This is a partial transcript from "Hannity & Colmes," February 28, 2007, that has been edited for clarity.

SEAN HANNITY, CO-HOST: It has been more than two years since John Kerry lost his bid for the presidency. And despite initial rumblings that he might try again, Kerry has decided to sit it out in 2008. But if you were wondering whether or not Kerry was bitter and angry over his defeat, well, wonder no more.

Yesterday, Senator Kerry went after Sam Fox. Now, that's the Bush administration nominee for the ambassador to Belgium. This was during a Senate Foreign Relations Committee hearing. What was Kerry's problem with the nominee? Well, it was that he had legally donated money to the Swift Boat Veterans for Truth during the 2004 campaign.

Take a look at Kerry's badgering of the nominee.


SEN. JOHN KERRY, D-M.A.: 527, as you said, is mean and

ugly and not accountable.

SAM FOX, AMBASSADOR NOMINEE: I agree with that. I absolutely agree

with that. And I...

KERRY: Why would you give $50,000 to a group that you have no sense

of accountability for?

FOX: Well, because if 527s were banned, then it's banned for both parties. And so long as they're not banned...

KERRY: So two wrongs make a right?

FOX: Well, I don't know, but if one side is contributing, the


KERRY: But is that your judgment? Is that your judgment that you would bring to the ambassadorship, two wrongs make a right? You nevertheless contribute to that very group that is smearing and spreading lies.

FOX: Yes, sir, all of the 527s were smearing lies and...

KERRY: So you see no responsibility, as an individual citizen, to try to guarantee that you're not going to support that kind of politics of personal destruction?


HANNITY: So are you wondering if Senator Kerry is bitter? Joining us now is the man who created the Swift Boat Veterans for Truth, John O'Neill is back with us.

John, first of all, your reaction to the overreaction and this real bitterness of Senator Kerry?

JOHN O'NEILL, SWIFT BOAT VETERANS FOR TRUTH: Sean, he just won't let it go. You know, he spent 37 years obsessed with three-and-a-half months in Vietnam. Everybody else went about their business, had jobs, you know, did other things. Our kids didn't even know we were there. You can see it again the same way.

But the retaliation by Kerry follows a very — a pattern that's gone on ever since the election. They went and picketed my home during my daughter's wedding.

Kerry's commanding officer in Vietnam was a Captain George Elliott. Immediately before — while his wife had cancer, he received an e-mail, she did, wishing, hoping that she died. She did die three weeks later. He really should be ashamed for what he's done.

HANNITY: Well, I want to ask you this, because you talk about the politics of personal destruction. Clearly, you're the victim of this here.

More importantly, you know, here's a guy that's up for a position. He has a different political point of view. Now, my take is that, if the real liar, the person that really smeared individuals, well, that was John Kerry. John Kerry smeared the good character, the good name of Vietnam vets like yourself, and he lied about them, and he made accusations that they were murderers, and that they were terrorizing people, and cutting off head and arms and limbs, et cetera.

We don't have to rehash all of it here, but it seems to me it's John Kerry. But the important question is here, because somebody dared to disagree with him, donate money to a campaign that was against him from president, he now is using his position, or misusing his position, to take revenge. Is that what you saw in this?

O'NEILL: Exactly. We had 155,000 people, Sean, who donated money to us; 7,000 or 8,000 of them were actually people on active duty in Iraq. Their names are all listed. What, they're all not qualified anymore to serve in the United States government? And when did he ever apologize to the wives and the mothers of the people that he labeled the army of Genghis Khan?

HANNITY: Absolutely. Well, and I think this is really, really important, if we're going to get to the bottom of whether or not Kerry is allowed to use or misuse his position here.

But what's happening here is the term swift boat. We're not going to allow ourselves to be "swift boated," as is being used in even this campaign, even by Hillary Clinton. "I'm not going to be swift boated." But yet she says she'll deck her opponents or anybody she disagrees with here.

I want you to address this, because the people, the Swift Boat Vets for Truth, they're American heroes. They served their country. They risked their lives. They were unfairly attacked by people like Kerry. Their characters were assassinated.

And yet somehow there's this general misuse of the term "swift boat" to act as though this is a smear campaign.

O'NEILL: There were 294 of us that signed the letter, Sean. Sixty to seventy of them were wounded in Vietnam, some very seriously. Many of them served directly with Kerry.

There were also POWs. They included two POWs, Leo Thoris (ph) and others, who won the Congressional Medal of Honor in Vietnam, that came forward very honestly, 10 or more of them, appeared on your show. I counted the number who were actually in Vietnam with Kerry on operations.

They spoke fairly, freely. None of them have ever gotten a dime for what they said; nobody has any job with the government. They came forward because they were American citizens, and they thought people had a right to know. I think they did.

