Transcript: Secretary of State Hillary Clinton on 'This Week'

STEPHANOPOULOS: Good morning, and welcome to "This Week."

(BEGIN VIDEOTAPE)

STEPHANOPOULOS (voice-over): In her first Sunday interview, the secretary of state.

(on-screen): So is there any room for compromise?

Blunt talk...

CLINTON: There would be retaliation.

STEPHANOPOULOS (voice-over): ... that 3 a.m. call.

(on-screen): Has the president answered it for you?

(voice-over): ... and how Obama convinced her to join his team.

CLINTON: I thought it was absurd.

STEPHANOPOULOS: Hillary Clinton, her first Sunday interview as secretary, only on "This Week."

Then...

OBAMA: There's so much fear, so much mistrust that has built up over the years. But if we choose to be bound by the past, we will never move forward.

STEPHANOPOULOS: The Cairo speech. How was it heard? Will words be followed by deeds? That and the rest of the week's politics on our roundtable with George Will, Claire Shipman, Matthew Dowd, and Cynthia Tucker of the Atlanta Journal-Constitution.

And, as always, the Sunday funnies.

(UNKNOWN): It was a very busy day for President Obama, because he's over in the Middle East. Now, don't worry: Joe Biden's running the country.

(LAUGHTER)

(END VIDEOTAPE)

ANNOUNCER: From the heart of the nation's capital, "This Week" with ABC News chief Washington correspondent George Stephanopoulos, live from the Newseum on Pennsylvania Avenue.

STEPHANOPOULOS: Hello again. We begin with our exclusive headliner, Hillary Clinton.

(BEGIN VIDEOTAPE)

CLINTON: I, Hillary Rodham Clinton...

STEPHANOPOULOS: One year ago today, her fierce campaign against Barack Obama had a classy finish.

CLINTON: Although we weren't able to shatter that highest, hardest glass ceiling this time, thanks to you, it's got about 18 million cracks in it.

(APPLAUSE)

STEPHANOPOULOS: She hasn't been seen on Sunday morning since.

CLINTON: Hello, everybody.

STEPHANOPOULOS: So there was a lot to catch up on when I sat down with Clinton after the president's speech in Cairo.

OBAMA: I've come here to Cairo to seek a new beginning.

STEPHANOPOULOS: Iran, North Korea, Israel. And after all those battles with Obama, did she ever imagine herself in Egypt as his secretary of state?

CLINTON: Never. Never crossed my mind. And what an extraordinary honor to be here, especially for this speech today.

STEPHANOPOULOS: The president has a very high-powered team: Vice President Biden, General Jones, Secretary Gates. You've got envoys for Iran, Afghanistan, North Korea. How do you fit in?

(LAUGHTER)

CLINTON: Well, I...

STEPHANOPOULOS: What is your role, exactly?

CLINTON: Well, my role is as the chief diplomat for the United States of America. And, you know, when I agreed to do this job, I made it very clear to the president that I would be able to run the State Department and USAID and that we would have to forge a team that I think we've done very well, and that I wanted special envoys, because we were inheriting so many hotspot problems that I knew you could never have one person possibly address all of that.

STEPHANOPOULOS: It also gives you the ability to get out of the crisis management and carve out areas where you're really going to take initiative. What are those?

CLINTON: Well, I'm having to do both. I mean, I spend a lot of my time on the problems that you would imagine: Afghanistan and Pakistan, the Middle East, Iran. But I'm also working to create a strategic set of priorities that will guide our efforts.

So, for example, there are specific regional and country-based endeavors that we are teeing up. We are going to work really hard on our relationships with, for example, Indonesia, and Turkey, and India.

We have a strategic and economic dialogue that will start the last week in July with China that Secretary Geithner and I are going to co-lead.

STEPHANOPOULOS: So there's plenty of work to go around?

CLINTON: There's plenty of work to go around, but then there are the transnational problems. I mean, the president asked me to lead the effort on food security. The president also wants us to focus on Haiti. And, ironically, the United Nations...

(CROSSTALK)

STEPHANOPOULOS: ... President Clinton...

CLINTON: ... secretary general asked Bill to be the special envoy. So we're really going to have a united effort by our government and by the international community. Those are just some of the, you know, very specific and more general challenges that we are taking on and managing.

STEPHANOPOULOS: You're also developing a reputation for blunt talk as secretary. You talked about Pakistan abdicating its responsibilities, about the idea that (inaudible) negotiation with North Korea is implausible.

And especially on this issue of settlements with -- with Israel, you were very strong last week; so was the president.

(BEGIN VIDEO CLIP)

CLINTON: He wants to see a stop to settlements, not some settlements, not outposts, not natural growth exceptions.

(END VIDEO CLIP)

STEPHANOPOULOS: I don't know if you've seen the headlines in Israel, headlines talking about the American threat. Publicly, the prime minister is saying that this is just unreasonable, these demands from the United States, and privately he was reported to have said -- and this is a quote -- "What the hell do they want from me?"

