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Special Report

'Special Report' Panel on Elections, Politics, and Campaigns

This is a rush transcript of "Special Report With Brit Hume" from December 21, 2007. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R) PRESIDENTIAL CANDIDATE: On night after being mistreat ed as a POW, a guard loosened the ropes binding me, easing my pain. By Christmas, that same guard approached me, and without saying a word, he drew a cross in the sand.

We stood looking at the cross, remembering the true light of Christmas. I'll never forget that no matter where you are and no matter how difficult the circumstances, there will always be someone who will pick you up.

You and your family have a blessed Christmas and happy holidays. I'm John McCain, and I approved this message.

(END VIDEO CLIP)

BRET BAIER, "SPECIAL REPORT" GUEST CO-HOST: That's Senator John McCain's new ad, "My Christmas story," just starting airing. Let's look at some of the polls in New Hampshire. The Real Clear Politics average of all the polls, you can see McCain is in second place there at 23.2, behind Mitt Romney, and he is obviously moving up in the polls.

So let's talk about this surge for McCain. Some analytical observations about it from Fred Barnes, Executive Editor of "The Weekly Standard," Mort Kondracke, Executive Editor of "Roll Call, and syndicated columnist Charles Krauthammer, FOX News contributors all.

Fred, it's undoubtable that if you look at all the polls that there is a surge.

FRED BARNES, EXECUTIVE EDITOR, "THE WEEKLY STANDARD": You can tell, even if you go out with McCain, that there is a surge. You don't really need the polls. It's really palpable. I went out with him last week, and he's getting larger crowds, he's getting enormous interest.

And I think the phenomena here is most people say well, the war is going better, he has been for the war, it is his strategy that is being applied in Iraq.

I think there's something different than that. The guy who came close to identifying it was Joe Lieberman, the Democratic Senator, who endorsed him a few days ago, to the surprise of me, anyway. Maybe others had expected it, but he is somebody who knows and respects McCain.

And he said McCain is no ordinary politician. And he's not. He's different. And we saw in that ad — we know what he has gone through in serving his country in five plus years as a POW. We know what his character is.

We know that he is withstood a test that no other candidate could even dream of, and, as a result, I think a lot of conservatives who are mad at McCain, as I am, for a lot of things like campaign finance reform and voting against the Bush tax cuts, and so on, are coming back to him as being the most solid candidate.

BAIER: Mort, what about that ad, first of all?

MORT KONDRAKE, EXECUTIVE EDITOR, ROLL CALL: I think it was a great ad, and it had a religious overtone to it.

BAIER: And there is no hiding the cross there. That's a cross.

KONDRACKE: Exactly, and so it should remind religious candidates that there is another candidate in the options besides Huckabee.

I have long been an adherent of the primogeniture theory of how the Republicans Party picks its nominees: the next oldest guy in line gets to be the king. And that was McCain. At the beginning of this campaign, it was McCain.

And then the Party thought, well, you know, he's tired, old goods, and he was for immigration, and they were mad at him, as Fred says, and they went off and romanced with all these other candidates, and it just may be possible that they're going to come back and rediscover him as the character candidate.

And, also, the polls indicate that that he is the Republican candidate best able to defeat any of the likely Democratic nominees.

BAIER: Let's put that up. FOX News Opinion Dynamics Poll, a new one: against Hillary Clinton, there you see McCain at 47 percent, Clinton at 42. and that has changed since November.

Charles, is this surge — can he continue this not only in New Hampshire but other places?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Well, he needs New Hampshire to propel him, because he's really out of money, and he will need the free media he would get from the victory. He is actually climbing in at least one poll even in Iowa even, where he came out against ethanol.

And that tells you a lot about the guy. What he has in authenticity. You come out against ethanol in Iowa, you are really is saying I will say whatever I believe.

And that's why the surge and the success in Iraq and so forth, it is not just that he got it right with the policy and advocating a surge and a new strategy, it's that he was willing to go down with the ship, where he said all year long at a time when things were not improving earlier in the year, "I would rather lose a campaign than have my country lose a war."

This is a man of stature as you see in that ad. That's why he gets the endorsement of "The Boston Globe," of the "De Moines Register" liberal paper, a former Democratic candidate for the vice-presidency.

He is a man who has appeal to independents and Democrats as a national figure, unlike any of the other Republican candidates.

BAIER: Let's talk about Huckabee and this arrogant bunker mentality that was in this foreign policy paper and also in his speech. Secretary of State Condoleezza Rice was asked about that today. Take a quick listen to this sound byte.

