Interview of the Vice President on Fox News Sunday

SNOW: Enron, who knew? Bin Laden, dead or alive? Yasser Arafat, friend or foe? Tax cuts, yes or no? And what does the president do with 80 percent approval ratings? We'll toss those questions to our special guest, Vice President Dick Cheney.

Plus, Brit Hume, Mara Liasson, Bill Kristol and Juan Williams offer their wit and wisdom. This is the January 27 edition of Fox News Sunday.

Good morning, and welcome to Fox News Sunday. Our special guest today, the vice president of the United States, Dick Cheney.

Mr. Vice President, good morning.

CHENEY: Good morning, Tony.

SNOW: There's been a bombing this morning in Jerusalem. Just the other day President Bush said of Yasser Arafat, "I am disappointed in Yasser Arafat. He must make a full effort to rout out terror in the Middle East."

How did today's events affect that?

CHENEY: It's just one more example of the extraordinarily difficult circumstances that exist there.

Clearly, when Yasser Arafat returned to Palestine, as the peace process began several years ago, he renounced violence, terrorism, and promised to enter into a peace process to try to trade land for peace and resolve the outstanding conflict.

In recent months, obviously, the level of violence has increased, and a lot of that due to suicide bombers that launch from Palestine against Israeli civilians.

This attack this morning is just one more instance that proves that there is no effective control of the terrorist attacks that are being launched against Israel.

SNOW: When you say there's no effective control, do you believe Arafat is trying to control it?

CHENEY: Well, there used to be a question about whether or not he was trying to control it and couldn't or whether he wasn't really committed to trying to control it.

One of the most disturbing events recently has been the discovery of this Karine A ship, a ship trying to move 50 tons of military equipment--weapons, C-4 explosives, new extended-range rockets--to Palestine.

SNOW: From Iran to Palestine.

CHENEY: Provided by Iran and apparently through Hezbollah to Palestine.

And the thing that's especially disturbing about this, not only would it escalate violence obviously--the only use for the C-4 is to make the suicide bombers more effective or kill more people when they detonate--but it also, in effect, has the Palestinian Authority and Yasser Arafat, the key people around him, working now with Iran, which is absolutely dedicated, has stated repeatedly that a major objective of their foreign policy is to destroy the peace process--and with Hezbollah, which is also clearly one of the world's foremost terrorist organizations devoted to ending the peace process.

So it raises serious questions whether Mr. Arafat is in fact really interested in moving forward with the peace process.

SNOW: Raises serious questions. Do you think there's any question that he was not involved in...

CHENEY: In my mind, and based on the intelligence we've seen, the people that were involved were so close to him it's hard to believe that he wasn't.

SNOW: He wrote a letter to the president saying he knew nothing about it. How would you characterize that statement?

CHENEY: Well, it doesn't help. It's not credible for him to suggest that.

The president has done everything he can, spent a lot of time and effort to try to promote the cause of peace. He's called for a Palestinian homeland, first president to ever do that. Colin Powell made a very important speech in Louisville a few weeks ago on the whole Middle East situation. We sent General Zinni to the area to try to get negotiations re-started again.

But as long as we see this inability, if you will, whether it's deliberate or whether it's through lack of authority, to control the suicide bombers and to end terrorism attacks, it's very hard to see how we move forward on the peace process.

SNOW: Who must take the first step?

CHENEY: Well, I think Arafat has to demonstrate that he really is serious about it. It's up to him.

SNOW: And how would he demonstrate that?

CHENEY: Well, he would move aggressively to rout out the infrastructure of the terrorist organizations in Palestine. He would arrest those who are known to be perpetrating those acts and planning them and providing and supporting them. He would do everything he could, make a 100 percent good-faith effort to put an end to terrorism. So far he hasn't done that.

SNOW: You mentioned the Karine A. This is a freighter headed from Iran to help out Palestinians. How would you characterize that mission? Was that a terrorist mission?

CHENEY: Oh, I think so, given the people that were involved.

