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The McLaughlin Group Host: John McLaughlin Panel: James Pethokoukis, American Enterprise Institute; Eleanor Clift, Newsweek; Rich Lowry, National Review; Mort Zuckerman, U.S. News & World Report Taped: Friday, March 9, 2012 Broadcast: Weekend of March 10-11, 2012

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JOHN MCLAUGHLIN: Issue One: Drums of War.

PRESIDENT BARACK OBAMA: (From videotape.) They're not commander in chief. And when I see the casualness with which some of these folks talk about war, I'm reminded of the costs involved in war.

MR. MCLAUGHLIN: At a press conference this week, President Obama took sharp issue with the three Republicans who are blaming him for not doing enough with the U.S. military to stop Iran from acquiring a nuclear weapon. The president blasted Mitt Romney and Rick Santorum and Newt Gingrich for distorting his strategy and for warmongering.

PRESIDENT OBAMA: (From videotape.) One thing that we have not done is we haven't launched a war. If some of these folks think that it's time to launch a war, they should say so. And they should explain to the American people exactly why they would do that and what the consequences would be.

MR. MCLAUGHLIN: The president sees a window of opportunity and rejects beating the drums of war.

PRESIDENT OBAMA: What I've said is that we have a window through which we can resolve this issue peacefully. We have put forward an international framework that is applying unprecedented pressure. The Iranians just stated that they are willing to return to the negotiating table. And we've got the opportunity, even as we've maintained that pressure, to see how it plays out.

MR. MCLAUGHLIN: Question: What's the major issue of the presidential election now? Is it war, or is it the economy? James.

JAMES PETHOKOUKIS: I still think it's the economy. Listen, if we should have a war, then obviously that's going to knock the economy off the front page. It'll probably put us into a recession. But if all we're going to have is negotiations and this is going to be kind of an extend and pretend with Iran, it's still going to be the economy.

MR. MCLAUGHLIN: What about that, Eleanor?

ELEANOR CLIFT: Well, I think the president did a good job tamping down the war talk. One of the things he said at that press conference is that we don't have to make a decision next week or next month or two months. You had -- Prime Minister Netanyahu was in Washington, and there seemed to be this urgency to coming to a decision about how to handle Iran.

So the president made the case that he has put in place tough sanctions. The value of the Iranian currency -- it's lost half its value. They're really feeling the pain. They have now agreed to come into talks. Now is not the time for Israel to launch a pre-emptive attack. And so I think the president made his case, and Netanyahu basically went back to Israel, and in Israel, where the majority of public opinion is against pre-emptive strike. So I think, for the moment, the war drums have quieted.

MR. MCLAUGHLIN: Well, let's put that question to the president.

Sir, did you tell what she said to the Israeli prime minister, Benjamin Netanyahu, on his visit this week?

PRESIDENT OBAMA: (From videotape.) I'm not going to go into the details of my conversation with Prime Minister Netanyahu. But what I said publicly doesn't differ greatly from what I said privately. Israel is a sovereign nation that has to make its own decisions about how best to preserve its security. I am deeply mindful of the historical precedents that weigh on any prime minister of Israel when they think about the potential threats to Israel and the Jewish homeland. MR. MCLAUGHLIN: Question: So are Netanyahu and the Israelis sufficiently reassured? Rich.

RICH LOWRY: No. I mean, this is a pretty transparently cynical attempt on the part of the administration to say just enough to try to reassure Netanyahu without really committing ourselves to anything whatsoever. Now, I think President Obama bought some time with his tough talk, at least prior to the press conference, and the talks bought some time.

But Netanyahu is going to wait a couple of months, and then he'll have the opening, when these talks probably inevitably fail, to say, look, I gave it a chance and it's not working. And, in fact, the sanctions are biting Iran's currency and what not, but they are not in any way slowing the program. Even President Obama's own director of national intelligence has said as much.

