This is a rush transcript from "Hannity," August 5, 2009. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: With each new day it seems that more and more Americans are speaking out against the direction in which Democrats are now taking this country. And that is our headline this Wednesday night. "Outrage." But unlike when it was members of their own party protesting, Democrats are now chastising anybody with an opinion.

Now the Democratic National Committee has even gone as far as releasing an advertisement calling protesters "an angry mob." Let's take a look.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The right-wing extremist Republican base is back. They lost the election. They lost on the Recovery Act, the budget, and children's health care. They've lost the confidence of the American people after eight years of failed policies that ruined our economy and cost millions of jobs.

• Great American Blog: Watch the DNC ad and sound off!

Now desperate Republicans and their well-funded allies are organizing angry mobs just like they did during the election. Their goal? Destroy President Obama and stop the change Americans voted for overwhelmingly in November.

SENATOR JIM DEMINT, R-S.C.: It will break him.

RUSH LIMBAUGH, RADIO TALK SHOW HOST: I hope he fails.

UNIDENTIFIED MALE: This mob activity is straight from the playbook of high-level Republican political operatives. They have no plan for moving our country forward, so they've called out the mob.

UNIDENTIFIED FEMALE: And I want to know why are you people ignoring his birth certificate.

UNIDENTIFIED MALE : Call the Republican Party. Tell them you've had enough of the mob.

The Democratic National Committee is responsible for the content of this advertising.

(END VIDEO CLIP)

HANNITY: All right. There you have it. Democrats are alleging that the countless Americans that we have seen speaking their minds at town halls around this country are funded by special interest groups. Well, the latest person to be confronted at a town hall was House Majority Leader Steny Hoyer.

Let's take a look at this video.

(COMMERCIAL BREAK)

UNIDENTIFIED MALE: They're lying to me.

UNIDENTIFIED FEMALE: That's right.

UNIDENTIFIED MALE: What are you waiting — I don't have sophisticated language. I recognize a liar when I see one.

(CROSSTALK)

CONGRESSMAN STENY HOYER, D-MICH.: I didn't say what you're saying.

UNIDENTIFIED MALE: Well, you said it was the same as the Bush administration.

HOYER: I said it hasn't changed.

UNIDENTIFIED MALE: No it wasn't. Listen, I'm a registered Democrat, OK?

HOYER: Me, too.

UNIDENTIFIED MALE: Why would you guys try to stuff a health care bill down our throat in three to four weeks when the president gets six months to pick one dog for his kids?

(CROSSTALK)

(APPLAUSE)

(END VIDEO CLIP)

HANNITY: All right, was that the angry mob that the DNC is talking about? And was that man, who by the way is a registered Democrat, coached by Republican operatives? Of course not.

And joining me now is the author of "Cultural Corruption: Obama and His Team of Tax Cheats, Crooks and Cronies," which by the way will debut at number one on the The New York Times bestseller list for the week of August 16th.

Video: Watch Sean's interview

Michelle Malkin, welcome.

MICHELLE MALKIN, "CULTURE OF CORRUPTION" AUTHOR: Thank you.

HANNITY: Are you part of this angry mob and rabid right-wring extremists funded by K Street lobbyists?

(LAUGHTER)

MALKIN: Well, this is the mother of all smear campaigns by the Democrat National Committee and the White House. And this is the way they play. It's the Chicago way. It's hardball politics. It demonized your opponent, stifle dissent.

And it's laughable coming from an organization and a machine that has done nothing but Astroturf fake grassroots in support of ObamaCare. And if you want to talk about K Street, let's talk about 1825 K Street. That is ground zero for the Soros and Tides Foundation-funded operation that has failed to put people on the ground to counter a truly grassroots movement among the tea party activists and counterinsurgency of taxpayer groups.

HANNITY: Michelle, you know, the top three, you know, conservative books in this country right now, one is yours, one is Mark Levin's, these are books, conservative books, conservative manifesto. You're debuting at number one. Mark was number one for 14 weeks in The New York Times list.

