(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  These are barbaric people.  There‘s no justification whatsoever for his murder.  And yet, they killed him in cold blood.

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES:  America will hunt down these killers, find them one by one, and destroy them.

(END VIDEO CLIP)

SCARBOROUGH:  And swift justice in Saudi Arabia.  The man who claimed responsibility for Johnson‘s murder, al Qaeda‘s top figure there, killed by Saudi forces.

The Saudi government says it did everything it could to find Johnson and called his killers barbarians.

(BEGIN VIDEO CLIP)

ADEL AL-JUBEIR, FOREIGN POLICY ADVISOR TO THE SAUDI CROWN PRINCE:  His brutal murder illustrates the cruelty and inhumanity of the enemy we all are fighting.

(END VIDEO CLIP)

SCARBOROUGH:  Tonight, we have a special two-hour SCARBOROUGH COUNTRY, “The Murder of Paul Johnson.”  How did it happen?  What‘s next?  And what affect will his murder have on America, the kingdom of Saudi Arabia and the world?

ANNOUNCER:  This is a SCARBOROUGH COUNTRY special report.  Here‘s Joe Scarborough.

SCARBOROUGH:  Welcome to our show tonight.  We have NBC News‘ Jim Miklaszewski with us, live from the Pentagon.

Mike, obviously, it was a tragic day.  Give us the latest developments.

JIM MIKLASZEWSKI, NBC NEWS CORRESPONDENT:  Well, according to U.S.  officials, they have confirmed, of course, what Saudi officials have said, is that following the murder, the decapitation of Paul Johnson sometime today in Saudi Arabia, Saudi authorities actually came upon the perpetrators, the head of al Qaeda operations there in Saudi Arabia, Abdul Aziz al-Mughrin and three of his cohorts, apparently disposing of the body on Friday night in Saudi Arabia. 

A shootout ensued and al-Mughrin and the three al Qaeda cohorts were all killed. 

Now Saudis, of course, are hailing this as a huge victory over al Qaeda in Saudi Arabia.  However, some U.S. officials are raising their eyebrows at the timing.  They are wondering if, in fact, the Saudis perhaps didn‘t have some kind of lead on al-Mughrin earlier and perhaps could have prevented the decapitation and killing of Paul Johnson. 

That aside, even U.S. officials say this is a huge blow against al Qaeda, at least there in Saudi Arabia. 

Al-Mughrin, of course, is no stranger to counterterrorism officials.  He actually joined in the fight against Saudi Arabia when he was—I mean, against the Soviet Union in Afghanistan when he was only 17, went on to fight in Bosnia and was eventually actually jailed in Saudi Arabia and released in August 2001, just one month before 9/11 for what was, quote, “good behavior,” unquote. 

However, some U.S. officials, despite the fact that it appears that at least this portion of the terrorist saga there in Saudi Arabia is wrapped up, that there are still many others like al-Mughrin still prepared to launch attacks against Westerners in Saudi Arabia. 

SCARBOROUGH:  Mike, take us behind the scenes over the past few days at the State Department and the Pentagon.  What exactly did the administration do regarding contacts with the Saudi government to try to move to save Mr. Johnson before this deadline approached?

MIKLASZEWSKI:  Well, there was a very concerted effort by not only State Department, Justice Department officials, law enforcement officials, not much in terms of U.S. military operations, although there were offers to share intelligence where that was possible. 

But—but nobody had a good lead on exactly where Paul Johnson or his captors may have been.  And as we know now, all those efforts were for naught. 

Now I can tell you that there is—the State Department is preparing to send an emergency security team over to the embassy and by sometime next week, a team of U.S. Marines, so-called fast team are expected, about 30 to 40 Marines are expected to head over to the embassy there to increase security for U.S. embassy employees. 

But there are somewhere between 30,000 to 40,000 Americans still in Saudi Arabia, still considered to be targets of any terrorists who remain in that country. 

SCARBOROUGH:  All right, thanks so much, Jim Miklaszewski at the Pentagon.  We greatly appreciate it. 

MIKLASZEWSKI:  You bet you.

SCARBOROUGH:  We now bring in MSNBC‘s terror expert, Steve Emerson. 

He‘s with us.  So is former FBI profiler Clint Van Zandt.

Let me start with you, Steve Emerson.  Obviously, a tragic day for the Johnson family, for the people of New Jersey, in fact for the people of America.  But how significant is it that the leader of al Qaeda in Saudi Arabia was confirmed killed in a shootout with authorities over there?

STEVE EMERSON, MSNBC TERRORISM EXPERT:  Joe, the problem is that he should have been taken out or at least kept in jail, because he had been arrested four years ago and basically had his sentence commuted and let out for, quote, “good behavior” two years ago. 

And he‘s had been operating on Saudi soil essentially for two years with virtual impunity.  It should not have taken a decapitation of an American in such a gruesome manner to have finally captured and killed this man.  He should have been arrested and taken off the streets years ago. 

The problem is, Joe, that this has been a disaster that the Saudi Arabian government has largely been responsible for in terms of espousing and creating incitement that recruits, people like Mr. Al-Mughrin, who ended up saying it‘s all right to kill Americans and decapitate them in any way I want to. 

SCARBOROUGH:  Well, Steve Emerson, OK, but now he‘s—now he‘s dead.

EMERSON:  Right.

SCARBOROUGH:  He‘s off the streets.  Is that a victory of the war on terror?  Or do you believe, like some U.S. officials that are raising eyebrows, that the Saudi officials have too close of a relationship with these terrorists and they could have nailed him before Paul Johnson was murdered?

EMERSON:  Well, Joe, it‘s never either or.  I think it‘s definitely—you know, one less terrorist off the streets is definitely one less bad guy around.  On the other hand there are others willing to move up the ranks. 

Here is a guy, by the way, that basically got his—he had his 12 hours of fame today.  He became a general in the al Qaeda network and now he‘s gone, and somebody else has taken his place. 

The question is how many others are out there and how many Saudi officials are really turning a blind eye?  And where are they turning a blind eye to the creation of Islamic militancy?  How are they fostering this?  What types of moneys are they pumping into these groups? 

And are Saudi security forces turning a blind eye to those in al Qaeda that have operated for years now with almost total autonomy?  And that‘s a key question that we keep asking. 

Every single time an event like this happens, we say, “Oh, the Saudis are going to do something.  They‘re going to round up more people, the usual suspects.”  But in the end, they‘re going to weather the storm.  They had the news conference today in Washington.  It was for the American consumption, not the Saudi consumption.

And the real question is, are we going to finally demand that they change their ways?  And I‘m afraid not.  Maybe we will.  I think there are people at the Justice Department and the FBI that really want to stop this monster from becoming the Frankenstein that it has almost become fully worldwide. 

SCARBOROUGH:  Clint Van Zandt, let me bring you in today.  Obviously, a big development today.  The FBI was reportedly conducting house-to-house raids in Riyadh to save Paul Johnson. 

Tell us about the FBI‘s role in the activities, the security activities today in Saudi Arabia.  And wasn‘t that unprecedented?

CLINT VAN ZANDT, FORMER FBI PROFILER:  Well, this was something you‘re not going to hear much about, especially from the Saudis.  The Saudis want to give the impression that they can do this all themselves.  But they don‘t have the technical skills, the negotiation skills, the profilers, and the FBI‘s hostage rescue team is second to none as far as going into a hostage rescue mission. 

