'Meet the Press' transcript for June 21, 2009

MR. DAVID GREGORY:  This Sunday, a violent crackdown in Iran.  Officers fire tear gas and wield batons as demonstrators stay in the streets, defying warnings from the supreme leader, who ordered the end of protests against the re-election of Mahmoud Ahmadinejad.  After first being accused of a timid response, President Obama now warns Iran to stop its "unjust actions," claiming the whole world is watching.  This morning, the debate over what's next and what role the U.S.  should now play.  Our guests:  a vital voice from the Middle East, Israeli Prime Minister Benjamin Netanyahu; then, two respected former senators, Sam Nunn of Georgia and Fred Thompson of Tennessee, on the security threats facing the U.S.  as well as the escalating debate over spending and the deficit as the president pushes sweeping healthcare reform. Finally, the politics and the polls.  Is the Obama agenda in trouble?  Our political roundtable with NBC's Chuck Todd and Fortune's Nina Easton.

But first, still breaking news out of Iran, defiance and violence in the streets of Iran.  We go now live to NBC's Tehran bureau chief, Ali Arouzi.

Ali, what evidence is there now of a violent crackdown on these demonstrators? The regime now calling demonstrators terrorists.

MR. ALI AROUZI:  That's right, David.  There was a massive clash last night between protesters and an enormous amount of security forces on the street last night.  The protesters who'd come out were in direct defiance of orders from the supreme leader not to protest on the streets anymore, but they defied this and they were out on the streets.  Tear gas, water cannons were used, and there were reports of live ammunition being used as well.  Today state TV reports that, that 13 people were killed in last night's clashes.  But we're hearing other reports this number is, is higher, but we can't verify that.

MR. GREGORY:  You have been on the scene since this all started.  But talk about how difficult it is to get this story out.  You're broadcasting this morning from state television, this report is being monitored.  We've seen the social networks really being a cool--critical voice in getting the story out. How difficult is it to monitor what's happening?

MR. AROUZI:  It is difficult to monitor what's happening.  We have to be very careful, we're not allowed to attend any of the rallies that are out in the streets, we're only allowed to broadcast from within our, our own office or here at state television.  But most lines of communication in Iran have been jammed.  The Internet for the most part is jammed, mobile phones get cut off in the evening and text messages haven't worked for a week.  I have to be--I have to say, though, although we're not allowed to go out and, and attend any of the rallies, there haven't been any restrictions on what we can say or write yet.

MR. GREGORY:  I still--I think a lot of Americans wonder, Ali, who are these protesters?  Do they really represent a broad cross-section of Iranians?

MR. AROUZI:  Well, well, David, this started as a--as essentially a middle-class uprising here, but it seems to have encompassed people from all walks of life right now.  There are, there are a lot of different people of different ages and different walks of life that you see out in the street protesting.  So it, it, it has spread to, to many different types of people in Iran.

MR. GREGORY:  All right, Ali, stay right there.  Let me bring in here our chief foreign correspondent, Richard Engel.  We're lucky enough to have him here in Washington.

You were in Iran, you were expelled from Iran.  Very difficult now, if impossible, to get back in.  Is there evidence that the demonstrators are backing off at all?

MR. RICHARD ENGEL:  It's hard to know exactly how many demonstrators were out yesterday, because there was such a large security presence on the streets from all of the different branches of the security services--the Basij militia, the Revolutionary Guards, regular riot police--that the demonstrators weren't able to assemble like they had in, in the past in any one particular location.  Instead there were pockets of thousands that were spread out around the city and there were violent clashes in several of those pockets.  And today the Iranian government's position is that these people are terrorists, and Iranian television has been broadcasting images of the demonstrators attacking police forces, vandalizing property.  It clearly is trying to say that these demonstrators are a national security threat, not a political uprising.

MR. GREGORY:  Let me ask you about both the U.S.  response but also the nature of the opposition.  Mousavi, he's the one who challenged Ahmadinejad, he lost in the election that the protesters are saying was rigged.  Where is he and is he prepared to keep this thing going?

MR. ENGEL:  His aides are spreading a quote that, that he gave yesterday that Mousavi said he's willing to accept martyrdom.  Couldn't be clearer where--the direction that he is taking.  He has been a very stubborn, defiant leader. People had underestimated him in the past.  And he's--he seems very willing to, to take this movement forward.  He was out at a demonstration yesterday. And the, the idea is even though these demonstrations are now considered illegal and a national security threat, if the crowds gather he or other key, key officials have been attending.

MR. GREGORY:  What about the U.S.  response?  So much debate about whether President Obama should do more than he's done.  He stepped up his rhetoric yesterday, saying these are unjust actions, saying the whole world is watching.  What's the critical balance here for this administration?