(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, SECRETARY OF STATE FOR THE UNITED STATES OF AMERICA: The idea that somehow this is a go it alone policy is just simply ludicrous. And one would only have to be not observing the facts, let me say that, to say that this is now a go it alone foreign policy.

(END VIDEO CLIP)

BAIER: Mike Huckabee said that perhaps she didn't read the article. Then he said I don't remember whether I actually wrote the words "arrogant bunker mentality." It might have been somebody else, but I own them.

So what about all of this?

BARNES: Well, look, I didn't know he was trying to pass it of to some speech writer, or something. That is not a good sign for his campaign.

The truth is he is wrong, and the problem is that he is ignorant of what is going on in American formal policy. Clearly the U.S. has not isolated itself in foreign policy and only doing things unilaterally. Just look at the six countries that are involved in North Korea and the European group with the Iranians, and so on. The fact is he was simply wrong.

BAIER: More, quickly, is McCain the beneficiary of the people who may get iffy about voting for Huckabee?

KONDRACKE: Well, he has certainly won. In Iowa, it would be Romney, presumably, but in New Hampshire, it would be McCain, I guess.

KRAUTHAMMER: I would like a response to his response to Secretary Rice: "She may not have read the words that I didn't write."

BAIER: That's the last word of this panel. When we come back, how is President Bush doing reigning in the three countries he called the "Axis of Evil almost six years ago? Our panelists get their score cards out next.

(COMMERCIAL BREAK)

(NO CAPTIONING)

KRAUTHAMMER: People have the impression that Iraq is a debacle and Iran is OK after this intelligence report that it's not pursuing nukes, and we are dealing with North Korea.

I think that conventional wisdom is completely wrong. Iraq is a success in the sense that Saddam and his sons are gone, that dynasty which would have been a threat to us and the region for a generation is gone. Iraq is on its way to, I think, success.

Iran is a debacle, because after that intelligence report, which was misleading —

BAIER: The National Intelligence Estimate.

KRAUTHAMMER: — which gave the impression that Iran has given up seeking nukes. It's actually only, perhaps, halted one element, the least important element of a nuclear program.

But, because of that report, the administration has lost all leverage, is even going to have trouble with sanctions, and I think the Iranians are going to end up with a bomb in the next administration.

And North Korea, it's a bit of a mixed picture. It's dismantling its plutonium reactor, but it is hiding the uranium program. And the real issue today is: is Pyongyang going to declare it and dismantle it, or is it going to hide it? And we don't know.

BAIER: So you are saying one for three.

KRAUTHAMMER: One for three that we know. The others are iffy and very dangerous.

KONDRACKE: I agree with the bottom line, here. The question I would have is: suppose we had not invaded Iraq and concentrated heavy diplomacy on Iran. Iran is clearly long term more dangerous — well, in the medium term, a more dangerous power than Iraq would have been. Iraq had no weapons of mass destruction, did not have a nuclear program going. Iran was working and is working on a nuclear weapon.

Now, if we had not gotten ourselves afoul of the whole wide world by invading Iraq and then making a botch of it for a very long time, would we have been able to unify everybody around pressure against Iran the way we have succeeded with North Korea?

And we have done it very well. We've done it with multilateral diplomacy. And we have got inspectors in there now. We have got a lot of intelligence information. We don't have any intelligence information about Iran, because we have no diplomatic contact.

BAIER: What do you say to the people who say that Iran halted its nuclear weapons program because of the Iraq military situation?

KONDRACKE: And then started it up when it looked as though we were losing in Iraq. You can't rewrite the history, but it's worth questioning what would have happened if we had done it in reverse.

KRAUTHAMMER: The question is "No."

BARNES: Of course that's the answer.

KRAUTHAMMER: It would not have stopped Iran.

BARNES: We can't rewrite history — of course, he just tried to right here in an attempt to take an entirely unfair swipe at the Bush foreign policy.

But in any case, I would give him, Charles says one out of three, Mort seems to say that. I would say one-and-a-half out of three, actually, for the reasons that Charles said, because they have — we have a nuclear reactor. We know it's been dismantled.

There is a lot left to do. Probably one of the things is we know they have actually built nuclear weapons there in North Korea. They are supposed to turn those over. That is a mission that I think the U.S. is going to try to accomplish in 2008 — good luck.

KRAUTHAMMER: Mort, your assumption if we had not done Iraq the world would have loved us and would have joined in stopping Iran is completely pie in the sky. Unless you would have invaded, you wouldn't have stopped the program.

BAIER: That's the last word, no response this time, Mort.

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