The following is a transcribed excerpt of "FOX News Sunday" for November 28, 2004.

CHRIS WALLACE, FOX NEWS: The White House continues to hold out hope that congressional negotiators can hammer out a deal that would reform the nation's intelligence agency.

If that's going to happen, it will take a compromise between our two guests: Republican Senator Susan Collins, who's been the Senate's lead negotiator, and Republican Congressman Duncan Hunter, chairman of the House Armed Services Committee.

Welcome to both of you. Thanks for joining us today. We appreciate it.

U.S. REPRESENTATIVE DUNCAN HUNTER, R-CA: Good to be with you, Chris.


WALLACE: Let me ask you both to start at the beginning here. What are the chances for a deal on an intelligence reform when Congress comes back into session on December 6th?

Senator Collins, why don't you go first?

COLLINS: I think the prospects are very good. The president supports this bill, the 9/11 Commission supports this bill, and a majority in both houses supports the bill.

I'm convinced that had the speaker brought the bill to the floor, that it would have passed in the House.

And I'm hopeful that now that his members have had more time to review the details of the bill, that he will schedule it for a vote. I'm convinced that if he does, it will pass.

WALLACE: Congressman Hunter, let me ask you the same question about the chances for a deal. But it sounds like what Senator Collins is talking about is rethinking your decision to oppose the conference report, the bill that was rejected or blocked last week.

Are you willing to vote for it now?

HUNTER: Well, Chris, everybody supports having an intel reform bill. The question is what kind of bill. And the answer is we have to do it right.

And there's a fundamental difference here. Right now you have 138,000 Americans in combat in Iraq, about 20,000 in Afghanistan. And our troops today are hooked up to satellites for a great deal of their intelligence information, telling them where the enemy is, where he's going, et cetera.

And you have to maintain that close, tight-knit relationship between the combat support agencies that run those satellites and the war-fighters, whether it's a team of special forces in Mosul or the 1st Marine Division in Fallujah.

When you need a satellite going over your position, you have to be able to command that satellite. And the Senate is not willing to maintain what we call the chain of command control between the war- fighters and the combat support agencies that run those satellites.

Fundamental difference — it's a difference that at some point means life and death to our people in the field.

And thank God for the House Republicans and the House leadership that, listening to the Joint Chiefs of Staff, to the Army, the Navy, the Marine Corps, the Air Force, decided that we needed to make sure the Senate came across the finish line on this important, tight lifeline between the troops in the field and the people that run the satellites, literally their eyes and ears.

And the satellites today are just like the cavalry was in the old day; it's the eyes and the ears of our war-fighters. We've got to maintain that lifeline.

The Senate has to move on this provision, or we'll be worse off than we were before.

WALLACE: Senator Collins, let me ask you about this. What we're talking about here are three what are called combat support agencies, including the National Security Agency, which intercepts communications; the National Reconnaissance Office, which runs spy satellites.

Do you believe, as Congressman Hunter says, that passing this intelligence reform would somehow break the link between the satellites, between that battlefield intelligence and the people who need it on the battlefield?

COLLINS: No, I don't believe that.

Chris, the commander in chief, our president, supports this bill. It's inconceivable to me that the commander in chief would support a bill that in any way weakened or undermined the flow of intelligence to our troops.

The fact is, there is nothing in this bill that in any way hinders military operations or readiness.

Under our bill, tactical — that's the battlefield intelligence and joint military intelligence — would remain under the control of the Pentagon, as it is today. The three combat support agencies would remain within the Pentagon, as they are today.

I would quote Secretary of State Colin Powell, who says that this bill will improve the quality of intelligence that goes to our war- fighters.

We have to remember that it's not only our troops which are our primary concern that we rely on those national assets. The CIA and other agencies do as well.

But there's nothing in this bill that would in any way hurt the intelligence provided to our troops. Just to the contrary: It would help improve our ability to predict such incredible developments as the insurgency in Iraq that has resulted in the loss of so many lives.

WALLACE: I have to say, folks, I'm confused, and I'm sure a lot of the viewers are too, because you've got two staunch Republicans who, one says that it would interfere with intelligence getting to the battlefield; another one says it wouldn't.

Congressman Hunter, help us out here. Let's get very specific. Take away all the boilerplate. What specifically do you think would interfere with that intelligence getting to the soldiers?

HUNTER: Very, very simple, Chris: chain of command. That means that when the Department of Defense has to have a satellite over Fallujah, for example, because they've got people being shot at on the ground — they need to know where the enemy is — you have to be able to control that agency. That is, to order that agency to put that satellite where you need it at that point.

