This is a rush transcript from "Hannity," January 14, 2010. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: Former Alaska Governor Sarah Palin is once again making headlines after announcing that she is becoming the newest member of our team here at Fox. And I sat down with her to talk about that and much more.

Let's take a look.


HANNITY: And Governor Palin, welcome to the Fox News Channel.


HANNITY: I guess we're colleagues now.

PALIN: We're teammates. Here we go.

HANNITY: Welcome aboard.

PALIN: Thank you.

HANNITY: Really appreciate for you to be here.

• Watch part 1 | Part 2 | Part 3

So I want to ask you, as this year unfolds we're going to invite you on the program, and we're following I think one of the biggest midterm elections that we've ever had in the country. What are your general big picture thoughts about this election year?

PALIN: I think there's such a disconnect from those on Capitol Hill with the voters today. And we're going to see some evidence of that with the upcoming elections, with these midterms.

I think we're going to see a shift in the Massachusetts race that's coming up here shortly. A bit over a week. Win, lose or draw, the conservative candidate running there, I think it's going to send a very strong message that this status quo, even in Massachusetts, the status quo of just accepting the big growth of government and health care takeover measures that it seems Capitol Hill wants to cram down our throats today. Things are going to start changing. Thank God things are going to start changing.

HANNITY: What a political earthquake, though, that would be.

PALIN: Yes. Right.

HANNITY: You know, if — look, first of all, New Jersey was a big win.

PALIN: Right. Virginia, big.

HANNITY: Virginia.

PALIN: But, even — and I would love to be able to at some point interview Senator Brown. I anticipate victory there. But even if he doesn't win, already, poll numbers showing that his message is resonating. And his message is common sense conservative values, principles, solutions being plugged in to meet the challenges facing America today.

People in his state, they are listening to him. And they're getting excited this dynamic candidate.

HANNITY: You have been having a big impact on these races. For example, Doug Hoffman in the New York 23rd. What are your plans for this year? I know you got speeches and I know you're traveling a little bit. Are you planning to get out on the campaign trail and go out there and stump for candidates?

PALIN: I sure will. I will. Those who understand the need for our country to become energy independent, to allow security — national security and economic security via energy independence — those who get it, I'm going to be out there working for their cause.

HANNITY: When you say those that get it, that's interesting to me. Because it was interesting how conservatives stood up and supported Doug Hoffman while the establishment candidate, Dede Scozzafava, you know what? They said no.

Will you pick and choose — even if somebody is picked by the establishment if there's a more conservative candidate, more in sync with your values, are you going to be willing to step out every time and go for the conservative?

PALIN: I sure will. I don't hesitate to do that. I've never hesitated to kind of — bucking the trend or the tide.

HANNITY: Going rogue?

PALIN: Going rogue, yes, in order to not just go with the flow and do what maybe some head honchos want, because they're not always right.

The people of America, though, their voice is growing louder and louder when they're saying no to government takeover of our health care system to allowing 1/6 of our economy in the private sector to be shoved into the government's hands.

An issue like that, no. People are saying whether the establishment likes it or not, the people don't like it and a representative form of government demands that it is literally a representative hearing the voice of the people and implementing what their will is.

HANNITY: I don't think I've ever seen — and everywhere I go, and I'm sure — you just came off a pretty big book tour, and congratulations, the number one book of 2009.

PALIN: Thank you.

HANNITY: I've never seen people this energized.


HANNITY: That a conservative — I don't think I've ever seen a moment like this and I've been, you know, on the radio — I hate to age myself here — since 1986 and since we began here on the Fox News Channel in '96.

Does that translate, do you think — is there any obstacle you see that gets in the way of what we predict is going to be a pretty big year?

PALIN: The nice thing about this energy that you can fill, you can fill with these campaigns and talk about new dynamic candidates being willing to put themselves out on the line and run for office to serve us.

It's independents, too. Independents are saying we want common sense solutions in there. We don't want government growth. We don't want to incur such debt that is, to me, immoral, it's irresponsible. We are handing it to our children and our grandchildren to pay bills for us, for our desires today.

It's the independents, too, saying, no, we need to shift gears here. We need to get away from what the Obama administration is doing to us.

HANNITY: Did you see — the AOL, the sign on to AOL — I don't know if you're an AOL subscriber — has an article about you saying you coming here to Fox may disappoint many of your fans. Because they say, well, maybe they will interpret that as a signal you're not going to run in 2008. That —

PALIN: Well, first.

HANNITY: I'm sorry, 2012.

