Updated

This is a rush transcript from "Special Report," May 28, 2014. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

PRESIDENT BARACK OBAMA: Al Qaeda's leadership on the border region between Pakistan and Afghanistan has been decimated and Usama bin Laden is no more. Today's principle threat no longer comes from a centralized Al Qaeda leadership. Instead it comes from decentralized Al Qaeda affiliates and extremists. Many with agendas focused in countries where they operate, and this lessens the possibility of large scale 9/11-style attack against the homeland, but it heightens the danger of U.S. personnel overseas being attacked, as we saw in Benghazi.

(END VIDEO CLIP)

BRET BAIER, ANCHOR: President again at West Point today. We're back with the panel.  Steve, what about this assessment of Al Qaeda and what intelligence officials are privately telling us is a growing effort by these affiliates that proves to be just as dangerous as Al Qaeda ever was.

HAYES: I think this is yet another case of the president seeing the world as he wishes it were rather than the world as it is. There's no question that Al Qaeda has dispersed from Afghanistan and Pakistan. But the question is have they done so with purpose, and what are they doing now? Is core Al Qaeda -- to use the president's distinction that he makes all the time -- still active? Is it still helping to run things? There are certainly connections between core Al Qaeda and what is happening in Syria. There is no question that there are connections between core Al Qaeda and the replenished core Al Qaeda and a variety of affiliates.

The same thing that the president just said about these affiliates, that they are focused locally, that the threat is diminished, was also said about Al Qaeda back in the 1990s. You know, this group, the Egyptian Islamic Jihad is focused only on Egypt, only on Egyptian politics. They are always focused on what is in front of them until they are not, until they turn their eyes towards the United States. I think it's false comfort that the president is taking, but it's not the first time we've heard this. Back in April of 2012, John Brennan, the president's counterterrorism adviser, predicted that Al Qaeda would be in effect eliminated by the end of this decade. That certainly doesn't look like it's a prediction that's likely to come true.

Congressman Pompeo, a Republican congressman, said he believes Al Qaeda is greater, stronger, the threat from Al Qaeda today is stronger than it was when President Obama took office. And there are these other assessments that are starting to bubble up, Mara.

MARA LIASSON, NATIONAL PUBLIC RADIO: You mean in terms of able to it launch an attack on the homeland or just -- what are the criteria?

BAIER: Across the board.

LIASSON: Because there is no doubt that it's metastasized. But whether it's in any position to do what Usama bin Laden did and launch an attack on the United States I think is debated. But there is no doubt that the Al Qaeda threat is there. It's serious, and it's in a lot of places, and, in particular, in Syria where we have a pretty unpalatable choice there between Assad and Al Qaeda.

BAIER: Is there a disconnect between what, for example, Senator Dianne Feinstein says about Al Qaeda and what this administration is publicly saying?

LIASSON: Well, this was a very positive speech about all of the accomplishments across the board. And this is a really dangerous world, and the president hasn't really gotten a handle on it. And one of the things he talked about was beefing up the capacity, the antiterrorist capacity of our allies and other countries, which is, I think, a really good idea. He proposed $5 billion to do that. That's pretty small. We will see if the Republicans kind of meet him and raise him a little on that.

BAIER: Charles?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Look, I think this is rose colored glasses. Here's a president trying to justify his foreign policy by pretending these successes. I don't know anybody who believes that when a cancer metastasizes you are better off. I don't think anybody thinks, as he was saying, that America stood tough on Ukraine and isolated Russia. Russia just completed the biggest energy deal in the history of the galaxy with China that's going it to supply it with a customer for 30 years. This is isolation? I mean, he didn't even mention that Russia swallowed Crimea and has essentially reduced Ukraine to a vassal state.

He looks around the world and sees what he wants to see. I think that's rather alarming. And I do think that what Steve about retroactively creating a theory of what he did is true, because what was the last doctrine, the duty to protect. That was the theme of the great speech he gave on television on the eve of the Libya intervention. This is what America does. America does not stand by when cities are reduced like Benghazi. Of course, he stood by now for three years while 160,000 are slaughtered in Syria. So he adopts a theory retroactively, a way to fit what are a series of completely unconnected ad hoc decisions. And that's the Obama doctrine, ad hoc, every day a new idea.

BAIER: So, grade the speech.

KRAUTHAMMER: The speech, I would grade like the policy, C minus.

LIASSON: No. I give him a B.

STEVE HAYES, SENIOR WRITER, "THE WEEKLY STANDARD": C minus? No. It was an F. It was borderline delusional. He is seeing the world that he pretends exists. It doesn't exist in the minds of so many other people.

(CROSSTALK)

HAYES: Soft again, Charles.

(LAUGHTER)

BAIER: Here we go. Final thing, we'll get reaction from the panel about the latest from the V.A. when we come back.

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