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Transcript: Secretary of State Condoleezza Rice on 'FOX News Sunday'

The following is a partial transcript of the Sept. 10, 2006, edition of "FOX News Sunday With Chris Wallace":

CHRIS WALLACE: Let's start with the big picture. Five years later, where do we stand in the war on terror? Where do we stand in the conflict against Islamic extremism?

SECRETARY OF STATE CONDOLEEZA RICE: I think it's clear that we are safe — safer, but not really yet safe. And we've done a lot. In terms of homeland, we're more secure, our ports are more secure, our airports are more secure.

We have a much stronger intelligence-sharing operation, not just within the country, where we've broken down walls between law enforcement and intelligence agencies to get all of the information to break up terrorist plots, but also across the world. We have, really, an intelligence network across the world of sharing information.

We've clearly hurt badly the Al Qaeda organization that planned and plotted and executed Sept. 11, capturing many of their major field generals. When the president talked the other day about bringing to justice people like Abu Zubaydah, people like Khalid Sheik Mohammed, you're really talking about the people who were at the center of that kind of plot of 9/11.

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And, Chris, we are making progress for the long run, in having liberated 50 million people and then having new allies in the war on terror, like Afghanistan and, indeed, Iraq.

WALLACE: Any failures?

RICE: Well, certainly. I'm sure there are many things that could be done better. We would like to make more progress. People would always like to make more progress. But ...

WALLACE: But anything specifically that you say that, you know, five years later, the war on terror hasn't gone as well?

RICE: History will have to judge, Chris. I think that the record will show that the last five years have been years of reorganizing the United States government, reorganizing our international alliances for this long war, and reorienting our strategic policy toward one that simply will not accept the conditions in the Middle East and in other places that have allowed extremism to flourish at the expense of moderation.

WALLACE: All right. Let's talk about some of the concerns that people have. President Bush calls Iraq, and again this week called Iraq, a central front in the war on terror. But I want to look at some of the other statements made by your administration recently. And let's take a look.

In April, your State Department said, "Al Qaeda in Iraq has about 1,000 fighters. That's about 5 percent of the total insurgency."

Last month, the Pentagon said, "The core conflict in Iraq changed into a struggle between Sunni and Shia extremists seeking to control key areas of Baghdad."

Secretary Rice, what evidence do you have that the homegrown Sunnis and Shia fighting each other in Iraq — and, of course, that, at this point, is the vast majority of the violence — that they have any interest in attacking the U.S.?

RICE: Well, clearly, the person who set off much of this sectarian violence, who plotted the nation that Shias should go after Sunnis and you should try and spark civil conflict, actually was the Al Qaeda leader at the time, Zarqawi, who has...

WALLACE: But he's gone.

RICE: ... been killed.

Well, but it was his strategy — and we know that — to try and set off sectarian violence.

Now, we have to ask the question, why did he try to do that? Because he understood and Al Qaeda in Iraq understood that when there is a stable and democratic Iraq, then their plans, the plans of Al Qaeda and the extremists, for a Middle East in which there is indeed sectarian violence, in which there is extremism, in which there are repressive regimes of the Taliban type, that will not be possible when there's a democratic Iraq.

And so, yes, Iraq is going through very difficult times, there's no doubt about that. But if you have a broad view of what it will take to defeat extremism, meaning that there will have to be a different kind of environment in the Middle East, it's hard to imagine that different kind of environment with Saddam Hussein in power and Iraq at the center of a nexus between terrorism and conflict.

WALLACE: But I think here's the concern a lot of people have. When we went in there, allegedly to remove the weapons of mass destruction, people understood that as the war on terror. Even when we deposed Saddam Hussein, people understood that as the war on terror. When we were fighting Abu Musab al-Zarqawi, people understood that as the war on terror.

Now we've got Shiites fighting Sunnis, Muqtada al-Sadr — these are rivalries that go back centuries, tribal rivalries, religious rivalries. Aren't we involved in a terrible case of mission creep here that has nothing to do with the war on terror?

