President Barack Obama on Sunday called security issues that led to the deaths of four Americans in the Benghazi consulate attack "a huge problem," although he continued to defend U.N. Ambassador Susan Rice as a victim of political scapegoating by Republicans who have suggested an administration coverup of the situation. 

"We're not going to be defensive about it," Obama said of the State Department review of the attacks during an exclusive interview on NBC's Meet the Press. "We're not going to pretend that this was not a problem.  This was a huge problem.  And we're going to implement every single recommendation that's been put forward." 

Read the full transcript

Saying that some State Department officials "have been held accountable," Obama said that the review of the September 11 attack showed there was "sloppiness" in terms of security measures but that mistakes were not intentional. 

But he defended U.N. Ambassador Susan Rice, who withdrew from consideration to succeed Secretary of State Hillary Clinton after Republicans vigorously opposed her for her role in discussing the attacks after the raid.

"She appeared on a number of television shows reporting what she and we understood to be the best information at the time," Obama said. "This was a politically motivated attack on her.  I mean, of all the people in my national security team, she probably had the least to do with anything that happened in Benghazi."

Obama indicated that intelligence officials have "good leads" as to who carried out the attack.

"With respect to who carried it out, that's an ongoing investigation," he said. "The F.B.I. has sent individuals to Libya repeatedly.  We have some very good leads, but this is not something that I'm going to be at liberty to talk about right now."

Updated 5:20 p.m. - Senate Republicans managed to achieve their goal of blocking U.N. Ambassador Susan Rice from becoming the next secretary of state after Rice, on Thursday, withdrew her name from consideration by President Barack Obama.

Republicans were more measured in their responses to the withdrawal than they had been in their earlier criticism of Rice, whose prospective nomination had come under fire for her role in publicly explaining the Obama administration’s assessment of the Sept. 11, 2012 attacks on a U.S. consulate in Benghazi, Libya.

"I respect Ambassador Rice’s decision. President Obama has many talented people to choose from to serve as our next Secretary of State," South Carolina Sen. Lindsey Graham said in a statement.

Related: Rice drops out of running for secretary of state

Graham, along with Sens. John McCain, Ariz., and Kelly Ayotte, N.H., had led an effort to pre-empt Obama from naming Rice as the successor to outgoing Secretary of State Hillary Clinton.

"I respect Susan Rice's decision and appreciate her commitment to public service," Ayotte said in a statement. "However, my concerns regarding the terrorist attack in Benghazi go beyond any one individual."

Rice told NBC News in an exclusive interview on Thursday that she no longer wished for Obama to consider her for the position. In a letter to the president, Rice said she feared a confirmation fight in the Senate "would be lengthy, disruptive and costly."  The full interview with Rice will air tonight on Rock Center with Brian Williams at 10 p.m ET.

McCain’s office said: “Senator McCain thanks Ambassador Rice for her service to the country and wishes her well.”

Each of the Republicans, though, expressed continued concern about the Benghazi incident in their statements, and said they would continue their efforts to probe the matter.

Obama said he has accepted Rice's decision, hailing her as an "extraordinarily capable, patriotic, and passionate public servant." He said Rice would continue to serve as U.N. ambassador, and as a member of his national security team.

The trio of Senate Republicans had vowed to work to block Rice's nomination if Obama settled upon the United Nations ambassador as his nominee, stemming from her explanation for the Benghazi attacks. Rice had appeared on public affairs shows the weekend after the attack to assert that the assault -- which left four Americans dead, including Amb. Christopher Stevens – to assert that it was the outgrowth of a spontaneous rally to protest an American video that was offensive to Islam.

An investigation in subsequent weeks revealed that the attack in Benghazi was actually a coordinated terrorist attack, which prompted pointed questions from Republicans about why the administration had first put Rice forth to assert otherwise. Republican presidential nominee Mitt Romney tried for a series of weeks to effectively tarnish Obama politically with the mixed public explanation.

McCain, Ayotte and Graham pressed the matter further after the election, winning a meeting with Rice last month amid speculation that Obama wished to name the trusted adviser to fill the top diplomatic job.

"If Sen. McCain and Sen. Graham and others want to go after somebody, they should go after me," Obama said at a press conference following his re-election to rebuff the Republican troika. "And I'm happy to have that discussion with them. But for them to go after the U.N. ambassador who had nothing to do with Benghazi, and was simply making a presentation based on intelligence that she had received, and besmirch her reputation is outrageous."

But there were indications that the critiques had started to wear on the public perceptions of Rice. In the NBC/WSJ poll released Wednesday, Rice was rated positively by 20 percent of respondents, while 24 percent of said they had a negative perception of her.

It’s not just Benghazi anymore.

One of the most controversial energy projects in the nation also has become a flash point in the drama surrounding who may become the next secretary of state – and it’s coming from the left instead of the right.

Back on Nov. 28, “OnEarth,” published by the Natural Resources Defense Council, dug into U.N. Ambassador Susan Rice’s financial disclosures and found that she and her husband have a stake in TransCanada, the company pushing for the Keystone XL Pipeline to be built.

