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CNN LARRY KING LIVE

Bush Battles Democrats Over Iraq War Funding; Hostage Crisis Close to Resolution?

Aired April 3, 2007 - 21:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(BEGIN VIDEOTAPE)
LOU DOBBS, CNN ANCHOR (voice-over): Tonight, the fight over funding the war in Iraq is heating up, as the president blasts the Democratic Congress.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: They need to send me this unacceptable bill as quickly as possible when they come back. I will veto it.

DOBBS: Will this affect our troops in the field?

Meanwhile, House Speaker Nancy Pelosi defies the White House and goes to Syria, a nation America accuses of sponsoring terrorism.

And the next day or so is critical for those 15 British sailors and marines captured by Iran. So says British Prime Minister Tony Blair.

From Washington, Baghdad, Damascus, and London, the latest on these stories the whole world is watching -- next on LARRY KING LIVE.

(END VIDEOTAPE)

DOBBS: I'm Lou Dobbs, sitting in for Larry King.

And joining us now to examine what are the complex geopolitical realities of the war in Iraq and American interactions with the entire Islamic world, particularly the Middle East, as well as the White House vs. congressional clash over the conduct of war, from Boston, David Gergen tonight. He served as adviser to four American presidents. He's now a professor of public service at Harvard's JFK School of Government, editor at large for "U.S. News & World Report." From Washington, Democratic strategist and CNN political contributor James Carville, and Republican strategist Michelle Laxalt.

Location may prove to be the only thing they have in come this evening on these issues that we are all grappling with in this country.

And we are going to turn now three of the most important correspondents here at CNN in this -- in coverage of this incredibly important and complex story, Ed Henry at the White House, and Michael Ware from Baghdad tonight, and, of course, Barbara Starr from the Pentagon.

Ed Henry, I am going to go to you first, if I may.

The president had a direct threat against the Democratic leadership on the conduct of this war and funding for it. Give us your take.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, both sides dug in deeper today, Lou. We heard a lot more talk, but no real action from either side.

You're right. The president basically raised the stakes by charging that, if the Democrats continue to essentially stop the funding for the war and getting money to the troops out in the field in Iraq, the president charged that Americans would have to wait longer for their loved ones to come back from Iraq.

Well, that is pretty interesting, because this is coming from the president who has kept troops in Iraq, more than 140,000, sending more there now. Meanwhile, you have the Senate Democratic leader, Harry Reid, firing back almost immediately from Nevada, and saying, look, the president is a president, not a king, and -- and said that it's now time to cut off all funding for the war, saying, dramatically, that he doesn't want another drop of blood spilled for this war.

Well, that's interesting, because that's the opposite of what Harry Reid said after the election. He vowed he would not cut off funding for the war.

The bottom line is, the president stopped short today of calling for Congress to end its spring break and come back. And that may have to do with the fact that the president himself is going on a small spring break. He's going to his Texas ranch this weekend for Easter.

And, so, both sides are throwing these words around, and saying, look, this is urgent. We have to do this right away, get the money to the troops. But they are both basically going on vacation -- Lou.

DOBBS: They are going on vacation, and the Democratic leadership also making it clear, as strong as their words are, that the troops would not lose anything in the way of funding for the -- the necessities in carrying out the administration's policies and war fighting in Iraq.

HENRY: That's right.

Harry Reid was very direct today in charging that the president is misleading the country again, in his estimation. He said the president misled the country at the beginning of this war to get into it. And Harry Reid charged that he's now misleading about money running out that the Pentagon needs, is about to run out of money, and borrowing money from other accounts.

The bottom line is, Harry Reid said, they have money that will last through July -- Lou.

DOBBS: Ed, thank you very much.

Let's go to Michael Ware now in Baghdad, where it's about 5:00 in the morning.

Michael, first, thank you for staying up with us here.

And, secondly, how is this raw political battle over the conduct of the war there playing out amongst our troops and with the Iraqi government itself?

MICHAEL WARE, CNN CORRESPONDENT: Well, in the immediate term, Lou, obviously, everyone's focus is on what's happening in the street directly in front of them, right now.

That can even be argued from, not just the troops who are on those streets, but even for the American commander of this war, General David Petraeus. I mean, his focus right now is nothing but securing this capital, Baghdad. He's not looking anymore than five or six months ahead right now. He needs to make this work, funding or no funding. No matter what the political, artificial debate back in D.C. is, he needs to keep his eye on this job.

