This is a rush transcript from "Hannity," October 20, 2011. This copy may not be in its final form and may be updated.
SEAN HANNITY, HOST: Tonight, big news for Libya, the United States and the entire world. Embattled dictator Muammar Qaddafi was captured and killed earlier today. Now, this footage appears to show him bloodied and alive before rebel forces took his life after storming his final strong hold in the City of Sirte.
Now, Colonel Oliver North will be here with reaction to that and much more coming on later tonight. But first, there is more good news for the presidential campaign of Herman Cain. In a moment, I will be joined by former Alaska Governor Sarah Palin. We will get her reaction. But first, in a survey conducted the day after the Las Vegas debate, 28 percent of those polled in the key primary state of Iowa say they will back Herman Cain. Now that is a seven point lead over Mitt Romney. Ron Paul rounded out the top three. Meanwhile, Rick Perry came in a disappointing sixth place receiving only seven percent of the vote.
And as Herman Cain rides his 999 plan to the top of the Republic field, it appears that Governor Perry is working on a bold tax plan of his own. Let's take a look.
(BEGIN VIDEO CLIP)
GOV. RICK PERRY, R-TEXAS, PRESIDENTIAL CANDIDATE: In six days, I'm going to release the details of an economic growth package that will create jobs, create growth, create investor confidence in America again. It starts with scraping -- excuse me, might want to scrape it too. Scrapping the three million words of the current tax code starting over with something simpler. A flat tax. I wanted to make the tax code so simple that even Timothy Geithner can file his taxes on time.
(END VIDEO CLIP)
HANNITY: All right. Joining me now with the latest on the 2012 presidential race, former Alaska governor, Fox News contributor Sarah Palin is back. Governor, good to see you.
SARAH PALIN, FORMER ALASKA GOVERNOR: Good to see you, Sean, thank you.
HANNITY: All right. Before we get to that, let's start with the death of Qaddafi today. And, you know, I was very skeptical with the Arab Spring. Everybody said democracy, democracy. It looks like the Muslim Brotherhood, you know, the things that you were warning about, I was warning about and some others that it could be far worse in the end. Are you concerned the same thing can happen here with the death of Qaddafi?
PALIN: Certainly, we need to be cognizant of the evolving situation and who will replace Qaddafi. What government will replace that regime? We are very glad that this tyrant is finally gone but, yes, will the Islamist take over? Will tribal warfare create more unrest and more chaos and oppression than was even under Qaddafi? So we have to be aware of the situation as it evolves.
Hey, let me add something though to this Qaddafi regime change now, discussion. And that is, it strikes me as quite ironic, Sean, that those on the left had been so dismissive of Ronald Reagan's 1986 air strikes against Qaddafi and calling it a criminal act and these are the same people now today celebrating Obama's participation in NATO's leadership with the air strikes that has led to the demise of Qaddafi. The inconsistencies there with foreign policy support and actions that our military and our participation with NATO and what the White House does, the inconsistencies and the hypocrisy that comes from the left never ceases to amaze.
But, again, having said that glad Qaddafi is gone. Need to be aware now of the evolving situation.
HANNITY: Well, it's funny, there is such a big deal, George Bush got authorization for the use of force in Iraq and Afghanistan. The president, I don't think the War Powers Act is constitutional for a lot of reasons. The president, he is the commander and chief, Congress can defund any military action. With that said, every president has been abiding by it anyway. In the cases of President Obama, he said this is a NATO operation. We control 65 percent of NATO. So, was he trying to, in that sense, go above and beyond what his authority was?
PALIN: Well, again, I think that there is a lot of inconsistency and murky foreign policy coming out of this White House. And you know, you got to hand it to Ron Paul. Whether you agree with everything that he says or not, at least he has one there in Congress trying to make our president stick to the law and understand that Congress does have a role to play in these foreign policy decisions that are made and Ron Paul, I think has hit the nail on the head when he has come out and said that Obama had better be careful when he interjects himself in our country in other nation's business.
HANNITY: What do you make of Herman Cain and, and for example, the new Iowa poll that comes out? He is leading there. He has been doing very well in the polls. He's second in the national poll that came out to Romney. Iowa, look, whoever wins Iowa gets huge momentum heading into New Hampshire, South Carolina, Florida, and Nevada. So, the question is, do you think unlike Perry, Pawlenty, Bachmann that he can sustain his rise?
