The following is a partial transcript of the Oct. 15, 2006, edition of "FOX News Sunday With Chris Wallace":

"FOX NEWS SUNDAY" HOST CHRIS WALLACE: I'm Chris Wallace. The U.N. acts against North Korea's nuclear program, next on "Fox News Sunday".

Nuclear saber rattling in North Korea, sectarian violence in Iraq, and then there's Iran. What does the U.S. do now? We'll ask the Democrats' once and possibly future presidential nominee Senator John Kerryand the secretary of state, Condoleezza Rice.

Plus, with three weeks till election day, can Republicans put controversy behind them and keep control of Congress? We'll poll our Sunday regulars, Brit Hume, Mara Liasson, Bill Kristol, and Juan Williams.

And our Power Player of the Week brings Hollywood to Washington, all right now on "FOX News Sunday".

And good morning again from FOX News in Washington. Let's start with a quick check of the latest headlines. North Korean officials reacted angrily to the unanimous U.N. Security Council vote Saturday that imposed financial and weapons sanctions on their country.

North Korea's U.N. ambassador called the action gangster-like and warned any more pressure from the U.S. would be a declaration of war.

In Iraq, signs that sectarian violence is getting worse. In separate incidents over the weekend, more than 60 people were killed. And in Baghdad, the U.S. military reports five American soldiers were killed Saturday. October is now on pace to be the deadliest month for American troops since January of 2005.

And joining us now is the secretary of state, Condoleezza Rice, who comes to us from the presidential retreat at Camp David.

Secretary Rice, welcome back to FOX News.

SECRETARY OF STATE CONDOLEEZZA RICE: Good morning. Nice to be with you, Chris.

WALLACE: Let's start with those sanctions that the U.N. Security Councilimposed yesterday on North Korea. The resolution bans trade in weapons and luxury goods, but it explicitly excludes the use of military force and it does not impose the kind of sweeping trade embargo that Japan wanted.

Question: Do you really believe that preventing Kim Jong Il from getting his cognac is going to stop his nuclear ambitions?

RICE: Well, this is a regime that very much likes luxury for itself while it starves its own people, and so I think it's probably gotten their attention. But there's really much more to this story, Chris.

China, which has never wanted to impose sanctions, particularly on a state with which it has close relations, Russia, the United States, Japan, and the entire international community have now imposed the toughest sanctions on North Korea that have ever been imposed, done it unanimously.

It will allow efforts to prevent proliferation in the weapons of mass destruction that Kim Jong Il is brandishing, and it sends a very strong signal to North Korea that it is now completely isolated.

It of course leaves open the possibility of returning to six- party talks and implementing the joint statement that was signed on September 19 of 2005, but this is (inaudible)...

WALLACE: But, Secretary Rice, China — and we're having some technical difficulties, but I'm going to press ahead while we continue to sort them out. I hope you can hear me.

China, which is North Korea's biggest trading partner and shares an 880-mile border with that country, has already said that it is not going to inspect cargo coming in or out of that country, which certainly leaves the possibility that the North Korean regime can still ship out nuclear material.

You're leaving Tuesday for a trip to the region where you're going to talk with North Korea's neighbors. Are you going to try to get them, especially China, to crack down?

RICE: I think you have to, again, Chris, go to where we are. This is remarkable unity of purpose and unity of message to North Korea. It is also the case that there are many details to be worked out, particularly about how this embargo and interdiction might work.

I understand that people are concerned about how it might work so that it doesn't enhance tensions in the region, and we're perfectly willing to have those conversations, but China signed on to this resolution. It voted for this resolution.

It is a Chapter 7 mandatory resolution, and so I'm quite certain that China is going to live up to its responsibilities. But you cannot underestimate how big a blow it is to North Korea to have all of the neighbors now, including what has been its strongest supporter, China, fully united behind sanctions against its nuclear program.

WALLACE: But to press the point, if I may, what do you make of China already saying that it does not intend to inspect cargo going in or out of North Korea?

RICE: Well, China is signed on to a resolution that pledges cooperation in stopping the proliferation trade with North Korea. And I'm quite certain that China has no interest in seeing the proliferation of dangerous materials from North Korea.

This is the toughest action that China has ever signed on to vis- a-vis North Korea, and I think when people say well, the United States should have done this bilaterally, you now see why it is important to have all states united.

There will be details to work out. There will be differences in emphases, but the North Koreans now face a united front that will not allow them to continue to pursue their nuclear programs without consequence, and that's an extremely important step.

WALLACE: Secretary Rice, is the U.S. prepared to go outside the U.N. to form another coalition of the willing to act on its own to interdict all shipments in or out of North Korea?

RICE: We are very satisfied with this resolution, and we believe now that this resolution should be fully implemented. It will take some work to talk about the implementation of the resolution. That's part of what I will do when I go out to the region on Tuesday.

