This is a rush transcript from "Special Report," April 4, 2016. This copy may not be in its final form and may be updated.
(BEGIN VIDEO CLIPS)
PRESIDENT BARACK OBAMA: Iran so far has followed the letter of the agreement, but the spirit of the agreement involves Iran also sending signals to the world community and businesses that it is not going to be engaging in a range of provocative actions that might scare business off.
KT MCFARLAND, FOX NEWS NATIONAL SECURITY ANALYST: But what does Iran do next? They're going to have to do some tit for tat. There's going to be some response to this.
BILL HEMMER, FOX NEWS: You believe that?
MCFARLAND: Yes. I'm not sure what it is, but I think there will be more.
They're not going to take this lying down. They think they're in charge.
JOSH EARNEST, WHITE HOUSE PRESS SECRETARY: We obviously are concerned about this development because offering up support to the rebels in Yemen is something that is not at all consistent with U.N. Security Council resolutions.
(END VIDEO CLIPS)
BRET BAIER, ANCHOR: The White House today reacting to news of this interception by a Navy patrol ship last week going from Iran to Yemen, as you take a look at the region, the vessel carrying hundreds of rocket propelled grenade launchers, thousands of AK-47s believed to have been bound to Yemen, support from Iran, this after a ballistic missile test and other thumbing the nose at the world essentially from Iran.
Here is the ambassador to the U.S. for the UAE, Yousef Al Otaiba, writes in The Wall Street Journal, quote, "As Henry Kissinger once said, Iran can be either a country or a cause. Today Iran the cause is showing little of the same kind of pragmatism and moderation in its regional policies and behavior as it did in the nuclear talks. It is now clear that one year since the framework for the deal was agreed upon, Iran sees it as an opportunity to increase hostilities in the region. But instead of accepting this as an unfortunate reality, the international community must intensify its actions to check Iran's strategic ambitions."
With that let's bring in our panel, Charles Hurt: political columnist for The Washington Times; Julie Pace, White House correspondent for the Associated Press, and syndicated columnist Charles Krauthammer. OK, Charles, what about all this?
CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: You hear the administration's reaction to what Iran is doing and you want to weep. The president says it's not living up to the spirit of the agreement, as if anybody sentient would believe that the Iranians believe in the kind of spirit Obama does.
The reaction, the behavior of Iran since the signing of the agreement has shown that it has no concern whatsoever -- the ballistic missiles, the shipping of weapons to rebels, the using of Hezbollah to fight on behalf of Assad in Syria, the threatening of the neighbors. I mean, this was so obvious from the beginning. Then you get Earnest today saying that what the Iranians are doing with the weapons shipment is not consistent with U.N. Security Council. No, it's a violation.
And the worst part of this is not just the naivety. It's the exception that the administration used in selling the agreement on two fronts.
Number one, you show the clip of the administration spokesman saying the U.N. Security Council resolutions would prohibit ballistic missile launches. No. The administration at the last minute caved, changed the resolutions so it is not a violation, and we have now admitted it at the U.N. And secondly, we had promised the Congress that we would not allow the Iranians to dollarize their transactions, and we are doing that now.
BAIER: It had been alleged, Julie, that this was a sales job that evolved and had some change along the way. And people now in Congress are saying, wait a second, what you told us is not the fact.
JULIE PACE, ASSOCIATED PRESS: Yes, particularly on this issue of whether Iran will have access to U.S. dollars. You say a reaction from Republicans as well as Democrats and some people who have supported the agreement saying this may go a step too far. And I think that the administration has scene that reaction whether they carry this out and they do.
And on the broader question of the agreement, this was always the inherent intention on this, that you had the administration on the one hand saying this is a very narrow agreement that focuses only on the nuclear deal. At the same time, officials would say privately that they hoped the result would be that Iran would change its behavior in terms of ballistic missiles and other support for terrorism around the region. And you're simply not seeing that at least in the short term.
BAIER: Here's the Pentagon today and the White House reacting. Again, a lot of questions about this today at both hearings.
(BEGIN VIDEO CLIPS)
PETER COOK, PENTAGON PRESS SECRETARY: I don't think our picture of Iran has changed all that much. They have shown a willingness to conduct themselves in ways that we don't think add to the stability of the region.
EARNEST: One of the things that President Obama will discuss at the GC Summit in Saudi Arabia next month, or I guess it's later this month now, will be ramping up our efforts to counter Iran's destabilizing activities in the nation.
(END VIDEO CLIPS)
BAIER: You have the ambassadors of these gulf nations sending up flairs, Charlie. They're saying, wait a second, this is happening. This is all falling apart here.
CHARLES HURT, THE WASHINGTON TIMES: Yes, President Obama is fond of talking about how the arc of history bends towards justice. And what he -- and we're seeing this play out right here. What he forgets or fails to realize is that it only -- that arc only bends toward justice when good people do good things and smart things. And from the beginning, the idea of giving all of these rewards to Iran without getting any concessions from them, the idea that they can launch these ballistic missile tests, missiles that absolutely could reach into Israel, the idea that these weapons shipments to Yemen are not a violation of the letter of the law, letter of the agreement, just shows that his foreign policy is hope and change and close your eyes, because there is no willingness to use American might and American principle to force change.
BAIER: Let's turn to Ukraine, the interview with Poroshenko. Part of the answer we didn't air about Putin and his unpredictability, and if you were in Estonia or other countries in the region, would you be worried?
(BEGIN VIDEO CLIP)
PETRO POROSHENKO, UKRAINIAN PRESIDENT: This is exactly -- because of the unpredictability. Look, anybody playing that, OK, let's leave and let's calm Putin by this way. Then in 2008 during the Putin aggression in Georgia, I said, OK, let's give it this way and make him happy. This is not working, because now he started an aggression against Ukraine, forcing Crimea in the east of my country, and then he launch an operation in Syria.
(END VIDEO CLIP)
BAIER: We should point out that interview was done Friday before all the revelations over the past day about the Panama papers. We'll get to that in a second. His warning, Putin is on the move.
KRAUTHAMMER: And the problem is not that Putin is unpredictable. It's that Obama is predictable. And you can predict in advance that whatever Putin does, will receive no serious response from the United States. You know, we are now increasing our patrols in Eastern Europe. That's ridiculous. What the Eastern Europeans are begging for a permanent presence, a tripwire. That would actually assure them. Obama will not do it.
Can anybody explain to me why in Ukraine we to this day refused to provide the Ukrainians with defensive weaponry? They are not asking for offenses, simply defense. There's is obsolete and inadequate like I would say the Kurds in Iraq, but that's another story. We are leaving them twisting in the wind and we are leaving the initiative entirely up to Putin. If you are the Ukraine, you are the Baltic States, you are in Poland, you don't sleep at night on account of that.
BAIER: Last thing, this Panama papers story, explosive. Journalists from around the world, 11.5 million documents from this law firm in South America, and world leaders who are implicated either directly or through associates, there you see the list -- Russian President Vladimir Putin, Ukraine's President Petro Porschenko, as I said the interview was done Friday. I did ask him a bit about corruption, but not specifically about this. You see the others, the Saudi king, former Iraqi prime ministers, Syrian president Bashar al Assad. Essentially, Julie, the story is that they have shell companies and moving money offshore. We don't know the extent of how this goes.
PACE: We don't. But the revelations that we have seen so far are really incredible. When you look at the list of world leaders, it spans Europe.
It spans into the Middle East. President Putin is involved in this. It's really an incredible phenomenon apparently that's happening. And I think as journalists dig more into these documents there are some of these world leaders who are going to be quite worried about what's going to continue to be revealed.
BAIER: We will stay on it.
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