PALIN: Yes. And those others have led in Iowa, also. I do believe that Herman Cain can keep this momentum going. He is doing very well because he is not a politician. And voters are craving the nonpolitician to be willing to help lead this country, get it back on the right track. Herman Cain recognizes that it's the permanent political class that got us into this economic mess and we don't need more of the same thinking that that's going to be the solution. Herman Cain is candid, he is authentic, we appreciate that coming from him. We appreciate that he has gotten the ball rolling on tax reform proposals in his 999 plan. And again whether you believe or can really embrace all of that 999 plan, at least he has got the ball rolling, saying we must reform our tax code today because it is a monstrosity. It's burdensome and it's destructive. It shackles American entrepreneurs and we must do something about it. Herman Cain is willing to do something about it.
HANNITY: Do you like the plan? Obviously, you've had time now to look at it. Is it one that you would support? Would you tweak it? Would you change it? Or do you think as it's currently designed is one that would work?
PALIN: Well, definitely I would tweak it. Because I believe that in order to get rid of crony capitalism and corporate welfare and the corruption and waste in the federal government, we need to get rid of the corporate income tax which chases jobs overseas by the way, but it also feeds into the crony capitalism when you have businesses that can afford to pay the lobbyists and the attorneys to write the rules that the rest of us have to abide by, but, you know, a lot of the big corporations don't have to. And then they get to skate without contributing to the national coffers. There's a lot of problems with America's corporate tax rate, which is the highest in the industrialized world, even higher than communist countries. We need to get rid of that. So, that's one of the things that I would tweet in that 999 plan.
HANNITY: All right. One thing they could do certainly is what you've been saying, drill. Canada was in a recession in 2009. They started drilling and now Americans are going to Canada to get jobs. North Dakota has an unemployment rate now, 3.5 percent. Nationally it's the 9.1 percent because they are drilling for oil which they hadn't been doing. You said the other night on Greta, you thought Newt Gingrich won the debate. What do you think -- do you think he has a chance to break through? Do you think Rick Santorum at some point could break through? Do you think Perry can recover?
PALIN: Well, you know, Newt has been in the trenches. He seems to have seen it all and his calm, cool, collected demeanor I think bodes well in these debates because he is not down in the kind of junior high level bickering back and forth with the other candidates, but he wants to stay at the 60,000-foot level and talk about solutions and really address what the problem is and the problem obviously is Obama's socialist policies that are bankrupting this country. That's what Newt's focused on. And I think that resonates. And he, too, can build some momentum. Rick Perry now coming out with really embracing Steve Forbes's flat tax idea. That's going to gain momentum. I look forward to hearing more of the details.
In fact when I heard that Rick Perry was embracing of Steve Forbes idea, I went into my garage and dug out an old book from 1999 that Steve Forbes had written about the freedom to choose taxpayers. How do you want to file your taxes? Do you want to continue under this current monstrosity of this destructive IRS code that we are stuck with today? Or do you want the freedom to choose the simpler, fair, flat tax? Rick Perry no doubt will talk about that because it is what Steve Forbes had written about over the years. Such a proponent of and many aspects of it makes so much sense.
HANNITY: Do you think it was a mistake especially when Perry was so aggressive to Governor Romney over the issue of supposedly hiring an illegal immigrant which Governor Romney said sorry that didn't happen. A lot of people in our focus group that we did last night with Frank Luntz, it didn't go over well with people. What was your reaction?
PALIN: Well, you know, these debates, it's democracy in action. And I love the contested primaries. I like that we have to duke it out and share ideas. I don't like the pettiness. And I think that does kind of make people feel disenchanted with the idea of serious debate. This is a serious job. And these are tough tumultuous times where we need solutions. We don't need kind of that pettiness that comes out with some of the questions and answers in the debates. But it's democracy in action, it really reveals character this process. And bottom line, Sean, it's not tidily winks. You know, you jump in there in this arena and you need to expect to be beaten up a little bit by the media certainly and perhaps by those within your own party. But character is revealed and skills also come to the surface.
HANNITY: And no regrets on your part not jumping in?
PALIN: Nope. I appreciate the role that hopefully I will be able to play and that's spurring discussion about how to spur economic growth in this country and very thankful that it seems like these Republican candidates are getting the ball rolling on talking about the solutions that so many of us want to be able to discuss with them.
HANNITY: All right, Governor. Great to see you again as always. Thank you so much for your time and we appreciate you being with us.
PALIN: Thank you.
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