SNOW: So Yasser Arafat was involved, in your opinion, in a terrorist mission?

CHENEY: That's correct.

SNOW: What would that make him?

CHENEY: Well, he clearly was a terrorist in the past and was so identified by the United States government.

Now, in the early '90s, all of that changed. We had the Oslo Accords. We had Arafat come to Washington and enter into an agreement, 1993, on the South Lawn of the White House, and we set up the process, got the process going of negotiations. And he renounced terrorism and he renounced violence and recognized the right of Israel to exist.

CHENEY: What's happened now is, after the Camp David accords blew up in 2000 at the end of the Clinton administration, and the intifada began, so now we've had this escalation of violence on both sides, to the point now where it's very hard to see how we get people back together at the negotiating table until we end the violence. And at the heart of that are those suicide attacks being launched against Israeli civilians.

SNOW: So the American position is: No talks until Yasser Arafat acts effectively to put an end to terrorism?

CHENEY: We think he has to make a 100 percent effort, do everything he can to control--exercise control, if you will, over those areas of Palestine that he's responsible for. The Palestinian Authority has security forces and so forth for that purpose. And he simply has to step up to those responsibilities, or it's impossible to see how we actually resume the peace process.

SNOW: His security forces are at least 10 times as large as Hamas and Hezbollah within his territory. So don't you believe that he ought to be able to tamp down on them?

CHENEY: I do. I think the only way you're going to move forward on this is if in fact we can get the level of violence significantly reduced, and he's the lead player obviously on the Palestinian side.

SNOW: A lot of people who have worked with him are now very bitter. And Anthony Zinni is quoted in today's "Jerusalem Post" as calling the Palestinian Authority a mafia, with Yasser Arafat as its boss.

CHENEY: I haven't seen the quote.

SNOW: OK, so...

CHENEY: Tony's a pretty tough guy. But I haven't seen the quote.

SNOW: Well, this is the man that we are going to dispatch to the region. As a matter of fact, Yasser Arafat has called for sending him back. Are we going to send Anthony Zinni back to the Middle East?

CHENEY: At this stage, we need to see some positive signs that his return would do some good. And that means we've got to see some positive results out of Arafat. He has to fulfill his commitments. He's got to exercise his responsibility to control the terrorist attacks.

SNOW: Are you afraid right now that Iran is now in cahoots with the Palestinian Authority?

CHENEY: I am. Clearly, there's going to be some kind of debate as to whether or not he simply went to them because he thought he could get arms there. But, given their...

SNOW: But he went to them, though. They did not come to him?

CHENEY: I can't say that for sure, but I know where he acquired the weapons. He did acquire the weapons from Iran.

And the really disturbing part of this, of course, is that there are a lot of places he could go in the Arab world if he were looking for support and sustenance or for help in moving the peace process forward. Clearly, he hasn't done that. What he's done is gone to a terrorist organization, Hezbollah, and a state that supports and promotes terrorism, that's dedicated to ending the peace process, Iran, and done business with them.

SNOW: You mentioned earlier that there have been a couple of statements by this administration supporting the cause of Palestinian statehood. You also said in December that the recent violence had hurt that cause. Is that off the table for now?

CHENEY: The Palestinian homeland?

No, what the president said in effect is, this clearly is part of the ultimate vision for that part of the world, that you'll have a peace process, the Israelis and the Palestinians will negotiate on all of these important issues--where boundaries are, what the terms and conditions and so forth are.

But, at the end of that process, the Palestinian people, who after all probably suffer more than anybody else in that process, and the lack of an effective peace process, the Palestinian people would have their own homeland, where they would exercise sovereignty and live in peace.

And that's a dream, I think, for many of the Arab leaders in that part of the world, certainly for this administration and, I think, for many Palestinians. Apparently, however, Mr. Arafat doesn't look as though he shares that.

SNOW: That being the case, when you were defense secretary in the first Bush administration, that administration ceased its relations with the Palestinian Authority. Is that a possibility?

