His eyes were bloodshot, and he admitted to feeling "a little lagged." But just 12 hours after returning from the Malta summit, where he met with Soviet leader Mikhail Gorbachev, President George Bush was back at work. As is his routine, he was up at 6 A.M., sipping coffee and reading newspapers in bed with First Lady Barbara Bush. An hour later he was at his burled walnut desk downstairs in the Oval Office. The President worked through the morning and into the early afternoon, skipping lunch.

Barbara Bush took a postbreakfast swim in the White House's heated outdoor pool. She had a mid-morning appointment with industrialist Eugene Lang, whose I Have a Dream Foundation gives disadvantaged children a chance at college educations. Later she went Christmas shopping at the pricey Mazza Gallerie, where Mrs. Bush dropped $10 into a Salvation Army kettle. (Salvation Army bell ringers have been banned from several Washington malls, making her contribution a pointed gesture.)

At 1:40 P.M., just 20 minutes before the President's scheduled Cabinet briefing, PEOPLE managing editor Landon Y. Jones and Washington bureau chief Maria Wilhelm were ushered into the Oval Office. A fire crackled as the President and Mrs. Bush settled onto one of a pair of off-white brocade sofas for a spirited half-hour interview. At times the First Couple held hands; at other times they tweaked each other with gentle good humor. Excerpts of the conversation:

Mr. President, is the Cold War over?

If you mean tanks rolling into Hungary, then yes, it's over. But if you mean is there reason to have a defense force on either side, the answer is yes, there probably is. And don't take it from me. Take it from Mr. Gorbachev too.

Americans are intensely curious about Gorbachev. What insight can you offer about his character?

Well, he's different from his predecessors, with whom I met briefly. He is clearly a more modern man. He can communicate with Westerners very well. He talks about democratic values. How many of the other Soviet leaders have ever discussed that? He's talking about openness, which we all agree with, glasnost, freedom to choose in elections, the right of countries to self-determine, all the things we believe. And not only is he just talking about it, but in the way he's acting in Eastern Europe, why, he seems to be encouraging it. So when he goes to Italy they're yelling "Gorbachev!" Why? Because he is identified, as nobody else in the world today, with moving things toward democratic values and moving things toward a more peaceful world.

You've been in the White House almost a year now and nobody could have predicted the changes—in Eastern Europe, in China, and on and on. Has it been a bit overwhelming at times?

I don't think so. We've been blessed with having a team that is interested in pulling together, and that makes the job of the President very much easier than if you're out there every minute settling disputes between strong-willed people. I had kind of on-the-job training for eight years in a sense, because I was Vice President. I'm not suggesting I don't say a prayer about trying to get the job done, which I do every night. Just do your best, as your mother taught you, or as mine taught me.

Has there been anything surprising about the job?

Surprising? Pick up that phone [pointing to his desk]. There's a surprise every minute. But there are not many revelations where the job suddenly reveals itself as different than I had anticipated. That's because my predecessor was exceptionally generous in including me in on what he did. So, in terms of how the system reacts when there's trouble around the world, that would have come to me as a revelation if I had not been Vice President. But having been Vice President, I can anticipate how the machinery should work.

Mrs. Bush, what's hardest, and most surprising, about being First Lady?

I think the most surprising thing for me has been how much I've loved it. I can hardly wait to get up every morning.

GB: When you get up at 5 A.M.? She does, every day, every day.

BB: Hardest, maybe because I have a small thyroid ailment. The medicine makes you get up. I sleep like a baby and I feel like a million dollars.

What does Millie, the First Dog, think about the Oval Office?

BB: Millie is exhausted. No, Millie loves it. She loves it. She's my shadow. She comes over with George every morning and spends an hour and loves it.

GB to an aide: What, is Millie looking out the window there?

Aide: Yes.

GB: She comes every morning and peers out the window.

When we sat down with you last year, you talked about not wanting to be a prisoner of the White House. You wanted to order in pizza and go out and see your friends and have dinner on the spur of the moment in town. Have you been able to do that?

GB: We had Chinese food.

BB: We're not big pizza eaters. But we like pizza. I don't want to lose all the pizza people.

GB: But we can go out to restaurants here. It's different now though. It's kind of a big deal.

BB: I went out for lunch yesterday to a friend's. I go out a lot.

When you go out do you carry cash?

GB: She's probably got more than I do.

BB: I need yours actually. Prove it.

GB: [Counting.] Let's see, there's about $53. I've had it there for quite a while. It's a good question. Once in a while you need something, and somebody here will go get it if something's broken or you need some batteries or you need something personal.

BB: I always say that to George if we're going out. [In a stage whisper:] "Do you have any money?" Just in case.

GB: For restaurants we do, we carry cash for restaurants.

Mrs. Bush, we love your pearls. There's unanimous agreement that they're great.

They're real. They're real, of course. They're real.

Who gave them to you?

Those real ones?

The real ones.

George bought them. Was there a particular occasion?

[Mrs. Bush fingers the double-strand necklace at her neck.] No, they're not real, I'm kidding!

Sorry, we're gullible. Do you have real pearls?

I have some cultured pearls that George gave me. They're very pretty.

And he gave them to you on a special occasion?