So first of all, the FBI has a legal attache, one of the 45 countries in the world where there‘s an FBI presence.  Now, this has come about, Joe, as you know, kicking and screaming from the Saudis part after the bombing of the Khobar Tower.  FBI Director Louis Freeh went over there trying to wring information out of Saudis, and they wouldn‘t give it up. 

So this has been really slow, and the chickens are starting to come to roost for the Saudis. 

Now this house-to-house search that has been conducted the last few days.  This is like 15,000 Saudi police officers, probably FBI agents assisting, although the Saudis will never tell you that, and even firemen. 

You know, Joe, we take firemen with us because they find ways to get into the buildings that sometimes law enforcement don‘t find. 

So this was a door-to-door, house-to-house search.  But again, you know, I question how quickly they were able to, unfortunately, kill this American and then how quickly shortly thereafter, the Saudis find them and of course, kill them all so we can‘t talk, we can‘t interview anybody. 

And you know, this is not just dust your hands off and say, “OK, you know, four of them and one American, now we‘re even.”  This is going to continue.  As Steve says, there is going to be other corporals who are going to be want to be generals in al Qaeda who are going to step up to bat again. 

And if the Saudis don‘t draw a line in the sand and say, “No more.  Oil or no oil, we‘re not going to allow terrorism to continue,” we‘re going to see this happen over and over again. 

SCARBOROUGH:  And you know, Clint, unfortunately there has been a long history of the Saudis, like you said, not cooperating.  Back when I was in Congress, the Armed Services Committee, 1998, the killings at Khobar Towers.  There were some men from my district who were killed there.  We tried to investigate. 

The Saudis obstructed us.  I mean, you could only call it obstruction of justice.  They would not let us get near the people that committed these acts of terror. 

I want to play for both of you gentlemen a visibly angry President Bush in Seattle earlier today, responding to Paul Johnson‘s murder. 

(BEGIN VIDEO CLIP)

BUSH:  The murder of Paul shows the evil nature of the enemy we face.  These are barbaric people.  There is no justification whatsoever for his murder.  And yet they killed him in cold blood. 

(END VIDEO CLIP)

SCARBOROUGH:  Steve Emerson, the president of the United States is correct.  They killed him in cold blood.  But I can tell you, I‘ve been speaking to some Americans since the killing today and they‘re all asking the same question.  What can we do to strike back?  And are all Americans over are all Americans over in Saudi Arabia basically at the mercy of al Qaeda terrorists?

EMERSON:  Absolutely, Joe, they are at the mercy of al Qaeda terrorists, and the State Department has asked they leave but they‘ve lived there for years or they have high-paying contracts and they don‘t want to run.  Now I understand that. 

On the other hand, there is not much you can do if you‘re dependent upon a regime that essentially incites and protects some of the very people that are attacking you. 

The question is what can we do here?  Look, it‘s moral outrage.  It‘s the same moral outrage that erupted after 9/11 when 15 of the 19 hijackers emerged from Saudi Arabia to carry out devastating killings in the United States.

SCARBOROUGH:  Steve, I‘m sorry, I‘ve got to interrupt you.  I want to ask you, because you just made a statement that many Arab-Americans might consider inflammatory.  You said the Saudi government actually incites these people and—and promotes this type of behavior.  How do they do that?

EMERSON:  Well, the Saudi government, per se, doesn‘t operate as a unified government.  What you have in the Saudi government are competing fiefdoms, the religious affairs ministry, the interior ministry.  You have the Saudi religious establishments, the WATS (ph).

And those are groups and establishments that promote incitement that are on Saudi television, in the media, on the Internet saying that either Jews or Christians or infidels are the enemies of Islam.  And they are absolutely the ones responsible for creating this culture and this climate of ideological violence that ends up being used by militants such as al-Mughrin to say it‘s OK to kill Americans. 

That‘s the real issue here.  Lisa Myers did a phenomenal report last week showing that a key top Saudi official, and one of the leaders of Saudi Arabia, blamed international Zionists for the attacks several weeks ago in Saudi Arabia. 

Clearly, they are trying to focus anger against the, quote, “enemies of Islam” without dealing with the extremist elements within themselves. 

Joe, I might add that tonight I just saw an A.P. story in which the reactions from Saudis on the street in that same district was the Americans all deserve it.

Reality is that there is, unfortunately, a high degree of support for bin Laden and Islamic militancy that we don‘t want to recognize or admit to, because that would say that the mainstream is radical. 

SCARBOROUGH:  Steve, you‘re exactly right.  Earlier this week, we—we showed a poll that over 50 percent of Saudi residents actually supported bin Laden and what he‘s been doing over the past several years. 

I want to read—I want to read, though, quickly.  I have a couple of things I want to read you guys.  One came from the BBC web site tonight.  It posted—it was actually a statement by a prominent Saudi cleric.  It surprised me.  That‘s why I want you to read it—hear about it.

And he said this at Islam‘s holiest shrine.  He said the hostage takers and the murderers committed grave sins under Islam and said “whoever kills any person under our protection will not go to heaven,” speaking of those that committed these murders earlier today. 

And I also want to read you a quick timeline of terror attacks in Saudi Arabia.  Of course, May of last year, suicide bombers attack three housing compounds, killing 35 people. 

Looking at recent history, May 1 this year, gunmen attacked an American-based company, killing six Westerners and a Saudi.  May 22, gunmen shot a German in Riyadh.  Late May, terrorists had attacks on an oil compound in Khobar, killing 22. 

And this June 2, BBC reporters were shot, one was killed, and in an al Qaeda stronghold outside of Riyadh, the other wounded.  And it escalated this afternoon, of course, with another vicious murder, this time American citizen Paul Johnson.

Clint, let me get final comments from you. 

VAN ZANDT:  Yes.  Well, you just mentioned the most recent, Khobar Tower, where 22 people were killed.  You know, the Saudis supposedly surrounded that compound, and yet mysteriously three of the four killers somehow slipped away.  I don‘t—you know, I don‘t buy that.  I don‘t buy it at all. 

There is something that continues to go on there where the Saudis support that type of activity.  And if they want to sell oil to us, sell oil but be our friend and don‘t let this go on.  If not, we‘ve got to find somebody else to—to go the pump for, Joe. 

SCARBOROUGH:  I agree with you.  Unfortunately, administrations, both Republican and Democrat have allowed the Saudi government to play both sides for too long.  It‘s got to stop. 

Now, still ahead, the world is reacting to the murder of American hostage Paul Johnson.  We‘re going to also find out how this barbaric act could impact U.S.-Saudi relations.  That‘s next.

(COMMERCIAL BREAK)

SCARBOROUGH:  How is the Arab world reacting to Johnson‘s murder? 

Earlier, Saudi government official Adel al-Jubeir made this statement. 

(BEGIN VIDEO CLIP)

AL-JUBEIR:  Today we are faced with the tragedy of this gruesome death at the hands of barbarians who have rejected the teachings of their faith and the principles of humanity.  His brutal murder illustrates the cruelty and inhumanity of the enemy we all are fighting.

On behalf of my country and every individual with a sense of decency and humanity, I offer our most heart-felt condolences to his family and friends. 

(END VIDEO CLIP)

SCARBOROUGH:  I‘m joined now on the phone by Charlene Gubash.  She‘s NBC News producer in Cairo, Egypt.  And also, we have Raid Quspi.  He‘s Riyadh bureau chief for “Arab News.”

