This is a rush transcript from "Your World with Neil Cavuto," June 5, 2008. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST: All right, well, Hillary Clinton today telling supporters in an e-mail that she will, indeed, rally the party behind Senator Obama in a speech that`s now set for Saturday.

My next guest reportedly played a very big role in getting her to this point and to making that speech. And there`s talk that he, himself, could be a potential running mate for Barack Obama. I`m talking about the Pennsylvania Governor Ed Rendell.

Governor, always good to have you. Thank you for coming.

GOV. ED RENDELL (D), PENNSYLVANIA: Hi, Neil. Good afternoon.

Video: Watch Neil's interview with Governor Ed Rendell

CAVUTO: To the Hillary Clinton discussions, were you talking to her, urging her, maybe reconsider this, Senator? Time to give up?


RENDELL: No, I didn`t talk to Senator Clinton directly. I talked to a few people in the campaign.

But I think she intended to do this all along. I think the mistake that was made on Tuesday night is, she should have started out and said, you know, tonight, we`re going to celebrate a tremendous upset victory in South Dakota and celebrate all that we have achieved in this campaign — you know, the most votes ever — and then, in a few short days, I`m going to go out and endorse Senator Obama and bring this campaign to an end. I congratulate him, et cetera, et cetera.

If she had just said that that was the road map — and I believe it always was the road map. I believe that what she did on Tuesday was for her supporters.

CAVUTO: But she didn`t do that.

RENDELL: No, she didn`t.

CAVUTO: And something changed literally 24 hours later. What was it? You? Others? Who? What?


RENDELL: No, I think it was a lot of people who care very deeply about her and who I think she knows care very deeply about her said, look, we`ve got to do this soon, because we`re at a key point here, and we`ve got to bring this party together as quickly as possible.

We gave it our best shot. We had three great months, Neil. We dominated. We got 55 percent of the vote in March, April and May. It`s amazing to me that the superdelegates, in my judgment, picked someone who is not going to be our strongest candidate. He`s going to be a good candidate, but Senator Clinton would have been our strongest candidate.

But, having said that, we took our shot. We did not prevail. The time had come to bring the party together. Again, people who haven`t been in a long campaign, who haven`t felt the attachment to their supporters, don`t really understand what she was going through Tuesday night.

But it was clear that something had to be done, and something had to be done quickly. She made the right decision. I guarantee you, whether she`s on the ticket or not, she`s going to be a fierce, fierce campaigner for Senator Obama, because one thing Hillary Clinton believes in are the issues that she talked about.

CAVUTO: Well, let me ask you, if I`m — if I`m Senator Obama`s, and I`m listening to your last answer there, where you said, you know, he`s not the stronger of the two candidates, I would just scratch Ed Rendell off my running mate list.

RENDELL: Well, I scratch myself.


RENDELL: But, look, the truth is the truth, Neil.

I mean, look, you`re a pretty sagacious analysis — analyst. Look at what`s happened in the last three months. There`s no question, Hillary Clinton has dominated. She won nine out of 14. She won nearly 55 percent of the vote. She won historic margins. Now, that`s to her credit.

But to Barack Obama`s credit is that he ran a great campaign. He and David Axelrod, his political strategists, put a perfect plan together. And there`s something to be said for those who run a good campaign.

CAVUTO: Well, he won. You`re right. He won. It`s over.

But now there was this issue of Hillary Clinton and the way she raised the running mate issue. And — and you had been responding to reporters` questions about how — how she might have misplayed that. I`m being charitable here. You actually were a little more blunt.

RENDELL: Well, you don`t...

CAVUTO: But do you think she screwed up, that, if Obama were entertaining her as a running mate, she — she put that on ice?

RENDELL: I don`t think she put it on ice, but I don`t think it was handled well.

Look, the presidential nominee, everyone agrees, has the absolute right to pick who he or she wants. The presidential nominee, in this case Senator Obama, has to pick someone that he feels comfortable with, that he thinks will help him win, and he thinks will help him govern. There`s no leverage that you could put on the presidential nominee.

And — and I don`t know what was on the mind of either Senator Clinton or her supporters, but you don`t leverage the presidential nominee. You can say...

CAVUTO: So, you say that that had at least the appearance of sort of strong-arming him.

RENDELL: To an extent, and particularly what was done by her supporters, more so than what was done by Hillary, the petition drive, things like that.

Look, Barack Obama is as smart as it gets. He knows the assets that Hillary Clinton would bring to the campaign.

CAVUTO: And he knows, as well, that, if he were to pick her, Governor — and you know the system better than I do — it would look like he was backed into it, strong-armed into it, or a wuss, if he did do it.