CLINTON: Well, George, I think it's very clear, as you heard in the speech from the president here in Cairo, that he wants to focus from the very beginning of his term in office on doing everything he can to try to bring the Israelis and the Palestinians together. You know, we were very close in 2000. And it's heartbreaking to see where we are today. And we can't just stand by and expect time to work its magic.

So that means, as the president said in his speech...

(BEGIN VIDEO CLIP)

OBAMA: This bond is unbreakable.

CLINTON: ... and as he has said on several other occasions prior to it, that we have to do our very best to reassure Israel, to demonstrate our commitment to Israel's security, that the bonds we have are unshakeable and durable.

But we do have a view about Israel's security. We see historical, demographic, political, technological trends that are very troubling as to Israel's future. At the same time, there is a legitimate aspiration of the Palestinian people that needs to be addressed.

STEPHANOPOULOS: So is there any room for compromise on the settlement issue?

CLINTON: Well, I don't think we want to pre-judge the effort. I think that, if you look back, certainly from my perspective, every Israeli leader that I have personally known and others who I have looked at through an historical lens has come to the same conclusion.

Who would have predicted that Ariel Sharon or Ehud Olmert would have reached the conclusions they reached about what was in Israel's best interest? Who would have predicted that even Prime Minister Netanyahu, in his earlier term during the 1990s, would have made some of the decisions he made?

STEPHANOPOULOS: But his team says now that, if you continue to push this, it's going to bring down his government.

CLINTON: We are setting forth our views. Obviously, decisions about how to go forward are up to the Israelis and the Palestinians. But I think it is an appropriate role for the United States -- and, certainly, it is what the president has decided -- to make clear some of the obstacles he sees.

Now, remember, the Israelis made a commitment in the road map in the prior administration.

STEPHANOPOULOS: But they say that includes an understanding for natural growth inside the settlements.

CLINTON: Well, that was an understanding that was entered into, so far as we are told, orally. That was never made a part of the official record of the negotiations as it was passed on to our administration. No one in the Bush administration said to anyone that we can find in our administration...

STEPHANOPOULOS: Not Elliot Abrams? He wrote about that.

CLINTON: Nobody in a position of authority at the time that the Obama administration came into office said anything about it. And, in fact, there's also a record that President Bush contradicted even that oral agreement.

But the fact is that the road map, which was agreed to officially, adopted by the Israeli government, said something very clear about settlements.

So I think that what the president is doing is saying, Look, everybody should comply with the obligations you've already committed to. And for the Palestinians, let's not forget: They must end incitement against Israel. They must demonstrate an ability to provide security.

STEPHANOPOULOS: That's what I wanted to ask you about.

(BEGIN VIDEO CLIP)

OBAMA: It is a great pleasure to welcome President Abbas...

(END VIDEO CLIP)

STEPHANOPOULOS: Abbas was in Washington last week. He had an interview in the Washington Post where he sure seemed to suggest that he doesn't have to do anything right now.

CLINTON: Well, I think you're seeing public positions taken, which is understandable in a process like this. But we've made it very clear to President Abbas what we expect from him, as well.

STEPHANOPOULOS: How about Iran? You were quoted in the papers back in March when you met with the foreign minister of the UAE that you were skeptical of the possibility that diplomacy would work to stall or stop Iran's nuclear ambitions. Are you still that doubtful?

CLINTON: Well, I am someone who's going to wait and see. I mean, I -- I want to see what the president's engagement will bring. We have a team of people who we have tasked to work on this. I think there's an enormous amount of potential for change, if the Iranians are willing to pursue that.

STEPHANOPOULOS: Well, what do you think they want, deep down? You know, you read some of the public declarations by their supreme leader and others saying that they consider nuclear weapons un-Islamic, and yet they continue to pursue the nuclear program.

CLINTON: But, George, one of the values of -- of engagement is, we need to have better information, and maybe about each other, not just about a one-way street of information.

The idea that we could have a diplomatic process with Iran means that, for the first time, we would actually be sitting at a table across from Iranians authorized by the supreme leader to talk with us about a whole range of issues. That gives us information and insight that we don't have.

Of course there's contradiction, because we don't have any really clear sense as to what it is they are seeking. Now, one of the things that you heard the president say is, we understand the legitimate right of nations...

(BEGIN VIDEO CLIP)

OBAMA: ... any nation, including Iran...

(END VIDEO CLIP)

CLINTON: ... to have access to peaceful nuclear energy. If that is at the core of what they want, there are ways of accommodating that that do not lead to a nuclear weapon.

But we have to -- have to test that, and we have to be willing to sit and listen and evaluate without giving up what we view as a primary objective of the engagement, which is to do everything we can to prevent Iran from becoming a nuclear weapons state.

STEPHANOPOULOS: Your own envoy, Dennis Ross, has said one way to strengthen the position of the United States going into these negotiations is to make it very clear that, if Iran used nuclear weapons against Israel or any U.S. ally, that would be met as an attack on the United States, full response. Now, that was your position during the campaign, as well.