PALIN: First, you know, I said forever what would America do without Fox News? This is where you will get fair and balanced reporting and analysis of the issues that are so important to all of us.

But, you know, I'm not going to close any doors for my future, for my family's future, don't know what's in the future or what it holds but — between now and whenever some big decision has to be made I'm going to do all that I can to help our country get back on the right track and that's to get a message out there about solutions that I believe in and a whole lot of Americans believe need to be plugged in.

HANNITY: See, I agree. Michael Steele was on this program when he launched his book. And, you know, I thought this was a good take that he had and I think this is good for your personal life.

If things are going wrong in your personal like, you got to take stock of yourself. You got to become introspective and you got to say, all right, where am I making mistakes? And so he said the Republican Party had made mistakes. And then he was criticized for admitting that.

I think that's the first step towards becoming a better party or a better person. Your thoughts?

PALIN: And I say after Michael Steele's comments the other night, I was like right on, more power to you, Michael. You're calling it the way that you see it and you deserve to call it that way.

And basically, of course, his message was buck up or stay in the truck, critics. If you don't want to help out, if you don't want to help the cause of getting these common sense solutions to all these challenges facing us, then, you know, go find something else to do.

But don't just sit there throwing stones and this internal inside baseball infighting in the Republican Party. I e-mailed Michael Steele, too.

HANNITY: You did.

PALIN: I said 99 percent of Americans they don't know who these people are, the establishment, and they couldn't care less.

HANNITY: I think you're right.

PALIN: About what's going on internally.

HANNITY: See, because I've been a critic of the Republicans. I saw what was happening in 2006. And I saw problems leading into 2008. I think the Republican Party, this is — I think they abandoned some of their core values.

What do you think some of the mistakes were that they should admit to so that they can move on?

PALIN: Definitely, some of the Republicans on Capitol Hill have abandoned the core values that have to do with shrinking government, not growing government. That's a very simple thing.

Sean, you know, the Democrat Party, too, though, has abandoned so many of the good Democrats out there. That's what they're telling me. They're saying, wow, we feel kind of lost right now because the Democrat Party today in power has gone so far left, taking these steps towards — some would characterize it as heading towards socialism.

Yes, that those steps that they are taking, there are many, many, many Democrats disappointed in that party machinery, too. That's why in Alaska, 70 percent of Alaskans are independent. That they don't want to be a part of a political machine that allows partisanship to get in the way of just doing what is right.



HANNITY: And coming up, so what if Sarah Palin got a call from President Obama? What would she say to him? You'll find out right after the break.

Plus Sarah Palin reveals plans for her very own Fox News show. That is straight ahead.


HANNITY: And we continue now with more of my interview with former Alaska governor and the newest member of the Fox News family, Sarah Palin.


HANNITY: Is it too early to think about 2012 for other people maybe that you're looking at, that you think, all right, that person may have — have what it takes to be a leader? Anybody you see on the horizon.

PALIN: That there are.

HANNITY: Excluding yourself.

PALIN: There are so many out there who are quite bold, who are also not allowing the partisanship within the machine of the party to get in the way of having their voice heard on some of the solutions that we need to see.

Those who understand, as I pointed out, the need for energy independence who wants a strong military presence so that we can have a peaceful existence here. We've only had peace through strength.

And all those other principles that certainly in the GOP, the points on our platform build there are so many. But I do think it's still quite early.

HANNITY: Would this be the platform — be the party of national security. You don't negotiate without preconditions with Holocaust deniers, the party of fiscal integrity, balanced budgets, eliminate earmarks, the party of energy independence, I know you'd support that. Free market solutions for health care and education. Is it that simple?

PALIN: It is that simple.

HANNITY: It is that simple.

PALIN: It is that simple. The establishment, the politicos, they want to complicate things. They want to confuse the electorate so that people feel at some point that they need to sort of back off and not be so involved any more.

Now we're trying to bring a message back to that simplicity, back to the planks and a strong platform that can build a stronger America. And the tea party movement that they're trying to keep it simple, too, and let people know that no, here are the things that have worked in the past.

History has proven that free market principles being applied will allow the private sector to grow and prime and prosper and our families to keep more so that they can prioritize their earnings much better than government can.

People within that tea party movement, they get it. Their voices are being heard.

HANNITY: Let me ask you. Is there a chance, is there any fear, because they actually polled — the tea party movement polls higher than the Republicans in a poll.

Do you worry that they may split or divide the conservative vote in the country or do you think in the end they come together and do you have a fear or message to those that may think about splintering off?