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RICE: Chris, it is the Iraqis who will have to settle their own differences. And, indeed, that's why they talk about a process of national reconciliation. That's why they're trying to build security forces that bridge sectarian divides.

Our role, though, was to indeed remove Saddam Hussein. And it's hard to imagine that the world could possibly have gotten better with Saddam Hussein in power, that the Middle East could possibly have gotten better. ...

WALLACE: Is it our responsibility to solve these ethnic, sectarian problems?

RICE: It is clearly Iraq's responsibility, Iraqis' responsibilities to do that. We ...

WALLACE: But we're involved in the fighting.

RICE: Well, but we have to give them an environment in which they can do that. We have to help them build security forces. We have to help them build political institutions.

And, Chris, it would simply be wrong to say that the only problem in Iraq is sectarian violence between Sunnis and Shia. There is still a considerable problem of terrorism from extremists who simply want to see Iraq be part of a Middle East in which the bin Ladens of the world control, not the Malikis, the moderates of the Middle East.

WALLACE: Meanwhile, there is Afghanistan, which used to be the safe haven for Al Qaeda and where some of its leaders are still at large.

On Friday, a suicide bomber — and we have the pictures here — attacked an American military convoy in Kabul, killing 16 people. The Taliban, which most Americans thought we wiped out back in 2001, is back on the march in the south. And NATO forces, this week, are asking for more troops.

Secretary Rice, why didn't we finish the job in Afghanistan?

RICE: Well, it was not possible, Chris, to, quote, "finish the job" in Afghanistan. This is going to be also a long process of bringing stability to Afghanistan.

We have made enormous progress over the last 4 1/2 years in Afghanistan. You actually have a national government that is elected in Afghanistan, whose forces are fighting alongside of us rather than the Taliban, which was both harboring Al Qaeda and giving them support. You now have for the people of Afghanistan the possibility of a better life. Women are not being beaten in stadiums that were given to the Taliban by the international community.

You have a situation in which, yes, the Taliban is trying to make a strike at the Afghan government because they do not want it to succeed. But the Taliban is not going to succeed. And they're not going to succeed because you have strong NATO and coalition forces and U.S. forces that are beating them back. The Taliban is taking a beating in this.

And, Chris, I want to be very clear. The notion that somehow this is a strategic threat to the Karzai government, I think this is not the case. You are talking about a Taliban that is able, particularly in the south, to wreak a lot of havoc and to bring death and destruction to civilians. But they are being beaten back.

WALLACE: But, again — and just this week, the head British commander in Afghanistan, Brigadier Ed Butler, said — and let's put it up on the screen — "The fighting is extraordinarily intense. The intensity and ferocity of the fighting is far greater than in Iraq on a daily basis."

I'm sure a lot of Americans are saying, isn't it a — we had them on the run. We had the Taliban completely disrupted. Isn't it a failure to have allowed the Taliban to regroup?

RICE: Well, now, Chris, it's very hard to say that we didn't expect them to fight back. Of course they're going to fight back. Even if they're on the ropes, they're going to fight back. And, yes, they came back somewhat more organized and somewhat more capable than people would've expected. But that's why they're being beaten back by the NATO forces that are there. I think they also believed that when the United States forces moved out and NATO moved in, that it would be easier to make advances. And they're learning a very brutal lesson, as they encounter NATO forces that are destroying them in very large numbers.

WALLACE: I don't have to tell you that one of the criticisms of the Bush administration — we heard it again today from Sen. Jay Rockefeller — is that all of you manipulated intelligence to push the country into war.

I want to discuss just one area, the issue of whether Iraq helped Al Qaeda with weapons of mass destruction.

Here's what the president said in October of 2002.

(BEGIN VIDEO CLIP)

BUSH: We've learned that Iraq has trained Al Qaeda members in bomb-making and poisons and deadly gases.

(END VIDEO CLIP)

WALLACE: And in March 2003, just before the invasion, you said, talking about Iraq, "and a very strong link to training Al Qaeda in chemical and biological techniques."

