and potentially high reward for Romney, because if he finishes first, the nomination could be over in a couple of weeks. But if he finishes fourth or fifth, he's going to have a significant downdraft in New Hampshire, just the way he did in `08. And that's a doomsday scenario, potentially, for him.

MR. MCLAUGHLIN: What kind of a bellwether is Iowa? Is it reliable or unreliable as far as the nomination is concerned? The answer is it's deeply unreliable.

MR. ZUCKERMAN: It's unreliable. That's correct. But --

MR. MCLAUGHLIN: So why are we getting so excited about it?

MR. ZUCKERMAN: I was going to ask you that very same question, John.

MR. BUCHANAN: But it's enormously important, John.

MS. CLIFT: Because it --

MR. MCLAUGHLIN: Well, it's enormously important because --

MR. BUCHANAN: Take Huckabee. Take Huckabee beating Romney there. Huckabee then goes on to win South Carolina. If Romney had won Iowa, I think Romney would have been the nominee in 2008, John. He just didn't beat him, and then he didn't win New Hampshire and he didn't win South Carolina.

MS. CLIFT: It has --

MR. MCLAUGHLIN: What do you think of Eleanor, now, boosting the importance of the gal who's in the race? What do you think of -- how do you think of that?

MR. BUCHANAN: I think she's got a point. I mean, that gal --

MR. MCLAUGHLIN: Do you think she's got a point, or --

MR. BUCHANAN: -- won the Iowa straw poll. But I think she's starting from too low a base now.

MR. MCLAUGHLIN: You don't think that's mischief on Eleanor's part, do you?

MR. BUCHANAN: No, I would think -- I would bet she gets between 12 and 15 percent.

MR. MCLAUGHLIN: Pushing Bachmann? (Laughs.) You want Bachmann to be the nominee?

MS. CLIFT: No, but I think Bachmann could -- while the other guys are fighting among themselves, that she has a shot here. She's very well organized there. And she's another holding position if you don't like the others.

MR. LOWRY: And she's a hugely -- a hugely effective debater. She's become the prosecutor in chief in these debates. She's fiery and fearless.

MR. MCLAUGHLIN: You're talking about the last one. We've had, what, 16 of these?

MR. LOWRY: But you saw her going right after Newt.

MR. BUCHANAN: She cut Newt --

MR. LOWRY: And you saw Newt showing way too much irritation.

MR. BUCHANAN: She cut Newt to ribbons in that debate out there in Sioux City -- cut him to ribbons.

MS. CLIFT: Well, she --

MR. MCLAUGHLIN: You're talking about Saturday night.

MS. CLIFT: Yeah. MR. BUCHANAN: I'm talking about Thursday night.

MS. CLIFT: She burned him on the money from Freddie Mac, saying he was influencing the Republican establishment so that they could keep up the scam in Washington, D.C. But her facts -- she has -- she was correct on that, but she has a lot of facts that are wrong that she asserts are right. And so, you know, she's not presidential material, but she can do the mischief you're accusing me of doing. (Laughter.)

MR. MCLAUGHLIN: Let's talk about the polling in Iowa, the polling, the current polling in Iowa today. The most recent poll I've seen is by Rasmussen on December the 13th.

MR. BUCHANAN: Right.

MR. MCLAUGHLIN: OK? Of 750 likely voters, Romney leads by three points. Paul is in third place. What do you think of that?

MR. ZUCKERMAN: That happens, OK? That's going to be pretty much the end of the Republican nomination fight, because I think if Romney wins in Iowa, he's going to win in New Hampshire. He's going to have enough momentum to carry him through. That, I think --

MR. MCLAUGHLIN: Is that the best diagnostic we have?

MR. BUCHANAN: No, no. John --

MR. ZUCKERMAN: With 750 people, you can't really tell.

MR. BUCHANAN: John, Romney wins --

MR. MCLAUGHLIN: It's three weeks away.

MR. BUCHANAN: Hey, John --

MR. ZUCKERMAN: Hey, it's --

MR. BUCHANAN: John, if Ron Paul wins, Romney wins. If Romney wins, Romney wins. But if Newt wins, Romney's got problems.

MS. CLIFT: (Laughs.) Right.

MR. LOWRY: That Rasmussen poll is interesting, John, because he was the first pollster out in Iowa to pick up the Newt surge. He had Newt popping up to 32, way before anyone else. So maybe he is picking up the diminishment of Newt's momentum.

MR. MCLAUGHLIN: I'm going to put you in charge of watching the Rasmussen poll, OK?

