This is a partial transcript from On the Record with Greta Van Susteren, March 15, 2004 that has been edited for clarity.

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GRETA VAN SUSTEREN: Tonight: Spain's incoming leader is vowing to pull his troops out of what he calls a disastrous occupation of Iraq. In a surprise upset, the socialist leader swept his pro-American predecessor at the polls just days after the Madrid massacre.

Angry voters said the foreign policy of Spain's ruling conservative party made them targets for terror. But did Spain cave in to terrorists who used influence -- or used violence to influence their national election? And can anyone stop terrorists from wreaking havoc here at home in November?

Joining us from Boston is former presidential adviser David Gergen, now the director of the Center for Public Leadership at Harvard's Kennedy School of Government.

Welcome, David.

DAVID GERGEN, FORMER PRESIDENTIAL ADVISER: Hello, Greta.

VAN SUSTEREN: David, are you convinced that this terror did sway this election? Going into the election, about 90 percent of the Spanish people were opposed to us going into Iraq, yet last week, the polls showed that the two candidates were relatively close. So did terror push this election?

GERGEN: I'm afraid it did, Greta. It -- certainly, the events from the time that the bombs blew up through the election pushed the voters over. The polls showed just before the bombings that the conservative incumbent party was about 3 to 5 points ahead. The other party, the socialist party, wound up winning the elections by about 5 percentage points. So there was a -- there was a swing of about 8 to 10 points.

Now, part of that, probably -- I'm sure came from the bombing itself and the anger over that. But part of it, I must say, looks as if it came from the stupidity of the government itself, in the way it handled the bombing. They could have said, We simply don't know who did this, and we're investigating it, and obviously, we're putting every resource we have onto it on an emergency basis. Instead, they blamed domestic terrorists, the Basques.

And when evidence came out the other way, there were many voters who apparently were angry at them for lying, for covering it up. And that may have accounted for the election defeat as much as their earlier policy on Iraq.

I'm afraid from the Bush administration's standpoint, the interpretation is this has everything to do with Iraq and nothing to do with the way the government handled it. But I think the stupidity of the government contributed to it, and we ought to know a lot more about how much that drove the election results.

VAN SUSTEREN: You know, David, I'd be surprised if in this country, if the shoe were on the other foot and that happened to us, if that would sway an election, with sort of the American resolve on issues like this. I mean, obviously, if someone got caught in a lie, a political party -- like, maybe that's what happened in Spain, I don't know -- it might have an impact. But I'm a little bit surprised at this.

GERGEN: I don't think that -- I certainly hope that al Qaeda doesn't read into this that they can disrupt an American election, the way they have a European election. The likelihood is it would run -- the events would -- the public opinion would run just the other direction.

And that is, if we're attacked, you know, there is the famous "rally around the president" effect. And in this case, if we were attacked again shortly before the election, every single American would remember how George Bush (search) rose to the occasion after 9/11 (search). That was his finest hour. That was his most decisive hour of leadership, in the weeks following 9/11.

And I think -- I think that an attack against the United States shortly before our election would very likely drive up the president's votes by a high margin. The only caveat to that, the only qualifier, is if it looked as if they caught us with our guard down, if there had been negligence on our part and then they hit us and got through our defenses. But under normal circumstances, Greta, I think it would go just the other way, that it would help the sitting government.

VAN SUSTEREN: Looking at the big picture of Spain, now that it has a socialist government in power and not the one that had been sort of the supportive candidate for the United States, how does that change the dynamics for us in Western Europe?

GERGEN: Not well. And unfortunately, it's going -- we're going to have to scramble now. I think it's going to drive a wedge initially between us and Europe that's even deeper than what we've seen in the past. It's going to make other countries that have been our friends a little less anxious to join up with us because their publics might turn against them and vote them out.

But I do think that this is -- I think that if the Bush administration is smart, if it's aggressive, if we launch a diplomatic offense now on a couple of fronts -- if we were to go in now and offer every single intelligence resource we can to the Spanish government to get to the bottom of this and bring all the culprits to trial and make sure that they're protected in the future, think that would help a lot. It would demonstrate our solidarity with the Spanish people.

And I think in addition to that, we do need to reach out to the Spanish people who are disaffected. We cannot just simply say, now that they've got a socialist government, the hell with you. We need to keep this relationship up. It had -- they had -- the Spanish government was a brave ally of the United States here in the last months, and I think now, with a diplomatic offensive -- also, you know, we've been talking a lot about aiming our public diplomacy at Muslim nations, about bringing over the hearts and minds. We need a public diplomacy that's on the offensive in Europe. We need to make sure the Europeans stay with us. We do not -- cannot afford to be isolated in this fight against terrorism.

VAN SUSTEREN: But I don't know how we can possibly win over Spain right now because even going into the election, 90 percent of the Spanish people were against going into Iraq. I mean, so in many ways, you know, there was sort of a mandate from the Spanish people about America going into Iraq.

GERGEN: I think that's right, Greta. And there's no question we're pushing something uphill. But I do think if they see us now coming to their support, to get at who did this -- and one of the strands -- after all, we need help with our intelligence on many fronts in the world. The Spanish clearly need more help on their intelligence side to figure out who the heck is this, where are they coming from, what are the other links into the rest of Europe, back into the Muslim world, wherever they may lead.

They need intelligence cooperation that the United States can now give them and can lead a massive worldwide effort among intelligence agencies to solve this problem, to help the Spanish get to the bottom of this.

And if we're seen as doing that and being there for the Spanish, as being supportive of the Spanish in their hour of need, just as the Spanish were for us at our hour of need, I think that will help to heal some of these wounds. There are some obvious deep wounds now, but that doesn't mean we ought to give up. We ought to come right back and be very, very much on the offensive.

VAN SUSTEREN: All right, David, thank you very much.

GERGEN: OK. Thank you very much.

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