HANNITY: What do you plan to do next? Do you plan any reaction, response to Senator Kerry's actions here?

O'NEILL: Not really, Sean. We believe that he's now a part of the past and it's for history. What we've worked really hard on is on relief relating to Iraq veterans. And what we have done is raise and distribute a great deal of money for the family of very badly wounded Iraq veterans. That's we what we've been working on principally...


ALAN COLMES, CO-HOST: Mr. O'Neill, this is Alan Colmes. You know, you're the one who's on this show once again blasting Kerry. You're the one who can't let go.

HANNITY: We invited him.

COLMES: And I'd like to point out, John Kerry is not responsible if someone sends a nasty e-mail to somebody or pickets somebody's house. You blamed John Kerry earlier in this segment for those actions. What did John Kerry have to do with it?

O'NEILL: Well, let me tell you what happened. Actually, they first picketed our old house, where we didn't live anymore.

COLMES: John Kerry did?

O'NEILL: No, his group.

COLMES: Did he have anything to do with it?

O'NEILL: Then they picketed my house. Let me tell what happened. We then picketed his house...

COLMES: Good for you.

O'NEILL: ... his two mansions on Beacon Hill in Georgetown. You know what happened? All the picketing stopped as soon as his house got picketed.

COLMES: You're blaming him for something he can't control.

O'NEILL: I think he had a lot to do with it. Oh, I think he controlled it.


COLMES: You've been discredited. William Rood, the only officer present — again, you're rehashing all of this, so I'm going to bring it up again. William Rood, the only officer present, says that what you've said was wrong. George Elliott changed his story a number of times. Jim Rassman, the man who actually was saved, his life was saved by John Kerry, says you're wrong. You've been discredited by the people who were actually there and the person whose life was saved by John Kerry.

O'NEILL: More than 11 people who were there on the operations appeared on this show and talked to you, Alan Colmes. You listened to them.

COLMES: They weren't on his boat. They weren't the people on his boat.

O'NEILL: They were on his boat.

COLMES: And the only officer there...

O'NEILL: Steve Gardner was on his boat.

COLMES: ... was William Rood, and he's discredited you, sir.

O'NEILL: Steve Gardner was on his boat. He appeared right on this show with you. You listened to 11 people. They were naval officers and retired Navy guys. None of them made a dime. They had nothing to gain. And what you've done is go to a few isolated people, the tiny number....


COLMES: No, it's quite the other way around. You've chosen isolated people and taken them out of context. You've quoted people like George Elliott, who changed his story twice. And you're here, once again, smearing John Kerry. You just can't let go.

O'NEILL: John Kerry threatened a contributor with retaliation on the record in a Senate deal.

COLMES: What retaliation did John Kerry — you know, John Kerry could put a stop to this nomination. Has he done so?

O'NEILL: Didn't you listen to it? Yes, he said he was. That's exactly what he said he intended to do.

COLMES: But he hasn't done it, has he?

O'NEILL: Oh, well, we'll see if he does or he doesn't.

COLMES: You're accusing him of retaliation. There's been no retaliation yet, has there?

O'NEILL: That wasn't a threat that we all listened to just now at the beginning of this segment?

COLMES: What was the threat? What has John Kerry done, other than ask him some tough questions?

O'NEILL: Did you contribute money? Can you imagine how I feel about that? Do you know how I feel about that?

COLMES: How is that a threat?

O'NEILL: Are you going to apologize? Listen, we all know what that is, Alan. And you know what that is.

COLMES: Where was the threat, sir? I didn't hear a threat. Tell me what the threat was.

O'NEILL: I did. I heard it. But the American people listened to it, Alan. They listened to John Kerry with respect to our kids in Iraq, when he said they were stuck there because they hadn't studied hard enough. I mean, people have heard it.


COLMES: Mr. Fox, by the way, who John Kerry was questioning, just referred to John Kerry as a hero. Do you agree with your contributor, Mr. Fox, who said that?

O'NEILL: Mr. Fox and 155,000 other people, but, no, the great heroes we had, Alan, are all back in Vietnam. They all died there. I think if you talk to the people in our unit, you would find that we believe those are the great heroes we had. And I think you'd find also that most of us don't live on our experience there like Kerry does.

HANNITY: I don't know if George Bush would have won re-election but for you guys telling the truth. And as far as I'm concerned, you're all heroes. John O'Neill, you're a great American. Thank you for being with us.

O'NEILL: Thank you, Sean.

Watch "Hannity & Colmes" weeknights at 9 p.m. ET!

Copy: Content and Programming Copyright 2007 Fox News Network, LLC. ALL RIGHTS RESERVED. Transcription Copyright 2007 Voxant, Inc. (www.voxant.com), which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon Fox News Network, LLC'S and Voxant, Inc.'s copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.