• This is a partial transcript from "Your World with Neil Cavuto," August 2, 2006, that was edited for clarity.

    NEIL CAVUTO, HOST: Well, sustainable peace, you have heard the president say it, Secretary of State Condoleezza Rice say it, and, again today, White House Press Secretary Tony Snow say it.

    (BEGIN VIDEO CLIP)

    TONY SNOW, WHITE HOUSE PRESS SECRETARY: You are assuming that an immediate cease-fire was — we want a cease-fire immediately. No, we want a cease-fire that is sustainable.

    (END VIDEO CLIP)

    CAVUTO: So, What exactly does that mean, sustainable peace?

    General Alexander Haig says it is the complete dismantling of Hezbollah. Of course, the general is the former secretary of state under President Ronald Reagan.

    Secretary, General, always good having you. Thanks.

    ALEXANDER HAIG, FORMER SECRETARY OF STATE: Good to be with you, Neil, always.

    CAVUTO: Sir, what do you make of that? What — what is sustainable peace? What do we have to do to get it?

    HAIG: Well, we are getting a little late start, I'm afraid.

    But now that it is under way, it means precisely what the president has been saying all along. And he is exactly right — and the same with the secretary of state and the press secretary. And that is a peace that will be permanent. That means a cease-fire which is going to remove the possibility of an immediate resumption at the will of Hezbollah or Iran, which, of course, is the master strategist behind it all.

    CAVUTO: I wonder, though, General, if Hezbollah has all but indicated: Look, under these conditions, you won't have that. We are not going to fully disarm.

    Israel is saying: You have got to fully disarm.

    So, there is no middle ground here, it seems. Or is there?

    HAIG: Well, this, of course, is what the U.N. ordered them to do some years ago, and they were totally ignored. And the U.N. secretary-general presided over that ignoring of their own mandate. And now he has joined Hezbollah on most issues.

    So, what we have to do is move very, very carefully to be sure that both Syria — which is only a stooge of Iran — and Iran are in agreement that they are going to have to terminate support for what is — will be left of Hezbollah. It won't be totally destroyed.

    And it couldn't be, even if we wished it to be, because they are recruited hourly and moved in by Iran and Syria.

    CAVUTO: You know, I...

    HAIG: So...

    CAVUTO: I know I am stating the obvious, General, but Hezbollah is part of the Lebanese government. And, with or without arms, it will be a continuing part of that government, a body that says it not only doesn't like Israel, but wants it destroyed.

    How do you enter into negotiations, then, with a sovereign nation that has a key part of it all but effectively saying, we hate you and want you dead?

    HAIG: No. You know, when you say Hezbollah is a legal part of the Lebanese government, that is a horrible distortion of reality. They have been a takeover. And they are in a takeover condition, and they have been.

    CAVUTO: Yes, but they have seven seats in parliament. I mean, say what you will.

    HAIG: Only by the dictate of a puppet prime minister.

    CAVUTO: Fine. Fine.

    But I'm saying, we can't have the Lebanese government sort of reinvent itself, right? If this is what the Lebanese want, by puppetry or whatever else, General, I mean, are we stuck with having to realize that...

    HAIG: No.

    CAVUTO: ... future negotiations will involve Hezbollah, armed or unarmed?

    HAIG: What we need is credibility, which has been damaged badly by some naiveté on our part over a number of years.

    You recall I had some problems with that, even when I was secretary of state in as strong a presidency as the Reagan presidency.

    CAVUTO: But you...

    HAIG: But that was at a time when he was not too well.

    CAVUTO: Right. But you were one of the first to have to deal with the Beirut bombing and the loss of so many of our soldiers then, the first taste of what Hezbollah was capable of.

    So, could any talks or discussions now bear any fruit at all? I don't mean to sound jaded, but I see little in the equation that does.

    HAIG: No, of course it can be done. And it has to be done with credibility.

    And that's the realization that anybody that violates what are sustainable conditions is either going to be punished immediately, is going to suffer retribution, which they will prefer not to suffer. And that includes Iraq and those in Iraq that might be parlaying, the Shiites, Iran, and, above all, Syria, although I would try to break Syria out of this stranglehold from Iran.

    CAVUTO: All right.

    General, always great having you on. Thank you for stopping by.

    HAIG: Thank you.