This is a rush transcript of "Special Report With Bret Baier" from June 4, 2009. This copy may not be in its final form and may be updated.


PRESIDENT OBAMA: This cycle of suspicion and discord must end.

I've com e here to Cairo to seek a new beginning between the United States and Muslims around the world, one based on mutual interests and mutual respect.

And I consider it part of my responsibility as president of the United States to fight against negative stereotypes of Islam wherever they appear.



BRET BAIER, "SPECIAL REPORT" HOST: The president in Cairo. The White House billed this speech as a major address to the Muslims of the world. It lasted a little over 55 minutes, was 6,000 words. Words that you did not hear in the speech, "terror," "terrorist," or "terrorism," although the president did talk about the 9/11 attacks and a lot of other topics.

We have a lot to talk about. Let's bring in the panel, Steve Hayes, senior writer for "Weekly Standard," Mort Kondracke, executive editor of "Roll Call," and syndicated columnist Charles Krauthammer.

Charles, let's start with you.

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Well, the damage in policy was rather small. The damage to our position philosophically was large.

On policy, the damage was small because the speech was so abstract, vapid, and self-absorbed that it didn't touch a lot of policy, except on Iran, where he was exceedingly weak.

That was the weakest statement on Iran and nukes in at least eight or nine years by anyone in the West. It spoke about our demand that it not develop a nuclear weapon as a kind of a misunderstanding over a treaty.

But the real damage is philosophical. There was, once again, over and over again apologies and moral equivalence. At the beginning, he apologizes for colonialism and imperialism. The United States was never a colonial power or even the holder of the League of Nation mandate in the Arab or the Muslim world.

And then he goes into the moral equivalence. I will give you one example. He speaks about, with Iran, how, on the one hand, we had a hand in a coup in 1953, and on the other hand, they have been involved in some nasty stuff over the last 30 years.

So on the one hand is American involvement in an action by Eisenhower executing a Truman plan 55 years ago. On the other hand, you have 30 years of ongoing terrorism against the United States and the world, the taking of hostages, the proxy killing of Americans in Iraq and elsewhere, the developing of nukes, and the threatening of allies with nuclear weapons. So these are to be balanced.

One other example, if I can. On women's rights, a very oblique reference to the oppression of women in the Muslim world, and on the other hand, he says — he can't help himself. He has to find something in us he has got to attack. He says the struggle for women's equality continues in many aspects of American life.

So on one hand, you have got a university somewhere where the women's lacrosse team is not getting the full funding under Title 9. On the other hand you get women beaten in the street in Saudi Arabia who show an ankle or stoned for adultery in Iran.

It is not exactly morally equivalent.

BAIER: Charles is fired up — Mort?

MORT KONDRACKE, EXECUTIVE EDITOR, "ROLL CALL": I do not agree that this is moral equivalence.

I think what Obama is doing, and he does this often, is a lawyerly exercise where he identifies with the views of the people that he is talking to in order to make a point about — that he also wants to make. And there is balance, but I don't think it's moral equivalence.

He is trying to get an argument across, trying to create a new impression of the West, and especially of the United States, among especially Muslim youth who have been propagandized over and over again by Al Jazeera, and had all kinds of negative stereotypes created. Now, I agree, he went very light on Iran, and especially on Iran's support of terrorism.

BAIER: He didn't even mention it.

KONDRACKE: In fact, in Egypt itself, the Egyptian government just rounded up 49 Hezbollah terrorists who were plotting to try to overthrow the government of Egypt itself, and along with some Revolutionary Guards who were their leaders.

Furthermore, Hezbollah is about to take over the government of Lebanon with Iranian support.

BAIER: He didn't mention Lebanon.

KONDRACKE: The whole Arab world is scared to death of Iran. He should have found a way to exploit that more than he did, to identify the United States as trying to resist this imperialism on the part of Iran.

BAIER: Steve?

STEVE HAYES, SENIOR WRITER, "THE WEEKLY STANDARD": On Iran, two things. In the interview that he gave leading up to the speech, he had a moment where he said Iranians feel embattled about their nuclear program, and almost seemed to take their side in going so far and identifying with them, which I thought was irresponsible.

Then in this apology for the coup, or recognizing America's role in the coup in 1953, this was something that Mahmoud Ahmadinejad asked the United States to apologize for after Barack Obama had initially given a statement for Nowruz.

Now, that is going to be read in Iran as Barack Obama doing what Ahmadinejad wanted him to do.

I think for taking a broader view of the speech, the biggest problem with it was with what wasn't in it, and particularly Iraq. What he didn't do in this speech was recognize what Iraq has become. He said in passing, he mentioned Iraq's democratically elected government...

BAIER: To make it a better Iraq, is what he called it.

HAYES: Right.

BAIER: Not democracy. He didn't mention that. He said a "better Iraq."

HAYES: None of that. He said none of that. He mentioned Iraq's democratically elected government only to make the point that he was keeping his campaign promise to withdraw U.S. troops.

Now, Iraq is in many ways in the region the exhibit of the kinds of things that he is talking about bringing to the region — democracy, women's rights, religious freedom. Those are the things that they have imperfectly in Iraq, but they have them. For him not to recognize that I thought was appalling.

BAIER: There were a lot of applause lines built into this speech, Charles. And we will talk about the Middle East peace process in the next segment, but...

