This is a rush transcript from "Your World with Neil Cavuto," November 6, 2007. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST: And this FOX News Alert for you: New York Governor Spitzer could be paying at the polls with the issue he pushed on voters, driver's licenses for illegals.

Early indications are, it may driving some voters away from Democrats in the state. It is not much more popular nationally, I got to tell you. Close to eight out of 10 Americans polled by The Washington Times says it is just a bad idea. Seven out of 10 Democrats feel the same way, but not this guy. He is all for it.

With us now, New York State Senator Eric Schneiderman.

Senator, most folks don't like this. Politicians keep pushing this. What is the deal?

ERIC SCHNEIDERMAN (D), NEW YORK STATE SENATOR: Well, there's a — sort of a disconnect here between what people will say when you ask them should undocumented or illegal immigrants be able to get licenses and what people will say if you say, do you want everyone who is driving in your town to have a license, so they can get insurance?

And the difficulty here is that the local governments, state governments around the country, are grappling with the fact that we have 13 million undocumented immigrants here. They are not going home. We have to deal with them. The federal government has screwed up immigration policy. They have brought — they have allowed people in here. And now the state and local governments have to deal with the consequences.

CAVUTO: Yes, but you know what, Senator? What a lot these folks don't like is the fact that you are not listening to what they don't like. They recognize the fact that, if you are an American, you should be entitled to get a license.

But they also realize that, if you are not, you are not entitled to it, and that, when you start opening the doors to licenses that can give you the leeway to buy everything from guns to God knows what else, you are on a slippery slope, and you politicians are not hearing them.

SCHNEIDERMAN: Well, no, I think — I think the opposite.

I think that there are — there are two kinds of politicians. There are people who are basically lying to the American people, saying, if you are mean to these folks, they are going to go home. And then there's people who, like Governor Spitzer, who is grappling with this — and I don't agree with the governor's policy, the specifics of it, but he and Mayor Bloomberg in New York and other people around the country are grappling with the fact that they are here.

We need to have them able to go to the cops. We need to have them able to buy auto insurance.

CAVUTO: No, no, you are saying — you are equating, by not granting them these rights, Senator, we're somehow being mean, and that the way we compensate for it is to try to be nice.

SCHNEIDERMAN: No, it's not nice.

(CROSSTALK)

CAVUTO: No, no, no. You are equating a right given and a freedom given to American citizens should be awarded to illegals simply because they are here and they are not going anywhere.

What is next? If you have broken into my home, and you are sitting in my couch, I give you some popcorn, too?

SCHNEIDERMAN: Neil, I think that is — that is sort of — that is a very, very dangerous argument to make.

Automobile safety is a matter for all of us. I don't want them to have licenses for their sake. I want them to have licenses for my sake. If someone runs into my car, I want them to have a license. If someone is driving on the roads, I want them to take a test. I want to know where they live. And I want them to be able to buy insurance.

(CROSSTALK)

CAVUTO: No, no, no, wait a minute, Senator.

(CROSSTALK)

CAVUTO: You are saying that, under this system, their insurance is going to cover you, even though they're illegally here...

SCHNEIDERMAN: Absolutely.

CAVUTO: ... and that, under this system, if someone bangs into you or your spouse or your kid, under this system, that illegal, who would never own up to being illegal, is going to say, don't worry, I have got insurance, everything is fine? And you accept that, endorse that, believe that?

SCHNEIDERMAN: In fact, Neil, we had 150,000 undocumented immigrants who had New York State driver's licenses who simply want to renew.

The Pataki administration changed the policy. You know, there are seven other states that currently and for a long time have given licenses to undocumented.

(CROSSTALK)

CAVUTO: No, no, no, Senator...

(CROSSTALK)

SCHNEIDERMAN: They have insurance.

(CROSSTALK)

CAVUTO: But, Senator, you are not seeing my point or the view reflected by a lot of Americans who step back and get away from the complications of this argument and say, first of all, you're illegal. Secondly, you shouldn't be here. Thirdly, I am not going to endorse the fact that you are here by granting some paper legitimate right to your being here.

Now, seven out of 10 Americans feel that way. Close to the same number of Democrats feel that way. Does Custer ring a bell to you?

SCHNEIDERMAN: Well, I think it's more like the civil rights movement in the '40s, when 77 percent of the people thought segregation was OK. I think this is a problem we're going to deal with.

(CROSSTALK)

CAVUTO: No, no, wait a minute. You're equating those who are here illegally to those Americans who struggled for rights, born Americans? You are creating that struggle then with this illegality now?

SCHNEIDERMAN: It's — there are 13 million people. We have to deal with them.

CAVUTO: Senator, all right, all right.

SCHNEIDERMAN: Do you want to pretend they're going — do you think they are going home? What is the answer?

(CROSSTALK)

CAVUTO: No, no, you have got to start...

SCHNEIDERMAN: What is the answer? What is the answer?

CAVUTO: ... looking at the mood the American people, who are saying, whether they are going home or not isn't the question. But giving them a driver's license to make sure they do is.

SCHNEIDERMAN: Well, that is easy for you to say. But those of us who work on state and government, we have to deal with public safety.

CAVUTO: All right, Senator...

SCHNEIDERMAN: Automobiles are a matter of public safety, Neil. And states...

CAVUTO: OK.

SCHNEIDERMAN: ... have to have the freedom to work it out.

CAVUTO: Senator, spin it around, but you have got to look at those polls. You have got to look at the outrage, and you have got to look at the sentiment of a lot of folks, who just say, this is getting ridiculous.

SCHNEIDERMAN: Well, help us get the word out and let's have a discussion, Neil.

CAVUTO: All right, Senator, thank you very much.

SCHNEIDERMAN: Thank you.

CAVUTO: All right.

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