So you've got a different viewpoint between us and the Israelis. They want to do this much quicker because they have a limited military capability, much more limited than us, and it's a much more serious threat to them than it is to us.

MR. MCLAUGHLIN: OK, AIPAC had a meeting this week. Mort will speak about that. And Mr. Romney, Governor Romney, wants to take Obama's job. He delivered these remarks to AIPAC this week.

FORMER MASSACHUSETTS GOVERNOR MITT ROMNEY (R, Republican presidential candidate): (From videotape.) I'll make sure Iran knows of the very real peril that awaits it if it becomes nuclear. I will engage Iran's neighbors. I will station multiple aircraft carriers and warships at Iran's door. I will not delay imposing further crippling sanctions. I will not hesitate to fully implement the ones we already have.

MR. MCLAUGHLIN: Question: Does Romney's hard line deter Iran from pursuing a nuclear weapon more than Obama's would? And what do you think of those remarks to AIPAC?

MORT ZUCKERMAN: Well, I mean, I think, without question, if he were the president, that would deter Iran. But he's not the president. All he is is a political campaigner.

Now, having said that, the fact is that neither the Israelis nor the Americans expect or intend to start a war within the next couple of months. One of the main sanctions that we hope to impose is on their central bank, and we haven't put that sanction into being. So our sanctions, as the director of military intelligence said, are having no effect and have had no effect on the speed with which they're doing it.

But there's a time line here that is critical to the Israelis, and that time line is when they get -- when the Iranians put their major technology, the centrifuges and the ability of those centrifuges to make the fissionable material they need for nuclear weapons, into this very, very deep underground facility that they are building, and at that point they are invulnerable to military attack, particularly any kind of air attack.

So you have a huge problem there, because once that time line is over with, the Israelis are faced with an existential threat.

MR. MCLAUGHLIN: Well, Israel has an estimated 100 to 200 nuclear warheads in Dimona. So that would mean annihilation for Iran, were Iran ever to do such a thing. Is that true or false?

MR. ZUCKERMAN: No, I don't believe Israel intends to use nuclear weapons against Iran. They will use conventional weapons against Iran to destroy, if they can, their facilities.

MR. MCLAUGHLIN: This is built on the supposition that Iran could use a nuclear strike against Israel.

MR. ZUCKERMAN: That's right.

MR. MCLAUGHLIN: That's the existential threat that is stated.

MR. ZUCKERMAN: This is not an existential threat for Iran. It's an existential threat --

MR. MCLAUGHLIN: Correct.

MR. ZUCKERMAN: -- for Israel. Now, the Israelis would have literally, if they started to launch the rockets -- and everybody acknowledges, including the director of military intelligence, that the Iranians have the technical capacity to put nuclear warheads on these missiles, at which point Israel would have a warning, if they launched a missile, of between 10 and 12 minutes. And the country would be wiped out.

MS. CLIFT: I think --

MR. MCLAUGHLIN: Do you realize what Obama has done by going with this press conference in which he gave really probably the best speech of his career at that press conference --

MR. ZUCKERMAN: Yes, it was very good.

MR. MCLAUGHLIN: -- the explanation of this? The way he moved through it -- MR. ZUCKERMAN: Yeah.

MR. MCLAUGHLIN: -- was simply brilliant, and perhaps truth- telling, I think quite truth-telling. Don't you?

MS. CLIFT: He also framed it as a matter of U.S. national security. It's not only about Israel's interests. And he pointed out that he has moved himself from thinking about a policy of containment to a policy of prevention. And his message for the last week is we've got Israel's back, but Israel, please do not act on your own, because you have to think through the consequences.

MR. MCLAUGHLIN: What's that phrase mean? What does --

(Cross talk.)

MR. PETHOKOUKIS: What in that speech made you think we had Israel's back?

MR. MCLAUGHLIN: Let her finish.

MS. CLIFT: You have to think through the consequences of war. And the Republicans have been getting away with a lot of loose talk.