Everybody who's ever been in the military understands chain of command. That means when the sergeant tells you to do something, it's not a suggestion. The Senate does not want to have a chain of command.

WALLACE: But specifically, Congressman, how would that change intelligence reform?

HUNTER: Well, very simply, the combat support agencies would not be under the total command and control of the Department of Defense.

That means when you have a need for a satellite, let's say, over Fallujah — and it may be a special forces team of just five people — if you've got to have it, you have to be able to order it to be there.

And that means you don't go back through some bureaucracy in Washington, D.C. and say, "Well, general, maybe we can send that satellite over, but, you know, we think the CIA may want to do something else with it. We'll get back with you."

Having a nonresponsive chain of command or having a lack of chain of command translates into combat casualties.

And that's why the chairman of the Joint Chiefs weighed into this conference, deep in the conference, and said the House provisions are important. And that's why the Army, the Air Force, the Marine Corps and the Navy all testified about a week ago in favor of the House position.

WALLACE: Let me ask you, Senator Collins — and let's try and keep it as specific as we can. When the congressman talks about those nonresponsive bureaucracies in Washington, he's talking about the fact that these agencies, all 15 intelligence agencies, would be under the national intelligence director.

Would the reform that put them under the NID, or the "NID" as it's called, would that make it harder for the general in the field, the colonel in the field, to get that satellite over Fallujah?

COLLINS: No, it would not.

The Senate specifically rejected an amendment to take those combat support agencies out of the Pentagon. I led the fight against that amendment, along with Senator Joe Lieberman, in the Senate.

The commander in chief would not be supporting this bill if these fears were to be realized.

But under the congressman's proposal, those combat support agencies would be under the exclusive control of the Pentagon, despite the fact that they also provide valuable information to the other policy-makers, including the president.

Our troops are always going to be our first priority. These agencies remain in the Pentagon. The heads of the agencies report to the secretary of defense.

None of us would ever support legislation that in any way impairs the flow of intelligence to our troops.

But the fact is that the status quo has not served our troops well. While the tactical intelligence that they are provided with is terrific, a lot of times they've been let down by a lack of analysis and coordination on national intelligence.

The 9/11 Commission painted a picture of a lack of coordination that hurts our troops.

WALLACE: Let me ask you both — I want to switch to something that's just it a little bit — but what we're seeing here...

HUNTER: And actually, Chris, the 9/11...

WALLACE: Now, let me just, if I may, ask a question, Congressman.

What we're seeing here is Republicans fighting other Republicans. And there's a growing body of thought here in Washington — Congressman Hunter, I'll ask you to respond first — that the president is going to have his hands full with the increased majorities, Republican majorities, in both the House and the Senate.

HUNTER: You know, Chris, in matters of intelligence, in matters of national security, there is no partisanship. In this case, it's simply one of judgment. And there are Democrats and Republicans on both sides of this issue.

And the real key — I think Senator Collins has moved us along here in this argument by admitting that, yes, there is a national intelligence apparatus in Washington that wants to control these satellites.

And it's true that you have two customers. You have the CIA, which is a customer of the satellites. You have the Department of Defense. So the question is, who has primacy? Who has control when it really counts?

And my judgment is that the people whose lives are on the line — we've taken over 50 KIA in this last Fallujah operation, hundreds of wounded people — the entity that has its lives on the line in large numbers, which is the Department of Defense, in the war against terror, has got to have that responsiveness.

HUNTER: And they have to have primacy with respect to control over these agencies, which, once again, are their combat support agencies, their eyes and ears.

And if the Senate really said we still have that, then they shouldn't be objecting to have a chain of command, not a chain of suggestion, which is what they want to have.

WALLACE: Senator Collins, you willing to see it Congressman Hunter's way?

COLLINS: You know, I have enormous respect for Congressman Hunter, and I know he's very sincere in his beliefs.

I would point out that the language he is referring to was drafted by the vice president's counsel, the chain-of-command language. I know that the vice president, like the president, understands what is in the bill, and they support it.

All of us are dedicated to our troops. I'm a member of the Senate Armed Services Committee. I would never support a bill that in any way jeopardized our troops.

WALLACE: Senator Collins, Congressman Hunter...

HUNTER: Actually, I...

WALLACE: ... we've got to go, but I want to thank you both so much for joining us today.

HUNTER: That's OK.

WALLACE: I'd have to say, I think there's some more work that the two of you and all of the rest of Congress has to do to get this thing cleared up.