This is a rush transcript from "Hannity," February 25, 2011. This copy may not be in its final form and may be updated.

TUCKER CARLSON, GUEST HOST: The gruesome crackdown continues against anti-government protesters in Libya. In a speech broadcast on state television earlier today, Libyan strong man Muammar Gaddafi told a crowd of supporters in Tripoli Square to fight back. He said, they should retaliate against the opposition and to, quote, "prepare to defend the nation and defend the oil." In response to the growing violence in Libya, White House Press Secretary Jay Carney said the U.S. is finally moving forward with plans to impose sanctions.


JAY CARNEY, WHITE HOUSE PRESS SECRETARY: Consistent with the president's tasking to the government to prepare options to hold the Libyan government accountable for its violations of human rights, we have decided to move forward with unilateral sanctions which we are in the process of finalizing; coordinated sanctions with our European allies and multi-lateral efforts to hold the Libyan government accountable through the United Nations.


CARLSON: Joining me now with reaction is the ongoing crisis, former U.N. Ambassador John Bolton. Ambassador, thanks for joining us. You just saw that clip. I'm getting the impression day after day that after this administration doesn't really have any clue how to respond to the unrest in the Middle East. Is that your impression?

JOHN BOLTON, FORMER U.N. AMBASSADOR: No, I think these people make the Keystone Kops look organized. In the case of Libya, you know, we have apparently have now gotten the bulk of the American citizens in that country out safely after delays and foul ups with ships and so on that really left them very much at risk until they were finally extracted. The demonstrations in the Middle East have been going on for over a month. You think we didn't have time to plan to get military assets nearby, so we could have taken care of a non-permissive evacuation or begun to plan against the kind of contingency we are seeing now. And our big effort is to go to the U.N. human rights council and suspend Libya from membership. Really, this is incompetence of the worst kind and it left Americans at risk. Hopefully, with the bulk of them out, that risk is minimized. But it could have been, it could have been, very, very bad.

CARLSON: So, I'm sort of losing track as to what the U.S. policy is on the democracy question. For the last maybe 10 years, we have heard about the merits of democracy and the democratic people are not war-like. And it's always good for the world and good for America when countries become democratic. Is that true, do we think, is it always better for America and for its allies for countries to become democratic? Is that still the position of the United States government?

BOLTON: Well, I think if you had democracy, in the sense of democracy as a culture way of life, not simply democracy as in finding a way to hold elections. Just because there is turmoil in a region doesn't mean it is going to end up in a better situation. Libya is a perfect example. You could well see this degenerate into civil war. In fact, I think that ought to be the contingency that we are planning for now that the administration shows no signs of understanding. Because if the government itself collapses and we end up with effectively tribal warfare, you could see Somalia on the north coast of Africa. Meaning that in a country of -- without governance, effectively, terrorist could take root. So, that ought to be what we are worried about next. Although, I don't see any sign that the Obama administration is even thinking about that.

CARLSON: And yet, unlike Somalia, Libya has large proven oil reserves. And their future affects us directly. If unrest there and in other countries in that region lead to say, $5.50 gallon oil, that hurts the United States, that hurts our economy, gravely. Are we prepared to do anything about that, can we?

BOLTON: Well, it doesn't seem like we thought ahead to that contingency as well. You know, for what it is worth in terms of the potential loss of Libyan oil, the Saudis, you know, ruled by a monarch and so on, have begun to take contingency plans to increase their production. I was just out in the gulf region, and I think there's great concern that the United States doesn't seem to have its act together here. The fall of Libya into chaos would be a bad thing for oil prices. The loss of Saudi Arabia, Kuwait, Qatar, the United Arab Emirates, would be catastrophic from the economic point of view and in terms of the daily lives of every American, it would have an enormous and utterly negative impact.

CARLSON: Yes. Not enough win power to make up for that. No question about, I want to ask you about a story that hasn't got enough attention, in my view. A couple weeks ago, a U.S. embassy employee in Pakistan was robbed, the victim of an attempted robbery by two men on the street. I think in (INAUDIBLE) Pakistan, he pulled out his side arm and shot them both. He was subsequently arrested. He has diplomatic immunity. He is in jail. Last week, the administration told reporters that this guy was a CIA employee. In my view imperiling his life. Two questions, one, why did they Plame him, and why haven't reporters said more about it? And two, why is the U.S. government allowing an American with diplomatic immunity to languish in a Pakistani jail?

BOLTON: You know, those are questions that have no answer. I don't understand this administration's foreign policy. Actually, I do, I don't think they have one. And this is a good demonstration of it, that individual if he is in the CIA was there helping to go after the Al Qaeda and Taliban elements that are holed up inside Pakistan. And for the Pakistani government to toy with this man's life and not to find a way to declare him persona non grata, get him out of the country, whatever, really is the worst kind of pandering. And I think it shows that despite the fact the administration early on identified stability in Pakistan as a critical American interest, one that we haven't paid enough attention to, it has wandered all over the lot since then as this case demonstrates. I'm very worried for what it says about our underlying policy in Pakistan and the risk of instability there that could see Pakistan's substantial arsenal of nuclear weapons fall into terrorist hands.

CARLSON: But what does it say about us? We are allowing an innocent American citizen with diplomatic immunity just to languish with the death penalty hanging over his head and we do nothing. How weak does that make us look in the eyes of the world? It's pathetic.

BOLTON: Well, you know, we don't want to offend anybody. We don't want to do that. That sounds too much like the Bush administration, but what it sends is a signal of weakness not simply to the Pakistani government but to others.

I think it's also the same sort of thing in what we've done in Libya. We are so afraid of offending Gaddafi that our citizens were very much at risk in the port of Tripoli.

There are thousands of people in the airport there who can't get out and what are we doing? Going to the U.N.

CARLSON: Pathetic. Ambassador John Bolton, thanks for joining for us. I appreciate it.

BOLTON: Thank you.

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