Amb. Zalmay Khalilzad, Roundtable

BRIT HUME, HOST: Despite intense diplomatic pressure, interim leaders in Iraq have not been able to agree on a government in the four months since the elections were held. So what's the next move for the United States?

For answers, we turn to the U.S. Ambassador, Zalmay Khalilzad, who joins us from Baghdad.

Mr. Ambassador, welcome. Good morning. Let me ask you, first of all, about reports that are out this morning that concern a document, a study that is said to have been done by the U.S. embassy in concert with the military, to assess the overall situation in Iraq.

And the study is said to have concluded that the situation is very serious in terms of stability and progress in five provinces of Iraq's 18 provinces and in a crisis situation in a sixth province.

First of all, what about that study? And what is your reaction to its conclusions?

ZALMAY KHALILZAD, U.S. AMBASSADOR TO IRAQ: Well, as you know, the Iraqi constitution delegates a lot of authority to the provinces, and we have decided to assist those provincial governments in terms of building their capacity to deliver on the new responsibilities.

To prepare for that, we commissioned a study as to what is needed in terms of capacity building in the various provinces, and the purpose there is different than your normal military assessment.

When we do assessment on military bases every day, we look at number of attacks. Here, the examination was not only in terms of attacks, but also in terms of institutions, the broader forces at work in terms of stability.

So the goal was what do we need to focus on in terms of different provinces, in terms of the help that they will need. So I think it's a good effort, and we'll put different levels of emphasis in different provinces for helping the provisional governments.

HUME: Why shouldn't an ordinary American reading a report of this say my God, here I'm hearing optimistic projections from the administration that things are improving rapidly in Iraq, and that for all of the violence, things are getting better, now I read that fully a third of the country appears to be either in crisis or, as in the case of the Fila (ph) provinces, in a serious situation?

Why shouldn't people believe that things are deteriorating there based on this document?

KHALILZAD: Well, if they had looked at a similar sort of study a year or two years ago, they would have seen that the situation probably was not as good as now. I wouldn't worry about the question of terminology. I wouldn't focus on it. What I would focus on, that in one province that is substantial, fighting that's going on -- but at the same time...

HUME: And that province, by the way, is which?

KHALILZAD: ... the capacity to -- it's Anbar, which is a western province...

HUME: Right.

KHALILZAD: ... where the insurgency and the terrorism has been there for a while.

The other is although they've described it serious, what they mean is that the ability of the local government to do what the local government ought to do is limited, that this -- when the system or the centralized system -- the local government didn't have to do some of the things that it has to do now. So they will need help.

I think, you know, it's -- we want Iraq to succeed, to stand on its own feet, and the provincial governments -- some of those places do need our help. It's more about the capacity of the local government rather than a description of the situation over all.

HUME: All right. Mr. Ambassador, let's turn to the question of the formation of a government. This has been going on now for four months. What is the likelihood of success and how soon?

KHALILZAD: I want to say two things on that. Point one, of course, the election results did not become known until the 10th of February.

And then since that time, the parties have been working for the first time -- Sunnis, Shia, Kurd parties, are working together to -- and they've agreed on a number of things, the program of the next government, processes for decision-making, as well as institutions of the new government. They have not yet agreed on the composition of that government.

Point two is that we are pressing them very hard. The Iraqis are losing their patience as well as the international community. I think we are some...

(AUDIO GAP)

KHALILZAD: ... but it's important, Brit, to remember that what we want is a good government, not a government as soon as possible. We want a good government as soon as possible.

This is Iraq's chance to...

(AUDIO GAP)

KHALILZAD: ... trajectory. I believe that while we press them, we need to also be patient, because these people have not really compromised and have come together ever before in the history of Iraq.

This is the first time that you're getting a democratic government, authoritatively elected people from different communities, compromising, coming to agreement. So we need to press them but also, in my judgment, we need to be patient to make sure we get the right government.

