This is a rush transcript from "On the Record," May 21, 2009. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Did you see it? Minutes apart, President Obama and former vice president Cheney on cue, coming out and each saying the opposite. Both men say they are right and both say the other is wrong. What do you think?

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I know some have argued that brutal methods like waterboarding were necessary to keep us safe. I could not disagree more. As commander-in-chief, I see the intelligence. I bear the responsibility for keeping this country safe, and I categorically reject the assertion that these are the most effective means of interrogation.

DICK CHENEY, FORMER VICE PRESIDENT OF THE UNITED STATES: In top secret meetings about enhanced interrogations, I made my own beliefs clear. I was and remain a strong proponent of our enhanced interrogation program. The interrogations were used on hardened terrorists after other efforts had failed. There were legal, essential, justified, successful, and the right thing to do. The intelligence officers who questioned the terrorists can be proud of their work, proud of the results. They prevented the violent death of thousands, perhaps hundreds of thousands of people.

OBAMA: To protect the American people and our values, we banned enhanced interrogation techniques. We are closing the prison at Guantanamo. We are reforming military commissions, and we will pursue a new legal regime to detain terrorists. We are declassifying more information and embracing more oversight of our actions, and we're narrowing our use of the state secrets privilege. These are dramatic changes that will put our approach to national security on a surer, safer and more sustainable footing.

CHENEY: To call this a program of torture is to libel the dedicated professionals who have saved American lives and to cast terrorists and murderers as innocent victims. What's more, to completely rule out enhanced interrogation in the future is unwise in the extreme. It is recklessness cloaked in righteousness and would make the American people less safe.

(END VIDEO CLIP)

VAN SUSTEREN: So battle lines are drawn and the dispute has intensified. Everyone is talking about those two speeches, and moments ago, Senator John McCain went "On the Record" about waterboarding, what to do with the prisoners at Guantanamo Bay and much more.

(BEGIN VIDEOTAPE)

VAN SUSTEREN: Senator, nice to see you, sir.

FORMER PRESIDENTIAL CANDIDATE SEN. JOHN MCCAIN, R-ARIZ.: Thank you.

VAN SUSTEREN: Big weekend for the family, or big event in the family?

MCCAIN: Friday, tomorrow, my son is graduating from the Naval Academy in better class standing than I had, which wasn't hard to do. And he's the fourth generation Naval Academy graduate. I'm very proud of him. He's going to pilot training.

VAN SUSTEREN: And you have another son who's coming home, right?

MCCAIN: Coming home, yes. He's been overseas. He is a corporal in the Marine Corps.

VAN SUSTEREN: So big events in the McCain family.

MCCAIN: Indeed.

VAN SUSTEREN: All right, now, so that I can sort of set the table right so you and I are on the same page, is waterboarding torture or enhanced interrogation technique? What word should we use on this?

MCCAIN: It's torture. It's in violation of the Geneva Conventions, of the international agreement on torture, treaty of torture signed during the Reagan administration. It goes all the way back to the Spanish Inquisition. It's not a new technique, and it is certainly torture.

VAN SUSTEREN: It's now the subject of a great debate again today that President Obama spoke and former vice president Cheney spoke. President Obama says it's torture. Former vice president Cheney says it's enhanced interrogation techniques. Those are the words he uses. President Obama says it's a recruitment tool. Vice President Cheney says it is not. Is it a recruitment tool?

MCCAIN: Well, torture certainly is. I was at Camp Bucca a couple of years ago with Senator Lindsey Graham. And there was 20,000 prisoners in that prison at that time. We were taken by the Army general to meet in a secluded area with a former high-ranking al Qaeda member, a very tough guy. In the course of our conversation, I said, What was it that made you succeed so well? And he said, Two things. One, after the invasion was total disorder and chaos, murder, all kinds of bad things, and that allowed us to gain a foothold. He said, But my greatest recruiting tool, he said, I recruited thousands of young men -- Abu Ghraib.

And so you know, you hear it from al Qaeda operatives that when we torture people and it becomes public, then it helps them recruit. I think that's the end of the argument.

VAN SUSTEREN: Well, Vice President Cheney said today that Abu Ghraib is different than the waterboarding done by our government. He said that Abu Ghraib was a terrible thing done by some members of our military. He said that waterboarding, though, that it was done on only three people. And I'm not saying this to defend him, but just to repeat what he said -- done by (SIC) three people and that it did achieve some goals in that we learned information, but that the President Obama administration won't declassify the information which would back up the Bush administration.

So where do you stand on this?

