This is a rush transcript from "Hannity," April 27, 2010. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: The left in America is seething over a new to combat illegal immigration in Arizona even encouraging protests that have resulted in vandalism, violence and arrest.

Now the measure signed Friday by Governor Jan Brewer is intended to help combat the more than 460,000 illegals living in Arizona. Now meanwhile, pro-illegal immigration rallies have consumed the streets of Phoenix in recent days fueled by headlines around from the country that have called the bill shameful, even likening it apartheid.

But as The Washington Examiner's Byron York points out, opponents of the legislation probably forgot to read the bill in the first place, noting, quote, "It is the criticism of the law that is over the top, not the law itself."

Now if protesters actually sat down to read the law they would find that racial profiling is explicitly prohibited. In fact, proof of citizenship can only be requested by the authorities during, quote, "lawful contact" by police. meaning the individual is already suspected of breaking the law. It's all right there in the legislation.

But the left, well, they don't want you to know that.

And joining me now with reaction is former Alaskan governor and Fox News contributor Sarah Palin.

Governor, your reaction first of all to the law and the reaction by the left?

SARAH PALIN, FORMER ALASKA GOVERNOR: Well, thankfully, Byron York — he hit the nail on the head in summarizing what this law really is about. There is no ability or opportunity in there for the racial profiling.

And shame on the lame stream media again for turning this into something that it is not. Governor Jan Brewer did what she had to do as the CEO of that state. To help protect the citizens of her state she had to do what the federal government has refused to do, and that is help secure the borders.

I think it's shameful, too, that the Obama administration has allowed, too, this to become more of a racial issue by perpetuating this myth that racial profiling is a part of this law.

HANNITY: Well, and this is the thing that I guess struck me about it. Because I actually took the time to read it. I read Byron York's piece that we just quoted here. But —


HANNITY: It does not encourage profiling. It specifically prohibits it. And here's what the law does say, which is very, very specific. It basically is telling law enforcement they have the right to enforce the law.

In other words they can't go out and pick somebody out and say alright, I suspect you are here illegally. You first have to be under suspicion for another crime.

You mentioned the media. Why do you think the media fails to tell people that?

PALIN: This is the problem with that lame stream media throughout our country, as much as issue — this issue but so many. One of the media outlets the other day just was killing me on this one, Sean, where they had a caption across their screen that said this Arizona law will make it illegal to be an illegal immigrant?

Some bizarre type of headline like that where it was just this illustration that they just don't get it. And that they are trying to turn this into something that it is not.

As you point out, as Byron does point out in his article, this is a reasonable law again, a wake-up call to the feds telling them it is the feds' responsibility. It is the federal government's right and responsibility to secure our borders. This is a national security issue. Jan Brewer did what she had to do to wake them up and tell them they need to start doing their job.

HANNITY: The first job of government, if we are a nation of laws is to protect its citizens and enforce the law. Now the law in immigration is clear that you cannot enter this country illegally. This is bills that are passed by Congress signed into law by varying presidents.

Why do you think there's been an unwillingness to enforce this law?

PALIN: I think that President Obama is playing to his base on this one. And I think that's quite unfortunate because this isn't fair to the legal immigrants. It's not fair to illegal immigrants either, who do want to — many of them want to come here and find that pathway to citizenship. They, wanting to seek the right way to get over here.

This is allowing them, though, a dis-opportunity. They're going to have to hide while they're here. They're not going to be able to seize the opportunities that they sought coming over here.

So it's a lose-lose all around proposal all around for President Obama and his administration to ignore their responsibility and not enforce the laws that are existing. Again, Governor Brewer and her legislature, they did the right thing, 70 percent of Arizonians who support this law are doing the right thing in sending this wakeup call to the feds.

