The following is a transcription of the December 31, 2006 edition of "FOX News Watch" that has been edited for clarity.

ERIC BURNS, HOST: Will he [Sen. Barack Obama] be one of the big stories of 2007?

Will she [Sen. Hillary Clinton] be one of the big stories of 2007?

Will he [Sen. John McCain] be?

Will it [YouTube] be?

Will he [Kevin Federline] be?

Now, see you all laughed. I couldn't have laughed at that, because I didn't know who that was.

NEAL GABLER: You don't know Kevin?

BURNS: Kevin Federline — Britney's ex.

Let's assume — here's the easy question to answer: No, he won't be.

PINKERTON: Oh, well, you forgot the custody battle.

GABLER: The custody battle's coming up...

PINKERTON: ...between Britney and Kevin.

HALL: You'll notice that we all, except for Eric, know about this while we're condemning it. We all know the plot.

PINKERTON: Eric, we're talking about, all next year, we're going to be doing this.

THOMAS: Yes, we're going to redefine, legally, what unfit parenting means. Now that's going to be interesting to watch.

BURNS: Do you understand that it's still my turn to be talking?


BURNS: I haven't called on anybody yet.

HALL: Anarchy.

BURNS: Jane — big stories of 2007? Big trends?

HALL: I think we are going to probably see more stories of rescues. After the tragedy at Mount Hood, it seems to me...

BURNS: And the tragedy before that...

HALL: And the tragedy before that.

BURNS: Oregon.

HALL: I regret to inform us that we're probably going to see a lot more stories that involve dead women. If there's another Duke lacrosse-type story, we're going to see that all over — somebody disappears in the Caribbean. Talk about entertaining ourselves to death. We're going to see a lot of that.

PINKERTON: I'll pick four issues that are going to come, whether we want to or not. We may want to focus on Rosie O'Donnell vs. Donald Trump in the pay per view, but , I think we're going to get significant news and developments on public health. I think the issue of pandemics and so on. The Trust for America's Health, the D.C. group, has done a lot of work on this.

BURNS: Jim, that's a serious story. What makes you think we're going to get serious?

PINKERTON: Because it'll happen. That's the point. It's something - it'll - it'll be forced on us by events. I think that the immigration issue - I think what Cal said in the previous segment, there's a lot of merit to that, in terms of people who - who's in this country, what - I think the energy issue, energy independence, is going to be a - before all the candidates are going to be talking about it. I think that'll be the big issue.

And I think that the - the lack of missile defense that we have in terms of protecting this country and our allies, these will these are issues that will come to us tragically in a bulletin on our news alerts as opposed to something we would prefer to talk about, like Britney Spears' panties.

GABLER: Or lack thereof.

THOMAS: Or lack thereof.

I think in 2007 we're going to see a continuation of politics as a new religion.

The media used to give us a break between Christmas of an election year and a couple of months into the New Year. Now there is no break at all. And a religion has a Messiah figure, or Messiah figures. We're getting that with Obama and Hillary — all these people who will be — either claim for themselves or will be projected upon that they are able to deliver us from our respective problems.

Messiah figures have disciples. Messiah figures have their holy books. They've all written books. Obama's No. 1 out there.

So the media continue to treat politics as a religion, and as a force of deliverance for the terrible problems that confront us all.

GABLER: Well, let me be a little prosaic about this. I mean, the big stories of the year are going to be: number one: Iraq; and it's spiraling out of control. And that's going to be the dominant story as it goes complete to chaos over the coming year.

And I agree with Cal. I mean, politics, politics and politics. The beatification of Saint McCain. That's what we're going to see throughout the year.

THOMAS: Saint Obama, too.

GABLER: Because that - yes, but Obama is a different story. The Republicans want Obama to be nominated because they know he's easy pickin's.

BURNS: But these two stories, Neal, go together, don't they? Aren't we more likely to be looking to beatify a politician because we have a serious problem — so perceived in — in Iraq, and therefore we're wondering who the politician will be who will save us?


BURNS: The script, Eric, was written four years ago. Scripts don't change.

PINKERTON: Let's get in the middle of Neal's logic here for a second.

Obama will be beatified because the Republicans want to run against him. Neal, are you arguing that the Republicans control the media, and therefore the beatification process?

GABLER: I am - I am - what I'm arguing is that [New York Times columnist] David Brooks and his ilk desperately have been fomenting the idea that Barack Obama is the perfect candidate for the Democrats.

PINKERTON: But who is.

GABLER: Republicans have been.

PINKERTON: Who - who provides.


PINKERTON: ...98 percent of the puffy coverage on Obama? It's Newsweek..


BURNS: It wasn't David Brooks who put Obama on the cover of Time and Newsweek, or whichever one it was.

HALL: I think, again - you know, that we're covering it too early. But it's also true, we should shorten the elections. Part of it is has to do with fundraising, which is a story we ought to be seeing more on. I mean, there's a lot we talked about, we ought to be seeing more.

They're front-loading the primaries, and whoever can raise the most money wins...

GABLER: Right.

HALL: a huge problem in the — in the country. That's not really the media's problem, except the media are going to exhaust us all by January 2007. I'm sick of both of them already.

THOMAS: And there were press reports this week that the 2008 election will most likely be our first billion-dollar election.

Now who is going to have to sell their soul early enough to the people who can pay and buy all of the media time with the commercials and the crafting of the image to be able to raise that kind of money?

BURNS: Well, if that much money is going into the campaign, Jim, that means there's going to be commensurate coverage the whole year.

PINKERTON: Well, sure. But I guess the point is, somebody like Obama proves that it's not campaign finance, it's actually media attention or media adoration, as Cal would say, that is much more valuable. Remember, people raise money to get on TV. People who get on TV without raising money, as Obama obviously can — then you're well on your way towards getting the nomination.

HALL: But McCain did that. McCain had no money, and he got his name.

PINKERTON: McCain - McCain had no money, and he almost got nominated. He's still a major figure in American politics. He's a frontrunner.


BURNS: And that, I'm afraid — do it next year. We don't have time this year.

Because that's all the time we have for this week, and for this year.

Thanks to Jane Hall, Jim Pinkerton, Cal Thomas, Neal Gabler.

And I'm Eric Burns, thanking you for watching. Happy New Year, everyone! We'll see you a few days into the year.

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