MR. ENGEL:  I think they have to, to watch and see how this develops a little bit more.  There is still room for Iran to escalate.  Yesterday was a, was a brutal crackdown and perhaps dozens of people were killed, but it wasn't tanks in the streets leveling their cannons and opening fire into crowds.  That could happen.  But I think they have to be very cautious not to wade too, too deeply into this, because right now the, the movement does seem to be gaining steam on its own.

MR. GREGORY:  Ali Arouzi in Tehran, what are you looking for about how all of this ends?

MR. AROUZI:  Well, we're, we're seeing how far the opposition is going to go. So far the opposition leader, Mir-Hossein Mousavi, hasn't shown any signs of backing down.  He's dug in his position.  Today again we, we saw on his Web site that he's called for these election results to be annulled, which is a message to his supporters that he hasn't given up the fight.  What we have to see is what both sides are going to do now.  They've both dug themselves in, their, their rhetoric has heated up a bit.  We're going to have to see who gives up first, really.

MR. GREGORY:  Finally, Richard Engel, is what we're seeing over the past few days the ultimate sign of weakness on the Iranian--part of the Iranian regime?

MR. ENGEL:  I think we're seeing the start of a crackdown.  And for the first time you're seeing images of the supreme leader being burned in the streets. Just a few days ago you, you wouldn't have seen that at all.  The supreme leader, by speaking on Friday, expressed strength to one degree by, by laying down the law, but he also expressed weakness by entering into a political debate that normally the supreme leader, who's supposed to be divinely inspired, is not supposed to get involved in.

MR. GREGORY:  And from Ahmadinejad defiance as well; speaking today, saying they're rethinking relations now with some Western countries.  They want to try to rally support.

MR. ENGEL:  Absolutely.  Ahmadinejad, the speaker of parliament, the foreign minister all lashing out at European nations and the United States, saying that they might consider cutting ties.

MR. GREGORY:  Mm-hmm.

MR. ENGEL:  This is following that message from the supreme leader that it is a rebellion being fueled from the outside, not a domestic problem.

MR. GREGORY:  All right, our chief foreign correspondent, Richard Engel, thank you very much for being here in Washington.

And, Ali Arouzi in Tehran, thank you very much.

We want to go live now to Jerusalem and Israeli Prime Minister Benjamin Netanyahu.

Prime Minister, welcome.

MR. BENJAMIN NETANYAHU:  Thank you.  Good to be with you.

MR. GREGORY:  This is an unfolding story that we've been seeing all week long.  The images from the streets are disturbing, you have a violent crackdown under way in Iran.  What does your intelligence in Israel tell you about the weakness, the nature of the Iranian regime today?

MR. NETANYAHU:  Well, it's not my intelligence, but my common sense and the traditional sense.  Obviously, you see a regime that represses its own people and spreads terror far and wide.  It is a, a regime whose real nature has been unmasked, and it's been unmasked by incredible acts of courage by Iran's citizens.  They, they go into the streets, they face bullets.  And I tell you, as somebody who believes deeply in democracy, that you see the Iranian lack of democracy at work.  And I think this better explains and best explains to the entire world what this regime is truly about.

MR. GREGORY:  I ask about your intelligence services as well in terms of what hard information you have about what's going on inside the regime.

MR. NETANYAHU:  I don't know if anyone really knows, and I cannot tell you how this thing will end up.  I think something very deep, very fundamental is going on, and there's an expression of a deep desire amid the people of Iran for freedom, certainly for greater freedom.  But perhaps the word is a simple one, freedom.  This is what is going on.  You don't need all the intelligence apparatus that modern states have to see something when it faces you right away.  It, it's facing you in--it's staring us in the face, there's no question about that.

MR. GREGORY:  You know there's been quite a debate here in the United States and really around the world about what President Obama should do and should say at a moment like this.  He has said over the weekend that these are unjust actions, that the whole world is watching, that Iran should not violently crack down on its people.  Has he said and done enough, do you think?

MR. NETANYAHU:  I'm not going to second-guess the president of the United States.  I know President Obama wants the people of Iran to be free.  He said as much in his seminal speech in Cairo before the Muslim world.  I've spoken to him a number of times on this subject, there's no question we'd all like to see a different, a different Iran with different policies.  Remember, this is a regime that not only represses its own people--Sakharov said, Andrei Sakharov, the great Russian scientist and humanist, said that a regime that oppresses its own people sooner or later will oppress its neighbors.  And certainly Iran has been doing that.  It's been calling for the, the denial of the Holocaust.  It's threatening to wipe Israel off the map.  It's pursuing nuclear weapons.  To that effect it's sponsoring terror against us, but throughout the world.  So I think what everybody would like to see is a change in policy, and the change of policy is both outside and inside.

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