Let me begin with you, Charlene.  What‘s the reaction in Egypt?  How are they reacting to this news?

CHARLENE GUBASH, NBC NEWS CAIRO BUREAU CHIEF:  Hello, Joe.

The few people we were able to reach tonight, because it‘s very late here, were shocked and really horrified by this news.  They thought that it was terrible that he was taken hostage in the first place, that his eyes were bandaged like that.  They couldn‘t believe that he was killed.  And—and they were pretty much horrified by that.

And—and a far as newspaper coverage, the newspapers here go to print very early, so they didn‘t manage to get it in print.  But “al-Hayat,” which is like our “New York Times,” had a big headline which read, “Riyadh delivers a big blow to the terrorists with the killing of al-Mughrim and three other wanted men after slaughtering the hostage.”

SCARBOROUGH:  How is that—how do you expect that to play in the Middle East?  The fact that the leader of al Qaeda in Saudi Arabia was killed in the events earlier today?

GUBASH:  Well, especially in Egypt, people are going to be very happy about that.  They hate terrorism in Egypt after having suffered from it directly for more than 10 years, and especially because a lot of their business is—Egypt run on tourism; it‘s their biggest money earner here.  And many of their businesses were hurt by it, so they know how devastating terrorism can be to them and also how horrific it is after something like the Luxor massacre. 

So in general, people here are pretty happy to see someone like this be killed. 

SCARBOROUGH:  Raid Quspi, let me bring you in.  Obviously, there have been reports over the past several weeks of polls showing that as many as 50 percent of Saudi citizens supporting some of the things that Osama bin Laden has stood for in the past. 

How do you believe the Arab street, as it‘s called, is going to be responding in Saudi Arabia to reports of the killing of Paul Johnson and then, of course, the killing of al Qaeda‘s leader in Saudi Arabia?

RAID QUSPI, RIYADH BUREAU CHIEF, “ARAB NEWS”:  Well, let‘s not forget sir, that Saudis are victims of terror, as well.  I mean, since May 12 and until this evening, over 60 to 70 of our own nationals have been killed by these outlaws, the renegades who are going about slaying not just Westerners but Saudis and innocent children—children and women and elderly, as well. 

They—I mean, it has been known and from people I have spoken to, from locals and residents and even civilians there was a sense of shock and despair, of course, to—to the gruesome killing of Mr. Johnson. 

And—but at the same time, there was a sense of a lot of Saudis were relieved to hear that al Qaeda leader in the kingdom was—was killed, and two other on the most wanted terror list were also killed in the capital today. 

SCARBOROUGH:  Since September 11 -- Since September 11, many Americans have blamed the Saudi government for trying to have it both ways by verbally attacking terrorists but not taking a hard enough line against them. 

Do you believe the attacks that began in Saudi in may of last year, leading up to the attack today, may be causing the Saudi government to crack down on al Qaeda more than it did before the attacks came to Riyadh last year?

QUSPI:  Well, yes, that‘s a good question.  I think that our Mr. Al-Jubeir announced in Washington that the Saudi has taken drastic actions to, A, for example to monitor our charities.  Ours are no longer unmonitored, and now a specific government body which has sponsored on international ground will be monitoring our charities to make sure and to—to guarantee that they don‘t go to the wrong hands. 

We have sacked several imams in the past, and we continue to monitor our mosques now and to make sure that hatred and speech of intolerance is not being used in our sermons. 

Several measures have been taken.  One of the new measures that we‘re taking is we‘re cooperating on the intelligence level with the United States and several other countries. 

We‘re beefing up security.  I have been told that some 15,000 security officers were taking place in the combing of several districts in the capital over the past couple of weeks.  For the first time today, we have seen Special Forces units and Hummers and armored vehicles as well as helicopters hovering the areas. 

SCARBOROUGH:  All right. 

QUSPI:  So there has been drastic measures been taking place. 

SCARBOROUGH:  All right.  Thank you so much.  We appreciate that report.  Raid Quspi and also Charlene Gubash.

Now, for more reaction from the Arab world as seen in America, I‘m joined by Salameh Nematt.  He‘s Washington bureau chief for “Al-Hayat” newspapers, and also James Zogby of the Arab-American Institute. 

James Zogby, let me begin with you and get your reaction to the events of today. 

JAMES ZOGBY, ARAB-AMERICAN INSTITUTE:  Well, I‘m just horrified, devastated.  I‘ve known so many Americans who‘ve worked in the kingdom.  I know their Saudi partners, and I know that they‘re devastated, as well.  And the family of this poor Paul Johnson, I know they‘ve suffered enormously during this long ordeal. 

And I think that there‘s just no justification for the barbarity of the act.  And I think that many Saudis, the Saudis I spoke with feel exactly the same way. 

But let me just make a point here, Joe, about the thousands of Americans whose work in the kingdom.  I‘d go over and see them.  I‘ve done -- I have a weekly television show on one of the Arab television networks, and I‘ve done the TV show with them because of my concern for them. 

And I think this is a difficult time for them.  They‘ve witnessed one of their colleagues murdered in this brutal way.  And we—you know, we have to recognize the perilous situation they‘re in and be thankful the Saudis are finally acting.  And I hope acting in a vigorous way and will continue to act until this evil is rooted out.

The partnership between the two countries has been a great one, and I think that now the partnership has to be strengthened so that these—these terrorists don‘t win. 

SCARBOROUGH:  And the Saudi Crown Prince Abdullah certainly agrees with you.  And he warned that the militants who murdered Johnson earlier today were going to be facing tough times ahead.

He said, “Be assured that the kingdom has enough men whom you haven‘t seen so far but within the coming days, you will see them.” 

Salameh, let me ask you, is the house of Saud in danger of facing the type of revolution that the Shaw of Iran faced in 1979? 

SALAMEH NEMATT, WASHINGTON D.C. BUREAU CHIEF, “AL-HAYAT”:  I don‘t think there‘s a fear of revolution but there is no doubt that the—the murder of Paul Johnson is part of a terror campaign that is waged by al Qaeda and its affiliates. 

They are targeting first the regimes that are ruling in the region.  Saudi Arabia is part of that, and the west.  And what—the main target is to sever the relationships between Saudi Arabia and the West, because they want to reclaim that country. 

These—these terrorists are similar to Taliban in—in Afghanistan.  They want—they‘re seeking power, and they believe that by undermining the ruling family in Saudi Arabia they can gain power, especially if they succeeded in creating the rift with the United States and Saudi Arabia, undermining that country and maybe convincing the Americans to look elsewhere for oil resources and achieving their purpose. 

This is their strategic goal, and as such the Saudis here targeted as much as the—the Americans and the west. 

SCARBOROUGH:  And—and how—how likely is that, that al Qaeda and other terror groups could actually destabilize the Saudi government, drive foreigners out of there and in the end, lead the Saudi royal family being overthrown?

ZOGBY:  I don‘t—you want to go, Salameh? 

NEMATT:  I don‘t think that they can achieve that unless the United States actually gives up on its alliance with Saudi Arabia. 

ZOGBY:  Right.

NEMATT:  If they do give up this relationship, this strategic relationship, then they‘re weakening the Saudi royal family and undermining their credibility internally and internationally.  Most of the Saudis won‘t accept that.

