This is a rush transcript of "Special Report With Brit Hume" from November 21, 2007. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

SHINYA YAMANAKA, KYOTO UNIVERSITY PROFESSOR: We're creating the equivalence of an embryonic stem cell directly from the patient's ordinary skin. Now that we know this possible, we are now facing the chances of solving rejective responses of the body as well as ethical issues.

(END VIDEO CLIP)

BRIT HUME, HOST: That was a Shinya Yamanaka, a professor at Kyoto University announcing that there is a new process using human skin cells that creates something very close to embryonic stem cells, which have been noted by innumerable scientists to have tremendous potential for analyzing and curing diseases.

Of course, embryonic stem cells have also been the subject of an enormously long-running debate over the ethics of using them.

Some thoughts on all this now from Fred Barnes, Executive Editor of "The Weekly Standard," Juan Williams, Senior Correspondent of National Public Radio, and the syndicated columnist Charles Krauthammer, Fox News contributors all.

So, Charles, what is the significance of this discovery announced by the professor at the University of Kyoto?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: This is one of the great discoveries of the last half century. This is the holy grail of stem cell research, and the reason is that it is so elegant and simple.

And that's why the old technique, the one that has the arguments about the use and destruction of embryos, the one that has been held up because of that, it will become rapidly obsolete.

And the reason is under the old technique, it was very complicated. You had to get eggs out of a woman, which you had to induce her with hormones. You had to have a surgical procedure to remove eggs — not dangerous but complicated, expensive.

Then you have to remove the nucleus of that egg, take a stem cell, take a skin cell from someone, inject the nucleus. You grow a small embryo, you detach stem cells, and you grow it — very complicated.

Here, what you do is you take a skin cell, you inject four genes, and it becomes presto, by magic, an embryonic stem cell, which can become skin or bone or liver or brain, or anything. It's truly a miraculous discovery.

And the irony is that the research this research was undertaken, part of it is, and the researchers in Wisconsin who collaborated on this and who did an independent study, were funded by the Bush administration's National Institutes of Health.

Funding the research, because the president imposed an ethical constraint on embryonic stem cell research —

HUME: And then paid for these guys to go out and look for alternatives.

KRAUTHAMMER: Which ended up being not only more ethical, but more elegant, and simple, and reliable. And it's going to be the new wave, and the old issue will be abolished. That ethical debate will be a moot issue in a couple of years.

HUME: Juan, does it look like this whole fight over embryonic stem cells is over for now, or not yet over?

JUAN WILLIAMS, NATIONAL PUBLIC RADIO: It's not over. I mean, I have a different take from reading. Obvious, I'm not Mr. Science, like Charles is, here, as a doctor.

But I must say in reading the stories today, we have here a quote from Dr. Story Landis, who is the Head of the National Institutes of Health Stem Cell Task Force, in which he says that the breakthrough with mature cells was possible in part of because of earlier work with embryonic cells, and this does not obviate the need for human embryonic stem cell research.

And he makes the point, also, that, clearly, we have been set back because of limits in federal funding for embryonic stem cell research. We have not advanced as quickly as we might have if the government had been investing all along in this.

So I think it comes down to a wonderful breakthrough. I don't know if it is the greatest breakthrough of the last half century, I will trust Charles. But I will say this, that is sidesteps the ethical issue in a way that is convenient for lots of people who were nervous about it.

HUME: More than sidesteps, it kind of overcomes it.

WILLIAMS: Hopefully it overcomes it. We don't know that, yet. But it sidesteps it for the moment, because what it says is that there are other ways to achieve that end.

FRED BARNES, EXECUTIVE EDITOR, WEEKLY STANDARD: And it also says there are other ways that are easier, and there are other ways where the result is a more versatile stem cell. It can be used in many more ways, is the way I understand it, than an embryonic stem cell does.

HUME: Now the argument, just to familiarize people who may not remember, about embryonic stem cells was that you had to take a human embryo and, in effect, destroy it —

BARNES: You kill it, sure.

HUME: You kill it. And that raised —

BARNES: It was morally objectionable to a lot of people, including myself. And if you can get around that and you don't have to do that, then I think you are ahead of the game.

President Bush was called "anti-science," remember that? He was called "anti-science" because he said let's try this other track.

Remember, he funded a number of lines of embryonic stem cells. He didn't want to expand the funding into the future, but it was more than anybody else had funded it. And now this comes along.

HUME: As a result of research that his government supported?

BARNES: Yes.

And, remember, Congress barred — was asked to fund research into this alternative embryonic stem cell research, and Congress voted it down.

The people who were doing this with embryonic stem cells are not going to want to give it up. There being funded for that. This is what they have been pursuing as scientists, and it is going to be hard for them to accept the fact that they've been leap-frogged here.

And, secondly, if you say that it's morally objectionable to kill these embryos, you're also saying abortion is morally objectionable.

HUME: You think that is at the root of this?

BARNES: I think that is at the root of this.

KRAUTHAMMER: It ended up as a surrogate debate about abortion. I was on the president's council of bioethics, and we felt as if we were simply re-treading in a different forum the abortion debate, which made it intractable. But the reason all of this, I think, is going to go away is because there are a thousand labs today that could start on this new technique because it's so simple. There aren't a lot that could do the old technique, which involves all those complicated steps.

So if you're a research lab, they will be jumping in now to try to reproduce this. And I think it will yield the results which will be really salutary.

HUME: Next up with the panel, will Democrat Barack Obama's honesty about his partially misspent youth hurt or help his presidential campaign? We'll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENTIAL CANDIDATE: I made some bad decisions when (INAUDIBLE). There were times when I got into drinking. I experimented with drugs.