CHENEY: Well, we did on that occasion, again in particular because we felt he hadn't kept his commitment to renounce violence.

At this stage, I wouldn't want to forecast...

(CROSSTALK)

SNOW: But that is a possibility?

CHENEY: What we've done is make it abundantly clear that Arafat has to take action. He has to...

(CROSSTALK)

SNOW: Do you have a deadline? I mean, many people have issued ultimatums to him before.

CHENEY: I don't want to predict...

SNOW: I'm not going to ask you what the deadline is. Have you given him one?

CHENEY: We've been very clear in our communications with Mr. Arafat. Colin Powell talked with him just in the last couple of days, what it is we expect of him. He knows what he has to do to be taken seriously.

SNOW: Let's switch to Enron. Much in the news. A lot of Democrats and Republicans on Capitol Hill want you to release the names of companies and individuals who participated in the deliberations of your energy task force. Why don't you release the names?

CHENEY: Well, there's an important issue here. Tony, you've got a situation in which the president asked me to put together a comprehensive energy policy, the first week we were in office, because there was none. It was vital for our economic and our national security we do that.

So we produced a report. It's a good report. We worked for several months on it. It's got 105 recommendations in it. And we published thousands of copies of it, distributed it all over. The House has now passed its portion of it.

CHENEY: The problem we've had is that Henry Waxman doesn't want to have to deal with the substance of the report, but he's tried to attack the report by challenging the process, by saying we didn't meet with the right people. He's gotten the GAO involved now and demanding...

SNOW: Government Accounting Office.

CHENEY: Government Accounting Office--and demanding that we produce information about how the report was put together.

Now, we've given him an awful lot. We've given him all the financial records, the work that was done by the agency, all of that's gone to the GAO.

What we've not given them, and where the dispute lies, is they've demanded of me that I give Henry Waxman a listing of everybody I meet with, of everything that was discussed, any advice that was received, notes and minutes of those meetings.

Now, that would be unprecedented in the sense that that's not been done before. It's unprecedented in the sense that it would make it virtually impossible for me to have confidential conversations with anybody.

It, in effect, says that I, and future vice presidents, would be in a position where any time Henry Waxman or any other member of Congress wants to demand of me information about the meetings I hold, I'd have to give it to them. The lawyers in the executive branch are convinced this is a fundamentally bad idea.

SNOW: So you'll go to court over this?

CHENEY: As of last August, we've made that decision to go to court. We'd come to an ultimate showdown, and we've concluded that, in fact, we were prepared to go to court if that's what was necessary. At that point, the GAO backed off, and they, in effect, sort of put everything in abeyance.

Now what's happened is we've come back around, as a result of the Enron corporate collapse, some of the Democrats on the Hill are trying to re-energize this and try to turn it into some kind of political debate with respect to Enron.

But what's really at stake here is the ability of the president and the vice president to solicit advice from anybody they want in confidence, get good, solid, unvarnished advice without having to make it available to a member of Congress. The GAO does not have the authority to get into that particular arena. It has a...

SNOW: Is there any circumstance--you talked before about compromises, that there may be...

CHENEY: Well, I think we have compromised. We've given them a great deal of information. We have not given them those things that we believe that I have to have--I have to have the ability to talk to people in confidence if I'm going to effectively advise the president.

SNOW: So you will not give them anything more?

CHENEY: That's correct.

SNOW: No more compromises?

CHENEY: That's correct.

SNOW: David Walker, the comptroller general, said just yesterday: "We've never had any situation where we were absolutely stonewalled by a task force of this type. The law in past precedence says that Congress has a right to this information and can use the GAO to conduct a non-partisan review."

CHENEY: No, that's where the dispute lies, because the GAO is a creature of the Congress, created by statute. Their jurisdiction extends to agencies created by statute. That's not me. I'm, as part of the office of the president and the vice president of the United States, I'm a constitutional officer. And the authority of the GAO does not extend in that case to my office.