Unfortunately, there is some sympathy for these terrorists in Saudi Arabia, and mainly because there is a lot of disenchantment with the lack of democracy in Saudi Arabia, the lack of free forums.  But this is by no means a justification. 

I don‘t think there is any Saudi who just wakes up in the morning and decides to go and commitment such a barbarous act.  I think there are organizations are financed and funded, and they‘re provided with logistical support to carry out these crimes.  And I think the Saudis...

SCARBOROUGH:  All right, got to...

NEMATT:  ... are fighting as hard as they can. 

SCARBOROUGH:  We‘re going to have to leave it there.  Salameh and James Zogby, thank you so much for being with us.  And we‘ll be right back in a minute. 

(COMMERCIAL BREAK)

(NEWS BREAK)

ANNOUNCER:  Welcome back to a SCARBOROUGH COUNTRY special report. 

Once again, Joe Scarborough.

SCARBOROUGH:  The terrorists who killed Paul Johnson sent a chilling message to the world about their brutality.  But their intended audience is much smaller, about 30,000 American workers in the Saudi kingdom.  They‘re the engineers, the technicians and the executives who guarantee the free flow of oil, the oil that powers America‘s and the world‘s economy.  So what happens if American workers flee their increasingly dangerous situation?

We have Lawrence Kudlow.  He‘s in CNBC‘s “KUDLOW & CRAMER.”  Also, we have Mike Battles, who co-founded the security firm Custer Battles and who‘s worked as a CIA operative.

Let me begin with you first, Lawrence Kudlow.  Al Qaeda is trying to destabilize Saudi Arabia and the world economy.  Do you think the attack today may help them succeed?

LAWRENCE KUDLOW, “KUDLOW & CRAMER”:  Well, I don‘t know.  I think I got to give the Saudi security forces some credit because they were able to nail that guy and some of his assistants.  We‘ll learn more as time passes.  They had quite a large sweep.  Police, fire, security forces, U.S. FBI was involved.  Hopefully, more of that‘s coming.

But I think what you said earlier is right.  Basically, they can‘t get to the pipelines because there is tremendous security around the Saudi pipelines, but they can get to the apartment houses and the dormitories to go after people who are running the pipelines.  And of course, the big problem on that is there are terrorist agents on terrorist sympathizers inside those residential compounds, and they‘re the ones who tend to let them in, and that‘s exactly where the undercover work has got to operate.

SCARBOROUGH:  Larry, what‘s this going to do to the oil prices, not only on Monday, but also, obviously, for the rest of the summer, when more Americans are out traveling around than ever?

KUDLOW:  Well, I think we already put a big risk premium on oil prices.  And I think we‘ve been seeing oil slip down.  The Saudis have been true to their word.  They‘ve increased their oil production by some two to two-and-a-half million barrels.  They‘re moving in on ten million barrels a day, as they promised, and I think that‘s been a big help.  The issue here, Joe, is at this point, can the terrorists actually get to the pipeline and disrupt operations?  That‘s where the rubber meets the road.  They achieved that goal in Iraq, although the volume of pumping is much smaller.  The question is now, can we keep them out of Saudi oil pipes?

SCARBOROUGH:  But Larry, what happens now if the situation on the ground for Americans working over in Saudi Arabia becomes so dangerous, so untenable that they have to leave?  What kind of impact does that have on the free flow of oil out of Saudi Arabia and across the world?

KUDLOW:  It‘ll have a negative impact.  There‘s no question about that.  But I think here, you know, we get to the heart and soul of this battle, and I think we should not hesitate to put American special operatives on the ground, FBI people, CIA people.  I think we should help teach the Saudis.  The kingdom is under threat right now.  The kingdom‘s very survival is being threatened.  It looks like they‘re getting wise and they‘re beginning to defend themselves.  They‘re going to need U.S. know-how how to do it, and I think that‘s where we have to go.  And we‘ve got to try to keep the men and women on the ground operating these pipelines.

SCARBOROUGH:  Now, Mike Battles, you‘ve worked in Saudi Arabia and Iraq, trying to protect not only Americans but also Western workers.  Talk about the situation in Saudi Arabia.  And is there anything the United States government can do, working in concert with the Saudis, to protect Americans, or as I asked earlier, are American workers simply at the mercy of al Qaeda terrorists?

MIKE BATTLES, CO-FOUNDER, CUSTER & BATTLES:  There are certainly ways to identify, quantify and mitigate the risks to workers working in Saudi Arabia, but that may not work in the short term.  It‘s going to take a little bit longer.  Bear in mind that the Wahhabi fundamentalists in Saudi Arabia have the kingdom on the ropes, and have for 30 years.  It‘s just in recent years that we‘ve really have paid attention to it because the demographics have shifted so much.  You got 70 percent of the populace under age 35, over 50 percent unemployment and uneducated.  Every try to reason with a sophomore at Berkeley?  It‘s almost impossible.  And now you‘ve got the riled masses angry at the American foreign policy.

The problem that we really see is the economic impact could be catastrophic because if it causes $100-a-barrel oil and mass inflation in the States, it can be difficult.  And it‘s really difficult to get most moderate Arabs to participate in violent terrorist activity.  The vast majority of Muslims don‘t support that.  But they‘re still angry with the United States and our foreign policy and so economic...

SCARBOROUGH:  So Mike, what do you do?

BATTLES:  ... jihad is an easier sell...

SCARBOROUGH:  Sure.  So what do you do to fight against economic jihad?

BATTLES:  You—we try the best we can to keep the free flow of oil coming out of the foreign sources that we are dependent upon.  We make sure that the Saudi government has the ability to continue to increase output until we can get Iraq on line.  And we look for African sources of oil.  We look for some more out of Eastern Europe, and we try to change that balance as quickly as possible.

KUDLOW:  You know, Joe...

SCARBOROUGH:  Lawrence...

KUDLOW:  One of the...

SCARBOROUGH:  Go ahead, Lawrence.  Wrap it up.

KUDLOW:  Let me make a point here.  One of the most extraordinary things in the last 24 hours was Vladimir Putin‘s statement that the Russian secret service told us that Iraq, Saddam Hussein‘s Iraq, was mobilizing for attacks on the United States.  That‘s from a guy who opposes the war.  Now, that proves the point that there were connections between al Qaeda and Saddam Hussein.  But more to the point, Bush has a good relationship with Putin, and we‘ve got to operate the Russian oil fields to much greater capacity.  Right now, one of the leading companies is virtually closed down, Yukos (ph), because their former CEO has been jailed and he‘s on trial, and there‘s $2 billion or $3 billion of back taxes that could shut this huge company down.  We need to get Russia to move up to 10 or 11 million barrels a day.  That is something that could be done through diplomatic negotiations, and it would be in the best interests of Russian economy.  That would be a great place to start.

SCARBOROUGH:  Lawrence, economists have been saying for years, for decades now, that Russia and the former Soviet Union has a tremendous amount of oil and other natural resources that simply aren‘t being used.  So—hey, Lawrence, thanks a lot.  I appreciate you being with us.  Mike Battles, also appreciate your insight.

And coming up next on this SCARBOROUGH COUNTRY special report, the motive for murder.  Is it all about destabilizing Saudi Arabia and the world economy?  That‘s coming up next.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  My heart breaks for the Johnson family and for all of Paul‘s friends.  And the brutality of it is unbelievable.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

COLIN POWELL, SECRETARY OF STATE:  If these reports are true about Mr.  Johnson, we, of course, totally condemn this act.  It‘s an action of barbarism.

