This is a rush transcript of "Special Report With Brit Hume" from September 25, 2008. This copy may not be in its final form and may be updated.

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SEN. CHRIS DODD, (D-CT) SENATE BANKING COMMITTEE CHAIRMAN: We've reached a fundamental agreement on a set of principles.

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REP. BARNEY FRANK, (D-MA) HOUSE FINANCIAL SERVICES COMMITTEE: We are on track, I believe, to pass this. The market should calm down.

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REP. JOHN BOEHNER, (R-OH) HOUSE MINORITY LEADER: Though there have been ideas kicked around and discussed about how that might be modified, but there are no decisions yet.

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PRESIDENT GEORGE W. BUSH: This meeting is an attempt to move the process forward. My hope is that we can reach an agreement very shortly.

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BRIT HUME, HOST: Well, the very shortly included the meeting at the White House. The president's hopes were dashed. All indications are that it was a highly contentious meeting.

Democrats, in particular, objected, I think, to the meeting itself, which I suspect they feel was a stunt. And the Republicans, as Senator Shelby indicated and others coming out of the meeting, are not onboard with this plan even as modified.

Some thoughts on all this now from Fred Barnes, Executive Editor of The Weekly Standard, Mara Liasson, National Political Correspondent of National Public Radio, and the syndicated columnist Charles Krauthammer, FOX News contributors all.

Fred, your thoughts on what happened today?

FRED BARNES, EXECUTIVE EDITOR, THE WEEKLY STANDARD: First, the president's speech last night had no impact on anybody, at least on Capitol Hill.

Secondly, those announcing the bill, this agreement this morning, whether it was Chris Dodd or Barney Frank, who is a House member, seem to think we have a unicameral legislature-only the Senate! The House—I mean this bill is so far from being passed in the House, it is not even close. It doesn't have a majority of Democrats, much less a majority of Republicans ready to vote for it!

HUME: Not even a majority of Democrats?

BARNES: Not a majority of Democrats.

Look, if they're not Republicans voting for it, Democrats, they don't want to be caught out in their districts being accused of owning this $700 billion bailout of Wall Street.

HUME: It is true that the Democrats have said all along that they're not going to, in the end, act to pass something that they don't have a majority in both Houses and both parties.

BARNES: Yes, and they don't. And they're a long way from getting it.

HUME: They don't because Republicans are not onboard, or they don't like it either?

BARNES: I don't think—a lot of them don't like it either.

But that's a part of it, as well, that Republicans aren't onboard. And, in fact, some of the Republican leaders now are drafting a completely separate bill, one that would not have $700 billion.

The federal government would insure these mortgage-backed securities and so on, and the Wall Street firms and the banks, they would decide at what level they wanted to insure them—20 percent, 40 percent, all of it. And they'd pay a hefty premium for that, but they couldn't get this insurance anywhere else.

At least that's a plan they have worked out.

HUME: A sort of a buyer of last resort, but an insurer of last resort.

BARNES: I mean Hank Paulson made a number of mistakes, but one of them was, thinking, "Gee, I got Barney Frank, he's working on this, the House will be OK." The House is not OK.

MARA LIASSON, NATIONAL POLITICAL CORRESPONDENT, NATIONAL PUBLIC RADIO: Look, I think that Nancy Pelosi laid down her four principles that she wanted and that the president agreed to. There was a fifth principle, which is 100 House Republicans.

And that's kind of key to this. I think Democrats will vote for this if they have given the cover of enough Republicans. And, as we have seen in the past, the House Republicans can often hold the balance of power here, and they have to come along.

And who knows? McCain is either going to bring them onboard or lead them out of the room.

HUME: We will talk about McCain in a minute. But Charles, you thoughts?

KRAUTHAMMER: It was high drama today when Senator Shelby came out of what seemed the middle of the meeting and he made a statement that there was no agreement.

That happened at about 5 o'clock. If that had happened at 2 o'clock, the market would have lost several hundred points in a minute.

HUME: We know that futures were down a little while ago. They were down 40, and Dow futures were down 40 as well.

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: All the rallying in the market, all of the optimism in this week at least is holding its own is based on the assumption of a package.

If it doesn't happen—Wall Street is going to vote. If by 8 o'clock or 9 o'clock tomorrow it looks as if it is all in disarray, there is going to be a vote out on Wall Street—

HUME: But we won't that. I mean they'll have to stay doing it on Monday.

KRAUTHAMMER: But I'm saying when the market opens at half past 9 tomorrow, we will hear from Wall Street. If it's in disarray—

HUME: Wel, it is in disarray. Can we agree on that?

KRAUTHAMMER: I'm saying if it still is in 12 hours, and I think it's going to concentrate a lot of minds on Capitol Hill, including congressional House Republicans.

BARNES: Look, they don't want to go home.

Look, I'm sympathetic to the package, the Paulson thing, and I wish they could have one with no restrictions at all.

