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Scarborough transcript with Steve Emerson:

SCARBOROUGH COUNTRY special. I‘m Joe Scarborough.

Well, the 9/11 Commission drops a bombshell report that could affect your family‘s safety and Congress goes on vacation for a month. It‘s time for tonight‘s “Real Deal.”

You know, bombshells were set off by the release of the 9/11 Commission report, which graphically detailed why America slept before September 11 and how al Qaeda‘s next terror attack could be even more deadly than September 11. But your politicians in Washington aren‘t going to be working on implementing security measures that were recommended by the bipartisan panel. Why? Because Congress decided to take a one-month break right after the report was released.

In the words of Yogi Berra, it‘s just like deja vu all over again. In August 2001, Congress went on an extended vacation, and on their first day back, over a month later, America was under attack from al Qaeda and Osama bin Laden. And its most important institutions, they were in flames. Sadly, Congress may be doing less harm out of town right now, because after I first got elected to Congress, I soon learned that nothing good got done in months leading up to a presidential election.

You know why? It‘s because petty political bickering reaches almost hysterical proportions during presidential campaigns. So what does that mean? That means that your congressman and senator may be fiddling while Rome burns. How much safer are we today than on 9/11? I‘m asking that question with greater urgency tonight than ever because of a special SCARBOROUGH COUNTRY report this week that focused on the strange occurrences that happened aboard Northwest Flight 327.

That‘s the flight of course where 14 Arab males were met by FBI and immigration officials after passengers complained that those people may have been using the flight to prepare for a future terror attack. You know, the FBI assured NBC‘s Pete Williams that everything checked out fine and these supposed suspects were Syrian musicians in our country legally.

Well, last night, we broke the story that in fact the FBI was dead wrong. It seems the swarm of FBI agents and immigration officials meeting that plane overlooked one simple fact. The Arab men were in the United States illegally without valid visas when they were stopped at LAX, one more reason to doubt any politician or intelligence officer who tells you not to worry about it, everything‘s under control.

Well, friends, tonight, I tell you everything is not under control. Congress and the president had better act fast to shore up America‘s homeland defenses or they may lose their political careers before we the people allow 3,000 more Americans to die for their mistakes. It‘s time for us to take action, and that‘s exactly what we need to do. We need to push politicians in Washington to do the right thing and stop taking month-and-a-half vacations. And that‘s tonight‘s “Real Deal.”

You know, we are going to take the first half-hour with you now to talk to terror expert and MSNBC analyst Steve Emerson. He‘s of course going to break down some of the dozens of shocking revelations in the 9/11 Commission‘s report, including these, that the presidential daily briefing Bill Clinton saw was astonishing compared to what President Bush saw three years later, how al Qaeda completely penetrated all aspects of America‘s aviation system, how they utterly exploited the U.S. immigration system, how al Qaeda set up a virtual document factory to make and manipulate passports, and how Arizona was ground zero for Muslim extremism and al Qaeda training.

Steve Emerson, thanks so much for being with us tonight.

You have been poring over this commission report since it was first printed and hit the bookstores. Tell us, what did you find out?

STEVE EMERSON, NBC TERRORISM ANALYST: Well, Joe, there‘s just an amazing amount of detail.

The report, as you know, is divided in between two sections, the recommendations—actually three sections—the recommendations, the outline of the plot and the history leading up to the attacks, and also the footnotes, which are absolutely mesmerizing in their detail. They‘re an amazing, shocking list of revelations, Joe, that I think are going to be bombshells as they get disclosed and refined over—in the media as well as in Congress, presumably as they hold hearings.

And we can only hope that they do immediately in order to totally discuss the ramifications of what the commission found. I can only tell you, Joe, that I‘ve been looking at the issue of Islamic extremism for 10 years. And I‘ve been absolutely in shock—and I‘m not use any exaggeration—at the degree to which the United States was thoroughly compromised and how it has continued to be thoroughly compromised by Islamic extremist groups going back to the early 1990s.

