The following is a partial transcript of the Dec. 31, 2006, edition of "FOX News Sunday With Chris Wallace":

"FOX NEWS SUNDAY" HOST CHRIS WALLACE: Joining us now to discuss the situation in Iraq and what it means for U.S. policy is Senator Richard Lugar, the Republicans' top man on the Foreign Relations Committee.

And, Senator, welcome back to "FOX News Sunday."

SEN. RICHARD LUGAR, R-IND.: Thank you very much, Chris.

WALLACE: What is the significance of Saddam Hussein's execution? Is there a way to make this a turning point for Iraq?

LUGAR: It appears that much of Iraq was impressed by the fact that the trial occurred, although it was a first trial and later trials were coming and some Kurds, for example, felt that all the problems, the atrocities against them and against others in the country had not been revealed.

But, same time, ultimately, after the cheering in the streets or the curses, not much change; feeling that this all occurred three years ago and has played its way out.

WALLACE: Given that this is clearly a final statement to Saddam loyalists, the so-called dead-enders, that he really is not coming back, how important is it now for the Shiite government to take concrete steps to reach out to the Sunnis and try to bring them into the political process — real, national reconciliation?

LUGAR: Tremendously important. And the political side of this really has to be overemphasized all the time — that is, how the constitution can have amendments so that, as Iraq divides up into various local governments — Shiites and Sunnis and Kurds — which they're allowed to do, that this does not lead to the Sunnis feeling being left out.

Ditto with the oil distribution. To his credit, Prime Minister Maliki has started the conversation on the oil; likewise, on the devolution of the country.

But the Sunnis believe that the central government has to be reasonably important or they won't get their share of the oil and they won't get their share of the governance. So the reaching out and the success of the reaching out are of the essence.

WALLACE: How much confidence do you have that Prime Minister Maliki and his ruling coalition, all of those other Shiite parties, are capable and willing of taking the steps necessary to have this real national reconciliation?

LUGAR: I have very limited confidence, despite the effects of our ambassador, Dr. Khalilzad, who I think has done a tremendous job trying to push this.

This is one of the facets of the Baker-Hamilton commission that needs to be taken seriously, the so-called contact group of the nations surrounding. A lot has been made about negotiations with Syria and Iran, but equally important are contributions by the Jordanians, by the Saudis, by the Turks, for that matter. In other words...

WALLACE: But as for Maliki himself?

LUGAR: Well, we have to at least bring pressure in addition to whatever our ambassador is saying to him. In other words, some people in our country are saying, "Give Maliki three months, six months. If he doesn't make it, why, school's out, we come home."

But that's unlikely to really get the job done. Maliki is under great pressure within the Shiite community — the militias of the young Sadr, for example. And so we can offer all sorts of advice: make sure that militia disappears. Somehow or other, get the oil money divided correctly. And that's a tough job given the players that he's got there.

So what I'm suggesting is that the diplomatic aspects — that is, our diplomacy plus everybody else who has a stake in an Iraq that works, and maybe a greater stake sometimes than some of the Iraqis who keep asking, "Is there really an Iraq, as opposed to a situation of three different groups?"

WALLACE: Would you bring Syria and Iran into that conversation?

LUGAR: Yes, of course. They're neighbors. But I think that's why it's important to have the Saudis, the Jordanians, the Turks, others in the conversation, and including ourselves. It's not like anybody has veto power on the situation. It's just that everybody else sizes up what the others are doing, so there are not mistakes.

For example, the suggestion has been made, if we were to abruptly withdraw, the Saudis might be impelled to come in on behalf of the Sunnis. Well, the Syrians, perhaps, although they have a minority Shiite government, conflicted in itself — in other words, this is a very complex situation.

And what we have to be thinking of is stability in the region, where our forces, both diplomatic and military, can be placed to try to hold the region together.

WALLACE: Senator, let's talk about what the U.S. does next. It seems pretty clear that President Bush is leaning toward some kind of surge, of sending additional U.S. forces into Iraq.

Do you support sending in more troops?

LUGAR: Well, I don't know whether I do or not. And I say that because my prayer is that President Bush will take the advice that has come frequently, and that is with people being there on the takeoff, they have to support you on the landing.

Now, in the past, the administration has been inclined not to disregard Congress but to not take Congress very seriously. I think this time Congress has to be taken seriously. There's been an election; Republicans lost the election. There's going to be a change in leadership in my committee and likewise on the House side.

What I would advise would be maybe a retreat — it could be right here in Washington — but for several hours, in which the Foreign Relations Committee, just to take our group, really studies what is the president's plan, understands specifically who is to be trained, how would the politics affect what we've just been talking about, the devolution of the country, the oil money or anything else, the contact group.

In other words, that there be at least some study of this by all of this before, suddenly, we are all asked to comment, "Are you in favor of surge? Are you in favor of withdrawal? Six months? Three months?" — all the cliches. These are not going to be relevant.

WALLACE: But you're saying do this before the president addresses the nation.