Now, I've been around town for 34 years, Tony. I've seen a constant, steady erosion of the power and the ability of the president to do his job. We've seen the War Powers Act and Anheim (ph) Powerment (ph) Control Act.

And time after time after time, administrations have traded away the authority of the president to do his job. We're not going to do that in this administration.

The president's bound and determined to defend those principles and to pass on this office, his and mine, to future generations in better shape then we found it.

And for us to compromise on this basic fundamental principle would in effect do that. It would further weaken the presidency, and we don't want to do that.

SNOW: Mr. Vice President, we're going to take a break.

But stay with us. We'll have a lot more on Enron, the economy and much more in just a couple of minutes.

SNOW: We're back with Vice President Dick Cheney. Also here, Brit Hume, Washington managing editor of Fox News.

Brit?

HUME: Two questions, Mr. Vice President, on this Enron and the GAO. Are there any circumstances under which a release of this information to the members of Congress, informally, to a committee, not the GAO, would be possible?

CHENEY: Well, there's, you know, there's no secret about what we did with respect to the task force. We talked to all kinds of people. I talked to energy companies, I talked to labor members, talked to environmentalists. Other members talked to a wide variety of people, and folks came in and discussed with us and gave us advice and recommendations. Some of them went out and made public what they did. That's fine. That's their business.

What I object to, and what the president's objected to, and what we've told the GAO we won't do, is make it impossible for me or future vice presidents to ever have a conversation in confidence with anybody without having, ultimately, to tell a member of Congress what we talked about and what was said.

You just cannot accept that proposition without putting a chill over the ability of the president and vice president to receive unvarnished advice.

HUME: Having taken that position, clearly you believe at law you will be able to sustain it.

CHENEY: We do.

HUME: A political question, and that is, whatever your motives and whatever the underlying reality, it is going to look as if, in the midst of the collapse of Enron and the attendant scandal, that the administration has something it doesn't want to tell, something it wants to hide.

Are you and the president prepared to endure what you know are going to be the political difficulties that that position will lead to, in order to vindicate this principle?

CHENEY: The issue here isn't, with respect to Enron, isn't what advice they may have offered the energy task force. The issue, with respect to Enron, is the corporate collapse. It's what happened when, for whatever reason, laws were broken, maybe the laws were flawed, maybe the accounting system was flawed, we'll find out, we don't know yet. But that's the political issue, with respect to Enron, as how that's handled.

HUME: I didn't say it would be fair. I just said you would receive it.

CHENEY: That's how it'll be managed. And what's happened there, of course, is the president's insisted on a full and complete investigation. We're going to make absolutely certain, if there are guilty parties there, if laws were broken, there's full prosecution under the law. We've got a pension reform 401(k) task force already working to look for ways to improve that.

We'll do whatever's necessary legally and, from a statutory and regulatory standpoint, to make sure that doesn't happen.

But if you go back to August, and the judgment in August was that it was important to protect this principle of our ability to seek advice on a confidential basis, and that that was legally sound and historically and constitutionally important, the collapse of Enron doesn't change that.

Why would you say, well, Enron collapsed, therefore, you ought to give up a basic fundamental principle of the presidency? It doesn't track.

HUME: It isn't logical, but there it is.

CHENEY: Well, but...

HUME: And I just wonder whether, if there are political costs--and there may be--are you saying here that you and the president are prepared to bear them?

CHENEY: I'm saying, again, reiterate once again, we feel very strongly that this is an important proposition.

And after all of these years, I think back over history, can you imagine an FDR or Teddy Roosevelt, in the midst of a grave national crisis, dealing with the problems we're having to deal with now, over here on the side as a matter of political expediency, trading away a very important fundamental principle of the presidency? That's not how you make a great presidents.

And I think from the standpoint of this basic proposition, we are right--I think people know we're right--and we'll do everything we can to sustain that position.

SNOW: You held up the energy plan before. Is there anything in that energy plan that was done specifically for or at the behest of Enron?

CHENEY: I can't say. I'm sure they supported many parts of it.

