This is a partial transcript of "Special Report With Brit Hume," May 13, 2005, that has been edited for clarity.

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(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, U.S. SECRETARY OF STATE: We have called on the Iranians to take advantage of the opportunity that the Europeans have given them to demonstrate that they are prepared to live up to their international obligations. That means that the Iranians cannot be allowed to develop the technologies that would lead them to be able to build a nuclear weapon undercover of a civilian nuclear program.

(END VIDEO CLIP)

JIM ANGLE, GUEST HOST: Has the Axis of Evil (search) gone nuclear? North Korea brags about it, of course, but Iran (search) denies it, though they’ve spent 18 years hiding their nuclear research efforts. Iran suspended its nuclear activities in negotiations with Europeans last fall but is now threatening to start back up. And that promises to turn into a full-scale crisis next month.

What happens next? For answers, we turn to Joe Cirincione, director for the Nonproliferation Project at the Carnegie Endowment for International Peace here in Washington.

Joe, welcome. Thanks for coming in.

JOE CIRINCIONE, CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE:My pleasure, Jim.

ANGLE: Let me ask you first on Iran. They deny that they are pursuing nuclear weapons, that they are only pursuing nuclear power. There is widespread skepticism about that claim. Why?

CIRINCIONE: Three reasons, first, when they started the program -- it originally began under the Shah. The Ayatollah Khomeini (search) shut it down. But they restarted it during the war with Iraq in the mid ‘80s. It was unlikely they were thinking about nuclear power when they restarted this program.

Second, they now have 18 years of trying to hide their efforts. And we have 14 specific instances of them lying about their activities. And finally, there are some activities that look extremely suspicious, weapons- related, not at all related to civilian power pursuits.

ANGLE: Now, the Europeans have been in negotiations. The U.S. is standing on the sidelines here. The Europeans got them to suspend their enrichment activities last fall. Talk briefly about what the difference is between nuclear power and nuclear weapons, and about the success of the Europeans so far.

CIRINCIONE: Sure. Iraq has one nuclear power plant under construction right now. It’s going to go online next year. And it’s planning six more over the next 10 years. The problem is not the nuclear reactor. It’s what goes into it and what comes out of it. Most countries buy the fuel from other countries, like the United States, Canada or Russia (search).

ANGLE: And it’s cheaper to do, right?

CIRINCIONE: And it’s cheaper to do. It really doesn’t make any sense to be producing your own fuel unless you have 20 or 30 reactors.

ANGLE: And they are talking only about six.

CIRINCIONE: They’re only talking about six right now. But they want to have their own fuel plant, their own ability to enrich uranium for the fuel rods.

The problem is, the same technologies, the same machines that enrich it to low levels for reactor fuel can enrich it to high levels for bombs. And there’s no way to stop a country once it decides to do that, once it has the plant.

ANGLE: Now, we said at the top that they had suspended their enrichment activities last fall in negotiations with the Europeans. They are now threatening to take that first step, to go back into uranium conversion efforts, take that first step back on the road to enrichment. That puts them on a collision course with the Europeans and with the Americans.

CIRINCIONE: The Europeans have drawn a red line, and they’ve made this very clear at the highest levels. We just heard Prime Minister Tony Blair (search) reassert it yesterday.

If the Iranians restart this enrichment activity at any level, actually doing it, or assembling machines, or preparing the gas that goes into the enrichment process, the Europeans will consider the negotiations over and will join the United States and bring Iran to the Security Council.

ANGLE: It almost seems as if Europeans are saying, "Hey, guys. We are trying to work with you. But if you cross this line, we’re going to have to deal with those crazy Americans. And you know, they take a pretty hard line on this sort of thing."

CIRINCIONE: We have to remember these are negotiations. And I think that is the European posture here. And it’s somewhat useful to have crazy Uncle Sam back there over the shoulder. You don’t know what he’s going to do. So it works for the Europeans.

On the other side, the Iranians are saying, "Look, this has become a big, national issue in Iran. We have just started a presidential election." They have an election in June. "This is a big popular issue. We have to defend our rights." So a lot of what you are hearing from the Iranians these days is really directed at their domestic audience. Nobody wants to be weak on this issue, weak with the Europeans.

ANGLE: Right. So you think this will come to a head after the elections?

CIRINCIONE: I think everything is frozen until the elections. You will hear some posturing, some back and forth. But as Iranians just indicated today, they’re willing to suspend anything to do with their enrichment, or lifting the enrichment activities, until we have further talks. Read that as meaning until the elections on June 17th.

ANGLE: OK. Let’s talk about North Korea for a moment. They were begging for attention this week, as they do every so often, by saying that they were pulling fuel rods and taking the next stop toward producing nuclear weapons. What is going on? Where are they?

CIRINCIONE: Well, the North Koreans are expert at yanking our chain. And they know when our satellites pass over, and they do these little activities that look suspicious. We had a little panic here in the United States in the last couple of weeks over some people thinking that the North Koreans were preparing for a nuclear test.

Were they? Were they just preparing some trucks? Or was it overeager analysts and the front-page story of The New York Times that really got a little ahead of the game here?

The North Koreans, I think, have not yet made up their minds about whether they are willing to negotiate their nuclear weapons stockpile away or whether they are going to try to be like Pakistan, just do it, test a weapon, and everyone will get used to it.

Right now, we have China and South Korea saying two things. One, to North Korea, "Come back to the table. It’s time to negotiate. Don’t push this all the way to a test." And those same countries saying to the United States, "You guys come back to the table, too. Show a little more flexibility here. There is still a chance to work out a deal."

ANGLE: Now, the Chinese seem to indicate they didn’t want to put any pressure on the North Koreans, but they also said that there’s no evidence that there’s any nuclear weapons. If there were evidence, it seems it leaves room for the Chinese to take a much tougher line.

You got about 20 seconds.

CIRINCIONE: That’s, I think, why North Korea is not going to test. That would push China too far. China is trying to be the mediator here. They don’t want to be the heavy big brother and crack down on North Korea. And they don’t want an unstable North Korea unleashing an immigration crisis on their border.

ANGLE: Great. Joe, thank you very much. Joe Cirincione.

CIRINCIONE: My pleasure.

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