(CBS NEWS) -- Below is a transcript of the March 2, 2014 edition of Face the Nation. Guests included John Kerry, Chuck Hagel, David Ignatius, Major Garrett, Danielle Pletka, Michael O'Hanlon, Elizabeth Palmer, Charlie D'Agata and David Martin.
ANNOUNCER: From CBS News in Washington, FACE THE NATION with Bob Schieffer.
BOB SCHIEFFER: Today on FACE THE NATION, the crisis in Ukraine intensifies. With Russian forces in Crimea, Ukrainians call up their military reserves and beg the international community for help.
ARSENIY YATSENYUK: We are on the brink of the disaster.
BOB SCHIEFFER: We'll go to Ukraine for the latest news. We'll hear from Secretary of State John Kerry and Secretary of Defense Chuck Hagel. We'll have analysis on all of it from our panel of experts and with Russia once more in the news. We'll look back at a milestone FACE THE NATION interview. Sixty years of news because this is FACE THE NATION.
Good morning again. Well, there are developments from overnight on the crisis in Ukraine. Russian President Vladimir Putin has moved troops into Crimea that is a region with a mostly Russian-speaking population, a move that the Ukrainian prime minister says is a "declaration of war." Vladimir Putin and President Obama spoke yesterday for ninety minutes, a conversation the White House described as the "toughest of [the Obama] presidency." As for Ukraine, a new government there is mobilizing its reserves and authorizing the call up of all men under the age of forty. CBS News correspondent Charlie D'Agata is in Kiev this morning. Charlie, people are again out in the square, what's going on there?
CHARLIE D'AGATA (CBS News Correspondent): Yeah. Bob, there are about a thousand demonstrators and protesters that arrived here. The numbers have swollen since the situation in Crimea. Today, we've been hearing them saying, down with Russian President Vladimir Putin. They're calling him a liar and a dictator. The Ukrainian prime minister said that the country is on the brink of disaster and they're preparing for war. And the way they've done that is they put the standing military, hundred and thirty thousand people or so on high alert. But they've also put the call out to reserves, using websites, radio, saying to stand by for further information and instruction. They may have to go to military centers around Kiev and around Ukraine and report for duty, fighting men under forty years old. Now we haven't seen, it doesn't feel like this area itself is under threat where there's no military presence at the airport or around the squares or on the roads. But the real concern is around the eastern border along the border with Russia where you have a lot of Russian-speaking people, a lot of Russian loyalties and the concern is whether Russian troops will advance in those areas, more importantly, what Ukrainian forces can do if anything to defend against them.
BOB SCHIEFFER: All right. Charlie, thank you so much.
CBS news foreign correspondent Elizabeth Palmer is in Southern Ukraine this morning and she is en route to the Crimea region. Liz, what's the latest?
ELIZABETH PALMER (CBS News Foreign Correspondent): Thousands of Russian troops are fanning out over the Crimean peninsula taking control. They're uniformed and they are setting now up at strategic locations. Many of them were based in the Crimea anyway with the Russian Black Sea fleet on a lease agreement with the Ukraine. Well, they've left the bases and they're out on active duty. Also it appears that some hundreds of soldiers have been brought in from elsewhere in Russia. Now not a shot has been fired. This has been very peaceful. In fact, a lot of the people, Russian speaking, pro-Russian population of Crimea, have welcomed those troops. And their mission, which according to Vladimir Putin, is to protect the Russian-speaking population.
BOB SCHIEFFER: And I understand you've had quite an eventful trip en route to the Crimea.
ELIZABETH PALMER: That's right, Bob. We drove a long way from Kiev and finally got to this rather informal border across the neck that leads on to the Crimean peninsula and there was a barricade in the road manned by what we thought were Ukrainian troops. Well, it turns out these guys had switched sides. They had hoisted the Russian flag at their barricade and they were backed up by a group of local men in camouflage gear also armed who came and raided our truck, took our gear apart and stole our body armor, not only did they steal it, they put it on right away. Helmets and flak jackets walked off with that and told us to get out of there that they weren't going to let us in.
BOB SCHIEFFER: Okay. Well, be careful for the rest of the trip, Liz. And we'll check in with you later today.
We are joined now by Secretary of State John Kerry who is in Boston this morning. Mister Secretary, thank you for being here. The Ukrainian prime minister says this morning that Russia's actions amount to a declaration of war and he says we are on the brink of disaster. Do you agree with that?