KRAUTHAMMER: The easiest way to get applause anywhere around the world is to attack the United States. And if you are a president, you will get loud applause, and he basked in it.

The problem is we are in a War on Terror, we are in a struggle against Iranian nukes. We are also in a struggle of philosophy between our way in the West and the more extreme examples of Sharia law. And if you don't defend them unequivocally and without apology and without moral equivalence, you are conceding defeat in advance.

BAIER: The president did have some tough things to say about Israel during that speech. The panel weighs in when we come back.



PRESIDENT OBAMA: So let there be no doubt. The situation for the Palestinian people is intolerable, and America will not turn our backs on the legitimate Palestinian aspiration for dignity, opportunity, and a state of their own.


The only resolution is for the aspirations of both sides to be met through two states where Israelis and Palestinians each live in peace and security.



BAIER: The president in Cairo talked at length about the Israeli-Palestinian situation. He did defend the legitimacy of Israel as the Jewish homeland, but did not mention the words "Jewish state." He talked a lot about the plight of the Palestinians.

Let's bring back our panel. Steve, your thoughts on this?

HAYES: Well, earlier Charles said that one of the easiest ways to get applause is to criticize the United States. The same, obviously, can be said in that part of the world criticizing Israel. So he got a lot of applause because there was a lot of criticism of Israel in his speech.

And I think, going back to what we were talking about earlier, about moral equivalence, I think that that was in evidence in a significant way in that part of his speech where he addressed the Israeli-Palestinian dispute.

I mean, he talked about — he went through in detail about the Holocaust, and chided, I think, Ahmadinejad and others for denying that there was a Holocaust, which was welcomed. But then said — followed it up literally by saying "on the other hand," and talked about dislocation of Palestinians. You can't read that as being anything other than moral equivalence. And I think it's deeply troubling.

BAIER: Mort?

KONDRACKE: Look, he said that there is an unbreakable alliance between the United States and Israel. He said that the Palestinians, in pressing their cause, should not resort to violence, including Hamas — good luck.

But he also said that this is a legitimate Jewish homeland. He denounced anti-Semitism, denounced Holocaust denial.

You know, I think that this is clear that the United States is still allied with Israel. What we want them to do is stop settlement activity and accept a two-state solution in the end. And this speech was an attempt to advance that cause.

The one big missing ingredient, the crowning missing ingredient in this entire speech, was any mention of Anwar Sadat. This is the 30th anniversary of Anwar Sadat, in Cairo, making peace with the Israelis.

He should have said Anwr Sadat is a model for the entire Islamic world, especially the Arab world. Saudi Arabia, do what Anwr Sadat did.

BAIER: So 6,000 words, why didn't he do it?

KONDRACKE: Well, I do not know. I do not know. I think it is a crushing error on his part.

KRAUTHAMMER: Because it would support the notion of Israel as a seeker of peace, which would not have gotten him applause. He didn't mention either Israel's acceptance of the partition in 1947, which the Arabs rejected, or the offer Israel had made in Camp David nine years ago of a Palestinian state. Arabs rejected it.

Or the offer that Ehud Olmert made in December of '08 to Mahmoud Abbas, also rejected, no mention of that at all.

And this appalling moral equivalence of, on the one hand, the Holocaust, and on the other hand dislocation, Arab dislocation, as he said, at the birth of Israel.

First of all, it is obscene to make a moral comparison between the genocide and dislocation. Second of all, the dislocation of the Arabs did not occur at the birth of Israel. It occurred as a result of the invasion of Israel at its birth by Egypt, Syria, Lebanon, Iraq, and Trans-Jordan, and Palestinian irregulars.

It was in that war, which the Arabs lost, intended to expel and destroy Israel, in that war that was lost when the Arab refugee issue was created. That's the history he left out. It was a selective history, and I thought it was extremely, sort of unfairly presented.

BAIER: We have the public statement from Israeli officials, but privately, how do you think Israel reacts to this speech, Charles?

KRAUTHAMMER: With shock. There was a gratuitous attack on Israel over its settlements.

The only concrete element of the entire speech on the Arab-Israeli dispute, an attack on Israel over a irrelevancy, the thickening of settlements, which is not a major issue in the peace process, and the undermining of the Israeli narrative in pretending that the creation of Israel was the result of the holocaust.

Zionism started at least 100 years earlier, and all of that is left out.

BAIER: Mort, we talked a little in the break about another thing that what was left out when he talked about head coverings, the hijabs.

KONDRACKE: He mentioned three times protecting the right of Muslim women to wear the hijabs, head scarves. He never mentioned the possibility, as Rob Satloff of the Washington Institute on Near East Policy pointed out, not to wear hijabs or not to live under Sharia law, and stuff like that.

As a matter of fact, a bigger point is that he said that an Arab regime could be acceptable, I mean, a Muslim regime could be acceptable, if it lives in peace and respects the rights of its citizens. But that allows the possibility of living under Sharia. Sharia is a religious law. In places it is very restrictive. And he seemed to think that that was just fine.

BAIER: Steve, will this speech be remembered for what was said or what wasn't said?

HAYES: I think it will be remembered for what was said to the audience he delivered it to today, specifically. But over here, I think we are likely to remember it for what wasn't said.

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