MCCAIN: First of all, I think any relevant information, as long as it's not harmful, such as the photos would have been harmful, ought to be released.

But look, I think that it's important for us to recognize that most military people don't believe we should torture people and most military and FBI people say that you can gain better results through other techniques because once you hurt someone badly enough, they're going to tell you whatever they want you to hear in order to make it stop. That's pretty logical. So we can gain better information through using different techniques which are not in violation of any of the treaties or obligations, not to mention our image as a nation.

There are times -- and we'll hear this discussion a lot -- where information has to be gained immediately. There's a story in Israel where a soldier was kidnapped, as I recall it. They caught the person who was the driver. And they interrogated that guy very harshly and got the information they needed and saved the life.

Now, I understand that, too. But if you're going to do that, as president of the United States, you have to take the responsibility. And I understand there's that one-in-a-thousand situation. But normally, we shouldn't do it.

And finally, could I say that it is not as effective as the other kinds of techniques that are not in violation of any treaty or obligation we have.

VAN SUSTEREN: Well, here's the sort of the troubling thing that I have as a citizen, is that Vice President Cheney says there are documents that show that -- you know, that we achieved all this, and they don't get declassified. Over on the House side, Speaker Pelosi is embroiled in a huge brouhaha with the CIA. She said that they lied to Congress. And she wants documents. It seems like there's this universe of documents that the government sort of almost gets to decide what gets declassified and what does not, and we the American people just sit here and listen to the fighting back and forth over it.

MCCAIN: The intelligence communities on both the House and Senate side have access to any information they want. That's government oversight. The judgment has to be made as to whether and what documents are relevant to the discussion. As I said, if the president -- if the vice -- former vice president feels that there's information and documents that can bolster his case, then I'm for revealing it.

But I also am not for going back over what's happened. I'm concerned about morale at the CIA. I'm concerned about morale of other people who have very dangerous and tough jobs. If they think they're under assault again, as they did when the Church commission back in the '70s was attacking the CIA, then it's going to harm our national security.

Let's move forward and let's establish a clear policy that we aren't going to torture people. And frankly, at some point, we've got to understand we're in two wars. And Afghanistan is going to be tougher before it gets better. And we should focus our attention on the threat, which was just uncovered yesterday in New York City, that there are threats out there and people out there as we speak who are plotting to harm America and kill our citizens.

VAN SUSTEREN: Well, I'm with you on all of that, except that there's this sideshow, gamesmanship aspect. The reason why, apparently, Vice President Cheney can't get the documents released, why the CIA rejected his request, is they are subject to a FOIA request in some collateral litigation. And there's a rule. So this rule sort of prevents us from finding out whether Vice President Cheney's being straight with us or not.

With Speaker Pelosi, although, you know, I agree the CIA needs to be able to do its job and that we don't want to inhibit them from doing it, but on the other hand is that we also don't need the Speaker of the House tarnished in doing her important job if she's the subject of political warfare. So getting all the documents out, just so we can see -- somebody's not straight. Somebody's fudging. Someone may be mistaken.

But we don't get this. We just sit and watch this almost like a sideshow, the political aspect to it.

MCCAIN: In the case of the Speaker, the Speaker brought it up. The Speaker has made an accusation of the utmost gravity, that one of the most important agencies of government lied to Congress, or quote, "misled" Congress. That, in my view, is something that she has to prove.

VAN SUSTEREN: She may be the -- she may be the wrong one in the dispute. I don't know. But I mean, the documents will at least end it.

MCCAIN: Well, I would hope that she would get the right documents, although I don't know if they exist or not but -- because the director of the CIA, a friend of hers, Mr. Leon Panetta, has said that she was briefed on these procedures and that she was fully aware that it was being done. So if she's accusing an agency of government that they are -- that they have misbehaved and deceived Congress, then I think it's her obligation to prove it. And if she needs to have those documents to prove it, that's fine with me.

VAN SUSTEREN: Well, and I don't mean to beat a dead horse, but already, the things that have quote, "leaked" out, and -- you know, which - - you know, when it leaks out, I'm never very confident that it's this -- you know, exactly everything. But there (INAUDIBLE) Senator Graham said that it was reported -- former Senator Graham -- reported that he attended some meetings that he didn't. Then yesterday, a staffer was said to have attended a meeting, and he was no longer on staff.

So you know, we're seeing problems with these so-called documents. It seems to me (INAUDIBLE) let's -- as long as it doesn't jeopardize a covert operation or anyone's life, let's get it out. Let's get this behind us and let's move on.