However, the insurgents, al Qaeda and Iran, they would, too, certainly be keeping an eye on the machinations back there in D.C., again, not because it's going to play immediately into -- in tactical terms, or even in strategic terms. But it does reflect the broader strategic malaise that America finds itself in right now.

America, strategically, is not on one path. There is not even a clear strategy for people to cling to, and to know that's what will carry them forward. And that's how U.S. enemies will use this upheaval. It's on the strategic level -- Lou.

DOBBS: And, Michael, of course, the Democratic leadership in Congress insists that the reason for this battle, this showdown, this contest with the White House is to serve notice on the Maliki government that it must get its government in order, must be effective in moving its troops and security forces and police into the streets of Baghdad and around the country, and taking control of security for itself.

Is it having, as best you can judge it, from those you speak with, both publicly and privately, that effect among the government officials you speak with?

WARE: Look, if -- if Democratic members of Congress believe that their -- their grandstanding over funding cuts and timelines and so forth is in any way putting real pressure on Prime Minister Nouri al- Maliki on a day-to-day basis, I'm afraid that they are most likely deluding themselves.

Prime Minister Maliki already knows he has got his last throw of the dice. President Bush has already made that clear. And, when you have a U.S. four-star here on the ground, in your face, not to mention such senior U.S. ambassadors as Zalmay Khalilzad, or now Ambassador Crocker, I mean, that's where you know the pressure applies, where they are telling you: Buddy, this is it. You make it work, or you're gone. It's been made very clear to Prime Minister al-Maliki, well before this congressional back-and-forth, that he was on borrowed time, and that America will be looking to different alternatives, if he cannot deliver. And, quite frankly, there's not a lot to suggest that he can.

DOBBS: Now from the -- the broader strategic and tactical implications for us, let's go to that which matters most to nearly every America, I would certainly assume. And that is the morale of our troops, as this is being played out before them, this contest over the conduct of the war.

Again, as best you can judge it, the effect, if any, on the morale of our troops there.

Michael, can you hear me?

WARE: Yes, I'm sorry, Lou. There was -- no, there was something in my ear.

(CROSSTALK)

WARE: In terms of troop morale?

DOBBS: Yes.

WARE: Yes. I believe your question related to troop morale.

In that regard, I mean, OK, sure, these kids sweating it out in these streets, these kids driving these Humvees that have just been torn apart by hidden roadside bombs, and these poor Marines out in the western deserts, who, right now, as you're sitting where you are, and here I am, at 5:00 a.m. in Baghdad, at this instant, are behind sandbags on the end of machine guns, waiting for potential al Qaeda attacks.

Now, they would be aware, in the general background noise, of what is happening politically. But, day to day, they are fighting for the mate next to them, for their brother in arms. For them, in, as -- in this war, as in all wars, that's what it boils down to.

So, will it be a kick in the guts? Absolutely. But these kids will still tough it out, because they are doing it for the guy beside them.

DOBBS: Michael, thank you.

Let's -- let's go to Barbara Starr at the Pentagon.

And, obviously, the chairman of the Joint Chiefs caught up in this, Barbara, saying that supplemental funding could have an effect as early as later this spring. What -- what is happening within the Pentagon? And are their preparations genuine for a cutoff in funding? Do they really believe it will have a material effect?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Lou, what's on the table, the military says, is the need for about $100 billion in supplemental funding. And they say they need it this month, or they have to make cuts.

Now, what happened today here inside the Pentagon, it all got ratcheted up one step further. CNN actually obtained a copy of an internal Army memo telling commanders to get ready, that they did not expect there would be an agreement between Congress and the White House, and that they would have to start getting ready for some of these cuts.

How will it start, if it starts? It's going to start with the so-called nonessentials, things like, you know, meetings with contractors, meetings here in the Pentagon, paperwork kinds of things. But, then, Lou, very rapidly, if this goes on, it will, in fact, get down to postponing repair of equipment, postponing training for troops going over there. So, whether it's politics or practical math, people are getting ready for it.

DOBBS: Barbara, thank you very much -- Barbara Starr from the Pentagon.

We will continue here in just one moment. We will be right back. Stay with us.

(COMMERCIAL BREAK)

DOBBS: We're joined now by Fouad Ajami, professor at John Hopkins University, one of the country's leading experts on the Middle East.

Great to have you with us.

(CROSSTALK)

DOBBS: And also Vali Nasr, a professor at the Naval War College and also one of the country's leading experts on the Middle East.

We thank you both for being here, joining, of course, Michelle Laxalt, James Carville in Washington, and, from Boston, the Cambridge eminence, as I said to him...

