The following is a partial transcript from the Dec. 24, 2006, edition of "FOX News Sunday With Chris Wallace":

"FOX NEWS SUNDAY" HOST CHRIS WALLACE: As we head into a new year, we want to get some insights from one of Washington's most original thinkers, Lynne Cheney, wife of the vice president.

And, Mrs. Cheney, welcome back to "FOX News Sunday."

SECOND LADY LYNNE CHENEY: Well, thank you, Chris. I appreciate that compliment.

WALLACE: Well deserved.

As 2006 wraps up, I was thinking the other day that you and your husband and the Bushes all have just two years left in these very powerful positions that you have. Do you all feel a sense of mission to get as much done as possible before you leave office?

CHENEY: Well, you know, I think there's a sense of mission that's been there from the beginning, and particularly since September 11th, to keep this country safe, to set this country on a path for a very long struggle — you know, we're just at the beginning of what's going to be a very long struggle — but to set this country on a path to keep our children and our grandchildren safe.

So I think that mission has been there for a very long time and continues still.

WALLACE: Do you feel, though — I mean, are you aware of the fact two years left and time is running out in this lifetime to do things?

CHENEY: You know, I've discovered, too, that as you grow older, time passes so quickly; it is just unbelievable to me that Christmas is almost upon us and 2007. And so, of course, you have the idea of time growing short.

But I don't think that there's a fundamental change in mood. I think the sense of mission has been there all along.

WALLACE: Well, let's talk about that, because obviously the big issue now is to come up with a new strategy for Iraq.

Knowing that some of the decisions that have been made have not worked out, does the vice president feel any extra pressure, knowing that this may be the last chance that he and the president get for a course correction in Iraq?

CHENEY: You know, I think Dick wakes up every morning — and I suspect the president, too — determined to do the job he has to do as well as he can. And I certainly, living close to the vice president, don't have any sense that he feels under pressure. But he feels the same commitment and determination that he always has to do this really important job as best he can.

WALLACE: How do you feel about the challenge of working with a Democratic Congress for the next two years?

CHENEY: Well, you know, the president has said — and I know the vice president agrees — that the idea is to go forward and to cooperate, to reach across the aisle, to make common cause in as many ways as possible.

That's clearly what the American people want. They don't like the idea that there are these huge problems out there and that all we do in Washington is fight about them.

But, you know, I, personally, have the sense that there are also some bright lines that we have, over the past five, six years, as a country, set in place some policies that have kept us safe. I'm thinking of the terrorist surveillance program and the Patriot Act and the detainee policy. We've begun to set in place policies, we've begun to develop instruments for ourselves to keep this country safe.

And I suspect there are some bright lines there. You have seen the Democrats consistently batter these programs and argue against them, and I think that it's not probably in the nation's interests, and I'm sure it is not on the president's agenda or the vice president's, to let any group in this country strip those tools away that have kept us safe.

WALLACE: Do you worry that the new Democratic majority might try to undo some of those things?

CHENEY: Sure. I think that that will be part of the ongoing effort in Congress, as we move forward, to come to grips with that, but to be sure that those things are kept whole so that we are safe and secure.

WALLACE: You used to be — before you became the second lady, or whatever you title is, of the land — on this side of the chair. Why do you think the Republicans took a thumpin', as the president put it, in the election? What do you think the American people were trying to say?

CHENEY: Well, I think Iraq was part of it.

But I also think that you had some extraordinary ethical failures. They were bipartisan, but I do think the Republicans paid a great price for that: the Mark Foley scandal at the end, things like the Duke Cunningham scandal at the beginning. I think those exacted a terrible price.

And you've also got the fact that in the sixth year of an administration, this is pretty typical.

WALLACE: You were nice enough to invite my wife and me to one of your Christmas parties — and thank you very much for that — and I couldn't help but notice that one of the other guests at the party was Scooter Libby, the vice president's former chief of staff.

What is the Cheneys' relationship with Scooter Libby now?

CHENEY: Oh, Scooter is a friend. He is someone that we admire. He is someone who has served the country very well. He's a fine man.

WALLACE: What about all his legal problems?

CHENEY: Well, the legal problems are there. I don't want to comment on anything in specific because there is a trial coming up.

But Scooter is a fine man. And we continue to support him and his wonderful family. He has a terrific wife, two great kids.

WALLACE: And those legal problems, it seems, have not changed your opinion and your admiration of him.

CHENEY: That's exactly right.

WALLACE: I'm going to ask you a question; you can answer it or not answer it.

Given the fact that it now turns out that Libby wasn't the one who first leaked the name of Valerie Plame, the CIA officer, what do you think of the fact that he's the only person who's being tried?

CHENEY: It seems bizarre to me.

WALLACE: In what way?

CHENEY: Well, that's the — I did answer your question.

WALLACE: I'm surprised you answered it that much.

CHENEY: Let's just stop there. I think it's bizarre.

WALLACE: That he's the only who's being tried?

CHENEY: Well, I just think — I think that we're seeing an instance of a man who spent a great deal of his life as a dedicated public servant — he's done an awful lot of good — in a situation that does not reflect well on our judicial system.

