This is a rush transcript from "Special Report," February 10, 2014. This copy may not be in its final form and may be updated.
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JAMES PINKERTON, REPUBLICAN STRATEGIST: This is the real Hillary in terms of the way she was talking and thinking and acting. This is her close friend. Frankly, it sounds like her. This is a window into her world including the Packwood matter.
DOUGLAS SCHOEN, FORMER CLINTON CAMPAIGN ADVISER: I don't think it is relevant to the political dialogue or debate today, nor do I think it will have much bearing on Secretary Clinton's prospective or possible run for president.
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BRET BAIER, ANCHOR: Well, they're talking about papers released by Diane Blair, close friend of Hillary Clinton, then first lady. Some of the things coming out in these papers talk about the revelations and her thoughts around the affair with Monica Lewinsky. Here is one from these papers. Quote, "It was a lapse, but she says, to his credit," she being Hillary Clinton, "he tried to break it off. Bill Clinton tried to break it off, tried to pull away, tried to manage someone who was clearly a narcissistic loony-toon, but it was beyond control." Another one, "HRC [Hillary Rodham Clinton] insists no matter what people say, it was gross and inappropriate behavior, but it was consensual, not a power relationship. It was not sex within any stand up, lie-down, oral, et cetera, of the term." And they continue as these papers come out.
Let's bring in our panel tonight, Ron Fournier, senior political columnist of National Journal, Nina Easton, columnist for Fortune magazine, and syndicated columnist Charles Krauthammer, author of the best- selling book "Things that Matter." Ron, what do you think? There's a lot of stuff here James Rosen detailed in this piece we did earlier. Your thoughts on this?
RON FOURNIER, NATIONAL JOURNAL: First, I knew Diane Blair. I covered the Clintons in Arkansas when he was governor, and she was wicked smart, real decent person, probably one of the people around Hillary who was the most real, someone who helped keep her grounded, who helped her transition to Arkansas.
My first impression was this blew up against Republicans in '98, it didn't get the president. He left office more popular than when he came in. But the more I thought about it, anybody under 35, this is new to them. Second of all, Hillary Clinton in 2016 has to be Bill herself, like any presidential candidate, about the future. This brings us back to the past. You don't want the word "archive" associated with your presidential race.
BAIER: At the same time, Nina, this comes as Senator Rand Paul has been asked numerous times about a statement that his wife made about Bill Clinton. And he has now expanded on that a number of different ways. One of them was on C-SPAN, take a listen.
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SEN. RAND PAUL, (R) KENTUCKY: Senator McCaskill needs to remember what she had to say about Bill Clinton, that she wouldn't want her daughter in the same room with him. So they can't have it both ways. Democrats can't say, we're the great defenders of women's rights in the workplace and we will defend you against some kind of abusive boss that uses their position of authority to take advantage of a young woman when the leader of their party, the leading fundraiser in the country is Bill Clinton, who was a perpetrator of that kind of sexual harassment.
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NINA EASTON, COLUMNIST, FORTUNE MAGAZINE: Well, keep in mind, Rand Paul is a leading prospective Republican presidential candidate in 2016 and he's tapped into the imagination of a lot of folks. And he's very cleverly remembered that Bill Clinton was a liability to Hillary during 2012. That hurt him. So he's trying to make the conversation more about Bill and Bill's behavior, as of course these papers feed that.
But the whole Clinton story, as Ron know, is complicated, and the Hillary story is complicated. The papers also show and reveal Hillary Clinton as quite a bulldog on health care reform. She really took the co-presidency thing seriously and she complained -- talked about whiners -- she complained about the whiners in the White House who weren't tough enough and mean enough and wouldn't go gung ho on pushing health care reform. And she lost a lot of favorability after that. But keep in mind, she also came back. She went to New York State with humility and tenaciousness and got people in a state where she didn't even really live to vote for her, and she gained a lot of credibility as a senator from New York. So her story in the American imagination and American psyche is a long, complex story.