(LAUGHTER)

DOBBS: ... David Gergen, adviser to four president, editor at large for "U.S. News & World Report."

Good to have you all here.

Let me start with you, Professor Nasr. This war is now is being not only fought out in Iraq and environs, but also, obviously, on Capitol Hill to 1600 Pennsylvania. Are you, at this stage -- and we have talked over the years -- are you more hopeful to a rational outcome to American involvement in Iraq, or are you less so?

VALI NASR, ADJUNCT SENIOR FELLOW FOR MIDDLE EASTERN STUDIES, COUNCIL ON FOREIGN RELATIONS: Well, I think there is clearly this -- the new security plan has made certain gains on the ground. At least the sectarian -- quote, unquote -- "civil war" has stopped, although not the insurgency.

But the problem is that there is no credible, serious political program. Ultimately, we are having a problem in Iraq because there is no agreement between the communities about how to share power. And there is no one forthcoming either. So, I'm not hopeful in the sense...

DOBBS: When you say the communities, you're talking about the Shia, the Sunni?

NASR: And potentially the Kurds as well.

DOBBS: Right.

NASR: In other words, there's no constitutional agreement. They are not talking to one another. So, we can do all we want, in terms of trying to lower the level of violence.

DOBBS: Right.

NASR: But we are only dealing with the symptoms, not with the problem.

DOBBS: Why is there no political initiative amongst those communities, as you describe them, at least as far as you understand it, with this State Department, with this administration?

NASR: Well, the communities that are fighting aren't -- cannot help themselves. In other words, this has never been, in any other similar war, that people who are in the middle of the fight can actually solve the problems.

(CROSSTALK)

DOBBS: But what can the administration do, and why has it not done that?

NASR: Well, we needed to have a similar political, diplomatic surge to go along with the military surge.

DOBBS: Fouad Ajami, you have just returned from Iraq. Do you concur with Vali? Do you see it the same way?

FOUAD AJAMI, PROFESSOR OF MIDDLE EASTERN STUDIES, JOHNS HOPKINS UNIVERSITY: No.

Actually, you know, we have talked about this before many times.

DOBBS: Sure.

AJAMI: And I remain reasonably optimistic.

Remember, Lou, in many ways, America is ambivalent about the very work it did in Iraq. DOBBS: Right.

AJAMI: We went to Iraq in 2003. We midwife a Shia republic, in many ways, in all but name. We are ambivalent about the very work we have done.

We haven't really understood Iraq very well. And I think now we are getting around to this kind of understanding. We understand the stakes. We have been on the ground. This is the beginning of year five. We fight not so much to win, but we fight not to lose.

We fight because we're fighting under Arab and Iranian eyes. The stakes in Iraq are about Iraq, but they are also about our position in the Persian Gulf and the Islamic world as a whole. This is really where we are today.

DOBBS: A simple question for you both. And we are going to have some time throughout this hour to discuss these issues.

But are you satisfied with the level, the diplomatic initiatives taken by this administration, not only within Iraq, with the communities, as you say, Professor Nasr, but also with the surrounding states, who have an immense vested interest, whether they be Sunni or Shia predominantly.

(CROSSTALK)

AJAMI: Lou, it's not easy, because, in fact, the neighborhood is investing in our -- invested in our failure. If you take a look at the countries around Iraq, they want to see us fail. They really want to see us fail.

They are not interested in any success. Iran doesn't want to -- us to see -- to see us succeed in Iraq. Syria doesn't want to see a successful Iraq. The Sunni Arab governments, they look at Iraq, and they say, hey, this is Iraq that used to be ruled by the Sunni Arabs. It has now been taken away from them. And they wish also to see the failure the American project in Iraq.

We are swimming against the currents of the region. This is a very deadly region. It wishes us ill. And our work in Iraq is very complicated because of this.

DOBBS: David Gergen, complicated work, bloody work, deadly, deadly work.

Could you have imagined that this war in Iraq, begun over four years ago, would lead to this state, both in terms of the standing of this president, his administration, a Congress embroiled in a direct confrontation over the conduct of the war, and the chaos that is Iraq? What -- what is your reaction?

DAVID GERGEN, FORMER PRESIDENTIAL ADVISER: I must say, Lou, it was unimaginable four years ago, when we started down this track, we would find ourselves here now. There were many, of course, who said that it would not work militarily. But what I had not assumed was that we would not only have the kind of resistance that Fouad Ajami just talked about within the region, but, just as importantly, the -- the way the political system here has failed to meet this challenge, not only by, I think, our diplomatic offensive.

