This is a rush transcript of "Special Report With Bret Baier" from February 16, 2010. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

CPT. ANTHONY DEPRIMO, INDIA CO. 3RD BATTALION, 6TH Marines: Our rules of engagement, they know that we can't fire upon them. You know in your mind common sense tells you I was just getting fired at from this compound and then I have three males come out, and we know it's them. We just can't do anything about it.

(END VIDEO CLIP)

BAIER: There are some real questions about the rules of engagement as the U.S. Marines continue their offensive in Marjah, Afghanistan, trying to confront the Taliban in southern Afghanistan.

But as you just heard that Marine talk about, when the Taliban engages, they have to — the Marines can fire back when they see them with guns. But if they put down the guns and they walk out and they don't have guns, they can't engage.

What about this? And what about how this is being — or could affect the battle on the ground in southern Afghanistan? Let's bring in our panel tonight, Steve Hayes, senior writer for the Weekly Standard, A.B. Stoddard, associate editor of The Hill, and we welcome Jonah Goldberg, at large editor of the National Review Online. Jonah, welcome to the panel.

GOLDBERG: Great to be here.

BAIER: What do you think of this? It seems strange. I talked to General Scales about it. He is concerned.

JONAH GOLDBERG, EDITOR, NATIONAL REVIEW ONLINE: I actually called around today because I thought it was kind of shocking, too. But the one that shocked me the most was the 72 hours of observing a house before you can call in an air strike against it, I mean 72 hours is a very long time. You can watch the entire run of "The Sopranos" in that amount of time.

And at the same time I called quite a few people who used to be in special ops, and the general sense is that while there is a tension there, you know, that you do need to have a restricted rule of engagement on this.

I think — I'm very much of a kill our enemies and see them driven before us kind of a guy, but at the same time, you know, this is a classic — this is one of the necessities of counterinsurgency. And while I think it sounds too strict, one of the guys I talked to suggested that they would tighten up air strike rules of engagement but loosen up the ground rules of engagement. That seems reasonable to me.

BAIER: Because, A.B., the concerns have been casualties from General McChrystal's point of view as he tries to protect the population in Afghanistan and tries to win back their support.

A.B. STODDARD, ASSOCIATE EDITOR, THE HILL: Right. The mission has changed. Last year saw the most civilian casualties. And General McChrystal's counterinsurgency strategy shifts the burden of risk to our men and women in uniform and away from the Afghan population.

The goal now is to earn the hearts and minds and to try to come up with some kind of development there, some kind of government there. It is an acknowledgment, and choosing counter insurgency. There was a debate about in this summer. Vice president Biden wanted to use counterterrorism strategies, tactics we're using in Pakistan with drone attacks, et cetera.

The president chose General McChrystal's strategy, and in choosing counterinsurgency over the other method, you are acknowledging we are going to be there a long time, that we are going to take more casualties, and we are trying to — we are increasing exposure in Taliban territory.

And we're going to take heavy losses that civilians used to take. It's because the goal is to earn the trust of the population. This is an acknowledgment that we are going there for years.

BAIER: You know, Steve, if the fatalities, U.S. fatalities start adding up from this battle, if you start seeing casualties and U.S. Marines with a real intense fire fight and they have this restriction, there may be a big push back quickly.

STEVE HAYES, SENIOR WRITER, THE WEEKLY STANDARD: I think there is no question there will be a big push back quickly. That's why I think it's important that you have people like Stan McChrystal and others get out and explain the strategy.

Look, this is part of the strategy of what we are doing in Afghanistan. We are broadcasting and foreshadowing what we are going to do. We are telling the population, here is where we are going to come. Here is how we are going to behave, so that they have a better appreciation of exactly what it is our soldiers are going to be doing.

They are doing that on purpose. I think you almost have to do something similar at home where you're telling people this is why we are operating this way. And A.B.'s summary of what exactly a counterinsurgency strategy involves is a good one. It means the U.S. is now assuming the burden of risk. It's something you will hear from anybody you talk to about this.

