Courtesy Fox News. This is part I of the interview. Part II will air tomorrow evening, part III on Wednesday.

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This is a partial transcript from the September 27, 2004 edition of “The O’Reilly Factor,” that has been edited for clarity.

Watch Part II and III of the interview on Tuesday, September 28 and Wednesday, September 29 at 8 p.m. and 11 p.m. ET! Catch “The O’Reilly Factor” weeknights at 8 p.m. and 11 p.m. ET and listen to the “Radio Factor” weekdays on Westwood One.

BILL O‘REILLY, HOST: Okay. First of all, I want to thank you for talking with me.

PRESIDENT GEORGE W. BUSH : [chuckles]

O’REILLY: So few people will.

PRESIDENT BUSH: Well, there’s, uh, it’s a big gamble on my part.

O’REILLY: No, it isn’t, not really though. You, we talked four and a half years ago,

PRESIDENT BUSH: I’m teasing.

O’REILLY: Uh, yeah, when you,

PRESIDENT BUSH: I, I enjoy, I enjoy how you interview people, and I uh, appreciate you giving me the chance to come on and have what we say in Texas, just a visit.

O’REILLY: Yeah. We’re going to have a visit here. I’ve got fifteen questions for you. If they’re dumb, tell me they’re dumb. Because the audience will like that.

PRESIDENT BUSH: [Chuckles]

O’REILLY: If they’re dumb questions, look that’s just dumb. Um, the first one is, according to a poll taken by the Coalition Authority (search) last spring, only five percent of the Iraqi people see the United States as liberators. Are you surprised they don’t appreciate the American sacrifice more?

PRESIDENT BUSH: I, I think they’re beginning to, appreciate the sacrifice, because the country is getting better. It’s tougher than heck right now, because Zarqawi (search) and some of these former Baathists are killing innocent Iraqis and killing our soldiers in order to try to get us to leave. Um, I also saw a poll where it said by far the vast majority of the Iraqis believe the world is getting better. And that’s positive. In other words, people are beginning to see progress. Electricity is better, schools are opening, hospitals are running. Um, I think when it’s all said and done, the Iraqis are going to look back and say thank God for America.

O’REILLY: How long is it going to take before that happens, do you think?

PRESIDENT BUSH: You know, it’s uh, as soon as possible. Now, I think the elections are going to have uh, uh you know, a very positive effect, and they take place in January, and, but the people want to vote.

O’REILLY: But can they vote when people are being blown up,

PRESIDENT BUSH: Yeah.

O’REILLY: And these guys are threatening them, then they vote,

PRESIDENT BUSH: That’s when you’re supposed to vote. You’ve got to stand tough with these terrorists. You cannot allow the terrorists to dictate whether or not a society can be free or not. Do you remember what happened in Afghanistan when the Taliban pulled the four women off the bus and killed them because they had voter registration cards? I think there had been about three million Afghan citizens who had registered at this point in time. A lot of people said, well, the elections look like they’ve got to be over in Afghanistan, because the Taliban is, too violent to allow the elections to go forward. Today ten million citizens, [OVERLAPPING VOICES] in that country have registered to vote, forty percent of whom are women, which is a powerful statistic.

O’REILLY: The South Vietnamese didn’t fight for their freedom, which is why they don’t have it today.

PRESIDENT BUSH: Yeah.

O’REILLY: Do you think the Iraqis are going to fight for their freedom?

PRESIDENT BUSH: Absolutely.

O’REILLY: You do.

PRESIDENT BUSH: No question in my mind, they will, you bet. I was with Prime Minister Allawi (search) yesterday, he is a tough guy. He is a strong leader. He believes the future of Iraq is the future of freedom, and he tells me that, you know that these places where they go bomb the recruits, the people trying to sign up to serve in the army or the police, the next day, more recruits come.

O’REILLY: Okay.

PRESIDENT BUSH: Because people want to defend their country. I believe that. You know why I believe that, and this is really important, uh, uh, it’s because, I believe everybody yearns to be free. I believe Muslims yearn to be free. And I, and this is tough, look, no question it’s tough times. But if we send mixed signals, if we waver, the times will be tougher. That’s what the terrorists are watching, they’re watching us like hawks.

