This is a partial transcript from "The O'Reilly Factor," October 17, 2006, that has been edited for clarity.

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BILL O'REILLY, HOST: Now for the top story tonight. My conversation with the president, beginning with the terror suspect controversy.

(BEGIN VIDEOTAPE)

O'REILLY: Today, you're signing the bill that overwhelmingly passed in the House and Senate that gives the Bush administration — and subsequent administrations — the military tribunal option in bringing suspected terrorists to justice. Your administration has been accused of being fascist, violating human rights, ignoring the Geneva Convention and it's been a fierce campaign against this policy. Why has it been so fierce?

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I don't know. That's what observers of our society like yourself can help figure out. I — you know, I — look, after 9/11, I vowed to protect this country. And when we pick up somebody on the battlefield, we want to know what that person knows. And we can find information without torturing that person. And we have found useful information necessary to protect the American people.

As you know, we picked up a fellow named Khalid Sheik Mohammed. Intelligence folks believe or suspect that he was a person that masterminded the 9/11 attacks.

I want to know what he knew in order to prevent another attack. Now maybe there are some in this country who say, well, they're not coming again. And therefore, all this is unnecessary.

I believe they are coming again. And I believe it is the responsibility of the federal government to protect our people. And, therefore, had a program in place that said we'll question these people.

O'REILLY: Now Brian Ross of ABC said — reported the CIA water boarded Mohammed. That is dunked him in water, tied him down and then that broke him. Is that true?

BUSH: We don't talk about techniques. And the reason we don't talk about techniques is because we don't want the enemy to be able to adjust. We're in a war.

O'REILLY: Is water boarding torture?

BUSH: I don't want to talk about techniques. And — but I do share the American people that we were within the law. And we don't torture. We — I've said all along to the American people we won't torture, but we need to be in a position where we can interrogate these people.

O'REILLY: But if the public doesn't know what torture is or is not, as defined by the Bush administration, how can the public make a decision on whether your policy is right or wrong?

BUSH: Well, one thing is that you can rest assured we're not going to talk about the techniques we use in a public forum. No matter how hard you try because I don't want the enemy to be able to adjust their tactics if we capture them on the battlefield.

But what the American people need to know is we've got a program in place that is able to get intelligence from these people. And we've used it to stop attacks.

The intelligence community believes strongly that the information we got from the detainee questioning program yielded information that made America safer, that we stopped attacks.

Secondly, the courts. Yes, I believe that it was necessary to have military tribunals because I ultimately want these people to be tried. And it took a while to get these tribunals in place.

The Supreme Court ruled that the president didn't have the authority to set up these courts on his own, that he needed to work with Congress to do so. And we did.

What's interesting about these votes that took place in the Congress is the number of Democrats that opposed questioning people we've picked up on the battlefield. And I think that's an issue that they're going to have to explain to the American people.

O'REILLY: What's wrong with civilian courts? What's wrong with doing what you did to Moussaoui?

BUSH: Because there's some — a lot of times there's intelligence involved that would, if exposed, would make it very difficult for us to beat the enemy, to prosecute this war. And the tribunal are people — are going to have — they're going to have lawyers. But it enables us to protect certain intelligence. And the American people understand that.

O'REILLY: Let me to read you what Hillary Clinton, who could be the nominee for presidency in 2008 on the Democratic side, said about this bill that you voted against, this detain decree bill you're signing today:

"If enacted, this law would give license to this administration to pick people up off the streets of the United States and hold them indefinitely without charges and without legal recourse."

BUSH: You mean pick the enemy up off the streets?

O'REILLY: She says people — "pick people up off the streets."

BUSH: I don't know who she's talking about. But this law will enable us to find people that with like to kill Americans. Al Qaeda, Al Qaeda affiliates and be able to find out their plans and be able — more protect this country. I have no idea who she's talking about.

O'REILLY: Do you think Hillary Clinton is soft on terrorism?

O'REILLY: I think — first of all it's very important for me never to, you know, question anybody's patriotism. I believe there's a group of people here in Washington, however, who have a different view of this war. They view it as a law enforcement matter.

I view it as war. And therefore the federal government must use all our assets at our disposal, obviously within the Constitution to protect this country.

We cannot afford to respond to an attack after it happens. We must be in a position to be able to gain the intelligence necessary to stop the attack from happening if in the first place. And that's why I thought it was important to listen to phone calls by Al Qaeda or Al Qaeda affiliates coming from outside the country in. And that's why it's important to be in position to be able to question these people we pick up off the battlefield.

Now there are some who say we're not at war. There are some who say Iraq is not part of the War on Terror. I strongly disagree. And so does Usama bin Laden, and Mr. Zawahiri, sworn enemies of the United States, who would like to attack us again. And that's the fundamental difference of attitude. I'm never going to question anybody's patriotism.

But I am going to say there's different point of view here in Washington, D.C. And the American people get — they got a choice to make coming this November. And I believe the choice is stark and clear. And believe that my party and our candidates are going to best put policies that — will be better positioned to put policies in place that enable us to protect the American people from an attack.

(END VIDEOTAPE)

O'REILLY: We'll have more with Mr. Bush in a moment, including why the Taliban is gaining strength again in Afghanistan.

