BLITZER: Brent Sadler in Beirut for us. Brent, thank you very much. In his State of the Union address, President Bush mentioned steps toward reform being taken right now in Saudi Arabia, but how far has Saudi Arabia really gone in pursuit of democratic reform. And how are the Saudis reacting to another key part of the president's State of the Union address, his determination to try to drastically cut back on imports of Middle Eastern oil.
Joining us now to discuss this and lots more is Prince Turki al- Faisal, the new Saudi ambassador to the United States. Most recently served as the Saudi ambassador in London. Before that, he was in charge of the Saudi intelligence services. Mr. Ambassador, Prince Turki, welcome to Washington. Thanks very much for joining us.
PRINCE TURKI AL-FAISAL, SAUDI ARABIA'S AMBASSADOR TO U.S.: Thank you, Wolf. It's a pleasure to be here.
BLITZER: I want to get to all of these issues. Let's go through a couple issues of the day right now. Your immediate reaction to this, quote, "escape" of these al Qaida operatives in Yemen, those including the mastermind of the killing of some 17 U.S. sailors aboard the U.S.S. Cole and 2,000 in the Yemen port of Aden. Tell us your immediate reaction to this. Do these things happen in Yemen, or is there somebody sort of opening the door and letting these prisoners go?
PRINCE TURKI: Well, we must not make it simply a question of Yemen. First of all, let me say that I think that Yemeni forces will immediately go out and probably capture all these people again. If you remember, in Afghanistan, under U.S. direction, prison was escaped from by al Qaida leaders as well in Bagram, I think last year.
So, prisoners in prison will try to escape anywhere they are. I don't think it's peculiar to Yemen particularly, and as I told you, I think they will be recaptured because they have nowhere to go.
BLITZER: All right. Let's talk -- also another huge story, a tragedy over the past few days.
PRINCE TURKI: Very much so.
BLITZER: This ship, this Egyptian ship that was bringing Egyptian workers, mostly, from Saudi Arabia, your country, back to Egypt. Fourteen hundred people on board. Maybe a thousand may have died in this, so I know you're following this. What is the latest information that you're getting?
PRINCE TURKI: I wish I could tell you more than what you can read in the papers and hear on the radio. The investigation is ongoing. The rescue attempts are continuing. Some people have been rescued from the sea on both shores, Egyptian and Saudi, but the death toll is very high, and it is a very much a tragedy as you say.
And it reminds me of a tragedy that happened several years ago as well on a similar ship that was crossing the Red Sea between the kingdom and Egypt. And hopefully, the authorities will get to the root of this and prevent it in the future.
BLITZER: Was there any concern, any advance word when that ship left Saudi Arabia for Egypt that perhaps there was a problem?
PRINCE TURKI: None whatsoever. Not as far as I know.
BLITZER: And your suspicion this was a mechanical problem, or it was bad weather, but there was no terrorism.
PRINCE TURKI: I cannot foreclose any conclusions. I'd rather wait for the results of the investigation, but it happened that during that specific day when the accident took place that there was bad weather in the Red Sea, yes.
BLITZER: All right. We'll continue to monitor that story. Let's get to this issue of this cartoon of the prophet Mohammed that has sparked such anger and outrage in the Muslim and Arab world. First of all, in Saudi Arabia, I'm sure there's a lot of anger. Are we seeing in Saudi Arabia the kind of demonstrations and anger that we've seen in Damascus, in Beirut, in Gaza, elsewhere in the region including in Iraq right now?
PRINCE TURKI: Let me just begin by saying that the cartoons are offensive. I don't know if you've seen them, Wolf, but they are absolutely horrible depictions of the prophet Mohammed, a man esteemed not just by Muslims but even by non-Muslims, and these things I think should be handled with care and with sensitivity.
From the beginning, I think there were on both sides, there were perhaps people enter into these issues without necessarily gauging or judging the effects of them. And on both sides, I think there must, there should be quiet and a return to talk rather than, as you said in your report, burning down or looting or stoning of buildings and so on.
BLITZER: Are things quiet in Saudi Arabia?
PRINCE TURKI: The kingdom is not a country that is prone to violent public demonstrations. The people express their views more calmly and more discreetly, and they do call up people like officials and express their views about them. There was a group of people who went to the Danish embassy in Riyadh to protest the cartoons and the Danish embassy received them, I believe, if I'm not mistaken.
BLITZER: Is it safe for Danes and other Europeans, Westerners to be in Riyadh and Jeddah and other cities in Saudi Arabia right now?
PRINCE TURKI: Absolutely, there is no danger of anybody being stoned or hauled off or lynched if that is what the fear is.
And as I told you, I mean the people in Saudi Arabia are not that way inclined, but the whole issue should be dealt with more discreetly and more quietly, I think.
