This is a rush transcript from "Hannity," March 1, 2010. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: The majority of Americans are calling on President Obama and the Democrats to scrap their health care reform bill and start over. But all signs are indicating this will not happen. And it appears the president plans to turn his back on bipartisanship and ram this bill down your throat.

But now even one of the president's former advisers is speaking out on the issue. Now let's take a look at what billionaire investor Warren Buffett had to say just this morning.


WARREN BUFFETT, BILLIONAIRE INVESTOR: I would try to get a unified effort saying this is a national emergency to do something about this. We need the Republicans, we need the Democrats. We're going to cut off all the kinds of things like the 800,000 special people in Florida, or the cornhusker kickback as they call it, or the Louisiana Purchase.

We're going to get rid of the nonsense. We're just going to focus on cost and we're not going to dream up 2,000 pages of other things. And I would say, as president, I'm going to come back to you with something that's going to do something about this because we have to do it.


HANNITY: All right, now, unfortunately, President Obama is not likely to take Mr. Buffett's advice, instead he plans to call on the Senate to use the nuclear option also known as reconciliation to pass the bill.

But oddly enough you won't hear Democrats using the phrase reconciliation. Nope, they have decided to re-brand the term, instead calling it a simple majority. Let's take a look.


REP. NANCY PELOSI, D-CALIF., SPEAKER OF THE HOUSE: What is the Senate able to do with a simple majority.

SENATOR ROBERT MENENDEZ, D-.N.J.: There may be the ability to proceed on a simple majority vote.

PELOSI: What you call a complicated process is called a simple majority.

REP. CHRIS VAN HOLLEN, D-M.D.: A majority in the United States Senate gets to make a decision.


HANNITY: And joining me now with reaction to the Democrats' latest tricks is Fox News contributor, the one and only architect, Karl Rove.

• Watch Sean's interview

Karl, all right, does the changing, shifting term — does that help? Does that work?

KARL ROVE, FORMER BUSH ADVISER: No. For two reasons. First of all, I understand why they don't want to say we're changing rules midstream, but they are. It's rather than reconciliation they're using silly recreation.

We're going to have a simple majority. Let's blah, blah, blah. But look, here's the problem. Before the Senate would ever get a chance to use reconciliation, I think what's going to have to happen is, is that the House is going to have to pass the Senate bill. Because you can't use reconciliation in order to fix a proposal.

You can only use it to fix a bill that's passed Congress. And so far the Senate bill has only passed the Senate, it has not passed the House. So before we ever get to the Senate taking up their own bill and trying to fix it, they're going to have to have the House take up the bill and pass it.

And then during a 10-day period before the president is obligated to sign or veto a bill, they're going to attempt to ram through reconciliation. But let's not underestimate how difficult it's going to be for Speaker Nancy Pelosi to pass the Senate bill. After all, you know, they haven't been able to do it thus far and what makes us think that it's going to be better for them to pass it now?

It's going to have all the stinky stuff in it, the bad abortion — the bad language on abortion. It's going to have the bad language from the perspective of union members and liberals of the tax on Cadillac insurance plans. And it's very difficult for them to get that done.

• Great American Blog: Do you think Obama should take Buffett's advice?

HANNITY: All right, Kent Conrad, a Democrat, was on "Face the Nation" this weekend. He said look, reconciliation is not going to work here even as it relates to the Senate.

Why don't you explain why the process is so hard?

ROVE: Well, the process is so hard because reconciliation has been used for adjusting numbers. For adjusting budget and tax numbers. It was originally passed in 1974 as the Budget Reconciliation Act. But you can't use it to create new policy. So you — that's why they can't use reconciliation to, say, insurance companies have to take if you got a preexisting condition.

Or we're going to use reconciliation to create the exchanges. You can't do that. You have to — you can only use it to, in essence, turn the dials, if you will, on things involving dollars, whether it's spending or taxes.

And so you can't create new policy. That's why they have to pass, in my opinion, a bill through — take the Senate bill and pass it through the House.

And, Sean, just to give you a sense of how complicated this is, that bill - - the House passed health care 220-216 last year. They've lost three Democrats through retirements or death. The one Republican voted for the bill last fall said, I ain't voting for the Senate bill, now it's 216-217, it's going down.

Then you got Bart Stupak in Michigan saying if the abortion language that the House have, the pro-life language is not in there, I'm voting against it. There's a bunch of other Democrats have similarly voted for the bill only because Stupak was in it.

I don't know how many that actually is. I'm taking it as the number there are eight. Blue Dog Democrats who said they voted for the bill because it had the Stupak abortion language in it.