But, on the other hand, do you want to be a member of Congress going home and telling your voters that you just voted for a $700 billion package to bail out Wall Street and there's no reform in it?

HUME: And, of course, it isn't just Wall Street.

BARNES: I know it's not, but I'm talking about the political way this is being discussed.

And then, you know Paulson says we will do this now and reform later, and you can't even tell voters "OK, we spent all this money, but we also have fixed it so it will never happen again."

HUME: Look, the candidates played a big role, or maybe they didn't, but certainly their fortunes are at stake. We will talk about that in just a moment.

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CHARLES GIBSON, ABC NEWS ANCHOR: Do we have a debate tomorrow night?

SEN. JOHN MCCAIN, (R-ARIZ.) PRESIDENTIAL CANDIDATE: Well, I'm hopeful, I'm very hopeful that we can. I believe that it's very possible that we could get an agreement so that there will be time for me to fly to Mississippi.

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SEN. BARACK OBAMA (D-ILL.) PRESIDENTIAL CANDIDATE: When you inject presidential politics into delicate negotiations, sometimes it's not helpful. The cameras change things.

And I think that right now the key is people not worrying about who gets credit or who gets blames, but just getting things done.

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HUME: And Senator Obama went on to say, as Senator McCain had, perhaps so Senator Obama with more conviction, that he thought there was no reason why he and Senator McCain couldn't fly down to Mississippi at some point tomorrow — and he hopes of course there would be a deal — but have their debate.

Well, anyway, this has been quite a—- the presidential politics, as Barack Obama said — certainly have been injected into this. They were probably part of it anyway. After all, one of these men will have to execute whatever agreement is reached, if, any indeed, is.

So the question is McCain made a big dramatic move yesterday, called off campaigning today, proposed a meeting that the president held, came down and attended, as did Senator Obama. Who is ahead in the last 24 hours in your view, Charles?

KRAUTHAMMER: Well, the twists and turns of this are just amazing. As you say, McCain offers a gambit. Obama calls his bluff. McCain...

HUME: ...or his bet.

KRAUTHAMMER: Well, I mean the bluff is that— the assumption is Obama might have agreed to a postponement, well he didn't.

So McCain now has to now fly in and be the guy on the white horse who solves all this.

Which is why at noon today, we saw earlier in the sound bites, the Democrats declaring that the whole deal is done as a way to embarrass McCain because he hadn't even arrived in Washington yet.

It turns out it was a bluff and a phony. No deal. So that looks like it's helping McCain, which is why Obama shows up tonight to interview here and on other networks.

He understands that what's happened is McCain has put himself at the center of action, a man of action, and Obama looks like he's just a debater and observer.

So Obama now stays in town. He goes on TV. He says he's gonna help and negotiate. And he understands McCain has gotten a step up on him.

LIASSON: Look, I think McCain raised the stakes for Obama, but he raised the stakes for himself. Now he has to stay here and really lead. In other words, he can't just make it into a political stunt, where he shows up — knowing the deal was cooked and just comes in to try to grab cracker.

No. He has to come and do something—either lead the House Republicans into some kind of compromise with everybody else, or lead them out, lead a populist rebellion against this bill. We don't even know which path he is going to take. I think he has to do—

HUME: But if something doesn't get done, he's hurt or not?

LIASSON: Well, we don't know yet!

HUME: He said, though, that he is committed to getting something done.

LIASSON: Well, then he has to get it done, which I think means he has to become the leader of the House Republicans...

BARNES: I could agree more.

LIASSON: ...since they're kind of the puzzle piece that has to be put in here. I think he has to become the leader.

And this is so funny about McCain and the House Republicans, is in the past, either he is their most popular person that they want in to campaign for them when it is crunch time because he's popular, or they can't stand the guy!

(LAUGHTER)

So I think now he's thrown his lead in with them in a way, because they are the only rag-tag army that he can lead, and he loves to lead a rag tag army if he can find one.

BARNES: It's not just that. The truth is McCain, if something's going to pass here, if we're going to have something that actually halts the collapse of the financial markets, McCain's just about the only hope now. He really is needed here, and with House Republicans, in particular.

He reminds me a little of a guy, you know, when you have a fight at a baseball game and a batter who has been hit and he runs out to the mound and slugs the pitcher. And then the guys from the bullpen come charging in. That's McCain. You know, really charging in!

Look, where there's a fight going on, and it is a big deal, and it's important, and...

HUME: Is he ahead or behind...

BARNES: Oh, I think he is definitely ahead.

HUME: But he has to deliver, though, doesn't he?

BARNES: He has to work with House Republicans and come up with a deal that both of them will accept. And it is not the deal that is on the table now.

KRAUTHAMMER: He has to produce a McCain-Frank bill.

BARNES: Yes.

LIASSON: Yep.

HUME: That's it for the panel.

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