The following is a partial transcript of the May 25, 2008, edition of "FOX News Sunday With Chris Wallace":

"FOX NEWS SUNDAY" HOST CHRIS WALLACE: Joining us now, the chairman of Hillary Clinton's campaign, Terry McAuliffe.

And welcome back to "FOX News Sunday."

MCAULIFFE: Great to be here, Chris.

WALLACE: Before we get to the rules fight, I want to ask you about Senator Clinton's comment Friday about staying in the Democratic race. Here it is.

(BEGIN VIDEO CLIP)

CLINTON: My husband did not wrap up the nomination in 1992 until he won the California primary somewhere in the middle of June, right?

We all remember Bobby Kennedy was assassinated in June in California. You know, I just — I don't understand it.

(END VIDEO CLIP)

WALLACE: Why would she make any mention of assassination in the midst of a campaign?

MCAULIFFE: Well, what she was talking about was the time line. Everyone has told her to get out of the race. She has said, "I'm not getting out of the race, nor should I get out of the race," and she was referring to the time line, how these events have gone into June.

It's happened in the past. I mean, she had made a very similar statement, as you know, in Time Magazine in March. Nobody said anything about it. It's unfortunate. The people on the editorial board didn't misinterpret it at all. Robert F. Kennedy Junior issued a statement. He didn't misinterpret it at all.

But it's unfortunate. A hyped-up press over Memorial Day weekend — the Obama campaign inflaming it, tried to take these words out of context. She was making a point merely about the time line.

WALLACE: When you say the Obama campaign inflamed it, their comment was it's unfortunate. Senator Obama yesterday on the plane said, "I'm going to take her at her word." How did they inflame it?

MCAULIFFE: Yeah, that's great, but Friday they were all part of this process. The press secretary came out and attacked Senator Clinton and got it going so the story would be around for three days.

It's nice to get a story going and then, you know, let it go for three days over the weekend and say, "Oh, she didn't mean anything about it."

I mean, we've got to remember we have to, Chris, pull this party together. Both of these candidates have received over 17 million votes. Actually, more people have voted for Hillary than any candidate running for the nomination on either political party. We need to remember that.

When this process is over, and I think it will be over shortly, we all have to come together. And people just need to settle down. Let's let the primaries continue over the course of the next week and a half.

WALLACE: Does Senator Clinton understand how tasteless, even how ghoulish, it is to even use the word "assassination," especially when there have been concerns about Senator Obama's safety?

MCAULIFFE: Well, first of all, this was about — all about Hillary Clinton and the reasons why she was in this race and the time line.

WALLACE: She could have just said 1968 and Bobby Kennedy.

MCAULIFFE: Sure, she could have.

WALLACE: She didn't have to say "assassination."

MCAULIFFE: Yeah. And as she said, "If anyone took offense to what I had said, then I apologize for it." Sure, I agree.

WALLACE: Does she understand how tasteless and ghoulish it is to use that word?

MCAULIFFE: She was merely talking about the time line. She understands if it offended people. She apologized for that. But let's remember — let's keep this in context.

We've been in this race for 17 months. We've been out there. What the voters want us to focus on is health care, education, oil prices. Those are the issues that people are focused on, Chris, and that's what this campaign ought to be about.

We need to be very careful at the end of this process now that we have got to bring us together. We have a very important election on November 4th.

WALLACE: Let's examine — you talk about her apology. Let's examine her effort at damage control later that same day, Friday.

MCAULIFFE: Sure.

(BEGIN VIDEO CLIP)

CLINTON: The Kennedys have been much on my mind the last days because of Senator Kennedy, and I, you know, regret that if my referencing that moment of trauma for our entire nation, and particularly for the Kennedy family, was in any way offensive, I certainly had no intention of that whatsoever.

(END VIDEO CLIP)

WALLACE: First of all, forgive me, that's one of those classic Washington non-apology apologies — I regret if my referencing was offensive. Question: Does she think it was offensive and was she flat-out apologizing?

