• This is a rush transcript from "On the Record," June 20, 2012. This copy may not be in its final form and may be updated.

    GRETA VAN SUSTEREN, FOX NEWS HOST: House Minority Leader Nancy Pelosi blasting Republicans for approving the contempt resolution, Leader Pelosi saying, "I could have arrested Karl Rove on any given day. I'm not kidding. There's a prison here in the Capitol. If we had spotted him in the Capitol, we could have arrested him."

    What is Leader Pelosi talking about? Well, it goes back to 2007, the Bush administration invoking executive privilege. It happened during the scandal over the firing of U.S. attorneys. The focus of the executive privilege assertion, Karl Rove's conversation with Justice Department officials. Then Senator Obama was asked about it during an interview with Larry King.

    (BEGIN VIDEO CLIP)

    SEN. BARACK OBAMA, D-ILL.: There's been (INAUDIBLE) on the part of this administration to try to hide behind executive privilege every time there's something a little shaky that's taking place. And I think, you know, the administration would be best served by coming clean on this.

    There doesn't seem to be any national security issues involved with the U.S. attorney question. There doesn't seem to be any justification for not offering up some clear, plausible rationale for why these U.S. attorneys were targeted, when by all assessments, they were doing an outstanding job. I think the American people deserve to know what was going on there.

    (END VIDEO CLIP)

    VAN SUSTEREN: Karl Rove joins us. Nice to see you, Karl.

    KARL ROVE, FOX NEWS CONTRIBUTOR/FORMER BUSH SENIOR ADVISOR: Great to see you, Greta.

    VAN SUSTEREN: Karl, it seems like every night, you're part of the story somehow. You know, it's -- your name popped up again today with Leader Pelosi saying that she would -- she could have had you arrested. Your thoughts on that?

    ROVE: Actually -- yes, actually, she's absolutely dead wrong. Let's go back -- June, July 30th, the House Judiciary Committee votes to hold me in contempt for the White House declaration that I could not be subpoenaed to discuss internal White House deliberations.

    And they recommended to the House that I be held in contempt, but the House of Representatives under then Speaker Pelosi never took up the resolution, never voted on it. The only way I could have been arrested is if the House had adopted the resolution, which it did not.

    So it's nice to know that Speaker Pelosi wanted to have me arrested. It's nice to know that she thinks she had the power to. But we're still a nation of laws, and she had no authority to do so, and had she attempted to arrest me on any of the number of times that I was in and out of the Capitol, without a resolution passed by the entire House of Representatives, she would have been up the proverbial creek without the proverbial paddle.

    You know, she sounds a little bit like Inspector Clousseau and a little bit about the man red queen. But you know, Speaker Pelosi was dead wrong in her assertion today. I'm sure she had a good laugh, and it's nice to know that she dreams of slapping me in her own personal jail, but didn't have any authority to do it.

    VAN SUSTEREN: All right, well, moving right along, what -- tell me, since you've been -- you've been in this -- you understand this probably as well as anybody. What's your advice for the attorney general tonight and the president?

    ROVE: I'm mystified by it, frankly. Look -- and I hate to reflect back on my own situation, but the White House had a legitimate concern about establishing the precedent that White House staff could be routinely subpoenaed to appear before the Congress to discuss items that involved internal White House deliberations.

    On the other hand, what the White House had offered was, they said, Look, we understand that you want to hear from Rove. We'll provide Rove. Have a -- have a private hearing, swear him in so that if he doesn't tell the truth, he can be prosecuted for doing so. And he will tell you everything that you want to know about his involvement or non-involvement in the U.S. attorney situation. But that way, we protect the form of the president's privilege while giving you the substance of what you want, which is complete, unfettered access to Rove.

    And that's probably why the House never took it up because the White - - and the White House had made this offer, and I suspect some in the House Democratic leadership said, You know what? We're not going to look good if they've offered us this.

    In fact, they took -- they finally took the White House -- the Bush White House up on the offer in March of 2009 and had me spend two days testifying in front of a hapless member of the Judiciary Committee interrogating me, Adam Schiff of California. It was really sort of funny. The transcript is available publicly. He wasn't particularly well prepared nor focused.

    But look, I do think this. I think the President of the United States has made a mistake. First of all, he said explicitly that Fast and Furious had no involvement at the White House, not an item that touched the White House, no White House discussions involved. And yet he is exerting his privilege over a member of his cabinet, which is pretty much of a stretch.

    Was the White House involved or not involved? They said they were not involved, but now by exerting privilege, he's sort of implying that they were.

    And look, you've said it -- you've heard it several times already this evening on various programs and on your own. Sometimes the attempt to cover up is worse than whatever the problem was in the beginning. And if, as Congressman Issa said, the attorney general said these would be embarrassing documents, better that they get the embarrassing documents out than that they continue down this path.

    VAN SUSTEREN: So do you recommend what, tomorrow to have them call up Congressman Issa and say, Let's talk again, and essentially deliver what may be embarrassing documents?

    ROVE: Yes, but you know what? They can't -- they can't at this point. The president has drawn a line in the stand. This is what it is very -- you know, look, 24 times in 30-some-odd, 40-some-odd years executive privilege has been asserted. This is not done routinely, and it's because a president doesn't want to necessarily draw the line. And this president has drawn a line. A guy who went out of his way to castigate...

    VAN SUSTEREN: But how does he get out of it? So basically...

    (CROSSTALK)

    VAN SUSTEREN: Assuming that -- assuming he would like to sort of do a do-over, how does he get out of this?

    ROVE: You know what, Greta? I don't think he wants a do-over. I've got a -- you know, you earlier said, Is this a legitimate expression of executive privilege or is this obstruction? It may be -- you know, it may be a little bit of both. But I'll tell you, I think there's a heck of a lot of politics in this.

    I think the President of the United States would love to have this dominate the dialogue for, you know, a week or two or three. We've got, you know, 20-some-odd weeks left until the November election. I think the president would like to chew up, you know, 5 percent of that, 10 percent of that, 15 percent of that talking about something that is not connected with jobs, the economy, deficit and debt spending, and the Affordable Care Act.

    I think he thinks this is the best of a bunch of bad options and gives him a chance to avoid the kind of dialogue he doesn't want to have.