O’REILLY: What happened to Saddam’s chemical arsenal, do you know?

PRESIDENT BUSH: No. I don’t. We thought we’d have stockpiles, uh, we do know he had the capability of making weapons. And that capability could have been passed on to terrorists, and that was a risk, after 9/11, we could not afford to take.

O’REILLY: No I understand that. But you, to this day, don’t know what happened to his chemical weapons. He didn’t tell us, and, and,

PRESIDENT BUSH: No. Not yet.

O’REILLY: He hasn’t given us much, has he?

PRESIDENT BUSH: No, he, well he doesn’t have anything, you know, doesn’t have anything to, to gain by giving us much, I mean, he’s, he’s going to go on trial, and the Iraqis will lay out a case, and, you know, I mean, why would he, why would he tell the truth?

O’REILLY: “The Wall Street Journal” says, and that’s a conservative paper, that uh, the Defense Department and the Pentagon wasn’t aggressive enough in getting al-Sadr and then crushing Fallujah.

PRESIDENT BUSH: Yeah.

O’REILLY: Is the “Journal” wrong?

PRESIDENT BUSH: I, I think this uh, I think that the, government of Iraq, Allawi, did a good job in Najaf with Sadr. In other words, they now control the shrines, and they did so in a way that he, Allawi, thought would be best for the political process. In other words, there’s a dual track here. There’s a political process going forward, and a security operation going forward. And the two must be parallel, and uh, Allawi made the decision that the best operation in Najaf uh would be to, the way we handled it, and uh, if they’re saying that maybe last fall we should have moved on Sadr, it’s a judgment call that you know, history will have to look back on.

O’REILLY: Fallujah? Should we have crushed it when we could have?

PRESIDENT BUSH: Well, there again, there was a dual track with uh, a political process going forward, a lot of people on the ground there thought that if we’d have gone into Fallujah at the time, the uh, interim government would not have been established, and if the government would not have been established, we wouldn’t have been able to transfer sovereignty. I happen to think the transfer of sovereignty is a key moment in this, history of a free Iraq. The reason I believe that is that the Iraq people are going to follow uh Iraqi leadership, not U.S. leadership. And uh, Prime Minister Allawi’s been there for about two and a half months, nearly three months, he’s getting his feet on the ground, he’s establishing a government, they’re training police, they’re training army, they’re beginning to move out in, in places like Sumaria and Najaf in order to make the place a more peaceful, peaceful country.

O’REILLY: The mission accomplished statement in May 2003, if you had to do it all over again, would you not have done it?

PRESIDENT BUSH: Uh, well first of all, the statement said, Thank you for be, serving in Afghanistan and Iraq, thank you for being on one of the largest, longest cruises in our nation’s history. Thank you for serving our country, and we’ve still got tough work in Iraq. Now I’m, I’m going to go and thank our troops every chance I get.

O’REILLY: But the press spinned it, you know how they spinned it.

PRESIDENT BUSH: Well, they spin everything.

O’REILLY: Me too.

PRESIDENT BUSH: Well, [chuckles] I understand, you know, maybe you deserve it more than me, but nevertheless, [chuckles] look I, I,

O’REILLY: [OVERLAPPING VOICES] You’ve taken some heat for that.

PRESIDENT BUSH: I take heat for a lot of things, and uh,

O’REILLY: Would you do it again?

PRESIDENT BUSH: You mean have the sign up there?

O’REILLY: No, no, but go in there with the flight jacket,

PRESIDENT BUSH: Absolutely.

O’REILLY: You would.

PRESIDENT BUSH: Of course. I’m saying to the troops, on this carrier and elsewhere, thanks for serving America. Absolutely.

O’REILLY: Okay.

PRESIDENT BUSH: And by the way, those sol, those uh sailors and airmen, loved seeing the Commander in Chief.

O’REILLY: Oh, that’s [INAUDIBLE]

PRESIDENT BUSH: These kids had been on a very long cruise. They’d been on a cruise to both, in two theaters of war now, Afghanistan and Iraq. I flew out there, and said, thanks. Thanks on behalf of a grateful nation. You bet I’d do it again.