SCARBOROUGH: Now, Steve Emerson, we‘ve been talking to you some time. You, of course, are our terror expert, one of the most respected in America. You have been sounding warning bells for years about Islamic extremism and about al Qaeda, about Osama bin Laden. Are you telling us here tonight that, after reading the 9/11 report, it‘s much, much worse than even you imagined?

EMERSON: Absolutely. I was absolutely amazed. And I still am, as I still pore through the amazing details of the footnotes.

And the commission staff did a phenomenal job, I must tell you, Joe, in amassing an outline from two million documents. Rarely does any commission ever get this access. And it‘s absolutely mesmerizing to the extent that they were able to find everything from the CIA to FBI to INS officials in terms of what they were discovering, putting it together, showing the magnitude of how the U.S. Treasury was unable to track terrorists—terrorist financing, how the FBI really had—could not put the large picture together, the extent to which Islamic militants working for al Qaeda and other Islamic terrorist groups were residing in the United States, knowing and exploiting the full freedoms that were available to them and snubbing their noses at U.S. officials.

And I‘m still amazed, even as I speak to you right now, Joe, at the degree to which they were able to compromise all aspects of U.S. national security. We can only hope that we‘re doing a better job. I believe we are, but we‘re still not safe yet.

I would like to obviously go over with you some of the revelations that are in this report, which are absolutely compelling.

SCARBOROUGH: Well, Steve, let‘s go over the first revelation that you brought up. That has to do with the presidential daily briefings.

Bill Clinton received a PDB in December of 1998. It was titled—quote—“Bin Laden Preparing to Hijack U.S. Aircraft and Other Attacks.” Now, President Clinton‘s memo, according to the commission, contained much more specific classified information than the PDB that President Bush received in August 2001. That was, of course, entitled—quote—“Bin Laden Determined to Strike in the U.S.”

Now, let‘s look at the specifics of the presidential daily briefing that Bill Clinton saw, according to the commission—quote—“In late 1998, reports came in of a possible al Qaeda plan to hijack a plane. A December 4 presidential daily briefing for President Clinton brought the focus back to more traditional hostage-taking. Had the contents of this PDB been brought to the attention of a wider group, including key members of Congress, it might have brought much more attention to the need for permanent changes in domestic airport and airline security procedures.”

Steve Emerson, let‘s forget for the minute the political questions about double standards. Talk to me about why an important revelation like this was not told to members of Congress, not told to other people in intelligence agencies who could have acted more aggressively to stop these type of hijackings going all the way back to 1998?

EMERSON: Well, Joe, look, the details of this PDB, which really have not been fully revealed by anyone in the media yet, in terms of reporting on it, are staggering, because what the PDB, the presidential daily briefing, of December 4, 1998 -- and I‘ve got a copy of it here from the report—shows example after example of hard-hitting classified intelligence showing that bin Laden was trying to hijack airplanes and his people in the United States in order to free Sheik Omar Abdel Rahman, as well as attack other parts of the United States or even use SA-7 anti-aircraft missiles.

I was amazed actually by the degree to which the U.S. intelligence agencies had intelligence on this type of operational efforts by bin Laden. And the question is, why didn‘t...

SCARBOROUGH: So, Steve, was there a double standard here, Steve?

EMERSON: Well, I can only tell you, if you look at the lack of detail that was given to the President Bush in August of 2001, one asks why was current President Bush denied the same details as President Clinton was, and why is there all this heap of criticism for President Bush for not acting, when there is no actually asking of President Clinton why he didn‘t do anything substantively after getting this briefing, which is absolutely phenomenal, because this preceded by three years what the president, current president, received in 2001.

SCARBOROUGH: You know, it certainly is surprising that Bill Clinton gets this specific information in 1998 and like you said, the intel agencies did not give President Bush the same degree of information about bin Laden wanting to hijack planes in the U.S.