PALIN: That's a great question. Because heaven forbid that there be that splinter. I think at the end of the day we have the same message, and that is — those points that you have just made, about strong military, about free market enterprise being able to drive our economy, not government growth driving our economy.

Government getting out bailout, businesses, getting out of the private sector and out of our lives. Those within the tea party, I believe, agree with so many in the Republican Party and a lot of Democrats too believe in that, too.

HANNITY: Who? I don't see moderate Democrats, who?

PALIN: There are some good ones. In the heartland, especially.

HANNITY: In the heartland. Not in Washington.

PALIN: No, not so much in the establishment, absolutely. But heaven forbid that they become the factions, though, and fractions within, say, the tea party movement and there become the infighting within that movement and then that prohibits the progress that this movement can make.

HANNITY: What do you think of this controversy with Harry Reid? It wasn't just what he said but then Bill Clinton made the comment apparently to Ted Kennedy, you know, a few years ago Barack Obama would be getting us coffee.

What did you think when you heard about that?

PALIN: Tough to defend those statements. And that type of thinking that is quite foreign to so many of us who would not judge someone — have any kind of criteria based on skin tone.

HANNITY: What would the reaction be if Sarah Palin said that?

PALIN: Or Sean Hannity. Absolutely. You get clobbered if you say such a thing.

HANNITY: Clobbered. Probably be even fired.

PALIN: Well.

HANNITY: Or there'd be calls for me to be fired.

PALIN: This double standard, this hypocrisy is what drives the rest of us crazy. Remember Trent Lott said what he said? He got run out of town. Here, Harry Reid says what he says, and I don't believe that either person, a Trent Lott or Harry Reid, are racist, I don't.

I believe that they picked the wrong words in trying to make a point there. But look at double standard applied. It's OK for Harry Reid to say such a thing according to the liberals but it wasn't OK for Trent Lott and others?

HANNITY: Should the same thing happen then to Harry Reid? In other words.

PALIN: Well, should he step down?

HANNITY: Should he step down?

PALIN: Well, I think he should step down anyway because I think he is driving a bus that is headed towards a train wreck that is going to happen in America if we continue down this road that he, and Pelosi and Obama want us to be on, a road that is allowing this government growth and is hesitant to really bolster our national security. That road that they want to put us on, it scares me and it scares a lot of Americans.

HANNITY: Now the president always says that he — and I agree with you. The president always says that he would want to hear from other voices and other people. If the president ever reached out to you to get an opinion what would you want to tell him right off the bat about either national security or the economy? Would you — what would you say to him?

PALIN: I would definitely go to the national security issues. I know that jobs are the number one issue in our country. That is what is on voter's minds. People want to know how are we going to get out of this 10 percent unemployment rate and the 17.3 percent underemployment rate. This is horrible.

And I think enough people are already telling Barack Obama come on, you got to do something different here. You got to quit growing government and assuming that government is the solution to the economic woes in this country.

People are already taking care of that. I'd like to talk to him about the national security issues, though, and what I believe the rules of war should be. And I would like to recommend to him that he show a little bit more passion in this War on Terror so that we can trust that perhaps the steps that he takes that seems to be so hesitant, to make decisions when it comes to our national security, that we can at least trust that he's really being deliberate — he isn't purposefully hesitating and dithering and being kind of wishy-washy on things when the rest of us want to see action taken so we can get this war on terror won. We can get it over with.


HANNITY: And coming up, Governor Palin on the president's broken promises and the type of people she'd like to profile if she had her own TV show. Straight ahead.


HANNITY: Now we continue now with more of my interview with former Alaska governor and Fox News contributor Sarah Palin.


HANNITY: How worried are you about the economy? A lot of people out of work, they're not even counting millions of people any more in their new data system.

PALIN: Right.

HANNITY: The president promised that the stimulus, you know, unemployment wouldn't go above 8 percent. How afraid are you about the situation involved in the economy?

PALIN: And now we are hearing about China's emergence, their economic emergence and other countries, too.

HANNITY: China, by the way, the largest automaker in the world.

PALIN: See? And here we're stalled because we're disincentivizing manufacturing, we're disincentivizing production and the job creation that we need to see and now — in order to allow our economy to where we need to cut the taxes on the job creators of small businesses. We need to allow families to keep more of what they're earning.

Instead, Sean, where we're going to go and I think that this will be revealed here shortly in this new year. We're going to see revealed the tax increases that were promised not to happen.