WALLACE: In addition to everything else you do, you have written five books about American history for children and families. And the latest one, which we just happen to have right here, is called "Our 50 States" which is written — and I love this about it — as a kind of family road trip across America's 50 states. And I hate to admit it, but I learned a lot in looking through it.

Why do you think it's so important for young people to have what you call historical literacy? And do you push that yourself, and have you pushed that yourself, with your children and your grandchildren?

CHENEY: Well, I think it's important for one reason: They need to understand what a great and good country this is.

We spend an awful lot of time flailing ourselves, in the media particularly, finding our sins, finding our errors, finding our flaws and faults, and those are by far the smaller part of the story.

This is a great and good country. And we need to show our kids that. We need to teach them that.

You can do it by, you know, going to some place close by that might tell the story of the pilgrims, or the Puritans, or I think of the pioneers in Wyoming, you know, the heroic story of those people who came across the plains, taking the Missouri trail, you know, in ox carts. It was — it's an amazing story. And we have many stories like that.

And I certainly do push it with my own grandchildren. Just this last week, I went to Mount Vernon with the three older grandchildren. They have a new educational center there that's quite spectacular.

The story of Washington is one that they should all have engraved on their frontal lobes. And taking them to Mount Vernon is a good way to start that.

WALLACE: Well, let me ask you about that, because how do you make it fun and not like eating spinach?

CHENEY: Well, one of the ways you do it is you connect it with the time. And the story of Washington is such a good one to tell now, because one of his most amazing accomplishments was crossing the Delaware.

WALLACE: Which happened on Christmas, I remember.

CHENEY: Exactly. Everything is lost and Washington decides to go on the offensive, and on Christmas night crosses the Delaware, defeats the Hessians, goes on to Princeton and defeats the British.

He really lifted the souls of everyone across America with these heroic deeds.

WALLACE: Well, speaking on grandchildren, we — it's been well publicized that you're going to have an addition to the Cheney family. You're daughter Mary is going to give you I think your sixth grandchild?

CHENEY: That's exactly right.

WALLACE: What do you make of all the fuss about this?

CHENEY: Well, I think that it's just very lucky for me that I enjoy being a grandmother and I get to do it for the sixth time. And we're very much — Dick and I both very much looking forward to this new baby.

WALLACE: And your thought about Mary being a mother?

CHENEY: Well, she'll be a great mom. She really will.

WALLACE: The last time that you were here, two years ago, we talked about the whole issue of Christmas and political correctness. And the debate continues on two years later. This year we have the controversy over putting up Christmas trees in Seattle airport; as I'm sure you know the department store chains are taken to task as to whether to say "Merry Christmas" or "Happy holidays."

What's the right answer, here?

CHENEY: You know, I personally look for those messages in my Christian faith that are pretty universal, and try to wish those to all my friends during Christmas.

One of the aspects of the Christian holiday, Christmas, is the message of the angels, "Peace on Earth, goodwill to men." What message could be more fitting for people everywhere than that? So the president — the vice president and I have that on our Christmas card this year.

WALLACE: But this whole issue of saying, "Merry Christmas," or being — conversely, being embarrassed to say, "Merry Christmas" — what's right?

CHENEY: Well, you should say, "Merry Christmas," if that is what feels good to you. However, if you're talking to somebody Jewish, it seems to me that "happy holidays" is probably more appropriate.

And when you have a large audience, as the Bushes do, or as we do when we send out our Christmas cards, I think you try to find something in your faith that has universal meaning that will touch every heart, and to make that the basis of your Christmas wishes.

WALLACE: As something of a social commentator, you've certainly heard people talk about the war against Christmas. Do you think there is a war against Christmas?

CHENEY: I do think that's true. I do think that's true.

You know, it's something we have a little trouble with in this country: We talk about diversity, but sometimes we seem completely brain-dead to the fact that you can be diverse, that you can have a menorah and you can have a Christmas tree. You don't have to quit having the Christmas trees, quit having the creches, in order to honor a Jewish holiday, in order to honor people of other faiths.

WALLACE: So celebrate it all?

CHENEY: Exactly.

WALLACE: Finally...

CHENEY: We had a menorah at our Christmas party.

WALLACE: I didn't notice — I noticed Scooter Libby, I didn't notice the menorah.


WALLACE: Finally, there are hundreds of thousands of Americans this Christmas — as there have been for many Christmases — serving around the world defending freedom. Mrs. Cheney, do you have a message you'd like to send to all of them?

CHENEY: Oh, my goodness: Just such complete gratitude.

It's been one of the most inspiring things that I've had the opportunity to do, being married to the vice president, is to visit our troops at various places around the country. And I want to thank those that are serving overseas for their service. I know they do it as volunteers. I know they do it because they feel as though they're serving a larger cause.

And it is such an important one. It is a cause that we've always needed to have defended. We've had great warriors from the beginning of our history, brave soldiers that we've honored. And I honor those who are serving today.

WALLACE: Well, Mrs. Cheney, we thank you so much for joining us. Merry Christmas and a happy new year to you and all the Cheneys, including that new grandchild on the way.

CHENEY: Thank you very much, Chris.

WALLACE: Thank you so much for coming.

CHENEY: Merry Christmas, to you.

WALLACE: Thank you.