This is a rush transcript from "Hannity," October 3, 2011. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: When it comes to who will challenge President Obama in 2012, well, it's still anyone's game. And a new Fox News poll proves this is true. Two new candidates edged their way into the top tier.

Now even though Mitt Romney and Rick Perry still lead the pack, Herman Cain and Newt Gingrich are inching their way up.

Now Herman Cain recently won the Florida straw poll, and this weekend kept the momentum going with another straw poll victory at the bi-annual (PH) Convention of the National Federation of Republican Women. Now, Cain received 48.9 percent of the votes cast, Perry trailed with 14.1, Romney with 14.3 and Gingrich took home 12.5 percent.

And while Herman Cain was relatively unknown to many Americans just a few months ago, he now says he's someone to be reckoned with. And he put it down in a new book so you, the American people, can know exactly who he is, where he comes from. Entitled "This is Herman Cain: My Journey to the White House."

Guess nobody else is in that journey.


HERMAN CAIN, GOP PRESIDENTIAL CANDIDATE: That was confidence, like you said.

HANNITY: Yeah, well anyway, good to see you. Thanks. Congratulations.

CAIN: Thank you.

HANNITY: You know, I've known you what? A little over 10 or 12 years.

CAIN: Ten years, yes.

HANNITY: I learned things in the book that I didn't know before and I'm going to get to it in just a second. I got to ask you a few political questions.

CAIN: Understand.

HANNITY: You said about Christie -- they're not going to vote for him in the primary, he's a liberal.

CAIN: I think he has more liberal positions that a lot of people don't know about, yet.

HANNITY: For example?

CAIN: Well, his position on if you are here illegally, that's not -- that shouldn't be a crime. Well, a lot of conservatives believe that is a crime and I've talked to some people in New Jersey who live there and they say he has a lot of liberal positions. I don't know all of them, but I think all of that will come out.

HANNITY: I thought you said judicial appointments...

CAIN: Yeah.

HANNITY: Like a lot of people -- I think the one issue that really probably has hurt Governor Perry the most is the in-state tuition issue.

CAIN: Yes, it has.

HANNITY: All right, this issue came up about Perry and you commented on the Sunday shows about it and that's about Perry, I guess he went to this hunting camp. His family never owned it, but I guess they would lease it or rent it or go there and it had painted on a rock the N-word.

CAIN: Right.

HANNITY: Now, Governor Perry's camp has said, wait a second, because you said that it was insensitive.

CAIN: The name on the rock is insensitive.

HANNITY: But it wasn't -- you weren't addressing that towards Perry.



CAIN: It was the fact that it was on the rock and whoever was in charge of the rock, it was insensitive. Now, the latest information I found, I've heard, because I haven't researched it, haven't had time, you know, more important things to do, is that in 1981 they painted over the sign.

HANNITY: The Perry family did?

CAIN: Right. So, what happened from 1960 to 1981? However long it was there. I'm not trying to figure out who was responsible for leaving it there, who painted it over, as long as it was there, it was insensitive. That was my whole point.

HANNITY: OK, so it's the word. It's the word. I got you.

CAIN: Right. And I even went so far to say this, Sean. I don't believe that that word on that rock represents how Governor Perry feels about black people in America. I really don't.

HANNITY: And this is the end of it for you?

CAIN: This is the end of it for me.

HANNITY: All right, now before I get to your book, I got to show you a tape. This is you in -- by the way, you have not aged a day. This is you in 1994. President Clinton pushing his health care plan. You're the head of Godfather's Pizza and -- we're not going to show Clinton, it's too long, but we will show you your response after he speaks. This is what you said.


CAIN: OK, first of all, Mr. President, with all due respect, your calculation on what the impact would do, quite honestly, is incorrect. Let's take, for example, the fact that after I went through my calculations, your calculation or your example of the six percent or the 7.9, and in my case it works out to 7.9 percent. Now let's suppose that 30 percent of my costs are labor costs, 7.9 times that would be the two to 2.5 percent that you're referring to. The problem with that calculation, sir, is the fact that those -- most of those 30 percent of the people currently have zero. So, when I calculate in the fact that I have to go from no coverage on those employees to full coverage at the 7.9 percent rate, it actually works out to be approximately 16 percent.

So what I'm saying and suggesting is that the assumptions about the impact on a business like mine are simply not correct because we are very labor-intensive, we have a large number of part-time and short-term employees that we do not cover for one simple reason. We can't afford it.



CAIN: Those were the facts. What can I say?

HANNITY: Well, that was a big moment...