MR. MCLAUGHLIN: Let James in.

MR. ZUCKERMAN: You think the Israelis --

(Cross talk.)

MS. CLIFT: And the only different --

MR. ZUCKERMAN: That's nonsense.

MS. CLIFT: -- the only different thing --

MR. ZUCKERMAN: That's nonsense to say the Israelis don't think through the consequences of war.

MS. CLIFT: The only different thing --

MR. ZUCKERMAN: That's ridiculous.

MS. CLIFT: -- that Mitt Romney would do is put more aircraft carriers there. So I think for the president to tell the Republicans --

MR. PETHOKOUKIS: That's not true. Romney said he's open to a pre-emptive military strike against those facilities. And as far as we have your back --

MS. CLIFT: And what does that mean? MR. PETHOKOUKIS: -- that is not a military doctrine. As we saw in that speech, he does not have Israel's back.

MR. ZUCKERMAN: No, he does not.

MR. PETHOKOUKIS: They're just another country who -- they could be Iceland, as far as he cares.

MR. MCLAUGHLIN: Who's bluffing? Is Netanyahu bluffing?

MR. ZUCKERMAN: I don't think anybody is bluffing.

MR. MCLAUGHLIN: Who's bluffing? Is Netanyahu bluffing?

MR. ZUCKERMAN: Netanyahu is not bluffing and he cannot bluff, not when he is facing a terrible decision for his country and a terrible risk.

MR. MCLAUGHLIN: You told me it was an existential threat.

MR. ZUCKERMAN: That's exactly right. That's why he's not bluffing.

MR. MCLAUGHLIN: And you said it would take one nuclear bomb. And I looked at the geography, and I think it would take more than one nuclear --

MR. ZUCKERMAN: One -- one nuclear bomb landing on Tel Aviv or Haifa and it's the end of that country. Nobody would stay there any longer.

MR. PETHOKOUKIS: You would kill half the population with one bomb.

MR. LOWRY: President Obama --

MR. MCLAUGHLIN: Let him in.

MR. LOWRY: President Obama is bluffing, because he says he has a policy of prevention, but I believe he is quite prepared to see that policy fail and to go to containment. And the key tell here is when the head of the Joint Chiefs of Staff said that Iran is a rational actor. And that's a term of art from deterrence theory, which says they will behave --

MR. MCLAUGHLIN: Yeah.

MR. LOWRY: -- in a rational manner, and we can contain these people.

MR. PETHOKOUKIS: (Inaudible.) MR. MCLAUGHLIN: What's this again? What'd you say?

MR. PETHOKOUKIS: They're assuming that -- they're assuming that the leaders of Iran are more like Brezhnev at the end of the Soviet Union than bin Laden. That is a tremendous gamble to take with world peace and with the Israeli nation.

MR. MCLAUGHLIN: Who's they?

MS. CLIFT: Excuse me. This is a war --

MR. PETHOKOUKIS: The administration.

MS. CLIFT: This is a war --

MR. PETHOKOUKIS: As Mort said, one Pakistani-style nuclear bomb on Tel Aviv, you could kill half the population and exterminate that country.

MS. CLIFT: This is --

MR. MCLAUGHLIN: Do you think that Obama was ill-advised to give --

MS. CLIFT: No.

MR. MCLAUGHLIN: -- that speech at the press conference?

MR. PETHOKOUKIS: I'm not sure ill-advised. I think --

MS. CLIFT: That was a brilliant speech.

MR. MCLAUGHLIN: Let him finish.

MR. PETHOKOUKIS: What this administration would like, they'd be delighted to see Iran test, successfully test, a nuclear weapon so they could be beyond this issue and, as Rich said, move to containment.

MR. MCLAUGHLIN: We also have --

MS. CLIFT: The president -- excuse me --

MR. MCLAUGHLIN: We also have the holy imam, the number one imam figure in this picture, in Iran. And he said this: We don't have any belief in the atomic bomb and don't pursue it. Our religious principles and beliefs forbid the acquisition and use of such weapons of mass murder." He was on, in fact -- he was repeating that message again this week.