(BEGIN VIDEO CLIP)

CLINTON: I would make it clear to the Iranians that an attack on Israel would incur massive retaliation from the United States.

(END VIDEO CLIP)

STEPHANOPOULOS: Is it U.S. policy now?

CLINTON: I think it is U.S. policy to the extent that we have alliances and understandings with a number of nations. They may not be formal, as it is with NATO, but I don't think there is any doubt in anyone's mind that, were Israel to suffer a nuclear attack by Iran, there would be retaliation.

STEPHANOPOULOS: By the United States?

CLINTON: Well, I think there would be retaliation. And I think part of what is clear is, we want to avoid a -- a Middle East arms race which leads to nuclear weapons being in the possession of other countries in the Middle East, and we want to make clear that there are consequences and costs.

Now, let me just put it this way: If Iran is seeking security, if they believe -- and, you know, you have to put yourself into the shoes of the other party when you negotiate -- if they believe that the United States might attack them the way that we did attack Iraq, for example...

STEPHANOPOULOS: Before they attack, as a first strike?

CLINTON: That's right, as a first strike, or they might have some other enemy that would do that to them, part of what we have to make clear to the Iranians is that their pursuit of nuclear weapons will actually trigger greater insecurity, because, right now, many of the nations in the neighborhood, as you know very well...

STEPHANOPOULOS: Because Israel will strike before they can finish?

CLINTON: Well, but not only that. I mean, other countries, other Arab countries are deeply concerned about Iran having nuclear weapons. So does Iran want to face a battery of nuclear weapons countries...

(CROSSTALK)

STEPHANOPOULOS: Can you get those other Arab nations to say that publicly? That was part of the president's theme today.

CLINTON: Well, you know, we've been there a little over four months. And clearly a lot of what we are doing is teeing up our framework for decision-making.

We are aggressively pursuing diplomacy, not as an end in itself, but as a means to try to resolve some of these outstanding and very difficult problems. We are trying to make clear that the United States is of course going to pursue our interests in values, but, frankly, we believe there are ways that we can make them consonant with the issues and values that are important to others, as well.

STEPHANOPOULOS: You know, when I saw President Ahmadinejad last month, he said the U.S. wasn't really walking the walk here, and he cited the idea that President Obama never responded to his initial letter of congratulations. Why not?

CLINTON: Well, I think that President Obama has made very clear that he is going to put forth an open hand, but not as part of an electoral ploy or propaganda.

STEPHANOPOULOS: You have to let the elections play out?

CLINTON: I think, just like in every country, there is a process that takes place during an election. That will be over soon, and then we're going to hope to get a positive process going.

STEPHANOPOULOS: With North Korea, it seems like nothing has worked. Engagement doesn't work; isolation doesn't work. They keep on pursuing their nuclear ambitions. And -- and the problem with North Korea is that they've tried to sell every single weapon they've ever made.

CLINTON: Right.

STEPHANOPOULOS: So what does that mean? How do we stop them now? And what happens if they try to sell nuclear materials?

CLINTON: One of the positive developments, George, in the face of what has been very provocative and belligerent behavior by the North Koreans, is that it has actually brought the members of the six-party process -- Japan, South Korea, China, Russia, the United States -- much closer together in how we view...

STEPHANOPOULOS: But that process isn't going anywhere, is it?

CLINTON: Well, but I think what is going somewhere is additional sanctions in the United Nations, arms embargo, other measures taken against North Korea with the full support of China and Russia.

STEPHANOPOULOS: Including enforcing past resolutions, which give the U.N. the ability to board North Korean ships?

CLINTON: Well, we are -- we are working very hard to create a mechanism where we can interdict North Korean shipments. Obviously, some countries -- not just the ones I named -- but others have some legitimate concerns about setting precedent and the like.

But we are working very hard. I've personally talked with all the foreign ministers, some of them, you know, many more times than, you know, just a couple. We've been in very close communication. Obviously, we're working closely with our team in New York.

We think we're going to come out of this with a very strong resolution with teeth that will have consequences for the North Korean regime.

STEPHANOPOULOS: And what are the consequences if they try to ship nuclear material elsewhere?

CLINTON: We will do everything we can to both interdict it and prevent it and shut off their flow of money.

If we do not take significant and effective action against the North Koreans now, we'll spark an arms race in Northeast Asia. I don't think anybody wants to see that.

And so part of what we're doing is, again, sharing with other countries our calculus of the risks and the dangers that would lie ahead if we don't take very strong action.

STEPHANOPOULOS: Several senators wrote the president a letter just the other day saying that North Korea should go back on the list of states who sponsor terrorism. Will you do that?

CLINTON: Well, we're going to look at it. There's a process for it. Obviously, we would want to see recent evidence of their support for international terrorism.

STEPHANOPOULOS: Do you have any?

CLINTON: Well, we're just beginning to look at it. I don't -- I don't have an answer for you right now.

STEPHANOPOULOS: Because the senators say they never stopped with these actions.

CLINTON: Well, we are -- you know, we take it very seriously. I mean, obviously, they were taken off of the list for a purpose, and that purpose is being thwarted by their actions.