LUGAR: Yes, that would be advisable, so that...

WALLACE: And what if he doesn't do that? What if, basically, you know, he calls a group of you in, has the meeting around the Cabinet Room...

LUGAR: Which is the usual course.

WALLACE: Yes. Then what?

LUGAR: Then he can anticipate, not endless hearings, but a lot of hearings, a lot of study, a lot of criticism. In other words, as opposed to having a Foreign Relations Committee that really now is well-informed, understands, may not agree but understands how you get from place to place, we have an assortment of invitations, demands for subpoenas, all sorts of situations in which administration figures perhaps reluctantly come to the committee or don't come to the committee or various other experts discuss...

WALLACE: You're saying this could get ugly.

LUGAR: Yes, it could. And it need not.

You know, I wrote just one book, "Letters to the Next President" — this was before the president's father came in — and suggested precisely this: You need to have as many allies as you can co-opted. Co-opt the leadership of the Congress before you act. And if you do, you're likely to have some reverses, but you may have some friends who will help you really throughout that process.

WALLACE: But let me pursue this, Senator. General John Abizaid, the commander of all U.S. forces in the Middle East, testified just last month before the Senate Armed Services Committee. He said that he had asked every divisional commander in Iraq whether it would help to have more forces sent in. This was just last month. And they all said no. Let's watch.

(BEGIN VIDEO CLIP)

GEN. JOHN ABIZAID: I believe that more American forces prevent the Iraqis from doing more, from taking more responsibility for their own future.

(END VIDEO CLIP)

WALLACE: How do you feel about the fact that it appears the president is now prepared to go against his commanders on the ground in Iraq?

LUGAR: Well, this is why I won't get into hypotheticals — what the president's prepared to do, what he's reported to do. Senators have already advised the president to do this or that or so forth.

What I'm hopeful the president will do is to lay out a plan before congressional leadership to get some understanding of what is involved. Because I'd like to know precisely, if we have more people and they're going to train other people, who's going to be trained? Will this be a national police as opposed to militias or local people who turn into militias?

In other words, is the very surge that's being suggested — and that involves a lot of training of Iraqis — likely to lead to Iraqis who are better prepared for civil war against each other?

We really have to begin tracing this carefully. It's not a question of more people. It's what specifically these people would do, what kind of training our people have to deal with the Iraqi political situation.

WALLACE: Well, you keep talking primarily about training. There's a lot of talk that what the administration is talking about is more combat troops...

LUGAR: Yes.

WALLACE: ... not for training, but to settle the security situation on the ground.

LUGAR: All right, very good. Now, then the administration needs to identify precisely where the battle lines are, who is it we combat. I haven't seen any such lines.

The Iraqi casualties each day are bombs in cars or roadside bombs. Now, we are getting much better at getting rid of those. Although the car bombs that killed the Iraqi civilians each day are at random. Conceivably, if you had many more people, you could go house by house, interview everybody, rout out, one by one, persons. But this is a very different kind of situation with this kind of insurgency.

WALLACE: Are there any circumstances under which you could support a surge? If it was primarily for increased combat? Are there some questions that could be answered to your satisfaction?

LUGAR: Well, if the military people or the president are able to describe to me who it is that we're going to be combating and physically how you find them.

Now, I understand that there are probably some Al Qaida terrorists, there are probably some old friends of Saddam, individual persons or maybe cell groups. But specifically, how are these persons found? How is this combat to be conducted? And what kind of personnel are required?

It would appear to be much more of an intelligence feature. It might require many more people who have the language skills and some idea of the mores of the people that they're dealing with.

WALLACE: We've got less than a minute left. There are a bunch of polls out over the last few weeks that show basically somewhere between 12 and 18 percent of the public supports the idea of sending more troops in. Here you can see: the Los Angeles Times, 12 percent; the Washington Times, 17; CBS News, 18 percent.

From your long experience in Washington, can a country sustain a war policy when there is so little public support for it?

LUGAR: Not very long. This is why I get back to the thought that the president needs some well-informed friends. He really needs to make certain some of us have some idea what the plan is, as opposed to suddenly saying, "Here is the plan, and, by golly, we're going to win," or some such verbiage of this sort. Those figures we just saw will go down even further.

If they're going to go up, they have to be because there are strong advocates that our country is on the right course. And even if there are people who differ, the hearings then in Foreign Relations become well-informed, sophisticated situations, rather than a lynching party.

WALLACE: And you think there's the possibility of a lynching party?

LUGAR: Well, not exactly. It won't be that bad. Senator Biden is a good friend...

WALLACE: He's already against it.

LUGAR: ... and we're going to have, however, four Democratic presidential candidates on the Democratic side there, and this is a season that you've already described.

WALLACE: Senator Lugar, we're going to see whether or not the president takes your advice over the course of the next couple of weeks. Thank you so much for joining us.

LUGAR: Thank you, Chris.

WALLACE: And Happy New Year, sir.

LUGAR: The same to you.