BLITZER: Here's what a lot of Americans and westerners in general don't understand. They certainly understand that there could be anger as a result of this cartoon of the prophet Mohammed, but they don't understand why there isn't greater anger, for example, at the video that was seen on Al Jazeera of the American journalist, this young woman, Jill Carroll, who was seen weeping surrounded by masked gunmen.
Why doesn't a picture like that generate the kind of anger in the Arab and Muslim world that you might think should be -- it should generate because it's such an awful, awful situation?
PRINCE TURKI: Well, I wish I could tell you. It would take some study to do that, but, again, that picture, as you say, did not generate anger in non-Muslims as well. We didn't see demonstrations taking place in the streets of Washington or Los Angeles or wherever this young lady came from, nor in other non-Muslim places and countries. It is something I simply cannot answer, Wolf.
BLITZER: Here's the other thing that a lot of Americans and Westerners in general also see a double standard. They see some the cartoons that have been published in Saudi newspapers, and we'll show of them right now. Very offensive to Westerners and to -- specifically to Jews, and I'm going to show some of them. I want you to take a look at them as well.
For example, this one shows a fat -- it looks like an Israeli with a Star of David. That's supposed to be blood and little children and that Israeli is supposedly drinking that blood. That's a pretty offensive cartoon.
Let me put up...
PRINCE TURKI: Can I ask where that was shown?
BLITZER: That was shown in a newspaper called Al-Youm on December 4th, 2005. Are you familiar with that newspaper?
PRINCE TURKI: Yes, I'm familiar with the newspaper, not familiar with the cartoon.
BLITZER: All right, let me show you another one. This one is a Nazi swastika over the Star of David. Given the history of the Holocaust, clearly very offensive.
Let me put another one up there. This shows Orthodox, Hasidic Jew, basically manipulating terrorists, tying the kafiyah together, and it shows that hook nose, a very, a very ugly portrayal of a Jew.
And I'll show you one final one, and then we can talk about this. You see this sign, "born to kill," over the Star of David.
These are all in Saudi publications, Al-Watan, Al-Youm, and they go on and on and on, and it's a source of great concern. You understand that.
PRINCE TURKI: Well, of course, and I think they are offensive. And if I were in charge of the newspapers, I would not let that happen.
You have to take into account, though, that the issue of Palestine and the unresolved issue of Palestine is a generator of most of this feeling that we have in the Arab world, particularly towards Israel. And this is something that you, Wolf, have dealt with before and quite evenhandedly and quite open-mindedly. And the need for resolution of that problem, I think, will go a long way to meeting the requirements of things like that not happening.
BLITZER: Last week on this program we had one of the co-founders of Hamas, Mahmoud al-Zahar, who was on "Late Edition," and he referred to the two stripes on the Israeli flags, the blue stripes on top and the bottom of the Star of David, saying these represent the Nile River to the Euphrates River, and this is what Israel really seeks: an Israel from the Nile to the Euphrates. And that's why he rejects this, quote, "two-state solution," Israel living alongside a new state of Palestine, because he says the Israelis don't accept a two-state solution.
PRINCE TURKI: I can't answer for what Mr. Zahar said or any of these people who think like that. But I do know that there is on the table in the Middle East a road map. There is Abdullah peace plan. There are commitments by the Palestinian Authority to both these peace issues, and any government that succeeds in the Palestinian Authority must deal with those realities.
BLITZER: Saudi Arabia accepts a two-state solution.
PRINCE TURKI: We practically invented it with our peace plan that King Abdullah presented in 2002 to the Arab League, and he got the commitment of all Arab countries to Israel and Palestine living side by side with Israel withdrawing from Palestinian territories, including Jerusalem, in return for full recognition and normalization of relations between the Arabs -- all the Arabs states and Israel, including the Palestinian Authority.
BLITZER: Is it your sense that all that is done with now, that Hamas apparently is going to lead the Palestinian Authority, be the dominant political player among the Palestinians? Is there -- in other words, is this the end of the road?
PRINCE TURKI: I don't think so. I've always been an optimist and despite the realities on the ground, I think the people of Palestine -- if you will look at all of the surveys that have been made in the last few years, have always expressed their view that there should be a two-state solution.
And I think Hamas, when and if they take the helm in the next government in Palestine, will have to deal with that issue. It is not something that they can run away from.
Nor I think -- nor do I think that the Palestinian people will let them run away from things like that, things like electricity, water, transport, movement of people from one place to another, all have to do with dealing with Israeli occupation authorities. So that occupation must be dealt with as a reality and once the occupation is lifted, then the Palestinian people can form their state and the Israelis can continue from there.
