CANDY CROWLEY: Joining me now, Leon Panetta, secretary of defense, and General Martin Dempsey, who, of course, is chairman of the Joint Chiefs of Staff.

Gentlemen, thank you both for being here.

We had some very interesting hearings on Thursday for your replacement.

I want to play you just a little bit from those hearings.

(BEGIN VIDEO CLIP)

CHUCK HAGEL, SECRETARY OF DEFENSE NOMINEE: As to the Iranian red line, the Persian Gulf, some of the Iranian questions you asked, I support the president's strong position on containment.

By the way, I have just been handed a note that I misspoke. We don't have a position on containment.

Just to make sure your correction is clear, we do have a position on containment, which is that we do not favor containment. We -- we do not favor containment.

(END VIDEO CLIP)

CROWLEY: I'm sure you've seen the criticism of the nominee for your new job and your old job and your new boss.

How did you think Mr. Hagel did?

SECRETARY OF DEFENSE LEON E. PANETTA: Well, you know, these -- these hearings are tough, and especially when a -- when everybody is targeting you. I guess I was really disappointed that a lot of that hearing focused on the past, as opposed to the challenges that a secretary of Defense has to confront.

CROWLEY: Now, you know Capitol Hill, though. SEC. PANETTA: Yes, I know and...

CROWLEY: You know, you've got a record. I mean what else do you move on?

SEC. PANETTA: No, I understand, but you also ought to talk about what a secretary of Defense is going to have to face. The war on Afghanistan. We've got sequester problems and budget problems. We've got serious problems in dealing with the challenges we're -- in -- in terms of the Middle East, on cyber.

I mean there are a number of -- a number of areas that simply were not that well covered that deal with what a secretary of Defense has to do. And that concerned me.

CROWLEY: But nothing concerned -- did -- did anything that -- this will be -- this man will be your new boss, replacing Secretary Panetta?

Was there anything in that hearing that concerned you?

There are a lot of folks who thought he just doesn't seem prepared.

GENERAL MARTIN DEMPSEY, CHAIRMAN, JOINT CHIEFS OF STAFF: No, I had the same reaction that -- that Secretary Panetta had, which was I was actually more surprised about what wasn't discussed than what was. And in my contacts with -- with the senator, Senator Hagel, and his preparations, I found him to be very thoughtful and very well prepared and very interested.

And so if he's confirmed, I -- I'm sure that we'll establish a very close working relationship.

CROWLEY: So you all thought he seemed well prepared?

SEC. PANETTA: I -- I think -- I know Chuck Hagel. And I think that he's got good experience with regards to public service. He understands the issues at the Defense Department and I think he'll be a -- a great secretary of Defense.

CROWLEY: I want to ask you about signals in Washington. General Michael Hayden, who I think probably both of you know, is a former director of the CIA, was talking about incoming Secretary of State John Kerry, incoming, if he is confirmed secretary of Defense, Chuck Hagel.

And here's what he had to say about the new team.

(BEGIN VIDEO CLIP)

GENERAL MICHAEL HAYDEN: I think the new team thinks more like the president thinks when it comes to foreign policy. This is going to be a team that might not pushback as much with regard to cuts or withdrawals or smaller footprints or reluctance to deal with big footprints into new areas.

(END VIDEO CLIP)

CROWLEY: So, I -- I want you to sort of tell me what your reaction is to that?

Do you see a new team coming in with a different attitude toward the president's policies?

SEC. PANETTA: No, I -- I really don't. I mean after all, the president is the person who makes policy with regards to foreign affairs and defense policy.

CROWLEY: Sure. But this was about pushback. And the suggestion, I think, is that you all do push back and that this team might not.

SEC. PANETTA: Well, you know, I -- I've got to tell you, anybody who knows John Kerry and anybody who knows Chuck Hagel and I've been with them in meetings and I've been with them in conferences and I've been with them on issue debates.

And they push back. Believe me, they push back on the issues. And I think -- I think that they're, you know, in -- in the Situation Room, everybody has to give their honest views. And I think they won't hesitate to give their honest views.

CROWLEY: One of the things where there might be pushback, where we're sort of looking ahead, is we're now hearing from some senior types in the White House that they may not want any troops to remain in Afghanistan after 2014.

