Updated

This is a rush transcript of "Special Report With Brit Hume" from December 17, 2007. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

SEN HILLARY CLINTON, PRESIDENTIAL CANDIDATE: Campaigns are like life. Some days you're good, some days you got some challenges. You have to get up the next day and overcome them. That's how I live my life. That's how I run my campaign.

And I feel really, really good about where my campaign is.

(END VIDEO CLIP)

BRIT HUME, HO ST: Indeed she may — may Hillary Clinton feel good about it — but it has not been, at least in terms of her standing in the polls in a couple of key early states, the best couple of weeks she could have had.

Some thoughts on all this now from Fred Barnes, executive editor of The Weekly Standard, Nina Easton, Washington bureau chief of Fortune Magazine and the syndicated columnist Charles Krauthammer — FOX News contributors all.

Nina, it doesn't appear yet that anything that she has tried has broken the momentum that Barack Obama has shown in the opinion polls.

NINA EASTON, WASHINGTON BUREAU CHIEF, FORTUNE MAGAZINE: Let me quote Barack Obama, who just recently in the past couple of days said, look, last month I was an idiot, and this month I'm a genius.

I think there's a lot of this like lemming running to proclaim that Hillary Clinton is in freefall. She has always been in trouble in Iowa, that always been the case. And it's clear that she peaked in Iowa —

HUME: You mean it's always been a difficult state for her?

EASTON: It has always been a difficult state for her.

She peaked in Iowa and nationally, actually, in early November, right after she stumbled that debate in Philadelphia, where she was asked the question about should you grant illegal immigrants driver's licenses, as New York state was proposing.

She stumbled on that, and it was an opportunity for Barack Obama to look like a big guy. He stood up to her, tough, and it raised his stature. Since then, of course, there have been these attacks against him from the Clinton campaign that have backfired. Yes, she is stumbling. Yes, the trajectory is that she has turned it down and he has turned it up. I still think there's a chance for her in Iowa, even though her husband calls it a miracle, which by the way, I think —

HUME: He said he is not low balling!

EASTON: I think this is, once again, Bill Clinton's spin. Keep in mind, Bill Clinton lost Iowa, came in second in New Hampshire in '92, and then he was suddenly the comeback kid. So this guy knows about spin.

And I think it's still all in play, and we shouldn't be writing off Hillary Clinton.

FRED BARNES, EXECUTIVE EDITOR, WEEKLY STANDARD: I agree: she's not dead yet. But she is certainly heading in the wrong direction. And she acts desperate. Her husband acts desperate. Going on Charlie Rose and saying that —

HUME: It would be a miracle if she won?

BARNES: Well, it would be a miracle if she won, and Obama just doesn't the experience, he hasn't been around long enough.

I think the Clintons believe that it's their turn, and who is this guy Obama coming along and trying to butt in? Doesn't he know? His turn will come. We'll let him have the next turn. But Hillary Clinton, Senator Clinton, it's her turn now — I think that's what they believe.

But, look, she has a base in the Democratic Party, one that's been there a while, that was built up by her husband, and she's inherited a lot of it. I agree with Nina that it's not as great in Iowa as it is in other states like New Hampshire.

And if she loses in Iowa and comes back and wins New Hampshire — she will probably lose in South Carolina — she will still be in the race, and it will be a horse race between her and Barack Obama.

So, I agree, we shouldn't be burying her yet.

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: And, for sure, there will be another cycle in the campaign coverage, which will be her comeback. It is inevitable, and if it doesn't happen, we're going to make it happen because the press will want a story.

But I think there's a fundamental problem that she has that explains her fall, and that is we saw on the front page of "The New York Times" today. Her staff is talking about the big theme has to be change, change, change, and she is a change agent. She used the word a dozen times in all of her appearances this morning on the shows.

But what everybody understand is if you elect her, what you are electing is a Clinton restoration. It's a return to the '90's. You are going to get the same couple, except now it is going to be officially two presidents, with all the complications of this odd and strained marriage.

You're electing a marriage, and you're going to have all of the complications that we read about today, about the struggles within his people in the campaign, her people in the campaign. Imagine how that's going to be occurring over and over again if they are in the Oval Office.

The advantage Obama has is he's offering a change and a future that is a clean slate, and hers is a return is to the '90s, and the slate is not very clean.

EASTON: And her stance with experience, though versus Obama, and I don't see what the problem is with her raising questions about Obama's lack of experience. It is when they draw a contrast between the candidates —

BARNES: It is like they just got out of high school, and it is ridiculous.

And, look, when Hillary Clinton talks about 35 years of experience, a lot of that experience is just as a spectator of politics. Her husband, remember, was the governor. Her husband was the president. She may have done things like the healthcare plan, which was a huge disaster, but the rest of the time, that's not real experience.