Our capacity of -- of our State Department is not what it should be. Capacity of the NSC is not what it should be. And now we have this almost childish macho posturing...

DOBBS: Yes.

GERGEN: ... on both sides of Pennsylvania Avenue, in ways that I think that anybody who went through the Second World War or the Korean War, remembers how Americans have traditionally responded politically when troops are on the line, have their lives on the line, just has to be just sort of dismayed by what we are now seeing in Washington.

This is -- you know, it's one thing. I -- it's understandable that these parties have -- you know, the president and the Congress -- and the Democrats have differences. Understandable that the president is going to veto the bill.

What is not understandable is they're hardening in their positions against each other, so it looks we're going to have a donnybrook when the veto is over. And we don't know whether the troops are going to be left with the right armor, or whether they're going to have the proper training.

That is not -- that...

DOBBS: Right.

GERGEN: ... is not fair to the troops.

DOBBS: We are going to be back to discuss that very issue with Michelle Laxalt, a Republican strategist, and James Carville, Democratic strategist.

And we will continue with Fouad Ajami and Vali Nasr here through the hour.

We will be right back, as we continue to examine Iraq and what it has become to the United States and to the Middle East.

Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BUSH: Democrat leaders in Congress seem more interested in fighting political battles in Washington than providing our troops what they need to fight the battles in Iraq. If Democrat leaders in Congress are bent on making a political statement, then they need to send me this unacceptable bill as quickly as possible when they come back. I will veto it, and then Congress can get down to the business of funding our troops without strings and without delay.

(END VIDEO CLIP)

DOBBS: President Bush setting this challenge straightforward.

Let's go to Michelle Laxalt in Washington, Republican strategist.

Michelle, the president shows no signs of trying to reach across a partisan divide and to reach any sort of amicable relationship with the Democrats on this policy. Why not?

MICHELLE LAXALT, REPUBLICAN STRATEGIST: Well, first, I'm curious as to what the Democrats' policy is. I have heard three different policy objectives articulated by the leadership just today.

The fact is that the president has been very clear and very consistent about two things. He will veto a bill which has a timetable attached and which has a date certain for withdrawal and cuts off money. And, so, I don't think, in fairness, it's a matter of his not extending his hand.

I spoke with my son earlier today. And he is one of those boys in Baghdad. And it is a small comfort to hear leadership from the Democratic Party saying: That's all right. We can choke them off. They can survive six months.

Well, heck, even in Nevada, the Mormons get two years of goods in their basements. I would like my son to have a little bit more than six months. They have known this timeline for months and months and months on end.

DOBBS: James Carville, has the Democratic leadership overstepped itself in Congress?

JAMES CARVILLE, CNN POLITICAL ANALYST: Well, we will find out. I hardly think so.

The president has lost public support for this war. It's a little hard for me. I almost want to jump out of my chair. Here is the president that -- that dissed the chief of staff of the Army when he said we would need 400,000 people or so to do this, sent them over there with what troops call hillbilly armor. They came back to a horrendous thing at Walter Reed. I mean, I don't see how you can be sort of pro-troops.

This war is into its fifth year. The cost is probably approaching somewhere of $600 billion and $700 billion. And this president is irritated that Congress is starting to ask questions.

Well, welcome to America. When we have a war that has been conducted on a level as incompetence as this, people are going to have questions. And they continue to have questions. So, stand by, Mr. President. They are coming fast.

DOBBS: Michelle, do you think the president is going to stand by? Is he, at this point, receptive to a public that, in poll after poll, following the results of November 7, have made it clear that they are looking for new directions, not only domestically, but also internationally, and specifically in Iraq?

LAXALT: I think, when it comes to Iraq, this president is one who is not one who points his finger in the wind. And the polls certainly indicate that.

But there can be only one commander in chief. And it is only a few weeks ago that General Petraeus was given a virtual unanimous vote in the Congress for his confirmation. Within hours of his confirmation, they were cutting the legs out from under him and articulating and submitting about 400 different policies for solving the problems in Iraq.

The bottom line is that General Petraeus is on the ground. I can speak from personal experience of a telephone call earlier today from my son, who is there on the ground.

And, with all due respect, yes, the voters have spoken. Who wants to be there? No one wants to be there. We all want to get out. But the cost of failure is far too high. And our soldiers are now having positive morale with General Petraeus on the ground.

DOBBS: Jim Carville, let me ask you the same question I asked Michelle. Why are the Democrat not approaching on a more amicable basis the larger issue of cooperation and bipartisanship that has been nonexistent, actually, in Washington for some time?