MR. LOWRY: (Laughs.) MR. MCLAUGHLIN: Issue Two: Out of Iraq.

PRESIDENT BARACK OBAMA: (From videotape.) In the coming days, the last American soldiers will cross the border out of Iraq with honor and with their heads held high. After nearly nine years, our war in Iraq ends this month.

IRAQI PRIME MINISTER NOURI AL-MALIKI (through interpreter): (From videotape.

) Iraq had a political process established, a democratic process, and adoption of the principles of elections and the transfer -- peaceful transfer of authority.

MR. MCLAUGHLIN: President Barack Obama this week hosted Iraq's prime minister, Nouri al-Maliki. The meeting took place to mark the end of the war in Iraq. This was in Washington on Monday. Here is the president on Wednesday in Fort Bragg, North Carolina -- 50 miles south of Raleigh, by the way -- welcoming U.S. military back from Iraq.

PRESIDENT OBAMA: (From videotape.) So as your commander in chief, and on behalf of a grateful nation, I'm proud to finally say these two words, and I know your families agree: Welcome home. (Cheers, applause.) Welcome home. Welcome home.

MR. MCLAUGHLIN: OK. In Baghdad this week, on site, U.S. Defense Secretary Leon Panetta shut down the U.S. military campaign. Secretary Panetta saluted the American soldiers who were lost in Iraq.

DEFENSE SECRETARY LEON PANETTA: (From videotape.) Those lives have not been lost in vain. They gave birth to an independent, free and sovereign Iraq.

MR. MCLAUGHLIN: Question: Are we leaving Iraq voluntarily, or were we thrown out? Eleanor Clift.

MS. CLIFT: A little bit of both. The Obama campaign has already done an ad saying, "Promise kept." This president ran on getting us out of Iraq, and he's kept that promise. So, yes, we got out because it was time and we wanted to. But we also wanted to leave a residual force behind, and we couldn't negotiate with the Iraqis that they would accept that. And it's Prime Minister Maliki's political problem. He could not accept that. After nine years, there's a lot of anti-American sentiment. They are not grateful for us having liberated them, by any means.

MR. MCLAUGHLIN: Isn't that something?

MS. CLIFT: They're -- well --

MR. MCLAUGHLIN: Isn't that something? They're not grateful. MS. CLIFT: It's totally understandable. But they didn't want us there. And there's a great deal of concern that Maliki spent a lot of time in exile in Iraq, that Iran and Iraq are going to become aligned, and that that free, independent Iraq that President Bush envisioned and that this administration would like to see is not going to come into being.

MR. MCLAUGHLIN: What do you think, Pat, now that we've taken care of Saddam Hussein? That's gone. And Iraq is sovereign.

MR. BUCHANAN: I agree with Eleanor to a great degree. First, it's -- I think it was just disgraceful that neither the president of Iraq nor the prime minister went out there to see the American troops off. We are coming home because Barack Obama is fulfilling Bush's pledge. He didn't like the war. He's bringing us home.

But there's a real danger, one, that the Kurds could break apart from Iraq. They're already seizing Kirkuk. It could be a collapse of the government. There could be a renewal of sectarian war. We got no guarantee of anything in there. And in my judgment -- I agree with the late General Bill Odom, who was head of NSA -- this was the worst strategic mistake the United States ever made.

MR. MCLAUGHLIN: Let me pick that point up with this. Now the Washington political establishment -- the ranking member of the Senate Armed Services Committee, John McCain, takes issue with the president's decision to bring all the troops home.

SENATOR JOHN MCCAIN (R-AZ): (From videotape.) It is clear that this decision of a complete pullout of United States troops from Iraq was dictated by politics and not our national security interests. I believe that history will judge this president's leadership with the scorn and disdain that it deserves.

MR. MCLAUGHLIN: What do you think of those apples? I ask you, Rich.

MR. LOWRY: Well, I think he's basically right. I think we wanted to get kicked out. There wasn't much of an effort by President Obama or Vice President Biden to make this thing work. Biden suggested in a news interview recently, actually, that if the Iraqis had asked us to keep 20,000 troops there, we wouldn't have stayed.

And I think, whatever you think of this war, a complete and utter withdrawal that risks washing away of our gains is a historic mistake. Having a presence there, one, it reassured Maliki that he wasn't going to get assassinated and it reassured the Sunnis that they weren't again going to be the victims of horrific sectarian bloodletting. Both of those assurances now are gone. And I fear what the consequences are going to be.