HUME: Mr. Ambassador, talk to us about interim Prime Minister Jaafari. Can you envision a successful Iraqi government forming with him still in power?

KHALILZAD: Well, there is a question with regard to his ability to be effective and to unify. He has been nominated by the largest bloc, as the constitution calls for, but that bloc doesn't have a majority, and he needs, in effect, a two-third vote of the assembly, so he needs the cooperation of the other factions.

HUME: Can he get it?

KHALILZAD: And they have rejected him so far. Well, we'll have to see. So far, he has not been able to do that. Today, the bloc that nominated him met, and they have sent a delegation out of three people to one last time check with the other blocs to see whether they would accept him.

And if they don't, it's assumed that they would look at other candidates. So we're right in the middle of this. And I think in the next two to three days, this issue is likely to be clarified.

HUME: You mentioned that there's been -- the international community has been pressuring -- I see we have -- I hope you can still hear me. Mr. Ambassador, we're having some technical problems which has caused your image to disappear from time to time. But we're still hearing you, and so we'll cross our fingers and keep going here.

Can you respond to the suggestion that's been heard from some Shiite officials, some Shiite politicians, that the visit of Jack Straw, British foreign secretary, and Secretary Rice to press for the formation of a government was actually a mistake and that it backfired? What is your view of that?

KHALILZAD: Well, I think that was helpful, in my judgment. What it indicated to the people here is that the international community, which has a lot at stake here, is helping Iraq to succeed. The people and those countries are losing patience.

They would like Iraqi leaders to come to a decision, to decide on people who will govern the country, that the vacuum that exists now is actually dangerous. It encourages terrorists to provoke sectarian conflict. I think that was useful for the Iraqi leaders to hear. But I know I'm aware of some of the comments that you refer to.

HUME: How worried are you, as you have suggested, that the sectarian violence in Iraq could spread to the larger Middle East?

KHALILZAD: Well, I think that will only happen, Brit, if we leave Iraq, if we abandon Iraq, as some people have called for in our discussions back home. If we were to abandon Iraq, I think that it is likely that sectarian conflict will increase, and that increase in sectarian violence could bring in countries from the region, Iran and others, to take side, and therefore could expand the conflict.

I do not believe that this will happen if we continue to help Iraqis, if a government of national unity is formed, and our forces are here to help them.

HUME: Mr. Ambassador, one final question. You are the man who is to meet with Iranian officials to discuss their role in Iraq. What do you expect from that meeting and when will such a meeting occur?

KHALILZAD: What we have decided is not to hold the meeting until the Iraqi government is formed. We do not want to give the impression that the United States is sitting with Iran to decide about the Iraqi government. The Iraqis will decide that.

So we have deferred that meeting until after the formation of the Iraqi government.

HUME: All right. Ambassador Khalilzad, thank you very much for joining us this morning. Pleased to have you, sir.

Coming up next, the controversy about the president and the release of some intelligence information. We'll get into the story with our panel, Charles Krauthammer, Mara Liasson, Bill Kristol and Juan Williams. Stay tuned.

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U.S. SENATOR RICHARD DURBIN (D-IL): That is as serious as it gets in this democracy.

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U.S. SENATOR CHARLES SCHUMER (D-NY): There ought to be some rules so that a president can't just do whatever he or she should want willy-nilly.

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U.S. SENATOR HARRY REID (D-NV), MAJORITY LEADER: President Bush's oval office is a place where the buck stops, where the leaks start.

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HUME: Well, there are some key Democrats' views of the news that President Bush authorized the release of some material that had been classified.

For more on all this, we bring in our panel, Fox News contributor syndicated columnist Charles Krauthammer, Mara Liasson of National Public Radio, Bill Kristol of The Weekly Standard, and Juan Williams, also of National Public Radio.

