This is a rush transcript of "Special Report With Brit Hume" from August 11, 2008. This copy may not be in its final form and may be updated.


BUSH: Russia's actions this week have raised serious questions about its inte ntions in Georgia and the region. These actions have substantially damaged Russia's standing in the world. And these actions jeopardize Russia's relations with the United States and Europe.

It is time for Russia to be true to its word and to act to end this crisis.


BAIER: President Bush late today talking about the situation on the ground in Georgia.

Late tonight, a senior U.S. official calls it "an invasion by Russia," also says "We hope for a diplomatic resolution, but it is a grim situation," and U.S. officials cannot officially say whether Russian troops are moving to the capital of Tbilisi.

Russia's president and Georgia's president weighed in on the situation as well.


DMITRY MEDVEDEV, RUSSIAN PRESIDENT: The Russian peacekeepers will take all necessary measures to defend the lives of Russian citizens.

MIKHAIL SAAKASHVILI, GEORGIAN PRESIDENT: We are in the process of invasion, occupation, and annihilation of an independent democratic country. We are basically seeing pre-planned, cold-blooded, premeditated murder of a small country.


BAIER: There you see all the sides in this.

Some analytical observations about what is going on from Fred Barnes, Executive Editor of "The Weekly Standard, Jeff Birnbaum, columnist of "The Washington Post," and syndicated columnist Charles Krauthammer, FOX News contributors all.

Charles, we'll start with you. When you hear the senior official in this administration calling it a grim situation and you hear the two sides, what do you think is developing on the ground?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Well, obviously it's beyond our control. The Russians are advancing. There is nothing that will stop them. We are not going to go to war over Georgia. We were unprepared and the Georgians were unprepared.

The question is what can we do? The battle will end when the Russians have achieved whatever is their objective. Obviously, it starts with taking over of South Ossetia, which has already happened. It goes on to the destruction of the Georgian armed forces, which is now happening. And the third will probably be the replacement of the elected government, which is pro-western, with a puppet government, which will probably follow in the next week or two.

There is nothing that we can do now short of a military attack that would reverse that, but what we can do is to put sanctions on the Russians which might induce them over time to undo a few of these steps.

And the first would be immediately to declare that we are going to protect Ukraine, which is the next step. Ukraine is the big prize here. Perhaps station the troops and perhaps begin an admission process of the Ukraine into NATO.

Secondly, a dissolution of the G8 as a way to humiliate and exclude the Russians, and the third is to declare a European and American boycott of the Olympics which are going to be held in 2014 in Russia 15 miles from the border of Georgia.

BAIER: Jeff, we talked about how Georgia is not a member of NATO and had they been, it would have changed the situation, perhaps the response.

JEFF BIRNBAUM, COLUMNIST, "THE WASHINGTON POST": Well, it might have dissuaded the Russians from invading at all if Georgia, which is a democratic nation, had the backing of NATO, which means us and the rest of western Europe.

BAIER: And Russia fought that vociferously.

BIRNBAUM: Right, and successfully. Georgia is not a member of NATO. And that may be one of the reasons why, as Charles points out, the democratically elected government of Georgia may be gone soon, and that would be a terrible loss.

I'm not sure that we can do absolutely nothing, and I'm not sure whether it's good for the United States to do absolutely nothing. There just aren't that many levers to pull in order to make a difference.

You can't go to the United Nations very well and demand through the Security Council that peacekeepers go in and do something, perhaps stop the fighting with our own peacekeepers, because Russia will veto that. But it is clear that the United States has to face and do something about the dilemma.

And it is a very modern dilemma, whether to agree to be good to the Russians so that they can help us with Iran on the war against terror, or whether we should oppose the Russians, raise their ire, and perhaps lose the leverage they can use against Iran in the broader war against terror. That is really the central modern question.

FRED BARNES, EXECUTIVE EDITOR, "THE WEEKLY STANDARD": The Russians aren't using any leverage on the Iranians at all. If we're waiting for them to stop the Iranians from going nuclear, we'll be waiting forever, because they're the ones that watered down any of the economic resolutions, any of the economic sanctions against the Iranians, along with the Chinese as well.

Look, the first thing we have to think about is who are we dealing with here? You know, President Bush has made heroic efforts privately to be in a situation, after not criticizing Vladimir Putin publicly, to be in a situation where he could have some influence for good on Vladimir Putin.

Now, he obviously hasn't had much. It obviously has not worked. Putin is a bad person. Putin thinks that the collapse of the Soviet empire and the Soviet Union was one of the worst things that has ever happened in the entire history of the world, and he wants to build it back up again, if only being surrounded by states that he turns into eunuch states-E-U-N-U-C- H states.

BAIER: In fact he today the U.S. was essentially interfering by moving Georgia troops out of Iraq, flying them back to their home country.

BARNES: There are things we can do, and Charles mentioned a couple of them. One, the G8 can be the G7. It's supposed to be industrial democracies. Russia's not a democracy for sure.

The Olympics, obviously they want.

But the first thing to do is, one, forget about the U.N. They're going to be no help.

