This is a partial transcript from "Hannity & Colmes," Nov. 11, 2004, that has been edited for clarity.

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ALAN COLMES, CO-HOST: Welcome to HANNITY & COLMES. I'm Alan Colmes… our top story tonight. After days of speculation, the word finally came last night.

Palestinian leader Yasser Arafat is dead. He died last night at a military hospital outside of Paris. And although Palestinian officials have not said exactly what killed him, the 75-year- old Arafat has suffered from numerous ailments.

Earlier today, his body was transported from France to Cairo for a funeral service that will — will then continue on to Ramallah in the West Bank, where he will be buried.

Will Arafat's death open a new line of dialogue between Israel and the Palestinians? Joining us now, former secretary of state, General Alexander Haig.

General Haig, welcome back to HANNITY & COLMES.

ALEXANDER HAIG, FORMER SECRETARY OF STATE: Thank you, Alan. It's good to be with you again.

COLMES: Thank you, sir.

Do you think — they're now asking for an autopsy, his doctor is. We didn't know, it was a mystery ailment. Do you think it's possible there was foul play here?

HAIG: Well, I seriously doubt it. One only had to look at Arafat over the last few years and know that the grim reaper was getting very close. He had a number of ailments, not the least of which was, as I read, a failed liver, and a liver just has to function in order to live.

COLMES: Dennis Ross, a former Mideast envoy, met with Yasser Arafat hundreds and hundreds of times, came up with some ideas about how we might capitalize on this point in history and says we should begin a dialogue with the Palestinian prime minister, get Europe involved, organize three- way discussions with the United States, Israel, and the Palestinians. Do you agree with all that?

HAIG: Well, I don't disagree with that. I think the passing of Arafat, and this is not the time to be hypercritical, but I'm one that believed always that he was a terrorist. And our recent president, our current president, is the only president in my lifetime who called him that.

And so, I think it's now very evident that after the eight years of Bill Clinton, where some nine proposals between President Bush I and the Clinton administration were all rejected by Arafat. And that included even an almost total agreement to give them everything he demanded at the Taba meeting during the Clinton administration.

So he was a fellow that didn't really want peace. He wanted the destruction of Israel.

COLMES: You know...

HAIG: That happens to be the same line as the Iranian fundamentalists are taking.

COLMES: President Bush cut off relations with Arafat a couple of years ago, didn't want to talk to him, didn't want to negotiate with him. Was that a mistake, or could we have used these couple of years to advance peace?

HAIG: We would never have advanced peace. As I told you, there were nine separate proposals rejected by Arafat during the period after the Gulf War with former President Bush, and all of the Clinton years.

Everything was rejected by none other than Arafat. Why? Because he didn't want peace; he wanted the destruction of Israel. That's the same position that Iran is taking today in the fundamentalist upheaval we're confronting in Iraq.

COLMES: What should President Bush now — how should we capitalize on this moment in history?

HAIG: Well, what we should see now is that, thanks to the initiative of the Israeli government, which is to disengage, and also the position of President Bush to offer a statehood status for the PLO, we have a situation with Arafat off the scene where there should be a renewed effort.

But all of this is going to be affected by the struggle in Iraq and the future attitude of Iran, which has been so heavily behind the fundamentalist movement.

SEAN HANNITY, CO-HOST: All right, Al, let me ask — By the way, welcome back, Mr. — Dr. Haig. Good to see you. Thank you for being with us, Mr. Secretary.

You know, I am — I'm quite annoyed at what — how the world is reacting. Because he was a terrorist. He is a terrorist. He died a terrorist, and yet you listen to, you know, the chancellor of Germany saying, well, he hasn't completed his life work. I mean, what was that, pushing Israel into the sea?

Or Jacques Chirac saying, he's a man of courage and conviction. He wasn't a man of courage and conviction. He was a murderer and he was a terrorist.

Why are so few people in the world willing to call this for what it is?

HAIG: Well, it's always been a case of the perpetrator of terrorism being equated morally with the victim of terrorism. We've done that ever since the 40 years of Arafat's influence on the PLO.


HAIG: Now, this is behind us. And therefore, I have a certain measure of guarded optimism that the opportunities now do exist for resumption of the effort.

HANNITY: But how is it...

HAIG: But it isn't going to be the same effort. It won't be the same effort. We don't need a partner under the disengagement solution that the Israelis are now putting in place.

HANNITY: The only one I think that had guts — and you're right, George Bush and then Rudy Giuliani when he snubbed Arafat back some years ago here in New York, you remember. He was the one who had courage, too.

Look, I want to believe all that. But here's the problem, as I see it, General Haig, is that I look at Arafat, and he invited Islamic Jihad; he invited Hezbollah, Hamas to the table. And the only person that's going to get that seat is somebody that similarly will allow them that seat also at the table.

So what real hope is there going to be here? Explain to me how those people are just going to go away willingly? I don't see that happening.

HAIG: Well, it's not without obstacles. There's no question about it. And we're going to need, not three powers, but the quadra system we had, which included Russia and included the European Union, the United Nations and the United States, working together to try to understand that once and for all, that it's a new situation.


HAIG: And that new situation is going to involve getting rid of the multitude of terrorist groups who are quasi-independent under the Palestinian movement today.

HANNITY: All right. But that...

HAIG: We have to get rid of them and have one government.

HANNITY: But — but, General, what you're saying here is win the war. You've got to defeat them. You can't invite or have Hezbollah, Hamas, or Islamic Jihad at the table.

You're either going to elect a leader that really wants a peace — and Ehud Barak offered everything, and it was rejected — or you're not going to have a peace. You've got to win and defeat them.

Is that the recognition that the world's going to have to come to one day?

HAIG: No. They have been defeated pretty consistently by Israel and with the support of the United States in materials — in a material and psychological sense.

But today we have to have the Palestinian movement itself understand that with Arafat off the scene, a new government with fair elections has to be established. And they have to get control of all of the instruments of military power now under the Palestinian label.


HAIG: And that includes Hezbollah, Hamas, and the rest.

HANNITY: What do we do with Iran when they're now a potential growing nuclear threat? We know what Israel did to Iraq's nuclear capability in the early '80s. There was worldwide condemnation. How do you deal with it?

HAIG: You're going to have to deal with it with a degree more firmness than we've been able to muster so far. And we've got to do it with the allies, those of us who are all concerned...

HANNITY: The friends (ph).

HAIG: ... about the proliferation of nuclear weapons. And that includes our European friends. And it doesn't mean that it serves any useful purpose to be throwing stones at them. We've got to sit down and talk to them.

COLMES: We thank you for being with us tonight.

HAIG: Their interest coincides with ours.

COLMES: Good to see you.

HANNITY: Thank you, General.

COLMES: Thanks for being with us.

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