MR. MCLAUGHLIN: Let me ask you this, Mort. MS. CLIFT: That's fantasy. (Laughs.)

MR. MCLAUGHLIN: Let me ask Mort this. Is Iraq likely to be -- to turn out to be an instance of winning the war but losing the peace?

MR. ZUCKERMAN: Well, there's a very serious chance of that, because Maliki is a Shia, and he is much closer to Iran -- has been; spent much time in Iran, got a lot of financing from Iran, gets a lot of help subterraneously from Iran in terms of keeping his position in that country.

And I think the real danger there is that if you get -- you could have a sectarian war between the Sunnis and the Shias. But even if you don't, I think there's going to be an alliance between Iraq and Iran that is going to be very much to the detriment of the national interest of the United States. And there's nothing much we can do about it.

MR. BUCHANAN: John, we've got 15 --

MR. MCLAUGHLIN: Let me ask you a question.

MR. BUCHANAN: We've got 15,000 guys in there, John.

MR. MCLAUGHLIN: Do you think the war in Iraq was justified?

MS. CLIFT: I don't think the war in Iraq was justified, no. And this president has taken him three years to clean up the mess, to the best of his ability. I just wish he'd been as successful with --

MR. MCLAUGHLIN: Not justified on moral grounds --

MS. CLIFT: -- cleaning up the economy.

MR. MCLAUGHLIN: -- or not justified on strategic grounds?

MR. BUCHANAN: John --

MR. MCLAUGHLIN: Just a moment.

MS. CLIFT: On either way. You don't invade another country --

MR. MCLAUGHLIN: Well, you lose 4,500 --

MS. CLIFT: -- because you think they have some --

MR. MCLAUGHLIN: You also take the lives of 4,500 soldiers and about 100,000 civilians.

MS. CLIFT: And probably 100,000 Iraqis. It's a moral blemish on this country, and it's also a strategic -- MR. BUCHANAN: John --

MS. CLIFT: -- error.

MR. MCLAUGHLIN: You think the whole history -- the whole history of Iraq is saying, war, we've grown accustomed to your face? In other words, instead of war being treated as intrinsically evil and only necessary in instances of national security, it is not justified, no matter how exalted your motives are, like sovereignty for Iraq? It does not call for Americans to go in there and lose their lives --

MS. CLIFT: Right. I think some wars are justified.

MR. MCLAUGHLIN: -- 4,500. What about that?

MS. CLIFT: World War II was justified.

MR. BUCHANAN: Hold it, John.

MR. MCLAUGHLIN: Wait a minute. I want to get him in.

MR. BUCHANAN: By what moral right did we attack this country, which had not attacked us, did not threaten us --

MR. MCLAUGHLIN: Well --

MR. BUCHANAN: -- did not want war with us?

MR. MCLAUGHLIN: They had a terrible dictator, they believed.

MR. BUCHANAN: Well, look, there's a terrible dictator --

MR. MCLAUGHLIN: It was Saddam Hussein.

MR. BUCHANAN: There's one in --

MR. MCLAUGHLIN: Do you remember Saddam Hussein?

MR. BUCHANAN: There's one in Zimbabwe. Have we got a right to attack them?

MR. MCLAUGHLIN: Right. Right.

MR. BUCHANAN: We can go in there --

MR. MCLAUGHLIN: We cannot go around the war making war --

MR. LOWRY: We had a history --

MR. MCLAUGHLIN: -- because it weakens the concept of war, the reality of war, which is evil. And it's only made justifiable when there's a national security -- is there any national security involved in Iraq? Was there ever? MR. BUCHANAN: No. We had the guy in a box.

MS. CLIFT: I think --

MR. MCLAUGHLIN: We had the guy in a box? He was hiding down in a sewer.

MR. LOWRY: He was getting out of the box.

MS. CLIFT: I think even people today, conservatives today, who think we should stay in Iraq, think we made a mistake going in and we made a mistake in how we prosecuted that war.

MR. LOWRY: Look, this was a vicious dictator. That wasn't just a random belief. That was a fact. The sanctions regime --

MR. MCLAUGHLIN: This is true, but --

MS. CLIFT: It's a vicious dictator we worked with.

MR. LOWRY: Hold on. Hold on.

MR. MCLAUGHLIN: -- that's not a threat to our national security. There are a lot of vicious dictators around. That's Pat's point.

MR. LOWRY: I know. Can I make a few other points, please?

MR. MCLAUGHLIN: Yes. Please do.

MR. LOWRY: The sanctions regime was fraying because Saddam was buying off all the people who were supposed to impose it on him. We thought he had a weapons program.