And to — usually, they'll attack bloggers, they're attack the Internet, they'll Michelle Malkin, Sean Hannity, Rush Limbaugh, Mark Levin. They'll attack FOX News. But now they're directly attacking the American people.

Strategically, it doesn't seem like a wise thing to me. What do you think the fallout will be?

MALKIN: I think there're going to be a huge backlash and that's because they misunderstand the roots of this movement. It is not something directed from the top down. The Republicans can only wish that they could've been so competent to have seen this coming.

Nobody saw it coming except for the people on the ground, people on the Internet, people on the blogosphere. And of course, FOX News was treating the tea party movement with respect while others were denigrating them and using vulgar language to talk about their role as participants in democracy.

These people — I know — I've been to many of the tea parties. Many of them are independent. Many of them are as disgusted with Republicans who betrayed their principles as they are with Democrats. And they want what Obama promised but failed to deliver. Transparency, ethics, fiscal responsibility, and personal responsibility.

And if Robert Gibbs and Rahm Emanuel and the entire Chicago machine think it's going to do them well in 2010 and 2012 to keep smearing and libeling these people, go ahead and keep on producing those kinds of ads.

HANNITY: Well, I got to tell you, strategically, tactically, it seems almost idiotic to me to attack the American people. And you look at these videos. We're going to go through these in a few minutes with Jonah Goldberg. But you know, a man wearing a baseball cap and an elderly woman talking to Claire McCaskill, and a veteran talking to Tim Bishop.

You know this hardly seems like a mob. It seems like they are so out of touch, and tell me if I'm right, that they don't really recognize that this is an organic, grassroots rebellion by the American people because we think the country is going in the wrong direction.

Do they not see it?

MALKIN: They're completely ignorant and tone deaf of the movement. And, you know, again, it's classic projection from true mobsters. What did we see over the last eight years by anti-war zealots shutting down ROTC offices and harassing marines.

We've seen open border zealots, mobsters shut down speech on campuses. And you didn't hear a peep from all of these delicate people who are now concerned about raucous behavior.

HANNITY: Yes. You know, once Alec Baldwin referred to me as a former construction worker, and by the way, I'm very proud of the fact. It was one of the greatest life experiences I've ever had, doing really hard work in my life, but I thought it was revealing in terms of an elitist, liberal mentality.

Barbara Boxer, I think, fell into the same trap when she said, oh the people at the tea parties were well dressed. Did you find that as revealing as I did?

MALKIN: I did. And this kind of class warfare and denigration is a hallmark of the culture of corruption and the Democrats in Washington who have completely lost touch with populist movements.

And so all they can do now is try and redefine participatory democracy as some sort of threat to the democracy that we are trying to save.

HANNITY: All right. One of the things that's emerging out of this, Michelle, is we're seeing how cowardly some of these politicians are as they are now canceling — they are afraid to have these town halls. They're doing telephone town hall meetings rather than going there in person.

Barack Obama, The Hill reported today, is now encouraging Democrats, and I would assume groups like ACORN and others, to go out there and try and flood these town halls.

Do you think that's going to be an effective strategy? Or support dropping so quickly for healthcare that they're not going to be able to pull it back, that politicians will fear now supporting Obama and they're willing to separate from him?

MALKIN: They are desperate. They are flailing. And in one case, there's an Arkansas congressman who hid behind ill children. He rescheduled his congressional forum at the children's hospital to try and mitigate any participatory democracy.

But you know what? It is going to backfire and the reason why is because there isn't the passion as there is on our side to defeat this thing and to preserve choice in health insurance and health — and medical decisions.

And these Soros spots have been outnumbered 10, 20, 50 to 1 and I don't think any of the kind of missive that the Obama administration is sending is going to change that.

HANNITY: All right. First of all, congrats on the new book. It's very well written as you launched it here in this program. We are honored to have you back. Thank you, Michelle. Appreciate you being with us.

MALKIN: Thanks for all your support, Sean. Appreciate it.

HANNITY: Thank you.

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