(CROSSTALK)

CARVILLE: I guess that would be the question you would have to ask the president, after his press conference.

The Democrats ran and said, we needed a change of direction in Iraq. All this president did is pile on more of the same.

DOBBS: Right.

CARVILLE: I think that we're having an enormous debate in this country, which we should, over a question of enormous political importance, and that is a war that is into its fifth year and over $500 billion in spending.

And that is going to happen in a democracy. Now, he may not like it, and other people may not like it, but the country demands this. The president has lost support in this war. A majority of the American people oppose this war. He has lost allies of this war. He has conducted this war with unbelievable competence. And people have questions, and they want answers. And the Democrats are asking them. And thank God for that.

LAXALT: Well, let's see if they cut off their money, James. The bottom line is that the Congress do have their place in this. And their place is that they can sever all funding to our troops in Iraq. And that is exactly what we're being told they're heading to do. And that, for many of us, is purely unacceptable.

CARVILLE: Well...

DOBBS: When we -- when we continue, we are going to be examining that very question.

It's one of the parts of this debate, the elements of the policy process that has not been explored by the Democrats or the Republicans, at least in public political debate. And that is, what are the range of options that are open to the United States in the Middle East, and specifically in Iraq? And what are the consequences of following any one of those policy choices?

We will continue in just one moment. Please stay with us.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: He's going to have to deal with Congress. And this Congress has been saying we need to change direction in the war in Iraq. It is not going well.

I do not believe there should be a single drop of American blood, additional blood, shed in Iraq. We are not going to allow the president to continue the failed policy in Iraq. We represent the American people's view on this failed war.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

DOBBS: We are going to go now to London where our Matthew Chance is standing by and where British Prime Minister Tony Blair has told the world that he thinks that the next day or two, the next 48 hours, will be critical in winning the release of those 15 British sailors and Marines from the Iranians.

Matthew, what is the latest?

MATTHEW CHANCE, CNN CORRESPONDENT: Well, as you say, Tony Blair is saying that the next 48 hours, the next two days, could be critical in establishing what will happen to these 15 British sailors and Marines that have been held captive in Iran since March the 23rd now.

It's not so much a deadline is set but certainly they are giving the Iranian contacts that they've been having throughout the course of this crisis, the diplomatic contacts, some chance to produce some kind of results.

There's been a statement issued this evening from Number 10 Downing Street, the prime minister in a statement saying that he believes that both sides want this to be resolved through talks to each other and have that they've actually had direct contacts with top Iranian security officials to propose these talks and they're now waiting for a response to that.

There have been these diplomatic contacts that have been going on throughout this crisis. The hope is now that they can yield some results in the days ahead, Lou.

DOBBS: How much political pressure and how much public pressure is there on the prime minister to do something at this point? Fifteen British citizens in uniform held by Iranians, all of whom, at least according to the Iranians, have signed confessions and admitted they were in Iranian waters illegally and yet showing with some considerable erratic language that it's far from clear what their intentions are with these hostages.

CHANCE: I certainly think that Tony Blair understands that if some kind of diplomatic solution to this isn't achieved very soon, the public pressure on him is going to be increasing.

But the fact is we have been seeing these images broadcast all over our television screens of these individuals. They're looking quite relaxed. They don't look like they're under a particular amount of physical pressure at least. Although clearly the emotional pressure on them must be very intense indeed because they are saying these things, making these confessions, which basically everybody here believes are in some way coerced. And of course, we don't know what the actual circumstances of them are.

Tony Blair has given this a 48-hour period. After that he says if there's not any firm progress on getting a release for these sailors and Marines, then he'll have to step up the measures against Iran. He hasn't specified how did he will do that, but certainly I think that if we don't get an early release for these British service personnel, pressure on the prime minister will increase for him to do more.

DOBBS: Matthew, thank you very much. Matthew Chance in London.

Turning now to Beirut, to Damascus, rather. I'm so used to talking to Brent Sadler in Beirut. In Damascus, our Brent Sandler who is there to cover the speaker of the house, Nancy Pelosi, who is to meet with President Assad in a matter of hours now.

Brent, bring us up to date.

BRENT SADLER, CNN CORRESPONDENT: Yes, Lou, Speaker Nancy Pelosi arrived at the (inaudible) Airport here in Damascus. She was met by the foreign minister, Walid Muallem. The first video pictures that came out of Damascus was that meeting by the foreign minister at the airport.

