This is a rush transcript of "Special Report With Bret Baier" from September 28, 2009. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: This is an important day and an important week for the Iranians. They have decisions to make.

I think we are in a position to address the Iranian nuclear program if the Iranians are unwilling to live up to their obligations unlike we have ever been before.

(END VIDEO CLIP)

BAIER: The White House called it "provocative," Iran firing off medium-range Shahab-3 missiles like this one, capability of reaching 1,200 miles, putting Israel, also U.S. military bases in the Middle East and parts of Europe, within striking distance.

Reaction from the international community came quick. Russia, however, urged restraint, the foreign minister, Sergei Lavrov, saying "It is worrisome, of course, when missile launches happen against the backdrop of unresolved situations concerning Iran's nuclear program. I am convinced, however, restraint is needed." What about the response to all of this, and the backdrop, also, of new talks between the U.S. and Iran starting this Thursday?

Let's bring in our panel. Steve Hayes, senior writer for the Weekly Standard, Juan Williams, news analyst for National Public Radio, and Byron York, chief political correspondent of "The Washington Examiner." Steve?

STEVE HAYES, SENIOR WRITER, THE WEEKLY STANDARD: I think we heard the problem with the Obama administration's approach to Iran in the comment that we just heard from Robert Gibbs. He says "Iran has a decision to make."

I think that is fundamentally an error. The problem is Iran has made the decision. We keep pretending that Iran hasn't made the decision. They want a nuclear weapons program. We also contend that -- the Obama administration treats Iran and the Iranian regime as an unknown at this point, as if with the right kinds of persuasion, the right kinds of discussions Iran can be brought around.

We need to understand and talk realistically about what Iran is doing right now. They have secret enrichment facilities. They basically rejected or scoffed at every outreach that the Obama administration has made, and, I think, most fundamentally, they continue to kill American soldiers in Iraq and Afghanistan.

That's a regime that has pretty well made its decision up about how it wants to be treated by the international community, what it wants its relationship to be with the United States, and what it is doing on nuclear weapons.

BAIER: Juan, this missile test today, is that more of a galvanizing force for the international community?

JUAN WILLIAMS, NEWS ANALYST, NATIONAL PUBLIC RADIO: It is. I think that...

BAIER: Despite hearing what Russia had to say?

WILLIAMS: Right. Well, actually, I interpret notion of restraint as something that applies to the Iranians. But I understand how you could have interpreted it as applying to the international community.

But I think we have seen some progress, and Secretary of State Hillary Clinton has said she believes the Russians now have a different attitude towards the Iranians based on the events in the last few weeks.

But I think the key here is that the Iranians are not to be taken seriously. I agree with Steve, and the reason -- Steve, I would add your billet of complaints. They fund terrorists. They fund Hezbollah and they fund Hamas. They are contributing to the de-stabilization of the Middle East at this time.

So, to my mind, the Thursday talks are not about making peace with the Iranians. It's about building up an international consensus that will allow people to take action, because, it seems to me, the clock is ticking. Israel is going to take action shortly. And if Israel takes action, then what is the U.S. response?

And I think that then becomes a world issue, and that's why we need the world in some consensus that Iran is deserving of this action.

BAIER: What is your definition of shortly?

ROBERTS: I'm not a pro on that one. You have to go to the foreign policy guys.

(LAUGHTER)

BAIER: Byron.

BYRON YORK, CHIEF POLITICS CORRESPONDENT, "THE WASHINGTON EXAMIER": He punted on that.

The question is what will the United States and the allies do in the meantime before Israel's takes any sort of action? And first of all, we know that Iran has not been phased, not been chastened by anything they have done. I mean, nothing that has been done to this point has mattered. They haven't stopped.

The next question is if you don't go to a military attack before doing other things ahead of that. And the other question is what kind of sanctions might actually have some bite. Even if you don't believe they work, you have to do them.

And are there sanctions on shipping of gasoline or banking that could work even if the Chinese and Russians weren't onboard with them? Are there things that the U.S. and allies could do that could make a difference, and even if they don't make a difference, you have to do them before you take more drastic action.

