Ups and Downs for the Week of Nov. 25-29

This is a partial transcript from The Beltway Boys, November 16, that has been edited for clarity. Click here to order the complete transcript.

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FRED BARNES, CO-HOST: All right. Let's go to the Ups and Downs .

DOWN: Saudi Arabia

BARNES: The U.S. escalates pressure on the Saudis to crack down on terror financing after allegations that charitable donations from the wife of Riyadh's ambassador to Washington may have found its way into the pockets of two September 11 hijackers. The latest flap is being downplayed by Washington, however. Here's Secretary of State Colin Powell.


COLIN POWELL, SECRETARY OF STATE: We have a good relationship with Saudi Arabia. There are issues that we raise with them from time to time with respect to the level of cooperation in some of the funding activities of nonprofit organizations and individuals within the kingdom. And we work through these in a spirit of friendship as befitting the longstanding relationship that we have had with Saudi Arabia.


JUAN WILLIAMS, GUEST CO-HOST: Fred, Secretary of State Powell was clearly, as you said, downplaying this. But you know what? The Bushes, Secretary of State Powell, and many other Washington bigwigs have a very close relationship with the ambassador from Saudi Arabia, Prince Bandar, and his wife, and they're all, you know, buddy-buddy.

You know what? I think if you even take into account the visit that the president gave, not only to Bandar but to Crown Prince Abdullah this year, going out to the ranch in Crawford, it seems to me that they are too  -- well, they're too willing to accept the abuses of this government, of the Saudi Arabian government. I don't understand it.

BARNES: Well, the best I can do is, is say that they realize that sometime after Saddam Hussein is dealt with in Iraq, a day of reckoning will come with the Saudis. The Saudis have never responded adequately to the fact that...a solid majority of the September 11 terrorists were, were from Saudi Arabia. They've never cracked down on, on the Wahhabi extremists...


BARNES: ... Islamists. They've...I mean, they haven't done squat. They've never had a full investigation of the Khobar Towers bombing, in which 19 American servicemen were killed back in 1996.

WILLIAMS: And they're antidemocratic.

BARNES: That, well, that's, you know...

WILLIAMS: You know, I...

BARNES: ...I mean, that's...putting it mildly. Their compromise now, but after Iraq, then the day comes.

WILLIAMS: Well, let's hope.

UP: Former Secretary of State Henry Kissinger

WILLIAMS: President Bush names Kissinger chairman of a bipartisan commission charged with investigating the September 11 terrorist attacks, an idea initially opposed by the White House. But with the commission now a reality, President Bush urges them not to dawdle. Watch.


GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I also hope that the commission will act quickly and issue its report prior to the 18th month deadline embodied in the legislation. After all, if there's changes that need to be made, we need to know them as soon as possible for the security of our country.


BARNES: Yes, Bush is talking about recommendations that this panel may make. Contrary to others, I think Kissinger is a, a strong chairman, is -- was a wise pick because he, he's so well know, he'll give some real credibility and attention to this commission.

But it's got to do more than just come up with recommendations about how we can avoid terrorist attacks in the future. I think it needs to look into the question that people care about, particularly the families...

WILLIAMS: Oh, yes.

BARNES: ... of, of the, of those who were killed, and that is, one, could September 11 have been a, averted? I suspect not, but I think they need to answer that question. And two, if it could not, if it could have been and averted, why wasn't it, and who's to blame? Those are the questions. They need to deal with then, anyway.

WILLIAMS: Well, you know what? They've got George Mitchell now as vice chairman of this, and so you've got a Democrat as the vice chair, a Republican as the chair. I'm worried that this is going to become a partisan exercise, because what you said, to my mind, is on target...


WILLIAMS: ... which is that they're going to assign blame. Well, if you're assigning blame, guess what? Some people are going to say, Not me.  And don't forget, Fred...

BARNES: They're all going to say that.

WILLIAMS: Right. But don't forget, the results right now, the president call for an 18-month panel, 18 months...


WILLIAMS: ... that's going to land it right square in the middle of the 2004 presidential race. So there's got to be, going to be a lot of finger-pointing back and forth. And I hope the families, the families who drove the White House to agree to this panel, aren't forgotten.

BARNES: Yes, I hope they aren't either. All right.

UP: Economy

BARNES: Holiday shoppers crowding the malls this weekend, and recent bullish economic news all point to signs that the economy could finally be coming out of its slump.

Check out these latest indicators, consumer confidence, it's up.  Consumer spending up 0.4 percent in September alone, the biggest increase in three months. Jobless claims dropped to a 21-month low. And third quarter gross domestic product rose at a revised 4 percent, up from the initial estimate of 3.1 percent last month.

Juan, I know you're incredibly impressed by these, but, you know, there is something that is missing, that still needs to be done, and that is, spurring business investment. That's been the biggest problem in this slowdown of -- in recent months, and, and we need to stir it.

So when President Bush comes in in January with his State of the Union address, and...has an economic proposal, that needs to be a part of it. One thing he could do would be to allow corporations who pay dividends to deduct the amount of those dividends. It would increase earnings, they'd have more money...

WILLIAMS: Oh, Fred, come on.

BARNES: ... to invest...

WILLIAMS: Fred, what are you talking about? That's profit. Dividends...

BARNES: I'm talking...

WILLIAMS: ... are profit. When American corporations do well and make money...


WILLIAMS: ... they should pay taxes.

BARNES: They do pay taxes.

WILLIAMS: You know, that's what they...

BARNES: But I, I, I'm trying to leave them a little more money to invest, which creates jobs and so on. You know, that's the...

WILLIAMS: Well, I'm hoping that they...

BARNES: ... way economy works.

WILLIAMS: ... that he might follow the Democratic example and use some of that 10-year tax cut to invest in short-term stimulus that you're talking about.

UP: American Civil Liberties Union

WILLIAMS: Once a liberal bastion, the ACLU is reaching out to two key conservatives to help push its privacy concerns in the next Congress, former House majority leader Dick Armey and former Georgia congressman Bob Barr.

BARNES: think this is a marriage made in heaven?

WILLIAMS: I think it's a marriage of the strange bedfellows here.


WILLIAMS: It's a situation, though, it's very interesting to me, because if you think about Dick Armey, very concerned about privacy, even to the point of not wanting red-light monitors, you know, those cameras that take your picture...

BARNES: ...if you go through the red light...

BARNES: ...that's right.

WILLIAMS: ... he doesn't want them here in the District of Columbia, but very concerned about privacy in general, and so is Bob Barr.

BARNES: You don't like those red-light monitors, do you?

WILLIAMS: I like them, I personally...I don't want anyone crashing

BARNES: OK. I kind of like them too. Anyway, you know what this marriage? It'll never work out.


BARNES: Well, these conservatives, they'll find out that they're not really welcome there.

WILLIAMS: Well, you know what?

BARNES: ...find out...

WILLIAMS: You're, you're, you're wrong if you think conservatives...don't care about privacy issues.

BARNES: Of course they do. All right.

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