JOHN KERRY (Secretary of State): Well, it's-- it's an incredible act of aggression. It is really a stunning willful choice by President Putin to invade another country. Russia is in violation of the sovereignty of Ukraine. Russia is in violation of its international obligations. Russia is in violation of its obligations under the U.N. Charter, under the Helsinki Final Act. It's a violation of its obligations under the 1994 Budapest Agreement. You just don't in the twenty-first century behave in nineteenth-century fashion by invading another country on completely trumped up pretext. So, it is a very serious moment. But it's serious not in the context, Bob, of Russia-U.S. it's serious in terms of sort of the-- the modern manner with which nations are going to resolve problems. There were all kinds of other options still available to Russia. There still are. President Obama wants to emphasize to the Russians that there is a right set of choices that can still be made to address any concerns they have about Crimea about their citizens but you don't choose to invade a country in order to do that.
BOB SCHIEFFER: The President spoke to Vladimir Putin we're told for ninety minutes yesterday. The White House is describing it as the toughest phone call of his presidency. Do you think it had any impact?
JOHN KERRY: Well, we're going to have to wait and see. But I think it was a very important conversation, the President was very strong. He made absolutely clear that this was unacceptable that there will be serious repercussions if this stands. The President asked Mister Putin as-- in fact, told Mister Putin it was imperative to find a different path to rollback this invasion and undo this active aggression. He pointed out the many different ways in which Russia could have chosen to act. I mean if you have legitimate concerns about your citizens, go to the United Nations, ask for observers, engage the other country's government. There were any number of choices available to Russia. Russia chose this brazen act of aggression and moved in with its forces on a completely trumped up set of pretext, claiming that people were threatened. And the fact is that that's not the act of somebody who is strong, that's the act of somebody who is acting out of weakness and out of certain kind of desperation. We hope that Russia will turn this around. They can. Again and again all week, President Obama and I and others have insisted that we believe there's a way to deal with this issue. This doesn't have to be a zero sum game. It is not Russia versus United States, Russia v. Europe. This is about the people of Ukraine. The people of Ukraine are the people who initiated what is happening there. Their President Yanukovych supported by Russia lost all support, all legitimacy. He fled in the night, his own supporters deserted him. They went to their parliament and they voted according to their parliamentary process. So this is a democratic process that has placed this new government where it is and President Putin and Russia ought to respect that.
BOB SCHIEFFER: Mister Secretary, when you come right down to it the President says there's a cost, and I suppose there are certain diplomatic things you could do. You could boycott the G8 and so on but when you come right down to it, what can we really do here? I mean I don't suppose anybody thinks we're going to declare war on Russia here and send military forces in there?
JOHN KERRY: Well, there are very serious repercussions that can flow out of this. There are broad array of options that are available, not just to the United States but to our allies. I spent yesterday afternoon on the phone with many of my counterparts, I talked to ten of the foreign ministers of those countries most engaged in the G8, plus, some others. And all of them, every single one of them are prepared to go to the hilt in order to isolate Russia with respect to this invasion. They are prepared to put sanctions in place. They're prepared to isolate Russia economically. The ruble is already going down. Russia has major economic challenges. I can't imagine that an occupation of another country is something that appeals to people who are trying to reach out to the world and particularly if it involves violence, I think they're going to be inviting major difficulties for the long term. The people of Ukraine will not sit still for this. They know how to fight. They have demonstrated remarkable bravery, Bob. I mean you think about Yanukovych positioning his snipers on the rooftops of Kiev and-- and-- and notwithstanding people falling to the right and to the left, these marchers kept on marching. And they demanded their freedom. They demanded their opportunity to have their voices heard without a kleptocracy and a tyranny governing them. I think Russia needs to think very carefully about the choice that it's making. And there are visa bans, there are asset freezes, there is isolation with respect to trade and investment. American businesses may well want to start thinking twice about whether they want to do business with a country that behaves like this. These are serious implications.
BOB SCHIEFFER: Let--
JOHN KERRY: I know from my conversations yesterday, every one of our allies and friends are determined to stay united and to make clear there is a price attached to this kind of behavior.
BOB SCHIEFFER: Are we actually prepared, Mister Secretary, to, boycott the G8 meeting there?
JOHN KERRY: Well, absolutely prepared to, if this-- if we can't resolve it otherwise but, the preference of the President, myself, the entire administration is to resolve this. We're not trying to make this a battle between East and West. We don't want to return to the Cold War. Nobody wants this kind of action. There are many ways to resolve this problem. As President Obama urged President Putin yesterday this is the moment to engage directly with the government of Ukraine. This can be resolved. We're prepared to mediate, to help. We're prepared to provide economic assistance of the major sort. We want the Congress to join us in providing that assistance. We hope that-- that this can be resolved according to the standards of the twenty-first century, and, frankly, according to the standards of the G8. If Russia wants to be a G8 country it needs to behave like a G8 country. And I guarantee you that everybody is determined that if this cannot be resolved in a reasonable, modern twenty-first century manner, there are going to be repercussions.