Well, what about this? What we learned this week was that, at least according to Patrick Fitzgerald, the special prosecutor in the Scooter Libby case, is that the president had asked that some information that had been classified from a national intelligence estimate, which is a document compiled for him on a daily basis to give him an idea of what's going on in the world, and is always classified, be made public and be made public at least at first to a reporter for the New York Times and perhaps a couple others.

Now, significant portions of that document were later released to all the press.

MARA LIASSON, NPR: About 10 days later.

HUME: About 10 days later. So, question. What about these allegations? And it wasn't just the Democrats who were calling this a leak. Newspaper headlines in a number of organs -- you see USA Today there, "Bush OK'd Leak", New York Times from Friday, "Cheney Aides Say President Approved Leak".

What about this, Charles? Are we talking about a serious breach here, a leak by the president of classified information?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: This whole story is absurd. Of course it's not a leak. A leak is an unauthorized disclosure. In our system, the authority to disclose rests with the executive. That means the president.

Who do people imagine decides what can be disclosed and what can't, you know, the Supreme Court justice with the most time on his hands? It has to be an executive function.

And in this case, the president had excellent reason to release this information because there had been an accusation by Joe Wilson that the administration had distorted information about Iraq and Niger and uranium, an article had appeared, and that article had some distortions in it which we later discovered a year later in the Senate Intelligence report. So Scooter Libby knows about these distortions. At the time it could not be disclosed, so he needed to release them. And he did.

And the important disclosure was that Wilson had neglected to mention in his article that even though he gave the impression that it was a slam dunk, no connection between Iraq and Niger, in fact, Wilson himself had reported that Iraq had sent a delegation in Niger which had discussed commercial relations, which obviously is about uranium.

That was left out. That had to be disclosed. And it was perfectly legitimate for the president to authorize that.

HUME: Mara?

LIASSON: Yes, I think what we know is that in an effort to boost his side of the case in this raging debate at the time about pre-war intelligence, he decided -- the president decided -- to declassify some previously classified information and release it, whether it was first through Scooter Libby to reporters and then actually pieces of paper, the actual National Intelligence Estimate was released.

I think this is all about the definition of the word "leak". If leak is an unauthorized disclosure, this one was very authorized. I think that there's a tangential story here, and it's about whether or not the -- and who disclosed the identity of Joe Wilson's wife and the fact that she worked for the CIA and was a covert operative.

Nothing in Patrick Fitzgerald's current filing with the court suggests that the president authorized that.

BILL KRISTOL, WEEKLY STANDARD: In fact, we don't know she was a covert operative. And Patrick Fitzgerald won't even claim that. And Patrick Fitzgerald isn't investigating the actual source of the leak of Mrs. Wilson's name, which was a Bob Novak column, and we still don't know who told Robert Novak. Apparently Scooter Libby didn't.

You know, the leak story is absurd. But I now think the whole prosecution is absurd. And I hesitated to say this because I have friends who respect Fitzgerald. But I now think it's a politically motivated attempt to wound the Bush administration.

Why did Fitzgerald release -- I mean, the theory of Fitzgerald's perjury case against Libby, which is the only crime that's alleged here -- perjury and related crimes...

HUME: Obstruction of justice.

KRISTOL: ... and obstruction of justice through perjury, really, for misleading the FBI or the grand jury -- the theory of that case is Libby didn't tell the truth, he didn't say that Cheney had told him to do this because he blamed it on reporters because he wanted to protect the vice president or the president.

Well, now it turns out that Libby, in testifying to the grand jury, carefully explained that he was authorized to go ahead and discuss the National Intelligence Estimate by the vice president.

HUME: But not Valerie Plame necessarily.

KRISTOL: But not Valerie Plame, which was tangential, and which he -- which came up near the end, apparently, of the conversation with Judy Miller. It was never central in those two weeks or three weeks.

It seems to me that Fitzgerald's case is crumbling. He's refusing to close, incidentally, his investigation of Karl Rove and other people. You can read his 39-page rebuttal to Libby. He focuses now on Cheney. He is now out to discredit the Bush administration.