RENDELL: Well, if he picked her right away, in response to all of this.

I think he`s got to go through a process. He`s got to look at other candidates. But let me also say, Neil, he has to sit down with Senator Clinton at some time, just the two of them, no advisers, no staff, talk about it, to see if they can become comfortable with each other.

CAVUTO: But does he have to do something for her? I mean...

RENDELL: No. To win? Absolutely not.

CAVUTO: Really? Does there have — there`s — so, you don`t think there`s going to be any deal made or any promise eventually of a Supreme Court position...


CAVUTO: ... or anything like that?

RENDELL: I think they will try to explore whether they`re a compatible team. If Barack Obama comes to the conclusion that they are, and that the upside is — is strong enough to persuade him to do it, I think he will pick her. But...

CAVUTO: If you were advising him right now, Governor, would you say, pick Hillary Clinton?

RENDELL: If he feels comfortable with her as a running mate and as someone running the government, she is clearly the best political asset to the ticket.

Neil, I think there are two characteristics for a vice president. One, is that candidate for vice president going to help you in the election? Clearly, Hillary Clinton gives Barack Obama that most help.

Two, is that candidate ready for president? And I don`t think anybody could suggest that Hillary Clinton is not ready to serve.

CAVUTO: Well, you know, Governor, you could turn that around. I mean, there are many who are debating whether she does bring that much more to the ticket.

And they look at you and they say, you know, Rendell, Pennsylvania`s always kind of dicey, loosey-goosey. He could deliver Pennsylvania, a state rich in electoral votes.

What do you say?

RENDELL: Well, but so could Hillary Clinton. And she could deliver a lot more...

CAVUTO: I`m done with Hillary. I`m done — I`m on Ed Rendell now.

RENDELL: Oh, me?

Neil, in this lifetime, you have to know yourself. At the age of 32, I became my own boss. I was elected district attorney in an election that nobody thought I could win. I have been my own boss for 32 years. I`m not a number-two guy. I don`t stay on message. I don`t spin.


RENDELL: I say what I believe. I am not constitutionally correct. And my constitution...

CAVUTO: A lot of number-two guys, Governor, have become number-one guys.

RENDELL: Yes, but you have to be a good, loyal number-two guy first.

And that`s not for me, and there are a lot of things I want to do here in Pennsylvania.

CAVUTO: You were very loyal to Hillary Clinton throughout.

RENDELL: Oh, sure.

CAVUTO: You stayed and stuck by her side when nobody was.

RENDELL: And I will be loyal to Barack Obama, and we will carry Pennsylvania without me on the ticket.

CAVUTO: But what about all these supporters of hers who are saying, we`re jumping to John McCain?

RENDELL: Well, I understand their frustration, but it`s a long way. It`s almost six months to the election. And those people care about the makeup of the Supreme Court. They care about education. They care about health care, and they`re going to calm down, and they`re going to realize that Barack Obama is...

CAVUTO: Well, they`re not calming down, Governor, with all due respect.

RENDELL: Not yet. Not yet.

CAVUTO: Maybe you`re right. Maybe time — but on this running mate stuff — if you don`t mind my being rude — final decision here.


CAVUTO: You`re on a short list. Every short list I see, your name`s on it. Are you saying scratch your name off?

RENDELL: Yes. I would be a terrible number two.


RENDELL: Plus the fact, Neil, everyone says, we like governors.

But governors, with the exception of Governor Richardson, have one also significant failing. We don`t have a lot of hands-on foreign affairs experience. We don`t. We have a little bit of trade experience, but not hands-on foreign affairs experience.

If Senator Obama asked me — and it`s unlikely that he will, all right, — if he were to ask me...

CAVUTO: Not after this interview, but go ahead.

RENDELL: That`s right.

CAVUTO: Kidding.

RENDELL: I have done away with it.

But, if he were to ask me, I would say, Senator Clinton first, if you guys can work it out.

If not, I would say someone like a Joe Biden, with tremendous foreign policy experience, tremendous terrorism experience...

CAVUTO: All right.

RENDELL: ... a good campaigner, somebody who would mesh very well with Senator Obama.


RENDELL: It`s not that I`m not an ambitious guy. I am, like all politicians. But you have got, to your own self, be true. It wouldn`t be a good job for me.

Plus, I actually — I know people don`t believe this — I love my job. I love my job.

CAVUTO: Well, apparently, judging from your popularity numbers in the state, your constituents agree.

Governor, very good having you. Thank you very much.

RENDELL: Thanks, Neil. Have a great day.

CAVUTO: Governor Ed Rendell.

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