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This is a rush transcript from "On the Record," November 12, 2012. This copy may not be in its final form and may be updated.
GRETA VAN SUSTEREN, FOX NEWS HOST: Former State Department official Liz Cheney says the FBI and Justice Department heads are either incompetent or not telling the truth. How could they not consider the CIA director's affair a security risk?
Take a look at this video we just got of Paula Broadwell. She was speaking at a security forum in July.
(BEGIN VIDEO CLIP)
PAULA BROADWELL: I was embedded with General Petraeus in Afghanistan, and it was a little confusing for some of the folks there because I'm also a military reservist with a top secret FBI clearance and then some. So a lot of my former peers didn't know how to treat me. Was I Major Broadwell, or was I journalist Broadwell?
I had -- I had to follow very clear lines of nondisclosure and sign nondisclosure agreements like my colleagues. I felt like I was almost held to a higher level of accountability because I could lose my clearance, yet I wasn't trusted with this opportunity to sit in on high-level meetings with General Petraeus, sit in on the SKIFF meetings in the morning, listen to classified chatter of terrorist talk and so forth.
And I had that background anyhow, so I knew a lot of that information, and I think it was important to inform my writing, but I knew there was a clear line that I couldn't cross when I was writing it out.
So I find it challenging sometimes to justify, or when we had this discussion last night -- you feel like the government is holding something back or not giving the full truth or giving false information. And I think that sometimes, obviously, the government just can't disclose information because of sources and methods and so forth. So that was just reinforced. And I had access to everything. It was my responsibility not to leak it, not to violate my mentor, if you will, and I was writing about a very close mentor.
(END VIDEO CLIP)
VAN SUSTEREN: Liz Cheney joins us. Liz, the FBI right now at this woman's house in North Carolina. Why now? What's your thought?
LIZ CHENEY, FOX NEWS CONTRIBUTOR: Well, you know, it's hard to say exactly. It could well be because of these videotapes we've seen coming out today where she's...
VAN SUSTEREN: Which, by the way, Fox puts out, and they're from October 26th! What in the world is the FBI doing? They're sitting around, watching Fox, waiting for something to come out, or watching Jennifer Griffin's report?
VAN SUSTEREN: I mean, we're doing their work? But go ahead. Sorry.
CHENEY: No, look, I mean, I think that you pointed out a real problem we've got, which is we know now mostly from reporting here, but now you've got mainstream outlets interested in the story, as well, that the FBI director and the attorney general knew this summer that the director of the CIA was having an extramarital affair with a woman who was unstable enough that she was sending threatening emails to somebody. And their claim now is they determined that that wasn't a security risk, and so they didn't alert the president. That just defies logic.
VAN SUSTEREN: So you think the president was alerted?
CHENEY: I think that either somebody was not doing their job or somebody is not telling the truth. I find it impossible to believe the president was unaware, and if somebody knew this information and didn't alert the president, then there's a problem, as well.
VAN SUSTEREN: I think what's so stunning about this is that first we have a CIA director that's got extracurricular activities that's putting -- you know, that makes him potential blackmail material. Then you've got the attorney general of the United States, who knows it in the summer, does absolutely nothing!
But it's just -- it's not like the only thing he's dropped the ball on. I mean, look, after -- after 9/11 hit, it was two or three weeks before the FBI went to Benghazi to look at the place, and then they supposedly picked up anything that was there as relevant, but it wasn't until October 26th when Foreignpolicy.com sent journalists there and they found documents! I don't know what in the world the FBI was doing the first time!
But then you've got the problem that the CIA identifies the man from Tunisia as someone who was there at the time of the assault, and the FBI doesn't talk to him for weeks and weeks and weeks because the administration says Tunisia won't give us permission, but it takes Lindsey Graham a phone call and a letter, and in 24 hours, he gets permission!
And this is the -- the FBI's doing nothing! The attorney general's doing nothing! They're all looking away, and we've got this Benghazi -- now we got this other problem!
CHENEY: No, exactly. And I think that at the heart of the matter, you've got a situation where we've got -- a consulate was attacked, four Americans were killed, clearly a terrorist attack. The administration didn't want to admit that it was a terrorist attack, and their actions since have been not only to mislead the American people and say it was because of a video but to treat it, as you pointed out, as a law enforcement matter!
VAN SUSTEREN: I don't...
VAN SUSTEREN: I don't mind them treating it as a law enforcement matter, but you have a homicide in District of Columbia, and two detectives immediately begin investigating! They didn't do that!
CHENEY: Well, they...
VAN SUSTEREN: I -- I -- frankly, I'd be happy with that!
CHENEY: My view is that they shouldn't be treating it as a law enforcement matter, but they aren't even doing that competently at this point. And I do worry that, you know, the Petraeus scandal is unfolding in this unbelievably fast way. Everybody's very focused on it. Clearly, there was -- you know, there were serious issues and problems here that we've got to investigate.
But we can't lose sight of the fact that the secretary of state has refused to testify. And the secretary of state needs to testify. You would hope that it wouldn't come to a subpoena, given that four Americans under her direct command were involved. But that is exactly what the Congress of the United States ought to do if she will not appear.
VAN SUSTEREN: You know what I'm curious about, and this is -- you know, this a big leap, and it's -- and I'm being perhaps very critical of the director of the CIA, or now former director, but he was being investigated last summer for this. Meanwhile, last summer is when they were getting the cable, "We need more security here." Maybe if they didn't have this other activity going on on the side, he would have paid more attention to his job.
And that may be a huge leap of faith and grossly unfair. However, we do have four -- we do have four dead Americans and we have him telling two different stories, or at least telling a story that's fanciful three days later. So I don't think it's grossly unfair of me to be critical.
CHENEY: No. Look, I think it's right. And I think you've also got the problem of what he told Congress when he was under oath. He apparently went up to the Hill and said this was because of a video. We know...
VAN SUSTEREN: After the station chief said something different!
CHENEY: Within 24 hours that it was a terrorist attack, after the State Department has said, We never thought it was because of the video. There are real problems here, real potential that the extracurricular activities were, in fact, clouding his ability to do his job.
But there's not a single place we've seen now where the administration has done the right thing, whether it was before, denying the security requests, during, not getting reinforcements there, or afterwards, misleading the American people. And the U.S. Congress has got to stay on this.
VAN SUSTEREN: Well, frankly, all this would go away if they would just come forward and be straight on the facts. My suspicion, other people's suspicion would evaporate if we got the straight story. When you get two different stories and you've got four dead Americans, it's -- it's -- it's hard to believe anyone wouldn't be enormously suspicious when your government's giving you two different stories.
CHENEY: Exactly. And now we've learned, given news reporting, that the administration may be preparing to nominate Susan Rice as secretary of state. And I certainly hope that the Congress will follow Lindsey Graham's advice there, and anybody who was involved in this really tragic, tawdry mess ought not be elevated at this point, clearly.
VAN SUSTEREN: Liz, thank you.
CHENEY: Thanks, Greta.