And on the one hand, it's hard to hear. It's hard to listen to because in a sense you are saying while these Marines, we're OK putting them at risk. And it doesn't, sort of, sound right. But, look, this is basically what happened in Iraq. We know it worked there. We had a long debate about this, as A.B. points out. I think this is the right strategy.

GOLDBERG: Also at the 30,000-foot level, there is a larger sort of messaging point that I think needs to be made, which is one I think Bush could have done better at, which is that we are the only great power in really in the history of the world with the possible exception of Great Britain that actually puts its own troops in serious harm's way in order to defend and protect civilian lives this way.

This is something that we should be bragging about and boasting about and take great pride in, the way we do war. That doesn't mean we should go too far and risk winning, because not winning looks even worse than killing civilians.

BAIER: Speaking of bragging and boasting, there was a big Taliban capture in Pakistan, Mullah Baradar, and he is said to be the top Taliban military commander. We don't have a picture there, the classic silhouette still. How big a deal is this, Jonah?

GOLDBERG: I think it's a huge deal. I think it's something that we should salute the Obama administration for. I think that, you know, getting back to the rules of engagement thing, that it highlights the importance of good intelligence gathering, because if you don't have good intelligence gathering, you have to be much more bloody-minded and ruthless when it comes to the actual military engagement.

BAIER: A.B.?

STODDARD: I think the biggest headline out of that capture is that we are gaining trust with the Pakistani government that they are not going to provide safe haven for the Taliban and they can be a working partner and it's worth our efforts to partner with them. I think that's the most encouraging thing.

BAIER: And Steve, The New York Times said they knew about it on Thursday, didn't report it because the White House said they wanted to develop the intelligence from this asset.

HAYES: We are accustomed from that kind of restraint from The New York Times, aren't we?

(LAUGHTER)

Look, I think The New York Times actually did the right thing. Hopefully we were able to squeeze a lot of information out of them and able to interrogate them in such a way that he was providing actionable intelligence quickly after his capture, something that we didn't have with Abdulmutallab, the Christmas day bomber.

BAIER: There is a little concern in that Pakistanis are involved in the interrogation as well. The Pakistanis have a long history of being tied to the Taliban. So you are kind of interweaving all of this as this intelligence is trying to be gathered.

HAYES: I heard a fascinating interview with Hamid Gul, a former general in the ISI, he basically said the problem with this is in the broader discussion going back to the rules of engagement and talking about Baradar is that you have a sense that the local populations think the Taliban is going to be here for years and years and years. And we have announced that we are not going to be here for a long time.

And that's a problem that I think pervades both of these issues.

BAIER: All right, we will look at the fallout from the Evan Bayh announcement and what the Democrats are going to do in Indiana and around the country — politics three minutes away.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. EVAN BAYH, D-IND.: There is just too much brain-dead partisanship, tactically maneuvering for short term political advantage rather than focusing on the greater good, and also just strident ideology.

The extremes of both parties have to be willing to accept compromises from time to time to make some progress because some progress for the American people is better than nothing. And all too often recently we have been getting nothing.

(END VIDEO CLIP)

BAIER: Democratic Senator Evan Bayh from Indiana one day after announcing he will not seek reelection in 2010, talking about his decision-making process.

In the meantime Democrats were scrambling. This little known Democrat from Bloomington, Indiana, Tamyra D'Ippolito, she needed 4,500 signatures to get on Indiana's Democratic primary ballot. She said she had them. She said she had all the signatures, 500 in each Indiana district. It turns out at last count, before this show, she had 112.

So, it will not be anyone on that ballot. And the Democrats in Indiana will pick in a convention in June the nominee. We're back with the panel. A.B., it was an interesting political development there. What about the Democrats scrambling in Indiana?

STODDARD: Well, obviously the announcement by Senator Bayh was a real shocker, especially the timing of it. I think Democrats in Indiana feel very burned by the fact that he did it right before the primary filing date. I think they felt that was a little bit selfish.

He has been feeling he has been lamenting the changes in the institution for a while, gave no indication when asked to reassure the leadership to Senate Majority Leader Harry Reid that he would definitely run for reelection, that was hint. But he did this right before the filing deadline, leaving the party in Indiana grasping to find somebody.