Let‘s talk about another finding. You say that al Qaeda—or the report says that al Qaeda completely infiltrated the U.S. aviation system. And this is what the report says—quote—“One Libyan with suspected terror ties had a master‘s degree in a technical field, yet was working in menial jobs at the airports as a skycap and then a baggage handler. Another was working as a technical avionics officer for a domestic airline and oversaw the complete overhaul of aircraft and was checking for structural integrity.”

Now, Steve, this wasn‘t just a few terrorists learning to fly airplanes. They actually had operatives in the cargo holds, baggage handling, food service? I mean, explain this. They completely infiltrated our system.

EMERSON: Absolutely, Joe. This is really another one of those revelations that are so stinging, because most people had focused on the pilots that trained at flight academies and obviously took their operational traits and perfected them on 9/11.

But, clearly, the report shows in incredible detail that hostile nations from Libya—well, they don‘t identify nations, but certainly Libya was identified, Lebanon, Yemen, even Syrians, as well as other Saudis, and, of course, the terrorists from al Qaeda, who deliberately tried to penetrate all aspects of the U.S. aviation security system, from reservation networks to actually food baggage, as well as passenger reservations.

It was an amazing degree of infiltration. And we don‘t really know to this day, Joe, how far they‘ve been able to sort of bury themselves into the system. But it clearly was a vast type of effort going on since 1995.

SCARBOROUGH: Let‘s move on and talk about the next finding in the 9/11 report that you brought up, the document factory. You say that al Qaeda—or, actually, the report and you say al Qaeda maintained a sophisticated document factory that created credentials, drivers licenses and also manufactured and manipulated passports.

They even infiltrated the Saudi passport agency. Two of the 9/11 hijackers had family members inside the Saudi passport office who provided them with new passports for their trip to the United States. Let‘s talk about that for a second, Steve. How did that help the terrorists on 9/11 take over these airplanes?

EMERSON: First of all, their passports were constantly refabricated, reissued. They had been able to manipulate the visas. As you just pointed out, they had assistance from relatives inside the Saudi passport agencies. They were able to actually create and fabricate other document travel, credentials around the world.

And they—using an office that they had at a Kandahar airport. And its entire mission, Joe, was to fabricate credentials. And I‘m amazed actually the degree to which they were successful in fooling every single country in the world. They were able to fool all the airlines. They were able to fool the best U.S. counterfeit detection methods, clearly resulted in the worst penetration of U.S. security.

And the only question is whether the U.S. government has been able to basically upgrade its technology to detect the fraudulent means. And it‘s an open question.

SCARBOROUGH: All right, Steve, stick around, because we‘re going to have much more with you on the 9/11 report just ahead.

Plus, we‘re going to be talking to Senator Susan Collins and Congressman Chris Shays about what they plan to do now about the recommendations of the 9/11 Commission.

We‘re also going to tell you how you can contact your congressmen and senators and president and make a difference.

We‘ll be right back.

(COMMERCIAL BREAK)

SCARBOROUGH: You can give your congressman and senator vacation reading by writing them about the 9/11 report. To do that, go to Joe.MSNBC.com.

We‘ll be right back.

(COMMERCIAL BREAK)

SCARBOROUGH: Hey, I‘m Joe Scarborough. We‘re back with a SCARBOROUGH COUNTRY special.

We‘re going to bring back in Steve Emerson, MSNBC terrorism expert.

Steve, one of the things that surprises me so much—I know surprises you also—is how al Qaeda and these terrorists had infiltrated some of America‘s most important systems. One of them, of course, had to do with the immigration system. The next revelation, that Mohamed Atta and other top-level al Qaeda members had totally thorough knowledge of the U.S. immigration system and its laws. Explain.

EMERSON: You know what, Joe? If I were looking for an immigration lawyer and Mohamed Atta were alive today, I would use him, because this guy perfectly knew the entire vulnerabilities of the immigration system.

