CNBC - Kudlow & Company

On April 4, I appeared with Washington Post military correspondent Tom Ricks on the CNBC show Kudlow & Company. The transcript:

Rick Francona, CNBC Middle East military analyst, and Tom Ricks of The Washington Post discuss Iran, Iraq and al-Qaeda

LARRY KUDLOW
Mr. TONY BLAIR: To the Iranian people, I would simply say this. We bear you no ill will. On the contrary, we respect Iran as an ancient civilization, as a nation with a proud and dignified history, and the disagreements that we have with your government, we wish to resolve peacefully through dialogue.

LARRY KUDLOW, host:
All right. Gentlemen, we have Tom Ricks, The Washington Post. We have Rick Francona, former Army colonel who's been fighting all over the world.

Lieutenant Colonel RICK FRANCONA, Retired (US Air Force, CNBC Middle East Military Analyst: Air Force.

KUDLOW: Let me ask you, gentlemen, in one word for the tease, one word for the tease. In this hostage standoff did Iran win? Rick Francona, yes or no?

Lt. Col. FRANCONA: No. No.

KUDLOW: No.

Tom Ricks, yes or no?

Mr. THOMAS RICKS ("Fiasco" Author, Washington Post Military Correspondent): I think so, yeah.

KUDLOW: All right. A good split. I was hoping for that. We are going to come right back for an extended discussion. I would reckon the hostages were the big winner now that they're free.

KUDLOW & COMPANY coming right back with our military experts, Colonel Rick Francona and The Washington Post columnist Tom Ricks.

Be sure to tune in tonight, by the way, at 7 PM Eastern for behind the scenes with the "Mad Money" man himself, Jim Cramer. It's Jim like you've never seen him before. All-access all the time. Behind the scenes, Jim Cramer tonight at 7, only on CNBC.

KUDLOW & COMPANY coming right back.

President GEORGE W. BUSH: A narrow majority in the Congress passed legislation they knew all along I would not accept. Their bills impose an artificial deadline for withdrawal from Iraq. Their bills substitute the judgment of Washington politicians for the judgment of our military commanders. Their bills add billions of dollars in pork-barrel spending.

KUDLOW: All right. There you have it. President Bush back on the warpath.

Joining us now is Rick Francona, retired US Air Force lieutenant colonel, CNBC military analyst. By the way, he served in Lebanon, Syria and Iraq. We also have Thomas Ricks, columnist for The Washington Post and author of the remarkable book, "Fiasco, The American Military Adventure in Iraq."

Rick Francona, I made a little list because I want to challenge you just on the Iranian thing. OK? So here is the Iranian story. They seized hostages, they went into Iraqi waters, they violated the Geneva Conventions, they coerced the hostages into phony confessions. Now they're being portrayed as magnanimous. And on top of all that, they made a ton of money on the higher oil prices. You going to tell me Iran lost?

Lt. Col. FRANCONA: I think they lost politically. They may have made some money on this, but I think the world sees this for what it is. Larry, they engineered this whole thing. I think the IRGC was overaggressive. They went into Iraqi waters, they took these guys, they held them hostage. And these--all these confessions. The only people that would have believed that that was true were maybe some people in Iran. I think that this is a net political loss. And Ahmadinejad used the occasion of the prophet's birthday today to give them the only face-saving way out of this. I think they're lucky they're out of it as they are, but I think, all in all, they lose.

KUDLOW: All right. I'd like to know that Rick is right, Tom Ricks, but I'm not sure because after all, here's Iran. Now they're busting the UN resolutions. They're still weaponizing their nuclear. They're testing and so forth. Then they're still helping Hezbollah and Hamas. They're still putting plenty of their secret guards, their provisional guards into Iraq, killing American soldiers and fomenting mischief. I just don't see Iran paying any penalty or cost right now or in the weeks leading up to this episode.

Mr. RICKS: I like the list you put to Colonel Francona. I would add one more thing to it. They have sent a message, and a very strategic message it is, that people who make trouble for them in Iraq can expect that they will make trouble for these people elsewhere. So if they don't like what the British and Americans are doing to their people inside Iraq, they have shown that they have a means of responding.

TEXT:
Iran's president will free 15 Britons as a "gift" to Britain
Global oil prices plummet on Iran headlines

KUDLOW: Rick Francona, your response to that, because again I--my problem with this, I'm not here to boost Iran. I can't stand Iran. They're a rogue state for heaven's sakes. But what I don't see is them paying any cost, consequences or penalties for all of the things they're doing. The Iraqi mischief, the Hezbollah mischief, now the hostage mischief, now the centrifuge testing, nuclear development mischief. That's my problem with this, Rick.

