This is a rush transcript from "On the Record," September 17, 2012. This copy may not be in its final form and may be updated.
GRETA VAN SUSTEREN, FOX NEWS HOST: Stephen Hadley, national security adviser to George W. Bush, is here to go "On the Record." Stephen, the murders in Libya -- spontaneous or premeditated?
STEPHEN HADLEY, FORMER NATIONAL SECURITY ADVISER: Probably some of both. I think one of the things that's clear is it was an opportunity, and it was an opportunity taken advantage of by Salafist and extremist groups to demonstrate against the United States, and do more than just demonstrate against the United States, because they are anti-American.
But also, it was an opportunity for them to put pressure on some more moderate governments in terms of their spectrum, of which they are not a part, to put pressure on those governments to force them to move more against the United States, and to undermine those governments because it knows that those governments are cooperating with the United States because the United States is important for them to -- those governments to achieve a better life for their people.
And I think also, the longer this goes, the more we find out about it, the better the chance that in at least some of these instances, al Qaeda was active, as well. I don't know that. My hunch is, you know, when people show up to demonstrations with, you know, anti-tank -- with RPGs, this is not a spontaneous uprising, this is some people who were taking advantage of an opportunity to kill Americans.
VAN SUSTEREN: When -- when this -- over the past three or four days, it's -- you know, while -- you know, I don't think the four who've been killed has even been buried, there's now an autopsy going on -- is the obsession has been whether the -- whether it was provoked by the video or not. The administration is -- you know, is out there in front saying it's provoked by the video. Why -- what is the reason that they are -- that they're fixated on that?
HADLEY: I don't know. I think provoked, I think pretext provided an opportunity. It's clearly been taken advantage of by a lot of factions. And I think you've seen some people in the press talk about this -- taken advantage of by extreme -- extreme groups to put pressure on governments to separate themselves from the United States.
VAN SUSTEREN: But what does it matter?
HADLEY: That's the agenda.
VAN SUSTEREN: What does it -- I mean, the bottom line is that we have hostile situations in a number of countries. They're burning our flag. This is not a good situation. And yet the whole -- it's -- everyone's sort of is fixated on whether it's the video or not.
HADLEY: I can't explain it. And I also think we need to step back and say it is a very serious situation in itself, but it is part of a broader situation in the region, which I think is extremely serious, and it starts really in Syria, which is increasingly becoming a forum for a sectarian war between Sunni and Shia that risks destabilizing Lebanon, Iraq, Jordan and even Turkey, and runs the risk of sectarian warfare that engulfs the Middle East.
And it is urgent. It is serious. And the administration does not seem to have a policy that is commensurate with the seriousness of the problem and the rapidity of the events.
And at the same time, in terms of Iran, Iran continues to move towards a nuclear weapon, and we seem to spend more time putting pressure on Israel not to strike Iran than figuring out what we're going to do about Iran.
So I think it's a troubling time. This is a Middle East that's in meltdown, and our policies seem to be in some sense frozen. And the administration talks about how they have more time. I think we're running out of time, and I'm worried about it.
VAN SUSTEREN: How do we unwind ourselves out of this situation? I mean, we've got -- whatever -- whether -- no matter why it happened, we now have this situation and it is a crisis. What do we do?
HADLEY: Well, one of the things we don't do is we don't pull out because these people who are demonstrating against us, that's exactly what they want to do. They want us to pull out and clear the space for their more radical agenda.
So I think one of the things we need to do is we need to be more engaged. We need to help those governments that legitimately are trying to bring political and economic reform to their people and try to help them succeed and deal with some of the frustration that they have.
And then we need to deal more aggressively with this deteriorating situation in Syria, and again, with the clock that is ticking in Iran. So I think what we don't do is withdraw. What we do need to engage, with some imaginative and more ambitious policies, because we have a lot at stake here. We have a lot of interests here, and we need to be active in protecting those interests.
VAN SUSTEREN: Well, Egypt is -- is certainly very important to Israel in the Middle East. And you've tot the situation where -- where President Morsi this weekend received President Bashir of the Sudan, both Muslim Brotherhood -- put both of them in office. That doesn't look like President Morsi is leaning towards trying to -- to sort of put the lid on problems, if he's meeting with a fellow Muslim Brotherhood president who, incidentally, is under indictment for genocide, and he should have him arrested in his country and turned over to the ICC.
HADLEY: Look, Bashir is a bad guy, and I can't explain or excuse his meeting with him. I wasn't a fan of his going to Iran, though, when President Morsi did go to Iran, he denounced then for their policy on Syria in very forthright terms. That's a good thing.
He's obviously trying to find his way. This is a problematic government, but it is the government that the Egyptian people elected. I think, therefore, we have no alternative but to work with that government, but not in an unconditional way.
I think what we need to do is make clear we're prepared to work with these governments, even Muslim Brotherhood-led governments, as long as they are prepared to bring their country to economic and political reform, establish inclusive political systems where everyone is able to participate, individual rights are respected.
If that is the future -- we think it's the future their people want. If that's the future they're bringing to their people, we're prepared to cooperate in that. But we ought to be clear that that's the kind of Middle East we think is best for us but also best for the people in the Middle East.
VAN SUSTEREN: Thank you, Steve. Obviously, a very dangerous situation. Thank you.