BAIER: Steve, there are several lawmakers, including Pete Hoekstra from Michigan, who say these talks on Thursday really shouldn't go forward, because we have seen what the Iranians are doing. We have busted them with this facility that they have just announced at the G-20, and now the missile test.

What about sitting down with Iran now in this environment?

HAYES: Well, I wouldn't have sat down with them anyway, but I think certainly in light of what we found out, the public found out, which the Obama administration has known now since at least December of this secret enrichment facility, sitting down with them now rather than trying to immediately impose sanctions, pulling away from the talks, backing off and saying, look, I have reached out again and again and again. I have done everything there was to do to engage you, to give you this path.

The White House talks about these two paths, one that leads it back to the international community, and one that leads it into a state of isolation, an international pariah.

Again, Iran has made the decision. We know which path they're on. And to pretend that they're not on this path, that we could actually convince them by talking or some sanctions to return to the correct path I think is fooling ourselves, and dangerously so.

BAIER: Is there some hope inside the administration for these talks on Thursday, or is it a foregone conclusion that they are essentially going to get nothing on Thursday?

WILLIAMS: I think they don't know what they are going to get. It is possible that you would get from Iran understanding that they are now in a poor bargaining posture, that they would grant access to the International Atomic Energy folks who want to come in, that they would pledge to stop their program.

But there is no reason to give that any credibility. There is no reason to believe them.

So I think the position here is a little different than the framework you guys have been engaged in discussion about. The framework is get an international coalition, get the Russians onboard. The Russians don't want to be isolated. They don't want in there U.S. dominating that region.

We already have a strong footprint in Iraq, in Kuwait, so they don't want that. The Russians have a reason now to get onboard, and the comments we heard today would suggest that the whole dynamic has shifted within the last two weeks.

BAIER: And Byron, the missile launch obviously adds another layer to all of this. We know what Russia is saying publicly. China has not really stepped up in this whole discussion yet either.

YORK: Well, there's two things you do want when you want to build a nuclear weapons program. You have to have the weapon itself and a way to deliver it. So the missiles are that. Now, they're not near the point of having a nuclear warhead that they can put on a missile and deliver somewhere.

The missile tests do raise another possibility which we haven't talked about, which is delivering conventional warheads to Israel or a lot of American bases in the area, which could be another problem which if Iran has these missiles and can reliably shoot them 1,200 miles, that's a whole new factor.

BAIER: President Obama heads to Copenhagen this week to try to get the Olympics for Chicago. So, is this a sure thing, a political risk? What's the deal with this trip? We'll talk about it next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GIBBS: I think the president believes health care is in better shape. I believe he felt strongly and personally that he should go and make the case for the United States, and that's what he's going to be.

QUESTION: And he's not as worried about health care as he seemed to be just 12 days ago, suffering (ph) as he went?

GIBBS: I think he believes he can do this and get back in time.

(END VIDEO CLIP)

BAIER: Well, president Obama will leave this week for Denmark where he will lead a U.S. delegation, including the first lady and Oprah Winfrey, to try to rally the international community in an effort to land the 2016 Summer Olympics for Chicago. What about this trip and its announcement today? We're back with the panel -- Byron?

YORK: Imagine this Republican commercial -- Iran is -- the crisis growing, Afghanistan, the crisis is growing. We learn that Obama has spoken only one time with General Stanley McChrystal, the top commander in Afghanistan. He spent more time with David letterman than with Stanley McChrystal.

And amidst all this, the president is playing golf, going on vacation, going on "Letterman," doing the five shows, and now jetting off with Oprah to Copenhagen to try to get the Olympics for his hometown.

It's a question of where the president's priorities are right at this moment, and this trip, even though it is quick, going on Thursday, coming back on Friday, just doesn't seem like the right thing to do.

BAIER: Juan?

WILLIAMS: Come on. You are just picking on this guy.

Look, this is an effort to be a home time town guy from Chicago. He's from Chicago, this is about the home town. The mayor is going to be there, Oprah, Valerie Jarrett, his top adviser, another long time Chicago political player. Mayor Daley is going to be indebted to him. He is taking David Robinson, the Olympic star, Bart Conner, another Olympic star. It's a big effort to just fly the flag.

And I don't think it's much more than that. Go have some fun. I don't think there's anything wrong with it. I'm surprised to hear Mr. Gibbs say he thinks health care is under control, but maybe they know something that I don't know.

