Updated

This is a rush transcript from "On the Record," June 1, 2011. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: South Carolina's Nikki Haley, the governor is taking on Secretary Napolitano. Why? In South Carolina some businesses use E-verify to review workers immigration status. Governor Haley wants state officials to check up on businesses to make sure they are complying. The DHS says no. Governor Haley sent a harsh letter to Secretary Napolitano to push her to permit state investigators to access the e-verify documents. Governor Nikki Haley joins us now. Good evening, Governor.

GOV. NIKKI HALEY, R-S.C.: Hi, Greta, how are you?

VAN SUSTEREN: I'm very well. I have a copy of this letter that you sent to Secretary of Homeland Security Janet Napolitano. In the first paragraph you make it clear you tried to contact her a number of times. You say you are disappointed she not responding. What's up?

HALEY: I think she owes me a response. My labor secretary was told the end of April we could not enforce our legal immigration laws. We got on the phone with secretary Napolitano's office. We've repeatedly made phone calls, and the Obama administration did not respond.

So I sent a letter and went public Friday and said we have immigration laws for a reason South Carolina takes illegal immigration seriously let us enforce our laws. We to use this E-verify system, and I need the federal government to get out of the way. They have gotten in the way when it comes to health care, unions, and which companies can create jobs in South Carolina. Now they are getting in the way with the fact that I'm trying to govern a state, enforce illegal immigration, and they are keeping me from doing it. It has to stop and I'm calling them out on it.

VAN SUSTEREN: Also in Arizona another immigration law, the way they fought Arizona whether it is constitutional or not will be determined by the Supreme Court. They said immigration was a national issue. And they very much wanted Arizona to get out of it. To the extent they are not helping you enforce their law is curious.

HALEY: President Obama is saying he's taking illegal immigration seriously. But it's his administration that is stopping us from enforcing it. And saying one thing and doing another is the problem we've had with this administration in the beginning.

I'm trying to govern a state and manage my state and lead it in a positive direction. He continues to stop it every step of the way when it comes to good policy. We are not going to be quiet about it. This is something we take seriously in South Carolina. I'm going to be loud about it. I need to enforce legal immigrants in South Carolina and make sure our businesses are handling that accordingly. They owe South Carolina a response as to why they are keeping us from doing that.

VAN SUSTEREN: Besides the issue of whether it is against the law or not, why does it make a difference to you as governor if there are the -- if there are illegal workers in the state? What is the real impact on South Carolina now?

HALEY: Well, you have to go back to the heart of the principle of this country. I'm the daughter of immigrant parents. They came here legally. They paid their time, they paid their price. They are offended by those that come here illegally.

We are a country of laws. When we give up being a country of laws we are giving up everything this country is founded on. We have to make sure people come here properly. That our businesses are hiring citizens are making sure they have work visas. We cannot allow any illegal immigrants in our state or country. We have to stand behind what we say. We have to enforce it. That's what my labor secretary is trying to do. That's what my administration has required her to do. And that's what President Obama is stopping.

VAN SUSTEREN: It seems there are two issues. One, you ought to be able to communicate with the federal government on an issue like this. Secretary Napolitano and the administration should get back to you. I see in your letter it is replete with examples of what you tried to do. Second, you want to use this e-verify system to check up on businesses. Do you not have other means to do that?

HALEY: E-verify is a credible way of checking for verification for illegal immigrants. Let's be clear. I'm not asking for date of birth. I'm not asking for numbers or identifying that would compromise these people. What we would are saying is show us the e-verify summary for last name only if you tell me you hired Douglas Walker and Smith, show me the summary sheet that says you e-verified them.

And that's what Homeland Security is not allowing. That guess to the heart of making sure businesses are doing what we tell them to do. That's why immigration reform is important, not just in South Carolina, but across this country, because, we are forced to pay for the education of these illegal immigrants, forced to pay for health care through the federal mandates. We can't continue to pay for something we don't want. We are to allow us to enforce the issues so we can have them go somewhere else and not in South Carolina.

VAN SUSTEREN: Does the Department of Homeland Security make sure they are legal or illegal? Are they checking up on this?

HALEY: They are not. We haven't heard anything from them. After I made my comments Friday and made repeated calls many we sent this letter. And suddenly Secretary Napolitano says she would call us back tomorrow. We are glad she is going to do that. Either way we have to make sure states have the ability to enforce their laws. None of the states would have to do this if the federal government was doing their job in securing the borders.

VAN SUSTEREN: I take it you are not going to give up?

HALEY: I am never going to give up.

VAN SUSTEREN: Thank you. I look forward to finding out how your telephone call is with Secretary Napolitano. I hope she calls tomorrow.

HALEY: Thank you.

VAN SUSTEREN: Thank you, governor.