This is a partial transcript from The Beltway Boys, November 30, that has been edited for clarity. Click here to order the complete transcript.

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FRED BARNES, CO-HOST: Welcome back to The Beltway Boys.

Our next guest says the most dangerous and oppressive brand of Islamic extremism isn't found in Iran or Iraq but in America's closest Arab ally, Saudi Arabia. And he says it's about time the Bush administration wises up.

He's journalist Stephen Schwartz, author of the new book The Two Faces of Islam: The House of Saud, From Tradition to Terror.

Welcome, Steve.

STEPHEN SCHWARTZ, AUTHOR, THE TWO FACES OF ISLAM: Great to be here.

BARNES: Well, I've read your book. It's a terrific book. I highly...

SCHWARTZ: Thank you.

BARNES: ... recommend it. But here's my first question, and that is, as you know, the wife of the Saudi Arabian ambassador to the United States gave some money to a man who turned out to be a close friend and supporter of two of the September 11 hijackers.

SCHWARTZ: That's right.

BARNES: Now, is this a scandal? What do you make of this?

SCHWARTZ: Well, I think this shows the situation inside the House of Saud, inside the Saudi government, and inside all of its institutions, including its embassies and other diplomatic institutions.

The connection of the House of Saud with Wahhabism, this extremist form of Islam, is so close that it's almost -- it would be hard to imagine the president -- the princess not realize, not realizing that, that this would be a problem to hand this money around.

It's very hard for me to accept that idea, because she knows that the whole of Saudi society is saturated with this extremism. She knows that they supported the Taliban, did all these other things. It just doesn't make any sense to me to suggest that this was done in some unknowing way.

JUAN WILLIAMS, GUEST CO-HOST: Now, Steve, how many of the 9/11 hijackers subscribed to this radical brand of Islam called Wahhabism?

SCHWARTZ: Well, the whole Al Qaeda movement is a Wahhabi movement. That's all it is. Everybody who joins Al Qaeda is a Wahhabi. There are no non-Wahhabis in Al Qaeda.

WILLIAMS: Well, if that's the case, then, explain to me why President Bush would have had someone at his Crawford ranch who subscribes to this thinking. There's a review of your book, a very positive review, I might add, in The New York Times that begins -- it's by Richard Burston -- it begins, "In April of 2002," that's this year, "eight months after the attacks of September 11, a Saudi cleric who preached in mosque in the Saudi capital of Riyadh and called for the enslavement of Jewish women was welcomed at President Bush's ranch."

SCHWARTZ: Well, the thing is that any Saudi representative, aside from Crown Prince Abdullah himself, who comes to the United States and goes to visit our president, is a Wahhabi. Wahhabism is the state religion of Saudi Arabia.

Aside from Crown Prince Abdullah, who, I'm told, wants to move the regime away from this extreme form of Islam, anybody that comes in the door representing Saudi Arabia at this point is a Wahhabi, whether it's Prince Bandar, Prince Sultan, or the kind of people that went down to Crawford.

They're all Wahhabis. That's what they are. That's what the Saudi regime is about. It's a regime based on this extremely ideological and radical form of Islam.

BARNES: Well, Steve, why does Saudi Arabia have this reputation as a moderate Arab state, as the leading moderate Arab state?

SCHWARTZ: The whole history of Wahhabism and Saudism, that is, of the Saudi, the Saudi family and their adventures in politics and in statecraft, is the history of, first of all, hypocrisy. They've always preached this ultraradical form of Islam while depending on the Christian powers, Britain, the United States, France, to defend them in the peninsula.

That's the main problem.

BARNES: Well, so, we defend them because of the oil.

SCHWARTZ: That's right. Well, of course. And the bottom line is, big oil and cheap gas is what it's all about for us.

WILLIAMS: But you know what I don't get, Steve, when you stop and think about it, and this comes through loud and clear in your writings, if you think about Saudi Arabia and its subscription to this Wahhabism, you're talking about a force that's against the free will of women...

SCHWARTZ: That's right.

WILLIAMS: ... antidemocratic...

SCHWARTZ: Absolutely.

WILLIAMS: ... right? So anti...

SCHWARTZ: Anti-Muslim.

WILLIAMS: ... anti-Muslim, because it goes after other branches of Islam...

SCHWARTZ: That's right.

WILLIAMS: ... so exactly what is it that makes Americans and British, for a time, open their arms to these people?

SCHWARTZ: Well, when it began, it was the fact that the British were willing to support the Wahhabis against the Turkish Empire, the Ottoman Empire, which was then the dominant state in the world of Islam. I mean, Fred put it very well, since 1937, it's been about the oil.

BARNES: Steve, let me ask you about something you wrote. You wrote, in your book, "The special relationship between the United States and Saudi Arabia has become an obstacle to American security interests." In what way?

SCHWARTZ: Nine-eleven, what else? I mean, the fact is, the Saudi regime, if it was a normal regime, and if they were the great friends of our country that they say they are, on September 12, Crown Prince Abdullah or Prince Sultan, probably -- I think better Prince Sultan, would have said, We're going to thoroughly investigate this, we're going to give you the report you need. We're going to back you up to make sure that this never happens again. We're going to arrest the perpetrators no matter how high they are in Saudi society and put them on trial.

They haven't done any of this. All they do is keep giving us these excuses and telling us about things they're doing behind the scenes.

WILLIAMS: Now, Steve, your book really has an optimistic tone to it, because you expect somehow that there is going to be some rapprochement between Wahhabis, Israelis, the rest of the world. Why?

SCHWARTZ: No, no, no. I don't think there's going to be a rapprochement between Wahhabis, Israelis, and the rest of the world. I think there's going to be a rapprochement between traditional Muslims, who have been attacked and oppressed by the Wahhabis, and who resent the situation in Saudi Arabia and resent the Saudi and Wahhabi control of the holy sites Mecca and Medina, with the traditional Muslims who are the majority of Muslims of the world, especially after the crisis caused by 9/11, I think there is the possibility open now of a dialogue between the traditional Muslims and the West, including Israel.

BARNES: Steve, thanks very much.

SCHWARTZ: Thank you.

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