Right now, as you're looking at the situation, and you've trained troops in Afghanistan.

SEC. PANETTA: Right.

CROWLEY: And this is for both of you, but, General, since you -- you've trained troops over there, we never hear very good reports. I think the last sort of official one we saw was that one -- one Afghan battalion of all of them, was able to work without U.S. ground or air support.

Is -- are Afghan troops and this Afghan security, including the police, can it be ready in 2014 to have no U.S. support?

GEN. DEMPSEY: Well, first of all, I've never heard anyone suggest -- no one has ever suggested zero to me. And I think that the ultimate number will be based on the mission and how deeply we want to be involved with their continued development and also what they want, I mean, literally, what the sovereign nation of Afghanistan wants.

John Allen has got a very well thought out campaign plan. As we look at the different options for both presence after '14 and how we get from here to '14, we're basing it on keeping three things in equilibrium -- the campaign objectives, which are very well laid out in Chicago and has been with our NATO allies. And on retrograde, we've got pretty significant challenge of getting ourselves out of Afghanistan in terms of equipment and force protection.

And we'll keep those three things in equilibrium.

CROWLEY: Sixty-six thousand troops there now.

What sounds to you all like a reasonable number at the end of 2014?

What should the Afghan government be able to do with how many U.S. troops?

SEC. PANETTA: Well, look, the -- the most important thing that's happened is that the Afghan Army has become operational. They've developed their ability to provide security. We couldn't make a transition in the areas we've made a transition, which involves over 75 percent of the Afghan population right now, is in -- under Afghan control and under Afghan security.

We couldn't do that if there weren't an Afghan Army that was becoming much more capable at doing their job.

If we maintain a 352,000 number, which is what we're -- we're -- we're trying to achieve, if we maintain that and they become good, that is going to determine, then, the level of enduring presence that we will have once we reach the end of 2014.

CROWLEY: What's your feel for it now?

GEN. DEMPSEY: Well, my feel for it now is that the -- the missions that we've accepted post-'14, with the Afghan government and our NATO allies, which largely, relate to a counter-terror mission, continuing to keep pressure on transnational global terrorism, as well as the continued development of the Afghan security forces.

My instinct that it -- that their development is moving at a pace and their acceptance of responsibility is moving at a pace that our numbers after '14 can be -- can be modest.

But we will...

CROWLEY: What's that?

What -- can you give me a number?

GEN. DEMPSEY: No, I can't.

CROWLEY: What's modest?

GEN. DEMPSEY: I can't give you a number because, first of all, I'm not going to announce a number on...

CROWLEY: (INAUDIBLE)?

GEN. DEMPSEY: -- on CNN on Sunday...

CROWLEY: Why not?

GEN. DEMPSEY: -- afternoon. Because I don't know the number.

CROWLEY: It sounds reasonable to me. (Laughter.)

GEN. DEMPSEY: No, I really don't. And, look, we're in the business of negotiating with ourselves and John Allen the mission and how best to accomplish it, trying to look two years into the future.

We really don't have a number selected yet.

CROWLEY: Let me ask you about another hot spot in the -- the past few days, and that is Turkey.

Do you have any reason to believe that what appears to be this suicide bombing in Turkey was linked to the Patriot missiles that we sent there recently?

SEC. PANETTA: No, I have no evidence of that. Clearly, this was a terrorist act. You know, obviously, we've got to find out what -- what the motive was here. But, as far as I know, it was not linked to that.

CROWLEY: Do you have any sense of what this was about? Was this an internal thing and they just chose the US...

GEN. DEMPSEY: Well...

CROWLEY: (INAUDIBLE)?

GEN. DEMPSEY: -- that's the question, but the intel community -- and this is a very recent event. And the intel community has exactly that question to -- to wring out and to see if there was a connection.

But at this point, as the secretary said, we have no indication that it was.

CROWLEY: So it's -- you don't see it as U.S.-related so much as probably Turkish-related?

SEC. PANETTA: Well, too, it seems to involve somebody who was an extremist in Turkey. And, I guess, you go -- we're going to have to find out what was his cause that that provided the incentive for him to do this.

