This is a rush transcript of "Special Report With Brit Hume" from May 8, 2008. This copy may not be in its final form and may be updated.


SEN. HILLARY CLINTON, (D) NEW YORK: I am building such a strong and broad coaliti on among the states and among the voters we must have to deliver the White House. And my campaign is winning swing states.

SEN. BARACK OBAMA, (D) PRESIDENTIAL CANDIDATE: I think my main message is just whichever way you want to go, the sooner that superdelegates make their decision, the sooner we'll have a sense of who the nominee will be, and the sooner we can focus on John McCain.


BRET BAIER, GUEST HOST: Senators Clinton and Obama today talking about the race ahead and the Democratic battle for the nomination.

So now what? Some analytical observations from Fred Barnes, Mara Liasson, National Political Correspondent of National Public Radio, and syndicated columnist Charles Krauthammer, FOX News contributors all.

Mara, USA Today, Hillary Clinton says "I have a much broader base to build a wining coalition on." She cites an article that found that Senator Obama's support "working, hard working Americans, white Americans, is weakening again."

MARA LIASSON, NATIONAL CORRESPONDENT, NATIONAL PUBLIC RADIO: First of all, he actually did better among those groups in Indiana than he did in Pennsylvania and Ohio—not much better, so that's not true.

But yes, she started talking about white voters today in a way she hasn't up until now. In the past she has talked about working class voters and Hispanics. But she is basically saying that those voters, low-income whites and Hispanics, will not vote for him in the general election, that that is her base and that's why she is a stronger candidate.

I don't think, first of all, there is a lot of evidence for that, because a lot of those voters will come home. Some of them, it's true, won't vote for him.

But maybe this is her strategy for the rest of these campaigns, is to focus on this. I think that won't be music to the ears to a lot of superdelegates.

BAIER: Fred, what is the end of the campaign for the superdelegates?

FRED BARNES, EXECUTIVE EDITOR, THE WEEKLY STANDARD: There are conflicting signals. One, she didn't attack him directly today and say Barack Obama is not qualified to be commander in chief. She is attacking his constituency, or his lack of broad-based appeal, and things like that.

Then you hear elsewhere that maybe she is making a pitch to be the vice presidential running mate for Barack Obama, and there is a 98 percent chance that he is going to be the nominee and will have locked it up sometime next month, or maybe sooner.

She raised again the question of Michigan and Florida in a letter to Barack Obama in saying I'm trying to work this out, you're no help.

I think she's playing a lot of different cards. Some are conflicting, but, at the end of the day, she would, I think, not be the nominee, but would like to be the vice presidential running mate. I'm not sure this is the best way to get it, though.

BAIER: So, Charles, in these upcoming contests, are we going to see a change in the tactics here from both sides?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: No. I think the endgame for her is the stake through her heart, nothing less.

She is not going to withdrawal, and there are several reasons. First of all, you never know what is going to happen. A lot of stuff has happened in the last eight weeks to Obama—Reverend Wright, Bill Ayers, the guns and religion comment, which hurt him. Wright could have sunk him, could sink him again in the future. So she wants to actually be around.

Secondly, if she is going to withdraw, why not do it on a night when she wins Kentucky by 15 and dramatically announces at the end of her speech, like Lyndon Johnson in 1968, and goes out as a kind of a hero.

But, thirdly, the longer she stays in, the more Obama is going to be annoyed, and he is going to want to bargain. And it is not just the vice presidential nomination, it could be a Supreme Court appointment for her or her disbarred husband.

Or it could be her debt. I mean, after all, it has happened that the winning candidate has used his money to wipe out the debt of the loser. She has $6 million or $7 million of her own in the campaign. In normal life it's called bribery. In politics it's called "healing the party." It could happen, and she could demand it.

So I think she's going to stay in at least until the last dog dies, as her husband puts it.

LIASSON: Paying her debt, which is actually $11 million, which she loaned to the campaign, would be a very small price to pay. I think she wants more than that.

BAIER: Is there a sense inside the campaign that this is a dwindling campaign?

LIASSON: Sure—inside the Clinton campaign?


LIASSON: Sure. These people are realistic. And, yes, as Charles says, some exogenous event could happen, some kind of Obama collapse—but, certainly, nobody anticipates that now.

I don't think it's bad she stays in the race. I think she owes it to the people who support her. Why shouldn't West Virginia and Kentucky have a chance to vote for her?

But, as Fred said, it matters a lot how she campaigns in the final six contests. Does she say he is not fit for be commander in chief, which she has stopped saying—and, by the way, she hasn't said it since Ohio and Texas—or does she just fight the good fight, do as well as she can, and then gracefully get out?