NRDC officials say it's an important issue that must be discussed during the nomination process. But the timing of the report raises questions, as it is being surfaced by an environmental activist community that has previously given support to another potential secretary of state candidate – Massachusetts Sen. John Kerry.

The decision on whether to approve the pipeline goes through the State Department.

“If confirmed by the Senate, one of Rice’s first duties likely would be consideration, and potentially approval, of the controversial mega-project,” Scott Dodd at “OnEarth” wrote. “Rice's financial holdings could raise questions about her status as a neutral decision maker.”

Dodd noted that “Rice owns stock valued between $300,000 and $600,000 in TransCanada, the company seeking a federal permit to transport tar sands crude 1,700 miles to refineries on the Texas Gulf Coast, crossing fragile Midwest ecosystems and the largest freshwater aquifer in North America.”

Bill McKibben, an anti-pipeline activist, told the publication: “It’s really amazing that they’re considering someone for Secretary of State who has millions invested in these companies. The State Department has been rife with collusion with the Canadian pipeline builders, and it’s really distressing to have any sense that that might continue to go on.”

Susan Casey-Lefkowitz, the NRDC's director of international programs, sounded a less strident tone a day later: "What's most important is that she rid herself of her holdings in TransCanada and other tar sands-related companies, and we're confident she will do that ... What's most important is that we have a good, thorough review done.”

Danielle Droitsch, a senior attorney for the NRDC and director of the Canada Project, told First Read: “We think Ambassador Rice has the credentials to be secretary of state, but if she were nominated, and then appointed, these holdings would have to be addressed.”

She added that “high-level officials dealing with Keystone should not have any conflicts of interest.”

The likelihood is that, if nominated, Rice will have to divest herself of her TransCanada investment to avoid a conflict of interest.

The environmental group’s effort to shed light on Rice’s financial interest in TransCanada could be just an attempt, if Rice is nominated, to get a “thorough review” and make sure it has a staunch ally in trying to thwart the project, as Casey-Lefkowitz said.

But could it also be a signal that the NRDC prefers another candidate for the job – Kerry, the other of the final two candidates reportedly being considered for the post?

After all, environmental groups have strongly supported Kerry in the past and have a long working relationship with him. Like they would for most Democrats in a presidential election, for example, the NRDC and the League of Conservation Voters, among others, ran ads in the 2004 election boosting Kerry.

LCV even endorsed Kerry before the New Hampshire Democratic primary that year, although it has notably not spoken out about Rice.

Droitsch, however, would not address whom the NRDC prefers for the job.

“We’re trying to signal that the pipeline decision has to be conflict-free,” Droitsch said. “That would pertain to any potential nominee. The president has the prerogative to nominate the person he believes is best for the position.”

The Senate will then raise questions, however, she said. And “now is important to raise the issue ... We want to make sure that anyone who’s being considered would be free of those conflicts. That’s our primary interest right now.”

The NRDC, which has been very involved in efforts to block Keystone, is the environmental interest group most pressing the issue of Rice’s financials.

But others might not be as keen to see Kerry leave Capitol Hill. After all, consider that green groups already spent a lot of money trying to oust Republican Scott Brown from the Senate – and were successful.

But if Kerry becomes secretary of state (or even defense secretary), his seat would become vacant, raising the potential for a costly and competitive special election.

“Who cares if the U.N. ambassador has a TransCanada stock. Who cares if the head of the FDA has TransCanada stock,” said a Democratic strategist and ally of the administration who is a veteran of confirmation battles.

“If she [Rice] were to be nominated, she would go through a process by which we look for financials conflicts. Maybe this stock would be identified as something that posed a conflict, and she would sell," the strategist said. "But she hasn't gone through that process, because she's not a nominee to anything. If they want to say that if she is the nominee, she should sell the stock, that's fine. But you can't legitimately hit her for having it now. And that is likely why NRDC backed off and no other environmental groups have piled-on.”

What really is going on here likely has less to do with Rice and whether she should ascend to secretary of state, and more with the NRDC leveraging pressure on the president and the administration to make sure the pipeline is rejected again once it comes up for approval. And that could be soon.

The next step in that approval phase, in fact, could come as early as next week, Droitsch said. TransCanada has applied for a shortened pipeline in hopes of having that approved – something the NRDC strongly opposes. A Supplemental Environmental Impact Statement could be released by the State Department as early as next week, Droitsch said.

“It is critically important for there to be independent decision-makers, free of conflict of interest, who can take an independent view,” she said.

She then tied the administration’s decision on the pipeline to climate change, an issue that has regained prominence as a result of Hurricane Sandy. In the days following Sandy’s landfall, in fact, New York Mayor Michael Bloomberg endorsed President Barack Obama for his leadership on climate change.

How Obama decides on the pipeline “signals where the U.S. is headed in terms of importing dirty fuels, inconsistent with an administration that is committed to fighting climate change,” Droitsch said.

