• With: Israeli Prime Minister Benjamin Netanyahu

    This is a rush transcript from "On the Record," March 7, 2012. This copy may not be in its final form and may be updated.

    GRETA VAN SUSTEREN, FOX NEWS HOST: It is no secret nations are terrified that Iran is working on a nuclear weapon. Iran has repeatedly threatened Israel, including a threat to wipe it off the map. Is Israel going to do anything about it?

    Prime Minister Benjamin Netanyahu, here in Washington, meeting with President Obama, and then going "On the Record."

    (BEGIN VIDEOTAPE)

    VAN SUSTEREN: Mr. Prime Minister, nice to see you, sir.

    BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: Thank you. It's good to be with you again, Greta.

    VAN SUSTEREN: And welcome back to the United States.

    NETANYAHU: Thank you.

    VAN SUSTEREN: We had fun talking -- I enjoyed talking to you last fall when you were here.

    NETANYAHU: Indeed.

    VAN SUSTEREN: Last night, I listened very carefully to your speech, very carefully. And in fact, I have a transcript of it in front of me. And it says that the international community's tried diplomacy, that hasn't worked, that the community has applied sanctions, that hasn't worked, either, that there are efforts to impose tougher sanctions, but Iran's nuclear program continues in spite of that.

    You said Iran's goal is to develop nuclear weapons, and as prime minister, you will never gamble with the security of Israel. It sounds like war is inevitable.

    NETANYAHU: Oh, I don't think so. I mean, we've seen, in fact, that Iran backed off from its nuclear program, its nuclear weapons program, really only once in the 15, 16 years that I've been warning the world about the dangers of a nuclear-armed Iran. And the only time they backed away was in 2003, when they thought there'd be a credible military threat against them.

    So in fact, the paradox is that if they actually believe that they're going to face the military option, you probably won't need the military option.

    VAN SUSTEREN: And I guess that's why -- I suppose that Secretary of Defense Panetta's statements that military options are on the table and President Obama's statement, as well, is helpful to discourage Iran.

    NETANYAHU: I think these are important statements. I think that the idea that containment vis-a-vis a nuclear Iran is not an option are important statements. Just remember what it means. You try to contain a regime that is fostering terror worldwide, that could use nuclear terror here at any city, any port. That's a very dubious proposition.

    So I think all these things are important, as was the president's statement of something that is very true about the ethos of what Israel is all about, that Israel, as a sovereign country, must have the ability to defend itself by itself against any threat. And as a sovereign country, we have the right to decide to act in our own defense.

    VAN SUSTEREN: Is there anyone that disputes that, though, that Israel doesn't have a right to defend itself, doesn't have a right to its sovereignty? I mean, obviously, the sovereignty (INAUDIBLE) but the right to defend yourself.

    NETANYAHU: Well, you know, it's a question of the assessment of when have you to activate that right. I think that's the real important thing. I think the reiteration of that basic proposition was important. I think it -- you can't repeat that too often.

    VAN SUSTEREN: I guess that means a little bit in terms of preemptive, whether you preempt Iran taking nuclear action, building a bomb, is whether you go in there ahead of time? Is that what you mean?

    NETANYAHU: Well, I mean that -- I mean that the Jewish people were faced often in our history with a situation that people try to destroy us. In fact, they did destroy millions of Jews in the last century. And we could do nothing about it because we had no sovereign state.

    Now they still try. They still threaten to destroy us, but this time, there's a state of Israel, and if necessary, we'll act in our own defense. And I think it's very important to repeat that clearly. And obviously, this is something that is perhaps the most -- the primary -- the supreme responsibility that I, as the prime minister of Israel, have, to -- to guarantee that the future of the Jewish state, the Jewish future, is secure.

    VAN SUSTEREN: You talk about the Jewish future, but you also touched on last night that if Iran gets a nuclear weapon, obviously you are in the direct line of fire and Ahmadinejad has made very derogatory marks and stated his very ugly intentions towards Israel.