(END VIDEO CLIP)

SCARBOROUGH:  Since 9/11, the Saudi kingdom has been under increasing scrutiny domestically from both sides of the political aisle.  So, many of you are wondering, how is the murder of Paul Johnson doing going to affect our relationship with the Saudis?  We‘ve got Republican congressman and ally of George Bush David Dreier from California.  We also have Jessica Stern.  She‘s author of “Terror in the Name of God: Why Religious Militants Kill.”

Let me begin with you, Congressman.  Many Americans have been upset with the Saudis‘ relationship with terrorists since 9/11.  Do you believe they‘re doing enough to stop the type of killings that we saw today?

REP. DAVID DREIER ®, CALIFORNIA:  Well, Joe, let me first say that, obviously, our thoughts and prayers are with the Johnson family.  There‘s no way that we can overstate the degree of anger and outrage that has been shown.  You just saw it there from Colin Powell.  President Bush was very strong.

Obviously, the relationship with—between the United States and the Saudi government is a very important one.  They have been victims of terror.  And I think the statements that were made—for example, the friend of Paul Johnson‘s who said—a Muslim friend of Paul Johnson who put the message out that he would curse in his prayers the person who is holding Paul Johnson—and so, there obviously is division within the Muslim world.  And when I say division,, it‘s obviously a very small group of people.  But I think that the relationship with the Saudi government is, in fact, strengthened because we join with our resolve.  And obviously, Adel al Jubeir made it very clear that we are going to work together.  And when asked the question today, Joe, whether this was a crime against the United States of America, his response was this is a crime against humanity.  And obviously, we‘re united with the Saudi...

SCARBOROUGH:  David...

(CROSSTALK)

SCARBOROUGH:  David, why did they let this guy out of prison?

DREIER:  Well, listen, I mean, obviously, I don‘t know.  I mean, they used the term “good behavior” in describing why he was let out of prison.  And obviously, we all hope that, you know, this never happens again. 

They‘re clearly part of the effort, Joe, to have brought this to a head.  He‘s the No. 3 guy tied to al Qaeda, and he‘s now dead.  And we thank God that this guy is dead.

SCARBOROUGH:  Jessica Stern, let me bring you in here.  Obviously, al Qaeda‘s top leader, as David Dreier said, in Saudi Arabia was believed to be killed in the firefight in the capital Friday, shortly after the beheading.  And now, of course, we have confirmation of that.  How big of a defeat is that for al Qaeda and terrorists in the Saudi kingdom?

JESSICA STERN, AUTHOR, “TERROR IN THE NAME OF GOD”:  I don‘t think it is much of a defeat.  I think that it‘s very likely that that man will be replaced rather quickly.  Al Qaeda has really become a movement, as I‘m sure many of your guests have said.  It‘s spreading beyond the original organization to include many organizations, and individuals even, acting on their own, creating their own cells, claiming to act in al Qaeda‘s name.

So I‘m afraid it really gets down to the question that Rumsfeld asked in his leaked memo: Are we killing and capturing them as quickly as they are reproducing themselves, as the radical clerics are producing new ones?  And I think the answer is no.

SCARBOROUGH:  Jessica, let me ask you if we‘re playing into their hands by giving them this much publicity.  Obviously, they could have just killed Paul Johnson several days ago, issued a statement, and wouldn‘t have got this much press not only in America but across the world.  Are we helping them, in effect, and other media outlets helping them, in effect, recruit new members by playing into this story where they set this deadline, the news agencies across the world follow it for several days, and then when he‘s beheaded in a very gruesome manner, we all jump on the story?

STERN:  Yes, and I think it—we are.  It can‘t be helped, however.  They are very clever about this.  Terrorists have become extremely clever about how to use the media to their advantage.  And of course, we are putty in their hands,, unfortunately.  It‘s such a horrifying story, such a grisly murder that, of course, people want to know about it.  They want to talk about it, so...

SCARBOROUGH:  Well, David Dreier...

DREIER:  Joe, let me just say...

SCARBOROUGH:  David...

DREIER:  Let me just say that, clearly, this is something that, obviously, they have tried to manipulate.  I‘ll tell you one thing.  Based on the reaction that we saw standing on the tarmac with the president of the United States, based on the reaction that I and my colleagues from the United States Congress have had, based on the reaction of the leadership in Saudi Arabia and throughout the world and within the Muslim world, I think that dragging this out, seeing him blindfolded, seeing him state his name, is, in fact, strengthening our resolve to ensure that we have a victory in this global war on terror.  We know it‘s ongoing, but I think this rededicates all of us to ensure that this doesn‘t happen again.

SCARBOROUGH:  So what does Congress do to make sure that this doesn‘t happen again and make sure that Americans that are working in Saudi Arabia, not only for the benefit of the American economy but also the world economy, can do that and know that they can come back home safely?

DREIER:  Well, there are a couple of things.  And I will tell you, today we passed out the Homeland Security appropriations bill, a very important measure, reminding us that as tragic as this is—and Paul Johnson was an American citizen—we have succeeded since September 11 of 2001 at keeping this off of American soil.  That‘s something about which we can all be proud.  On Monday...

SCARBOROUGH:  David—David, let me—let me hold you—hold you over because we‘ve got—we‘ve got to go to a break, but we‘re going to come back with both you and also Jessica Stern in just one minute.

(COMMERCIAL BREAK)

SCARBOROUGH:  We‘re back with Republican congressman David Dreier from California and Jessica Stern.

Jessica, the Saudis have been telling us for years that they‘re doing everything they can to crack down on terrorism inside the Saudi kingdom.  Do you buy that?

STERN:  Well, they may have been trying to crack down on terrorism inside the Said kingdom, but I can tell you that I heard for many years from jihadis that I was interviewing that they were getting a lot of money from Saudi Arabia.  It was no secret.  They were very proud that they could go to Saudi Arabia on fund-raising missions, and they came home successful.

SCARBOROUGH:  And David Dreier, respond to that.

DREIER:  Well...

SCARBOROUGH:  Obviously, fund-raising—al Qaeda gets a lot of money from the Saudi kingdom.

DREIER:  You know, we obviously know that there was a history.  I mean, Usama bin Laden‘s base in Saudi Arabia is obviously well known.  And as I said, a lot of fund-raising.

You asked me just before we went to the break, Joe—and that needs to come to an end.  You asked me about what United States Congress is doing.  We passed out the Homeland Security appropriations bill today.  On Monday, in the Rules Committee, we‘re going to be considering the Department of Defense appropriation bill, a very important measure, which again is going to underscore our strong commitment on the national security side.

You were talking earlier with Larry Kudlow about the energy issue.  You know, we have just passed out a series of energy bills, and one of the things we need to do is we need to vigorously pursue not only that Russian oil about which Larry was speaking, but also, we need to pursue domestic energy self-sufficiency.  And that‘s why exploration in the Arctic National Wildlife Refuge is clearly an option that we need to consider.  So there are a number of steps that we can take through policy to do this.  But I would just underscore again the enact what we‘ve seen over the last several days has angered and outraged so many that I believe our resolve is going to be even stronger today than it has been.  And it‘s already been...

SCARBOROUGH:  Jessica...

DREIER:  ... as you know, Joe, very strong.

