This is a rush transcript from "Hannity & Colmes," March 21, 2008. This copy may not be in its final form and may be updated.

SEAN HANNITY, CO-HOST: We get right to our top story tonight and it is the candidacy of Senator John McCain, who was once left for dead in the Republican Party. But the latest polls this week now give Senator John McCain a national lead over both Hillary Clinton and Barack Obama.

Joining us now, one of Senator McCain's supporters and, boy, did he come down hard on me, former vice presidential nominee Jack Kemp. Jack, welcome back.

JACK KEMP, FMR VICE PRESIDENTIAL NOMINEE: Professor Hannity, Professor Estrich, nice to be with you.

SUSAN ESTRICH, GUEST CO-HOST: Nice to have you.

HANNITY: We're in good. All right, here's the latest Rasmussen poll: McCain 51, Clinton 41; McCain 49, Obama 42.

KEMP: It really doesn't mean much right now, although it shows a surge for McCain and as you pointed out, he had that near political death experience back last summer. But polls tell you what people think today. They don't tell you what people will think tomorrow with new information. And the purpose, I believe, of a campaign, particularly with John, is to keep giving people information so that he will eventually beat either Hillary Clinton or Barack Obama.

HANNITY: I thought we got a lot out of him out of the interview that I had with him. He's going to keep...

KEMP: I watched it.

HANNITY: He's going to keep on issues on gay marriage and the abortion plank he's going to keep in the platform. He's going to eliminate earmarks. He's going to make the Bush tax cuts permanent. He's going to win the war in Iraq. I have been very open in pointing out my differences, but there are a lot of areas we agree.

KEMP: Well, I was on your show when you were pointing out more of the differences.

HANNITY: Yeah, you were beating me up pretty hard.

KEMP: Well, look. John, you can have your arguments with him. He is a bulldog. He is a maverick. I pointed out in that article that you read one time on your radio show, he was Winston Churchill-like in many ways. Churchill was not liked by the Tory Party. He left the Tory Party for the Liberal Party in 1904 because of free trade. John believes in free trade. He believes in a victory in the war on terrorism. He wants lower tax rates on labor and capital and the factors of production and he is pro-life, and I think he's going to make a good candidate. Go ahead.

HANNITY: No, I think having you on his economic team is good because there's nobody that understands supply side economics than Jack Kemp. Now, I want to ask you one question...

KEMP: Steve Forbes. OK.

HANNITY: I want to ask you a question. We have this controversy with the Reverend Wright, the Reverend Meeks. We had the speech by Barack Obama earlier in this week. And then Barack Obama goes, as we pointed out on last night's program, goes on the radio and I want to roll this tape when he used the phrase, talking about his grandmother, she is a typical white person.

(BEGIN AUDIO CLIP)

BARACK OBAMA: The point I was making was not that my grandmother harbors any racial animosity. She doesn't. But she is a typical white person who, you know, if she sees somebody on the street that she doesn't know, you know, there is a reaction that's been bred into our experiences that don't go away and that sometimes come out in the wrong way.

(END AUDIO CLIP)

HANNITY: Now, I want to ask you this question: In the light of our — the first time I brought up the issue of Reverend Wright to you, now, in fairness to you, you had not heard — you were not following the story as closely as I had been since march of '07, and you used the words on this program: "I don't believe in guilt by association." And now that you've had the opportunity to see the tapes, now that I have explained the weather underground to you, now that you hear the words that he just uttered there, "she is just a typical white person," what has this done in your thinking process?

KEMP: Well, I still don't believe in guilt by association. I don't blame Bill Buckley for defending Joe McCarthy. I think we all have to be very careful. This is a very sensitive issue. I think he gave a wonderful speech. There is a disconnect in that speech. Comparing his grandmother to Reverend Wright, I think was over the top. But he said something I really liked. He said: no country in the world could my story be told as it is being told today. That is a beautiful testimony to our country and he should get credit for that.

So, do I disagree with his statement about all white people believe in stereotypes? No, I don't agree with him. But, I cut some slack here, because I think he is in a very tough spot politically and I don't want to see him lose because of a pastor in Chicago who is way over the top accusing the United States of jailing Nelson Mandela. I mean, give me a break.

ESTRICH: Jack, it's Susan. Welcome, by the way.

KEMP: Hi, Susan. Thank you.