MR. ZUCKERMAN: Right.

MR. LOWRY: There was a bipartisan consensus in this country in favor of the war. Even Democrats voted for it. The big mistake was not a proper postwar strategy. It hadn't been thought through. If we had instituted a population control strategy from the beginning and hadn't disbanded the army --

MR. MCLAUGHLIN: Yeah, once you get inside --

MR. LOWRY: -- it might have looked a lot different.

MR. BUCHANAN: What was the moral --

MR. MCLAUGHLIN: -- the war game, you're playing that armchair general kind of routine he just played.

MR. BUCHANAN: Where is the moral right of attacking and killing their soldiers? MR. MCLAUGHLIN: Right. Right.

MR. LOWRY: We were in a state of war with him that had never --

MR. MCLAUGHLIN: Pat, how much --

MR. LOWRY: We were flying planes --

MR. BUCHANAN: If he threatens us --

MR. LOWRY: We were flying planes in his sovereign territory.

MR. MCLAUGHLIN: Pat, what's the dollar amount of the war, the dollar amount of that war?

MR. ZUCKERMAN: Over a trillion dollars.

MR. BUCHANAN: Over a trillion dollars and rising.

MR. MCLAUGHLIN: A trillion dollars. And we are how many trillion dollars in debt?

MR. BUCHANAN: We're $15 trillion and rising.

MR. MCLAUGHLIN: Fifteen trillion (dollars) in debt. How much in debt are all of the members of the European Union?

MR. BUCHANAN: Sixteen (trillion dollars).

MR. MCLAUGHLIN: Sixteen (trillion dollars).

MR. BUCHANAN: Yeah, I think they're ahead of us.

MR. MCLAUGHLIN: About the same.

MR. BUCHANAN: About the same.

MR. MCLAUGHLIN: About the same; 27, and we still, I think, are ahead of them.

MS. CLIFT: Saddam Hussein was once an ally. I would remind you of that. And the real tragedy of this is the lives that have been so altered and damaged, and not to mention the medical care that it's going to take --

MR. LOWRY: When did he stop being an ally? What happened that made him stop being an ally?

MR. BUCHANAN: He invited Kuwait.

MS. CLIFT: I don't remember. MR. LOWRY: Yeah. That was --

MR. BUCHANAN: But we took care of that.

MR. MCLAUGHLIN: We took care of that.

MR. LOWRY: That was a major intervening event.

(Cross talk.)

MR. LOWRY: To say he used to be an ally, when he invaded one of his neighbors --

MR. MCLAUGHLIN: And H.W. says --

MR. LOWRY: -- (inaudible) -- to war against us.

MS. CLIFT: Yes. And the first Bush stopped. He didn't go all the way to Baghdad.

MR. MCLAUGHLIN: Issue Three: EU Plan Vetoed.

BRITISH PRIME MINISTER DAVID CAMERON: (From videotape.) Britain is out of it and will remain out of it. Other countries are in it and are having to make radical changes, including giving up sovereignty to try and make it work.

MR. MCLAUGHLIN: British Prime Minister David Cameron vetoed the European Union's plan to fix its fiscal mess; namely, its debt, inflicted upon it by its five biggest debtors -- Greece, Portugal, Ireland, Italy, Spain. The EU asked its members to pony up $268 billion in cash to offset those five countries' debt. Prime Minister David Cameron rejected the plan -- in fact, vetoed it -- because the plan fails to protect adequately U.K. financial services, that include, by the way, U.S. financial institutions located in London.

PRIME MINISTER CAMERON: (From videotape.) I said before coming to Brussels that if I couldn't get adequate safeguards for Britain in a new European treaty, then I wouldn't agree to it. What is on offer isn't in Britain's interests, so I didn't agree to it. MR. MCLAUGHLIN: What makes this plan so fatally flawed, in his view?

MR. ZUCKERMAN: Well, from his point of view, of course, the financial industry is a huge industry in England, and London is the financial capital of Europe and one of the financial capitals of the world. It's a huge part of their sort of economy, and they didn't want to lose the protections that they felt they had.

Also I suspect it didn't want to get too closely tied to the mess that's going to take place in the Eurozone. I mean, that whole part of the world is facing a catastrophe. And the question is, if he's part of this treaty, what is England going to be expected to do to pony up to help them out?

MR. MCLAUGHLIN: What do you think of the obligation of the healthy countries --

MR. BUCHANAN: John, I think you're missing the point.

