This is a rush transcript from "Hannity," May 20, 2010. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: Connecticut attorney general and Democratic Senate candidate Richard Blumenthal is paying the price for lying about his military service. It has been just four days since The New York Times exposed that Blumenthal never actually served in Vietnam as he claimed.

And for this he has already taken a pretty big hit in the polls. Now two weeks ago Blumenthal led Republican Linda McMahon by 13 points. But the latest poll shows his lead slipping to just three.

And joining me now with analysis, the woman likely to challenge Blumenthal in November's Senate election, the former CEO of World Wrestling Entertainment, GOP candidate, Linda McMahon.

Linda, welcome to the show.

SENATE CANDIDATE LINDA MCMAHON, R-CONN.: Thank you very much, Sean. It's a pleasure to be with you tonight.

HANNITY: How do we characterize this? Chronic liar? What's the word you're using to describe his behavior?

MCMAHON: Well, he's just not leveling clearly with the people of Connecticut. There have been so many times that he has claimed that he might have misspoken. But they are just clearly wrong. I mean they're just clearly not true, and he is just not leveling with the people of Connecticut and they sense it.

They understand it. And I think he's just painting himself into the same corner of what we are seeing with so many politicians who just don't simply tell the truth.

HANNITY: And it wasn't just —

MCMAHON: And I think the voters —

HANNITY: Go ahead.

MCMAHON: I'm sorry, go ahead.

HANNITY: All right. I'll go. Look, I'm going to play — I'm going to play his before comments. And this was not one-time, this was multiple times. "We have learned something important since the days I've served in Vietnam. When we returned we saw nothing like this public support." When we returned, I remember the taunts the verbal assaults, et cetera. We're going to play that and then we're going to go right to what he said just the other day.



SENATE CANDIDATE RICHARD BLUMENTHAL, D-CONN.: We have learned something very important since the days that I served in Vietnam and you exemplify it.

Now on a few occasions, I have misspoken about my service and I regret that. And I take full responsibility.


But I will not allow — I will not allow anyone to take a few misplaced words and impugn my record of service to our country.



HANNITY: According to the polls, Linda, it doesn't look like a few misplaced words in the minds of the people of Connecticut.

MCMAHON: Clearly not. I mean he's just — he's created deception. He has been certainly ambiguous at best. But I think — I think the people in Connecticut clearly know what he said and what he did not say, and he has just not leveled with them.

And that's just like so many career politicians today. And I think, you know, this coming November Connecticut is going to have historic opportunity for the first time in decades to send a Republican senator, you know, representing them to Washington, and I plan for that to be me.

HANNITY: All right. We got the DSCC chair Robert Menendez said he will continue to support Blumenthal. Chris Dodd whose seat he wants to take. Actually he's been nothing you but the most honorable of human beings in public life.

I got to believe that this — if this were a Republican there probably would be some intellectually honest Republican saying not only get out of the race but step down as attorney general.

Do you expect any Democrat to challenge him?

MCMAHON: You know, I really don't know. There is a — you know, there is a challenger, Mary Galpert (ph), who has been in this race for a long time and I think plans to stay in the race. I don't know what will happen this weekend. You know we have both the Democratic and Republican convention in Connecticut this weekend.


MCMAHON: And I'm hoping to come out of our convention as the nominee. I don't know who the Democrats are going to choose for their nominee.

HANNITY: All right, let me just, and for all our liberal monitoring friends out there in their underwear in a bunker somewhere hoping I say something silly, this is a fun conspiratorial question.

I'm always suspicious when The New York Times breaks a story on a Democrat because they don't do that very often. They are a stridently left, radically left newspaper. Very supportive of the president and Democrats.

All right, so here's my question: They broke this story, they had a follow-up editorial, and I'm thinking, all right, where did this come from? Do you think there's any outside chance that maybe there is some Democrats that want him out of the race because maybe Chris Dodd wants back in, or is that way out in conspiracy right field?

MCMAHON: Well, I don't know about a conspiracy, Sean. I can tell you that, you know, The New York Times did break the story. Some of our research, I think, helped them later on after they had broken the story.


MCMAHON: So I don't know about a conspiracy out there.

HANNITY: All right.

MCMAHON: But I can tell you my focus — my focus right now is on this weekend and taking care of my main opponent, Rob Simmons, who's the Republican that I'm pretty much facing for the nomination.

HANNITY: All right. And you had no role whatsoever in The New York Times breaking the story?

MCMAHON: No, we — our research. They — you know, they had initiated this story. We contributed some research, you know, to the story for the New York Times, but they initiated, they did the research, they did all the verification for it.

HANNITY: All right. Linda, thanks for being with us. We'll watch the race closely.

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