CAIN: It was a seminal moment. And what happened after that, all of a sudden business people started to read the fine print. Different organizations, they started to say, you know what? He's right. They went back and did their own calculations. President Clinton and his administration were pushing bogus numbers and they got busted in that one spot, right there.

HANNITY: You know, you said your American dream, in your book, was to get $20,000.

CAIN: Yes.

HANNITY: All right, you have run, let's see, you worked at Coke, Pillsbury, you've worked at Burger King.

CAIN: Yes.

HANNITY: Godfather's Pizza CEO.

CAIN: Yes.

HANNITY: Most of the situations you ran were turnarounds, in other words, companies that were headed for bankruptcy.

CAIN: Yes.

HANNITY: But only wanted -- $20,000, you thought you made it.

CAIN: Because when I was growing up, we didn't have a lot of money. I can remember my dad could only give my brother and I money to eat in the school cafeteria one day a week, on Fridays, and it was 25 cents.

HANNITY: Pizza day.

CAIN: No, hot dog, apple and a carton of milk.

HANNITY: Oh sorry,

CAIN: It wasn't even pizza day. And so we would saying, you know, it would be nice to make $20,000 a year. Why? I had read somewhere that if make $10,000 a year, you could qualify for an American Express card. I wanted two of them. That was my material lifelong American dream. And I'll never forget the day that boss at the (INAUDIBLE) laboratory, when I was a ballistics analyst, called me in and said you're getting promoted, we're creating a new supervisor and mathematician position, you going to get promoted because you got your master's degree, you've done a great job.

HANNITY: He going to pay you?

CAIN: And I said, well, Wayne, thank you for the title, but what is it going to pay? And he said, 20,000 and one dollar a year.

HANNITY: You describe growing up poor.

CAIN: Yes.

HANNITY: In the segregated South. Your father had three jobs.

CAIN: Yes.

HANNITY: Janitor. What else did he do.

CAIN: Barber.

HANNITY: Your mom was a maid?

CAIN: Mom was a maid. My dad was a barber, a janitor, and a chauffeur.

Dad never complained or played the victim card. He was thankful that he had the health to be able to work three jobs. He worked three jobs until he could make it off two. He worked two jobs, once he could make it off one job. He did it the old-fashioned way. We didn't know we were poor.

HANNITY: You tell a story, the segregated South; you were out with your mom and brother, who by the way since passed away. I didn't know that until I read the book.

CAIN: Yes.

HANNITY: Where, you, you mom, you want to get a drink.

CAIN: Right.

HANNITY: With your brother. Your mom says to go get it. Tell the story.

CAIN: My mom used to go to the bargain basement of the downtown department store. That's what we could afford. So, my mom was downtown this particular time, with my brother and I. I was about seven and he was about six. And so there weren't a lot of people in there and so my brother and I said, "Mom can we get a drink of water?" And you have to go over to where the water fountain was. There was one on the left and there was a sign that said, "white," there was a sign over the other one that said, "color." And so my mom said to us, "Now, you boys make sure y'all go to the color fountain." We said, "OK, mom."

So we get to the fountain, my brother and I, and we look around, there wasn't a lot of people there and I said to my brother, "You go first." He tasted the white water and then we looked around and says, "Your turn." We tasted -- I taste the white water. Then we both taste the colored water and we looked at each other, six and seven years old, the water tastes the same. What's the big deal? We had not been taught segregation at the age of six and seven. We wondered what the big deal was about.

Now, that being said and growing in the segregated South, I am not mad at America. I don't have a grudge against America, because one of the things that has made this nation great in the short 235-year history, Sean, is its ability to change. A lot of other countries don't have that ability. We ought to be appreciative of the fact that this country has that kind of resilience.

HANNITY: We don't have time tonight, but the book, I learned -- I've known you for a dozen years, I learned a lot about you. It talks about your upbringing, the challenges in business and also a lot of your political views and I really enjoyed it and it's a great book and you're going to be on the road now promoting it a little bit as you're on the campaign trail.

CAIN: Yes. We got a book tour starting today.


CAIN: We just highlight it, kicked off on your show as promised, because you are still my friend.

HANNITY: I can't believe you're talking to me now that you're so high up in the polls. I'm amazed. That usually goes away.

CAIN: Well, we're looking forward to it, so if people go to my web site HermanCain.com, they'll know where we're going to be for the next two weeks promoting the new book.

HANNITY: All right, Herman, we'll see you out on the campaign trail.

CAIN: Thanks, Sean.

HANNITY: Appreciate it, as always.

CAIN: Thank you.

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