This is a rush transcript from "On the Record," December 15, 2009. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Tonight: Going rogue. No, not that one, not Governor Palin, Senator McCain, the very top of the ticket. He is demanding -- not asking but demanding the president veto the omnibus spending bill.

Senator John McCain joins us. Nice to see you, sir. And you are demanding a veto. What's up with this? Why don't you like this bill?

SEN. JOHN MCCAIN, R - ARIZ.: Well, I can't stand it because it's such an incredible waste of taxpayers' dollars. The bill that we just passed is a 14 percent increase in spending over last year. Now, this is a time where average citizens, the CPI, the Consumer Price Index, went down. It's full with the most incredible pork. I've selected as my second favorite is the $2.9 million that are going to be used to study surgery in outer space at the University of Nebraska. Now, I'm sure that Trekkies all over America, Captain Kirk, Bones, Mr. Spock and all the others, are very happy about that -- 2.9 million, surgery in outer space. And a huge -- a huge multi -- hundreds of billions of dollars we identified $4.9 billion in pork barrel earmark projects. It's disgraceful.

VAN SUSTEREN: Are they listening to you? When you make the statement that you demand a veto, what do they say, Tough luck, Senator, you lost? I mean, is anyone -- I mean, anyone listening to you on this?

MCCAIN: Well, Greta, one of the reasons why I demanded it was last March, they passed another one of these omnibus bills. It was full of pork. And at the time, when the president signed it, he said, yes, but we're not going to do this anymore. We're not going to let that happen -- change in Washington. When he campaigned, he said there would be change in Washington. He said we'd go line by line and veto and eliminate wasteful and unnecessary spending. This has $4.3 billion full of unnecessary spending.

By the way, one of my other favorites is several hundred thousand dollars to replace (ph) to study irritable bowel syndrome. That's -- I will not editorialize on that earmark.

VAN SUSTEREN: And I'm sure late-night comedians might have a -- have a lot of fun with that one. All right, health care reform. You don't like that one either, do you.

MCCAIN: Well, look, to start out with, again, it's one thing to make promises when you campaign, and then maybe it's understandable when you completely violate those promises. The president said October a year ago, twice when he was campaigning, on the issue of health care reform, he said, I'll have the C-Span cameras in the room when we'll sit down together, Republican and Democrats, and the American people can see who's on the side of the pharmaceutical companies or on the side of the American people.

Well, there's so little known that when I was in a discussion with the senator from Illinois, Senator Durbin, he said he didn't know what was in the bill. And by the way, they just cut one of these really unsavory deals with pharma in order to give pharma a good deal so they'll support the bill. By the way, pharma -- that's the pharmaceutical industry -- has raised drug prices by 9 percent this year -- 9 percent people's prescription drug prices have gone up, while, I mentioned before, the cost of living has gone down 1.3 percent. They are a bad group of people.

VAN SUSTEREN: All right, a couple quick things. Senator Durbin told you he doesn't know what's in the bill? When did he tell you that, and I mean, under what circumstances? Because that seems like something I wouldn't want anyone to know, if that were -- if I were in that situation.

(LAUGHTER)

MCCAIN: Let me say I have great admiration and respect for Senator Durbin. We were having a colloquy on the floor. And we were sort of going back and forth, and I said, Well, how can we really debate this when we don't know what's in the bill? Could the senator, who is the second ranking member of the Democratic Party in the Senate -- I said, could he tell me. And he said, no, he didn't know, either, what was in the bill.

Now, here we are talking about one sixth or one seventh of our gross national product, about a bill that will cause massive increases in taxes and massive cuts in Medicare and increases in spending. And after a year of discussion and debate, that nobody in the Senate except for one, Senator Reid, knows what's in the bill?

VAN SUSTEREN: Well, let me -- I'm always one beat off. Maybe some people would say I'm more than one beat off. But you say that you have admiration and respect for Senator Durbin. When I hear that someone who's one of the leaders in the party, who's advocating a bill and he doesn't know what's in it, frankly, it's hard for me to gather a lot of admiration and respect, to use very nice terms.

Then you say that President Obama, in saying that he was going to put all the debate on C-Span -- and we actually ran SOTs of it from back in the campaign, and we have about five or six we ran last Friday night. You say he completely violated it, which is a nice way to say, Look, he was deceitful. You know, he didn't do that, and he's had the opportunity.

I mean, you know, a lot of you guys use such polite words for some rather important issues. I mean, this is one sixth of the economy, if you -- you know...

MCCAIN: Well...

VAN SUSTEREN: If you don't, you know...

MCCAIN: Let me tell you...

VAN SUSTEREN: I don't -- go ahead.

MCCAIN: Let me give you a couple of points of straight talk. I resent it enormously when Senator Reid comes to the floor and accuses Republicans or compares Republicans to those who fought against the abolition of slavery. He said that. That's -- that's unacceptable.

As far as the president's commitments are concerned, he made that commitment to the American people, so he didn't tell the American people the truth when he was campaigning for president. How's that?

VAN SUSTEREN: Well, that's pretty strong. And then Senator Durbin -- you also -- you know, he -- you say he is -- you admire him and respect him, but he doesn't know what's in the bill that he is one of the leading, you know, advocates of it. Now, it may be a fine bill or a great bill, but if nobody's -- if nobody's even has read it, doesn't know what's in it, it's hard to say it's a good bill or a bad bill. I mean, we ought to at least know what it is.

MCCAIN: Well, could I just say again about Senator Durbin, he wasn't told. He wasn't told.

VAN SUSTEREN: Well, he could demand it!

MCCAIN: So -- but you know...

VAN SUSTEREN: He's a leader! Demand it! He should demand it!

MCCAIN: Yes. He should. He should. He should demand it. He should have demanded it. And now they're going to the White House, and they'll come back and perhaps the bazaar has succeed. We really should have put outside in front of the Capitol a big tent with Persian rugs on the floor so that the bazaar would be open.

VAN SUSTEREN: All right. All right, now, with the earmarks in this huge bill, and it's a very costly bill, the spending bill, and now we -- now we get the health care, if it is, as the Republican Party says, like, a huge financial fiscal nightmare, can you tell me, like, two years down the road, how are we going to feel? What's the practical impact?

MCCAIN: Well, I think two years and perhaps 20 years down the road, we're going to feel terrible because we are committing generational theft. We have a $1.5 trillion deficit this year. Spending is up, as I said, on this pork-laden bill that we just passed, up by 14 percent increase in spending while Americans are out of their homes, out of their jobs, hurting in ways that they have not in our lifetimes.

And so I think that the American people are angry. I think there's a revolution going on out there, and I think that they're going to demand real change this time.

VAN SUSTEREN: All right, so demand real change. You've demanded the president veto this spending bill. Do you have a demand for Senator Reid about the -- about the health care bill now?

MCCAIN: Well, my demand to Senator Reid is that we go back to the beginning, that we sit down across the table from one another. We know there are things we can agree on. We know we can fix health care in America. There has never been a significant reform enacted in the history of this country that wasn't bipartisan in nature.

If Senator Reid succeeds with this legislation, it'll be purely on party-line basis. That's not what America wants from us. So my -- what I would urgently request Senator Reid is we sit down together, we do the things we can agree on. We all know that cost is the problem. They -- we want to get costs under control. They want to change the entire fundamentals of the best health care system in the world.

VAN SUSTEREN: Senator, thank you. Nice to see you, sir.

MCCAIN: Thank you.

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