But there is NATO. We can have a NATO summit. NATO can say to the Ukraine, we will put you on the path towards being a member of NATO, and then reinforce the efforts to put air defenses--not air defense-- missile defenses in Poland and Czechoslovakia, and show the Russians that we're not going to take this lying down.

BAIER: Ten seconds--will the tough talk be backed up by this administration?

KRAUTHAMMER: As of now, it doesn't look like it. But one step would be suspending all negotiations including Russia coming into the World Trade Organization.

There are steps. They are rather weak, but if we start with a bunch of steps now, it will induce the Russians, in time, perhaps to slightly back off, although they will certainly pocket up South Ossetia.

BAIER: Last word on this panel. When we return, what did the candidates have to say about the situation in Georgia? We will take a look at that and what it means in the foreign policy debate on the campaign trail next.



SEN. JOHN MCCAIN, (R-AR) PRESIDENTIAL CANDIDATE: The United States and our allies should continue efforts to bring a resolution before the United Nations Security Council condemning Russian aggression.

SEN. BARACK OBAMA, (D-IL) PRESIDENTIAL CANDIDATE: The United States, Europe, and all other concerned countries must stand united, stemming this aggression and staking a peaceful solution to the crisis.

We should continue to push for a United Nations Security Council resolution calling for an immediate end to the violence.


BAIER: There you see John McCain and Barack Obama, Barack Obama making that statement from a vacation in Hawaii. We just got it in just a few moments ago about the situation on the ground in Georgia.

Barack Obama, according to many, has changed his stance slightly over the days since first coming out. Take a listen to his first statement on the situation.


OBAMA: I think it is important at this point for all sides to show restraint, and to stop this armed conflict. Georgia's territorial integrity needs to be preserved.


BAIER: So what about the situation on the campaign trail and this issue, in particular? Fred, what do you think?

BARNES: Well, I haven't learned a whole lot from these statements, but every time one of them mentions the U.N. is a place to go, I think that is a waste of time because--you can embarrass the Russians in Security Council by making them exercise a veto to block a resolution criticizing them.

So you hear Obama is saying what we need is an end to the violence. What we need is an end to the invasion by the Russians, and they should be condemned for it.

And to call for a U.N.--at this stage of what we know about U.N. peacekeeping forces, to call for a U.N. peacekeeping force is-it isn't going to help much, because they play matador defense when everybody wants to come in and do a lot o killing.

So, to be honest, I haven't been real impressed with what either of these candidates have said, but they're just the candidates. There's not much they can do.

Here is what I was struck by that McCain said, though, in a statement I think today or yesterday--"World history is often made in remote, obscure countries."

In other words, what he is saying this is a big deal, this is a world event that could really spiral into something much bigger than we have seen so far. And the next step for him is to say I'm the experienced guy in world affairs and Obama is not.

BAIER: Is he winning that message, though?

BIRNBAUM: I think that's the point, Fred. I think that McCain-- this is McCain's advantage here, advantage McCain. This is right in his sweet spot in foreign policy national security. He has known the current Georgian president, Saakashvili, since 1997. He met him when he was here in this country studying. And he knows all of the players in Georgia.

He has been firm in his position from the very beginning, saying that this is a Russian problem, a Russian invasion, and the Russians need to be stopped here, a position that, as we heard, Obama did not start with, but has ended up with. And he used his statement today, McCain did, to show he understands the sweep of history, something Obama has not yet done.

BAIER: Here the Obama people say--look at this--they say McCain went over the edge in his Russia-bashing, and that a measured approach at the beginning was the right approach to take. That's what they say.

KRAUTHAMMER: That's just silly. McCain had to bash the Russians because this is a naked aggression.

However, McCain has to be careful, because if you are going to threaten and bash, you have to be prepared to act on the ground, and we are not.

Obama was very weak in the beginning with this absurd calling of restraint on all sides, which is equivalent to calling restraint on the part of the David and Goliath at the same time.

But today he issued a statement in which he called for reconsidering Russia's entry into the World Trade Organization, a true sanction.

But it's the president who has been AWOL on this. He shouldn't have been hanging around in Beijing. Putin ended up in North Ossetia directing the war, and the president stayed around in Beijing hanging around with our athletes--not a good move.

BAIER: Last word for this panel, but stay tuned to see the latest You Tube sensation.


BAIER: Finally tonight, this presidential election has been and will be unlike any other. With the Internet factoring in more than ever before, web videos are all the rage, some of these videos made by campaigns, others made by average Americans with a lot of time on their hands.

Exhibit A, this version of Rick Ashley's "Never Going to Give You Up."


OBAMA: Even though the rules, and so do I, what I am thinking of, you would not get this from any other guy. I just want to tell you how I'm feeling, make you understand that I'm going to give you up, never going to let you down, never going to run around and desert you.

Never going to make you cry, never going to say goodbye, never going to tell a lie and hurt you.


BAIER: Just a lot of time to do all of that.

That's it for "Special Report." More news is on the way--fair, and balanced, as always.

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