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Transcript: Fran Townsend on 'FOX News Sunday'

The following is a partial transcript of the Sept. 9, 2007, edition of "FOX News Sunday With Chris Wallace":

"FOX NEWS SUNDAY" HOST CHRIS WALLACE: With us now to discuss that new tape from Osama bin Laden and an overview of the war on terror is Fran Townsend, the president's homeland security adviser.

And welcome back to "FOX News Sunday."

WHITE HOUSE HOMELAND SECURITY ADVISER FRANCES FRAGOS TOWNSEND: Good to be with you.

WALLACE: Let's start with the videotape. I know U.S. intelligence is studying it very closely, frame by frame. One, is it Usama bin Laden? And two, any clues as to when he made it?

TOWNSEND: Well, for sure, the intelligence community, having looked at it, believes it is bin Laden. The indications from the contents of the tape are that it was made recently, certainly in the last several months.

WALLACE: What about his appearance? Is the beard — can you tell whether it's real or fake, which would indicate, if it is fake, that he's then going around Pakistan clean shaven?

And can you tell anything about his health or the wear and tear on him from looking at the tape?

TOWNSEND: Chris, these are all the sorts of things that the intelligence community will do a technical analysis to evaluate. Obviously, we're still going through that now.

But looking at issues related to his health, his whereabouts and, frankly, the content of the tape, to make sure that this is not a trigger for an attack — these are things that the intelligence community is completely devoted to as we speak.

WALLACE: And do you have any answers?

TOWNSEND: No. I mean, we will obviously action any information that we find from that. But as you can understand, the particulars of the technical analysis are not something we're going to reveal.

WALLACE: But let me ask you about the contents of this. Any hidden threats that you can see so far or any clues that it could be a trigger to his supporters out in the field to act? And just more generally, what is he trying to accomplish here?

TOWNSEND: Well, based on our experience, Chris, we haven't seen to date the use of an audio or videotape as a trigger for an attack, so we start from that premise.

There's nothing overtly obvious in the tape that would suggest that this is a trigger for an attack. Let's remember almost six years now since September the 11th, we have not seen much of bin Laden.

Remember, the last audiotape was in June of '06. The last video was just before the election in October of '04. This is about the best he can do. This is a man on the run from a cave who is virtually impotent other than these tapes.

WALLACE: And so what do you think he's trying to do with this tape, basically say to the world, "I'm still here, I'm..."

TOWNSEND: That's right. I mean, we have been, by a variety of measures, whether it's our operations overseas, our defensive measures here at home, successfully disrupt or avoided another attack.

We take the tapes seriously. Look at the activities recently in Germany and Denmark. So we know that Al Qaida is still determined to attack, and we take it seriously. But this tape looks — appears to be nothing more than threats. It's propaganda on their part.

WALLACE: As we reach, on Tuesday, the sixth anniversary of 9/11, let's take a kind of overview look at where we stand on the war on terror. This week, CIA Director Hayden gave this chilling assessment. Let's take a look.

(BEGIN VIDEO CLIP)

CIA DIRECTOR MICHAEL HAYDEN: Our analysts assess with high confidence that Al Qaida's central leadership is planning high-impact plots against the American homeland.

(END VIDEO CLIP)

WALLACE: So the intent is still there. What about Al Qaeda's operational capability to carry off an attack?

TOWNSEND: Well, the national intelligence estimate that Director Hayden was referring to says that they've regained some of their capability. They have regained some of their operational leadership. We do still have Usama bin Laden and Zawahiri at large.

What they haven't seemed to be able to do is find a way to get the operatives inside the United States. The estimate, the intelligence estimate, makes clear Al Qaeda views the United States as a more difficult target to attack.

And frankly, that's the result of the efforts of thousands of public servants who work very hard every day to stop the next attack.

WALLACE: Do you — and I don't know if you have hard evidence one way or the other, but do you believe that Al Qaeda has cells of operatives currently operating in this country?

TOWNSEND: Obviously, that is the number one priority for action by the FBI as well as the rest of our intelligence community.

To the extent we identify any possibility of that sort of activity, we investigate it and we disrupt it. We either arrest people, we deport them, but we take action against it.

I'm not going to talk about ongoing investigations, but obviously, this is the number one priority.

WALLACE: But do you believe that they have cells here?

TOWNSEND: I believe that they've tried. I believe they're trying. We look every day to see if there are connections between Al Qaeda operatives overseas and here in the United States, and that's the sort of thing we work with our allies like our German counterparts, like our Danish counterparts, to make sure to look for connections.

WALLACE: Democratic presidential candidate John Edwards says that the war on terror is a bumper sticker. And this week he said we're actually less safe than we were before 9/11. Let's watch.

(BEGIN VIDEO CLIP)

FORMER U.S. SENATOR JOHN EDWARDS: Are we any closer to getting rid of terrorism than we were six years ago? And the answer to that is no. In fact, we're further away.