SCARBOROUGH:  Jessica, you do you believe that‘s the case?  Because I keep saying, you know, after 9/11, America responded, obviously going into Afghanistan and then Iraq, and after these attacks, Nick Berg, Americans seem to respond aggressively...

DREIER:  I can‘t hear anything...

SCARBOROUGH:  But it doesn‘t seem that these terrorists get that.

STERN:  Well, I think it does strengthen our resolve, but unfortunately, pictures like that strengthen their resolve, as well.  Bin Laden himself told us that his followers go for a strong horse, and I‘m afraid that a picture that makes it clear that this group is humiliating an American citizen in the most gruesome possible way, humiliating all of us, that‘s very exciting, unfortunately, to the terrorists.

SCARBOROUGH:  All right, Jessica Stern and David Dreier, thank you so much for being with us.

Again, American Paul Johnson murdered today in Saudi Arabia.  Outrage in Congress, across the nation and across the world.  We‘re going to have more coming up on this SCARBOROUGH COUNTRY special report.  Stick around.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  The murder of Paul shows the evil nature of the enemy we face.  These are barbaric people. 

(END VIDEO CLIP)

JOE SCARBOROUGH, HOST:  Tonight, a SCARBOROUGH COUNTRY Special Report:

murder in Saudi Arabia.  American Paul Johnson is beheaded by his al Qaeda captors, and Saudi officials follow with swift justice, killing al Qaeda‘s top man in the kingdom who took responsibility for the murder.

So who was Paul Johnson? 

We‘re going to be hearing from New Jersey‘s U.S. Senator, Jon Corzine, who has been in close contact with the Johnson family. 

Plus, reaction from the Arab world.  Have they condemned the cold-blooded murder or glossed over it like they did Nick Berg? 

And what, if anything, are they going to do to protect innocent American civilians? 

(BEGIN VIDEO CLIP)

ABDEL AL-JUBEIR, SAUDI FOREIGN AFFAIRS ADVISER:  The people of Saudi Arabia are outraged by the cruel and cold blooded murder of this innocent man.  

(END VIDEO CLIP)

SCARBOROUGH:  The Saudi government was quick to condemn the murder, and killed the man be responsibility for it.  But are the Saudis really our friends, and can we really trust them?  Gerald Posner and Congressman Dan Burton will be here.

All that tonight on a special edition of SCARBOROUGH COUNTRY. 

ANNOUNCER:  This is a SCARBOROUGH COUNTRY Special Report.

SCARBOROUGH:  So what do we know about Paul Johnson, the 49-year-old family man from New Jersey, a civil engineer trying to make a living in a land, according to his family, that he considered home. 

I‘m joined now by Senator Jon Corzine.  He is, of course, a Democrat from New Jersey who has been in close contact with the Johnson family this week. 

Senator, thank you so much for being with us tonight.  Tell me about your discussions with this family throughout the week.  

SEN. JON CORZINE (D), NEW JERSEY:  Well, the family was interested in making sure that American authorities, that Saudi authorities, were doing absolutely everything that they  possibly could.  Have we turned over every leaf of possibility of rescuing and saving their loved one?  And a perfectly reasonable request, and certainly, those of us—not just myself, but Senator Lautenberg and a number of public officials—were speaking with the FBI, the State Department, the folks on the ground in Saudi Arabia, and the Saudi Arabian officials to try to encourage every detail to be followed to its greatest possible extent.  

SCARBOROUGH:  So Senator, obviously, the family asked you, they made a public plea that the United States government and the Saudi government do absolutely everything possible that they could do to bring their father home.  And you are confident tonight that, not only did all branches of the United States government, but also the Saudi government—you are confident that the Saudis and the U.S. government did everything they could possibly do to rescue Mr. Johnson?

CORZINE:  Well, I am quite convinced our government did, and I am quite convinced that the Saudi government had nothing to gain from the outcome that came to pass.  They would have been well served by a rescue, by a different outcome.  And so, there is no way that I think anyone rationally would have sought to have this be the outcome.  They would have tried to do everything they could, and I think they did.

SCARBOROUGH:  Senator, as you know, the Saudi regime has had a lot of critics here in America and across the world since 9/11.  Obviously, 15 of the 19 hijackers came from Saudi Arabia; bin Laden also, the Saudi nationalists. 

Do you believe that the Saudi government is doing everything that they can do to crack down on al Qaeda and terrorists that are being funded in Saudi Arabia? 

CORZINE:  Well, I don‘t know whether I can make a 100 percent statement that they are doing everything.  I think their policies and their attitudes today are entirely different than they were two years ago or five years ago or a decade ago.  

SCARBOROUGH:  In what way? 

CORZINE:  Well, I think they now recognize that the existence of the royal family is still is very much at stake, itself.  So, I think they have a mutual interest in resisting and turning back, fighting al Qaeda and those that would try to overthrow the royal family.  So that, whether it‘s for good reason or bad reason, I think they have changed, dramatically, their policies. 

Now that said, they allowed this cancer to grow to a very serious extent, and to some extent, it‘s out of their control.  They need to take very strict and stern steps over a long period of time to rid themselves of this radical Islam minority sect within their society.  They need to ask for help.  I mean, I‘m troubled by the fact that the United States is not doing everything it should be to protecting our expatriates on the ground. 

I think they need—the Saudi family—needs to bring  reform to this society.  A very narrow segment of society is doing very well, and a broad segment is actually living in poverty.  So there is a whole host of issues that need to be addressed here, not just a single dimensional one.   But I believe the Saudi family now understands that their own existence is on the line here.  And so I think their interests are more aligned with ours than they have been historically.  

SCARBOROUGH:  Senator, as much as anybody in the United States Senate or in the House of Representatives, I think you are qualified to talk on economic issues and how something like this could affect the world economy, because of your background. 

Are you concerned that the continued attacks against Americans, British, and other Westerners working in Saudi Arabia is going to have a negative impact on the flow of oil out of that country; going to have an impact on oil futures, world market, that could cause economic chaos, not only here, but across the world?

CORZINE:  Joe, I think that we are already seeing in the price run up, some people would say spike, that we have had over the last two months or three months -- $2 gasoline prices—is a direct result from expectations that that kind of outcome could come to pass.  I think that we have seen the terrorists or the antagonists on the ground in Iraq attack oil fields.  There is no reason to expect that they wouldn‘t try to do the same thing in Saudi Arabia.  I think that‘s reflected in oil prices, and I think it‘s a grave danger to the economic health of the globe.  Saudi Arabia is the warehouse of oil for the globe. 

SCARBOROUGH:  All right, Senator Jon Corzine, we greatly appreciate you being with us tonight. 

CORZINE:  Thank you.  

SCARBOROUGH:  Still ahead, we‘re going to bring you the world reaction to the murder of Paul Johnson. 

Next, we‘re going to be discussing whether or not America can trust Saudi Arabia after their repeated failings in the war on terror.  Are they really on America‘s side? 

(BEGIN VIDEO CLIP)

AL-JUBEIR:  The people of Saudi Arabia are outraged by the cruel and cold-blooded murder of this innocent man.  His murder has shaken us to the core.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES:  All Americans can be certain that President Bush‘s resolve in this war, America will hunt down these killers, find them one by one, and destroy them. 