STEPHANOPOULOS: One other issue on North Korea. The trial has begun for the American journalists.

CLINTON: Yes.

STEPHANOPOULOS: And the families of the journalists have come out very clearly and said the only way this is going to be solved is if the United States government gets involved directly. Have you been involved directly in any way?

CLINTON: I have been. I have been involved directly in working with our team as they have made approaches and requests for information through the channels we use with North Korea. The Swedish ambassador in Pyongyang is taking care of our interests there. He has visited both young women, I think, now three times, if I'm not mistaken. I've met with the families.

We have made it clear through statements, both public and private, that we view this as a humanitarian issue...

STEPHANOPOULOS: We were told that you sent a letter saying that the girls didn't mean -- the women didn't mean to go into North Korea and asking for their release.

CLINTON: I -- I have taken every action that we thought would produce the result we're looking for. We think that the charges against these young women are absolutely without merit or foundation. We hope the trial ends quickly, it's resolved, and they're sent home.

STEPHANOPOULOS: Have you gotten any hopeful signs back?

CLINTON: We have gotten some responses, but we're not sure exactly who's going to be making this decision and what the reasons for the eventual decision are.

So we've been very careful in what we've said, because, clearly, we don't want this pulled into the political issues that we have with North Korea or the concerns that are being expressed in the United Nations Security Council. This is separate; it is a humanitarian issue. And the girls should be let go.

STEPHANOPOULOS: It's interesting you point -- you don't know who's going to make this decision. Do you believe these reports that Kim Jong-il has tapped his youngest son as his successor?

CLINTON: We obviously are following this very closely. We -- we don't yet know what the outcome of that decision...

STEPHANOPOULOS: What would that mean?

CLINTON: We don't know. I mean, we -- we -- we would have to wait and evaluate it, the timing of it, who might be, essentially, you know, put in place to supervise him, if he were the -- the choice. We have to evaluate all of that.

STEPHANOPOULOS: This week is also the anniversary of -- the 20th anniversary of the massacre at Tiananmen Square, and you put out a very strong statement on that anniversary. Yet when you went to China earlier this year, you basically said the Chinese know what we think about human rights.

And I guess what I'm trying to get at is, how do you approach that issue? When do public statements make a difference? When should diplomacy be conducted privately? And who's your real audience with these statements?

CLINTON: You know, George, it's such a great question. And there is no one easy answer, because I think so much of it depends upon what our objectives are.

We have made very clear, time and time again, our concerns about religious freedom in China, treatment of Tibet, Tibetan culture. So that is -- we're on the record with that. We've had these, you know, very strong statements that we've made historically, going back years.

And so, of course, we want everyone to know that we still feel very strongly about it, but we also would like to see if there is some way we could actually chip away at Chinese resistance to providing some more at least cultural and religious autonomy for Tibetans. So we -- it's a constant weighing process.

You know, I think a lot of times the public statements can turn out to be counterproductive. They can harden positions. Yet at the same time, the public statements can hearten those who are the dissidents.

So trying to keep that in balance so that we don't ever turn our backs on those who are struggling for the very rights that we believe in so strongly and that we think are universal rights, and yet looking for ways that we can actually get results, not just score debating points or, you know, have somebody say, "Good for you. You made a strong statement."

So what we're trying to do -- and I think you hear it from what the president and I have been saying over the last four months -- is to really focus in on where we can make progress.

STEPHANOPOULOS: A year ago, you bowed out of the presidential campaign, very graceful speech.

(BEGIN VIDEO CLIP)

CLINTON: Life is too short, time is too precious, and the stakes are too high to dwell on what might have been. We have to work together for what still can be.

(END VIDEO CLIP)

STEPHANOPOULOS: You know, it was a bitter campaign. And I'm just wondering: How did President Obama convince you to come on his team?

CLINTON: Well, you know, George, I never had any -- any dream, let alone inkling, that I would end up in President Obama's cabinet. When I left the presidential race, after getting some sleep and taking some deep breaths, I immediately went to work for him in the general election.

I, you know, traveled the country. I worked hard on my supporters. I made the case, which I believed strongly, in making sure that we elected him our president.

And I was looking forward to going back to the Senate and, frankly, going back to my life and representing New York, which I love. And I had no idea that he had a different plan in mind. So when -- when...

STEPHANOPOULOS: Since the primaries.

CLINTON: Well, but I had -- I mean, that was certainly never expected. And after the election, I started seeing little, you know, tidbits in the press. I thought it was absurd. I thought, you know, this is the kind of silly stuff that ends up in the press.

And then, when he called and asked me to come see him and we had our first conversation, I said, "You know, I really don't think I'm the person to do this. I want to go back to my life. I really feel like I owe it to the people of New York." And I gave him a bunch of other names of people who I thought would be great secretaries of state.

But he was quite persistent and very persuasive. And, you know, ultimately, it came down to my feeling that, number one, when your president asks you to do something for your country, you really need a good reason not to do it.

Number two, if I had won and I had asked him to please help me serve our country, I would have hoped he would say yes.

