This is a rush transcript from "Hannity," June 30, 2009. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: Democrats may be celebrating the passage of the-cap and-trade bill or the cap-and-tax bill in the House, but even with the addition of Senator Stuart Smalley in Minnesota, a groundswell of public opinion appears to be developing against the legislation that could help derail that vote in the Senate.

As a result liberals are turning to the politics of fear to jam this bill through the Senate, and that is our headline this Tuesday night, "Scare Tactics." Now President Obama recently said that House Republicans who oppose the energy bill are 16 years behind the times and some of the president's friends on the left like Paul Krugman of The New York Times have gone even further.

Now he said that anyone who voted against cap-and-tax, cap-and-trade was committing treason against the planet, and his comments were echoed yesterday by Congressman Henry Waxman, a co-sponsor of the House bill. You'll love this. Take a look.

(BEGIN VIDEO CLIP)

REPRESENTATIVE HENRY WAXMAN, D-CALIF.: Since Obama has become president, the Republicans have said no to an economic stimulus bill, they're saying no to the global warming bill, they're saying no to health care reform. They wanted — they want to play politics and see if they can keep any achievements from being accomplished for fear they might become beneficial to the Democrats.

So they're rooting against the country. And I think in this case they're even rooting against the world because the world needs to get its act together to stop global warming.

(END VIDEO CLIP)

HANNITY: All right. So how exactly does the GOP plan to stop what could be the largest tax increase in American history? Joining us now is the chairman of the Republican National Committee Michael Steele.

Video: Watch Sean's interview

MICHAEL STEELE, RNC CHAIRMAN : Hi, Sean.

HANNITY: So let's see. Did I hear what he said?

STEELE: Hey, Sean.

HANNITY: Yes.

STEELE: Hey, Sean, I want the world to pay my tax bill, OK, because the world is not sitting in my bank account right now. I'm the one that's got to pay this bill. Average hard-working Americans out there have to pay this bill. You've been slamming this home every night since this craziness has begun.

People need to wake up and pay attention to the fact that their lives are dramatically about to change here. The president himself, Sean, said that under my global plan, my environmental plan, my energy plan, that your utility bills would necessarily skyrocket.

His words, not ours, not yours, not mine. His words.

HANNITY: What do you make about what Waxman said that you're rooting against the country, and by the way, rooting against the world? What do you say to that?

STEELE: Well, Waxman, I guess, is trying to wax poetic. It's not working because the —

(LAUGHTER)

STEELE: The reality of it is very simply this, Sean, is that we are the ones that are going to be stuck with all of the spending. We have watched this administration spend $787 billion, $20 billion here to keep GM from going out of — going into default. Guess what, that's what they're doing.

HANNITY: Yes.

STEELE: Six percent of that 787 has been spent so far. Now we want to add on top of that more taxes which we know will average somewhere between $1,000 — $1,800 per family, per year. I mean this is crazy. Where is this money coming from?

HANNITY: Look, I got to tell you something. I think more people probably know the facts about Michael Jackson's death than they do about this job-killing bill, this tax-increasing bill.

Literally we're going to end up — companies are going to end up outsourcing jobs, manufacturing jobs to other countries because these rules and regulations don't exist for them, and on top of it we just found out from Senator Inhofe, that apparently the EPA buried evidence that would have undermined the policy on global warming prior to this vote.

Now do you think that should be investigated?

STEELE: Well, A, it should be investigated, but Sean, even if he — if they had revealed it, do you think this Congress would have read it?

HANNITY: No.

STEELE: I mean, you're talking about 1,300 pages worth of law that they didn't even read and they all passed on.

HANNITY: They didn't send out 300 of the pages until 3 a.m. of the morning before the bill was going to be debated, which, by the way, I thought — I think there's a good side for Republicans. This is the Democrats' economy. This is their debt. These are their deficits. This is their weakening of our national security.

In that sense, they own everything. Do you think that...

STEELE: But Sean.

HANNITY: Go ahead.

STEELE: Go ahead.

HANNITY: Well, do you think now, with a filibuster-proof Senate, and our good friend, who by the way, folks, this guy, Franken, he's not all there. All right. But do you think with him in a filibuster-proof Senate, do you think this is now problematic for the Republicans to stop it in the Senate?

