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THE INDUSTRY scuttlebutt surrounding the sequel to "Babe" has been anything but encouraging. And there has been a lot of pre-release information -- at times it appeared the "Pig in the City" set had more leaks than the Starr grand jury.

The first scandal was the fact that Universal refused to pay Christine Kavanaugh, the actress who provided Babe's voice in the original film, enough to get her back. Then came word of last-minute editing and massive retooling amid early rumors that had the film garnering an unthinkable PG-13. And then, the final straw, the news that James Cromwell's role was little more than a cameo. How could they not keep Farmer Hoggett down on the farm after he had been nominated for an Oscar?

Surely a sequel presented risks. Part of the original's appeal was its freshness, its distinction from anything we had seen before. In "Babe," director George Miller had created a rare gem, one that appealed to both children and adults, was lauded by critics and even was recognized by the Academy of Motion Picture Arts and Sciences with seven Oscar nominations, including Best Picture.

Well, this Thanksgiving, many skeptics will be feasting on crow, because "Babe: Pig in the City" is an absolute delight. Amid the crowded field of holiday releases, this movie stands out from the pack like, well, a pig in the city.

This film picks up where the original left off as Farmer Hoggett and Babe the "sheep pig" return from their triumph at the sheep herding nationals. Babe is wrestling with his new-found fame: "when those who dismissed you as a lousy pork chop now clamor to be in your presence."

When Farmer Hoggett is injured in a farm mishap, Mrs. Hoggett must resort to extreme measures to save their farm from foreclosure. She decides to make a visit to a state fair with her famous pig to collect their "appearance fee." En route, problems arise and suddenly she and Babe are alone in the city.

And what a city -- even though it was filmed in Sydney and we see the distinctive Opera House, it has the feel of Everycity -- with the Hollywood sign, New York skyscrapers and the canals of Venice. Just as the first film seemed to be of another time and place, the sequel has the same feeling -- the city features everything from skinheads to Studebakers.

Magda Szubanski reprises her role as Mrs. Hoggett, replete with rosy cheeks and the chronic slip hanging a few inches below her dress. She proves adept at the slapstick required for the role and it's a good thing, because there's a lot of it. It doesn't hurt that she's amusing even when she's standing still, but the sight of her riding a bike and bungee jumping are worth the price of admission alone.

Mrs. Hoggett and Babe find security in a small hotel frequented by animals and run by Mary Stein, an actress who makes Shelly Duvall look positively pudgy. Mickey Rooney plays her uncle, a clown named Flugly Floom.

Familiar pieces of business from the original "Babe" rear their heads -- the "Bah, Ram, Ewe" secret password, the master's favorite English aire, and of course, the often imitated but never equaled singing mice, who have expanded their repertoire to include Elvis and Edith Piaf. They have their work cut out for them when they encounter a cat choir that's positively heavenly. And of course, we also have the ultimate words of praise from Farmer Hoggett: "That'll do, pig, that'll do."

Roscoe Lee Browne returns as the narrator, as does Ferdinand the duck. (When Babe says he'll be fine in the city because the master's wife is going along, Ferdinand replies, "Great, you'll be in the presence of a serial killer.") E.G. Daily, who is the voice of Tommy in the "Rugrats" television show and movie, provides the voice of Babe here, but the difference is virtually indistinguishable.

Even when he is faced with pure evil (in the form of a hungry pit bull) Babe takes the high road. He ends up doing the piggy-paddle and saving his attacker's life. Apparently, this is the animal equivalent of doing a favor for Don Corleone; suddenly Babe has a godfather. ("Thank the pig," the pit bull tells all the other animals.) When Babe is asked to impart some words of wisdom, he starts small: "Cats and dogs should be nicer to each other."

Cats and dogs abound in this film, representing the city's disenfranchised throngs. Though humans play supporting roles, it's really the animals' movie. There's pink poodle (kind of a Blanche DogBois), a small hungry kitten and a handicapped Jack Russell terrier who gets around in a type of dog wheelchair. The movie is nearly stolen by a family of orangutans and a Capuchin monkey, rich characters who never seem saccharine. Zootie is voiced by Glenne Headly and her partner Bob by Steven Wright.

Special mention must be made of the head of the orangutan family, Thelonious, for whom they may need to establish a special Oscar category. This guy is the monkey John Barrymore -- and that's meant as high praise for both. His performance -- especially the scene in which he insists on getting dressed before leaving the pound -- was a primate tour de force.

Who will enjoy "Babe: Pig in the City"? Kids of all ages. Adults. Movie lovers. Pig lovers. Dog lovers. Cat lovers. Orangutan lovers. Once again, Babe proves that "a kind and steady heart can heal a sorry world." What better message for the holiday season?

As for director George Miller? That'll do, George. That'll do.

Babe: Pig in the City

Rating: ****

George Miller's follow-up to his beloved movie, which was nominated for a Best Picture Oscar. Starring James Cromwell and Mickey Rooney. Directed by Miller.

Rated G, playing in area theaters.

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