(END VIDEO CLIP)

SCARBOROUGH:  Since September 11, Americans have wondered how our supposed ally on the Arabian Peninsula could export terror.  Lately, despite American urging to crack down on terrorism, it has come home to Saudi Arabia.  And now, American Paul Johnson is dead. 

So should Saudi Arabia be considered a friend or a foe?  With me now to talk about that is Representative Dan Burton.  He‘s from Indiana.  We also have Mamoun Fandy.  He is the author of  “Saudi Arabia and the Politics of Dissent.”  And we also have Gerald Posner, the author of “Why American Slept: the Failure to Prevent 9/11.” 

Dan Burton, let me begin with you.  I want to get your reaction to what happened earlier today in Saudi Arabia, and answer that question: are the Saudis doing absolutely everything they can do to protect Americans from terrorism over there? 

REP. DAN BURTON ®, INDIANA:  The Saudis are not our friends, Joe.  The Saudis have a business relationship with us.  We‘re the largest consumer of energy and oil in the world, and they sell a lot of oil to us.  And we need their oil, so we have this relationship. 

But as far as them being our friends, no.  I led a cordial (ph) over there last year, and I can tell you for a fact that I don‘t see any signs of friendship.  They have been supporting Wahhabism through their madrasas for a long, long time, and in those schools that they are supporting, they teach hatred for Christians and Jews and other Arabs—even Muslims that don‘t agree with them.  And they‘ve been supporting them.  They‘ve given, over the past 10 to 12 years, over $4 billion to various terrorist organizations.  Fifteen of the 19 terrorists that attacked the World Trade Center were from Saudi Arabia.  Osama bin Laden is from Saudi Arabia.

So, in that society, they have created their own problems.  The terrorists have been trained from birth in that society, and I believe that there is al Qaeda sympathizers even in the royal family and the military and the police.  

SCARBOROUGH:  Gerald Posner, earlier this evening, a spokesman from the Saudi Arabian government said, The people of Saudi Arabia are outraged, but yet, we heard last week of a poll that said, 50 percent of Saudis actually support Osama bin Laden‘s actions over the past several years. 

Are the Saudis shocked and outraged, or are half of them rooting for the murder of as many Americans and Westerners as possible? 

GERALD POSNER, AUTHOR, “WHY AMERICA SLEPT”:  Well, I‘ll tell you, I was surprised actually, Joe, that only 50 percent in that poll supported bin Laden‘s activities.  The other 49 percent probably said he wasn‘t doing enough against the Americans.  No, I think Congressman Burton is exactly right.  He knows this issue very well.  He has been outspoken on it.  With friends like this, who needs enemies? 

And I think that what the Saudi spokesman said, they are outraged, they are, because this puts them in a very uncomfortable position.  The problem here for the Saudis is—look, there was recently a Royal Canadian Mounted Police intelligence report that is now coming out that has been the subject of six months of investigation that said, the Saudis through intermediators, are still, today, supplying $1 to $2 million a month to al Qaeda organizations.  And, as Congressman Burton knows, when you say, the Saudi spokesman said today they were outraged, Saudi government representatives, including Prince Bandar, have come before Congressional committees, including Congressman Burton, they have lied to us in the past.   They have looked us right in the face and told us lies; we know that those are lies.  We have never looked them back, because of this oil relationship, and been assert and firm with them as we should be.  We said, you‘re either with us or against us in the war on terror.  They have not been with us.

SCARBOROUGH:  Well, that apparently does not apply to the Saudis. 

I want to read a quick timeline of terror attacks in Saudi Arabia: In

May 2003, a suicide bomb attack killed 35; in May of this year, gunmen

attacked an American based company, killing 6 Westerners and a Saudi; and

on May 22, gunmen shot a German in Riyadh; late May terrorists attacked an

oil compound in Khobar, killing 22; and on June 2, BBC reporters were shot

·         one was killed, one was injured; and then, of course, today another vicious murder of a Westerner.

Mamoun Fandy, let me ask you:  Do you believe that what we are seeing over the past—well, actually, this goes back to May—again, it goes back to May of 2003.  Do you think we‘re beginning to see an insurrection against the House of Saud that may lead us to where Ayatollah Khomeini revolution in 1979 lead Iran? 

MAMOUN FANDY, SENIOR FELLOW, U.S. INSTITUTE OF PEACE:  Well, not necessarily so.  I think what we are seeing is that, probably, the war on terrorism pushed the terrorist to the Middle East, again, to Iraq, to Fallujah, and to Saudi Arabia, and Algeria, and other places; that these are practically—the terrorists could not get at America.  Now, they are trying to undermine regimes that they think are protected by American in the region.  So, in a way, I don‘t think—I have visited Saudi Arabia while I was doing the research for my book many times, and I followed these groups very extensively—and what I noticed is that you don‘t have a massive movement in Saudi society that can, with broader support, that might allow for an Iranian style revolution. 

What you have is really the thugs of Osama bin Laden and al Qaeda and their sympathizers who are out to undermine.  Again, the object is the West; the objective is the oil pipelines; the objective is undermining anybody who does business with the West in the region. 

SCARBOROUGH:  Dan Burton, you know, Mamoun brings up a very good point.  Obviously, there were attacks in America from 1993, the first World Trade Center bombing, to September 11, obviously, 2001.  When we clamped down in America, the attacks started going to the Middle East, of course, as we saw in Madrid earlier this year. 

Do you think al Qaeda is attacking in Saudi Arabia now because they have been cut off in  America, their leader in Iraq is saying that Iraq may be a lost cause for them, and now they are turning their attention to the Saudi Kingdom?

REP. DAN BURTON ®, INDIANA:  Well, they know our energy, in large part, comes from Saudi Arabia, and they would like to drive us out of there, and they would like to make us—put us in a position where we‘re not getting our energy at a price we can afford.  They like to drive the price up.  But as far as the royal family being supportive of the terrorist movement, there is all kinds of historical facts for that, Joe.  And, in addition, when the attack took place in the Khobar Towers you just talked about, they surrounded the place, and yet they let three of the terrorists get away.  

So I think the royal family—at least some in the royal family—are still involved in this terrorist movements, and they have been training these kids from birth in these madrasas and Wahhabism, which I said before, teaches them to hate Christians, Jews, and others. 

SCARBOROUGH:  Well, Dan, as you know, obviously during the Khobar Towers investigations, we in Congress weren‘t allowed to confront the evidence, to dig into the evidence that we needed to dig into.  And also, obviously, the princes in Saudi Arabia simply refused to go after those schools and get them to stop teaching hatred towards Jews and towards Westerners.  

I want to ask you, Gerold Posner—a very interesting thing was said earlier from NBC‘s Jim Miklaszewski, he said, actually, that there are some American government officials who are raising eyebrows over the timing of al Qaeda‘s—the killing of al Qaeda‘s top man in Saudi Arabia.  They find it suspicious that soon after Paul Johnson was killed, Saudi forces swooped in and killed the top al Qaeda leader in Saudi Arabia, suggesting that, perhaps, they knew where they were all along.  

POSNER:  Well, you know, Joe, the interesting thing is that it‘s hard for me to imagine the Saudis would not have wanted to stop this from taking place.  It‘s an embarrassment to them, all the way around.  They don‘t want an American killed on their soil.  It shows the security forces are weak.  They haven‘t penetrated al Qaeda completely.