ESTRICH: A lot of conservatives I'm hearing from now are saying that while three weeks ago they were sort of quietly rooting for Hillary because they thought Obama was going to be tougher to beat, now they are sort of drooling for Obama. Is that fair? Is that right? They think this stuff is so powerful that they can use it to beat him?

KEMP: Well, I think he has got a real problem, as Sean pointed out, with the remarks of Pastor Wright at the Chicago church. But, you know, Susan, I don't like the idea — I'm out of step, I guess, with most conservatives...

ESTRICH: That's why I like you.

KEMP: You should get behind the man or woman of your choice and stick with him and don't vote for someone else thinking you can jiggle the electoral map and figure out who is the easiest to beat, because I'll tell you what: Both Hillary and Barack Obama will be tough. I think John McCain could win, but I think calling for Republicans to go vote for Hillary to — I don't agree with Rush Limbaugh. I don't like that. I think you should vote for the man or woman of your choice and stand behind them, defend them and work for the best. I've always believed that.

ESTRICH: Well, you've always been a person of great integrity, even from the perspective of those of us on the other side of the aisle, for which we have great respect.

Let me ask you about the conservative problem McCain has had. Has he put the rest his problem with the — you know, Sean is pointing at himself, right now, and he is right. Has he put to rest this problem with Sean Hannity, with Rush Limbaugh, with Laura Ingraham? I mean, I've always kind of liked John McCain and I remember at the last convention I was all set to go to his party and these people guys from FOX News were like, "You're going to John McCain's party?" It's typical. I mean, he's a Republican Democrats like, but what about Republicans?

KEMP: Well, I think, Sean put it best when he said that that hour-long interview John McCain did with Sean Hannity, the endorsement of the president, his trip to the Middle East, his fidelity to conservative values and some rather progressive ideas, I think, on immigration, Sean and I disagree over that, I think we need a comprehensive immigration reform. Sean wants to reform the tax code. I mean, John wants to reform the tax code.

HANNITY: I do, too.

KEMP: Yeah. He wants to make NAFTA permanent, not renegotiate it like Barack and Hillary. He believes in free trade. I believe in free trade. And he's got conservative values vertically, horizontally I...

(CROSSTALK)

HANNITY: One thing — I'm stealing a second of Susan's time.

ESTRICH: And I'm letting him.

HANNITY: But, I fully expect when I vote for him, that I'm going to be a fierce opponent of his based on track record and based on some of the answers he gave me 35 percent of the time. But, I don't agree with Hillary or Barack Obama two percent of the time, so — and I think he's great on the war, which is the defining issue of this generation.

KEMP: Fair enough. I think he's right on the economy, he's right on social issues, right on the war, so I'm with him 98 percent. I disagreed with his vote against the capital gains tax cut. I think that was a big mistake. But, I think you'll see in the coming days and weeks he's going to get right on the supply side of the economy with me and Phil Graham and Steve Forbes.

ESTRICH: All right. More with Jack Kemp after the break.

(COMMERCIAL BREAK)

ESTRICH: We now continue with former vice presidential nominee, and great friend of ours, Jack Kemp.

Jack, let me ask you this. If John McCain makes nice with the conservatives, like Sean and Rush, etc., will that cost him with the independent voters who have been attracted to him in the past precisely because — for all the reasons these guys didn't like him?

KEMP: He is the only Republican who, in the debate over immigration, reminded the American people that both legal and illegal immigrants are still God's children. He gained a lot of support from many in the middle and the middle right, perhaps, who believe that we need a comprehensive solution and guest-worker program to stop the flow of illegal immigration. I know Sean disagrees with me, but I believe that from the bottom of my heart. So, I think he has made steps to win over conservatives, but he's still got that independent streak, maverick streak, if you will, that can win Reagan Democrats and independents, in my opinion.

ESTRICH: What about the age issue? The first thing people say to me when I mention the word "John McCain," my students — I did a little game with. I said, OK, let's free associate, John McCain and half the room yelled out "old."

KEMP: You've got to make light of it. He's got to do what Ronny Reagan did when Reagan said he's going to prove that he can compete in any race with Mondale, he's going to compete and prove his youth by campaigning in all 13 of our states. I mean, things like that can turn to his advantage.

He's vigorous, he's healthy, he can outrun me by many miles. I think he's going to prove himself to be a very adequate campaigner and get a younger, maybe governor or senator — I think it won't be a problem for John McCain.