    NETANYAHU: Now you are being a diplomat. He said that Israel should be wiped off the face of the earth and they are developing nuclear weapons to do it, for that purpose. Not only for that. They could shut down the Straits of Hormuz. They are threatening that. You are worried about the price of oil today. Think about what it would mean if Iran, this radical regime that chants "Death to America! Death to Israel!" A, they get their hands on atomic bombs. They could use it against any one of us, b, they could give it to their terrorist proxies to use against any one of us, three, they could threaten credibly to block the Straits of Hormuz, which would send the price of oil skyrocketing, not anything that even remotely resembles what we have now, and they will pocket the dough because they are oil producers.

    So these are things that could change the world. It could be like a hinge of history. We could live in another time. We have never had since the advent of nuclear weapons a regime that could act with such irresponsibility having those weapons of mass death.

    So I think this is something that we should -- we should talk about. Everybody talks about the -- you know, the costs of taking action, to stop Iran. I think it's important to start on the cost of not acting to stop Iran, of a world in which the ayatollahs would have atomic bombs. I think that would be catastrophic.

    VAN SUSTEREN: Do you have a sense that other nations have that sense of seriousness that you have about this issue? Or do you think many nations think we can talk our out of this a little bit?

    NETANYAHU: I think they would like it see Iran agree to the dismantling nuclear program. I think they are trying to press them to do that. The pressures have been applied. They have intensified. The economic sanctions hurt Iran, economically, no question about that. But so far, it hasn't -- these sanctions haven't achieved the one goal they have, which is to make Iran stop their nuclear weapons program.

    VAN SUSTEREN: Do you have any doubt they have a nuclear weapons program?

    NETANYAHU: God, I said yesterday, what do you think Iran is doing all of this -- developing these underground halls with thousands of centrifuges to enrich uranium, underground nuclear facility. They're building ICBM, intercontinental ballistic missiles, to carry, what? Medical isotopes? That's their explanation? They are absorbing these crippling sanctions. And I said yesterday, what are they doing it for? I said yesterday, if it looks like a duck, if it walks like a duck, quacks like a duck -- it's a duck. It's a nuclear duck.

    So I don't think anyone seriously thinks that Iran is doing all of this, going through all of this huge investment, taking huge risks for anything but a nuclear program, and I think we should recognize that.

    And the second thing we should recognize is that so far we have not been able to stop their nuclear program, notwithstanding the tough sanctions that have been applied. They are still going away. And, by the way, that's not what I am saying. That's what the International Atomic Energy Agency, the IAEA, just said yesterday. They published a report and said that Iran is continuing and in fact accelerating its program. For god's sakes, Ahmadinejad is taking people on guided tours of these facilities. People, the international inspectors are actually saying there is material near low enriched uranium for five bombs and they are enriching uranium now at a higher level to give them their nuclear weapons. I think there is no question.

    VAN SUSTEREN: I guess I asked because is one of the things that the more we talk and have diplomacy, there is more of a chance to build more, develop more. So diplomacy does have its drawback that way, spending a lot of time talking if they don't stop the program.

    And the other problem too is in 2003, with weapons of mass destruction in Iraq, there was so much certainty and it turned out, our intelligence was wrong on that. So I am trying to balance the two.

    NETANYAHU: First of all, there is no question. There is no comparison. In the case of Iraq, I was on the Israeli cabinet when we discussed this issue. We didn't know. We couldn't say that they didn't have a nuclear weapons program, we couldn't say if they did. In the case of Iran there is absolutely no question. We share all of that information. We know the stockpiling of enriched uranium. We know the development of ICBMs. We know a lot more. And we share this information. I don't think that's comparable to --

    VAN SUSTEREN: What's the timeline? How much time do we have?

    NETANYAHU: Every day that passes makes it closer and closer.

    VAN SUSTEREN: Is it weeks, months, or years?