Tim Russert:  Prince Bandar, welcome to "Meet the Press."

Prince Bandar: Thank you.

Tim Russert: As I showed Bob Woodward's book ["Plan of Attack"], January 11, 2003, you were briefed by Vice-President Cheney and Secretary of Defense Rumsfeld about the war in Iraq. That's two months before the American people were told. Do you think that's strange?

Prince Bandar: Not at all, because at that time, the options were either the United Nations' solution would work and Saddam would respond to it or that it would mean serious consequences, which ultimately lead to war. And, you don't make plans the night before you go to war. It takes time to plan. And, my country is next door, there is 500 miles of border with Iraq; and we were interested to know what's going on.

Tim Russert: Is Bob Woodward correct that you advised the President to take $200 million and in effect buy off the Iraqi army, pay them for their service, buy their loyalty, and that they could be a security force right now in Iraq?

Prince Bandar: I don't talk about my conversations with the President. But, I believe that would have been the right way to go. There's no point in Monday morning quarter-backing now. What we need now to do is make things work.

Tim Russert: In terms of oil supplies, this is the exact captions from Bob Woodward's book,  [on screen display]

Senator Charles Schumer of New York has called on the President to revoke your diplomatic visa for interfering in the presidential election 2004 by promising the President that you might lower prices before the November election to help his cause.

Prince Bandar: So, what's the question Tim?

Tim Russert: Did you in fact make such a promise to the President?

Prince Bandar: The president talked with me for months about the high oil prices and how that could be damaging to the American economy and the world economy as it is recovering. And, I informed him of my government's policy, which is to maintain oil prices between $22 and $28. And, we prefer $25 as a median. And, that is the extent of that. That was no deal on the election or connection to the election. And, this is not the first time. In 2000, President Clinton asked us to do the same thing because prices were getting to high above $30.

Tim Russert: But, in October 2000, crude oil was $35 per barrel. So you didn't keep your end of the deal.

Prince Bandar: Well, there's a reason. Because it's not a matter of crude. The reason you have high prices in the United States is that the refineries are not enough to refine. There is one million barrel shortage of refined products. So, even if tomorrow, we send you all the oil we have as crude, it would not change the facts here. The United States has not built a refinery in about 15 years. Like our oil minister said the other day in Dallas, we're willing to invest in refineries in the United States of America. And, that would really be the best route to go.

Tim Russert: What do you think the price of Saudi oil will be in October 2004?

Prince Bandar: I wish I knew, but I can assure you now we've been working very diligently to make sure that the prices go down below $28. This is a public position we have taken, and we've convinced OPEC to agree with us on that. And, I don't understand what is so wrong with oil prices going lower. I thought that is good for America, the American economy, the American people. And, it is definitely good for us in my country.

Tim Russert: And may be good for George Bush's reelection?

Prince Bandar: It may be good for anybody in the Whitehouse and the American people. And, we don't see the difference.

Tim Russert: Let me turn to Saudi Arabia. Here's a photograph of 15 of the 19 hijackers on September 11 [TV display of Saudi hijacker photos] -- all members of your country. More than a year - November 2002, after the September 11th hijackings, here's what your interior minister said, "We put big question marks and ask who committed the events of September 11 and who benefited from them. Who benefited from events of 9/11? I think they [the Zionists] are behind these events." [Prince Naif, Interior Minister, Kingdom of Saudi Arabia, Al Siyava-Kuwaiti Newspaper, Reprinted in Saudi weekly newspaper November 29, 2002]

Is that the position of your government?

Prince Bandar: No. I don't know in what circumstances this quote was made, but I can tell you the position of my government and that includes Prince Naif. 9/11 was an earthquake. It shook us to the roots. It's an evil work done by evil people who were targeting your country but also targeting the relationship between our two countries. Otherwise, is it accidental that they would choose 15 misguided young people to be out of 19 when they had a pool of so many people from so many different countries? So, it was intentional to do it that way, to hurt our relationship.

Tim Russert: So, the Zionists were not behind it.

Prince Bandar: The Zionists were not behind it, but there is a reason why people were skeptical. If you watch the 9/11 Commission, people could just not believe that those young people who were trained in caves in Afghanistan could do something so spectacular and evil and sophisticated. The truth of the matter, we all were. Is it true that those were the people who planned it and executed it? Well, we discovered later that it is true.

Tim Russert: Let me ask you about September 13, this is the way Craig Unger wrote about it in The Boston Globe and now his book, [on screen display]

Did you talk to President Bush about allowing those Saudi citizens to go home?

Prince Bandar: No.

Tim Russert: You never brought it up?

Prince Bandar:  Period. But, if you allow me Tim, my only comment about this book and the quote you just read to me - in French, it's hogwash, number one. Number two - the 9/11 Commission just declared -- let me read to you what they declared. The 9/11 Commission released a statement that says the FBI concluded that nobody, nobody was allowed to depart on these six flights who the FBI wanted to interview in connection with 9/11 attacks or who the FBI later concluded had any involvement in the attack. The statement also says that the Saudi flights were screened by law enforcement officials primarily, but also FBI, to ensure that people on these flights did not pose a threat to the national security. And, nobody of interest to the FBI with regard to 9/11 investigation was allowed to leave the country.

