That would make sense. I was looking around, and couldn't find the original article to see in what context it was taken. What I did find was some presumably leftwing site called Unknown News that had a link to the posted article and a link to the New Yorker site but not to the original New Yorker article (actually a press release). I did some searching but was unable to come up with the original. Here is the link to the Unknown News site.
http://www.unknownnews.net/insanity011404.html Anyways the above site asks "Is George Bush insane?", because of this "quote". That got me somewhat interested in finding out the real deal. I figure that it was taken out of context like you said deliberately.