We believe that there may be other steps that will be necessary given North Korea's behavior. But we are very satisfied with where we are right now, to get a 15-0 resolution that sanctions North Korea under Chapter 7, and I want to just underscore, a mandatory resolution that brands North Korea now a threat to international peace and security, requires North Korea to do some things, requires member states to do things...

RICE: For now, we are very pleased with where we are.

WALLACE: Listen, we're continuing to have some technical difficulties, Secretary Rice. We apologize. So why don't we take a break here? And when we come back, we'll continue our conversation with the secretary of state.

WALLACE: And with the hope that our technical problems are now solved, we go back to Camp Davidand the secretary of state.

Secretary Rice, I want to take you back to the president's state of the union speech in 2002 where he announced — listed the axis of evil and made this pledge. Take a look.

(BEGIN VIDEO CLIP)

BUSH: The United States of America will not permit the world's most dangerous regimes to threaten us with the world's most destructive weapons.

(END VIDEO CLIP)

WALLACE: Secretary Rice, since then, the U.S. has invaded Iraq, which turned out not to have any weapons of mass destruction, and meanwhile both Iran and North Korea have continued full speed ahead on their nuclear programs.

Hasn't the Bush administration failed to keep the promises pledged that day?

RICE: Chris, let's be accurate with the history here. First of all, everyone thought Iraq had weapons of mass destruction. One thing is certain now. Saddam Hussein's regime will never pursue them again in the way that they did throughout the '90s to the point that they actually used weapons of mass destruction against their neighbors. So Iraq is not a WMD threat.

When you look at Iran, Iran is now under international pressure to give up the early stages of the development of its nuclear program, its enrichment and reprocessing capability. It is a multilateral effort, not just a U.S. effort, and that is extremely important because the United States doesn't need to do this alone and can't do it alone.

Countries have to be committed to sustaining the non- proliferation regime, and with Iran we have six countries, the five permanent members of the Security Council plus Germany, that are pursuing that.

And with North Korea, which has been pursuing nuclear weapons for decades — this goes back probably to the late 1960s, certainly to the late 1970s and early '80s — you finally really have a coalition of states that are determined to keep the North Koreans from keeping their nuclear weapons program and progressing.

WALLACE: But, Secretary...

RICE: So this administration has done more than at any other time to make sure that there is really an international coalition to deal with these cases.

WALLACE: But, Secretary Rice, for whatever reasons and whatever the diplomacy, the fact is that compared to 2002 when the president made that speech, Iran has a more developed nuclear program than it had in 2002. North Korea has tested a long-range missile when the president said that would be unacceptable. It has now had a nuclear test.

Aren't two-thirds of the axis of evil more dangerous now than they were in 2002?

RICE: There is no way to suggest that having China, Russia, the entire international community finally unified around a plan, around a program to deal with the nuclear threat from North Korea is somehow less successful than where we were in 2002 when the North Koreans were pursuing a new path to nuclear weapons, where they were breaking out of bilateral agreements with the United States — where, by the way, just two years before that, they had, in fact, tested missiles.

No, it wasn't a good situation in 2002 — 2000, and they have continued to pursue their programs, but we finally have the right coalition of states to put enormous pressure on North Korea to reverse its course. We did not have that in 2002 when the president made that speech.

WALLACE: Well, let's talk about how effective diplomacy has been. You appeared on "FOX News Sunday" back on June 4th and I asked you how long Iran had to respond to an offer to end its nuclear program. Here's what you said at that time.

(BEGIN VIDEO CLIP)

RICE: I think it's fair to say that we really do have to have this settled over a matter of weeks, not months.

(END VIDEO CLIP)

WALLACE: Secretary Rice, it has now been 19 weeks, 3.5 full months, since those comments, and the fact is the United Nations has not imposed a single sanction on Iran.

So how effective is the diplomacy, and how much credibility does it give us when we threaten Iran and North Korea?

RICE: Chris, you skipped one step. In July, the United Nations made mandatory the Iranian suspension of its enrichment and reprocessing with a resolution, 1696, that was also 15-0.

We then decided to pursue an option to allow Javier Solana, the E.U. high commissioner for foreign policy, to see if he could find a way for Iran to agree to suspend its program so that we could begin diplomacy. We felt that that was worth it.

But it is now very clear that Iran is not going to take that course, and the work on sanctions has begun in capitals and will begin in the Security Council this week.

So we're moving right along here from February when the IAEA, the International Atomic Energy Agency, said it was not acceptable for Iran to enrich and reprocess, through a resolution in July, to a resolution now within, I think, a few weeks here that will begin to impose costs on Iran for its continued enriching and reprocessing.

And we've done all of that while having put forward a package of incentives that Iran could have taken up and could still take up...

RICE: ... its nuclear program. So the international community has achieved a lot. These are not easy matters to handle. But the United States is much better off working with its allies than trying to do this bilaterally and being isolated itself.

WALLACE: Secretary Rice, we continue to have some technical differences there at the end. We want to thank you. Whoops, I think she's gone. Thank you so much for appearing this week and safe travels on your trip overseas starting on Tuesday.