(END VIDEO CLIP)

WALLACE: Is Senator Edwards right?

TOWNSEND: I think Senator Edwards' comments are irresponsible and, frankly, unwarranted, unsupported by the facts.

We've been nearly six years now without another attack because we're safer than we were prior to September the 11th. Is there more we need to do? Absolutely. And we continue to take action to strengthen our country's defenses every single day.

But to suggest that we are not safer than we were six years ago and haven't made progress is just irresponsible and not supported by the facts.

WALLACE: But the chair and the vice chair of the 9/11 commission are out with an article this morning where they say that we're still not safe enough. And let's take a look at their comments.

"No conflict drains more time, attention, blood, treasure and support from our worldwide counterterrorism efforts than the war in Iraq. It has become a powerful recruiting and training tool for Al Qaeda."

And on the domestic front, they say, "We have become distracted and complacent." Ms. Townsend, your response.

TOWNSEND: There is no question that the war in Iraq is used as a propaganda tool by our enemies. But our enemies have also said that it's critical to them to win that battle.

There is no question that Al Qaeda in Pakistan, in the federally administrated tribal areas, Al Qaeda operatives in the Taliban in Afghanistan are connected to Al Qaeda in Iraq. We take those threats very seriously.

Do they use images from the battlefield as recruiting tools? Absolutely, as enemies have historically in wars and conflicts. It is not a distraction. It is an integral part of the war effort.

And we know that because we know from Al Qaeda — intelligence that we've declassified that bin Laden watches and cares about what happens in Iraq, and he's tasked them to undertake external operations.

WALLACE: But on the domestic front, the 9/11 commissioners are saying that our efforts to try to prevent terrorism lack urgency.

And in fact, you had a report this week by the inspector general of the Department of Homeland Security who talked about the fact that government programs to keep bombs out of the cargo holds of airplanes are full of holes.

TOWNSEND: We have taken a number of measures — Chris, when we talk about the progress that we've made, there's no question that that progress, the progress we've made to secure this country, is what's responsible for stopping the next attack.

Does that not mean — the president has said it — we're safer but not yet safe? There are additional measures that we need to take, and we work at that every single day, but that's not to suggest that we haven't made progress.

WALLACE: Let's talk about another aspect of the war on terror, and that is the fight in this country over civil liberties versus security.

This week a federal judge struck down part of the Patriot Act, saying that it was unconstitutional. You've got congressional Democrats who are already talking about taking back some of the powers that were given to you in the rewrite of the Foreign Intelligence Surveillance Act this summer.

Are the courts and Congress making it tougher for you and others in the administration to do your job fighting the war on terror?

TOWNSEND: I will tell you this — and Director Hayden, in his speech, part of the speech that you didn't show, referred to it feeling like September the 10th.

Congress and our overseers cannot walk back the vital tools that we need. The Foreign Intelligence Surveillance Act reforms that we got in August — they're temporary, and they expire in February. We need those tools.

The inspector general for the Department of Justice, when they issued a report on the national security letters and the use of the Patriot Act, made the point that the Patriot Act provides vital tools. We need those tools to continue to win the war on terror.

And so we need FISA reform made permanent. We need the national security letters. We need the Patriot Act. We need all those tools.

WALLACE: So what do you think, trying so hard to keep America safe, when you've got the courts — and here's a judge in New York who has twice now said that the same provision is unconstitutional — and you've got the Congress talking about walking these things back?

TOWNSEND: Well, in terms of the court's decision, the Justice Department is looking at that and evaluating what their options are to appeal such a decision.

And when it comes to FISA, we need Congress in this session to extend and make permanent the reforms to FISA. You know, when we had those conversations in August, we've made compromises and we addressed the FISA reforms to the most critical gaps that we had. But we need it made permanent.

WALLACE: Let me just ask you — and we've got less than a minute left. There's a story in the New York Times today that says that the FBI until recently — they've stopped the program — was surveilling the calls not only of Americans who were suspected of being terrorists but also all these communications of anybody they spoke to.

There's talk now about giving domestic law enforcement access to spy technology, finding more ways to surveille phone calls and e- mails.

The argument from civil libertarians is that you're spying on us, that you're removing our civil liberties. How do you respond to that?

TOWNSEND: You know, we now have a privacy and civil liberties officer in every single federal department. The FBI voluntarily suspended that program. But all it is is taking legally acquired data and applying analytic tools to it. They suspended it.

But it has been used to disrupt in the past terrorist plots. It's a tool that we don't use very often, but it's a tool that we need.

And they've put in — the director of the FBI has created a compliance unit, and he has his department looking at the use of that tool to ensure privacy and civil liberties while giving us the benefits of the tool.

WALLACE: Ms. Townsend, we're going to have to leave it there. We want to thank you so much for sharing your Sunday with us and talking with us today.

TOWNSEND: Thank you.