BAIER: I should point out, these are Blair's papers released from the University of Arkansas in 2010 after her death, and reporters now just going through all of them.
CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Well, as her star is rising, as she looks to be the presumptive nominee, this is really a trove for people to go back and look at. The idea that Hillary is ruthless is not news. But there is, you know, the extent of that in the papers here is quite remarkable, there is one case referred to where she strongly opposes a nominee, a potential nominee for the Supreme Court, and she opposes him in order to punish a friend of this perspective nominee who is the publisher of an Arkansas paper that had been running a lot of negative stories on the Clintons. So that's kind of, you know, a two-cushion revenge story. That's impressive.
I think what Rand Paul is doing, as Nina indicates, there's a subtle change. He started by attacking Hillary as a kind of an enabler. You get a Clinton, they act together. Now I think he understands that not a smart way to go about it. Attack Bill as the guy who raises the funds and try to embarrass the Democrats over the hypocrisy on the women's issue. I think that's a smarter tactic.
BAIER: Meanwhile, Bill Clinton says he's going to go to Kentucky and is going to campaign down in Kentucky for the Democrat there.
KRAUTHAMMER: I'm not sure that Rand's public attacks on Bill have had an appreciative effect on his popularity, which remains astronomical.
BAIER: At the same time, Ron, another book is quoting another former general, now still a general, but General Petraeus, former CIA director, saying this, "Like a lot of great leaders, her," Hillary Clinton's "most impressive qualities were most visible during tough times. In the wake of the Benghazi attacks, for example, she was extraordinarily resolute, determined, and controlled." And he continues later in the interview "She would be a tremendous president." So supporters are pointing to General David Petraeus.
FOURNIER: I think that's a wonderful thing for David Petraeus to do if he wants to be in the administration if she wins the presidency. That's what that's about. That's a job application there.
BAIER: That's how you read it?
FOURNIER: The fact of the matter, on Benghazi, set aside for a second all the conspiracy theories and a lot of things that didn't prove to be right. We do know that security was terrible. And that is on her, on her administration. She was ultimately responsible for that. And we do know that the explanation immediately after the attack was distorted and not accurate, and she owns that. So that is Benghazi, whether she likes it or not is going to be part, not all, but part of her legacy and a reflection of her leadership.
EASTON: I would say Benghazi, the root of that story is underestimating the terrorist threat. And as we know, the terrorist threat has only increased in that region in Syria and Iraq. And I would say, particularly if there is any kind of attack on us or western interests, that this is something that will come back to haunt her.
KRAUTHAMMER: Well, you know, Petraeus is an American hero, but his role in Benghazi -- it's a complicated one, because he did tell the Congress in secret testimony that he stretched a lot the video story, while he says that he knew it was a terror attack from the very beginning. So which is it? There's a lot of sort of contradictory stuff.
So I would agree with Ron. I think that what he said about Hillary ought to be taken with a grain of salt, because after all, the fact that he stressed the effact of the video, which we now know was not in any way contributory, is a way to soften the blow on the State Department. Which is why Victoria Nuland tried to soften it as well. So I think it was a way to make himself a little more persona grata with the Clintons.
BAIER: Last word here Ron, do you think all of this combined is going to have an effect if she decides to run in 2016? There's going to be a book apparently this summer in her own words about her time as secretary of state.
FOURNIER: Yeah, obviously, her record and the complicated relationship with her husband and everything from Arkansas is going to be part of the campaign. Do I think it will be dominant? Probably not. I think I'm more interested in finding out if she does run, first of all, what her message is going to be, what her policies are going to be. She has been off the radar for the last few years politically. So she's going to have to deal with this stuff, but it doesn't necessarily weigh either way, I don't think.
EASTON: And I would just add that a pairing of her and Rand Paul in a general election would upend political alliances and would be fascinating.
FOURNIER: That would be a heck of a race.
BAIER: Next up, another delay for ObamaCare.
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