MR. LOWRY: That's a lie.

MR. ZUCKERMAN: But let me tell you what -- MR. MCLAUGHLIN: And I'm sorry we don't have the video, because the video is in house here, and I don't know where it is.

MR. ZUCKERMAN: I don't know where it is either.

MR. LOWRY: (Laughs.)

MR. ZUCKERMAN: But if you're looking for a video, get the video that he made a few weeks earlier in which he said Israel is like a cancer on the body politic of the Arab world, and we're going to cut it out. So there's a slightly different -- he was giving a different speech at that point.

MR. MCLAUGHLIN: Well, what is that, metaphor?

MR. LOWRY: (Laughs.)

MR. ZUCKERMAN: I think that's what I -- what he's basically saying, we're going to destroy Israel, which they have said over and over again for decades.

MR. MCLAUGHLIN: I mean, he was flat-out saying this is against the Quran for --

MR. LOWRY: John, they also say --

MR. MCLAUGHLIN: -- us to develop an atomic bomb.

MR. ZUCKERMAN: Why are they doing it? Why are they spending all this time and money building atomic weaponry, then? Tell me why.

MR. LOWRY: They say it's for medical reasons.

MR. MCLAUGHLIN: Medical reasons.

MR. LOWRY: So they're risking the collapse --

(Cross talk.)

MR. LOWRY: They're risking the collapse --

MS. CLIFT: This is a war --

MR. MCLAUGHLIN: Let him in. Let him in.

MR. LOWRY: They're risking the collapse of their economy --

MR. ZUCKERMAN: This is not the war --

MS. CLIFT: Oh, yes it is, Mort.

MR. LOWRY: -- because of their great disinterested pursuit -- MR. ZUCKERMAN: Absolutely not.

MS. CLIFT: Yes, it is.

MR. LOWRY: -- of medical --

(Cross talk.)

MR. MCLAUGHLIN: Yeah, because of some isolated tributary through the heart, you know.

Exit question: Is it your felt intuition that this week's drama over a military strike on Iran may be a deliberate White House diversion from economic issues? After all, he went with this before the economic issues really came to light.

MR. PETHOKOUKIS: I think the administration believes that the economy is starting to cut their way, and I think they'd probably rather be talking about the economy than war.

MR. MCLAUGHLIN: But he also wants to talk about this.

MR. PETHOKOUKIS: Well, right. If he can paint the Republicans as warmongers --

MR. MCLAUGHLIN: No, he wants --

MR. PETHOKOUKIS: -- who are going to destroy the economy --

MR. MCLAUGHLIN: He wants to send --

MR. PETHOKOUKIS: -- which is exactly what he was saying.

MR. MCLAUGHLIN: No, he wants to send a message to Israel, and that's cool it for now.

MS. CLIFT: Right. And that --

MR. ZUCKERMAN: Absolutely. Absolutely.

MR. MCLAUGHLIN: Eleanor.

MS. CLIFT: And that message was received. Netanyahu went back to Israel again to a divided public. They don't want to go ahead without American support. And you can make the case --

MR. PETHOKOUKIS: So what do you do --

MS. CLIFT: Excuse me. It is my turn now. And rational people can make the case that there is nothing about the Iranian regime that suggests they are totally irrational players. They care about their own power and control, and you can't just assume that the minute they get a bomb, they're going to attack. MR. LOWRY: So what do you do --

(Cross talk.)

MR. MCLAUGHLIN: Quickly, quickly, quickly.

MR. LOWRY: What do you do if sanctions fail?

MS. CLIFT: Excuse me. That is the one --

MR. LOWRY: What do you do if sanctions fail? What do you do? Answer. Answer.

MS. CLIFT: Your --

MR. LOWRY: I'm letting you talk. What do you do if sanctions fail?