BLITZER: Is it your government's position that you will continue to help fund the Palestinian Authority even if Hamas controls it? Because as you know, the U.S. government, the European Union say they're not going to give money to Hamas or the Palestinian Authority if the -- unless Hamas really changes its attitude, renounces terrorism and accepts Israel's right to exist.
PRINCE TURKI: Well, let's not put the horse before the cart. Situation now is that the U.S. and the European union and the rest of the world are still supporting the Palestinian Authority. There is a transitory government now in place that runs things until the next government takes over, and we still don't know what the composition of the next government is. We will deal with the situation as it arises.
BLITZER: How much money does the Saudi government provide the Palestinians on an annual basis?
PRINCE TURKI: We provide through the Arab League, I think something like $200 million, and through international organizations perhaps slightly more than that, through the United Nations and other relief organizations.
BLITZER: All right. So let me read to you from The Los Angeles Times from January 15th, "Millions of dollars continue to flow from wealthy Saudis through Saudi-based Islamic charitable and relief organizations to Al Qaida and other suspected terrorist groups abroad, aided by what the U.S. officials call Riyadh's failure to set up a government commission to police such groups as promised."
This is a sensitive subject that you're very much involved with. And a top U.S. treasury official undersecretary for terrorism financial crimes said this last year, "The challenges posed by terrorist financing from within Saudi Arabia are among the most serious we have faced. Even today we believe that private Saudi donors may be a significant source of terrorist funding, including for the insurgency in Iraq."
What's going on, because Saudi Arabia promised it was going to cut that off?
PRINCE TURKI: And Saudi Arabia has implemented the cutoff. No single penny leaves Saudi Arabia today through any group or organization for any charitable or other activity at all. All the bank accounts of all charities in Saudi Arabia have been stopped from exporting any money anywhere. Regardless of the nonformation of this commission that is still in work in progress. We have invited people from your treasury department to come, although we have a standing committee there, as you know, with your treasury people looking over these issues. And just a couple of weeks ago Stuart Levey from your treasury department...
BLITZER: He's the man we quoted.
PRINCE TURKI: His quote was last here...
PRINCE TURKI: But he -- just two weeks ago he visited the kingdom, and he looked at all of these measures that we have taken, and when I saw him in Riyadh, he told me that he was happy with the visit, that he would still have to review what he looked at. And we are going to get together to see what conclusions he has reached.
BLITZER: How did you...
PRINCE TURKI: We are -- Wolf, we are committed to the fight against terrorism in its global scale. We are a victim of Al Qaida. We are not the sponsor or the creator of Al Qaida.
So, some of the rhetoric that is used, as in that L.A. article, I think, is offensive to us. Here is a victim who is accused of putting the knife to his throat. I think that is unfair and that if they looked at the facts that perhaps they would change their mind.
BLITZER: Here's what the president said the other day. And I'm not going to play the sound bite. You've heard it many times, but basically, the president, in his State of the Union address said the United States is addicted to oil and this must stop.
A lot of that oil comes from your kingdom.
PRINCE TURKI: Not true. Most of the oil you receive comes from other places.
BLITZER: But a lot comes from Saudi Arabia.
PRINCE TURKI: We export to the United States only 15 percent of the United States' imports. I would hardly call that a lot.
BLITZER: So, how did you react when you heard the president say the United States must end its addiction to oil?
PRINCE TURKI: Well, he went further than that, actually, and said "Middle East oil." I was taken aback and I raised this point with government officials.
BLITZER; You were sitting in the chamber when he said that.
PRINCE TURKI: I was, indeed, and the next day had a very good meeting at the White House with National Security Council Director Stephen Hadley. And we are talking through that issue, both governments.
BLITZER: Well, what does that mean -- we're talking through that issue? Because, as you know, you're developing your oil fields assuming there's going to be an appetite for that oil?
PRINCE TURKI: And stemming from a joint communique that came out of King Abdullah's visit to Texas last year in which both he and the president agreed on a joint energy policy that includes the increase in Saudi oil output and working together to increase refining capacity to provide oil products and so on.
It is something that is of serious concern to us because oil is our major income earner.
BLITZER: So, what happens now? You and Stephen Hadley, the president's national security adviser met. Where do you go from here?
PRINCE TURKI: We're talking about these issues and that's where we're going.
BLITZER: We have to leave it right there, unfortunately. Mr. Ambassador, this was a good discussion. Welcome to Washington. Once again, you have a huge job ahead of you and we hope you'll be a frequent guest on our program.
PRINCE TURKI: Thank you. Well, you told me I was going to talk about reform which you didn't leave me time to do that -- next time.
BLITZER: Next time, then. We always want to leave our viewers with more -- they'll want more. We'll definitely have you back.
PRINCE TURKI: Thanks very much, Wolf.
BLITZER: Kind of you to come into our studio.
PRINCE TURKI: Not at all.