• This is a rush transcript from "The Journal Editorial Report," August 21, 2010. This copy may not be in its final form and may be updated.

    PAUL GIGOT, FOX HOST: This week on the "Journal Editorial Report," the mosque of misunderstanding. Did the president needlessly elevate a destructive controversy? And does America have a moderate Muslim problem?

    Plus, the Blago trial ends with a whimper, the latest in a string of white-collar crime crack ups for the Justice Department. Is there something wrong at the U.S. attorney's office?

    And Obama steps out, stumping in some key states and polishing his fall campaign rhetoric. But will his blame-Bush strategy work?

    Welcome to the "Journal Editorial Report." I'm Paul Gigot.

    Two high-profile Democrats broke with President Obama this week over his support for a proposed Islamic community center just blocks from Ground Zero. Senator Majority Leader Harry Reid and former Democratic National Committee Chairman Howard Dean came out in favor of moving it to another location.

    Meanwhile, the man behind mosque, Imam Faisel Abdul Rauf, left this week for a three-nation Middle East tour on behalf of the U.S. State Department. Rauf will travel to Bahrain, Qatar, and United Arab Emirates, where he's expected to discuss Muslim life in America and religious tolerance. It's his fourth such trip for the government. He made a similar tour in 2007 on behalf of the Bush administration.

    Joining the panel this week, Wall Street Journal columnist and deputy editor Bret Stephens; assistant editorial page editor, James Freeman; and Washington columnist, Kim Strassel.

    Bret, one of the undercurrents of this debate is the issue of moderate Muslims, who we need as allies. We have them at allies in Iraq, Afghanistan and elsewhere. How do you think they'll react to the debate over whether this mosque should be at Ground Zero?

    BRET STEPHENS, COLUMNIST AND DEPUTY EDITOR: I don't think it's particularly relevant how they're looking at this particular mosque controversy. I think what's really relevant is the question of Muslims in America and what this mosque is supposed to represent. What this mosque is really trying to do or at least what this imam purports to do is a kind of outreach to wider the American community, presenting a kind of a new face of — or a different face of Islam.

    If that is actually the imam's goal, he's obviously not succeeding at the task. He's been approached by Governor Paterson of New York and others to try to move the mosque to a different location, one that's less sensitive. And so far, he's refused. So if he wants to prove his moderate bone fides, I think useful step he can do is to bend in the direction —

    GIGOT: So you're saying —

    STEPHENS: — of people like Howard Dean and Senator — Senate Majority Leader —

    GIGOT: You're saying he's the provocateur here, that he's provoking this, that he's trying to make a political statement instead of a religious statement?

    STEPHENS: That's precisely it. If he wanted to make simply a religious statement, you could put up the mosque anywhere in this country, not two blocks from Ground Zero. You wouldn't have to build $100 million facility on 13 stories with facilities that go vastly beyond the functions of a simple site of religious worship.

    GIGOT: James?

    JAMES FREEMAN, ASSISTANT EDITORIAL PAGE EDITOR: I think this is the great thing about America. You don't have to prove to anyone that you have moderate views. I think, while critics of the mosque or the community center, depending how you want to describe it, have the free speech right to criticize this, I think it's the wrong thing to do.

    And I think people are conflating the issues here. We don't need to demand that all Muslims have a 21st century midtown Manhattan view of the world. All we — all we demand is that they don't fly planes — planes into buildings. So that population is very small and that's very small here. It's very small even in the Middle East. That radical group is not a large population. And the reason you know that is the Taliban groups like this, they come to power at the point of a gun. They wear out their welcome. They break eggs to make an omelet, except there's no omelet. The radicals are a small group and that's who we ought to be focusing on.

    As you said, I think looking at allies overseas, this is a little late in the day to say that — to suggest maybe the larger Islamic community is a problem.

    GIGOT: Aren't you risking alienating the larger Islamic community, which wants to assimilate in the United States, which — by saying, look, you try to build the mosque and we don't want it.