The following is a partial transcript of the Dec. 10, 2006, edition of "FOX News Sunday With Chris Wallace":

"FOX NEWS SUNDAY" HOST CHRIS WALLACE: To discuss the report that's dominating the debate over Iraq, we're joined now by the two co-chairs of the Iraq Study Group. From Houston, former Secretary of State James Baker. And here in studio, former Congressman Lee Hamilton.

Well, gentlemen, as you know, the president is reviewing your report and several internal studies, and plans to announce a new approach to Iraq before Christmas.

Secretary Baker, what are you going to be listening for? What does he need to say when he addresses the nation?

FORMER SECRETARY OF STATE JAMES BAKER: Well, I'm going to be listening, as I'm sure are a lot of other people, to see exactly what it is that the president thinks we should do to effect a new approach. He was, I thought, positive when we presented our report to him. He said, I like the idea of a new approach. I think we need a new approach. And so we'll be watching to see exactly what that new approach is. Hopefully, it will be a comprehensive one, such as we laid out in this report.

WALLACE: Congressman Hamilton, there's a report in The New York Times today that some administration officials believe that your recommendations are, as they put it, unrealistic, and they specifically take issue with the fact that in your report, you never set as an objective victory or democracy in Iraq. How do you respond?

FORMER CONGRESSMAN LEE HAMILTON: We accepted the goal that the president has articulated — a government that can govern itself, sustain itself, defend itself. We think that's a reasonable goal. It's an achievable goal. And we support it. And the whole strategy of our report is to try to seek to achieve that goal.

WALLACE: Is — because of the news conference the very next day with Prime Minister Blair, he talked about victory, he talked about democracy. Congressman Hamilton, are those realistic and achievable?

HAMILTON: It all depends on what you mean by victory. You have today an elected government in Iraq. We have all kinds of proposals in the report to strengthen that government and sustain it. In that sense, then it is achievable.

It all depends on how you define these words, "victory." As the president himself has set out the goal, we think it's an achievable goal. And if we achieve our goal, then I would think that would be satisfactory.

WALLACE: Secretary Baker, in your report, you talk about a goal of 2008 for getting most combat forces out, clearly conditioned on what the situation is on the ground. How important is it to put out a specific date, both for the American people and for the Iraqis?

BAKER: Well, we didn't put out a specific date that was not the administration's own date, Chris. This is the date by which General George Casey said the training and equipping mission would be completed. And as your question points out, there's a lot of flexibility built into — in there for the commander in chief and for the military commanders on the ground.

And so I think it is important if you're going to change the primary mission of the — of our forces there, from one of trying to referee sectarian violence, if you will, to one of training, equipping, supporting and advising the Iraqi army, that you at least refer to the date that the administration itself has set out as the date by which that could be completed.

WALLACE: Secretary Baker, do you think it's important for the president in his speech to set out a date, even if it's conditioned with all these caveats, again, to say to the American people and to the Iraqis, this is not an open-ended commitment?

BAKER: Well, we say in — we don't say it's critical to set out a date, Chris. We do say that there should be no open-ended commitment. And by the way, with reference to your earlier question to Lee, we don't negate the goal of democracy. The goal of democracy has always been a goal and foundation and basis for American foreign policy, and it will always remain that. We adopted the president's own definition of what success is in this case.

WALLACE: Congressman Hamilton, given this goal of early 2008, how soon could the first troops start to come home?

HAMILTON: We don't get into that kind of a tactical decision in the report. That's really a judgment for the commanders on the ground to make.

What we're saying in this report is we want to conclude this war. We want to conclude it in a responsible way. We want to handle it deliberately and carefully. We want to protect the American interests involved. And we certainly want to do it in a way that is consistent with the values of this country.

But make no mistake about it, this report calls us for beginning to conclude this war by transferring authority, combat authority, from the U.S. forces to the Iraqi forces. That's the best way to go forward that we can see.

Some people want to put in a lot more troops. Some people want to pull out troops immediately. We think the best way to go forward and still achieve the goals that you have is to begin to train very vigorously, very robustly the Iraqi forces to take over the fighting.

We do not want American forces involved in sectarian clashes and violence. That's not our business.

We do have some business there. And that's to get rid of Al Qaeda and the terrorists and, of course, to protect our own forces.

WALLACE: Gentlemen...

BAKER: And along those lines, Chris...

WALLACE: Go ahead, sir.

BAKER: Along those lines, Chris, we point out that there will be a robust American combat force in Iraq for quite some time to come. And we take note of the fact that there will have to be combat forces there for the training, equipping and supporting mission, as well as for force protection and Special Ops and rapid reaction forces and so forth.

WALLACE: Gentlemen, you predicted when you issued the report this week that you were going to take fire from both the right and the left, and you were not disappointed.

Let's talk first of all about this military side and the idea of getting most combat forces out within 15 months. Here's the reaction this week from Senator John McCain. Let's look.

SEN. JOHN MCCAIN (R-Ariz.): There's only one thing worse than an overstressed Army and Marine Corps, and that's a defeated Army and Marine Corps. And I believe that this is a recipe that will lead to sooner or later our defeat in Iraq.