And, finally, I looked around our world and I thought, you know, we are in just so many deep holes that everybody had better grab a shovel and start digging out.

STEPHANOPOULOS: Final question. The Economist magazine said this week that the question you raised in that famous 3 a.m. ad...

(BEGIN VIDEO CLIP)

ANNOUNCER: It's 3 a.m., and your children are safe and asleep. Who do you want answering the phone?

(END VIDEO CLIP)

STEPHANOPOULOS: ... is right back in the center of American politics. Has the president answered it for you?

CLINTON: Absolutely. And, you know, the president, in his public actions and demeanor, and certainly in private with me and with the national security team, has been strong, thoughtful, decisive. I think he's doing a terrific job. And it's an honor to serve with him.

STEPHANOPOULOS: Madam Secretary, thank you very much.

CLINTON: Thanks. Good to talk to you.

STEPHANOPOULOS: We will be right back with "The Roundtable" and "The Sunday Funnies."

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: I thought it was very important to come to the place where Islam began.

Just as Muslims do not fit a crude stereotype, America is not the crude stereotype of a self-interested empire.

There are those who insist that the Holocaust never happened. This place is the ultimate rebuke to such thoughts.

The sheer improbability of this victory is part of what makes D-Day so memorable.

GORDON BROWN, U.K. PRIME MINISTER: And so next to Obama (sic) Beach, we join President Obama in paying particular tribute.

(END VIDEO CLIP)

STEPHANOPOULOS: Gordon Brown renames Omaha Beach, about the last thing he needs with his political troubles back home. We bring in "The Roundtable" to talk about the president's trip and his speech in Cairo. George Will is here, as always. Claire Shipman of ABC, also the author of a great new book called "Womenomics." Look at that bright yellow cover. Make sure you get that in your bookstores. Matthew Dowd, former Bush strategist, also strategist for many Democratic candidates. And Cynthia Tucker, from The Atlanta Journal-Constitution, also our latest THIS WEEK contributor, welcome.

TUCKER: Thank you.

STEPHANOPOULOS: So let me begin by showing just a little bit more of the president's speech in Cairo. I guess one of the themes he had was that everyone involved in these issues had to say the same things in public that they've been saying in private.

(BEGIN VIDEO CLIP)

OBAMA: There must be a sustained effort to listen to each other. To learn from each other. To respect one another. And to seek common ground. As the holy Koran tells us, "be conscious of God and speak always the truth."

STEPHANOPOULOS: Now, George, the White House believed, with his blunt talk that they believe the president had for all sides in the conflict, he especially broke through with young Muslims around the world, and set up this image of the United States as an honest broker in these conflicts. What was your reaction?

WILL: By stressing the fact that there has been a terrible misunderstanding on all sides, he says, he suggests that harmony is the natural condition between nations and that if we can just break through the misunderstandings things will go swimmingly.

I don't think there's a page of history that confirms that. It was good of him to say that Islam was not the problem. George Bush said that on September 17th, 2001. He said Islam is peace. And in some of his attempts it seems to me to placate Arab enemies of Israel, he went way over the line.

For example, comparing the Palestinians to slaves, cast the Israelis as enslavers. And when he said millions wait in refugee camps, he ignores the fact that there were -- estimates vary widely between 7 million and 20 million displaced people and refugees in Europe at the end of the Second World War, 10 years later there were none. Those camps are kept there for a propaganda reason.

TUCKER: Well, I didn't see the speech quite the same way that George did. I didn't think that the president was quite as naive suggesting that if our misunderstandings -- our misunderstandings are standing in the way of world peace. I didn't think he was that naive.

But let me just talk a moment about how effectively the president used his biography. It is, after all, just coincidence that an African-American with Muslim heritage has been elected the first black president of the United States.

But he used that extremely effectively. He talked about his Muslim grandfather. He talked about having spent part of his childhood in Indonesia. He talked about the Muslim call to prayer and how appealing that was to him in his childhood. And I think that helped to get the ear of the young Muslims that you were talking about earlier.

STEPHANOPOULOS: And I was in the room, and where he got the most palpable response was when he mentioned Koran, when he did cite those roots, but also in his pronunciation. The things like the holy Koran and Muslim, using the Muslim pronunciation really did work.

Matthew, some critics here at home have said the president took it too far. Chris Caldwell in the Financial Times calls it "the politics of self-abasement." That it was too placating. We've heard some say that this was an "apology tour," people citing especially the president acknowledging the United States' role in the overthrow of the Iranian government in 1953.

Any concern that he went too far and that could hurt him here at home?

DOWD: Well, I think, you know, some people have said, it's like, what is this, like a "hugs not terrorism" tour? Like let's all get together and hug and we'll think that's going to solve the problem.

I think it's better to have a conversation -- to begin the conversation. I think what the president understands is all of these conflicts that circulating around Iran, Iraq, Afghanistan, the Middle East, all of it, is all part of one broader issue. And that is our relationship with the Muslim world and the Muslim world's relationship with us.