MS. CLIFT: I am answering. You are operating on the 1 percent Cheney doctrine. How well did that work out in Iraq?

MR. MCLAUGHLIN: (Laughs.)

MR. LOWRY: So you're OK with them getting a nuclear weapon.

MS. CLIFT: I didn't say that.

MR. LOWRY: And at the end of the day, that is also --

MS. CLIFT: I didn't say that.

MR. LOWRY: Yes, you did. And that's --

MS. CLIFT: I didn't say that.

MR. LOWRY; And at the end of the day, that's the administration's policy as well.

MR. MCLAUGHLIN: What's the -- (inaudible) -- on this 1 percent doctrine? What's -- 1 percent of what? One percent possibility?

MS. CLIFT: If there's a 1 percent possibility that Saddam Hussein has a nuclear weapon, you go in. Look how well that turned out for us. We are now going back into negotiations. There is time to be bought. MR. LOWRY: And you're OK with them getting a nuclear weapon. That is your bottom line.

MS. CLIFT: And the president -- that's not what I --

MR. LOWRY: If you're honest about it, that is your bottom line. You are OK with them getting a nuclear weapon.

MS. CLIFT: Will you please stop putting words in my mouth, Mr. Lowry? I would appreciate it.

MR. MCLAUGHLIN: (Laughs.)

MR. LOWRY: Well, what are you going to do? If sanctions don't work, what are you going to do?

MS. CLIFT: Stop howling like a war (dog ?).

MR. LOWRY: I'm not howling like anything.

MS. CLIFT: Yes, you are.

MR. MCLAUGHLIN: Issue Two: Primary Math.

MR. ROMNEY: (From videotape.) We've seen enough of this president over the last three years to know we don't need another five of this president. That's for sure.

I'm not going to let you down. I'm going to get this nomination.

MR. MCLAUGHLIN: Mitt Romney won six of Super Tuesday's 10 primaries, but he has not quite yet sealed the deal. That's because Rick Santorum, Newt Gingrich and Ron Paul are still in the race and still get a slice of the pie. But none of the three Romney challengers gives any indication of dropping out.

That leaves the primary ladder with 31 rungs left: Kansas, Virgin Islands, Alabama, Hawaii, Mississippi, Missouri, Puerto Rico, Illinois, Louisiana, D.C., Maryland, Wisconsin, Texas, Connecticut, Delaware, New York, Pennsylvania, Rhode Island, Indiana, North Carolina, West Virginia, Nebraska, Oregon, Arkansas, Kentucky, California, Montana, New Jersey, New Mexico, South Dakota and Utah.

Question: Why are the Republican primaries this year so protracted? Eleanor.

MS. CLIFT: Because they changed the rules from four years ago and they have more proportional primaries where delegates are awarded to all of the candidates, depending on the percentage of the vote. Four years ago, they were mostly winner take all, and John McCain was able to wrap it up. If they had the same rules today that they had four years ago, Romney -- it would be over. We would be writing that it's over. This campaign season has been like a long psychoanalysis of Mitt Romney. You know, why doesn't he relate to voters? Why can't he close the sale with the Republicans? But in the end, it's about arithmetic.

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

MS. CLIFT: And if you do the arithmetic, there is a chance that he may not have the 1,144 delegates he needs by June. But he will probably wrap it up June 5, when California votes, and New Jersey. New Jersey is winner take all, California by congressional district. Nobody else has the resources to compete in all the congressional districts. He may fall a little short. Then the Republicans have some super delegates who could vote for him. It's unlikely that it would go to Tampa unresolved.

MR. MCLAUGHLIN: Do you think journalist are manufacturing or at least exaggerating the inability of -- the alleged inability of Romney to connect with voters in some kind of a transformative way by the way he looks or things like that, that he lacks any real full identity? Do you get that from the press?