They don't have a bench. They will end up having people interested and they will appoint someone. But the way that it happened was unfortunate for the Democratic Party in Indiana.

That said, I don't think that they can keep the seat anyway. I think it's going to go Republican along with several other seats in this fall's elections.

But even looking at how it would affect Democrats in the House, if you have Congressman Hill or Congressman Ellsworth, Brad Ellsworth, excuse, me from Indiana deciding to take a look at that and making a run to replace Evan Bayh, you still open up these very recently Republican either, you know, recently picked up seats by the Democrats that will go right back into Republican hands.

So it poses problems for the Democrats in either chamber.

BAIER: Steve?

HAYES: I think if you look at the way Indiana plays out. Indiana is a red state. It's been a red state. They have elected Democrats, but it's basically a conservative state.

I would be shocked with either Ellsworth or Barron Hill thought it was in their interest to get in this race anyway. If you take a step back, Ellsworth is the kind of candidate that can win in Indiana because he's pro gun, pro life, et cetera.

But this is going to be a year where small government conservatives win and win big. And what we have seen in the analysis of the Bayh departure, the Bayh retirement, is everybody on the networks talking about anti-incumbent mood.

It's not anti-incumbent mood, or it's only a partially anti-incumbent mood. What we are seeing is ideological movement. You are seeing that manifested in the tea party movement. But you are seeing conservatives, small-government types, come out and be energized and invigorated in a way that they haven't probably since 1994.

BAIER: What about that, Jonah, the 30,000 foot look at the Bayh decision and what it means for politics overall. Look at somebody like Barbara Boxer in California facing a race that that she is only four points up in the latest poll. It's changed dramatically in just a matter of months.

GOLDBERG: Yes. And I think that's in some ways one of the most devastating things about Bayh's decision is it casts in stone this narrative that was already hardening that the country is fed up with Washington, that the country has gone on the wrong track. Obama messed up his first year. The Democrats have messed up their chance.

And that was, you know, Bayh's parting shot at Reid and the process and the Congress generally reinforced all of that in a way that I don't think now can be rewritten. And that is the narrative that we will be going into all the way into the midterm election.

BAIER: And is there a narrative here A.B. that conservative Democrats are really in trouble? I mean, they are really a breed that's becoming extinct. It was the other way around just a few months ago. Moderate Republicans were said to be the ones that were leaving in droves.

STODDARD: I think both parties are becoming very polarized and they are purifying, and I think that's unfortunate for everybody. I think it's unfortunate for Republicans who will be back in power soon to lose someone like Evan Bayh who they would need to work with across the aisle.

I think it's unfortunate for Democrats that they don't have a big test. And I think it's — I think it's bad for the taxpayers that people like Evan Bayh and Patrick Kennedy or whoever, members on both sides of the aisle actually this year who are leaving because they believe that the place is broken down. It's paralyzed by partisanship.

It's under a stranglehold of big industry. You have to fund raise the day you get there. There is no incentive to work with the other side. There is no coming together to legislate on anything big.

It's hard for these guys to imagine who are leaving to ever seeing anything big happening again in the professional lifetimes in the Congress, and I think that's bad for everybody.

HAYES: But it's a lot more than that. It's that, but it's a lot more than that. And this is what I think people are generally missing in the mainstream media. This is ideological movement. Evan Bayh didn't leave only because things are broken. He left because he is hung out to dry by the Obama agenda.

The Obama that agenda is a big government agenda, and you are seeing people more and more self-identify as conservatives, even people who are not saying to pollsters yes I'm a Republican. They are saying I'm an independent, but I'm a conservative.

BAIER: And Jonah, quickly, the White House communication answer is to sharpen the message and to get out the specific message of these policies, saying it's just the way they have communicated that's not caught on.

GOLDBERG: It's the ring the cow bell even louder the same way they have for the last year. And I don't think — I think that is a real sign that they are in a bunker and they are suffering from group think and they are blaming all of their problems on this messaging and marketing and buzz phrase stuff and not on the fact that they have gotten the policies wrong from the get-go.

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