MCAULIFFE: At the time she said it, she was merely talking about a time line of how these events go into June, and she said, "If anyone found offense to it, I apologize." She said that on Friday when it first came out. But it's interesting, as I say.

WALLACE: But she didn't say, "I apologize." She said, "I regret if anyone found it offensive."

MCAULIFFE: Regret, apologize — you and I could sit here and parse words all morning. The bottom line is she was talking about a time line. This event is going into June, obviously. We have some very important contests in June. And that's what she was referring to.

WALLACE: If she was apologizing, who was she apologizing to?

MCAULIFFE: Probably members of the Kennedy family, anyone who would have taken offense. But immediately, Robert F. Kennedy Junior, Senator Kennedy's son, went out and said, "I did not misinterpret it, I did not misjudge it, and no one else should."

So if Robert F. Kennedy Junior doesn't find offense to it, why is it that everybody else should? They shouldn't. They ought to take Robert F. Kennedy Junior — he did not misinterpret it or misjudge it.

WALLACE: Does she apologize to the Obamas?

MCAULIFFE: Let's be clear. This had nothing to with Senator Obama or his campaign. It was about Hillary Clinton staying in the race. And the reason she's staying in the race, Chris — let's be very clear — she has now received more votes than Senator Obama of all the people who have gone and voted.

We have just come off a big win in Kentucky, 35 points, 41 points in West Virginia. She is winning races. That's why she's staying in this.

And she's fighting for all those people who have supported her, for all the women who want to see the first woman president of the United States of America, all the people who have come up to Hillary Clinton, who have talked about how their lives have been affected, want her in that office to change their lives for the better.

WALLACE: I want to ask you a couple of questions and then I'm going to get off this.

MCAULIFFE: OK.

WALLACE: When Governor Huckabee made a bad joke at the NRA about someone pointing a gun at Obama, he immediately apologized and he personally called Obama to say he was sorry. Has Senator Clinton personally called Obama?

MCAULIFFE: No, and nor should she. Let's be very clear. I will say this again. This has nothing to do with Senator Obama. This was all about Hillary Clinton, her campaign, Chris, and her time line.

WALLACE: But given the fact that people have been so offended, wouldn't it make sense for her simply to call and say, "Hey, listen, if this caused you any heartburn, I'm sorry?"

MCAULIFFE: First of all, I don't know why you're saying everyone's offended. You know, the press corps — it's a quiet weekend. Everybody got over-hyped. They had a big weekend talking about it.

But do you know what I've got to tell you? Chris, out in Puerto Rico and South Dakota, where I just was last week, and Montana, this is not what they're talking about. They're talking about $4 a gallon gas. They're not going away for Memorial Day weekend. They're talking about having to...

WALLACE: I mean, I'll tell you somebody who's offended. Charlie Rangel, one of your big supporters, one of the people who helped get Hillary Clinton into politics running for the Senate from New York, said it was one of the dumbest remarks he'd ever heard. So there are a lot of people who were offended.

I'm going to ask you one last question.

MCAULIFFE: Congressman Rangel's entitled to his opinion. I can tell you for the vast majority of people who are voting in these upcoming contests, and why we're in this to win the nomination, they want us focused on the issues that are affecting their daily lives.

WALLACE: Last question. Senator Clinton explained her reference to the Kennedy assassination by saying that the family is on her mind because of Ted Kennedy's recent illness.

But as you point out, more than two months ago, here's what she told Time Magazine. "Primary contests used to last a lot longer. We all remember the great tragedy of Bobby Kennedy being assassinated in June in L.A."

So it's not true that she started thinking about this and it was on her mind because of Ted Kennedy's illness.

MCAULIFFE: Maybe, obviously, in this context, she has had thousands of interviews since she talked in March to Time Magazine, thousands and thousands. Maybe on this one editorial board she was back because she was thinking about Senator Kennedy and the brain cancer and all of that issue.

WALLACE: OK.

Let's turn to the rules committee.

MCAULIFFE: OK.

WALLACE: This week Senator Clinton compared the decision to strip Florida and Michigan of all of their delegates to slavery, to the election in Zimbabwe where a dictator is trying to hold onto power, to the recount in Florida. Does she really see parallels there?