RUDY GIULIANI, PRESIDENTIAL CANDIDATE: I respect his honesty in doing that.

MITT ROMNEY, PRESIDENTIAL CANDIDATE: It's just not a good idea for people running for president of the United States who will potentially be the role model for a lot of people to talk about their personal failings when they were kids.

(END VIDEO CLIP)

HUME: That's two distinctly different views of what Barack Obama had to say about himself. Barack Obama has written in the past in an earlier book about his, as I said before, partially misspent youth — and this book "Dreams from my Father."

But now he is talking about it again with just a few weeks to go to the Iowa caucus. The question raised is here is this a good idea or not? Rudy Giuliani thought it was good. Mitt Romney thought not.

What do you think, Juan?

WILLIAMS: To me, of course, this is all politics. And you think Rudy Giuliani has his own skeletons in his own closet, and Mitt Romney seems to want to hold himself up as Mr. Values. But the fact is people make mistakes people and move on. To reveal human failings is not somehow — makes him somehow a role model for bad behavior. To the contrary, I think it says to young people, you know what, look at what this man has overcome. Look at how you move on, and you grow in life, and you succeed.

BARNES: Obama is a Christian, and it is a little like a Christian testimony. I'm sure he has given one. I was terrible, I drank, I took drugs, and everything. And then I found Christ and my life is different, and I went on to succeed in life.

HUME: What about the idea that it may say to people, look you can screw around and screw up all you want when you're young. Don't worry about it because you can recover and get on the right track?

BARNES: I don't think that's what he said. I don't think that's what he meant. I don't think that's what anybody is —

HUME: He also didn't mention — although it is true that he is a Christian, he didn't put it in that context either.

BARNES: Not in that bite. But I thought that was perfectly all right, what he said, so I vote for Giuliani's interpretation.

KRAUTHAMMER: I think what he said was I drank, and I smoked, and I goofed of, and then I discovered Iowa, and now I'm redeeming myself.

What was wrong here was the setting. If you put it in your book, that's fine. If you're talking to high school students — if the high school student is reasonably intelligent, he's going to look at this, and he is going to say the guy smoked, he drank, he did a little bit of blow, and here he is running for the president of the United States. You, too, can grow up to be president of the United States if you do all this bad stuff.

It's not a big deal, and I thought Romney was a little bit sanctimonious, a goody-two-shoes, in talking about all of this. Giuliani, of course, has his own, as you say, skeletons in the closet, so of course he wants full disclosure on everybody and essential amnesty on all of this past stuff.

But, in the end, I think Giuliani is right. It is OK to say what happened. But you probably ought not to do it in a high school gymnasium.

BARNES: The other thing is you probably ought not to do it if you are running for president if you want to help your campaign. I suspect that most of the voters in Iowa and other places have not read his book "Dreams of my Father" where he goes into this. This should be the first time they have heard it and may not like it — adults, I'm talking about.

WILLIAMS: I think for kids — look, high school kids, believe me, they know about drinking and drugs, and sex OK. Let's not play that game.

But I do think it's odd at this moment. So the question arises is why is he doing it now? And I come back to this thing that we might have discussed earlier in week about Bob Novak and dirt on the Hillary campaign, having dirt on Obama —

HUME: Do you think that might be an inoculation?

WILLIAMS: I don't know.

BARNES: How could that be some secret?

HUME: I know, but there might be details. Who knows.

BARNES: Could be.

KRAUTHAMMER: If you have to choose between a motive that is calculation and the other was a slip, I would go with slip.

WILLIAMS: Let's hope. And also let's hope that he really cares about those kids, and was suggesting to them, you know what —

HUME: In the meantime, it must be said, his campaign is doing roaringly well in Iowa. We had David Yepsen, who we all know and like and respect as the Dean of the Political Reporters in the state of Iowa, saying that he has perhaps the best organization out there. My sense is that he's in an updraft.

WILLIAMS: He is in an updraft in Iowa.

His organization is not matched nationally, not comparable to what Hillary has nationally. But if he is able to win there, I think he gets a lot of tailwind, updraft, as you put it, going towards New Hampshire. And then you never know what happens.

HUME: New Hampshire, we now know, will only be five days. And you can argue that — it will be the third and the eighth. You can argue that flat around I suppose, Fred, in the sense that it may allow for the maximum effect, or maybe not, of the tailwind you get out of Iowa if you win.

BARNES: It helps the winner. It helps whoever is the big story coming out of Iowa.

HUME: Somebody being in a surprise second, you mean?

BARNES: Mike Huckabee being a surprise second.

HUME: He may not a surprise second anymore.

BARNES: OK, he will still be a surprise second to me.

HUME: So what about that? So Obama benefits from the tightness of the schedule?

KRAUTHAMMER: Anybody who wins in Iowa benefits because it magnifies the slingshot effect. A compression of that time scale will have a huge effect, because you're riding that wave and it can't be undone.

HUME: There's a lot of Iowa winners who have come to grief in New Hampshire.

KRAUTHAMMER: It has been a longer interval. A shorter interval is —

HUME: I remember I covered George Bush 41. I picked him up out of Iowa, rode with him into New Hampshire, where he promptly lost, and went on a losing streak, and the airplanes got cheaper, and the accommodations got worse and worse.

BARNES: The thing that ought to worry Obama is, remember who had the best organization statewide in Iowa in 1993 going into the last Iowa caucuses?

HUME: Howard Dean.

BARNES: Howard Dean.

HUME: I knew, Fred, you'd bring that up for old times.

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