“We’re confident President Obama understands the seriousness around the issues surrounding this pipeline. Approving it sends the wrong signal about our country’s commitment to climate change. Yes, he’s under a lot of pressure, but the public is very concerned about this. It’s not a decision I know he’ll view lightly.”

U.N. Ambassador Susan Rice rejected calls to arm the Syrian rebels on MSNBC's Andrea Mitchell Reports, arguing that would further inflame the region into a proxy war -- and that the Syrian opposition are not a united force.

Rice's comments came right after a Security Council briefing from former U.N. Secretary General Kofi Annan's team in Geneva, after their departure from Damascus.

Rice also accused Iran of aiding the regime's militias -- and talked about Russia's role.

"We think Iran is actively supporting its longtime ally Assad and providing material and other support," Rice said, "and indeed they said so publicly, in a statement on their own website. They bragged about their engagement in Syria and that is one of the reasons among others - they're not the only ones that are supporting the Syrian regime - that this is a conflict of a different character, with much broader regional implications should it continue to spin out of control."

Rice also said the U.S. continues to lobby Russia and noted its potentially pivotal role.

"We think the Russians have the greatest stake, in fact, in ensuring that the Syrian regime meets its obligations under the Annan plan, so that we're not having to resort to sanctions or having to see the region engulfed in a wider conflict," Rice said. "And that's the message that we're conveying to the Russians. It is their interest and indeed their responsibility as the Syrian government's best friend on the Security Council to put maximum pressure on the Syrian government to adhere to the commitments it's made. And that is why it's time that we start talking about this problem and thinking about this problem in these stark terms."

She added, "I think they are beginning to look at this situation with the kind of clarity it deserves, and recognizing that if they want to preserve Kofi Annan's mission - its opportunity to provide a peaceful political solution, which is what they say they do - either they're going to have to move Assad to a very different place than he's been in thus far, or join with us and others in maximizing Security Council pressure on the regime."

Here's a partial transcript:

AVOIDING A "PROXY WAR"

ANDREA MITCHELL: What has to happen on the ground for the administration to decide that there needs to be weapons and material support to the opposition?

RICE: Our view has been that the best way to resolve this is not by intensifying the militarization, not by providing further arms into what is already a hot conflict - but to try to resolve it through non-military means, through a diplomatic and political process. Now as I said that may prove ultimately not to be possible. We haven't reached that point yet - and for this to become a proxy war with countries all over the region and beyond funneling weapons in there is basically conceding a massive fire burning in that region. For those who are advocating arming the opposition, they really ought to consider the consequences of that approach and also to ask, frankly, who are they arming inside of the Syrian opposition. You know and we know, it's not a unified opposition. It's fragmented. They don't have common command and control. There are some extremist elements mixed in there, and we know much less about the intentions of the Syrian opposition than we did even of the Libyan opposition at the time. And I want to remind you that we did not arm the Libyan opposition.

RE IRAN BRAGGING ABOUT HELPING REGIME FORCES:
AM: Let me ask you about some of these outside forces. What is the role of Iran in all of this?

SR: We think Iran is actively supporting its longtime ally Assad and providing material and other support - and indeed they said so publicly, in a statement on their own website. They bragged about their engagement in Syria and that is one of the reasons among others - they're not the only ones that are supporting the Syrian regime - that this is a conflict of a different character, with much broader regional implications should it continue to spin out of control.

RUSSIA'S ROLE

AM: And what makes us think that Vladimir Putin, who wouldn't even come to the NATO Summit meeting, and has shown no friendliness toward the Obama administration - what makes us think that Vladimir Putin is now going to be helpful in pressuring his political ally Assad to give up power?

RICE: Let's be clear. The relationship broadly speaking between the United States and Russia over the course of the last several years is much improved over the past. There are areas in which we have real differences, but this improvement - this reset as we call it - has occurred with Vladimir Putin with prime minister - and we expect it will continue. But on this issue we disagree and we are continuing to talk with the Russians and pressure them. We'd like to see them make a voluntary decision to stop providing military support - even of prior agreed contracts to the Syrian regime. We think the Russians have the greatest stake in fact in ensuring that the Syrian regime meets its obligations under the Annan plan so that we're not having to resort to sanctions or having to see the region engulfed in a wider conflict. And that's the message that we're conveying to the Russians. It is their interest and indeed their responsibility as the Syrian government's best friend on the Security Council to put maximum pressure on the Syrian government to adhere to the commitments it's made. And that is why it's time that we start talking about this problem and thinking about this problem in these stark terms...

AM: Did you see any flexibility on Russia's part in the meeting today? 

SR: We'll see where the Russians end up. I think they are beginning to look at this situation with the kind of clarity it deserves, and recognizing that if they want to preserve Kofi Annan's mission - its opportunity to provide a peaceful political solution, which is what they say they do - either they're going to have to move Assad to a very different place than he's been in thus far, or join with us and others in maximizing Security Council pressure on the regime.