MR. MCLAUGHLIN: -- like Germany and --

MR. BUCHANAN: You're missing the point here. One of the reasons that Cameron went out of this is trying to drive -- the Germans are trying to drive their Eurozone into a fiscal union where every Eurozone country reports on its budget to Brussels. Brussels reviews the budget and them tells them you've got to cut back or fines them or sanctions them.

What he has done, Cameron, has ignited a firestorm, John, among the populist right in Britain that is now raging across Europe, and it's going to bring this treaty or this agreement -- it's going to bring it down. And there you get to Mort's point. I think the only thing that can rescue the Euro now is the European Central Bank is just going to have to flood the place with Euros.

MR. MCLAUGHLIN: Let's get the arithmetic straight. There are 27 nations in the European Union. The Eurozone that Patrick is talking about, how many nations?

MR. BUCHANAN: Seventeen.

MR. ZUCKERMAN: Seventeen.

MR. MCLAUGHLIN: Seventeen.

MR. ZUCKERMAN: Seventeen.

MR. MCLAUGHLIN: Now, what are the delinquent nations that have to be provided for? You've got Italy. You've got --

MR. BUCHANAN: Spain. MR. ZUCKERMAN: Spain.

MR. MCLAUGHLIN: -- Greece. You've got Spain.

MR. BUCHANAN: Portugal and Ireland.

MR. MCLAUGHLIN: Portugal and Ireland.

MR. BUCHANAN: And Cyprus.

MR. MCLAUGHLIN: Those five are particularly delinquent.

MR. BUCHANAN: And Cyprus.

MR. MCLAUGHLIN: And it's their own fault, to some extent. Is that correct?

MR. BUCHANAN: Sure.

MR. ZUCKERMAN: Sure.

MR. BUCHANAN: Look, they --

MR. MCLAUGHLIN: The way they've handled their economy.

MR. BUCHANAN: They spent themselves --

MR. MCLAUGHLIN: Why should the others have to pay for them?

MS. CLIFT: Well, because --

MR. MCLAUGHLIN: In order to keep the union together.

MR. ZUCKERMAN: The one country that is going to have to pay for them is Germany. And the German public will not accept that. They're not going to pay for a profligate group of countries and say, hey, you overspent and now you want us to bail you out. The Germans are not going to do that.

MR. MCLAUGHLIN: The Germans have now a AAA rating from Standard & Poor's.

MR. ZUCKERMAN: That's correct. That's correct.

MR. MCLAUGHLIN: Why should she give that up?

MS. CLIFT: Because --

MR. MCLAUGHLIN: What obligation is she under?

MS. CLIFT: Because --

MR. MCLAUGHLIN: What is in the national interest of Germany?

MR. ZUCKERMAN: Because the Euro has made it possible for Germany to spread its exports --

MR. LOWRY: Yes. Yes.

MR. ZUCKERMAN: -- all throughout Europe.

MR. LOWRY: Don't cry too much --

MR. MCLAUGHLIN: Is the European Union --

MR. LOWRY: -- for Merkel. That's exactly right.

MR. MCLAUGHLIN: Is the European Union a plus for --

MR. LOWRY: Germany has benefited from an artificially low currency that has boosted its exports. So there is a benefit here to Germany that people shouldn't ignore.

MR. MCLAUGHLIN: Do you see any --

MR. LOWRY: But --

MR. MCLAUGHLIN: Do you see any analog for the United States here? We have 50 states. We have a central --

MR. LOWRY: No.

MR. MCLAUGHLIN: -- Washington. MR. LOWRY: No.

MS. CLIFT: No.

MR. LOWRY: We always had much more a single polity than Europe does.

MS. CLIFT: This makes --

MR. LOWRY: You can't have a democracy without a single people, which they don't have in Europe.

MR. MCLAUGHLIN: Forced prediction: Who's going to win the Iowa caucus?

MR. BUCHANAN: Newt loses.

MS. CLIFT: (Laughs.)

MR. MCLAUGHLIN: Win.

MS. CLIFT: That wasn't the question.

MR. MCLAUGHLIN: Quickly.

MS. CLIFT: Ron Paul. (Laughs.)

MR. LOWRY: I'm going to dodge like Pat. Newt loses.

MR. BUCHANAN: (Laughs.)

MR. ZUCKERMAN: Romney wins.

MR. MCLAUGHLIN: Romney wins.

The McLaughlin Group extends deepest sympathy to the family and friends of Christopher Hitchens. The world has lost a gifted thinker, author and iconoclast of both the political left and the political right. May he rest in peace.

END.