We talked to them about their role. They were the world's leading energy trader. At the time that they were involved, they were heavily engaged in this whole process of trading energy. It was a whole new development with respect to the way the markets worked, and they had good advice to offer in terms of how you dealt with that situation.

SNOW: So you don't agree with...

CHENEY: I can't say a particular proposal came from them. They advocated, for example, or opposed price controls on energy. But guess what? I've been opposed to price controls since I worked in Nixon's control program 30 years ago. So, my own views in 20 some years worth of experience are heavily involved there.

But I'm sure, you know, as I talked to a whole wide range of people, we gathered up information and advice and we put in there.

Ultimately, we should be judged based on what we put in the report. That's what I recommended. That's what the task force recommended to the president. And we benefited from talking with a wide variety of people in putting that report together.

SNOW: Well, Tom White, the army secretary, used to run something called Enron Energy Services. It is now being reported that was one of the spinoffs in which Enron was concealing its losses from investors. If that is the case, and if he knew about it, would you expect him to step down?

CHENEY: Well, I don't have any detailed information about what was going on inside Enron, obviously.

I know Tom White, and Tom White was a great soldier. He's a man who worked as Colin Powell's exec on my watch in the Pentagon. We are extraordinarily fortunate to get him to give up his private life and return to public service as secretary of the Army. And I'm got every confidence he handled himself in an ethically appropriate manner.

HUME: Speaking of Colin Powell, we now know from newspaper reports, the Washington Times in particular on Saturday, that there is a discussion within the administration about the proper way to treat the prisoners held in Guantanamo Bay.

Secretary Powell apparently has recommended that before they be designated as POWs or not that their cases be dealt with by a tribunal and that they at all times be declared by us to be governed by, and our treatment of them governed by, the Geneva Convention, as best we can understand it.

What about that?

CHENEY: The actual issue's different than that. We're all in agreement--Colin, me, Don Rumsfeld--that these are not lawful combatants, they're not prisoners of law.

There is a legal issue involved as to whether they should be treated within the confines of the Geneva Convention, which does have a section that deals with unlawful combatants, or whether they should be dealt with outside the Geneva Convention.

There's another school of thought that says the Geneva Convention does not apply to terrorist attacks. It was set up to deal with a war between sovereign states. It's got provisions for dealing with civil war. But in a case where you have non-state actors out to kill civilians, then there's a serious question whether or not the Geneva Convention even applies.

The bottom line is that legal issue is being debated between the lawyers. It'll go to the president. He'll make a decision.

The detainees are being treated humanely. But they are not lawful combatants. These are the worst of a very bad lot. They are very dangerous. They are devoted to killing millions of Americans, innocent Americans, if they can, and they are perfectly prepared to die in the effort.

And they need to be detained, treated very cautiously, so that our people are not at risk. And they also probably have information that we need to prosecute the war on terrorism.

So, they're being treated appropriately in Guantanamo Bay, but there is this legal issue that's going to get resolved.

HUME: What is the down side of going along with Secretary Powell's advice on this?

CHENEY: Well, the Justice Department had other advice. Counsel's office of the White House had other advice. It's a dispute among lawyers about statutes, international agreements, international law, how we should treat what is now--you know, this is a new area we've embarked upon. We've not before been in the business of detaining large numbers of terrorists.

And we've got an ongoing war going here. And so their fate, how we deal with them appropriately, how we maintain our commitment to our values as a free and open society, how we extend to them humane treatment but at the same time deal with them the way they need to be dealt with...

SNOW: There's no part of the difference with the Geneva Convention says all they have to do is give name, rank, serial number, birth date and what we want is a lot more information than that, so there are certain restrictions of the Geneva Convention.

CHENEY: Sure, that's one issue.

SNOW: Let's switch to the war. It has been reported that American authorities believe that Mullah Omar and Osama bin Laden are somewhere in that Pakistan-Afghanistan border area. Is that correct?

CHENEY: We think so. We don't know for certain, but obviously we received reports. And my guess is, personal view based on what I've seen, that they are both still in the region.