MCCAIN: I totally agree. I'd add one other point. We have to be careful about the morale, therefore the effectiveness, of the CIA and other intelligence agencies because we are in this struggle, as was just proven yesterday in New York City. So let's get it done and move on and help these agencies protect America.

(END VIDEOTAPE)

VAN SUSTEREN: Up next, more with Senator McCain. Does he think the Democrats should be called "socialists"? And how about the war on terror? Why does it have a new name?

And later, Laura Ingraham goes "On the Record" about the speech-off between President Obama and Vice President Cheney. Were the president and former vice president just gaming us today, Playing politics but not giving us answers? Laura will tell you.

(COMMERCIAL BREAK)

VAN SUSTEREN: More with Senator John McCain.

(BEGIN VIDEOTAPE)

VAN SUSTEREN: The new administration doesn't want to call it a "war on terror." They call it -- you know -- you know, I've read (ph) it's overseas -- maybe you can help me with it. They have some term for it.

MCCAIN: Overseas contingency operations. I don't think that...

VAN SUSTEREN: What's with that? I mean, why are we doing -- what's with this name change?

MCCAIN: I don't know, but do we call the plot that was just uncovered in New York City, a plot to blow up a synagogue, an "overseas contingency"? I don't think so.

VAN SUSTEREN: Well, I guess it brings me back to this sort of, like - - you know, the aspect that sometimes the American people, they sit back and they listen to the two sides battling it out, whether we call it enhanced interrogation techniques or torture, and we get -- we get looped into that battle, then how we describe what's going on in the world, whether it's a war on terror or overseas contingency operation. You know, it sort of -- it oftentimes feels like that we're so distracted from our primary goals.

MCCAIN: And words sometimes connotate (sic) different things, and people like to use the words that are most pleasing to the ears of those who hear them. But the fact is, we are in a struggle against radical Islamic extremism, who want to come to the United States or launch attacks on the United States and destroy us and everything we stand for and believe in. And unfortunately, it is global. But if they want to call it overseas contingency, that's OK with me. I don't think it changes the threat we face one iota.

VAN SUSTEREN: All right. Republican Party now uses the word "socialism" to describe -- all right, you -- it's, like, that -- that's the -- speaking of words, we're back to words. What's with that? And what's your position on making the reference to socialism as the Democratic Party?

MCCAIN: I don't -- I don't think it's a worthwhile argument. I think we ought to judge the administration by its actions and then let people draw their own conclusions. I noticed yesterday, under the influence of Haley Barbour, it was not branded as, quote, "socialist" but "path to socialism," or something like that.

Look, Americans are hurting right now. They want jobs. They want to stay in their homes. They want health care. They want all of the things that are part of a very severe economic crisis we're in. We would be better served as Republicans by prescribing fixes and ways to bring America out of this economic difficult challenge that we're in today. That's what we ought to be spending our time on.

VAN SUSTEREN: And not worried about what words we call each other and stuff.

MCCAIN: Yes.

VAN SUSTEREN: OK. Gitmo. What are we going to do with Gitmo?

MCCAIN: I'd close it, but I would have an overall policy first. The thing -- the single act that set all of this controversy in motion was the announcement of the closure of Guantanamo within one year without addressing the hard issues. What do you do with the people that you want to detain but can't try? What do you do with the people who you know -- that can't go back to the country that they came from because you'd be putting them in danger? All of these other issues that should of been resolved before the announcement of the closure of Guantanamo.

So we ended up with this great announcement, lot of fanfare, and then we run into the harsh realities of how we're going to implement, whether it be military commissions or whether it be regular trials, or all of those aspects of this issue that make it so thorny, which don't allow us to close Guantanamo until we reach these policy decisions. And frankly, the president's speech, where he said he was going to consult with Congress -- that's not a policy.

VAN SUSTEREN: Is he consulting with Congress? I mean, is he consulting with Republicans? He said he wants, you know, transparency. He says he wants to reach across the aisle. Everyone says he wants to reach across the aisle, though. Is that happening? Is the White House talking to Republicans on the Hill?

MCCAIN: I have not had an occasion on a major issue, whether it be the stimulus package or the automotive industry or health care reform or any other yet, where we've had true negotiations. We've had meetings. We've had discussions. But true negotiations are when you sit down across the table and you say, OK, here's our position, here's yours. Now, what are we ready to compromise on so that we can come to an agreement that's truly bipartisan?

They're able to either have 60 votes or pick off two or three Republicans and move their agenda forward. I'm not complaining about that because that's -- elections have consequences. But I am saying that that's not negotiations.

(END VIDEOTAPE)

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