(COMMERCIAL BREAK)

O'REILLY: Continuing now with "The Factor" exclusive, my conversation with President Bush. The War on Terror is being waged on many fronts, as you know, including Afghanistan, where the defeated Taliban is making a comeback. How could that happen?

(BEGIN VIDEOTAPE)

O'REILLY: The Taliban has obviously resurrected itself. Their sanctuaries are in Pakistan. You just recently had Musharraf here at the White House. Why can't Musharraf wipe these Taliban guys out?

BUSH: I had a very good discussion with both President Musharraf and President Karzai at the same dinner table. And one of the topics we discussed is how do deal with Taliban leaders who may be hiding in Pakistan. And the answer is good intelligence sharing. And President Musharraf made the commitment that upon good actionable intelligence, that he will take care of the leaders of the Taliban.

O'REILLY: Do you believe that? I mean, it's been years.

BUSH: Yes, I do. I do believe it.

O'REILLY: But he hasn't done anything for years.

BUSH: Well, it's not true. He's actually doing a lot. And…

O'REILLY: You don't think his army could go up and pacify those areas?

BUSH: I think it's much harder than you think. I think in order to find individuals in those areas, it's going to require good intelligence. He's been very effective on Al Qaeda. There's still more work to be done on Al Qaeda. And he understands it doesn't do this country any good to have extremists and radicals inside his country, fomenting violence, whether it be inside Pakistan or outside Pakistan.

O'REILLY: The Taliban is financed by poppy sales, heroin trafficking.

BUSH: Yes.

O'REILLY: Why doesn't the United States destroy those fields?

BUSH: We're working with the sovereign government of Afghanistan to do just that. They went with a strategy that was pretty effective in some provinces, not very effective in Helmand Province, for example.

I spoke to President Karzai about this. I said look, it doesn't make sense for us to be trying to help your democracy succeed and you have got major poppy growers growing. And so they've got a new eradication program that he's going to try out this upcoming year.

O'REILLY: Again, you know, it's year after year and we don't see a lot of results here.

BUSH: Well, actually…

O'REILLY: The air base at…

BUSH: No, I know, I know, I know, I know. But some provinces they actually made very good progress in, but not this one. And — in other words, one province really led the way in terms of poppy — increased poppy cultivation. And we just got to deal with it.

O'REILLY: All right. I think the bottom line is this crazy insurgency on the Islamofascists, as I call them, it's never going to end in our lifetime?

BUSH: Well, I think that's an interesting question, an interesting point. The question is how do you marginalize them?

O'REILLY: Right, how do you control them?

BUSH: I think this is the big ideological debate of the 21st century. And that is extremists, Islamofascists as you call them, radicals aiming to topple modern people. And it is a massive challenge for the free world and for Muslims who cannot — who want to leave in peace. By far, the vast majority of people want to have a peaceful existence.

O'REILLY: But they're scared…

(CROSSTALK)

BUSH: Yes, they're scared.

O'REILLY: They will kill you and your family and every kid you have.

BUSH: In a minute. And that fundamentally asks — that means what's the U.S. role? Not only will they kill their families. They'll come and kill us.

The biggest issue we face for this country is how do you protect yourself? And our strategy is twofold: One, get on the offense and stay on the offense and bring them to justice. When we find them, bring them to justice.

And secondly, defeat their ideology by helping moderate people, particularly in the Middle East, to come up with competing systems that actually speak to people's hopes and aspirations.

And I've been widely criticized for promoting liberty, but I believe it works as an antidote to the dark visions of these radicals. And I know this, if the United States becomes isolationist and pulls out, a generation of those people will say, they lost their way. They forgot what caused America to be created in the first place. They lost their faith in liberty.

O'REILLY: But in the back of your mind, there must be some Muslims want Sharia. They don't democracy.

BUSH: Yes.

O'REILLY: They want to be in a theocracy. They want to be told what to do.

BUSH: Some do, but it's a small number compared to the vast majority of people who just want a peaceful way. They want to be able to practice their religion.

See, this is not a struggle of religion, in my judgment. This isn't Christianity versus Islam. People in the Muslim world need to look at the United States. We welcome Muslim-Americans. They're free to worship the way they so choose.

This is a struggle between people who have subverted a great religion to meet their own ambitions and kill. I don't believe religious people kill innocent people. I don't believe that.

I believe these are totalitarians who want to impose their vision on others. And they use murder as a weapon to achieve it. And the fundamental question facing all civilized world and facing nations in the Middle East is can we have systems in place that end up marginalizing radicals and extremists. It's really the call of this generation, Bill.

O'REILLY: Brutal.

BUSH: Well, it's brutal, but it's necessary.

O'REILLY: But it is brutal.

BUSH: It is necessary.

O'REILLY: Absolutely.

BUSH: And I clearly see the problem. And look, I understand there's a lot of second guessing because I'm asking the American people to — and our military and intelligence services — to do hard work. But I believe it's necessary work now so a generation doesn't have to deal with it in a much more violent form.

(END VIDEOTAPE)

O'REILLY: Now tomorrow, we'll talk with President Bush about the personal attacks leveled against him and the fact that many people think he's a religious fanatic. Extremely interesting segment. And we hope you'll be here.

Click here to read Part 1 of Bill O'Reilly's Exclusive Interview with President Bush

Click here to read Part 3 of Bill O'Reilly's Exclusive Interview with President Bush

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