He was able to get visas issued for the other hijackers. He personally actually applied for visas for some of his colleagues. He knew exactly when the expiration was. He knew about the six-month visa for tourists. He knew about the work visas. He knew about the student visas. He knew exactly when to leave the country, when to come back in order to trigger the new time code.

So this was a man who really studied the system, which was totally available. I might add, Joe, that the 9/11 attacks unfortunately at first instilled a sense of weakness that we were vulnerable only on that one day. But this report shows, Joe, that the entire apparatus of U.S. national security and domestic institutions had been compromised to a much greater degree than ever previously thought.

SCARBOROUGH: You know, and what is so frightening is so many of us like to think, oh, gee, well, these were just religious zealots, crazy people that irrationally flew planes into building.

What this report is finding and what you‘re telling us tonight is, they were very calculating, brilliant tacticians in figuring out how to strike at the heart of America‘s financial and military system.

Let‘s move on and talk about the so-called second wave of terror that the report discusses. There were actually al Qaeda recruits and the report says its members were in America on reconnaissance missions as early as 1996. The report says this—quote—“A terror suspect later indicted in Spain was visiting America in 1997 and videotaped a number of U.S. landmarks, including the World Trade Center. Later reports say that Mohamed Atta included a nuclear plant in his preliminary target list.”

Talk about this reconnaissance, these reconnaissance, missions, Steve, that, again, started a full five years before 9/11.

EMERSON: What the report shows in incredible detail is the degree to which al Qaeda and other Islamic extremists reporting either to Khalid Shaikh Mohammed or to bin Laden or to other terrorist groups, including Hezbollah, were in the United States since 1995 at the very minimum, documenting vulnerabilities, videotaping, doing reconnaissance, and reporting back to terrorist groups as to where they might be able to strike, including attacks on the Jewish communities in New York, as well as other vulnerable institutions such as you pointed out, nuclear facilities.

Clearly, the al Qaeda and other terrorist groups have developed this incredible library of intelligence using video and on-site inspections for the last seven years from friendly types of terrorist operatives who have gone back and given them access to everything they need to strike again in the future.

SCARBOROUGH: You know, the report also talks about ground zero, actually not the ground zero in New York, but the ground zero in Arizona, because another startling revelation is how Arizona became the nexus for al Qaeda in the United States. Tell us about how Arizona was ground zero for al Qaeda recruitment and training.

EMERSON: You know, Joe, there is an intriguing and an incredible footnote. It‘s on—it‘s footnote 58.

And permit me, because I think I need glasses. But al Qaeda figures at the university in Tucson included Mohammed—Mubarak al-Douri (ph), reportedly bin Laden‘s principal procurement agent for weapons of mass destruction, Mohamed Bozayed (ph), an al Qaeda arms procurer, Wahid al-Hage (ph), an operative who was linked to the East Africa bombings, Walid Julidon (ph), a Saudi extremist who has also been linked to al Qaeda.

And I can tell you there are many others who were living in Tucson or Phoenix since the mid 1980s that were the key command-and-control for bin Laden in the United States. And it‘s one of those enigmas as to why that state became ground central. But clearly it had the highest concentration of top al Qaeda terrorists until 9/11.

SCARBOROUGH: But no answers as to why Arizona itself or the Phoenix area attracted so many al Qaeda terrorists?

EMERSON: Well, it‘s not just al Qaeda. There was also Hamas actually set up its command in Tucson in the mid-1980s. And I can tell you from my other investigations that there were at least five other Islamic terrorist groups who set up command-and-control from Tempe, Arizona, down to Tucson.

And I can only speculate that it has to do with the fact that terrorists enrolled at the universities extended their ability to stay in the United States and then brought over families. And this developed a whole pattern of others who basically migrated there because that‘s where they found it most safe to operate.

SCARBOROUGH: Now, let‘s talk about another revelation in the 9/11 reports. There are several examples of General Anthony Zinni‘s opposing efforts to assassinate bin Laden because he was worried about collateral damage.