Another thing, Sean, this is quite the illustration of President Obama not understanding the 10th Amendment to our Constitution. Here he ignores the 10th Amendment when it comes to something like Obamacare where he is mandating, he is forcing the state and the state citizens to take action in the case of Obamacare to purchase health care that may be some people aren't desiring to purchase. He's making them do that anyway in violation of the 10th Amendment.

And yet not respecting our Constitution when it comes to the rights, the responsibilities, too, of the federal government and making a state takeover a national security issue like protecting our borders. He has no concept, it seems, of that 10th Amendment.

HANNITY: We know it's being distorted by people obviously that have some political motivation. What some of their motivations are, I can't read their minds or their hearts. But we have civil rights leaders. We have politicians. The terms that have been used, this is a form of terrorism, this bill. There have been multiple comparisons to Nazi Germany and Jim Crow.

And by the way, I thought you'd like this governor, the city of San Francisco is calling for a boycott of Arizona.

Your reaction to these comments?

PALIN: Well, yes, it is over-the-top. And it's really to incite and energize some of Obama's base hoping that they'll show up at the polls in the midterm elections in November.

This is one issue that they really feel that they need grab hold of because you know much of the Democrat Party coming up in this November midterm election, it's a sinking ship. And they have to have a couple of lifeboats out there. And they believe that this is one.

Because, again, this law in Arizona that has recently been signed, it essentially replicates, duplicates the federal law any way. So I don't know why Obama has a problem with that, and as we've said, Sean, it is telling the federal government that they better wake up, buck up, and do their job in securing our borders.

HANNITY: All right, 70 percent of the people in Arizona, they agree with this law, according to a recent Rasmussen Poll.

PALIN: Right.

HANNITY: Now Senator McCain is going to join us a little bit here tonight. Both he and Jon Kyl have both called for troops along the border. Do you think — look, we know the impact to immigration on education, the educational system, the health care system, the criminal justice system.

So the question is, do you think that would be the answer?

PALIN: Well, it's going to be part of the answer. And you know, I think that most Americans will appreciate our senators calling for more help along the border to secure it in Arizona and elsewhere, other border states calling for more assistance, too.

Again, bottom line it's because the Obama administration will not fulfill the responsibility that the federal government has and the states have had to then pick up and tell them what their responsibilities are.

HANNITY: Alright, Governor, we're going to pick it up right there.

By the way — and the attacks against you never seem to stop. Even now we have one commentator saying you're bordering on seditious.

So we'll get into that with Governor Palin.


HANNITY: And we continue now with former Alaska Governor Sarah Palin.

Governor, you have been attacked for the clothes you wear. Your family has been attacked. Your intelligence has been questioned. Your governance has been questioned. Your motivations has been questioned.

But I'll be honest, I don't think things have gotten this bad in terms of the attacks on you and this is just the last week. I've asked you about different instances in the past. The president recently took a shot at you about the arms control issue.

You have Joe Klein, prominent writer, prominent news magazine, actually saying that you were rubbing right up to being close to "seditious" from TIME magazine, Joe Klein. You have Representative Grayson. "Governor Palin is trying to make fascism fashionable." And James Carville, "Palin is a reptile," but only he would know.

Look, I know you're used to the attacks. Seditious? That is a serious charge. And I wanted to give you an opportunity, Grayson, fascism fashionable. These attacks now are crossing a line in my mind and I wanted to get your reaction.

PALIN: Yes, what a piece of work that Mr. Klein is for the piece that he wrote. That is something else.

You know you would hope that the powers that be at a, quote, unquote, reputable organization like TIME magazine that they would hold their employee — and I assume that Mr. Klein gets paid for the columns that he writes — that they would hold their employee accountable and they would actually ask him what is it that I or others in the conservative movement have said that would rise to the level of this inciting of violence and revolt and all these other things that evidently he claims.

For them to allow things like that to be printed just really discredits TIME magazine and other organizations that would allow that kind of rhetoric and false reporting, misreporting. They're lies.

