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

SEAN HANNITY, CO-HOST: There you have it. We're just 14 days away from election day, and Bill Ayers, the unrepentant terrorist, continues to be an issue for the Obama campaign.

Now, new audiotapes surfaced from an interview that Ayers did in April of 2002. Let's take a listen.

(BEGIN VIDEO CLIP)

BILL AYERS, FORMER MEMBER, WEATHER UNDERGROUND: I considered myself partly an anarchist then and I consider myself partly an anarchist now. I mean, I'm as much an anarchist as I am a Marxist which is to say I find a lot of the ideas in anarchism appealing. I'm very open about what I think, and nobody here is surprised about what I think.

There is a struggle over various religious fundamentalism, Jihad being the most visible, but the religious fundamentalism of the Christians and of the Jews is equally troubling. Is one of those regrets that I took extreme measures against the United States at a time of tremendous crisis? No, it is not. I don't regret that.

(END VIDEO CLIP)

HANNITY: There again, "I don't regret it."

Now, according to the University of Illinois Web site, just seven days later, Ayers was scheduled to appear with Barack Obama on a panel sponsored by the university and the Center for Public Intellectuals, or I would argue pseudo intellectuals.

Joining us now, author of "The Case Against Barack Obama," David Freddoso.

Once again, on the record multiple times, "I don't regret being at war with our country, bombing our Pentagon, Capitol, police headquarters. I'm an anarchist; I'm a Marxist."

And here is the blurb that Barack Obama gave to William Ayers, the terrorist's, book. And he said, "A searing and timely account on the juvenile court system and the courageous individuals that rescue hope from despair."

Why has this -- and I don't -- I can't explain this to people who ask me. Why isn't this a bigger issue in the campaign?

DAVID FREDDOSO, AUTHOR, "THE CASE AGAINST BARACK OBAMA": Well, the McCain campaign has done its best to make it an issue. I think that, if they don't attack it right, they give the Obama campaign the ability to answer with what I think is -- it's a good answer to say, "Well, I was 8 years old when all of this was going on."

Video: Watch Sean and Alan's interview with author David Freddoso

What we need to remember are two things: one is the fact that Obama was an adult when he decided that he was going to work together with Ayers closely on the Annenberg Challenge.

HANNITY: In his 30's and 40's.

FREDDOSO: And the Woods Fund, which -- and right. And Obama was on the Woods Fund with Ayers for another, I believe, eight months after he gave that quote. So, you know, these are all things where, you know, Obama can say well -- at first he says, "He's just a guy in my neighborhood."

Then he says, "Well, I didn't know he was a terrorist then." And then he says, "I -- you know, I thought he was rehabilitated."

HANNITY: Let me ask you this. There's three issues at stake here. He even said at one point that he thought Ayers was rehabilitated.

But there are three issues that I see in play here, and this goes to the heart of all of these radical associations.

No. 1 is honesty. I don't think Barack Obama has been honest about Ayers, Wright, Pfleger, and the rest of them, Rezko.

The second issue is, these are all 20-year associations or longer. That goes to the heart of judgment. And I think he's shown repeated reckless, irresponsible judgment.

And then the third issue is how do you explain that almost everybody in his life is a real radical? I mean, in this case a terrorist. How do you explain that away and get elected president?

FREDDOSO: It's -- you know, there are a lot of very problematic associations in Senator Obama's life. And yes, you have to say either he's Mr. Magoo and he goes through life, he doesn't know Tony Rezko is a crook. He doesn't know that William Ayers is a terrorist. He doesn't know that Reverend Wright is a bomb thrower who's accusing the American government of putting drugs and AIDS in...

HANNITY: But has he successfully, then, lied to the American people? Has he -- because we know the journalism's dead. There's been no tough questions for this guy. They give him a pass. They know better than we, the American people. They've decided they want this guy president.

So is the issue, then, that he gets a pass, he gets away with all of this, he never gets any tough questions, and then becomes our president? I find that scenario frightening.

FREDDOSO: Yes, and you're exactly right, Sean. He, you know, for the most part, has gotten a free pass in a couple of different ways. One is this idea that him, as an agent of positive change whose record shows he really hasn't changed anything.

ALAN COLMES, CO-HOST: David, we've been talking about this for months and months and months, and he continues to do well. So I guess the American people are stupid that they like him?

FREDDOSO: I don't know that they're stupid. I don't think that everyone knows about this.

(CROSSTALK)

COLMES: Do you know how long we've been talking about it on this show?

FREDDOSO: I'm really surprised, Alan, that -- I find from the very -- well, not everyone watches, unfortunately. They should, but...

COLMES: Let me ask you this.

FREDDOSO: I'm amazed, Alan, at how few people even know that he threw all of his opponents off the panel.

(CROSSTALK)

COLMES: Can you catch Marxism from sitting on a panel with somebody?

FREDDOSO: Can you catch Marxism? No, but when you endorse someone's ideas about education and juvenile justice...

COLMES: Well, tell me what's the idea...

FREDDOSO: ... and you spend time wasting money of donors on the Annenberg Challenge by giving it to groups that don't improve students' education...

COLMES: Excuse me.

FREDDOSO: ... you've got to...

(CROSSTALK)

COLMES: You've got your facts wrong here. The money was given by Annenberg, Lenore Annenberg, the wife of the late Walt Annenberg, sat on the panel. Two Republicans -- a number of Republicans, including two presidents of universities, including the former president of Northwestern University.

So you're besmirching not just Barack Obama but, I guess, every Republican who ever was in the same room, gave a speech, or spent time with Bill Ayers. It's ridiculous.

FREDDOSO: If you read the final report on the Annenberg Challenge, they deserved to be besmirched. I don't care who they are. They threw away the $50 million from the Annenberg Foundation, and then they raised two to one from other people and then...

(CROSSTALK)

COLMES: Actually, that's not true, because the Annenberg Challenge was considered a success. But can you tell me what policy provision...

FREDDOSO: Not in Chicago. Not in Chicago, Alan.

COLMES: And by the way, Ayers was named citizen of the year, and also worked for Mayor Daley.

HANNITY: Oh, how impressive.

COLMES: Tell us what position Barack Obama has that you fear will ruin the country because he knew Bill Ayers. What policy position specifically can you tell me is going to bring our country to wreck and ruin because they sat on a panel together?

HANNITY: Can I answer?

COLMES: No, I'm talking to the guest. Go ahead, David.

HANNITY: I want to answer.

COLMES: Excuse me. David, go ahead.

FREDDOSO: I don't think the fact that they sat on the panel is going to ruin America.

COLMES: Tell me what's going to ruin America because he knew Bill Ayers.

FREDDOSO: I don't even believe -- in "The Case Against Barack Obama," I even start off by saying, look, America can survive a President Obama.

COLMES: Tell me one policy he's got that, because he knew Bill Ayers. What is it?

FREDDOSO: He's got a lot of bad policies, Alan. It's not that he's going to wreck the country. It's that he's going to raise taxes. It's that he's going -- that he doesn't know what he's doing on foreign policy. And that...

COLMES: What does it have to do with Bill Ayers or Tony Rezko or Reverend Wright?

HANNITY: Poor judgment.

FREDDOSO: Poor judgment and dishonesty. Because I didn't know Rezko was a crook. I didn't know Bill Ayers was a terrorist. Either he can't say anything in front of his face, or else he's, you know -- he's selling us a Bill of goods. It's one way or another. He wants us to think he can't see.

HANNITY: Can I answer now?

COLMES: ... successful selling us a Bill of goods. But thank you very much.

We'll interview you later.

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