According to the report, it says, General Zinni predicted collateral damage would number well over 200 and he was concerned about damage to a nearby mosque. A senior intelligence officer made a different calculation, estimating half as much collateral damage and not predicting damage to the mosque.

Now, let‘s talk about the incredible political correctness here, not only with General Zinni, but also we‘ve heard about it inside the Clinton administration, where there were people sitting around the Cabinet table saying, we really don‘t want to attack Osama bin Laden or take him out even if we have the chance, because it might cause some of our Arab so-called allies to be angry. Talk about how the report goes into that.

EMERSON: Well, it‘s interesting. The amount of detail that is given to a period in 1998, in terms of what was going on in the U.S. military and the National Security Council, focuses clearly on the debate surrounding the efforts to take out bin Laden, assassinate him.

And the interesting revelations focus on the fact that General Zinni, not just on one occasion, but on several occasions, opposed the use of force, and not just because of collateral damage. There is also an indication here that Zinni himself, according to Richard Clarke‘s memorandum, opposed the use of AC-130s to take out bin Laden.

So there is a real question as to why General Zinni consistently, according to the report, opposed the use of force to take out bin Laden when he was clearly in the crosshairs. And there‘s a lot of hand-wringing during these discussions, and obviously, to this—we want to know why and we need to ask General Zinni, as well as President Clinton why there was this ambiguous type of authority, and then revoked to a certain extent, on killing bin Laden in 1998 and 1999.

The report itself says that President Clinton himself actually changed the presidential authority for killing bin Laden, making it much more ambiguous at one point and therefore reining in those people on the ground who thought they had a green light to take him out.

SCARBOROUGH: And that obviously was a big revelation in the 9/11 report, that actually President Clinton was given language that would allow bin Laden to be killed. He scratched that language out, made it more ambiguous,so bin Laden couldn‘t be killed. When Bill Clinton was asked why he did that, he said he had no recollection of the event, which of course seems preposterous to me.

Now, there‘s also information in the commission‘s report that the Saudis were negligent at the very least and withheld vital information, not the least of which was that the U.S. could not get direct access to an important al Qaeda financial official when meeting with Crown Prince Abdullah. And, of course, Vice President Al Gore asked for that information. He renewed the request. But the U.S. never obtained that access.

That reminds me when we of the Armed Services back I believe it was in 1996 were trying to get information about the bombings at Khobar Tower. The Saudis blocked us. It looks like they did it again leading up to 9/11, doesn‘t it?

EMERSON: Well, Madani al-Tayyib, Joe, was the highest-ranking al Qaeda official caught, actually detained by the Saudis as he was transiting through Saudi Arabia. He was basically in charge of the entire financial network of al Qaeda.

When the U.S. found out that he had been detained by the Saudis, the U.S. asked for access to interrogate him or to see the intelligence that the Saudis had gleaned from him. Both of those requests were consistently denied by the Saudis. And I can only tell you that at that point in time, that would have given the U.S. a snapshot, which they had not been able to access, into the al Qaeda network around the world.

It was a real slap at the face of the U.S.

SCARBOROUGH: It really was.

Steve, we only have 30 seconds left. But tell me, what do you think about revelations in this story we broke on Flight 327, that the FBI had all of these Syrian suspects that were talking to, let them go without even noticing that their visas had expired?

EMERSON: I must tell you, Joe, that it was inexplicable today when I was able to confirm your reporting and that by the reporter, Scott Weinberger, in New York that in fact the 14 visas were expired and nobody in the JTTF, the Joint Terrorism Task Force, noticed it and allowed them to return to Syria without doing the secondary investigation that would have normally occurred had they discovered that they were here illegally.

This is a definite siren for action in terms of improving our system of detection of people here legally and illegally.

SCARBOROUGH: All right, Steve Emerson, thanks so much for being with us tonight.

I‘m telling you, you have provided Americans a great service. We‘re going to stay with you next and in the coming weeks, too, and get you on. We‘re going to keep after this to make sure that congressman follow the advice of the 9/11 Commission, important stuff.