But I think one of the things that we forget is actions will test whether or not this thing is credible and how this is going to turn out. But Bill Clinton had a lot of great conversations with a lot of people. And had -- actually his rating among the Arab world is better than Barack Obama's. We were still attacked numerous times in the Clinton presidency and then right after Bush took office, we were attacked again, having nothing to do with Bush or his conservatism.

That's the problem is many people have shared these great words and had these great conversations, but in the end, the actions haven't stopped.

SHIPMAN: And you know, George, it's interesting, because the administration itself I think is somewhat concerned that this speech is being interpreted as a slap at Israel. And they're saying behind the scenes, we're afraid people have missed the push he was giving both to the Palestinians and the larger...

STEPHANOPOULOS: And that's why within France, yesterday, the president made sure to talk about the pressure he wanted to put on the Palestinians as well.

SHIPMAN: Well, exactly. And they're saying, look, he has put significant pressure on the Palestinians. He's asking, you know, other Arab countries to make the step, recognize Israel right away. This was not simply about pressuring the Israelis.

But I think the reason it is being interpreted that way, is this is the first time we've heard language like this since James Baker, really. I mean, let's be realistic.

STEPHANOPOULOS: And the whole run-up to the speech was all about the settlement freeze. We mean it, Israel is going to have to stop on the settlements.

SHIPMAN: It's a change.

STEPHANOPOULOS: And that is a change. And, you know, I do think that the White House, George, started to get a little concerned that it went too far. They wanted that all before the speech. They wanted to break through to the Muslim world, and now they're reeling from it, as they're sending George Mitchell to the region this week to try to actually get the deal.

WILL: Well, the settlements resulted from the '67 war where Israel was attacked and occupied territory from which aggression occurred. But hostility, implacable hostility to the existence predated 1967.

We're also ignoring the fact that when Israel was created in 1948, no Palestinian state was invaded, no Palestinian state destroyed. There was no Palestinian state. Palestine was a geographical expression from the time the Romans left to the time that the British rule came there.

And the idea that the settlements are the key to Israeli-Palestinian harmony and that that is the key to the larger regional settlement, from Pakistan through Iran and Iraq and all of the rest is...

(CROSSTALK)

STEPHANOPOULOS: Well, there is -- we've got to unpack a lot there. That may be true. But right now, Cynthia, there's no question the Palestinians will not sit down with the Israelis unless they get Netanyahu saying, I believe in a two-state solution, and unless they get something approximating a settlement freeze, and we're not sure where there's any room for compromise or not.

TUCKER: I think President Obama was making an effort in his speech to show that U.S. had returned to its role -- traditional role, as an honest broker in the region. Throughout the Muslim world, we were believed to have only sided with Israel over the last eight years.

Whether that's fair or not, whatever Israel did, we supported. So I think the president believed it was very important in advance of the speech to push Netanyahu on settlements to show that we returned to that role.

And let me say that I think it's very important to note what didn't happen domestically around settlement. Criticizing Israel had become the third rail of American politics. You did that at risk as an American politician.

But when Netanyahu was here a few weeks ago, he met a united front from Jewish members of Congress, from heads of Jewish organizations agreeing with the president that he needed to freeze settlements.

STEPHANOPOULOS: You know, it's interesting, it's sort of -- go ahead.

DOWD: One thing, I mean, I think it's -- to keep in mind is that if you think about where we've been in the Middle East since the mid-1960s, we've had nine or 10 presidents, liberals, conservatives, various places, various relationships with the Middle East. There has been 10 or 11 prime ministers of Israel, liberal, conservative, various stands on various issues.

We, as of yet, have failed to reach a Middle East peace. In the end, I believe, when you have all of that change in the United States and Israel and still cannot bring it to bear, it's contingent upon the Palestinians. If there's going to be peace in the Middle East, it's going to be totally contingent on the Palestinians' relationship with the United States and Israel.

STEPHANOPOULOS: And...

SHIPMAN: A couple of things that the administration is saying, first, they've said since the speech, they've already heard promising things from the Israelis. Not from anybody else yet, but the Israelis, not enough though. But what...

STEPHANOPOULOS: Netanyahu is going to come out for the two-state solution at minimum.

SHIPMAN: Yes, yes. And I think what they're hoping, somebody said, it's a bad analogy, but it's like casting a Hollywood movie. All of this has to happen at the same time. You get Brad Pitt in the movie by saying Tom Cruise.

(LAUGHTER)

SHIPMAN: You get Tom Cruise by -- and it all literally has to happen in concert. And what they're pushing for is these other steps...

(CROSSTALK)

STEPHANOPOULOS: I'm imagining Brad Pitt and Tom Cruise around a table with George Mitchell. You're exactly right. Because what they think then is that if Israel comes out for the two-state solution, the Palestinians will sit down and the other Arab nations, which is also key, will...

(CROSSTALK)

SHIPMAN: Recognize Israel.

WILL: But in July 2000 at Camp David, Bill Clinton got Arafat together and Ehud Barak together, and Ehud Barak gave probably more than the Israeli public would have taken, and the Palestinians said no.

