Full Transcript: Defense Secretary Leon Panetta

TAPPER: President Obama recently said that -- recently told John Brennan, his counterterrorism adviser at the White House that he wanted a little bit more transparency when it comes to drones, which are the -- is one of the approaches that you're alluding to in Yemen, and of course in Pakistan.

Dennis Blair, the former director of national intelligence wrote the following in "The New York Times," quote, "As the drone campaign wears on, hatred of America is increasing in Pakistan. American officials may praise the precision of the drone attacks, but in Pakistan, news media accounts of heavy civilian casualties are widely believed. Our reliance on high-tech strikes that pose no risk for our soldiers is bitterly resented in a country that cannot duplicate such feats of warfare without cost to its own troops."

And "The Times of London" reported last week that the civilian casualties in Yemen as a result of drone strikes have, quote, "emboldened Al Qaeda."

Is there not a serious risk that this approach to counterterrorism, because of its imprecision, because of its civilian casualties, is creating more enemy than it is killing?

PANETTA: First and foremost, I think this is one of the most precise weapons that we have in our arsenal. Number two, what is our responsibility here? Our responsibility is to defend and protect the United States of America.

There are those who have no other intent but to attack this country. We saw three potential bombers that were trying to get on planes to come here and attack this country. We've seen past attacks taking place. We've seen those that continue to – to indicate that they're planning every day to try to attack this country.

We have got to defend the United States of America. That's our first responsibility. And using the operations that we have, using the systems that we have, using the weapons that we have, is absolutely essential to our ability to defend Americans. That's what counts, and that's what we're doing.

TAPPER: Just to clarify, three potential bombers? I know there's Abdulmutallab, there's the incident recently --

PANETTA: And there were the cartridge bombers --

TAPPER: Oh, the cartridge bombers. Okay.

PANETTA: -- at the same time.

TAPPER: Let's turn now to Iran. Our diplomats were in Baghdad this week negotiating as part of the international coalition, trying to convince Iran to stop its suspected nuclear weapons program. But we recently saw an Iranian diplomat seemingly bragging to "The New York Times" about out-negotiating us. David Sanger has a new book out in a week called "Confront and Conceal" in which he writes, quote, "White House officials blanched a bit in December 2011 when Leon Panetta suggested that despite all the roadblocks that Washington had thrown in the way, Iran could move to a weapon fairly quickly if it made a political decision to do so." Quote, "'It would be sometime around a year they would be able to do it,' Panetta said. Perhaps a little less, the one proviso is that they have a hidden facility somewhere in Iran in which case a nuclear weapon may be within their reach sooner."

The U.N. Atomic Agency has found evidence at an underground bunker in Iran that could mean the country has moved closer. This is just news in the last few days.

Given the urgency of the timeline you describe in the Sanger book that you told to the White House last December, are they not just running out the clock? And are these negotiations once a month enough?

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