He has bought the argument that there was something improper about the Bush administration responding to Joe Wilson's charges. And that's the real meaning of what's happened in these last few days, which is very dangerous for the Bush administration.

They now have a special prosecutor out to discredit -- not to convict Scooter Libby, but out to discredit the administration.

JUAN WILLIAMS, NPR: I don't know why you would say that. It seems to me that you have a situation where someone is charged with lying, obstructing justice but lying to a grand jury. That's the problem. You don't lie to a grand jury. I mean, that's it.

And as to whether or not he had anything to do with the disclosure of the secret -- the identity, clearly, Mr. Fitzgerald has moved in the other direction, moved away from that.

But let me come back to the real point here, which I think is being spun in a very peculiar way on this panel this morning. It seems to me that you can't deny that the president of the United States was clearly trying to plot how this information would be released to rebut the claim made by Joe Wilson that Iraq was not seeking enriched uranium from Niger.

So rather than being forthcoming and saying, you know, I'm holding a press conference or I'm issuing a statement to tell the American people what I know and that this is important because it's the basis for us as an American people going to war in Iraq, he arranges through Vice President Cheney for Scooter Libby to talk to the New York Times.

And then, you know, this is at a time when there is clear doubt coming from analysts, intelligence analysts at the State Department, from the United Nations, people who say you know what, this is really -- what we know in this intelligence estimate is wrong, and yet none of those doubts are conveyed by Scooter Libby to Judith Miller at the New York Times.

It's put out there as if it's fact. So what you have is the president orchestrating a political attack. And I think that's what's upsetting people, whether or not it's technically a leak or not a leak -- OK, but what you have is the president trying to undermine a critic with a very strong political intention by -- you know, whether you want to call it leak or not -- placing information strategically.

KRISTOL: Shocking, shocking. A White House staffer had breakfast with a New York Times reporter and made the White House's case on an argument.

WILLIAMS: A one-sided case in which he leaks information.

KRISTOL: In which he releases information that was later -- a week later was declassified for everyone and was uncontroversial and which Joe Wilson had misled the country about.

WILLIAMS: A week later it's in a sanitized version given to everybody. Why? Because Judith Miller and the New York Times didn't use it. That's why.

KRAUTHAMMER: Look, this idea that somehow they were discrediting Wilson in this release is nonsense. Discrediting a guy is using a wiretap about some secret affair he's having and blackmailing him over that or releasing that information.

This was a release of information about the substance of what Wilson had said and was a way of saying that Wilson had left out in his New York Times editorial stuff which he had already told CIA and others when he had returned.

He'd never written a report. He'd given an oral report in which he talked about a visit three years earlier of the delegation, and he left it out of his article. It's perfectly legitimate for a government to add in a fact which the guy had left out as a way to distort information.

WILLIAMS: Well, Joe Wilson -- go ahead.

KRAUTHAMMER: That's not discrediting him personally.

LIASSON: You know, all those things -- all those things are part of the debate and the second cycle coverage of the story, but I agree with Bill.

The first cycle coverage of the story was president authorized leaks. Those are what the headlines said. And the Democrats have been making this argument that he is, in effect, a hypocrite because he's spoken out against leaks, and here he is supposedly orchestrating one of his own.

I think that's -- in terms of just the politics of this for these few days, that's what's bad for the White House.

KRISTOL: But what takes it beyond these few days is there is an ongoing prosecutorial investigation which has not been closed. And Fitzgerald has other people in his targets. Otherwise, he would end the investigation of Karl Rove and, for that matter, conceivably Vice President Cheney.

And when you read Fitzgerald's response, the 39-page document he released Wednesday night, which is how we know about Libby's apparently truthful statement to the grand jury, it is clear that Fitzgerald is going after the White House in general. He does not simply want Scooter Libby on a technical and, I think, dubious perjury charge.

