• This is a rush transcript from "The Journal Editorial Report," August 29, 2009. This copy may not be in its final form and may be updated.

    PAUL GIGOT, HOST: Up next, Eric Holder's assault on the CIA. Will the administration live to regret it? And what's actually in that supposedly explosive report on interrogations? We'll take a closer look.

    Plus, Britain's Lockerbie outrage. Was the freeing of a convicted terrorist part of a deal for oil? And how high up did the decision go?

    And the $9 trillion budget deficit, why even that forecast may be overly optimistic.

    "The Journal Editorial Report" begins right now.

    And welcome to "The Journal Editorial Report." I'm Paul Gigot.

    GIGOT: Attorney General Eric Holder named a special prosecutor this week to investigate allegations of CIA abuse against high-level terror detainees. The appointment of federal prosecutor, John Durham, came the same day as the release of a 2004 internal CIA report detailing that agency's interrogation program. So just what is it not once-classified report? Could Holder be starting a political war that President Obama will live to regret?

    Joining the panel this week, Wall Street Journal columnist and deputy editor, Dan Henninger; Columnist Mary Anastasia O'Grady; Washington Columnist Kim Strassel. And Brian Carney, who joins us from London as the editorial page editor of the Wall Street Journal, Europe.

    Kim, you have read these documents. What's the lesson you take away from it.

    KIM STRASSEL, WASHINGTON COLUMNIST: The press jumped all over this, I think with some prodding from the administration, suggesting this is yet more proof of abuse at the hands of an unleashed CIA. When you read these things, what actually jumps out at you is that this program was actually carefully developed, carefully controlled, widely briefed to Congress and it yielded invaluable results.

    GIGOT: Bret?

    BRET STEPHENS, FOREIGN AFFAIRS COLUMNSIT: That's the key point. There is this obsessive focus with a handful of instances where investigators potentially went over the line. Although, it's important to note that when career Justice Department prosecutors looked at these cases four years ago, they ruled that they did not merit...

    GIGOT: That's interesting. This is an internal report that is being released now, but was begun in 2004.

    STEPHENS: And was shared with Congress.

    GIGOT: And was shared with Congress and turned over to Justice and career prosecutors did not prosecute except in one case of abuse where a detainee was killed by being hit on the head, apparently with a flashlight. That interrogator was prosecuted for assault and convicted.

    STEPHENS: I think it's a key point to note the people who looked into this were career prosecutors. This wasn't the Bush administration or its appointees going against the bureaucracy of the Justice Department.

    MARY ANASTASIA O'GRADY, COLUMNIST: Paul, the other thing about this that jumps out, besides the fact that the report says the Counterterrorism Center did a commendable job in staying within the rule of law and interrogating these detainees, is that the interrogators reported that they were quite concerned that they were going to be, at a later date, prosecuted in some way. They suspected the U.S. government would not stand behind him even though they were following the rules. That's precisely what's about to happen to them.

    GIGOT: Yeah, they said one quotes was very telling. It said, ten years from now, we will regret this, but it must be done.

    Another thing that's interesting here, Brian, is the results that were relayed about how they very useful information that ended up exposing, including plots to attack the U.S. Consulate in Karachi, hijack aircraft and fly them into Heathrow, using track spikes to derail U.S. trains, and several others. Had any of those happened, of course, it would've meant the death of innocent Americans

    BRIAN CARNEY, EUROPE WALL STREET JOURNAL COLUMNIST: Right. and one of the lines we hear over and over again is torture doesn't work. Torture is ineffective. Now nothing detailed in this report obviously, except for the one case that was prosecuted, really looks like what most people would think of as torture. I think people get treated worse every day in the police stations in major cities around America.