Let's say half of them flake. You're down now to 211-220, the bill is going down by nine. And then there are two other groups here that may have people voting against the bill, and those are the people who say, I don't want to use reconciliation.

And the people who say look, this bill is stinky, I voted for it last year, but now I'm in a district that Bush or McCain carried, and I'm going to go down if I vote for this again. So, you know, where are they going to get them —

HANNITY: All right.

ROVE: — They're 39 Democrats who voted against this, four of them are liberals. That's where I think they start to make up. The four liberals.

HANNITY: All right, if that's the case, this is done. This bill then, therefore, has been defeated, has it not?

ROVE: Well, only — just remember we have a big player in this. Speaker Nancy Pelosi. She can bring in those members and say look, if you are expecting — you voted against it and we were willing to let you do that last fall. But if you vote against it this time there will be a cost to it.

She could say we're not going to be supporting you from the Democratic Congressional Campaign Committee. You are not going to have a pleasant future here in this body. You're not going to get the committee assignments, or the earmarks or the special help that you think you need.

She can say to senior members, you know what? Your committee chairmanship can be in jeopardy because like Ike Skelton, Armed Services Committee — you vote against this and I'm not going to be able to keep the left from voting in the caucus to kick you out as the chairman of the Armed Services Committee.

HANNITY: All right, and I have a spy, if you will. Somebody who just passed on a little information to me. And this person was listening in on a conference call with Nancy Pelosi's chief of staff late last week.

Now I assume you're pretty well connected, you might be aware of what happened. One of the things that came out of this — now they're pretty confident, in spite of what the numbers, the reality of your numbers — they seem to be confident they can get this through.

What they're most afraid of it seems is that their fellow Democrats will go home for Easter recess and they're going to get hammered just like they did in August. So is there really a deadline here the end of this month?

ROVE: Yes, you're referring to John Lawrence who is —


ROVE: — Pelosi's chief of staff. And on this conference call he said we have to get this done by the end of March because if members go home for Easter break, they are going to get beat up like last August and they're going to come back and not be willing to support this.

Isn't this amazing? The Democrats have a 255-178 margin in the House of Representatives and the chief of staff to the speaker is saying we got to get this done before the members have interaction with their constituents back home, otherwise this bill is going down.

I mean CNN poll last week said 25 percent of Americans want the bill to be passed, the Senate bill to be passed, 48 percent said, you know, start over. Bipartisan effort. And 25 percent said don't do anything.

I mean we got 73 percent of the American people saying don't do this and John Lawrence — he obviously read that poll because he said we got to get it done before members go home and meet real people who are going to have — be really angry about this.

HANNITY: All right. We're going to get into this a little more detail on the show. Nancy Pelosi promised the most ethical Congress in history. She talked about draining the swamp. If you remember. There's a big controversy over Congressman Mark Foley.

Now we've got the issue of Charlie Rangel, we've got cold cash Jefferson. She actually — in trying to defend Charlie Rangel this weekend, who was found guilty of ethics violations, you know, said, well he didn't jeopardize our country in any way.

So do the Democrats now politically have ethics as an issue for them going into the midterm?

ROVE: I think it's starting to emerge because it was not only Charlie Rangel, what got me was, there were five other members — Democrat members who participated in the same corporate junket that Charlie Rangel did who were excused by the Ethics Commission because they said well, they obviously didn't know — their staffs didn't know like Charlie Rangel's staff knew.

But look, what I understand is this conference was — you walk in to the room and it had big signs thanking the corporate underwriters for it. So - - and we also had an ethics committee staffer who was leaking information and leaking guidance from the ethics committee to people during this process.

So I think yes, we're starting to see it. We're going to see more of it. And look, we saw it last in the vote. I mean it may not be the same kind of violation of law that, say, Mark Foley had or that some members had with their dealings with Jack Abramoff, but it is morally wrong for members of Congress, I think, to predicate their votes on a big important issue like this on how much, you know, "gimme they get."

Yes, I want money for my state and I want you to give a particular company a special benefit, mutual of Omaha against its Medigap (ph) policies treated in a different way than everybody else. Or mutual Blue Cross of Michigan because it's a union-run thing gets a deal, you know.

If we're union members we get out from underneath the special Cadillac insurance plan tax. And if you're a nonunion member you get stuck with it. And the difference — the only difference between those two people is that, one is a political — part of a political ally of the president, one is not.

I mean this is just wrong. And people are starting to get really concerned, I think, about how Congress is approaching its duties. And Nancy Pelosi didn't do herself any good by defending Charlie Rangel. He ought to be out as Ways and Means Committee chairman. If she was serious about draining the swamp, she ought to start there.

HANNITY: All right, Karl Rove, good to see you. Thanks for being with us.

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