But I guarantee they will happened. Otherwise, how the heck are we going to pay for these multi-trillion dollar plans of the White House?

HANNITY: How insane is it that you would be better off to die this year because you'd pay no estate taxes? But if you die next year they're going to take half of whatever you made in your lifetime. How insane — only Washington can come up with a cockamamie, you know, idea like that.

PALIN: You know what an idea like that — you have to ask yourself, bring it back down to simple terms. How does that create a job? How does that put food on the fable for someone? How is that going to help our economy?

It's not. It's going to hurt. So you ask what I would say to the president if I had the opportunity. We talk national security and then we pivoted in to the economy, I'd ask him, do you really think that where we're going today with growing government and incurring this huge debt, this deficit spending, do you think that is helping?

Because even if he doesn't believe us, the commentators, he just has to look at the numbers and see it's not working. So.

HANNITY: No, they're digging in. They're talking stimulus two.

PALIN: So let's humble ourselves and let's say, you know, we went down that path for a year. It isn't working. Let's shift gears. Let's go a different direction. And you know, I do want to hear more voices and I will actually hear from people who have other ideas, besides growing government as the idea.

HANNITY: It seems like they're doubling down, though, if they're having going to have the son of stimulus, they're just doubling down on bad ideas which —

PALIN: It's a horrible idea, the second stimulus when we have not measured the success of the first stimulus.

HANNITY: Let me ask you. Did you watch all those health care hearings on C-SPAN?

PALIN: I missed them. Gosh, when did they air?

HANNITY: You've missed those?


HANNITY: What does it mean —

PALIN: Me and every other American missed it.

HANNITY: When George Herbert Walker Bush said read my lips, no new taxes, he paid a heavy political price.

PALIN: He was held accountable for that.

HANNITY: He was held accountable.

PALIN: Right.

HANNITY: Do you think Barack Obama saying eight times — eight times — during the campaign of which you are a part, you know, I'm going to put all these hearings on C-SPAN. And then he breaks that promise and every meeting is behind closed doors.

And do you think he pays a political price for this?

PALIN: And there hasn't been the bipartisan effort that had been promised.


PALIN: I do, Sean, because the people of America are smart, they're intelligent, they're astute. They're paying attention now more than ever to what is going on. And I think that we're going to see that manifestation of their frustration. And they're paying attention to what's really going on in these midterm elections.

HANNITY: Yes, I agree. Now one of the things, you're amazed at how the amount of impact your Facebook comments have had in the political discourse and debate, because every time you write something it goes out over the wires, you've noticed that?

PALIN: Well, they're usually pretty simple messages that I'm posting there on Facebook.

HANNITY: When you're talking about health care, you know, you said to those death panels which created a big controversy and you're adding new words to the American vocabulary here. You stand by those comments because you think it still exists in the bill?

PALIN: I do. It's a commission. It's a bureaucracy. It's bureaucrats who will ration care if the bill goes through as Obama wants it to go through. Yes, it's modeled in essence after a British system that does have people to decide whether, based on your quality of life, your age, whether you're going to deserve health care coverage or not.

That's what's going to happen in America if this health care bill isn't stopped. And it needs to be stopped soon and that's why the people of this land can't give up in demanding that their voice be heard.

Demanding that the White House understand that this is a representative form of government. We do expect that the will of the people is listened to and adhered to and implemented via our representatives whom we elect.

HANNITY: All right, so as you embark on your new career as a fellow Fox colleague, I read in the press release that you're going to be hosting shows and doing specials. What can we expect — I would expect one that you might do. I'm guessing off the top of my head.

PALIN: Well, here's what —

HANNITY: Maybe one on energy independence?

PALIN: Absolutely. Energy independence, what I would like to focus on for our children, I want to find real role models. I want to find those who should be our celebrities, those who we would be proud, Sean, for our children to be able to look up to and say I want to be like that person.

That person who maybe would never be in a spotlight but they work hard to put food on the table for their family. They're selfless, they're helping others, they are compassionate. They have a strong, strong work ethic.

I want to find those people across America. I want to profile them and I want to say kids, you can be like that person because this is America.

HANNITY: So in other words, you would do profiles on great Americans that we never hear about every day?

PALIN: Absolutely. Absolutely. Yes, real, real American idols.


— Watch "Hannity" weeknights at 9 p.m. ET!

Content and Programming Copyright 2010 Fox News Network, LLC. ALL RIGHTS RESERVED. Transcription Copyright 2010 CQ Transcriptions, LLC, 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 CQ Transcriptions, LLC's copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.