And pretty soon after that, the political heat was intensifying in Washington. President George W. Bush accusing the Pelosi delegation made up of high-ranking officials led by Pelosi, effectively sending mixed signals to the Syrian leadership and to the Middle East region at large. It really did undermine, according to President Bush, his efforts to isolate Syria. She'll be meeting with the Syrian president, Bashar al-Assad, both for formal meetings and a lunch that will include both Assad and other top members of the Syrian leadership.

After the arrival at the airport, Pelosi went to one of the ancient parts of Damascus. And she went on a walkabout around the city's center and mingling with ordinary Syrians. There was no hostility towards her whatsoever. She looked very relaxed inside the capital as she spoke to the Syrians.

At the same time, the Syrian press today said in their headlines of "The Syrian Times" that Pelosi was -- quote -- "a brave lady" for making this trip to the Damascus and that the mission could be invaluable. Those are the counter reactions from the Syrians so far -- Lou.

DOBBS: Brent, thank you very much.

And for her part, the speaker saying she has no illusions about what was accomplished there but she is, as she put, "hopeful."

Brent Sadler reporting from Damascus and of course, he will be keeping us up-to-date throughout the speaker's visit to Damascus.

And we will continue with our panel of Vali Nasr and Fouad Ajami, two of the country's foremost experts on Middle East, David Gergen, who is at the Harvard School for Government and who advised four presidents; and of course, James Carville, Democratic strategist Michelle Laxalt, Republican strategist as we take a look at what will be the consequences of the policy choices that now face the United States government. That includes, of course, the White House and the Congress. Stay with us.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D), HOUSE SPEAKER: For Syria and Iraq, the goal of Syria supporting Hamas and Hezbollah, the goal of Syria in so many respects that we think there could be a vast improvement. So therefore, we think it's a good idea to establish the facts, to hopefully build some confidence between us. We have no illusions but we have great hope.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

DOBBS: Let's go now to David Gergen at the Kennedy School of Government at Harvard in Cambridge.

David, part of your career has been to extricate presidents, to protect presidents from themselves, if you will. You've heard from our reporters. You have heard from Fouad Ajami and Vali Nasr, the politics, as expressed by Michelle Laxalt and of course, James Carville.

It does not sound like we're going to see bipartisanship. It doesn't look as though we're going to see an elevation of a concept called statesmanship. What would you recommend to this president right now for the good of the country, for the national interests, and our interests in the region, the Middle East?

GERGEN: Well, that's a very, very good question, Lou. And for the good of the country, I believe the president needs to put down his sword, just as Harry Reid and the Democrats do up there on Capitol Hill. OK, I have this veto of this bill, that's understandable.

But I think I would recommend three things. First of all, the president needs to form, as he talked earlier this year, some sort of council which brings together his own administration with the leading Democrats and Republicans on the Hill to see if we can't form late some long-term strategy for the United States that people can agree on and that our troops can rely on on the ground.

Secondly, it does seem to me, Lou, after this veto, it is possible to reach a compromise of some sort, narrow our differences. In effect, I think the Democrats ought to give the president six months to see if this surge is going to work. They're not going to totally pull the plug on the troop there. They're not going to stop the surge. So go ahead and give him the six months but in exchange for that, he ought to promise them that if this isn't working in six months, if we don't see definitive time signs, both politically and militarily, this is working, then he's going to move toward a pull- back.

And thirdly, I would argue that he needs to pull in the heavyweights across American who have been involved in diplomacy, starting with James Baker, but including the George Schultz, and including Madeleine Albright, and others to get a diplomatic offensive under way that's serious.

This State Department, this NSC, do not have the muscle to carry out a diplomatic offensive.

DOBBS: What I just heard you say is that you do not have a great deal of confidence in Stephen Hadley or you go not have a great deal of confidence in Secretary of State Condoleezza Rice. Am I hearing you correctly?

GERGEN: Well, I think they're fine people. I have a lot of respect for both of them as individuals, but look at the results. What have we seen? Can anybody say that these are the heavyweights that we want to see in American foreign policy pulling out? I just don't think it's there right now. And I think that there are other people out there who have the experience who would be willing to come to the aid of the country.

DOBBS: Michelle, James, you just heard David suggest an elevation of both motivation, rhetoric and intellect, as applied to the conundrum that is Iraq and the Middle East now. Is it possible in partisan, political terms, Michelle?

LAXALT: I think the American people have an opportunity right now when their members of Congress are home listening to them to remind them once again that they vote every November for president and for Congress. The only institution that has a lower approval rating right now with the American people is the Congress.