STEELE: No, I don't think it's problematic for this reason because unlike the House the blue-dogs in the Senate do not have the cover that Nancy Pelosi gave the blue-dogs in the House.

They could afford to vote against this bill because they had the votes they needed to get it passed. And the Senate is a different story. You're much more exposed. Every vote counts, every vote is on the board, and I think it's going to be a lot harder for those blue-dogs, especially to stand up there, and then go back home and justify raising people's utility bills as they want — as this administration plans to do.

HANNITY: All right. What do you think — I believe that Norm Coleman — when you have counties as they did in Minnesota where you had more votes than you did people registered to vote on Election Day, and when you have different standards apply, I understand why he took it this far, and I understand why he stopped it today. He did it for the people of Minnesota.

STEELE: Yes.

HANNITY: But I, in my heart of hearts, do not believe that Al Franken won that election. Do you?

STEELE: I don't either. I think that this is just craziness at its worst here. You have one part of the state that voted where the ballots were accepted and other parts where ballots weren't accepted with the exact same vote.

It makes no sense they were counting folks who — you know in counties that didn't exist. I mean the whole thing is suspect at best, but look, my hat goes out to my good friend Norm Coleman.

He fought the good fight. He really was a good public servant for the folks of Minnesota. I think they're going to rue the day on this one. I think they already have, Sean, quite frankly. I've talked to enough Democrats in the state...

HANNITY: Yes.

STEELE: Who said, you know, if we could do a do-over, the results, I think, would be a little bit different.

HANNITY: What do you make of the Gallup Poll, the growing number of Americans that actually think the Democratic Party is now too liberal and then the Rasmussen Poll that literally shows, you know, the presidential tracking numbers, you know, those that strongly approve of Obama, 33, disapprove.

He has a negative 2 rating, it's the lowest number he's had since Rasmussen has been polling. Clearly the president's numbers are going down, he seems out of touch, people think the country is on the wrong track.

What does that mean for the Republican Party for — you know, in the 2010 election and in the 2012 elections?

STEELE: Sure. Well, let me take the first poll, the Gallup Poll first. The reality there is that people are beginning to see what these policies actually look like and sound like and feel like, and they're saying wait a minute, this is not what the change unlike Axelrod's pronouncement.

This is not the change we voted for. We didn't vote for a greater government intrusion, so that I think is now getting reflected in those polls.

On the second one, on the Rasmussen Poll, what you're seeing, Sean, and you, again, talked about this before, is the convergence of the popularity of the man with his policies, and they're both going in a direction in which they're about to meet, and when they do, you're going to see the president's popularity fall in the same well, if you will, as the people's feelings for their policies.

And that's an important moment because now, to your earlier point, they're no longer dissociating the man from the presidency or the policy. It's all become one package, and this stuff begins to stick, and the people are saying wait a minute, we don't want a government that's going to own the auto industries and banks and insurance companies. We want a government that creates a pathway...

HANNITY: All right. Let me ask you.

STEELE: ... and that's what the Republican Party is talking about here.

HANNITY: Let me ask you one last question, this one on national security. We've been following a lot of the issues. It seems that Barack Obama doesn't want to meddle in the Iranian election where it's being stolen. He didn't want to come out and support those that were fighting for democracy.

Here we have another Marxist dictator, in this case, Honduras, who clearly was not following constitutional order or the rule of law, and he wanted to create a dictatorship for himself, sort of following the model of Hugo Chavez, and then you have Barack Obama coming out and seemingly supporting the lawlessness of the president.

What do you make of that?

STEELE: Yes. Well, it tells you where the bread is buttered here. And I think that what you have here is the administration picking and choosing the fights it wants to engage in on foreign policy, and unfortunately U.S. policy is consistent from shore to shore.

You cannot pick and choose this way. I think it sends a bad signal, and I think, you know, what the president, President Bush did, with getting us and keeping us safe becomes a little more tricky every single day.

HANNITY: All right. Michael Steele, good to see you, thanks for being with us. Appreciate it.

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