O’REILLY: This is really a tough one.

PRESIDENT BUSH: Okay. [chuckles]

O’REILLY: Iran. Uh, said yesterday, hey, we’re going to develop this nuclear stuff, we don’t care what you think. You ready to use military force against Iran if they continue to defy the world on nuclear?

PRESIDENT BUSH: My hope is that we can solve this diplomatically.

O’REILLY: But if you can’t.

PRESIDENT BUSH: Well, let me try to solve it diplomatically first. All options are on the table, of course, in any situation. But diplomacy is the first option.

O’REILLY: Would you allow Iran to develop a nuclear weapon?

PRESIDENT BUSH: We, we are working our hearts out so that they don’t develop a nuclear weapon, and the best way to do so is to continue to keep international pressure on them.

O’REILLY: Is it conceivable that you would allow them to develop a nuclear weapon?

PRESIDENT BUSH: Uh, no, we’ve made it clear, our position is that they won’t have a nuclear weapon.

O’REILLY: Period.

PRESIDENT BUSH: Yeah.

O’REILLY: A “Time” magazine investigation says, three million illegal aliens crossed the Mexican border, and we talked about this four and a half years,

PRESIDENT BUSH: We have, I know, it’s a issue that you’re concerned about.

O’REILLY: Every year, three and a half million illegals come over. Why can’t the federal government control that?

PRESIDENT BUSH: Well, as you know, as the governor of Texas, I was very aware of this issue, there is a long border, that makes it hard to control. We have beefed up places along the border to try to stop the process of, of, of uh, of uh,

O’REILLY: With all due respect though, it’s not working.

PRESIDENT BUSH: Well,

O’REILLY: Three million people.

PRESIDENT BUSH: It’s working a little better, they’re doing a pretty good job down in Arizona, which is the main border crossing, but I was trying to get my words here for a minute. Trying to give you some facts that would, I think there’s a thousand more border patrol agents along the border, we’re modernizing border techniques, we’re using better surveillance methods to stop this, crossing at the border. Now look, people are coming up because they want to work. You know, that, family values don’t stop at the border.

O’REILLY: Absolutely,

PRESIDENT BUSH: If you can make fifty cents in the interior of Mexico, and five bucks in uh, the interior of the United States, you’re coming for the five bucks, and they’re poor.

O’REILLY: Ninety percent of them are, but ten percent are bad guys.

PRESIDENT BUSH: Well, look, look,

O’REILLY: A lot of bad guys coming here.

PRESIDENT BUSH: I don’t know how you got the ten percent number, maybe,

O’REILLY: The border patrol you know, incarceration, violent crime, that,

PRESIDENT BUSH: No question about it. It is a ter, serious issue. I happen to believe the best way to enhance the border is to have temporary worker cards available for people. And uh, I think it’s best for the employers who are employing these people, I think it’s best for the employees that are trying to find work. I think the long-term solution for this issue on our border is for Mexico to grow a middle class, that’s why I believe in NAFTA (search),

O’REILLY: We’ll be in the grave.

PRESIDENT BUSH: I don’t think so, it’s happening. Look, you, I wish I could have taken you down there and shown you the, the northern tier of states in Mexico, uh, ten years ago compared to today. I mean, it, it’s happening.

O’REILLY: You,

PRESIDENT BUSH: Free trade helps lift, lives, free trade develops commerce, free trade gives people a chance to realize their dreams. And so long as the wage differential is as big as it is, and so long as moms and dads feel the, necessity to feed their children, they’re going to come and try to make a living.

O’REILLY: So you’re not going to military militarize the border to stop,

PRESIDENT BUSH: No, we’re going to use the border patrol and beef it up, and make it, give it better technologies and better equipment to do its job.

O’REILLY: Okay. You know a lot of people are not going to like that answer, you know that.

PRESIDENT BUSH: Well it’s a, a truthful answer.

O’REILLY: Okay. Um,

PRESIDENT BUSH: I mean, as opposed as to what, putting a military on the border,
O’REILLY: Yeah, military to back up the border patrol, to just stop the, the, rampant,

PRESIDENT BUSH: No, I think the best way to do it is to give the border patrol the assets it needs to do its job.

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