CROWLEY: Let me ask you about Benghazi. First, you'll be testifying on Capitol Hill before you leave office?

SEC. PANETTA: I -- I've -- we're -- we're working on that right now. Obviously, they've -- they've asked us to testify and we're happy to do that. So we -- we probably will have that opportunity.

CROWLEY: So one of the outstanding questions out there has been why weren't there -- why wasn't there someone to come help?

Why didn't you -- we know that you did move ships closer?

We know that at the airbase in Sicily, you brought in, a strike force.

Why didn't you, in a seven hour time frame that this took place, why couldn't the strike force have said, even if you didn't know what was going on, just get closer. Go as though you're going to go there and we'll let you know what we find out?

SEC. PANETTA: Because, very frankly, intelligence did not provide, any warning that this, in fact, was going to happen. I mean we -- we deployed. We knew, you know, we knew there were problems there. We moved forces into place where we could deploy them quickly if we had to. They were ready to go.

But very frankly, by the time we got the information as to what, in fact, was taking place there, just distance alone made it very difficult to respond quickly. That's just the nature of dealing with the Middle East.

CROWLEY: Well, when did you learn, if this was a seven-hour battle -- and we don't know when people died in there, when the ambassador died. But if this was a seven hour battle, U.S. -- a U.S. strike force couldn't have gotten there in time to be of some service?

GEN. DEMPSEY: You know, it wasn't a seven hour battle. It was two 20 minute battles separated by about six hours. And -- and that's a -- that -- the -- the idea that these were -- was one continuous event is just incorrect.

And the nearest -- for example, the nearest, aircraft, armed aircraft, were -- happened to be in Djibouti. The distance from Djibouti to Benghazi is the distance from Washington, DC to Los Angeles. There's -- there is -- there's some significant physics involved and, in the time available, given the intelligence available, I can -- I'm -- I have great confidence in reporting to the American people that we were appropriately responsive given what we knew at the time.

SEC. PANETTA: Candy, the answer to these things -- and, you know, we've -- we've learned some lessons, obviously, from what happened in Benghazi. But the answer is, you have to develop host country capability there. Every embassy we have, the host country has to provide good security.

CROWLEY: But you knew Libya was really not capable...

SEC. PANETTA: No, I -- I...

CROWLEY: -- at that point?

SEC. PANETTA: I understand that. But you have to be able to -- to rely, in part, on their capability to provide security. Secondly, you've also got to be able to harden the facility, so that, you know, it is well protected.

And thirdly, if -- if none of that works, then, obviously, you've got to have a response team that's ready to respond.

But to do that, you've got to have intelligence that tells you this is trouble. There is a risk here. We can't...

CROWLEY: You had an ambassador...

SEC. PANETTA: -- we can't...

CROWLEY: -- telling people...

SEC. PANETTA: -- this is not...

CROWLEY: -- there was trouble.

SEC. PANETTA: -- this is not 911. You cannot just simply call and expect within two minutes to have a -- a team in place. It takes time. That's the nature of it.

Our people are there. They're in position to move. But we've got to have good intelligence that gives us a heads-up that something is going to happen.

CROWLEY: The -- the base in Italy is closer, the air base in Italy would have been a closer, team to...

SEC. PANETTA: (INAUDIBLE).

CROWLEY: -- the strike force. (INAUDIBLE), right?

So, again, why wouldn't you, knowing that there had been an attack, not knowing how long it was going to go on, why wouldn't you, say, get on a helicopter, get on a plane...

SEC. PANETTA: Well...

CROWLEY: -- get on a, you know...

(CROSSTALK)

CROWLEY: -- I mean, you know, and I realize these are sort of basic questions (INAUDIBLE), but I think people are looking and saying, couldn't they have...

SEC. PANETTA: Well, I...

(CROSSTALK)

GEN. DEMPSEY: I'm sure we'll have a chance to answer these exact questions on Thursday, when we testify.

But the fact is, we did exactly what you said. As soon as we knew something happened, the Secretary gave us vocal instructions to begin moving, forces to a higher alert posture and to meet them with aircraft necessary to move them and then in -- in -- including the transit time to give him an estimate of how quickly we could have something there.