MR. PETHOKOUKIS: Listen --

MR. MCLAUGHLIN: You know, the press is about, what, 85 percent -- they voted for George McGovern for president of the United States. Do you remember that?

MS. CLIFT: That's been a while.

MR. LOWRY: You're surely not connecting --

MR. MCLAUGHLIN: Is that true now?

MR. ZUCKERMAN: Oh, yes. Oh, yes.

MR. MCLAUGHLIN: Is the press -- (inaudible) -- against Romney?

MS. CLIFT: They're not voting for George McGovern.

MR. MCLAUGHLIN: Is the press in love with Obama?

MR. ZUCKERMAN: Yes.

MR. MCLAUGHLIN: They are?

MS. CLIFT: No, they aren't.

MR. MCLAUGHLIN: Do you think it's still 85 percent?

MR. PETHOKOUKIS: That relationship is solid between -- (laughs) -- MS. CLIFT: Actually, Obama and Romney are very similar personalities. They're both kind of buttoned-up -- what is it, side A or side B, right brain or left brain? They're left-brain people. They both like to analyze things. But Obama can do --

MR. MCLAUGHLIN: I think Obama's left brain --

MS. CLIFT: -- the touchy-feely stuff. He can turn it on.

MR. MCLAUGHLIN: -- and he's right brain.

MR. LOWRY: Well, that's the irony is Romney is really duplicating the Obama side of the Obama-Hillary race, where he's picking up the upper-scale voters, the better-educated voters, the more urbanized voters. And this is a weakness they have going throughout.

MR. MCLAUGHLIN: I'm going to interrupt you and give this back to you. At this point, is there any possible white knight scenario? Any other Republican who could possibly muscle into this GOP lineup?

Sarah Palin? Jeb Bush, former governor of Florida, W's brother? Chris Christie, governor of New Jersey? Mitch Daniels, governor of Indiana? Could one of these Republican darlings swoop in and take the Republican nomination away from Romney? Has Romney done anything to warm up the hard-core conservative GOP base? Or are they too purist?

Let's get the exit question. Any possibility of a white knight? Yes or no.

MR. PETHOKOUKIS: I do not believe so. I believe there's no chance.

MR. MCLAUGHLIN: That's a no. That's a no.

MR. PETHOKOUKIS: No.

MR. MCLAUGHLIN: No?

MS. CLIFT: I'm going to give it a no too.

MR. MCLAUGHLIN: No?

MR. LOWRY: Even if he falls a little short of the magic number, he's still going to have the moral authority of having won more delegates than anyone else.

MR. MCLAUGHLIN: Oh, yeah. That's a metaphysical what? I don't want to say? (Laughter.)

MR. LOWRY: No. That's a drawn-out no. MR. MCLAUGHLIN: The answer is --

MR. ZUCKERMAN: No.

MR. MCLAUGHLIN: -- five no. No way to get in.

Issue Three: First, Rosy Scenario.

PRESIDENT OBAMA: (From videotape.) We've clearly seen some positive economic news over the last few months. Confidence is up and the economy is getting stronger.

MR. MCLAUGHLIN: President Obama is bullish on the U.S. economy. Here are the reasons why.

Item: Manufacturing up. February was the 31st consecutive month of U.S. manufacturing growth.

Item: U.S. auto industry up. January and February sales of cars and trucks were the highest since May 2008.

Item: Economic confidence up five points, January to February; six straight months of rising economic confidence.

Item: Stock market up, closing above 13,000 for the first time since May 2008.

Item: Jobs up. The payroll service ADP reports that the U.S. economy has produced in February 216,000 new jobs.

Question: The U.S. unemployment rate for the month of February 2012 is 8.3 percent. That's unchanged from January, the figure of 8.3 percent. The U.S. economy in February produced 227,000 jobs. The foregoing, what I just said, is the scenario of -- the rosy scenario of the economy.

Well, these roses have a lot of thorns. Give me the thorn scenario, Mort. Or do you want me to help you with it? For example --

MR. LOWRY: (Laughs.)

