This is a rush transcript from "The O'Reilly Factor," June 20, 2008. This copy may not be in its final form and may be updated.

Watch "The O'Reilly Factor" weeknights at 8 p.m. and 11 p.m. ET and listen to the "Radio Factor!"

LAURA INGRAHAM, GUEST HOST: In the "Impact" segment tonight: A strong new anti-discrimination policy gives transgender kids in New York special perks if they find themselves in juvenile lockup.

Officials say that there are about 20 to 30 transgender kids in its system and they can now wear whatever uniform they want, be called whatever name they want, and they get special housing. How nice.

Joining us now from New York, criminal defense attorney Randy Zelin.

Randy, this seems so completely whacky to me that I don't really know where to start. But I'm going to start with this. When you talk about special housing, special clothing, making accommodations for names and so forth, I think, who is paying for this? And, of course, the answer is that you and I are paying for it, the American taxpayers, the New York taxpayers. What's your response?

RANDY ZELIN, CRIMINAL DEFENSE ATTORNEY: Well, first of all, a perk is getting extra coffee at the workplace and good coffee, a good parking spot. Being able to exist and survive and being afforded equal protection under the law, that's not a perk. That's a right. And the bottom line is we are talking about children, vulnerable to begin with.

Now, putting them in a situation where you are almost assuring that they could be raped, assaulted, humiliated, they are coming out worse than when they went in, and that's not a perk. That's got to be dealt with, and it's got to be addressed, and this is the best way to address this.

INGRAHAM: Randy, this is juvenile lockup; we have to remind our viewers. It's supposed to actually not be a comfortable environment. It's supposed to teach a lesson.

The lesson I'm getting from all of this is if you are in lockup, if you are in juvenile detention, then you're probably better off saying that you would like transgender treatment because then you do get special accommodations. You don't get to be housed where everyone else is housed. You can wear what you want, be called what you want and all those rules are out the window. So why wouldn't everybody want that kind of treatment?

ZELIN: Because that's really not the goal when you are talking about juveniles. The Family Court Act, it's designed to get these kids straightened out. It's not only about punishment. In fact…

INGRAHAM: Of course not

ZELIN: …it's less about punishment and it's more about straightening them out and giving them a second chance. Why would you want kids to come out worse than when they went in?

INGRAHAM: Wait, wait. Randy, you can't have it both ways.

ZELIN: Sure, you can. You can have it both ways.

INGRAHAM: You can't have it both ways and say they are children and then be obsessing and focusing on their sexual preference or their sexuality.

ZELIN: Why not?

INGRAHAM: Because I think you have a lot of people watching this right now who say has the world gone insane? We want these kids, of course, to get back on the straight and narrow, to put their lives together, to go out in society and we hope not do bad things to other people and go on to be productive citizens.

ZELIN: We don't understand what these kids are going through and what they're experiencing. What do we do with them? Throw them away? Silence them?

INGRAHAM: No one is saying throw them away, and no one is advocating ill treatment of prisoners.

ZELIN: But you are guaranteeing that unless you do something to them.

INGRAHAM: They are kids.

ZELIN: They are going to come out worse than when they went in.

INGRAHAM: They are kids, are they not?

ZELIN: That's right. And they deserve the chance to survive.

INGRAHAM: Well I think, Randy, we all want that but the question is who pays for it? And what other groups get special accommodation?

If you start with transgender, then they should also, as Massachusetts saw, also allow them to get funding for special surgery, special hormone treatment. You can't stop at one accommodation. You have to keep it going.

ZELIN: But you can start. And where you start is what's in the best interest of the child and this is in their best interest.

INGRAHAM: Where does it end? Right. We're out of time but where does it end. It doesn't end. That's the point. It keeps going.

ZELIN: That's where it starts.

INGRAHAM: Well, yes. The next is hormone treatment taxpayer funded. I appreciate it.

Copy: Content and Programming Copyright 2008 FOX News Network, LLC. ALL RIGHTS RESERVED. Transcription Copyright 2007 Voxant, Inc. ( www.voxant.com), which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon FOX News Network, LLC'S and Voxant, Inc.'s copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.