The tragedy here, Tim, is that there are people who don't know how to take "yes" for an answer. The 9/11 Commission says this, the FBI says this, and you still get people coming up with books that say that they smuggled them.

Tim Russert: But Prince, here's the question. This is a photograph of you with the President down at his Crawford Ranch. He brought his family. [Photo of Bush and Bandar at ranch shown; August 27, 2002] Elsa Walsh of the New Yorker wrote that you are almost a member of the Bush family. That was her interpretation of it after doing an enormous amount of research. And, 140 did leave the United States when Americans couldn't fly. The FBI spokesman, Johnny Norelli said I can say unequivocally that the FBI had no role in facilitating these flights. Jim Thompson on the 9/11 Commission asked Richard Armitage, Deputy Secretary of State, did you, the State Department authorize this? "No sir." I asked the Vice-President of the United States on this program, did he know anything about it? "No sir." 140 Saudis leave the country, two days after September 11, and nobody knows who gave permission. You don't know anything about it? You didn't ask anyone for permission? You didn't facilitate it in any way? The planes were just allowed..

Prince Bandar: Tim, no, no, no. This is becoming exotic now. We had those people in the country, and a lot of them were relatives of the bin Laden family going to school, from teenagers to some people in college. And we asked the FBI, that those people are scattered all over America and with tempers high at that time, and rightly so, and we were worried that someone getting emotional would hurt them.

Tim Russert: So, who did you call for permission?

Prince Bandar: We didn't call them, we asked them, is it possible..

Tim Russert: Who?

Prince Bandar: The FBI..

Tim Russert: You called the FBI, and they gave permission?

Prince Bandar: The FBI and I called them to Richard Clarke, in his testimony, called him and he said I have no problem if the FBI has no problem. So, we gathered them all in here and then once they were here, they left. Now, the other airplanes were for Saudi officials who were here on vacation. And, after this disaster took place, they all had to go back home to official positions. But, it is not true that they were flying when Americans were not flying, Tim. Americans were flying, and restrictions were lifted. I mean, the stoppage was lifted, but there were restrictions. So, think about it logically. Do you think.. where are we, in a "banana republic" where I would take 148 Saudis and put them in an aircraft and smuggle them out, and nobody would know? Look, people have to take "yes" for an answer and read what the 9/11 Commission said on this.

Tim Russert: Let me turn to the whole issue of terrorism and the funding of it. This is Newsweek Magazine, headline "New Questions about Saudi Money - And Bandar."  [on screen display]

Prince Bandar: Tim, if that was true, I think it would make a great movie, but it's not true. We terminated.. Riggs Bank problem is a regulation problem that has nothing to do with Saudi Arabia. However, Riggs Bank and us came to mutual agreement to terminate our relationship.

As far as the embassy's accounts, or my wife's account, or my account, there is not one question that we had from the U.S. government about what happened to these accounts. Here's the problem - when a story like this, that has a prince, princess, money, terrorism - it is exotic. The tragedy I find.. I like this country, and I like the American people, they are fair people. But, one thing that is done in this country that really disappoints me, and I could say something stronger, is that when someone puts a story like that, like what Newsweek did, it's a big story. The two people that started all this, Mr. Basnan and Bayoumi.. A month ago, the FBI came and after two years of investigation, there is no connection or foul play. Guess what? How many times did you make a special program about or Newsweek have an announcement? They didn't.

Tim Russert: Prince, the former general counsel to the Department of Treasury, David Aufhauser, a professional, a lawyer, testifying under oath before the Senate Judiciary Committee, [on screen display]

This was the scene in April 2002, when your king, a state sponsored telethon, and look at these pictures, [TV footage of telethon shown - April 11, 2002] raised over $92 million, and the money was for quote "Palestinian martyrs," suicide bombers who blew up Israeli children, school buses, restaurants. Here's the Treasury Department of the United States saying that Saudi money is funding al Qaeda. You're having telethons raising money for Palestinian suicide bombers, and you sit here and say, how could people say these terrible things about us?

Prince Bandar: Yes, I say that very easily because nothing stands still. If you are saying that before 9/11, we didn't have our thing together - yes. But, nor did you. Look what 9/11 is showing. However, since..

Tim Russert: But this was April 2002..

Prince Bandar: I know, but since then, since 9/11, after we recovered from the shock, we looked at all our procedures. We have come through, and we are proud of it.

You read to me a quote, let me read to you the same man in a hearing afterwards, saying the exactly the opposite to this. Secretary Snow publicly in Saudi Arabia and in a briefing here, says the opposite to that.. the Financial Action Task Force of the Organization of the Economic Cooperation and Development (OECD) just came out with a report in March. It says, in the area of charitable giving, new regulations to crackdown on abuses at Saudi Arabian-based charities probably go further than any country in the world. This is done by the G7.

