This is a partial transcript of The Big Story With John Gibson, June 23, 2004, that has been edited for clarity.

JOHN GIBSON,HOST: Big attacks and small, they're all taking a toll on efforts to rebuild Iraq. Joining us now, Michael Ledeen of the American Enterprise Institute (search) and Harlan Ullman of the Center for Strategic and International Studies (search). Today's big question, to you first, Michael, will a terror campaign against Iraqis derail a peaceful transition of power?

MICHAEL LEDEEN, AMERICAN ENTERPIRSE INSTITUTE: No, I don't think so. It's been going on since the very beginning. Everybody knew it was coming. Both Harlan and I predicted it long before the liberation of Iraq, and it's an ongoing struggle.

GIBSON: Harlan, you say it's ongoing ad infinitum.

HARLAN ULLMAN, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES: It's going to go on I'm afraid for a long time. I think there are an awful lot of bad people who have a lot of reasons that they want to overthrow this government, they want to disrupt it. With June 30 coming they're going to use that as a date ...

GIBSON: You have no sense that the Iraqi people want to support this government in any way?

ULLMAN: First of all, I would say that the bulk of the Iraqi people are very unhappy with the American occupation, and I think there's far less support for this government until they prove themselves. And one of the problems with overreacting with what Abu Musab al-Zarqawi (search) is going to say is that this government, because of protection, is going to be finding it increasingly difficult to get out and be with its people. It's going to be increasingly isolated just like the old Iraqi government council was.

GIBSON: Michael, the logic we're operating under here now is, gee, you know, as of July 1, it's an Iraqi government. The Americans go off to their barracks and run security operations, and that's that. Whoever this is setting these bombs off is attacking Iraqis, not the Americans. Does that logic work in Iraq?

LEDEEN: I think really it's a distinction without a difference, John, and I think from the very beginning the countries that have been supporting this terror network — and, remember, Zarqawi we can place very firmly in the axis of Iran. Zarqawi for years operated out of Iran. He's been back and forth to Iran all the time. Europeans have endless transcripts, intercepts, and firsthand testimony of Zarqawi working out of Tehran and working closely with the Iranian revolutionary guards and so forth. It's a regional war. There was never any way we could win this thing in Iraq alone. We were forced into a regional context all the time.

For Zarqawi to come out now and say, well, we're going to kill the new prime minister is no news to anybody. They've been trying to kill every Iraqi that would, first, collaborate with the coalition and, secondly, serve in an Iraqi government, because all those people in Tehran and Damascus who are supporting this terror network know perfectly well that if Iraq is permitted to succeed — if there's a free and Democratic Iraq, they are doomed because their own people will get rid of them. People in the Middle East, by and large, want to see Iraq succeed. Regimes don't.

GIBSON: Harlan, is this an Iranian deal?

ULLMAN: It's beyond Iran. Michael and I agree about the notion of a regional war here. But have you to realize that Saudi Arabia, Pakistan are part of the this in addition to Syria and Iran. And the problem is by focusing on Iraq, we're making it increasingly difficult to deal with the larger problems which are going to take place in Saudi Arabia, Pakistan, and if Michael is correct, with Iran and Syria. In other words, we're dealing with a tactical issue in Iraq when the strategic issue really has to do with the region and the politics of the region. And I'm afraid we're not getting ahead of that power curve. That's the real danger.

GIBSON: All right, if that is the case, Michael, then is there an argument to be made, though, that even though we may be behind the curve on the strategic vision, we have a tactical emplacement in Iraq?

LEDEEN: Oh, for sure. We have to continue to fight in Iraq, and we might get lucky and actually get Zarqawi, although I would really be surprised if Zarqawi were in Iraq today. I don't think he is there. I think he has gone back to Iran, and I think his people are operating in Iraq, and they have elevated now. He used to be a kind of operational commander. Now more and more he is a media star. He has cassettes coming out and media statements. He is up there along with people like Usama bin Laden.

GIBSON: All right, Harlan Ullman, light at the end of tunnel or oncoming train?

ULLMAN: It's a long slog. And, unfortunately, rather like American politicians have learned to become celebrities rather than heroes, I think Michael is right. Some of the bad guys have learned to become celebrities and our media and the way that you can use the Internet and all sorts of communications can add to that, much more than we should make of it. Obviously, they want to try and kill the leadership, and I think we ought not to overreact. This is business as usual.

GIBSON: Harlan Ullman and Michael Ledeen, thanks to both of you. Appreciate it.

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