We did exactly what you just said. But you can't be everyplace. And I might remind you, it was 911 elsewhere in the world, not just in Libya.

CROWLEY: Sure.

Would you agree that the consulate in Benghazi was woefully under protected?

SEC. PANETTA: I think, the secretary of state has -- has indicated that they should have had more security there.

CROWLEY: Would you do anything different militarily knowing now what you know about what went on?

GEN. DEMPSEY: Well, we have -- we actually have. We've taken the Accountability Review Board results. We've partnered with the secretary of State in her review of embassy security around -- especially around that part of the world. And we are taking steps.

CROWLEY: And would you now, though, in hindsight say we should have, could have, would have sent this group there?

We might have been able to do some good if we had done X, Y or Z?

GEN. DEMPSEY: No.

CROWLEY: So nothing -- you would change nothing about it?

SEC. PANETTA: Look, you know, I -- I think -- I think in -- in these situations, you've got to look at what we were facing, what we knew, what intelligence we had in order to respond. Admittedly, better intelligence about what was taking place there would have given us a head start.

CROWLEY: Why isn't there better intelligence?

It's not like the intelligence community is under funded. And it seems like any time we come into something where it's been a tragedy, it's always the intelligence community. You've been there.

SEC. PANETTA: Yes, no, it's...

CROWLEY: I mean, so...

SEC. PANETTA: I was director of the CIA.

CROWLEY: Yes.

SEC. PANETTA: So, you know...

CROWLEY: Exactly.

SEC. PANETTA: -- I...

CROWLEY: So...

SEC. PANETTA: -- I (INAUDIBLE)...

CROWLEY: -- it seems like it's always the CIA's fault.

SEC. PANETTA: -- I say this without, you know, demeaning our -- our efforts at intelligence, but the fact is, we -- you know, there are areas in the Middle East where we do not have the kind of intelligence we should have in order to give us a heads-up about these kinds of attacks.

That's the reality.

CROWLEY: Let me...

SEC. PANETTA: We've got to do better at that.

GEN. DEMPSEY: And you're discounting the number of things we do avoid with good intelligence.

CROWLEY: Right. Those are -- well, obviously, for a lot of reasons we don't always hear about those.

So let me ask you about the Israeli strike deep into Syria.

Did you know about that in advance and did anyone say bad idea, good idea, or was it just -- I -- I know that you were meeting with the head of the -- the Israeli intelligence forces.

Were you all informed?

SEC. PANETTA: We're -- we're not -- I'm not going to discuss the details of -- of that of what happened or didn't happen there. What I will say is this, that we are concerned about the danger of sophisticated weapons like SA-17s and CBW, chemical and biological weapons, falling into the hands of terrorists. That is something we're concerned about. And we do planning every day to try to make sure that we're in a position where we can make sure that doesn't happen.

GEN. DEMPSEY: The Israeli officer about whom you speak was in my office in preparation for a meeting of my counterpart from Israel, Lieutenant General Benny Gance (ph), and not in any way related to that incident that was reported.

CROWLEY: OK. But you all can't tell whether -- I mean I'm assuming if you weren't informed, you'd tell me, so...

GEN. DEMPSEY: Yes, we're not going to comment...

CROWLEY: -- the reverse is true, OK?

GEN. DEMPSEY: We're not going to comment on that.

CROWLEY: So you've talked about the groundwork being laid. I mean everyone talks about how Assad surely will fall at some point. And when that happens, how does the U.S. make sure that al Qaeda or other terrorist organizations that might be loosely affiliated don't get ahold of chemical weapons, don't -- begin to suck up all the weapons that are already there?

Every -- what happened in Libya, in some cases, what is that groundwork like?

GEN. DEMPSEY: Well, I think what -- what you'd want to -- what you'd expect us to be doing is teaming, collaborating, planning with our partners in the region. We have a NATO partner in the north, in Turkey. We have a NATO partner in the north, in Turkey. We have a very strong partner in Jordan. Of course, you mentioned Israel to the west, all of whom share common interests in making sure that these -- these spillover effects don't affect them.

And that's what we're doing. We're planning. We've got options for any number of military contingencies. And we're maintaining both a deterrent and a preparedness posture.

CROWLEY: Do the military contingencies include U.S. forces?