HANNITY: You know, look, I watched with fascination and almost bewilderment, the attacks on the Tea Party Movement. Look, I've experienced a lot of this throughout my career. I — look, I'm on the air four hours a day, I can take it but to attack citizens that are just expressing that they think government is too big, our debt is out of control, and we're on the wrong path on national security, seems bewildering to me.

What do you think the motivation here is? Is it to discredit you with your base, with the American people? Is it that they think you're too effective and they want to intimidate you? What do you think it is?

PALIN: Well, you — what you're suggesting there is absolutely spot on, Sean. It's not about me. And it's not about you either and the message that you spread. I know that it's not about me. It's about the message that's just this common sense conservative solutions that are needed to get this country back on the right track.

They don't like it. They can't handle it. We rattle them when we talk to these liberal elites about what it is that most Americans believe in. Those time tested truths that built America into the greatest country on earth and we want to get her back there. We want to be able to embrace that exceptionalism again.

And when we talk about things that we can do to put us back on the right track, it drives them crazy. It makes their heads spin. And I don't know, I think we should look at it kind of as a compliment that we are effective.

But it's not about me, it's not about you, it's about the American people who want their voice heard. And that's nearly what this Tea Party movement is about, people rising up and saying government you need to listen to us, quit lecturing us, listen to us.

HANNITY: You know what, Governor? I find it amazing and I think it probably drives them crazy that you're unaffected by all of this, which I think is a good thing. It's sort of water off a duck's back reaction which I think is always a good one.

Well, you've had a real job. We now have the head — our Treasury secretary admitting that he's never had a real job, that being Tim Geithner. But I wanted to ask you more specifically in light of that, Ernst Bowles, we have this debt panel which will offer their recommendations after the coming election which I find the timing a little bit dubious.

But they're saying that the president agrees that everything is on the table and that includes tax increases and that includes even a consumption tax or a value added tax.

What do you think that would do to the economy? And is the president looking for cover to break one of the prime promises he made during the campaign?

PALIN: Yes, the president is looking for cover to allow him to break yet another campaign promise that he would not increase taxes. Because so often a commission like this is formed just for that purpose, to create cover. So that in this case the president could say well, they told me to do it, we have to do it or the economy will fail, we will be in crisis.

I'm sick and tired of hearing about Obama and the White House coming out with yet another crisis that has to be fixed by government, sticking it to the people and taking more of what we earn and produce instead of allowing our small businesses specially to keep more of what we earn and produce and then reinvest according to our own priorities so that we can grow and thrive and hire more people. That's how we create jobs, that's how the economy will get roaring back to life.

But see, too many in the White House including our own president — I don't know when they have run a business. I don't know when they have been a CEO of anything where they've had to look out for the bottom line and they've had to make payroll and live within their own means with a budget.

You know they're from government. They're — you know community organizers. They've been spending other people's money for so long that I think a lot of the free enterprise principles that so many of us believe in, it's all foreign to them.

HANNITY: You know, Governor, it's interesting. As we head into this midterm election year which I think is going to be one of the more important ones in our lifetime. The president actually came out and stated this weekend, "It will be up to each of to you make sure that young people, African-Americans, Latinos and women, who powered our victory in 2008, stand together once again."

Do you think — it's sort of an admission by the president that he sees the poll numbers? That he sees the direction the country is headed? That he sees right track, wrong track, generic ballot, and all these things are not going in his direction and he's trying to get his based energized again for these midterms?

PALIN: Unfortunately what it does again, Sean, is divide our country. I wish that our president would stand so strong and proud under one Constitution reminding America that we are all one America. We are all in this together. And instead of dividing, according to demographic, or race or gender.

Let's remember that we are all one America. We are all one big family. We are in these challenges together. And there's nothing that America is facing today that we can't fix as one America. But it doesn't help when our own president is trying to divide like this.

HANNITY: Alright, Governor, we always appreciate your being with us. Thank you for being onboard tonight.

PALIN: Thanks so much.

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