This is a rush transcript from "The O'Reilly Factor," September 30, 2008. This copy may not be in its final form and may be updated.

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BILL O'REILLY, HOST: In "The Obama Chronicles" segment tonight: the senator's money vision. During my interview with him, I put forth that his tax the rich philosophy might be a socialistic tenet called "income redistribution."

(BEGIN VIDEOTAPE)

O'REILLY: You're taking the wealthy in America, the big earners, OK?

OBAMA: Right.

O'REILLY: You're taking money away from them, and you're giving it to people who don't. That's called income redistribution. It's a socialist tenet.

OBAMA: Bill, Bill.

O'REILLY: Come on, you know that. You went to Harvard.

OBAMA: Teddy Roosevelt supported a progressive income tax. Look...

O'REILLY: Not at the level you do.

OBAMA: I don't like paying taxes. What, you think I like writing a check? What I believe is there's certain things we've got to do, and we've got to help people who are having a tough time.

(END VIDEOTAPE)

O'REILLY: All right. With us now, Tom McArdle, a senior writer for Investors Business Daily.

You know, I like your paper, but you've been pounding Obama mercilessly.

Click here to watch "The Obama Chronicles."

TOM MCARDLE, INVESTORS BUSINESS DAILY: Very much so.

O'REILLY: Mercilessly. What's the biggest problem economically you have with him?

MCCARDDLE: Well, to put it in basic terms, he believes that you can punish the fat cats in America through the tax system, yank up their taxes in a big way without badly hurting the little guy, and that simply is not true.

O'REILLY: All right. But he doesn't see it as punishing. He said to me, listen, Bill, I'll tax you a little bit more. Actually, it's more than a little because of the payroll tax cap coming off, but you're not going to miss it. You're not going to miss that money. You already have a lot of money. So be generous, be kind, and I'll distribute the money to other people. Now that is a powerful message to a lot of Americans.

MCARDLE: It is, yes, politically, absolutely. In your interview with him, he called it neighborliness. When he was in one of the primary debates with Charles Gibson on ABC, he referred to it as fairness. That's one of the big code words of liberal Democrats.

The tax system's purpose should be to collect revenue, not to dole out fairness. And when you try to do things like yank up the capital gains tax — and he's been all over the ballpark on that. He told you 20 percent.

O'REILLY: Right.

MCARDLE: Before this, he said 25 percent. Earlier this year, he's indicating 28 percent.

O'REILLY: Well, there are no capital gains for the next few years. They're going to be wiped out because we can carry losses over. So he's not going to get — the government's not going to get much capital gains tax.

MCARDLE: Well, he's talking about suspending capital gains for small businesses, which shows he fundamentally misunderstands how a free economy works. The big money that the investors invest comes at the higher incomes. If you punish those people, you have a big problem with capital mobility. There is no way that that is not going to translate into lost jobs for ordinary people.

O'REILLY: One of his mantras is I want to build the economy from the bottom up. You hear that every time that he's in a public square. I want to build the economy from the bottom up. That means I want to give Americans — 95 percent is what he uses — money back, a tax break so they'll spend it and the economy will surge. What's wrong with that?

MCARDLE: Well, this is a man, who according to the National Taxpayers Union, wants to spend $293 billion in extra spending annually. He is not going to be able to get all that money from the rich. He's going to have to dip down into middle class, in spite of what he says about 95 percent of the middle class getting the tax cuts.

We, in fact, heard this before. We heard it from Bill Clinton. The centerpiece of his great economic plan in '92, endorsed by all these economists, was a middle class tax cut. Bill Clinton was nodding off as one month before he gave an address to the nation saying not only is there not going to be a middle class tax cut, we're going to have a middle class tax increase.

O'REILLY: Well, that's what's going to have to happen this time because of the bailout. There isn't any money for any of this. And I said that if John McCain were smart in the next debate, he'd say you can't do anything. We just don't have — what are you — China going to lend it to you? Where are you going to get it? Because there aren't enough people in the country, as you said, to provide the funds to expand the government and pay out the bailout. It's not going to happen.

So I think Barack Obama knows that, and he's actually said that recently, you know, some of the things I want to do we're going to have to postpone.

MCARDLE: Yes, that's right.

O'REILLY: See, I don't see Obama as a socialist. You guys do at Investors Business Daily, you think, I guess, he's Fidel Castro's cousin.

MCARDLE: Economically.

O'REILLY: I don't see — I see him as more of an opportunist selling this program to get him elected. I don't think he himself is a socialist, do you?

MCARDLE: Well, I think that when he gets into office, there's going to be some big differences between some of the promises he makes on tax cuts during his campaign and what actually ends up materializing.

O'REILLY: That's what I think. I don't think he can do this stuff without — look, if he gets elected and we're paying off this huge bailout and then he says we're going to have universal health care to the tune of another $500 billion, which is what it would take.

MCARDLE: $100 billion a year health care will cost to try to…

O'REILLY: Easy.

MCARDLE: …get universal coverage. And then, you know, according to health care experts like Robert Lizisky (ph) with the health care blog that will — because there's no cost containment in Obama's plan, cause health care prices to rise. And then you have to have a second wave of health care reform.

O'REILLY: All right. So that's…

MCARDLE: That's when we go whole hog socialism.

O'REILLY: That's impossible though. That's impossible. You can't do it. How is he going to fund it? How?

MCARDLE: Well, that's right.

O'REILLY: He can't.

MCARDLE: That's right. He…

O'REILLY: So I don't think we should be that worried about it. That's what I'm saying. He can't. He can't.

MCARDLE: Well, I don't know. You have a far-left president in the Oval Office and you have both houses of Congress controlled by the Democratic Party, it's very scary.

O'REILLY: Yes.

MCARDLE: They just tried to pass $700 billion of bailout, courtesy of the taxpayers.

O'REILLY: Well, I mean, I think people now are wired into this. So that's another thing. People are watching probably for the first time in my lifetime.

Tom, thanks so much. We appreciate it.

MCARDLE: Thanks, Bill.

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