This is a partial transcript from "Hannity & Colmes," July 31, 2006, that has been edited for clarity.

ALAN COLMES, CO-HOST: Earlier today, Senator John Kerry gave a major address on reforming America's health care at historic Faneuil Hall in Boston. And after that, we sat down and spoke.


COLMES: Why this issue and why now?

SEN. JOHN KERRY, D-MASS.: This issue is a critical moral issue for America because it affects so many people and all of us together. It is a critical economic issue, because our businesses are just being burdened increasingly by the cost of healthcare.

COLMES: What happened last time? When Bill Clinton was president and there was an attempt to get national health care, why didn't that work?

KERRY: It didn't work, because I think there were too many different pieces of it. It was too much of a government plan. And people resented the intrusion of government into their lives.

My plan — incidentally, I was not a sponsor of that plan. I believed we needed to find a solution more in keeping with what I'm offering now. My solution is a market-based, free choice. You choose where you want to go.

But we create a marketplace with incentives, which we do all the time in America, that helps people to make a better choice. We have an incentive for preventive care. We have an incentive for people to take part in the program itself. But again, no one is forced to do anything they don't want to do.

COLMES: You have said that if you had been elected president, what's happening in the Mideast today would not be happening. What would be happening and how can you be sure that President John Kerry would not be presiding over the kind of conflict we're seeing?

KERRY: What I was talking about, Alan, which should not be distorted, is Iraq and the impact Iraq has had on the Middle East and the lack of diplomacy and involvement by this administration for several years. I'll give you a huge example.

For three years or more, this administration did not engage with France, Great Britain and Germany in the effort to keep Iran from having nuclear weapons. And our absence from that had a profound impact on their attitude.

In addition to that, the management of the war in Iraq has been such a disaster that this administration has lost credibility. I said again and again, I would not have gone into Iraq the way President Bush did, if I had to. I would have done that very differently, and our leverage, we would have a great different — a great deal more leverage in the region that we have today.

Obviously, I can't tell you that Hezbollah wouldn't do something bad. I can't tell you that they were going to snatch a couple of soldiers. I'm not saying that.

What I'm saying is Iraq would have been profoundly different, and our engagement and diplomacy would have been profoundly different. And the attitude of the United States towards the countries in that region would have been different, and as a result, we would have greater leverage and greater ability to protect our interests.

COLMES: Has Israel overreacted?

KERRY: No, look, Israel was attacked. Israel had its soldiers kidnapped. What would we do if our soldiers were kidnapped? I think we would respond.

And Israel responded against an entity that is a terrorist organization, fully committed to its destruction without ever wavering from that statement. Now, when you've got thousands and thousands of rockets that are aimed at you, some of them coming into your country, you're ultimately forced to respond.

Now, had there occasionally been incidents, like the other day where it is regrettable for Israel, for everybody who is supportive of it? Of course. Obviously, that can hurt.

But what we need is the kind of sustained effort to focus on the real problem here, which are people who want to destroy the state of Israel and will not allow for its existence, and that has to change.

COLMES: Condoleezza Rice said she won't meet with Syria. She goes over there. And now the Lebanese prime minister says don't bother. What does the administration need to do to show the kind of leadership? Can the United States be the glue that brings this together and makes it happen?

KERRY: I think if the United States were to focus on Iraq properly, on the need to have countries come together and deal with the political diplomatic solution, you have to wind up talking somehow to these countries. You can't hope to advance the diplomatic process if you're not willing to talk to people.

So I think it's important to have those kinds of discussions, but obviously without ever wavering on our fundamental principles that we are supportive of Israel and it's clear why. And we are going to destroy those who will not change their ways with respect to terror.

COLMES: Should there be an immediate cease-fire?

KERRY: I think it is important to try to have a cease-fire. It has to be, as people have used the word, sustainable. It can't be a cease-fire where you're just advantaging people to arm and to come back and kill you.

So you have to have something that makes sense. I believe that means putting troops into the region in order to act as a buffer and working on the fundamental issue of Hezbollah, which means ultimately strengthening the Lebanese government itself and strengthening their ability to be able to separate from Hezbollah.

COLMES: What conditions would there have to be for you to decide, "I'm going to run again. I'm going to seek the Democratic nomination"? What would make you make that choice?

KERRY: Well look, it's down the road.

COLMES: Certainly, you're thinking there could be a confluence of events coming together that makes you decide once again I'm going to go for it?

KERRY: It's possible. I've been very — look, I'm not playing any game here. I am thinking very seriously about running, and I'm going to evaluate it as best as I can, but I'm not going to make a decision until after the November elections.


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