WALLACE: Secretary Baker, given the fact that we have been trying to train up the Iraqi forces for the last three years and have been unable to do so adequately, what makes you think that we can get them to take the lead combat role in the next year? And wouldn't the U.S. trainers who were embedded in the Iraqi units, according to your plan, wouldn't they end up as being extremely high value targets?

BAKER: Well, we don't think so, Chris. And the reason I think it will work along the lines — in the way that we've laid out is that we are — we are suggesting changing the primary mission of U.S. forces there. It has — the training of Iraqi forces has been a secondary or tertiary objective. We've only had about 4,000 troops committed to that process. We suggest a five-fold increase, up to 20,000. We suggest changing significantly the way it's done, using our very best people, incentivizing them to a greater extent, and embedding them all the way down to the company level.

Now, there's a lot — there is a Pentagon study going on, as you point out, and there's a lot of support, I think, in the Pentagon for something similar to this. I don't know whether that's where the Defense Department will come out, but it's certainly not an unreasonable approach.

WALLACE: Let's turn if we can, gentlemen, to the diplomatic side of this. You call for a new diplomatic offensive, specifically including trying to engage Iran and Syria.

Now, the day after you released your report, President Bush talked about this in his press conference with Prime Minister Blair, and he said he would be willing to see those countries come to the table if they understand their responsibilities to stop funding terrorism and to support a new democracy.

Let's take a look at what the president says.

PRESIDENT GEORGE W. BUSH: If they want to sit down at the table with the United States, it's easy. Just make some decisions that will lead to peace, not to conflict.

WALLACE: Congressman Hamilton, is that the kind of unconditional engagement that you call for?

HAMILTON: Well, as the president was quoted there as saying, that is, they have to come seeking peace, that seems to me reasonable.

WALLACE: How about the idea of stopping the funding of terrorists?

HAMILTON: Well, if you set a lot of pre-conditions, then I think you just don't have the talks between ourselves and Syria now — and Iran.

We are suggesting within the framework of the international support group, which is a lot of different countries, that we sit down and talk with Iran and Syria and other neighbors.

We say that because both of these countries have a very large influence in Iraq, and you're not going to be able to get the kind of support you need in the neighborhood for the steps towards peace in Iraq that is necessary.

We understand that the road to peace in Iraq begins and ends in Baghdad. That's the central action. Has to take place there. We also believe, however, that a lot of these countries in the region can stop doing things that they're now doing and can do things that they are not doing, which will greatly contribute to the atmosphere and the environment to achieve peace.

WALLACE: Secretary Baker, I want to ask you, and I have to tell you, I read your report in full this week.

In recommendation 15 of your report — let's put it up on the screen — you call for the — Syria's full cooperation with investigations into the assassinations of Rafik Hariri and Pierre Gemayel, assassinations which most people think that they ordered, and you also call for Syria to stop undermining the government of Lebanon.

A number of critics this week have said that that is naive and better suited to the Mideast back of 1991 when you were secretary of state.

BAKER: Well, I understand that, Chris, and back in 1991, a number of people said, hey, you'll never be able to change Syrian behavior and get them to come to the table to negotiate peace with Israel. And after 15 trips to Damascus, we were able to do that.

So it's no answer, to my way of thinking, to say that because it's tough, we don't do it.

We laid all those requirements out there because we wanted everyone to know we're not naive enough to think that we're just going to go sit down and talk with the Syrians just to be talking to them.

If they were to do all of those things we list there, it would cure Israel's Hezbollah problem. It would give Israel a negotiating partner with the Palestinians by getting Hamas to acknowledge Israel's right to exist.

So let me say one thing generally about the — those two issues, that is, talking to Iran and talking to Syria, Chris. These are very limited proposals. With respect to Iran, all we suggest doing is what we did with Iran, this very administration did with Iran in Afghanistan, where they came in and they helped us. And we even go so far as to say that based on our limited contacts with the government of Iran, authorized by the president, we don't think that they will come and sit down, but we ought to hold them up to global public scrutiny, if you will, for their rejectionist attitude if they refuse.

With respect to Syria, that whole long list of things that evidently you put up on your screen there, are the things that we would expect to get from Syria. If we got those, that would be a major step forward toward peace between Arabs and Israelis.

WALLACE: Secretary Baker, we have got less than a minute left. If the president were to ask you to undertake this new diplomatic offensive, would you?

BAKER: He won't, and that's a hypothetical, and I don't answer hypothetical questions.

WALLACE: But if he did?

BAKER: That's hypothetical. And he won't.

WALLACE: I mean, that's a non-denial denial...

BAKER: And I don't answer hypothetical questions.

WALLACE: ... Secretary Baker.

BAKER: Hey, hey, nice try, Chris. Nice try.

WALLACE: Well, listen, we worked together for about 25 years... I was covering you in the Reagan administration, and you know, old habits die hard.

BAKER: That's right.

WALLACE: Secretary Baker, Congressman Hamilton, we want to thank you both so much for coming in today and discussing your report.