Updated

This is a rush transcript from "The O'Reilly Factor," January 5, 2009. This copy may not be in its final form and may be updated.

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BILL O'REILLY, HOST: In the "Impact" segment tonight: 2009 may become known as the year of the scandal.

As we mentioned, Governor Richardson of New Mexico may be in big trouble. And Governor Blagojevich of Illinois has already been arrested. That didn't stop Blagojevich from appointing Roland Burris to take Barack Obama's place in the Senate. However, some Democrats trying to block Burris from taking the job, and now charges of racism are in the air.

(BEGIN VIDEO CLIP)

REP. BOBBY RUSH, D-ILL.: You know, the recent history of our nation has shown us sometimes there can be individuals and there can be situations where school — where you have officials standing in the doorway of school children. You know, I'm talking about — back in 1957 in Little Rock, Arkansas. I'm talking about George Wallace, Bull Connors. And I'm sure that the U.S. Senate don't want to see themselves placed in the same position.

(END VIDEO CLIP)

O'REILLY: All right. So that's Democrats fighting Democrats there with Congressman Bobby Rush, who had a throat cancer, which is why his speech is a little halting. The speech is halting but stupid, with all due respect to the congressman. Joining us from Washington, FOX News analysts Juan Williams and Mary Katharine Ham.

There's no racism involved in this. It's just a matter of procedure.

Click here to watch the segment.

JUAN WILLIAMS, FOX NEWS CONTRIBUTOR: Absolutely.

O'REILLY: If the feds are saying that Blagojevich tried to sell the Senate seat and there's impeachment underway for him, the governor in Illinois, I mean, got to question the Senate seat. So you don't see racism here, do you?

WILLIAMS: No. I mean, to me, this is such a cynical play by Governor Blagojevich. He is absolutely using racial politics to divert attention he away from his own alleged corruption. He's not indicted yet, but I mean…

O'REILLY: But you say he's using a black man, Burris, who I believe is qualified to be a senator.

WILLIAMS: Absolutely. I don't know if he's qualified.

O'REILLY: I do. I think he is.

WILLIAMS: Well, I tell you what. He's not — he hasn't won statewide in Illinois.

O'REILLY: No, but he's a former attorney general, you know, public servant.

WILLIAMS: And he's a former controller. I'm saying he — when he tried to move to be governor of Illinois, he couldn't get it. He's tried. He's showed an interest in being a senator from Illinois. And the voters haven't backed him. So what you see here is Blagojevich using the race card, even using it against Harry Reid in the U.S. Senate saying that Harry Reid is trying to block black people.

O'REILLY: Wow.

WILLIAMS: Now he's got Bobby Rush.

O'REILLY: So to protect his own…

WILLIAMS: By the way, Bobby Rush should know better. Bobby Rush is the one guy who can say he beat Barack Obama in a political race. In the age of Obama, this play is so transparently the race card.

O'REILLY: Wow. So if that's true, if Blagojevich is trying to incite racial hatred to protect his butt, that's just despicable. So we — it's speculation. But you know, Juan…

WILLIAMS: Yes?

O'REILLY: …has a strong point of view on it.

WILLIAMS: You watch those jurors. Are they going to be black? He knows there are going to be black jurors in Chicago.

O'REILLY: All right. Now, Mary Katharine, we got Richardson, who we have no respect for here, and I'll tell the audience straight up. We treated Governor Richardson very well on the FOX News Channel respectfully for years. And then when the debates came along, he boycotted FOX News. We think he's a weasel. We watched as he turned on his friend Hillary Clinton for — as an opportunist to try to curry favor with Barack Obama. And now so I just want everybody to know that I have no respect for the governor. And I think he is, you know, what you see is what you get. And you might see a guy in handcuffs.

MARY KATHARINE HAM: All that butt kissing for naught, it seems. I mean, I was reading — the Politico the other day referred to the Obama transition's exceedingly smooth public face up until this point. And I think, you know, they've got a smooth face like a high school marching band without a dermatologist. I mean, this is ridiculous at this point. And I think that Obama actually has brought some of it on himself by his tendency to inaction.

O'REILLY: Well, where was the vetting? We ought to — we heard about Palin…

HAM: Right.

O'REILLY: ...and the vetting. Where was the vetting?

HAM: Right, two things…

O'REILLY: It takes two seconds and all of a sudden the whole state is falling apart because they may have given this California outfit $1.2 million contract for play for pay.

HAM: Right, and on — not only that, Bill, but on the Burris issue, had Obama come out and reiterated what he sort of hinted that he was for a special election, which would have been a really fair way to do this. But Chicago Democrats, of course, didn't want to do it or Illinois Democrats didn't want it to do it that way because they thought they might lose. He didn't come out and say listen, guys, let's get this done fairly and make it happen. He stood back and he looked cool like he always does. And he's run into this problem where the Senate is going to end up looking bad either way, because…

O'REILLY: Well, it has not been a…

HAM: ...there is a racial component here. And there's some bad optics here from blocking him.

O'REILLY: Not been a good two months for the Democrats or Barack Obama.

And finally our pal Al Franken who, if you had to pick between Richardson and Franken, you would pick Richardson. Richardson is like St. Peter compared to Franken, who you don't get any lower than that man, Franken. You don't. That's the worst thing I've ever seen in American politics is this man may becoming a senator. It's personal with me. He's lied about me. He's slandered me, but he's done it to many, many other people. Now, Coleman's going to sue. And did you read The Wall Street Journal thing — article today, Juan? It's pretty good that this thing is totally dishonest, this recount.

WILLIAMS: Now, Mary Katharine told me some things in the green room, but let me just say this. If you look at The Wall Street Journal article, it does call into question what kind of level playing field we've had for the recount. But you got to take this into account. I think that the voters of Minnesota have to be held responsible to some extent. They're the ones that made this close.

O'REILLY: But more than 300,000 voted against Franken, who voted for Barack Obama. So I'm not going to condemn the state. There are far-left loons in Minnesota. We know that. The state is very polarized in that regard.

WILLIAMS: Right.

O'REILLY: Republican governor. But any — Franken, the fact that he was even competitive, Mary Katharine, depresses me about America.

HAM: Yes. Look, I don't like the idea of a Senator Franken any more than you do. And frankly, I don't think there are some Democratic senators who like it that much because they think it's going to open the flood gates to guys like this in the future. But the deal in Minnesota is this, is that I'm talking to a friend of mine who's been covering very closely at The Weekly Standard and he's a conservative and he finds that the whole thing has been a very open process, that the discrepancies are certainly there, and they're unfair but they're rather small and probably not militias. And there's another whole step here where Coleman gets to file for lawsuits.

O'REILLY: Yes, there are going to be lawsuits.

HAM: And he's allowed to do that under law.

O'REILLY: Right.

HAM: And it's the fair way to do it. There's one more step.

O'REILLY: OK, guys, thanks a lot. Happy New Year. Nice to see you.

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