MCAULIFFE: What she sees is 2.5 million people who went to polls, who voted, who were certified at the county and at the state level. We are not a nation of 48 states. We're a nation of 50 states.

We have to make sure — they have already paid a price, these two states. The rule worked. Other states didn't move up. We got to protect the sanctity of Iowa and New Hampshire. They paid a huge price. Nobody campaigned in their states.

Now we need to look toward the November election. We have to win Florida and Michigan. These are key states for us in the electoral college. We can't have 2.5 million people who went and voted.

It wasn't the Democrats' fault in Florida, Chris. It was done by the Republican governor and the Republican legislature. They denied the Democrats...

WALLACE: But wait a minute. The Democratic Party — the Democratic Party — voted last year to strip Florida and Michigan of all of their delegates if they moved up.

MCAULIFFE: Right.

WALLACE: And Hillary Clinton agreed to that. Let's take a look at what she said to New Hampshire public radio last October. "I signed the DNC pledge not to campaign, not to spend money in any of the states that did not comply with the rules established by the DNC. It's clear this election they're having is not going to count for anything."

Mr. McAuliffe, why was it clear last October that Florida and Michigan were not going to count, and now she wants to count them?

MCAULIFFE: Well, she wanted to support the DNC, who was trying to hold back all these states who wanted to move in front of February 5th, move up in the calendar. And I will tell you today it worked. We didn't have other states move up.

But we're past that. The rule was applied. I would say the rule worked. And you know what? They paid a huge penalty. But now how do we get these people in the process for the November election?

I will say it again. Florida is very raw over this topic, obviously, after we had an election stolen from us in 2000. Al Gore did win that election. But I've been on this with Fox before.

But looking forward, we've got to make sure they're included this time around. That's all we're saying. It is in the best interests of Senator Obama and Senator Clinton that we count these voters.

Right now Hillary Clinton wins Florida in the general election. Chris, when you add that to the blue states that Democrats historically win, we win Florida, guess what? We win the White House. This is important. She also wins Michigan. Very important.

WALLACE: OK. But let's talk about how they're included. The Michigan state party is going to go to the rules committee next Saturday and is talking about 69 delegates for Clinton, 59 delegates for Obama.

The Florida superdelegate bringing the case to the rules committee is talking about giving all of the delegates a half a vote — not a full vote, a half a vote. Would the Clinton camp accept those two compromises that are coming from the states themselves?

MCAULIFFE: We would like to see all the delegates seated. As you know, in Florida, these delegates have already been assigned. These are real people. It's not like these are just numbers. These are real people.

WALLACE: So you say you're going to oppose the solutions that are being proposed from the states themselves?

MCAULIFFE: As the former chairman of this great party, I would never try to tell the rules and by-laws committee what to do. They're going to hear it on Friday. They're going to make a determination. Let's let them vote. And then we will make our decision accordingly.

WALLACE: When you say make your decision accordingly, Clinton told A.P. that if the rules committee votes against her position, she's prepared to go all the way to the convention.

MCAULIFFE: We are prepared to fight this so that all 50 states are included, that the delegates be seated. Let's have no questions about that. This race is still very close.

WALLACE: All the way to the convention?

MCAULIFFE: We'll see where we are. I'm not going to have — rules and bylaws are going to meet on Friday. Let's let them make a decision.

WALLACE: But you're not saying that you necessarily will abide by their decision if you don't like it.

MCAULIFFE: I am not saying that today. I'm saying let them make their decision and then we will determine — listen, we're in a close fight for the nomination. It is very close.

At the end of this process, Hillary Clinton will have received more popular votes and will be very close on delegates. Out of 4,400 delegates chosen, Chris, it could be, you know, less than 150 delegates. It is close.

Our argument's going to be to the superdelegates, "You know what? She won the popular vote, but she wins Florida, Michigan, Ohio, Pennsylvania, West Virginia, Arkansas, Nevada."