The problem is never that Israel is being provocative, it's that Israel's being is provocative to these people. And until Israel gets an interlocutor, no progress is possible.

STEPHANOPOULOS: We're going to switch topics with that right now because I want to get back what was happening on the home front as well. Before the president left this week, he found another Republican, John McHugh, congressman from New York, the ranking Republican on the House Armed Services Committee to leave the House and become his secretary of the Army.

Here's Congressman McHugh.

(BEGIN VIDEO CLIP)

REP. JOHN MCHUGH (R-NY), ARMY SECRETARY NOMINEE: Nothing more than the latest in a growing line of individuals of many different backgrounds, differing political persuasions who have been provided by President Obama the chance to heed, to answer new, important, and challenging problems facing this country.

(END VIDEO CLIP)

STEPHANOPOULOS: That growing line, Matthew Dowd. Ray LaHood, Jim Leach now at the National Endowment for Humanities. Of course, Governor Huntsman is going to be ambassador to China; Arlen Specter now a Democrat. Clear strategy here by the White House. Does it have any deep impact?

DOWD: Well, it's interesting. It's a very similar strategy that George Bush tried to do, having been a Democrat and come to work for the president who was a Republican at the time.

To me, it's -- you're trying to do a couple of things at once. It feels a lot like the New York Yankees going to get a Red Sox player and then say, why don't the Red Sox like us? That's not going to happen. Republicans not going to like Barack Obama because he went and got some Republicans to side with him.

I think it's two-fold, and we'll see if he's successful. First is, it sends a signal to independent voters that here's a president that's willing to try to reach across the divide and get -- not to get Republicans, but to try to get independent voters in the country.

The second thing it is, I think it does help demonstrate that Barack Obama is interested in diversity of opinion within the decision-making process, which was a huge problem and the perception that people had of George W. Bush. He had no interest -- people thought he had no interest in getting diversity of opinion. At least, Barack Obama, by doing this, is demonstrating that he wants it.

WILL: It sends another signal. When a ranking member of a committee says I'm leaving the committee, that tells all the members of his party in Congress, he does not expect to be chairman anytime soon, that the Republicans are in the minority for the foreseeable future. And that's a very dispiriting (inaudible).

STEPHANOPOULOS: And it not only opens up a seat, Cynthia, in your state -- there are only two Republican House members left in New York state right now. I think the other thing it does is force the Republican Party into this box of being a Southern conservative party.

Look at everybody that's come out. Specter, Leach, LaHood -- Northeast, Midwest. Huntsman is from the West, but he was saying that the party had to change its message.

TUCKER: And I think that forcing out or inviting out Republican moderates is not only bad for the Republican Party, I think it's bad for the country.

I'm from the Deep South. I grew up in Alabama. I live in Atlanta, Georgia, now, and I can tell you that Republicans now run for state and local office by moving further and further to the right. There's a competition to see how far you can get to the right to appeal to the most rightward elements of the base. And I just think that is a bad thing for the party.

SHIPMAN: And, again, a brilliant strategy, I think, by the White House. It's just if you can demonstrate bipartisanship and make the Republican Party look in disarray at the same time, why not? I mean, cynically, it's just a smart move.

DOWD: I agree it's a smart move. I also think it has a much bigger profound effect. The Republicans are in disarray, and they can't seem to settle on any leader, any issue, have become a minority party in this country, really, truly a minority party at this time. That it is not what the American politics needs. We need two vibrant political parties that are able to present competing visions and then fight it out over with the American public.

Right now, we have one vibrant party that is very strong and one party that's in total disarray, as I say. And so there's not this conflict of ideas that has enabled the American public to sort of see out there so they can pick and choose from it. That's a huge problem.

STEPHANOPOULOS: One place it might come up, though -- and I just -- we only have a second on this, but I wanted to show something that came up this morning on health care. The president gave a speech on health care yesterday from Europe, his radio address, where he said, you know, we've got to get to work on health care.

That drew a pretty angry response from the ranking Republican on the Senate Finance Committee. By Twitter today, he said, "President Obama, you've got nerve, while sight-seeing in Paris to tell us time to deliver on health care. When you are a hammer, you think everything is a nail. I'm no nail."

I'm not sure what that means for health care, but there's a vibrant Republican Party right there.

(LAUGHTER)

STEPHANOPOULOS: The Republicans also trying to figure out how to deal with Judge Sotomayor. She had her first meetings on the Senate this week. She released her questionnaire, and she got this kind of response from Republicans Lindsey Graham and Susan Collins after their meetings. They were talking about her wise Latina comment, which has gotten so much attention.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM, R-S.C.: It's not exactly makes me feel good to hear a sitting judge say that. But do I think in her heart that she hates white people? No.

SEN. SUSAN COLLINS, R-MAINE: I'm still uncomfortable that she made the statement, particularly as a sitting judge. I can understand her explanation.

