This is a rush transcript from "Special Report," May 8, 2012. This copy may not be in its final form and may be updated.
BRET BAIER, ANCHOR: This is a Fox News alert. Breaking news on that airline bombing plot. A government source familiar with the intelligence tells Fox News tonight the would-be bomber was actually an informant working for an international sting operation. U.S. and Yemeni officials are telling the Associated Press that the informant was working for CIA. Now, that would explain how the agency was able to get access to the sophisticated underwear bomb before an attack was launched and why officials said the public was never in danger. The device is now being analyzed by the FBI in Quantico, Virginia.
But again back with the panel. Steve, that is significant, that the actual bomber was apparently a CIA informant.
STEVE HAYES, SENIOR WRITER, THE WEEKLY STANDARD: It's incredibly significant. It shows I think a high level of human intelligence penetration that we haven't had or at least havn't known that we have had for quite some time. And if you believe that the Al Qaeda in the Arabian Peninsula is the most lethal Al Qaeda cell now or franchise, now this is a pretty significant development. It also as you suggest - I mean you suggested this last night actually, this very scenario. I think --
BAIER: Very prescient.
HAYES: You are, of course, all-knowing. You know, I think the administration had all sorts of escape hatches in its language when it was describing this back in real-time at the end of April, and this now explains why they said the things that they said in terms of we don't have any specific incredible intelligence. The public is not in danger. We all understand now why they were saying what they were saying.
BAIER: Much more as this investigation unfolds.
We want to turn to politics -- the endorsement late last night by Rick Santorum. Of Romney, the presumptive nominee in the Republican Party. Santorum wrote an e-mail down several graphs, quote, "Above all else we both agree that President Obama must be defeated. The task will not be easy. It will require all hands on deck if our nominee is to be victorious. Governor Romney will be that nominee and he has my endorsement and support to win this, the most critical election of our lifetime. Jeff, what about how this endorsement came about and what it means?
JEFF ZELENY, NEW YORK TIMES: I think this is what we call the fine print. It was at the very -- midway through this e-mail. It came out shortly before midnight last night. I don't think there is any love lost between Sen. Santorum and Gov. Romney. I'm not sure that the Romney campaign actually is that concerned about whether Sen. Santorum endorses them or not. What they want is in the fall for him to be out there energizing some conservative groups.
But I'm not sure Sen. Santorum did himself favors just with the party establishment here. He obviously would like some type of a speaking slot at the convention. We'll see if he gets an 11:00 p.m. slot after the primetime is over. But at the end of the day I think it's sort of a last piece of unfinished business of the primary campaign. It's not that big of a deal. Romney is the nominee.
BAIER: Ruth?
RUTH MARCUS, WASHINGTON POST: If I were the Romney campaign I think I would give him the speaking slot at exactly the same hour that he sent out his endorsement. I didn't actually count. I had my computer count it -- 917 words into the e-mail was the point at which he got to endorsement. To give you a sense of how long that is, when Charles and I write a column we have 750 words. So it took him a while to get on the point. He did everything except for send out a picture holding his nose.
BAIER: Do you think the Romney campaign cares?
MARCUS: No. Not, I mean if you are going to do it, might as well do it in a sort of more full-throated, robust way. But I don't think they care that much.
BAIER: A big race tonight is in Indiana, a primary race. And it looks like heading in, obviously, we don't know yet that an incumbent could be in real trouble there.
(BEGIN VIDEO CLIP)
RICHARD MOURDOCK, R - IN, U.S. SENATE CANDIDATE: I don't take any polling too seriously. They are only ever a snapshot at one moment in time. But certainly the trend lines are looking very good for us.
SEN. RICHARD LUGAR, R - IN: We believe we have a large majority of Hoosiers who support us. And so it's a question of getting those votes in the Republican primary so we have a nomination. We continue to fight.
(END VIDEO CLIP)
BAIER: State treasurer Richard Mourdock is looking strong heading in to tonight against, really a Hoosier legend, Senator Dick Lugar. What about that race and it's significance?
CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: I think it's a generational issue. I think Lugar is a lion of the Senate. I think he has served very well and he has been very important in foreign affairs over these years. But that doesn't appeal to voters. He has been in there for a very long time. He has had a lot of moderate opinions. He is not a Tea Party favorite, and I think his time likely will have come. I'm not sure that there is anything he could have done differently in campaigning. He is who he is after all these years. And I think his generation of the sort of somewhat right of center Republicans is in eclipse.
BAIER: The other race tonight is the primary in Wisconsin, Steve. And there is a real battle for the union support and who they will fall behind as this recall effort moves forward on June 5 to oust Republican Scott Walker.
HAYES: Very interesting potential dynamic coming out of the democratic primary tonight where it looks like Tom Barrett at least judging from recent polls is likely to win, the mayor of Milwaukee up 17 points in a Marquette university poll taken late last week. Barrett was somebody who was opposed by the unions. [INAUDIBLE] in particular, unleashed what was from their perspective a tough web video targeting Tom Barrett, suggesting that he was no better than Scott Walker, that he didn't believe in collective bargaining. That he made the same deals after he was elected, and that he wouldn't really be any different than Scott Walker.
So what you're gonna see now is you're gonna have to see unions both public and some private unions swing around behind Tom Barrett and try to pretend that they haven't made this very tough case against him that they have made.
BAIER: Because Jeff, that is significant if you think about the Walker camp, if there has to be this major shift in short amount of time.
ZELENY: I think it's a short amount of time is the real problem here, you are right. If there was a time between now and the fall campaign, if this was a November election, the shift would probably come easier. But it is a quick amount of time. And this will have an impact on the presidential race here. The bruised feelings coming out of the June recall, whoever is successful is going to have a lingering effect. President Obama has a slight edge in the state right now I would say, but it's still a tossup in my view because of this recall.
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