This is a rush transcript from "Hannity," February 24, 2009. This copy may not be in its final form and may be updated.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I know there are some in this chamber and watching at home who are skeptical of whether this plan will work, and I understand that skepticism. Here in Washington, we've all seen how quickly good intentions can turn into broken promises and wasteful spending, and with a plan of this scale comes enormous responsibility to get it right.


SEAN HANNITY, HOST: And that was President Obama, delivering his remarks to a joint session of Congress just a bit ago. And joining us now to give us his thoughts on the president's speech is Democratic Congressman Joe Sestak is with us.

You know, Congressman Sestak, I'm getting a little frustrated. He said in last week's $1 trillion plus with interest, you know, massive spending bill. He said there were no pet projects in it. We all know that's not true.

Video: Watch Sean's interview with Rep. Sestak

I have a list of the $410 billion omnibus spending bill. I have a list — I'll start reading it to you, if you like — of nothing but part of the 9,000 earmarks. How can you say with a straight face that this is not irresponsible spending when it's full of earmarks? Last week's bill, this week's bill being debated. Explain that to me. You're a Democrat. Help me out.

REP. JOE SESTAK (D), PENNSYLVANIA: Absolutely. Sean, first off, you try to name me one — one in the recovery bill of an earmark.

HANNITY: I got it. I got it. Answer.

SESTAK: Now, with 9,000 earmarks in this omnibus bill —

HANNITY: The marsh mouse that gets $30 million. The railway from Los Angeles to Las Vegas, that is a pork project...

SESTAK: Sean, those words are absolutely not in the bill, and you know it. You may be reading them off the Internet, but those words are not in the bill.

HANNITY: Of course, because you hide it. But we know where the money's going. It's just like for example...

SESTAK: Now, Sean, those words — Sean, if I could. Sean, you're reading off an Internet fact thing. You've got to read the actual bill. And I've read every word.

HANNITY: You know...

SESTAK: Let's talk about the 9,000 earmarks.

HANNITY: Wait a minute. You know and I know that Nancy Pelosi's district, that these marshlands to help save the mouse, that's where that money's going. This railway for Harry Reid, these all-terrain vehicle trails, they're in the bill, Congressman. We are spending $1.3 trillion of our kids' money. Why?

SESTAK: Sean, I just don't want to mislead the public. Those words are not in the bill.

HANNITY: But the money is earmarked for it.

SESTAK: No, there are not, Sean.

HANNITY: You sound like Bill Clinton.

SESTAK: No, I'm just telling you what the facts are.

HANNITY: "I did not have sex with that woman." That is where the money is going, Congressman. Be straight with the American people.

SESTAK: Sean, let's go to a more important topic, please. Let's talk about the earmarks that you bring into the omnibus bill, which we're going to pass.

As you know, when I went to Congress two years ago, I voted for pay as you go governement, and we actually cut, from the year before, down to 45 percent of the previous total amount of money of the earmarks.

Now we cut them another 5 percent. I'd vote in a heartbeat for no earmarks.

But let's go to the overall picture of the money. I think I take President Reagan as one of my models, back in the '80s, when we had the S&L crisis. And what he did was put 3 percent of the federal — of the GDP by federal money into the S&L in order to purchase those types of S&Ls to salvage our economy.

Now, we're doing a bit more, because we're in a much more desperate type of situation.

HANNITY: No, no, no. We're not in a more desperate situation. Reagan had 21.5 percent interest rates. Reagan had double-digit inflation. Reagan had double-digit unemployment. We just lost 10 million new jobs. It was far worse then, and he lowered taxes.

Now Congressman, you've got to be straight with the American people. Are you going to look in that camera where you are right now and tell them there's no reckless earmarks in the omnibus bill this week? There's no reckless earmarks in the bill that was passed in last week, no pet projects? Are you going to say that with a straight face?

SESTAK: I will tell you with a straight face that, in the bill, the recovery bill, there was not one earmark. I will tell you that in this bill there were earmarks. Do I want to have none? Yes. I'd like to have none. But cutting by over 50 percent, I think we did a pretty darn good job.

HANNITY: You passed — but you pass a bill — are you going to tell America tonight that that mouse isn't going to get a dime in San Francisco, that that — that that project is not going to happen? You’re going to tell American people that's not going to happen?

SESTAK: Sean, I believe that — that it shouldn't get one because the world is...

HANNITY: I didn't ask that. It's in there because it's for the harvest marsh mouse. The money is going to the marsh to save the mouse.

SESTAK: Sean, I can't be an ideologue. I'd have to be a pragmatic individual. So what I've done is this. I've looked at the models. And what I know from this bill that we have passed, the recovery bill, that if it had not passed between today and the end of June three million more Americans would have been laid off, and by December, we would have 12 to 13 percent unemployment.

And Sean, you know 11 percent marks the beginning of a recession — depression, so what we've done is taken very firm, bold action. And, you know, we're going to stop the hemorrhaging of jobs, get the credit going again and get this economy working.

HANNITY: I don't mind that you support this massive, huge, earmark, pet project bill, but we've got to have honesty. And I want you to — you cannot tell the American people tonight that there's no earmarks in last week's bill. And you can't dispute that there are now, as of this moment, 9,000 plus earmarks thereabouts in the omnibus bill. And you can't tell me that's good for the country. That's good for politicians for their power. But it's not good for the country, is it?

SESTAK: Sean, I don't mind having a disagreement on what's in a bill or not. But as far as honesty for me, let me just repeat again. Those words that you read out are not in the recovery bill.

HANNITY: And you promise the American people…

SESTAK: No. 2, are there earmarks? I admit there's earmarks. But remember, we've got them by 45 percent, and I've moved to zero. But remember this: we are in a financial storm.

HANNITY: I've got that.

SESTAK: If we had not intervened, like President Reagan had or the Great Depression, we would not be coming out of...

HANNITY: Reagan cut taxes. Morgenthau, the treasury secretary of FDR said all that spending didn't help. But I would rather...

SESTAK: So did President Obama cut taxes for 95 percent of all Americans.

HANNITY: Oh, stop it. Stop it.

SESTAK: And President Roosevelt brought unemployment from 27 to and 9.5 percent by 1937.


SESTAK: Thanks for having me.

HANNITY: You're a great American. I've got a lot of work to do on you, Congressman. We're going to bring you back.

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