I liken it to going to a football game. If I went to a football game and watched the game, and I came out of the game and said, I watch the game and I come out of the game and said, well, I'm experienced at football, and that's sort of what she is doing. Look —

HUME: You're suggesting that she has been a fan of politics but not a player?

BARNES: She is a spectator — she is sort of a player, with no responsibility.

EASTON: A spectator is not a person that came up with a healthcare plan that she was wildly criticized for and had to deal with all the fallout.

BARNES: She blew it, too. She talks about fighting for 35 years for all these things. Compare that to McCain when he says he was fighting.

HUME: That's a good point.

Here is quick update, but the way, on that grapevine item we did from the "New York Sun" story about the Princeton student who alleged he had been beaten after coming out against the school distribution of condoms.

"The Daily Princetonian" now says that Francisco Nava, that's the guy, has admitted he made up the story and fabricated ex-mails threatening his life and those of other student and one professor.

Nava reportedly confessed to police today. He has been released with no charges so far. The school says the investigation continues.

Next up with our panel, the proper role for religion and politics — is there one? If so, what is it? We'll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. BARAK OBAMA, PRESIDENTIAL CANDIDATE: I am so grateful to be here today, giving all praise and honor to god. Look at the day that the lord has made.

MIKE HUCKABEE, PRESIDENTIAL CANDIDATE: At this time of year, sometimes it's nice to pull aside from all of that and just remember that what really matters is the celebration of the birth of Christ, and being with our family and our friends.

I hope that you and your family will have a magnificent Christmas season. And on behalf of all of us, god bless, and merry Christmas.

(END VIDEO CLIP)

HUME: Well that message from Mike Huckabee, where he said have a wonderful Christmas season, but it also took note of that fact that this is the celebration of the birth of Christ. It was not exactly a non- denominational season's greeting card in the form of a campaign commercial.

And, of course, what you heard from Barack Obama certainly brought his faith front and center before the audience to whom he was speaking, I guess, in South Carolina.

Charles Krauthammer, who is at my side here, has written of this campaign "It is knee deep in religion." And he says it is only going to get worse, "but a certain kind of conservative is not content," he went on, "to argue that a religious underpinning for a policy is not disqualifying. He insists, does this conservative, that it is uniquely qualifying. Indeed, that it confers some special status."

Charles, we will come to you about all this in a moment, but, first, what about this, Fred? Barack Obama is a man of faith. Mike Huckabee is a man of faith who went so far with his faith as to become a minister. Is it fair to accuse him of running improperly on his faith?

BARNES: I think Mike Huckabee is. And we have seen him in a different — I wouldn't object that much to his Christmas card ad, but his earlier ad was the one that starts out by saying my faith defines me. And then he is a Christian leader. And that is clearly a pitch for a vote for me because I'm a Christian.

I think, beyond that, there's not much. I know Charles complains about one line in Mitt Romney's speech about his Mormon faith, but beyond that — I have been out with Romney. He doesn't campaign on his faith. Other candidates don't.

HUME: You think Huckabee does?

BARNES: I think he does. But, you see, Barack Obama, it was Sunday, and he was in South Carolina, and, so far as I know, and I haven't been out with Barack Obama, but he's not campaigning on his faith.

Look, there is a difference between running on your faith, saying vote for me because I'm a Christian, and someone who just mentions his faith from time to time, as George W. Bush did in 2000.

EASTON: There is nothing new about invoking god in presidential elections. The rise of the Christian right in the Republican Party is what it is. It's fine. It is like saying I'm gun owner. It is a way to identify and to pander to voters.

Let's go back to 1988. You had Pat Robertson, a televangelist, come in second in Iowa. Flash forward to 2000, and you have George Bush naming Jesus Christ as his favorite philosopher.

This is — what's different is that the Democrats have decided they wrote off, in a very narrow election in 2000, they wrote off voters who were religious because of their secular speak, the way they talked to voters. And so now you see Barack Obama and Harry Reid, actually, in the Senate trying to appeal to those voters. That's the difference.

KRAUTHAMMER: I agree it is not new. It is very old, but I think Huckabee did go over the line in that ad by saying that as a Christian leader he was appealing suddenly to the many evangelicals who believe that Mormons are not Christians, and perhaps they're heretical, and thus he is a superior candidate. That's what's wrong.

I think it's time that all the candidates started rendering unto Caesar. It is completely harmless, that Christmas message from Huckabee. That's fine. Or the invocation by Obama in South Carolina. But there's an implication that there is something special about being a minister or Christian or a believer —

HUME: But if there were ever a candidate who, seems to me by the way he has lived his life, made it either inevitable or, at least, appropriate that he should talk about his faith even, indeed, campaigned from it, it would be Huckabee.

KRAUTHAMMER: But he is implying that there is something special about that that makes him uniquely specially qualified to be president.

We've got a war on terror. We have difficulties in the economy. We have immigration issues. Religion is not the key. Being a minister is not an answer on those issues.

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