WILLIAMS: One last point here, which is that now you have a possibility that Scooter Libby will call Vice President Cheney and President Bush to testify in his defense, which I can't imagine would do anything but stir the hornet's nest and upset the president.

HUME: We're going to take a break here. But coming up, we'll get into that immigration deal that wasn't and which political party stands to lose the most. We'll be right back.

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HUME: On this day in 1959, NASA introduced America's first astronauts. The seven military test pilots were selected to take part in Project Mercury, America's first successful manned space program.

Stay tuned for more from our panel.

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U.S. SENATOR EDWARD KENNEDY (D-MA): I think politics got in front of policy on this issue.

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U.S SENATOR JEFF SESSIONS (R-AL): This bill is a dead horse, in my view. It should be rejected.

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HUME: Well, that was Senator Kennedy, a proponent of the immigration compromise, and Senator Sessions, Republican opponent of the bill, and they're both offering their views about what happened.

What about this? We had a proposal. We discussed it earlier in this program. And it looked like a deal was in place, and then on Friday, it all fell apart.

And Republicans are claiming that the Democrats wouldn't allow them to try to amend it, even if the votes were there to block any amendments, and the Democrats are saying well, the Republicans then wouldn't allow action on their own bill.

What do you say, Juan? What happened here? And who's politically more vulnerable at the moment on this? And what is the likely course forward?

WILLIAMS: Well, going forward, I mean, look at the '06 elections. You'd have well, gosh, this energizes the Republican base. I mean, the people who care most deeply about it, the sort of populist voice, if you will, so far, until we have (inaudible) exactly what the consequences of all this turnout in the streets is -- the populist voice is coming from the right, and I guess it would energize that base, especially in areas of the country like the southwest that are most impacted by illegal immigration.

But I think that you have a very interesting feud going on among the Democrats. The unions are a major player here and the unions are split. Part of the unions want to limit the amount of illegal immigration.

The Hispanic community -- obviously very sympathetic to the idea that illegal immigrants' relatives are -- legal immigrants are hard- working people coming into this country.

They want to allow the maximum amount of people to stay in the country either as guest workers or permanently, and so you have this split among the Democrats, and that leads them, then, to oppose any amendments that could water down a very tightly created compromise.

HUME: Bill?

KRISTOL: The bill was ready to go Thursday night. Chuck Schumer, the senator from New York, the head of the Democratic Senatorial Campaign Committee, told his colleagues he would prefer to have the issue than the bill.

He wants to be able to say the Republican Congress both could not pass legislation in the first place, which hurts if you're in the majority, and it's an issue that people care about.

And secondly, to the degree that either house passed anything, the House of Representatives passed a restrictionist, mean-spirited immigration bill which will be good for the Democrats presumably in some contested races to make the Republicans look anti-immigration.

So it was a pure political calculation by Schumer. He turned Harry Reid around late Thursday night and early Friday morning. And therefore, for now we have deadlock.

I think the Hispanic groups, the pro-immigration groups, will get to the Democrats over the next two weeks and say you know what, we'd like to actually deal with this problem, we have a responsible bipartisan bill that can pass the Senate, that can go to conference and come back in a reasonable form and pass both houses.

I think it's still more likely we will have legislation, but Chuck Schumer is doing his best to try to get Democrats to win the Senate and the House, and he doesn't want legislation.

LIASSON: Yes. I think in the short term, if the Democrats are calculating that this is an issue where Republicans suffer, they have some evidence to show that.

You saw the people who are now rejoicing that the bill has been stalled. It's the opponents. It's the Republican opponents. You showed the clip from Jeff Sessions.

You have Hispanics...

HUME: A sentiment, by the way, not shared at the White House.

LIASSON: Correct, oh, not shared at the White House, not shared by many other Republicans, but by the, quote, anti-immigrant forces in the Republican Party.

HUME: Right.