But, Secretary Rice, a Senate committee has just revealed that in February of 2002, months before the president spoke, more than a year, 13 months, before you spoke, that the Defense Intelligence Agency concluded this — and let's put it up on the screen.

"Iraq is unlikely to have provided bin Laden any useful CB" — that's chemical or biological — "knowledge or assistance."

Didn't you and the president ignore intelligence that contradicted your case?

RICE: What the president and I and other administration officials relied on — and you simply rely on the central intelligence. The director of central intelligence, George Tenet, gave that very testimony, that, in fact, there were ties going on between Al Qaeda and Saddam Hussein's regime going back for a decade. Indeed, the 9/11 Commission talked about contacts between the two.

We know that Zarqawi was running a poisons network in Iraq. We know that Zarqawi ordered the killing of an American diplomat in Jordan from Iraq. There were ties between Iraq and Al Qaeda.

Now, are we learning more now that we have access to people like Saddam Hussein's intelligence services? Of course we're going to learn more. But clearly ...

WALLACE: But, Secretary Rice, this report, if I may, this report wasn't now. This isn't after the fact. This was a Defense Intelligence Agency report in 2002.

Two questions: First of all, did you know about that report before you made your statement?

RICE: Chris, we relied on the reports of the National Intelligence Office, the NIO, and of the DCI. That's what the president and his central decision-makers rely on. There are ...

WALLACE: Did you know about this report?

RICE: ... intelligence reports and conflicting intelligence reports all the time. That's why we have an intelligence system that brings those together into a unified assessment by the intelligence community of what we're looking at.

That particular report I don't remember seeing. But there are often conflicting intelligence reports.

I just want to refer you, though, to the testimony of the DCI at the time about the activities. ...

WALLACE: That's the head of central intelligence.

RICE: Yes, head of central intelligence — that were going on between Al Qaeda and between Iraq.

But let me make a broader point. The notion, somehow — and I've heard this — the notion, somehow, that the world would be better off with Saddam Hussein still in power seems to me quite ludicrous.

Saddam Hussein had gone to war against his neighbors twice, causing more than a million deaths. He had dragged us into a war in 1991 because he invaded his neighbor Kuwait. We were still at war with him in 1998 when we used American forces to try and disable his weapons of mass destruction. We went to war again with him, day in and day out, as he shot at our aircraft trying to patrol no-fly zones. This was a mass murderer of more than 300,000 of his own people, using weapons of mass destruction.

The United States and a coalition of allies finally brought down one of the most brutal dictators in the Middle East and one of the most dangerous dictators in the Middle East, and we're better off for it.

WALLACE: We have about a minute left, and I want to get into one last area.

There have been several stories this week that you prevailed over Vice President Cheney in the debate over whether or not to pull these top, high-valued prisoners, like Zubaydah and Khalid Sheik Mohammed, out of the CIA prisons. Also, reports that you now have more clout with the president than Vice President Cheney because of mistakes in judgment he made in the first term.

Have you replaced ...

RICE: Oh, I think these are ...

WALLACE: ... the vice president?

RICE: These are truly among most of the ridiculous stories. These stories float around Washington — who's up, who's down.

The vice president remains a crucial adviser to the president. His role is different than my role. But not only is he a crucial adviser to the president, in whom the president relies, but he's also someone on whom all of us rely, including me, for advice and counsel because of his great experience and because of his great wisdom on these issues.

No, these stories are simply ridiculous.

WALLACE: You have not replaced the vice president as the president's top foreign policy adviser?

RICE: I'm the secretary of state, Chris. I have a different role from the vice president.

But let's remember who ultimately makes the decisions on foreign policy. It's the president of the United States himself.

WALLACE: We're going to have to leave it there. Secretary Rice, thanks for coming in. ...

RICE: Thank you.

WALLACE: ... and thanks for giving us your perspective on this fifth anniversary.

RICE: Thank you.

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