You look at an electoral college map today, Chris. Hillary Clinton beats John McCain by 50 to 75 electoral votes. She wins the White House. This is what is important. We have to change the policies of this country. We need Hillary Clinton in the White House. We are going to fight to ensure we have it.

WALLACE: Finally, there were several reports this week — New York Times, Time Magazine — that if Senator Clinton can't win the nomination, that her husband, your good friend Bill Clinton, is openly talking about the idea of her being on the ticket as the number two.

Question, because no one is closer to Bill Clinton than you are, with the exception of Hillary and Chelsea: Is it true?

MCAULIFFE: One hundred percent not true. I do speak to the president every day, many days several times a day. We talk all the time about this. Zero.

It is unfortunate these stories — and I said the other day, "I'd like to know who is putting a lot of these stories out." Anyone who wants to write the story, feel free to call me up. I could have knocked that story down...

WALLACE: So are you saying he has no opinion on whether or not she should run for vice president?

MCAULIFFE: He has an opinion that Hillary Clinton — like I do, and Hillary and others — that she will be the nominee. We are running to win the nomination. We're excited. As I say, read all the press reports Friday. Hillary has now moved ahead in the popular vote.

Every vote should count, and that's what we're fighting for. So there have been no discussions about V.P. There have been no discussions with the Obama campaign about that. These stories are all false.

We are in to win the nomination. Crystal clear. We're all on the same wavelength.

WALLACE: But you have said on the record that if she doesn't win, you think she would be a good vice presidential choice because you feel that, in fact, she's won 16 million votes. It would bring the party together. Final question.

MCAULIFFE: We think 17.6 million.

WALLACE: OK, but who's counting?

MCAULIFFE: Who's counting, right?

WALLACE: Exactly.

But given her comments on Friday about assassination — and it seems to have excited some feelings in the Democratic Party...

MCAULIFFE: It's excited Fox, I can tell you that.

WALLACE: Well, it seems to have excited a lot more than just us.

MCAULIFFE: OK.

WALLACE: Charlie Rangel, I point out. You say the Obama camp. Would it be harder to put together a Clinton-Obama — rather, an Obama-Clinton ticket?

MCAULIFFE: Well, what I've said no matter what happens, with this being so close, historically close — we've never seen anything like this before. You know, there have been — 36 million Democrats, as you know, have come out — and independents — and voted in our primaries and caucuses. It is extraordinary.

It is 20 million more people, Chris, than voted in 2004. Think about that. There's a lot of excitement. We need to make sure as Democrats that at the end of this process, whenever that is, that we all come together in one capacity or another.

Hillary has said if she's not the nominee, she will be right there. I will be there. President Clinton. We will all be there 100 percent. But you know what? We're in a primary fight today to win the nomination. That's what this is all about.

We're going to fight it out, and when the numbers finally determine the nominee, then we'll all come together. But we're not there.

And I do find it very offensive when T.V. commentators go on, after they did in Indiana and North Carolina, and say the race is over. It's not over. It is not up to someone on T.V. to tell voters that it's over. Why would they say it's over?

WALLACE: Did it happen on Fox?

MCAULIFFE: No, it did not. In fairness, it did not. Fair and balanced. I've said that before.

WALLACE: Exactly.

MCAULIFFE: Fox has been pretty good on this stuff. But listen.

WALLACE: We've got to go. You're going to keep Chris Van Hollen from being on T.V.

MCAULIFFE: OK. It's not over till it's over. Someone has to get the magic number. We just won Kentucky by 35 points. We won West Virginia by 41 points.

WALLACE: OK.

MCAULIFFE: These are purple states that we won in '92 and '96.

WALLACE: And let me just say, as we leave, thank you for not bumping my father off on...

MCAULIFFE: How is he feeling?

WALLACE: He's feeling just great, thank you.

MCAULIFFE: Does he like scotch?

(LAUGHTER)

WALLACE: He's sitting in his Barcalounger watching today, too.

MCAULIFFE: Yeah, we call them Lazy Boys in Syracuse.

WALLACE: All right. Thank you.

MCAULIFFE: Thank you, Chris.

WALLACE: Thanks for coming back.