BOB SCHIEFFER: All right. Well, Mister Secretary, thank you so much for joining us this morning.
JOHN KERRY: Thank you.
BOB SCHIEFFER: When we talked to Secretary of Defense Chuck Hagel on Friday he set flatly it would be a mistake for the Russians to cross the border into Ukraine.
CHUCK HAGEL (Secretary of Defense): It's serious. We continue to talk with the Russians. I just came back from a NATO ministerial meeting couple of days ago as you know. That was much the topic of the conversation there. Strong support from all twenty-eight members of NATO, of Ukraine, their territorial integrity, their independence. This is the time for careful, wise, steady leadership. The tensions increase and I think all nations have to be very careful here of not promoting any more tension through provocative actions. So we're very close to it. We stay very close to it.
BOB SCHIEFFER: What would we do if the Russians' forces started rolling into other parts of Ukraine?
CHUCK HAGEL Well, I won't get into the different specific options but this could be a very dangerous situation if this continues in a very provocative way. We have many options like any nations do. We're trying to deal with diplomatic focus that's the appropriate, responsible approach. And that's what we're going to continue doing.
BOB SCHIEFFER: But we do have a plan?
CHUCK HAGEL: Well, we have plans for everything all the time.
BOB SCHIEFFER: When you come right down to it what can we really do there?
CHUCK HAGEL: Well, again, we've got different options but for right now the responsible thing is to continue to work through the diplomatic channels and that's what we're doing.
BOB SCHIEFFER: What-- what is our strategic interest in Ukraine?
CHUCK HAGEL: Well, first, it's a sovereign, independent nation. And we support that sovereignty and that independence. They have been a responsible new independent member of the global community since the implosion of the Soviet Union. We have European Union and NATO interests that border Ukraine. These are people who want to be free, who deserve to be free, deserve their-- their own way of life, elected leaders. And so like our position with any sovereign free nation that's the principle upon which the United States stands and I think all Western countries in respecting people's rights and that's where you start.
BOB SCHIEFFER: This, in your view, would be a mistake for the Russians if they decided to go into the Ukraine?
CHUCK HAGEL: I think it would be a mistake. And this would set in motion so many different dynamics that are not in anyone's interest.
BOB SCHIEFFER: We'll have a lot more of our interview with Secretary Hagel in Part 2 of FACE THE NATION.
More on the crisis in Ukraine in one minute.
BOB SCHIEFFER: We're back now with David Ignatius of the Washington Post and CBS News national security correspondent, David Martin. Over at the White House this morning our chief White House correspondent Major Garrett. Major, you did considerable reporting yesterday on the President's phone call to Putin. You said officials were telling you this was the toughest phone call of his administration. What-- what are they thinking about over there this morning? What-- what do they see as what might happen here?
MAJOR GARRETT (CBS News Chief White House Correspondent): Well, Bob, the White House knows that Putin has the facts on the ground. He has a military force in the Crimea. What the United States and its European partners have is international law, international norms and the threat of pronounced economic isolation for Russia if it continues with, what Secretary of State Kerry just called, a brazen breach of international law. Now, the reason the administration uses that phraseology is because that's what Vladimir Putin conspicuously and constantly talks about in other parts of the world, Syria, Iran. It's always talking about other nations, specifically, the United States following international norms. Well, the United States is now calling Russia out on its behavior saying you're violating the self same standards you constantly seek, told the rest of the world to and if you continue with this behavior, you're going to be isolated not only diplomatically but economically. And right now the administration is working behind the scenes to have this IMF team, International Monetary Fund team, that's due to arrive in Kiev later this year, not just come there to say hello but have a specific aid package for the Ukrainians to say the West is here to help you economically. And as it has with the situation in Crimea, the administration will invite the Russians in. Look, participate internationally if you have legitimate concerns about the Russians in Crimea but if you don't, your isolation, economically and diplomatically, will only increase and the White House believes that is a greater force of leverage than they believe Putin has, even though, he has the forces on the ground in Crimea.
BOB SCHIEFFER: All right. Well, thank you very much, Major.
David, what's happening militarily? I don't think anybody, as I said to Secretary Kerry and he didn't dispute this, nobody's saying about going to war with-- with Russia right now. Is there any kind of military movement in that part of the world right now?