MR. MCLAUGHLIN: -- Gallup approval rating stuck at an average of 45 percent, while his job disapproval rating averaged 47 percent. For every positive indicator cited in the TMG setup, there is a corresponding negative indicator or perception that more than offsets the good news.

MR. ZUCKERMAN: Well, I'll give you one. I mean, housing prices are still going down. We have lost $10 trillion -- these are government numbers -- in household wealth, $2.4 trillion in the last quarter of last year. So that's not too long ago. What is more, if you measure consumer sales and you take out what we call non-discretionary consumer sales, namely food and fuel, in fact, consumer sales are basically one tenth of 1 percent in January, which is meaningless.

So the economy remains very weak, three years into the largest stimulus of both monetary and fiscal policy in our history, where normally the GDP would be growing at 8 percent with this kind of stimulus and it's growing at less than 2 percent.

So I don't know how it's going to go because it's unprecedented, and therefore unpredictable. But it is not nearly as optimistic as you were implying, and certainly as the president was implying.

MR. MCLAUGHLIN: The Gallup report regarding perceptions of the economy -- 40 percent say the economy is improving in the latest Gallup poll; 56 percent say it's getting worse. This poll is from February 26th, before --

MR. ZUCKERMAN: Yeah.

MR. MCLAUGHLIN: -- and that's before the gas prices started going up, and it's now about $3.75 a gallon.

MR. ZUCKERMAN: Right.

MR. MCLAUGHLIN: Am I right?

MR. ZUCKERMAN: That's one of the big risks in this economy.

MS. CLIFT: They're not high-fiving. They're not high-fiving in the White House. They realize that this is a very fragile recovery. And if Mitt Romney wants to gain some traction on the economy, which I don't think he has, he ought to use these victory Tuesday nights to deliver a compelling vision on the economy. His plan so far is less regulation, lower taxes. We basically tried that under Bush. That hasn't worked. That's not enough. And so I think he really misses an opportunity here.

And the president has to do a better job selling the fact that his -- the policies he's put in place are beginning to pay off. And Mark Zandi, who's a very respected spokesman --

MR. LOWRY: (Laughs.)

MS. CLIFT: Why does that elicit a laugh?

MR. MCLAUGHLIN: (Laughs.)

MR. LOWRY: I think you're going to say McCain adviser next.

MS. CLIFT: Mark Zandi is a very respected -- (Cross talk.)

MR. MCLAUGHLIN: He's just baiting you when you laugh -- when he laughs at you, and you go right for his jugular.

MS. CLIFT: Exactly.

MR. LOWRY: (Laughs.

)

MR. MCLAUGHLIN: He distracts you. Why does he --

MR. LOWRY: Hands off my jugular, Eleanor.

MS. CLIFT: Well, I'm sorry I did, but I'd like to resume my pattern of thought --

MR. MCLAUGHLIN: All right, go ahead.

MS. CLIFT: -- which is Mark Zandi says that the stimulus basically did its job. It pulled us back from the brink of depression. But it was not expected and could not basically thrust us into a robust recovery. So we're still waiting for that. And as I said, they're not high-fiving in the White House. Mitt Romney is acting like the president thinks that his job is done. It's not.

MR. MCLAUGHLIN: Why -- if things are looking up, quasi-rosy, as Obama says -- and he listed some things, including manufacturing -- the latest Gallup data on Obama's presidency tells it all. Forty-four percent say his presidency has been successful so far. Fifty percent say his presidency has been a failure. Do you believe that?

MR. LOWRY: Look, it's probably going to be a muddle, which it is now. It's not going to be a Carter-like disaster, running in the face of -- in the teeth of a recession. It's not going to be a Reagan-like boom, where you're putting big crooked numbers on the board in terms of GDP growth. He's going to be this middling range --

MR. MCLAUGHLIN: Yeah.