Tim Russert: Here is the perception amongst many Americans. That the Saudis, and many members in Congress, you've talked with them as well as I have, the Saudis play a double game. They open up the spigot and say it's all right to vent your hostilities towards the United States, just leave us in the monarchy alone. But now, the genie's out of the bottle. But, the problem is how did people develop such hostile attitudes towards the United States? A commission was create by Congress, and here is the report from May 2003, the U.S. Commission on International Religious Freedom. [on screen display]

If you teach your kids that in Saudi Arabia and in the madrassahs around the world, of course they're going to hate the United States and Israel. In January 2004, 16 employees of your embassy had their diplomatic visas revoked, why?  Because they were teaching at the Institute for Islamic and Arabic Services over in Virginia. And, our government said we had to protect our homeland and remove them from our country. That's the reality.

Prince Bandar: That's not true Tim. If it was the reality, then I don't blame the American people to hate us, but that is not the reality. Those people you were talking about, the 14 people, were teachers in this institute. They were on the diplomatic list of the embassy for 15 years. The law has changed the State Department said to change their visas. So, we had to send them home so they can change their visa, so they can come on a different visa. That's all that happened there.

Tim Russert: Here's your own newspaper, the Arab News editorial. This is terribly important..

Prince Bandar: I agree with you. Let me comment on.. You read me a long.. charges or comments from Congress and the reports. If that was true, then of course our people should hate America, but go to the Zogby poll that he did. And, if you look at that polling, you will find how different the reality is there from what the congressional report says.

As far as our education is concerned, we went and looked.. Look Tim, after 9/11, we were shaken to our roots. It was an earthquake for us. It took us a long time to come out of that shock and say to ourselves, "What happened? What happened?" So, when we looked at our educational system.. here are the statistics. We found 85% of the material was acceptable. We found 10% was questionable, meaning it could go either way depending on the teacher. We found 5% was objectionable. What did we do? We cleared the 5%, and we made sure that the 10% that is questionable becomes much less prone to be misused, and action was taken. It is difficult for people to keep repeating things that happened and, corrective action was taken.

Tim Russert: The Arab News paper in your country, editorial, "But so to has the chattering, malicious, vindictive, hate propaganda, that has provided a fertile ground for ignorance and hatred to grow." Here's the Washington Post, not before September 11.."

Prince Bandar: What was the point of that Arabic paper though?

Tim Russert: This is from this past Wednesday, headline, "U.S.-Saudi Relations Show Signs of Stress - Reformers Labeled 'Agents of America.' This is last Wednesday. [Excerpt of article shown on screen]  Reformers in your government, according to Prince Naif, were agents of America. And, they were arrested. Three are still in prison.

Prince Bandar: Right.

Tim Russert: What does that tell us about your country?

Prince Bandar: Well, if you let me answer, I will tell you. Number one - when you talk about the one before that Arabic paper, you were saying they were saying bad things about American Christians and so on. Look, have you heard what some of the Evangelical priests say here about Islam and our prophet. We all have our cuckoos, and they all sometimes say the wrong thing.

Tim Russert: But, this is the Minister of the Interior?

Prince Bandar: No, no, I'm talking about the one from before when you said people were saying these bad things about Christians, pigs, etc. There's a rabbi in Israel who said those Arabs are snakes, and they should be gotten rid of. I cannot speak for everyone in my country, and you cannot speak for everyone in your country. If you want to take what the papers says then by-golly, I wish you get half of what we get in your news media as in our media. Now, as far as the Minister of Interior, Prince Naif, with the statements you made, I don't know what context it is. If I knew, I could answer you.

But, John Zogby made the polling that showed that 91% of Saudis said they liked America. And 95% said they are against bin Laden, and they don't think what he did is right.

Tim Russert: Ok, we're out of time. One simple question. Who's more popular in your country, Osama bin Laden or George W. Bush?

Prince Bandar: We never put that polling there.

Tim Russert: President Mubarak of Egypt said that the hatred of America is unprecedented in the Arab world.

Prince Bandar: I make it a habit not to comment on heads of states' comments. But, I'm telling you about Saudi Arabia.

Saudi Arabia, the majority of the people, over 90%, don't hate Americans. Now, if you insist that they hate America, that I cannot help you with.

Finally, I would like to make a comment about Senator Schumer. Senator Schumer is really a much nicer person when I meet with him in private than he is on TV. And secondly, make your words soft and sweet, you never know when you have to eat them.

Saudi Arabia is a friend of yours for 60 years, and it will continue to be. We are the targets for the same enemy. The bombing in Riyadh three days ago was not done by Irish people. It was the same people who blew up 9/11. 

So, you cannot tell us we are dealing with the devil. We declared war on those bad people, and we're going to get them.

Tim Russert: Thanks for sharing your views. I hope you come back again.

Prince Bandar: Thanks, Tim.