Or is this something that you see as a regional thing, securing the ground, as it were, in Syria?

GEN. DEMPSEY: Well, we are better when we operate with partners, especially in that part of the world.

But of course, any -- any option we would -- we would probably be asked to provide, at least the capabilities no one else has. And we have some pretty extraordinary capabilities.

CROWLEY: And that's -- intelligence gathering certainly would be one of them.

(CROSSTALK)

CROWLEY: But what about the use of force?

SEC. PANETTA: Well, I...

CROWLEY: The use of forces, I guess, (INAUDIBLE)?

SEC. PANETTA: I think, you know, a lot depends on what the situation is. If Assad suddenly comes down, you know, is it a permissive situation where there's a -- there's a kind of peaceful transition to another form of government, which would be a very different situation than a hostile situation, where there's chaos.

So we've got to be able to plan for, you know, every contingency in order to be able to ensure that we are taking steps to protect that CBW so it doesn't fall into the wrong hands and try to ensure that these other weapons don't fall into the wrong hands.

CROWLEY: Let me talk to you about Niger really quickly, because Northern Africa becoming suddenly, at least to us suddenly, such a hot spot. I was talking to someone in the intelligence community recently who said what we don't know is whether this is the last refuge of al Qaeda or whether this is a beachhead?

Which is it?

Is this where al Qaeda is beginning to gather?

Are we paying enough attention or is this sort of a last gasp, like the last place they can go, or they've been pushed there?

SEC. PANETTA: I think, you know, it -- you've got to look at the whole picture on al Qaeda. We've gone after core leadership of al Qaeda in the Fatah and in Afghanistan. We've gone after them in Yemen. We've gone after them successfully in Somalia.

We were always aware that there was AQIM in North Africa. And now, we're focused on AQIM as a result, obviously, of the French action. But we were also anticipating that we would have to move into North Africa to go after al Qaeda.

Wherever they are, we have to make sure they have no place to hide. The bottom line here is al Qaeda is our enemy and we have to make sure we go after them.

CROWLEY: Niger is -- are the intelligence (INAUDIBLE) going to be enough?

Are you going to anticipate other things (INAUDIBLE)?

GEN. DEMPSEY: Well, first of all, we haven't decided that those will be based there. The president of Niger has offered that and -- and we're -- by the way, we're in consult not just bilaterally with those nations in the region, but with the -- the regional security elements, like ECOWAS, the Economic Community of West African States, as we were with AMISOM in Somalia.

And -- so we've got a -- we've got a pretty effective model that we can apply if we take a policy decision to do so.

CROWLEY: OK, and let me just, finally, I want to play you something from your predecessor as he was leaving office.

(BEGIN VIDEO CLIP)

FORMER SECRETARY OF DEFENSE ROBERT GATES: Any future Defense secretary who advises the president to again send a big American land army into Asia or into the Middle East or Africa should have his head examined, as General MacArthur so delicately put it.

(END VIDEO CLIP)

CROWLEY: So, first of all, do you agree with your predecessor on that?

And, second of all, give us your final thought here as you prepare for the -- at least the last month or so of your...

SEC. PANETTA: Well, you know...

CROWLEY: ... tenure.

SEC. PANETTA: ... my -- my sense is that, that the defense of this country has to be prepared to respond to any contingency. And I wouldn't rule out any action that the president of the United States might decide needs to be taken against any crisis.

So, you know, while I understand the concerns that Bob had, I just would not rule out any option in -- in today's world.

We face a lot of threats today. I -- I -- I feel, as secretary of Defense, I've been honored to -- to serve at the Department of Defense.

We have -- we have the strongest military power on earth. But we -- and we're dealing with a lot of threats in today's world.

The biggest concern I have, frankly, right now, is the uncertainty, the budget uncertainty on Capitol Hill, because if -- if the sequester is allowed to go into effect, I think it could seriously impact on the readiness in the United States. And that's a serious issue.

CROWLEY: And I would assume you agree with those parting words.

GEN. DEMPSEY: I -- I couldn't agree more. We -- we face a true readiness crisis.

CROWLEY: OK.

Gentlemen, thank you so much for being with me.

SEC. PANETTA: Thank you.

-END-