MR. LOWRY: -- where he's beatable but hasn't lost.

MR. MCLAUGHLIN: Do you think Romney should have his spine stiffened by this?

MR. LOWRY: Yeah, I mean, Eleanor is right about Romney. These election night speeches, there's been nothing memorable about them. He should run, just frankly, as the mechanic of the economy.

MR. MCLAUGHLIN: Right. MR. LOWRY: And he shouldn't bother with trying to connect with people --

MR. MCLAUGHLIN: Get a mechanic in --

MR. LOWRY: -- at an extremely human level.

MR. MCLAUGHLIN: Fix the engine, Eleanor. Fix the engine. That's what's important.

MS. CLIFT: That's what Ross Perot talked about. Remember lifting the hood of the car?

MR. MCLAUGHLIN: Predictions. James. Take your time.

MR. PETHOKOUKIS: (Laughs.) The current unemployment rate is 8.3 percent. That will be the low for unemployment for the year. It's only going to drift higher from here.

MR. MCLAUGHLIN: You know what Gallup gives the unemployment rate as?

MR. PETHOKOUKIS: It's, like, over 9 percent.

MR. MCLAUGHLIN: Yeah. Why is that?

MR. PETHOKOUKIS: They measure it differently. They don't take into account various seasonal adjustments. And, of course, 8.3 percent, that is a very rosy way of looking at it. If you assume the (labor force ?) --

MR. MCLAUGHLIN: Do you think --

MR. PETHOKOUKIS: -- (inaudible) -- it's actually over 10 percent.

MR. MCLAUGHLIN: Do you agree with Mort that the Bureau of Labor Statistics, that gives us that information, is slanted, and this seasonal adjustment has a lot of cushy stuff inside there that we don't want to even talk about?

MR. ZUCKERMAN: Look, let me just say one thing here.

MR. MCLAUGHLIN: Mort, go ahead.

MR. ZUCKERMAN: The 8.3 percent measures people who have actively applied for a job in the last four weeks. When you've had the average period of unemployment, which is over six months, almost seven months, that is a ridiculous standard on the basis of which you should look at unemployment. If you look at unemployment in terms of the number of people who have applied for a job in the last six months, it's 15 percent. These are government numbers. And to that you have to add the people who have left the labor force, which, if that adjustment was put in, it would be 18 percent. So the numbers are much worse than they look.

MR. MCLAUGHLIN: Do you want to give your prediction? Is that buried in there? (Laughter.)

MR. ZUCKERMAN: No. I'm saving the rest of my prediction. My prediction is --

MR. MCLAUGHLIN: Should we come around to you?

MS. CLIFT: No, I --

MR. ZUCKERMAN: Don't do it on an alphabetical basis.

MR. MCLAUGHLIN: You are gaming me, aren't you?

Eleanor. You're next, Eleanor.

MS. CLIFT: Exactly. However underflated the 8.3 percent is, people will really be watching that number and the media will be watching that number, come summer. And I think it's going to be down by 8, which is going to be very good for the president.

MR. MCLAUGHLIN: Fifteen seconds.

MR. LOWRY: In the Massachusetts Senate race, Elizabeth Warren will go from being the darling of the liberals to the candidate the liberals want to forget. She's already down by a significant amount in the latest polls. And Scott Brown, against expectations, is doing quite well opposing the HHS contraception mandate.

MR. MCLAUGHLIN: That's Elizabeth won't make it, right?

MR. ZUCKERMAN: Right.

MR. MCLAUGHLIN: Won't become a senator from Massachusetts.

Go ahead.

MR. ZUCKERMAN: The economy is going to be affected in addition by the weakening of the Chinese economy, which is really on the verge of a serious downturn, which is going to affect the entire global economy, including the United States.

MR. MCLAUGHLIN: Interesting.

I predict that President Obama will do an about-face and he will help on the Syrian rebels who are confronting the Assad regime's forces. Bye-bye. END.