I talked to a security analyst tonight in Washington who said that the thing that he was most interested in, he would love to have a DNA test done on those dead terrorists to make sure they are indeed who they claim they are; that the Saudis aren‘t just planting three bodies in a grave and giving them a proper Muslim burial and claiming they just removed the head of al Qaeda inside Saudi Arabia when they really didn‘t have anybody at all.  So that would be an interesting follow-up to find out. 

But I must tell you, it goes back to what Congressman Burton was saying—and you know this from Saudi obstructionism on earlier cases years ago.  The royal family is split.  It‘s not just—it doesn‘t move as one large group and everybody agrees with it.  There are radicals inside the family; there are those who are supportive of terror, who don‘t like the United States; and there are others who are willing to moderate the family over time.  There is a conflict in there.  

But those who are in powerful positions, who clearly support the terrorists, there has not been one case or one arrest by the Saudi government of any of the financiers, of any of the princes.  They haven‘t even had their wrists slapped over the millions of dollars sent out—none of them.  And that includes whether it is Naif, the interior minister, or whether it has to be Prince Salman, who is the governor of Riyadh who had a conversion to fundamentalism in the mid-90s, whose son Prince Salman was name by a terrorist, who we caught, as one of those who was helping al Qaeda for years.  None of this has been looked into aggressively by the Saudis. 

I think that that at some point, some American administration, whether the Bush administration or whether it is a follow-up administration to the Bush administration, is going to have to get tough with the Saudis and actually say, it‘s time to stop this game where you sit on both sides of the fences and play both sides against the middle.  You actually have to choose here.  

SCARBOROUGH:  Mamoun Fandy, is that exactly what is happening in the Saudi government?

They are still playing, in 2004, both sides of the fence.

FANDY:  I really sort of, I beg to differ with Gerald on this one.  I

think they cannot afford to play both sides of the fence any more.  What

you have, you have to look at really sort of at the region wider than just

Saudi Arabia.  You have hot spots.  You have terrorists in the territory,

in the Palestinian territories, you have terrorists in Iraq, you have

terrorism all over.  And I think most regimes—it‘s not just Saudi Arabia

·         most regimes in the region feel under attack, and they have no choice but to side with the United States, even if they don‘t like the United States on this one.  Because, otherwise, you have, bin Laden and his boys can take over one of the most important countries in the region with oil resources and all of that. And I don‘t think, even if the Saudis allow it, not many regional players would allow it. 

SCARBOROUGH:  Let me bring in Pat Buchanan. 

Now, Pat, Gerald Posner said earlier that we should check the DNA of these men who were supposedly killed earlier tonight, who were supposedly leaders of al Qaeda.  Now that sounds like a conspiracy theory, until you remember the “Time Magazine” article that actually talked about three Saudi princes who were named by a terrorist when he thought, you know, U.S.  forces flew him around in circles, landed him, made him believe that they landed him in Saudi Arabia to try to scare him, and then he quickly mentioned three Saudi  princes names.  He said, just talk to these three Saudi princes—they‘ll take care of everything. 

Of course, you know how that story ended.  All three of those young Saudi princes died of mysterious  circumstances within the next few months.  Can we trust the Saudi government?  Can we trust the Saudi leaders who have been linked to one of the most violent extreme strains of Islam since the House of Saud was formed in the 1700s? 

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  Look, the Saudi leadership and the royal family are infiltrated, and there are members of that family, I‘m sure, who are deeply enthusiastic about Osama bin Laden, who detest the American as infidels who would like us out of there. 

But Joe, we have to ask ourselves: what exactly is the alternative to

the present monarchy?  If that government goes down, the alternative is

Osama bin Laden and his friends.  If they take power, there is going to be

a strategic disaster for the United States.  Well, we ought to put quiet

pressure on the Saudis.  I think this constant berating of Saudi government

·         undermining it, attacking it, calling for cutting it off, and calling for public pressure on it.  If we succeed in knocking this government over, Joe, look what happened every time we have done it.  Egypt we got Nassar;

Libya we got Gadhafi; in Iran the Ayatollah; and Saddam Hussein and the Ba‘athist Party in Iraq.   So I think we ought to think long and hard before we start denouncing the government, and then say we got to undermine it, because I agree with your earlier speaker. They are on our side out of necessity. 

SCARBOROUGH:  Dan Burton, I‘ll give you the final word.  

BURTON:  Pat, we need to put all the pressure we can on them.  Obviously, we do need them now because we need the energy from that part of world, and we can‘t led the radical terrorists take over.  But at the same time, we have to do something to make sure they are more active.  You can‘t have them continue to let terrorists get away like they did in Khobar Towers.  You can‘t let them continue to fund terrorists organizations.  We have got to put a lot of pressure on them while working with them.  And we need to do one more thing, Joe, and that is really move toward energy independence.  It‘s high time we did that.  

SCARBOROUGH:  All right, thanks so much for being with us, Representative Dan Burton and Gerald Posner.  Pat Buchanan and Mamoun Fandy, please stick around.  We‘ll be right back, because coming up on our Special Edition of SCARBOROUGH COUNTRY we‘re going to see if the rest of the world is as outraged with Paul Johnson‘s murder as we are here, in America.  We are going to take a look at how the Arab world is reacting to that brutal act next.  Plus, I‘ll be talking to Pat Buchanan about what today‘s murder means to Bush, to Iraq, and to the war on terror.

(COMMERCIAL BREAK)  

SCARBOROUGH:  Up next on our Special Edition of SCARBOROUGH COUNTRY, we‘re going to bring you world reaction to the brutal murder of Paul Johnson.  Two Arab reporters are here, live, but first, let‘s get the latest headlines from the MSNBC News Desk.  

CHRISTY MUSUMECI, MSNBC ANCHOR:  Hello, I‘m Christy Musumeci -- 29 past the hour, here are the headlines: 

The body of Paul Johnson, the American engineer kidnapped, was found outside the Saudi Arabian capital today.  Three grisly photographs were displayed on an Arabic Web site, confirming that Johnson was, in fact, beheaded.  The 49-year-old was kidnapped last weekend by an Islamic militant group that threatened to kill him by Friday if the Kingdom did not release its al Qaeda prisoners.  Arab television networks are reporting, the leader of al Qaeda in Saudi Arabia was killed today.  Saudi security forces say, Abdul Aziz al-Muqrin and two other militants were killed while they were disposing Johnson‘s body in Riyadh shortly after his death. 

In other news tonight, a final farewell to Grammy Award winning entertainer Ray Charles today.  A private funeral was held in Los Angeles, which included performances by B.B. King, Stevie Wonder, and Willie Nelson.  The Rev. Jesse Jackson and actor Clint Eastwood were among those who spoke at the funeral.  Ray Charles died last week at the age of 73. 

Back to SCARBOROUGH COUNTRY. 

ANNOUNCER:  Welcome back to a SCARBOROUGH COUNTRY Special Report. 

Once again, Joe Scarborough.  

(BEGIN VIDEO CLIP) 

AL-JUBEIR:  We hold you our solemn commitment to pursue the criminals and bring them to justice, and with the help of God almighty, we will.  If the intention of criminals was to shake our resolve, they are mistaken.  We are united as a nation and determined as a people to rid them from our midst. 

(END VIDEO CLIP)

SCARBOROUGH:  Let‘s turn now to reaction from the Arab world.  There was rejoicing in some parts of Middle East when American Nick Berg was beheaded. 

How will the news of Paul Johnson‘s murder be received?