BAIER: But Juan, go have some fun with it? I mean, he hasn't made any decision on sending troop surges in Afghanistan.

WILLIAMS: I don't think it's going to get in the way. As Byron said, I think he leaves Thursday afternoon and gets back Friday afternoon. He has Air Force One. It's not like me running down and trying to catch the shuttle.

BAIER: Also, we wanted to do the calculation, but couldn't really do it quick enough for the carbon footprint that is heading to Copenhagen for Air Force One.

(LAUGHTER)

WILLIAMS: If you guys want to stick it to him, use that.

BAIER: We don't know if he will head to the climate change conference in Copenhagen, but he's heading there for the Olympics.

HAYES: Juan, I think most Americans would like Chicago to get the Olympics. As a Milwaukee native, we consider Chicago our greatest suburb.

But I think the real problem here is one of priorities, as Byron said. It is rather stunning that the president hasn't met in person with Stanley McChrystal yet.

This is the war -- it is not any war. It is the war that he campaigned on as the good war dating back as far back as 2002. And he said a couple weeks ago in his question and answer session I believe with Steven Harper from Canada that he doesn't want to rush this decision. He wants to take his time to get it right.

But that seems to me a bogus excuse. He has been campaigning on it as the right war. He has done his own strategic policy review. McChrystal has done a strategic assessment.

It is now time for the president to make a decision and act on the decision. I think this looks like a distraction. And even if you say he is going to spend all this time on the plane studying Afghanistan, the optics of it at the very least are terrible.

BAIER: Optics, don't you agree with that?

WILLIAMS: No. I just think most people look at this and say if he wants to go make a pitch for the Olympics, that's what the president should do, especially for his hometown, go do it.

When he put General McChrystal, this is not and an antsy McChrystal guy. This is a guy that is working. In fact, Admiral Mullen --

(CROSSTALK)

HAYES: In 70 days he talked to him once, and that was by video teleconference. I think that is a stunning affront to your lead commander in what you call the good war.

WILLIAMS: I don't think General McChrystal has been ignored or feels ignored in any way. And as I said, the chairman of the Joint Chiefs was just there last week to see him personally, and the report is there at the White House. Give the president time.

But as far as this Olympic thing getting in the way or the optics, you know what, I think it’s just sort of an overkill. Let him go one day.

BAIER: Byron, you are talking about already a Republican commercial out of this. What happens if he goes there, does the whole pitch, and Chicago doesn't get it and it goes to Rio? Is that another...

YORK: It would be a huge problem, obviously. He is putting presidential prestige on the line to do this. There are other cities that may be ahead of Chicago.

Chicago itself is divided amongst itself about whether to have the Olympics, whether they even want them. I think the polls show that the city is about split, half and half. And if it cost the city anything, most people are actually opposed to it.

So, in addition, by the way, he is taking a lot of the administration, he's taking the education secretary, I guess to talk about educational aspects of Olympics. He is taking the transportation secretary, Valerie Jarrett, his top advisor, one of his top advisors in the White House. It’s an ill-advised thing to do right now.

WILLIAMS: Because you think he is going to lose?

YORK: No. Even if he wins he has opened himself up to this priority. It is the priority argument that is the biggest thing.

HAYES: The problem isn't really that he is going. Heads of state do this. Tony Blair did it for London. Vladimir Putin did it for whatever.

BAIER: Lula Da Silva from Brazil is going as well.

HAYES: Right. This is what heads of states do. And the thought is that it will give the bid a boost. And I think that's probably true.

I think it is both one of priorities and one of optics, and that causes a problem for him.

WILLIAMS: Let me just say that other heads of states are going to be there. They are going to make their pitch. President Obama will make a brief pitch, and then he is coming home. And then you can beat him up some more.

HAYES: Other heads of state aren't running a war in Afghanistan.

WILLIAMS: I think it will be fine. We have people in place.

YORK: And also, he did say 12 days ago, I would go to Copenhagen to make the case for the Olympics personally if I were not so dedicated to providing health care to everyone.

WILLIAMS: That's why I was surprised Gibbs said it's under control.

(CROSSTALK)

BAIER: That's it for the panel.

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