SNOW: So there are signs, even though we're not getting videos and other things, that bin Laden's still alive?

CHENEY: I think he is. Again, we haven't seen him, obviously, in the flesh recently, and he's been very quiet. He hasn't released any videos or made any public pronouncements. But I think, if he were dead, there'd be more indications of it than we've seen.

SNOW: More violence?

CHENEY: No, I think more--there'd be more noise in the system about his demise and about the future of the organization, if, in fact, he were no longer there.

HUME: It now appears that the votes may be present, likely are present, to pass campaign finance reform out of the House of Representatives. You know basically the shape of the two bills. There are a lot of similarities between them. You know what's likely to emerge, therefore.

The president has indicated in the past that he would sign such a bill. How does he feel about it now? Is that pretty forgone, the president will sign the campaign finance bill?

CHENEY: Go back and remember, when we got started on this debate early last year, the president laid out a set of principles, and those will be the standards by which he judges any legislation that lands on his desk.

He said, if you're going to have a bill, it ought to ban soft dollars from corporations and from unions, that it ought to provide for maximum participation by those who want to participate, it needs to provide for full and open disclosure. We need to make sure there's opportunity in there for people to avoid having to contribute involuntarily, where they pay dues and a part of that gets contributed to political campaigns even though they don't want it contributed to campaigns.

So those basic standards I think will be used to evaluate any bill that lands on his desk.

HUME: So it's not definite at all that those bills that are over there now that we know so much about would meet the test.

CHENEY: Well, I think the president would like to sign a bill. He thinks a campaign finance bill would be a good idea, a finance reform bill, if it's a good bill, if it meets those standards.

SNOW: Is McCain-Feingold such a bill?

CHENEY: I think we felt it needed work when it left the Senate.

SNOW: So the answer would be no?

CHENEY: I'd have to go back and--again, it's been a while since I looked at the particular legislation.

SNOW: The president's going to deliver the State of the Union address next week. There's a lot of talk about economic stimulus.

In December, you used the term "obstructionist" when asked about Tom Daschle. Do you still believe he is?

CHENEY: My friend Tom Daschle?

(LAUGHTER)

I thought--I was asked specifically as it related to the economic stimulus bill. And I do believe, as I said then, I haven't changed my view, that Tom was an obstructionist; that we'd gotten a good bill through the House, that we've had a serious blow to the economy, the recession that was already under way, and then September 11 prolonged it, deepened it, and that recovery from that depended upon our getting a decent stimulus bill through.

Now, what's happened, of course, is, he blocked any action last fall. As the Democratic leader in the Senate, he wouldn't let anything come to the floor. He's now trying, I think, to recover from that. I think he's feeling the heat.

But we think we still need a stimulus package, and we're hoping he'll be cooperative.

SNOW: Do you like the offer he made yesterday?

CHENEY: I didn't see his offer yesterday.

SNOW: OK. A couple of very quick parting questions. Your health?

CHENEY: Good.

SNOW: Good? That's it?

CHENEY: Well, I'm alive and kicking.

SNOW: No fibrillations? You haven't had any episodes?

CHENEY: No. My ICD is never activated. I wear my pacemaker, but it's never gone off, so I'm still waiting to find out what it's like when it does.

SNOW: So who's got the better cave, you or bin Laden?

CHENEY: I think I do.

SNOW: Comfortable?

CHENEY: Nobody's trying to bomb mine.

HUME: Just one quick question on the implications for U.S. policy with Iran, given their--what you believe is their evident role in arms to the Palestinians. Do we now--does that put Iran on the list of countries we've got to deal with in the war on terror?

CHENEY: Well, they've been there right along. The fact of the matter is, Iran has been one of the foremost sponsors of state terrorism in recent years for a very long time. And so clearly, when we attempt to deal with the worldwide terrorism problem, we've got to find some way to encourage Iran to change their behavior.

SNOW: Mr. Vice President, thanks for joining us.

CHENEY: Thank you, gentlemen.