And, therefore, the American people, you have the opportunity to tell your member to knock it off in mom terms and get your acts together, and remember we are united and put away the partisan swords. I agree with Mr. Gergen on that very point. Yes, they can come to an agreement on at least giving the surge an opportunity.

DOBBS: James, that's one form, I suppose, of bipartisan mending and melding. What would be your response?

CARVILLE: Well, my response would be this: we had that. We had the 9/11 Commission. You couldn't have had Jim Baker. You couldn't have had any more heavyweights on that panel of the 9/11 Commission. There were five Republicans and five Democrats.

DOBBS: James, I'm sorry but something has happened to your audio. We'd like to get that back as quickly as possible.

I want to turn now to Fouad Ajami and Vali Nasr.

The debate over the conduct of this war has not been in Washington, D.C. at least about what the United States should do, what are the possibilities and what are the range of options open to us. I'm talking now specifically vis-a-vis Iraq. Nor has there been a public discussion of what will happen should the Democratic initiatives passed by this democratically led Congress in conference, if they were to succeed in getting this bill through, what that timeline should be, what would be the result of a withdrawal of 150,000 U.S. troops or the preponderance of those troops, what would it be in Iraq, what would be the consequences, what would be the impact in the Middle East?

I will start with you first.

NASR: Regardless of whether one agrees with why the war happened, how is it managed, it's very clear that Iraq is now social instability in the region. It doesn't have a standing government. It doesn't have a viable state.

DOBBS: Right.

NASR: It doesn't have viable security. And so long as it doesn't have those things, if the United States were to leave precipitously, without a doubt Iraq would become a source of far greater...

DOBBS: Do you consider precipitous -- would that include the definition of pulling out by March 31?

NASR: I don't think it's a matter of a date. It's a matter of what replaces the United States. If tomorrow morning there is not an Iraqi guilty, an Iraqi government can be responsible for that territory, we can leave tomorrow morning. If it's not within two years, we're going to face the problem in two years time. DOBBS: We're going to be back. We're going to hear Fouad Ajami's view on the same issues and the panels.

We're going to be back here in just a moment. Fouad Ajami recently returned from Iraq. He'll give us his views on the policy choices that are available to the United States government and what the likely consequences of choosing one of those policy directions would be. We'll continue with our panel here as LARRY KING LIVE continues.

(COMMERCIAL BREAK)

DOBBS: Welcome back, Fouad Ajami, Professor Nasr said basically the United States has to get the job done, that that really is the only policy choice we have. What policy choices do you see available to us and what would be the consequences if selecting any one of those choices?

AJAMI: We have a policy choice, which is we have to get General Petraeus and we have to do the surge and we have to give the Maliki government this one last chance. The old policy of both General Casey and General Abizaid favored the light footprint. The new policy is about getting our soldiers right into the streets of Baghdad and right into the life of Iraq.

We're getting more intelligence. There is more optimism in Baghdad both among the Iraqi leaders I talked to and among the commanders and colonels and officers of General Petraeus. We have to give the policy this run. The run, I think, is five to six months ahead and that's the only choice we have. We really don't have any other choices. It's not pretty. It's not brilliant but this is the one choice we have open to us.

DOBBS: James Carville, two of the country's leading experts say that there really isn't much choice. We've got to get it done. How much of a political risk do the Democrats run, in your judgment? And should we worry about a political risk here for the Democrats or for the Republicans, either one? Is it really a matter of the natural interest and representing the national will?

CARVILLE: Well, I mean there's always a political risk in everything. In politics, there's nothing that doesn't come without risk.

I think the real political risk is to stay with the strategy that has deduced nothing but failure. We're in the fifth year of war. We spent over $500 billion.

But I want to allude to something, and you picked up on this, that David Gergen said, who's a very experienced hand, and it's quite ordinary that our State Department and our NSA are basically incompetent to conduct the kind of foreign policy that we need. And this is kind of startling.

I mean just sitting here, and David, you're an experienced hand, and that's a pretty serious thing. DOBBS: James, let me do this; let me ask two foreign policy experts. I want to know and I know this audience wants to know, what do two experts in the field, two professionals think about the quality and the talent of our National Security Council and our secretary of state and Department of State, Vali Nasr?

NASR: Well, there is -- aside from whether they're good or bad, I don't there's sufficient amount of effort being put into producing a diplomatic, political initiative, and that I think is a very clear failure. We're sending General Petraeus with a mission, which is making gains with...

DOBBS: You don't have a high regard for Secretary of State Rice or her department at this point?