ESTRICH: Do you have any ideas who would be the ideal person?

KEMP: No, no. There's a lot of good men and women in our party.

ESTRICH: And what about, and then I'll leave this over to Sean, what about the fear I've heard from some Republicans that if he has a "senior moment," that is if he has a moment like you and Sean and I probably have every now and again...

HANNITY: I have enough of those.

ESTRICH: I have them all the time, where I just can't remember what day it is and where I am going. But if that happens to John McCain, you and I both know the press will be all over him with the "Is he too old?" issue. How do you avoid that?

KEMP: I think he is in mid-youth. He's a vigorous 71 years of age, and as I said, I can't keep up with him. So, I think he's closer to 60 than to 70. And I think he'll prove himself in this campaign as he did in the primary.

HANNITY: When I interviewed him, he was in the middle of a very heavy schedule and I thought he was holding up very well, Jack. I want to go back to your comments about Reverend Wright.

KEMP: (LAUGHING) OK.

HANNITY: This is very important here though. I don't know if I should call you quarterback or congressman, I never know what to say. But, sir.

KEMP: Recovering politician.

HANNITY: OK, there you go. But here's what's important, this comes down to — and you seem willing to give Barack Obama a pass that I'm not willing to give him and let me explain this. This was his pastor for 20 years; the most incendiary anti-American language you would ever hear from the pulpit. He claims that he didn't know, but that he did know, but then he disinvited him to the invocation when he was announcing he was running for president here. Jack, I don't believe him, No. 1, and secondly, I question the judgment of this man.

KEMP: He denounced the racism, he denounced the anti-Israel statements of Reverend Wright, he denounced the off-the-wall belief that America is the worst killing machine...

HANNITY: He sat there for 20 years. Are you really...

(CROSSTALK)

KEMP: I don't believe he — the Wall Street Journal, not soft on liberals editorial, said they don't for a minute think he believes any of that stuff. So look...

HANNITY: No, no, no. That's not the question. Was he — he's saying he didn't know. Now, this church — his pastor went to Tripoli with Louis Farrakhan. Jack, this is important — that they gave him the lifetime achievement award and said Farrakhan epitomized greatness and he didn't know any of this?

KEMP: Barack didn't do that. Barack didn't do that.

HANNITY: Yeah, but his church did. He didn't know his pastor was like that?

KEMP: Sean, I can't do that every night with you. I mean, you and I disagree on this. I think he's denounced it. I disagree with so many of his positions. For instance, he said he blamed the lack of economic opportunity that young black men and women have. You know what? I agree with him. We have not done enough to democratize our capitalistic system to make more capital available to start businesses. He wants to raise tax rates on capital gains, dividends, income tax by 52 percent. He's going to squeeze, not me, I'm already wealthy at 72. He's going to squeeze the young black entrepreneur. He's hurting...

HANNITY: Well, let's say — let's go down this road because this is important and I know I'm pressing you a little...

KEMP: I don't want to stay on ad hominem arguments.

HANNITY: No, I don't want an ad hominem argument, here, but I find it — I'll use the term that Hillary Clinton used about General Petraeus. This, for me, is the willing suspension of disbelief and what I mean by this is, if he really didn't know his pastor had these associations with Farrakhan. He went to this church for 20 years, he didn't know his pastor was saying these controversial things, as he would have us believe, we discovered and broke the story last night, that he's friends with another pastor who has used the n-word repeatedly and talked about the mayor of Chicago as a slave master. It's very — I'm very hard-pressed to think that maybe he may have some agreement with this, which is a scary scenario for a president.

KEMP: I don't think he does. He's in a tight spot because he's to answer this again and again and again, particularly in the general. Having said that, I told you on your radio show last week that I hoped that if he is defeated it's on the basis of bad economic policy, raising taxes, raising white flag to our enemy in the Middle East and things like that, not what Pastor Wright has said.

HANNITY: I think you have taken on the role of the external conscience of Sean Hannity, because boy, you've been after me a lot lately.

ESTRICH: He's a good guy.

KEMP: I'm not after you. I'm a fan of yours, but I'm not going to hold you accountable.

HANNITY: I am accountable. I know my facts. But anyway, good to see you.

KEMP: You do. Susan, thank you.

ESTRICH: Thank you.

HANNITY: Former congressman and quarterback, Jack Kemp.

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