BAIER: Percentage that she is the vice presidential pick?

BARNES: Very low. I think the Obama people are dead set against not having her as the vice presidential running mate.


BAIER: Zero chances?


KRAUTHAMMER: Ten percent.

LIASSON: Oh, Charles!

BAIER: That's it for this topic. When we come back, no one seems happy with the War Funding Bill now pending in congress. We'll take a look at who's onboard, who's not, and why.



REP. MAXINE WATERS, (D) CALIFORNIA: We have not given up. We have not been silenced. We are not afraid. We're not intimidated. And we are not going to vote for any supplemental appropriation. We don't care what domestic spending has been included in it.

REP. NANCY PELOSI, HOUSE SPEAKER: We will see next week when we come to the floor what we have. I'm very confident that next week we will come to the floor with a Bill that has the full consensus of the Democrats and hopefully can attract a large number of Republicans as well.


BAIER: There you see Democratic congresswoman Maxine Waters talking about the Iraq War supplemental, and House Speaker Nancy Pelosi who is in a bit of a pickle trying to deal with the Democratic back and forth on whether to fund the war and move forward with this.

We bring back our panel. This war funding Bill is $162 billion, Charles. And added to that, the Democrats are including extending unemployment benefits and boosting education under the G.I. Bill. Right now there is a debate inside the Democratic caucus of whether they're going to move this thing forward and how. How does this come out?

KRAUTHAMMER: The way all the others have in the past. Every six or eight months it happens. It is a charade. Pelosi knows in the end that the language in her Bill which would put restrictions on the president will be stripped out, absolutely stripped out, as it was in the past.

It is only a question of how much domestic spending she is going to shoe horn in. And that will be a negotiation between her and the Republicans, but also between her and the right wing, the middle of the road Democrats, the blue dog Democrats, who have held out on this and said you've got to have a way of paying for all this stuff domestically.

And, of course, it's not going to be a blank check. So it's the rebellion on her right, which is stopping the Bill right now.

I don't see a lot of game on the part of the blue dogs. I think it will end up with a small domestic part and the full funding of the military part.

BAIER: And of course, Mara, the attachment that U.S. troops be withdrawn from Iraq by the end of 2009 is an automatic veto threat from the President?

LIASSON: Sure. That's a gesture. The Democrats have tried that before, and they want to be on record that that's what they are for, even though they can't possibly enact that.

Look, the rule of thumb has always been, whether it's moderate Republicans or blue dogs, in the end, they always fold. The center rarely dictates things.

But it is interesting that she is caught in the crossfire between the left and right in her party. She has run a pretty tight ship up until now. She is a very strong, powerful Speaker, and I'm sure she will work this out somehow.

But I agree, that language will not be in it in the end.

BAIER: But every day the Maxine Waters of the world get out there hammering Pelosi. Is this hurting the Democrats in congress?

BARNES: I have to say that Nancy Pelosi has been so much stronger and tougher and able to hold Democrats in the House together than I thought, and certainly more than most Republicans in the House have thought, and many are now willing to admit it.

They don't agree with her. They don't like what she is doing. But she's so much tougher and stronger as a House Speaker than they imagined in their wildest dreams. And it's really true.

But, look, the stuff they want to add to this Bill is just dumb. The expanded education benefits would lure people out of the all-volunteer army. You need benefits that increase the attractiveness of staying in.

There is one thing else we know now with this extended job benefits—we don't need to. We're not going to have a recession. You have seen the numbers recently? Retail sales are up, productivity growth up, jobless rate down. Look, we're just not going to have one. It may not be a great economy at the moment, but you don't need to throw in other stuff.

I think it shows now that the stimulus package with the checks going out now, we didn't need that. Our economy is amazingly resilient. They ought to retract the stimulus package. It's unnecessary.

BAIER: Charles, what about the back and forth on the Hill reflecting on the campaign trail for the Democrats? Is there a possibility of that, a blowback from this battle reflecting on them?

KRAUTHAMMER: I think the way the Bill is crafted is to embarrass Republicans. It has stuff in there that looks real good, like helping the unemployed, helping the military returning from Iraq and Afghanistan.

This is bait. If it is defeated, as I think a lot of it will be, and withdrawn, it will be an argument for Democrats against Republicans in November. So it is intended as bait.

BAIER: Quickly, how does it wrap up?

LIASSON: I think they will eventually get something, and the offending parts will be excised.

BARNES: There will be no timetable.

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