LIASSON: You have Senator Kennedy saying this was politics. He certainly wants a bill to go forward. Most of the pro-immigration groups, the Hispanic groups, say they want a bill to go forward.

I think that there -- the policies of this could go either way. Of course, the gross politics of it are bad for Republicans if they're seen as the anti-immigrant party.

But on the other hand, it's pretty clear, and I think the sentiment will be expressed tomorrow in those demonstrations, that the majority of Hispanic voters, which is what we're talking about here -- that's what people are fighting over -- want a bill.

They want a good one. They don't want the House version, but they want something to go forward this year.

KRAUTHAMMER: It's the Democrats who killed it and who decided to kill it on Thursday. But I think that their calculation was, A, they didn't want any amendments, because an amendment would require a Democrat to take a stand on probably -- it would have been Republican enforcement measures, and they would lose either way.

Secondly, if no bill emerges out of the Senate, the only existing bill people will talk about is the one out of the House. And the one out of the House has the word "felony" in it. And that's what brought a million people into the streets over the last week and will bring thousands out tomorrow, that word.

And Republicans are stuck with that word, as you saw in your interview with King. Republicans tried to change that, and Democrats left that label, left it in the bill, forced it in, but it will be hung around the necks of a Republican House, turning 10 million people into felons.

And I think it's that that motivated Democrats to decide -- and in the absence of any other legislation that that would be hung around the necks of the Republicans and it would hurt them a lot.

HUME: So is it now fair to say that this issue, which we have all noted has seriously split the Republican Party, has now split the Democrats?

LIASSON: I think there are divisions in the Democratic Party. I don't think they're nearly as deep or profound as on the Republican side. Sure, you have difference between the unions -- SEIU, for instance, the Service Employees, is very much for earned legalization and amnesty. You have some older manufacturing unions who maybe aren't as excited about it. But the leadership of the AFL-CIO, even before it split, decided several years ago that it had completely changed its approach to immigration. They want a bill.

There are some African-Americans who are ambivalent about this. But I would say the divisions, while there, are not as deep as on the Republican side.

KRISTOL: Democrats are playing politics. They're playing it pretty skillfully. And we'll have to see if the Republicans can put pressure back on the Democrats. I mean, this is a classic case where...

HUME: They're getting help from the Democratic base, though, clearly.

KRISTOL: Well, let's see.

WILLIAMS: But let me ask you, what about the Republicans? Why should the Democrats bail out the Republicans who want to water down the bill? Charles says hang this around their necks, the word "felons", "amnesty". That's coming from the Republicans.

KRISTOL: Look. Do the Democrats want to fix immigration or not? There's a bipartisan bill supported by McCain and Kennedy that had two- thirds of the Senate on board, and Chuck Schumer blew it up.

WILLIAMS: OK, so let's have a vote on the bill. Let's have a vote on the bill.

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WILLIAMS: Let's have a vote on...

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KRISTOL: ... have amendments?

WILLIAMS: Now why do you want amendments that water down...

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KRISTOL: ... McCain committed to vote against the amendments.

LIASSON: There's a question about whether these...

KRISTOL: It's total...

HUME: Mara, go ahead.

LIASSON: There are questions -- Senator Specter -- you just heard him say we had the votes to defeat all these amendments. On the other side, the people who are for the amendments, like Senator Hatch, say we could have passed them.

WILLIAMS: That's right.

LIASSON: You don't know that. There has to be an agreement on the number of amendments. Harry Reid wanted only three. There were 20 lined up. Maybe over the next two weeks they'll figure out how to come to an agreement on the number of amendments.

KRAUTHAMMER: I'd vote against it entirely. I think that bill is a mess. The idea of dividing people into how long you've been here -- what do you think, when an illegal arrives he gets a time stamp receipt from the coyote smuggling company? It doesn't happen that way.

HUME: All right, panel. Thanks very much. We'll see you next week.