Lt. Col. FRANCONA: Well, that's what I see here. If you take this one incident, they have to be made to pay a price. Unfortunately, I think you're right they will not be made to pay a price. And I--that is probably one of the things that the British agreed to to get these detainees released. And that was `After this is over, we don't want to have to go to the UN or explain this. It's just going to go away.' But I think someone needs to hold Iran accountable. And the United Nations was trying to do that. But these sanctions just aren't doing it. This incident may galvanize maybe some Russian or Chinese support in the UN. Maybe I'm being too optimistic, Larry.

TEXT:
Iran's Ahmadinejad says he has pardoned UK naval personnel
UK sailors were seized by armed Iranian forces 13 days ago
British captives will be taken to airport after Ahmadinejad presser
Ahmadinejad says major powers cannot deprive Iran of right to nuclear tech
Ahmadinejad threatens to "retaliate" to sanctions over Iranian banks

KUDLOW: Just a quickie, Rick, before I come back to Tom Ricks, as a military analyst and as a former strategist, what price would you like to see Iran pay?

Lt. Col. FRANCONA: Well, I'd like to see the Security Council take some real action, put some teeth into these sanctions and say, `OK, obviously these sanctions are not working.' And I think now after we've seen what they've done, they revert to the same thing they've always done. The did it in Lebanon. They did it against the Americans. They take hostages. If we can get the UN to do some stronger sanctions, they might pay a price.

TEXT:
UK PM Tony Blair: "Welcomes" the news of naval personnel release
Iran official - British naval personnel will be handed over to British Embassy

KUDLOW: All right. Tom Ricks, a quick one on that and then I want to go to Iraq.

Mr. RICKS: Sure. I think that--I was thinking about what a British analyst said to me that the only outfit he's seen that was worse calculating and more miscalculating than the Bush administration on Iraq was the Iranian foreign ministry. So I think the price they may pay eventually is they are pulling tigers by the tail and they may overplay their hand.

KUDLOW: Gentlemen, we've just got two minutes. I want to ask you, Tom Ricks. General Barry McCaffrey just came back from a mission in Iraq. He says--he says that `The General Petraeus strategy is sound and the situation is not hopeless.' Do you agree with that assessment?

Mr. RICKS: Well, I read General McCaffrey's assessment. It was kind of a schizophrenic assessment. Very pessimistic on the one hand, very optimistic in its conclusions. I asked him about that. And he said, yeah, he wrote the first part with his head. He wrote the second part with his heart.

KUDLOW: And would you agree with him it's not hopeless?

Mr. RICKS: It's not hopeless, but anybody who tells you the surge is working must know something that General Petraeus doesn't know because General Petraeus today said it's too early to tell.

KUDLOW: Mmm, interesting. All right. Rick Francona, a quick response on the McCaffrey, and then I want to talk about al-Qaeda's new threat. First, is it hopeless over there in Iraq, Rick?

Lt. Col. FRANCONA: No, it's not hopeless, but I think Tom was exactly right. Following General Petraeus' reasoning, it's too early to tell. I mean, if you put two brigades, two American brigades, three Iraqi brigades on the ground, of course, you're going to see some improvement. But I think, we don't know if this is a permanent improvement if we're successfully buying enough time to get Iraqi forces in there. Otherwise, we're just pushing this problem out into the future.

KUDLOW: Last minute, New York Times lead story a couple days ago. We've been following this story on this program. The resurgence of the al-Qaeda's leadership and operations in the Pakistani badlands and Afghanistan. Rick, do you agree or disagree with The New York Times?

Lt. Col. FRANCONA: I agree that they've reconstituted themselves up on the Pakistani side of that border, but how effective they can be up there I really don't know. They're not operating before as they were before when they owned their own country. Now they're up in the caves hiding over there. They may have reconstituted their structure, but I don't think they've reconstituted themselves as the major threat that they once were.

KUDLOW: Tom Ricks, we just got 15, 20 seconds, agree or disagree with al-Qaeda resurgence a la New York Times.

Mr. RICKS: It's a pretty good summary you just got from Colonel Francona. The worry I'm hearing here in Washington is, look, after 9/11, we killed the majority of their leaders...

KUDLOW: Right.

Mr. RICKS: ...but they've come back and regenerated, and that's a worrisome sign.

KUDLOW: All right. Colonel Rick Francona, Tom Ricks of The Washington Post, gentlemen, thank you ever so much.

Up next, my last word, I want to see these Republican candidates be sharp as a tack and very specific because we're for keeping America great. KUDLOW & COMPANY coming right back for the last word.