Following is an excerpt of Condoleezza Rice’s interview with CFR.org.

Rice says international sanctions against Iran are succeeding in driving away investors from the country and harming the economy. But she continued to express support for setting up a U.S. interests section for improving contacts with the Iranian people. Rice put an emphasis on diplomatic efforts to solve nuclear dispute with Iran. Rice also said ""The United States is not going to be able to change every regime in the world."" Rice also credited U.S. democracy promotion efforts with spurring fundamental changes in the discourse on democratic reform in the Middle East.
At the last inauguration, the president announced a bold program about democracy promotion, especially in the Middle East, and you were very much involved in that. Nowadays, we hear less of it and you've also made some statements like, ""The United States is not a NGO and we have to balance our relations with authoritarian countries."" Is that a concession perhaps that there's a realpolitik side to the democracy promotion agenda?
The promotion of democracy is something that the United States has to stay true to, because ultimately our values and our interests are inextricably linked. We've learned that with the collapse of the Soviet Union, which was good for our values and terrific for our interests. So I'm a firm believer that those are linked. On any given day in policy, one has to balance the fact that, yes, sometimes you have to deal with authoritarian regimes. Sometimes you have to deal with friendly regimes that have not made as much progress as you want them to. But unless the United States keeps the lodestar out there of the end of tyranny and that every man, woman, and child deserves to live in a democratic society, it will fall off the international agenda. And that's what the president's speech did. The conversation in the Middle East is fundamentally different today than it was a few years ago as a result, I believe, of American promotion of democratic values.
Just to take for example, Egypt, there were mixed signals that the United States was going to be more supportive of really pressuring Egypt on democratic reforms, but when it came down to it, Egypt was more important on the security front, was useful on (engaging) Hamas and so forth. How do you respond to those concerns?
You have to be able to do both. I personally have advocated strongly for democratic reform in Egypt. Egypt is going to be better off, in fact, more stable ultimately, when Egypt trusts its people more. I do believe that the (September 2005) presidential election was a different kind of election than Egypt had ever had. There was criticism of the president's policies right on the front page of Egyptian newspapers. The café talk in Egypt was extraordinary. And then the (December 2005) parliamentary elections were, frankly, a step back. But I don't think you will ever have another presidential election in Egypt like the old-style presidential elections. These things go in almost stepwise function. You make a lot of progress for a while and then it tends to level out and you make another jump. But what the United States has done is to support reformers, to support democracy-building programs through the Middle East Partnership Program. We both advocate with the governments for everything from individual people to changes in law. You support reformers, but change isn't going to come all in one day.
The latest round of sanctions against iran covers dual-use goods. Are we looking at going down this road of some UN-monitored sanctions regime that's going to try to put Iran in a box like Iraq was?
The sanctions with Iran are a bit different. Yes, they're UN Security Council sanctions, but they're generally against Iranian entities. They go after individual assets of people who are engaged in the policies. We've tried to tailor them not to have a general effect on the Iranian people, but they are having an effect on the Iranian economy because Iran is not able to get the kind of investment or investment support, for instance, from countries in Europe. Western oil companies have all left. Total was the last one to leave. So reputational risk and investment risk is what's driving people out of Iran. It's somewhat different than the comprehensive sanctions that were put on Iraq.
In terms of trying to engage Iran, you've been in favor of opening a U.S. interests section in Iran. That got derailed by various events this summer. What kind of feedback did you get from Iranian officials?
We never proposed it officially. The president made an in-principle decision. We did the work, and then, as you said, the Russian occupation of Georgia, and later the Iranian opposition to our SOFA (Status of Forces Agreement with Iraq), sort of derailed it, but we never really asked the Iranians, so we don't know what they would have said. Sometimes, we heard, even in public pronouncements, that they would be prepared to look at it. But this was always aimed at the Iranian people. It was always aimed at our efforts to reach out to them, to make it easier for them to get visas to the United States, to have a point of contact with the United States of America, much as our interests section in Havana (Cuba) has done. Now, whether the Iranians ultimately would have agreed, I don't know, but I would have hoped that they would have. And had they not, it would have said something about their policies.
On the North Korea file you've been dealing with most recently, can you state what has been the value of the U.S. engagement policy that's been unfolding in the last couple years? How do you tell someone that despite this latest backsliding, this has been a worthwhile move?
You start with the fact that they haven't made plutonium since the Six-Party agreement of September 2005, and that's an important point. They've shut down the reactor (at Yongbyon). They've disabled certain elements of it along with the cooling tower. It's not the permanent disablement that we looked for, but it's a series of important steps. We have negotiated a verification protocol, to which they've agreed. Unfortunately, some of the clarifications that they made to us privately that needed to be made so that there were no loopholes in the verification protocol, they refused to write down. And that's where things broke down. But it also has been of value because the North Koreans are in a situation in which they are confronting Russia, China, the United States, South Korea, and Japan, so that they can't just make this a bilateral problem with the United States. And the fuel oil shipments that they need, they need not just from the United States but also from South Korea. And since South Korea has made clear that their relationship with North Korea depends in part on how denuclearization goes, the North can't enjoy certain benefits while continuing to stall on the nuclear file. But much has already been achieved here. Within the context of the Six-Party Talks you ultimately will get a verification protocol that allows us to deal with a lot of very troubling activities, many of which we've learned more about as the process of diplomacy has gone on.
There were cases in which the U.S. had ongoing dialogues with Russia--Kosovo, Georgia-Abkhazia, the missile defense system. They all seemed to boil over this year. And some of the response has been that the Russia file was neglected, that Russian interests were not being truly taken into account and this was allowed to get out of hand. What is your view on what happened?
First of all, Kosovo came out just fine. The Russians didn't agree, but the independent state of Kosovo was born. But it's still a divided state. But the fact is, the international community as a whole knew that Kosovo wasn't sustainable the way that it was. And perhaps you're not always going to have agreement on something like that. But let me go back to the Russia issue. Now we've had very good cooperation with Russia on global issues, whether it's terrorism or nuclear nonproliferation or really Iran or North Korea. We just sponsored with the Russians a Middle East resolution at the UN a couple days ago, on piracy. You name it. On the global front, we've had very good cooperation. Where we've had trouble is where it's come to Russia's periphery, or the states of the former Soviet Union, because Russia has a view that it ought to have a special role on its periphery. And that special role ought to dictate the policies of those states that are now independent. And our view is that those states have a right to an independent policy, both internally and in terms of their foreign policy. We've never believed that because the United States would have good relations with Georgia or Ukraine or Central Asia, that somehow was a threat to Russian interests. And that's where there's been a problem. And so when you look at Georgia, what Russia did to the Georgians was really uncalled for. But I have to tell you that the unity of the United States and Europe led to the circumstance in which Russia was denied its strategic objectives. It didn't achieve a single one. Instead, the Georgian democracy survived. The Georgian government survived. The Georgian economy didn't collapse. Russia is stuck in Abkhazia and South Ossetia with the resounding support of Nicaragua and Hamas. Their recognition policy was a failure and all that this did was to cause people to question what kind of partner Russia could be. And so, sometimes, it's not neglect of the file, it's that the Russians see things differently. And when they do things like Georgia, the fact that we've been able, in a unified way, to frustrate those strategic objectives speaks very well for policy.