GB: Yes, I'm a romantic devil. I forget when it was. Ordinarily, we don't give presents to each other.

BB: We don't. But I told him once I wanted some, and he gave them to me.

GB: Did I?

BB: You bought them. Very nice ones too. You just forget. You know what George says now and then? I hear him say to someone, "She's wonderful. She doesn't spend a lot of money." And I think, oooh, that's just an invitation. That's not true. George is very generous.

Over the holidays you go shooting with your friend Will Farish in Beeville, Texas. We know you're an enthusiastic sportsman, but we wonder about whether you have any handguns? GB: I don't use a handgun.

Have you ever owned a handgun?

I don't have one. I did have one after the war, but she made me...

BB: I asked.

GB: We had a lot of kids around. And so I had my .38 service automatic and...

BB: I asked. I didn't make him.

GB: She asked that I dispose of it because she was afraid the kids would get ahold of it....But I have some shotguns, a couple of shotguns and a rifle. I skeet shoot at Camp David almost every time I'm up there, and I like quail hunting, and I'm going to do it again this year. I'm not a pistol guy.

The President develops a thick skin and he's probably always had one with regard to criticism. But, Mrs. Bush, how do you react when you see things like Doonesbury?

I don't understand Doonesbury, so pick another example.

GB: Oh, she understands it at times.

BB: I don't think most people understand Doonesbury. I don't pay any attention because I know what's true. I know he's the right man at the right time so I don't pay any attention. Do I get mad? Sort of. But not really. I go swim a mile and move on, fire Anna [a joking reference to Anna Perez, the First Lady's press secretary] and move on.

GB: You can't be in this job and spend any time worrying about what somebody writes about you, if it's bad or even if it's good. You cannot do that. I never felt that way. You know, back when I was in Congress, ready to call a person and ask, "How could you do this to me?" Now it's, hey, you do your thing, I'll do mine. And you cannot spend time worrying about columnists or cartoonists or editorialists or news coverage. You just have to do your job.

BB: I don't like unfair things though—not just about George, about anybody.

Mr. President, you've said that your wife always agrees with you and, frankly, we don't believe that.

Have I said she always agrees with me?

BB: In public. [George Bush laughs.]

Do you ever scold your husband for speaking for you?

No, absolutely not.

Do you have private disagreements upstairs on issues?

BB: You know, we've been married almost 45 years. We were 19 and 20 when we were married, and we've experienced a lot of things together. That doesn't mean to say we agree on everything, but I know, I know what George feels, and I know he feels absolutely convinced and totally dedicated to what he believes in. He's thought everything out carefully. So I'm not going to argue with him about that.

GB: We don't argue about issues.

BB: You know, it takes two to argue, and he won't.

Mrs. Bush, you've always been such an enthusiastic reader. Has your thyroid problem and its effect on your eyes slowed you down?

I don't read quite as much. But I'm not sure if that isn't because I learned the computer this summer and, as George will tell you, I married the computer. I'm loving my little friend.

Are you writing on the computer?

GB: It's one of those lap computers.

BB: I'm having more fun with the lap computer. So, Millie is writing a book. I'm putting everything on the computer, you know, Christmas lists, everything, and I'm enjoying it. It's also very restful for me because with this problem [the thyroid condition], looking down I see everything clearly. Looking up I have a little bit of a problem. So it's like a rest.

Have you read Nancy Reagan's My Turn?

BB: No.

Do you keep in touch with Mike and Kitty Dukakis? Have you spoken to them since Mrs. Dukakis's hospitalization?

BB: When Michael asked the public to give her space, I went along with that. But heaven only knows, both George and I were brokenhearted for her, and for him, that she had this little setback.

The two of you have done such a wonderful job of bringing out family values in the White House. Yet at the same time it must be distressing to you that your daughter, Doro, and her husband, Billy LeBlond, have separated. Can you give us an idea of how your family is coping with that?

GB: We're blessed that we love both of them. They're having marriage problems, and that comes under the heading of their business. And so we counsel our daughter, and we stay very close to Billy's parents, who are good friends of ours. The last thing Doro and Billy need is pontificating from either of us. But if she needs somebody to hold her hand, well, we're there.

BB: And so are her brothers, and so are his brothers and his sisters.

GB: We have big, strong families. And you just put your arm around your kid.

If you had to give your Administration a report card after your first year, what kind of grades would you get?

I wouldn't particularly relish doing that, but I'd say that in some departments we've done very, very well. Still, there's an unfulfilled agenda. So if the report card is graded by total accomplishment, there's plenty left to do. But I think in the area of general handling of foreign affairs, managing to get some things like the ethics legislation, savings and loans, and some other major things through the Congress, why I think we've done real well. But on the other hand we haven't gotten the agenda complete by a long shot. So I don't know how you grade it. But I take great pride in the way the Administration is operating. We've been relatively free of the kinds of things that have burdened others, the kind of infighting or the kind of trying to make yourself look good to the detriment of somebody else. But we've got a long way to go before I will feel satisfied with the, quote, accomplishment, unquote. So we're just beginning. We're only one quarter of the way in.

Is there a New Year's or Christmas wish you have for the country?

It's got to be peace. It's got to be. And then, of course, at home it's got to be helping people, better lives for people.