This is a RUSH transcript from "The O'Reilly Factor," September 15, 2011. This copy may not be in its final form and may be updated.
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BILL O'REILLY, HOST: In the "Personal Story" segment tonight: As you may know, former Vice President Dick Cheney has written a new book with his daughter Liz, entitled "In My Time: A Personal and Political Memoir." We have invited Mr. Cheney on the program but he has declined thus far, but his daughter is a different story. So Ms. Cheney is the co-author of the book, but your other co-author, I don't see -- he's not here.
LIZ CHENEY, CO-AUTHOR, "IN MY TIME": Am I chopped liver?
O'REILLY: No, no. We absolutely love you as a guest. But I have never talked to your father, the former vice president. I don't believe he likes me very much, and, you know, I'm a little perplexed.
CHENEY: He could be saving the best for last but I think the fact that I was able to find time in my schedule to appear ought to be something you should be grateful for.
O'REILLY: I am very grateful and you know that. All right. There are two big deficits from the Bush-Cheney administration. The first deficit is the economy that went down the drain at the end. President Bush and Vice President Cheney were taken by surprise because of all the subprime mortgages. My question to your father: Why didn't you know about that?
CHENEY: You know, I think actually they spent a lot of time and they made efforts during the Bush administration to reform Fannie Mae and Freddie Mac and those efforts were blocked by most of the Democrats in Congress. But we did come to a point that was clearly an economic crisis.
O'REILLY: But I still don't understand, and I asked President Bush this himself when I talked to him about his book, why there wasn't a louder cry from the Bush White House, including your father, about the danger of selling these subprime mortgages all over the place?
CHENEY: I think clearly the crisis was deeper than anybody anticipated or could have imagined.
O'REILLY: All right. So they just didn't know how bad it was. That's the fair answer.
CHENEY: No, and they took steps, but the steps were really important so that the economy didn't fall off of a cliff.
O'REILLY: OK. The second one is the Iraq war. You know that I'm a supporter or I was a supporter of that.
CHENEY: I actually didn't know that.
O'REILLY: Well, it's true. I mean, I'm on the record of supporting the enhanced interrogations, the Patriot Act, Guantanamo Bay and, you know, consistently across the line. But there's a historical record and the historical record is that Americans were not aware of the big threat that Al Qaeda was posing.
CHENEY: The record is actually on Al Qaeda that before 9/11, we treated it like a law enforcement problem.
O'REILLY: Yes. And Clinton did and Bush did, and we got wacked.
CHENEY: And I think that is the key difference is that the president and the vice president, Bush and Cheney, understood after 9/11, this is war. And we're at war. We have to do whatever it takes to keep the nation safe.
O'REILLY: All right. Three days before the Iraq war was launched, here's what Vice President Cheney said on "Meet the Press."
(BEGIN VIDEO CLIP)
DICK CHENEY, FORMER VICE PRESIDENT OF THE UNITED STATES: I think things have gotten so bad inside Iraq from the standpoint of the Iraqi people. My belief is we will in fact be greeted as liberators.
(END VIDEO CLIP)
O'REILLY: OK. Obviously, that didn't happen. And I would love to know…
CHENEY: It actually did happen. We were greeted as liberators and then we saw a massive, bloody, dangerous insurgency begin. And it wasn't frankly until we were able in 2006 with the surge to adopt a counter-insurgency strategy that we were able to frankly turn things around.
O'REILLY: OK. But here's why you're wrong. We weren't greeted as liberators. We were greeted in a way that was tentative.
CHENEY: It's not true.
O'REILLY: Yes, it is.
CHENEY: No, it's not. Bill…