DAVID MARTIN (CBS News National Security Correspondent): Not on--
BOB SCHIEFFER: Ships or anything like that?
DAVID MARTIN: --not on the part of the United States. The only movement right now is Russian troops continue to flow in to Crimea. It's hard to put a number on it but whatever the number, it's a fait accompli and you notice that Secretary Kerry said if this stands, he did not say, this shall not stand as George H. W. Bush once said of the invasion of Kuwait. The U.S. has no military options. It has no treaty obligations to come to the defense of Ukraine. Putin knows that. And that is why he has acted so decisively. The big question is whether he is going to order Russian troops into the rest of Ukraine. That would turn what is now a crisis into, I think, a full-scale (INDISTINCT).
BOB SCHIEFFER: Well, explain to us exactly what's happened here. The Russians have a base. They have a military base in Crimea. There are Russian troops there already. Apparently, some of them have been moved outside of the base now--
DAVID MARTIN: Yeah.
BOB SCHIEFFER: --but they haven't moved beyond the borders of Crimea.
DAVID MARTIN: That's right. They haven't crossed over where Liz Palmer was standing into the-- into the rest of Ukraine. And this-- this morning's intelligence is that there is no sign that they are preparing to do that which is in the context to everything else that's happened, very good news.
BOB SCHIEFFER: So, David, how do you assess what's happened so far and-- and what-- what happens now?
DAVID IGNATIUS (Washington Post): Well, I-- I think we saw the parameters of U.S. policy in the interviews with Secretary Kerry and Secretary Hagel. Secretary Kerry used very strong language, a brazen act of aggression, violation of international law. He called on the Russians to roll back this invasion. But when you got down to the specific tools, the ways in which the United States will make Russia pay a cost for what it's done, these are milder diplomatic options. As David said, I-- I'm-- I'm told by my sources in the Pentagon, there is no ship moving in the Mediterranean. There are no NATO troops moving on the land mass of Europe. We are not preparing for military response. If you're talking about roll back, you're talking about Putin realizing that this course which reanimates Cold Car psychology in Eastern Europe is not in his interest. And-- and I do think that the final point to add here is the real problem today is Vladimir Putin's. Vladimir Putin has a Ukraine that is coming apart. He has invaded a small southern piece of it where Russian interests are very strong but in the Ukrainian capital, you have demonstrators in the-- in the streets. These are demonstrators who evicted a pro-Russian regime in the-- in the Ukraine. And they're-- they're not prepared to go backwards. So I-- I-- the choices Putin faces going forward are very, very backwards.
BOB SCHIEFFER: Well-- well, explain to me about the Crimea. It is a part of Ukraine but it-- someone said to me last night it's very much like San Diego. You have a large retired military population there, mostly Russians, lot of the people there speak Russian. And-- and most of the people there are-- are pro-Russian. You heard Liz Palmer say nobody-- lot of these soldiers change sides here.
DAVID IGNATIUS: Crimea became part of Ukraine only in 1954. Crimea was historically part of Russia. And Khrushchev, when he was the-- the Soviet leader, gave it to Ukraine in a gesture that mystified some people but what you say is true. I don't know if it's San Diego but it has-- it is-- where they-- the Russians have their biggest naval base, where they-- where they a lot of retirees go and people speak Russian. So it's-- it's-- it's a part of-- of-- of Ukraine that looks toward Moscow.
BOB SCHIEFFER: Let me stress. I didn't mean that there are a lot of communists in San Diego. I meant there's a large retired military population there. And it's a very, very conservative place. So what happens now, David?
DAVID MARTIN: Well, you-- you have this base of the Russians in-- in Crimea which is a valuable strategic asset for them. This is their way to get out into the Mediterranean to go to places like Syria. And I don't think they're going to pull out of there until they're satisfied that those-- those bases are secure for the indefinite future.
BOB SCHIEFFER: What does Putin want here?
DAVID IGNATIUS: This action in Crimea and-- and over Ukraine follows a series of efforts by Putin to reestablish, you know, the-- the spirit, if you will, of-- of the Soviet Union if not the actual physical possession of-- of those republics. I mean the Sochi Olympics was a kind of exercise in nostalgia for the good old days of-- of Soviet power. And-- so I think the danger here is if Putin is tempted to think that he can reoccupy countries like Ukraine. You know, he did invade Georgia in-- in 2008. Again, an attempt to assert Russian power in its-- in its neighborhood. If he has this romance of bringing things back to the way they used to be, that is trouble. That does take us back to the Cold War.
BOB SCHIEFFER: Well, I'm not sure that he really would take Ukraine back. I mean this place is an economic basket case.