NASR: No, I don't have a high regard for the way they're handling Iraq. They are very competent and very good people, but what we're seeing is that there is no political diplomatic initiative.

DOBBS: Fouad Ajami?

AJAMI: I like the term that Churchill once used about the Middle East when he described it as "those thankless deserts." These are very difficult lands, Lou. These are very difficult countries. And we don't have the language skills, we don't have the culture skills, we don't have the experience...

DOBBS: You're a kind, gentle and elegant professor.

AJAMI: I try...

DOBBS: But I want to say to you...

AJAMI: Yes?

DOBBS: All of us who something that is hard, we're expected to do it when we take the job. Do you have confidence in Secretary Rice, her department and the National Security Council?

AJAMI: Well, what's interesting about Secretary Rice and her department in terms of Iraq, they're no longer doing the Iraq. Secretary Rice has now abandoned Iraq to do the Israeli conflict. It's a very, very difficult assignment. We've drawn a very difficult assignment in a very difficult country.

DOBBS: You're a great grader of Condoleezza Rice, the secretary of state.

AJAMI: I'm an easy grader. My students always say I'm one of the easiest graders in school.

DOBBS: I don't think we're going to get a...

NASR: But I think that his point is actually the essence of it. We're putting more effort into the Arab-Israeli relations than we're putting into solving Iraq at the diplomatic level. DOBBS: I think in a way you both answered the answer.

And we're going to be back. I'm going to see how James Carville, David Gergen as we conduct in a follow-on, if you will, to his observation. We'll be back with Michelle Laxalt, James Carville, David Gergen, Fouad Ajami and Vali Nasr in just one moment. Stay with us, we're coming right back.

(COMMERCIAL BREAK)

DOBBS: Well, James Carville, you picked up on David Gergen's assertion about the level of confidence at stake and the National Security Council when it comes to the Middle East. You heard two terrific professors on the subject comment. What's your reaction?

CARVILLE: Well, my reaction is that I think the professors -- what everybody knows. I mean Donald Trump said it right here on Wolf Blitzer's show, that she looks good and she dresses good and she talks nice and she sits at a 45-degree angle, but we never get a deal.

And I mean David, to his credit, points out that well, maybe we need to bring some other people in it. Well, we're in the seventh year of this administration. We see the attorney general is incompetent. Now we see the secretary of state is incompetent. I mean is, you know, George Will pointed out -- Casey Stengel once said, "Can anybody here play this game?" I mean is there anybody in this government that can do anything?

DOBBS: Michelle Laxalt, give us the lineup that you can defend.

LAXALT: I think the bottom line is that there is such a thing as a lame duck. But when it comes to foreign policy and our troops on the ground, we have to be united as a nation whether or not we disagree or agree with different members of the cabinet. Let's remember that we are there because we were attacked on our shores. Three thousand of our innocent citizens were whacked, taken out with malice of forethought. So this wasn't just a cowboy routine. We're there. Nobody is happy we're there, but we need to remain united and support one another.

DOBBS: David Gergen, your thoughts?

GERGEN: Listen, President Bush deserves credit for appointing Bob Gates of defense and General Petraeus, two terrific appointments.

DOBBS: Right.

GERGEN: But I want to go back to this, Lou, this is a difficult job to stay. Fouad is right. We're in a tough situation.

But you know this is the administration that got us into this war. They owe it to us to get the best darn people in the country to help get us out of this thing in a good way. And to sort of go on with business as usual when the diplomacy is not working, it seems to me wrong-headed. And I just think we need -- I think if I look back upon the great secretaries of state in recent years like Henry Kissinger and George Shultz and Jim Baker, you just don't see that kind of strength at the State Department and the NSC that you saw when they were there.

DOBBS: I think these two professors -- I'm going to say it this way, Professor Nasr and Professor Ajami would agree with you if not overtly.

This administration rejected one of those luminaries' names, that's Jim Baker of Baker-Hamilton, the Iraq study group.

We have about 30 seconds. Do you believe that there are Arab states in the region that will come together to support us at all in resolving this issue, Professor Nasr?

NASR: I don't think so. I think they would like to turn our foreign policy in the direction they want but they will not.

DOBBS: Professor Ajami?

AJAMI: None of these countries would like to see us succeed.

DOBBS: All right, Fouad Ajami, Vali Nasr, James Carville, Michelle Laxalt, David Gergen, we thank you.

And we thank Larry King for letting me have the opportunity to sit in for the great man. We thank you for joining us here tonight.

I'm Lou Dobbs, good night from New York.

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