This is a partial transcript from "On the Record," August 8, 2006, that has been edited for clarity.

GRETA VAN SUSTEREN, HOST: As fighting rages on, civilians in Israel and Lebanon are suffering. Some northern Israelis have been living in bomb shelters since this war started 29 days ago. And now the Israeli government is doing something for its weary civilians. Here with more is the mayor of Kiryat Shmona, Chaim Barbibay. Welcome, Mayor.

CHAIM BARBIBAY, MAYOR OF KIRYAT SHMONA: Hi. Good morning.

VAN SUSTEREN: Mayor, what are you doing to help evacuate or make it easier for those who want to leave Kiryat Shmona?

BARBIBAY: I don't think that people leave Kiryat Shmona. After 29 days, most of the people can stay in the shelter. And we take 1,000 of the people in Kiryat Shmona to refresh himself [sic] and come back to Kiryat Shmona. We don't leave Kiryat Shmona. We don't afraid from Hezbollah. We stay here until the war is finished.

VAN SUSTEREN: What is the population of Kiryat Shmona?

BARBIBAY: The normal population, it's about 24,000. Now stay in Kiryat Shmona 9 or 10,000 people. Most of the people go to the center, to Tel Aviv, Jerusalem, Eilat and somewhere in Israel. But who stay? Ten thousand stay in Kiryat Shmona. They want to refresh himself [sic], and we take them to refresh themselves.

I'm sorry about my English. But if you understand me, it's OK.

VAN SUSTEREN: I think your English is great, sir. I certainly understand you. Mayor, tell me a little bit about your city. What's it like? And what's it like now?

BARBIBAY: You know, 29 days after the bombs of Hezbollah, about 600 bombs, Katyushot, rocket Katyushot, fall in Kiryat Shmona, 1,400 buildings destroyed. It's difficult. It's terrible. But we are strong, and we need the government and army finish this war because Kiryat Shmona, after 32 years in the bomb of Hezbollah, we need a peace. We need quiet. We want to live in Kiryat Shmona like anywhere in the world. We want only to teach our child to work, not to make a war.

VAN SUSTEREN: Mayor, thank you very much for joining us.

BARBIBAY: Thank you.

VAN SUSTEREN: And just hours ago, disturbing news out of the U.N. A U.S. official says the alliance between France and America is falling apart. In a stark turnaround, France is now calling for a complete and immediate Israeli withdrawal from Lebanon and that no international force be deployed. And earlier today, an Arab League delegate said the war is sowing the seeds of hatred and extremism in the area, as the U.N. Security Council allows fighting to continue.

Joining us live is Israel's ambassador to the United States, Daniel Ayalon. Welcome, sir.

DANIEL AYALON, ISRAELI AMBASSADOR TO THE U.S.: Thank you very much.

VAN SUSTEREN: What's your reaction to the disruption in the U.N.? You know, it seemed like there might be an agreement, and now there is not.

AYALON: I think it's very unfortunate, and quite frankly, Greta, I don't understand it. The French were working decisively, I thought, with the United States in order to bring about a new situation in Lebanon, not to return to the status quo ante, whereby Hezbollah can intimidate and threaten everybody and keep the entire region held hostage by them. And now, all of a sudden, there is caving in to all the demands of the Hezbollah.

VAN SUSTEREN: But here's what I don't get. As a tactical matter, Israel wants to clear out that area, to disarm Hezbollah. And the military wants time. To have France sort of pull out or create this problem gives your military more time, and so the idea that France is sort of bowing to the Arab pressure there is sort of unusual to me. In some ways, they're doing the Israeli military a favor.

AYALON: I would say that's the French new position — which I hope it's not going to stand this way. I understand that there are still negotiations between Washington and Paris, so it's not the final word from the French, just to be honest with them. But all these deliberations, or certainly a retreat from the further position, is just going to prolong the war and certainly delay and postpone a ceasefire. And I don't think this is what they want. This is not what anyone wants.

VAN SUSTEREN: I suppose the stalling might help you, but on the other hand, the fact that France is backing down on the multi-national force and that Lebanon wants only Lebanese troops there — why do you think France is pulling out of the multi-national force?

AYALON: It's very strange to me. I hope it's not cowering before terrorism, before violence and before pressure. And if they look objectively into the situation, they would understand that the Lebanese force, the Lebanese army, had 30 years' time to deploy. They had 30 years' time. Certainly, six years since we left Lebanon in 2000, to disarm the Hezbollah. They did not do it because they couldn't do it, and there is not a change now. They will not do it now. This is why...

VAN SUSTEREN: Doesn't Lebanon recognize — I would think Lebanon would recognize the fact that they were unable or unwilling before. I mean, what's different now that the Lebanese troops — and I guess I'm asking the wrong person on this — but you know, I'm having a hard time understanding why you should be convinced that the Lebanese troops are suddenly going to be willing and able to disarm the Hezbollah.

AYALON: We are not convinced at all, and this is not case. This is why the French and the Americans put together a resolution which called for a robust international force which would be able to do it. And without this, Israel cannot disengage because the moment we leave the area, the Hezbollah comes back.

VAN SUSTEREN: What about the civilians who — apparently, the head of the Red Cross has now accused Israel of violating theGeneva Convention in terms of getting humanitarian aid. What is Israel doing in getting aid to those civilians who are basically now locked in the different areas?

AYALON: Greta, you look here at a war which is unprecedented in history. Israel was attacked. Israeli population is under siege. You just saw the mayor of Kiryat Shmona — 1 million of our people are living in shelters, bomb shelters, bunkers, leaving the area. And yet we are being very precise in trying to target only Hezbollah and not to go in a massive way.

We have not used much of our firepower. Why could have flattened the entire area of south Lebanon in a matter of hours. We have not done it. We have not done what the British did in World War II, when they flattened Dresden or Berlin. We have not done even what the allies did in Kosovo, in Belgrade, which killed 10,000 innocents over there.

So I think that the Red Cross is looking at things in a very skewed way, and I would suggest that they would come and visit Kiryat Shmona and visit Israelis and understand that the war has been prolonged precisely because we are being very careful. There are many accidents unfortunately on both sides and we regret them. But the fact is that we are being very precise in targeting Hezbollah terrorist posts only, which is very difficult.

As you know, Greta, there are no camps of Hezbollah per se. They're embedded inside population and this is really the violation of the Geneva Convention.

VAN SUSTEREN: Using civilians, ambassador, thank you sir.

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