This is a partial transcript from "The Beltway Boys", October 1, 2005, that has been edited for clarity.

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(COMMERCIAL BREAK)

MORT KONDRACKE, CO-HOST: Let’s check out this week’s ups and downs.

DOWN: Louisiana’s congressional delegation, led by Democratic Senator Mary Landrieu (search) and Republican David Vitter (search). Despite Mother Nature’s delivering two major body blows to the nation’s economy, Louisiana is asking for a staggering $250 billion in reconstruction money. When The Washington Post looked at this, this figure, it opined, "Like looters who seize six television sets when their homes have room for only two, the Louisiana legislators are out to grab more federal cash than they could possibly spend usefully."

Now, Louisiana House members have backed off this number, but the senators are still persisting with it.

What I understand about the Republican plan is that when the $62 billion that’s already been appropriated runs out, and that, and it’s, and it’s being spent rather slowly, they would come in for $50 billion, and they would try to offset it, as the conservatives and some, and some moderates want, by slashing appropriations by maybe 2 percent across the board. And two, cutting entitlements even further that which will make the Republicans, the Democrats angry.

But the one good thing about all this is that there will not be a full repeal of the estate tax, which is a horribly regressive thing to do. And furthermore will inhibit charitable giving, which you want to encourage.

FRED BARNES, CO-HOST: Mort, if you say it’s so regressive, why do 70 to 80 percent of the American people favor it?

KONDRACKE: Because propaganda…

BARNES: No, no, it’s not propaganda. Because they think that all this money has been taxed before, which it has, and they don’t think death ought to be taxed. I don’t either. American people understand this. I, I’m sorry you don’t. But you’re like these Democrats who can always find some reason to justify not having a tax cut.

I want to show you something where the governor of Louisiana, Kathleen Blanco (search), came and testified in Washington before your friends, actually it was…

KONDRACKE: Some of your friends too.

BARNES: ... a Republican-chaired Senate Finance Committee. And just watch this. This is so telling.

(BEGIN VIDEO CLIP)

GOV. KATHLEEN BLANCO (D), LOUISIANA: Today, I came really to talk about job creation. I think there will be plenty of time to talk about other issues surrounding…

U.S. SENATOR MAX BAUCUS (D), MONTANA: Good, good for you, Ms. Governor Blanco. This is not about blame. This is about how we get the job done here. I appreciate your response.

BLANCO: We have a huge mission of rebuilding, but I do appreciate your sympathy.

U.S. SENATOR KENT CONRAD (R), SOUTH DAKOTA: Well, I appreciate your answer as well. I think that’s exactly the right course. But I thought you should be given, in fairness, a chance.

(END VIDEO CLIP)

BARNES: I tell you...

(LAUGHTER)

BARNES: Baucus and Conrad were about as transparent as you could imagine. Here the governor comes, we remember this is the governor who wouldn’t let the Salvation Army into New Orleans after the hurricane, wouldn’t let the Red Cross (search) in there. She’s the governor who sent out the National Guard, then nobody saw them anywhere. I mean, I mean, she’s the one who’s caused most of the problems down there, and Democrats rush forward and say, It’s so wonderful that you’re not going to talk about that.

When, she’s called before the House, before Tom Davis’s committee, she’s going to be grilled on that, as she should, because I think she bears a lot of the responsibility...

KONDRACKE: Wait, whoa. What you saw there was a witness protection program in action.

(LAUGHTER)

BARNES: Very good. Very good. Why didn’t I think of that?

DOWN: President Bush (search). With oil refineries in the Gulf-battered region, gas prices soaring, and oil companies taking historic profits, the Bush administration laid out its comprehensive plan to deal with the energy, the energy crisis, drive less. Here’s Bush Monday.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We can all pitch in by using, by being better conservers of energy. We people just need to recognize that these storms have caused disruption and that if they’re able to, you know, maybe not drive when they are on a trip that’s not essential, that would be helpful.

(END VIDEO CLIP)

BARNES: You know, that was disappointing. That was kind of silly, I think, on the part of President Bush, who I like and I think is doing a very good job, because he knows that the free market is working here.

What happens when you have less of a commodity? You have less oil, the price goes up, people buy less, they consume less, and you reach equilibrium. That’s why, that’s the way, you know, prices work. That’s why the free market works so well. That’s why we don’t have gas lines in the country right now.

Now, there are some people in America who would like to coerce the automakers into creating these so-called fuel-efficient cars, and, you, you know, setting these high standards. You don’t need to coerce them. What are people doing now with higher gasoline prices, Mort? They’re going out and buying smaller, more fuel-efficient cars (search). The free market’s working.

KONDRACKE: Yes. President Bush is suddenly in favor of conservation. What next? He’s going to discover global warming?

(LAUGHTER)

KONDRACKE: Look, look, I agree with you about the CAFE standards are not the best way to do it. The best way to encourage conservation is high prices, which means if oil prices ever go down again, slap a big gasoline tax on them...

BARNES: Oh, jeez.

KONDRACKE: and also spend the money for lots of energy research into, into alternative fuels.

Anyway, UP: Iraq (search). Despite horrific violence there is progress on the ground in Iraq. And perhaps more importantly, the October 15 election is on track. Let us hope that it comes off, let us hope that, as the administration says, the Sunni opponents of this cannot get two-thirds vote in, in three provinces. And let’s also hope that the Iraqi military gets trained up fast enough, faster than it is, because there’s only one battalion that’s capable of holding the insurgents off.

BARNES: You know, there really is progress, though, on the political side, as you’ve said, but also on the military side. I mean, look, the insurgents here or the terrorists have not been defeated, and they, and, and, and you really can’t defeat them. But these attacks, while a lot of people are killed, are really militarily insignificant. They’ve been driven out of the cities, they don’t, they can’t pull off as many attacks, there aren’t sophisticated weapons.

They’re just suicide bombers. They can kill a lot of people, but it’s not changing anything, really, on the ground.

KONDRACKE: Coming up, who drove exaggerations of rape and murder in post-Katrina New Orleans? We’ll tell you after the break.

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