DAVID MARTIN: Well--
BOB SCHIEFFER: He wants to have influence there. He wants to control events there but it also carries a pretty good price.
DAVID MARTIN: This is not the Soviet military of the-- the Cold War. This is a-- a much reduced and a much weakened military which in the past, I don't know, five years has been starting to-- to make a comeback. But he's got to be careful about how much he bites off here. I mean, Crimea is one thing. Ukraine would be an entirely different operation.
BOB SCHIEFFER: All right. We have a lot more to talk about on this but we'll take a break right here and we'll be back.
BOB SCHIEFFER: We'll have lot more on the crisis in Ukraine; plus Part 2 of our interview with Secretary Hagel coming up on FACE THE NATION. So stay with us.
BOB SCHIEFFER: Some of our stations are leaving us now. But for most of you we'll be right back with a lot more FACE THE NATION, including analysis on the crisis in Ukraine with Danielle Pletka of the American Enterprise Institute, Michael O'Hanlon of the Brookings Institute. Plus, Defense Secretary Hagel talks about scaling back the military.
Stay with us.
BOB SCHIEFFER: And welcome back to FACE THE NATION Page 2. You know one irony of this week is that all of this story, the Ukraine story broke just after Secretary of Defense Hagel had announced plans to scale back the American military. We're going to pick up the interview there.
I want to talk to you about the military budget that you outlined.
CHUCK HAGEL: Mm-Hm.
BOB SCHIEFFER: You want to reduce the size of the army to the smallest size since before World War II. How do you reduce the size of the American military without making it look like--
CHUCK HAGEL: Hmm.
BOB SCHIEFFER: --to the people around the world that we're somehow retreating, that we're withdrawing from all of this.
CHUCK HAGEL: You start, Bob, with the reality of where we are in the world today. This budget that-- it is the first budget in twelve years that's not a budget based on war footing. We've been at war for thirteen years constantly--two wars. We're out of one war, Iraq. And we're coming out of the longest war we've ever been, Afghanistan. Not unlike after every war the United States has been in, you reset your posture. You reset your assets. You reset your-- your whole enterprise based on the new realities and based on preparing that institution for the challenges of the future. But to answer your question, then how do you adjust to the dangerous complicated world that we're in we've increased, for example, cyber assets, increased special operations. We're focusing on readiness, capability, our capacity, our ability to do the things that we need to do in the strategic interests of the strategic guidance that the President laid out in 2012.
BOB SCHIEFFER: You say we're coming out of two wars, and, yes, that's true. But we're not necessarily coming away victors. We're just coming out of those wars. The enemy is still out there.
CHUCK HAGEL: Of course, the threats are out there. Of course, the threats are shifting. Cyber is a good example. Five years ago there wasn't the same focus or reality of what a-- a cyber attack could do to this country, paralyze this country, bring our economy down without any nation firing a shot, not knowing where it comes from, special operations. The-- the terrorist threat that still is around the world will be with us, I suspect, for some time. We've- we've got to figure out how best we do that. The strategic priorities that we've laid out based on the president's strategic guidance plan, first, defend the homeland. Second, continue to build capacity in securing our world through our alliances, through our treaty obligations, through our commitments all over the world, not retreating from the world. We're-- we're still going to-- going to be there, also defeating aggression in the world and winning a war against any adversary anywhere in the world. That hasn't changed.
BOB SCHIEFFER: But--
CHUCK HAGEL: But how you do it, Bob-- how you do it is always going to be adjusted to the realities of the time and the challenge.
BOB SCHIEFFER: --but you're not suggesting in any any way, shape, or form that we have won these wars, you're--
CHUCK HAGEL: That's not--
BOB SCHIEFFER: --just saying we have to recalibrate the way we continue to fight them.
CHUCK HAGEL: At the peak of Iraq we had a hundred and fifty thousand troops in Iraq, that war. The peak of Afghanistan probably around a hundred and twenty thousand. Those are big numbers. And-- and we-- we-- we don't need those, as you go forward, the same way we did the last thirteen years. So you've got to adjust your force posture. And by the way, it isn't me cutting the budget. It's the Congress' decision on sequestration. So it isn't Secretary of Defense or the President doing this, and I think we should clear that up a little bit here, too. Where-- where are we making decisions and how do we make them, that's a responsibility I have. But also the physical constraints that are being placed on the Pentagon to make very tough choices here are very significant. So what we're talking about is-- is gradually reducing our active duty strength by about ten percent. I mean I don't-- I don't think that's an astoundingly large cut as we adjust in-- we're still going to need a big army.