(END VIDEO CLIP)

STEPHANOPOULOS: Now, George, at the same time, Newt Gingrich, who had called those comments racist, he called her a racist for saying them, stepped back from that, trying to focus on this issue of judicial impartiality. I think that's where the senators were going as well. That seems to be the ground they want to stand on with Sotomayor.

WILL: I think they know they're standing on ground that is going to be in the end lost. She's going to be confirmed. And therefore, quite legitimately, they want to use these hearings as a teaching moment for the American people and say this is what we believe, this is what they believe. That's fine, but lowering the decibel matters.

STEPHANOPOULOS: Clearly, Matthew, they're lowering the decibel, but I wonder on the politics of the vote on this one. Obviously, you could say a yes vote for Sotomayor if they can bring themselves around to that would show this openness to Latinos and Hispanics. On the other hand, a yes vote gives up some ground for the next Obama appointments that are going to come down. They're going to have narrower ground on which to fight whoever he comes up with next.

DOWD: Well, I think in the end, the Republicans made a mistake at this in the beginning, when Newt Gingrich and Rush Limbaugh made -- personalized it and said some ridiculous things, it became a side show. If it's about judicial philosophy, the Republicans stand for the rule of law; the Democrats for Barack Obama -- it doesn't, and if it's about Barack Obama and not about Sotomayor, then I think the Republicans set it up -- even if they lose -- set it up to say this is what we stand for, this is what they stand for.

They cannot -- the Republicans cannot personalize this with the place they are, not only in the country...

STEPHANOPOULOS: There should be a vote now?

DOWD: I think in the end, they should vote what they believe is the right judicial philosophy, but don't personalize it as an attack on Sotomayor.

SHIPMAN: I think it's also hard when you look at Sotomayor's record and look at the cases, it's very hard for people to make the case that she's a typical, you know, elite liberal judicial philosopher. I mean, really, she's not. Her cases go back and forth. It's going to be hard for the Republicans to try to pin down what that means. She's tended to give -- to be tough on crime, to give police the benefit of the doubt.

You know, we spent time with her brother in the Bronx last week, Juan Sotomayor, and one thing he talked about was that she was always brilliant from the start, but did not hesitate to use her fist to send him on those Bronx streets. And I think when you, again, you have that background, it's not surprising...

STEPHANOPOULOS: (inaudible) experience is going to come in handy.

Also on guns, you know, the NRA, Cynthia, was looking at coming after this nomination. And yet, one of the judge's opinions on the Second Amendment was reinforced this week by one of the most conservative panels in the country out of Illinois, including Frank Easterbrook and Richard Posner, much harder for the NRA to make this case now?

TUCKER: Absolutely. As Claire just said, her opinions don't show -- she's certainly liberal. She's called herself liberal, but she's nobody's knee-jerk radical. In fact, she often sides with the prosecution in cases, probably from her experience as a young prosecutor. And I think that's the reason we're hearing so much about her speeches. If you look at her record on the bench, there's just not that much to criticize.

STEPHANOPOULOS: Another visitor to Washington this week, Nancy Reagan. Nancy Reagan came for the unveiling of the Reagan statue in Statuary Hall of the Capitol this week. It was quite moving. Take a look as she accepted the unveiling.

(BEGIN VIDEO CLIP)

NANCY REAGAN, FORMER FIRST LADY: The last time that I was in this room was for Ronnie's service. So it's nice to be back under happier circumstances.

(END VIDEO CLIP)

STEPHANOPOULOS: And a happy lunch the next day. There she was with Michelle Obama, the new first lady. They had lunch up in the private quarters. And Claire, give us a chance, I guess -- we're now about five months in -- to reflect on what Michelle Obama is trying to do as first lady, how she's trying to be a different kind of first lady.

SHIPMAN: You know, it's interesting. We -- I really think Michelle Obama is -- she has been so successful with her public image, in large part because she's our first post-feminist first lady. She's not somebody who's worried about whether her image is going to be too traditional, whether she's not working anymore and she has to take on a more meaty role. She's somebody who seems...

STEPHANOPOULOS: (inaudible) we saw with Hillary Clinton.

SHIPMAN: Exactly. With Hillary Clinton. She's not Laura Bush, she's not Hillary Clinton. She's comfortable being a Harvard-educated lawyer who is spending time focusing on healthy eating and her children, and nobody doubts that if she wants to get back into the workplace, she can. It's one of the themes we talk about in "Womenomics." In fact, we have part of an interview with her in the book, but that is that women are -- there's a new horizon for women now in the workplace.

TUCKER: Well, I can't help but reflect on all of the negative things that were said about Michelle Obama back during the campaign. She was supposed to be so angry. She was supposed to hate America. She was supposed to hate white people. And now, we have a first lady whose popularity, according to some polls, is even higher than her husband's. She has become exactly what I thought she would be. She's younger than me, but I recognize -- I recognize the post-feminist response of a woman who's very comfortable combining roles.

STEPHANOPOULOS: And she's gotten two great date nights in the last two weeks. New York last week and Broadway, Paris this week and the Eiffel Tower.

That's all we have time for right now. This roundtable is going to continue in the green room on abcnews.com.

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