On Tuesday’s CBS Early Show, co-host Harry Smith interviewed Hillary Clinton on the government’s financial bailout plan and quoted Democratic talking points: "Is there a sense of urgency? Dick Durbin went into the well of the Senate the other day and said ‘why does this feel like Iraq all over again? Why does there feel like there has to be a rush to get this done?’" Clinton replied: "Well, something has to happen because of the neglect of the administration in handling this problem in the past. You know, you covered the campaign. I talked about this for 18 months. I said this is coming."

One question that was absent from the interview was why Clinton pulled out of a rally protesting Iranian President Mahmoud Ahmadinejad addressing the United Nations this week. In a report by correspondent Bill Plante that immediately preceded Smith’s interiview, Sarah Palin being dis-invited from the rally was mentioned: "In New York, thousands protested Ahmadinejad's pro-nuclear, anti-Israel stance. A rally at which John McCain's running mate Sarah Palin had been scheduled to speak before her invitation was withdrawn." That occurred after Clinton decided not to attend the rally because of Palin’s attendance, yet Smith did not ask the New York Senator about the issue.

However, Smith did ask about Palin: "Do you think Sarah Palin's being treated fairly?" Clinton took a deep breath and replied: "Look, I think that any woman in politics, at the level of presidential and vice presidential politics, is going to run into a lot of the same, you know, issues and questions, but the bottom line is who is on the top of the ticket?" After Clinton responded Smith took note of that breath: "I love the [Mimics Clinton's deep breath and laughs]. Pleasure to see you, thank you."

Here is the full transcript of the segment:

7:00AM TEASER:

JULIE CHEN: A rattled market awaits its bailout. Can lawmakers reach a deal to avert turmoil? What does Hillary Clinton think? We'll ask her in a live interview.

7:01AM TEASER:

HARRY SMITH: We're actually across town in the CBS broadcast center and we have a guest with us this morning. Who you'll get a chance to hear from in just a couple of seconds. Senator Hillary Clinton is with us this morning. And lots to talk about, and we will talk in just a bit.

7:02AM SEGMENT:

HARRY SMITH: We are in New York this morning with Hillary Rodham Clinton. Senator, we want to talk about this bailout, this $700 billion bailout. Liberals have their doubts, conservatives have their doubts. I want to talk about some of the sticking points, including executive compensation. Should all of this money go to these giant Wall Street corporations and the executives still be paid what they were going to get paid before?

HILLARY CLINTON: Harry, we cannot give the firms a blank check. We can't give the Treasury a blank check. You know, taxpayers need to have some control over the purse strings and not be left holding the bag and that's what the negotiations are really all about. I think most people have reached the consensus that we have to do something unprecedented for intervening into the markets like this. But what we also have to do is make sure that homeowners get some relief, that it's not just for the banks and the lenders. That we have some checks and balances, and not a blank check, that we also begin to the look the root cause of this, which are these mortgages that people can't afford that many of them were sold without adequate information, understanding. And begin to rewrite those so we don't continue down this path. And I have put forth a proposal that I've been working on and actually talked about parts of it during the campaign, that says we need something other than just investing our Treasury Department with all of this authority.

SMITH: Right.

CLINTON: Let's go and see what worked in the past.

SMITH: Sure.

CLINTON: Franklin Roosevelt did a pretty good job creating-

SMITH: The Homeowners-

CLINTON: -the Homeowners Loan Corporation. It helped people stay in their homes, stabilize the housing market during the Great Depression. The Treasury ended up making money, but that was a group of people dedicated to just that task. So I think we're going to have to create something like that once we get through this immediate crisis.

SMITH: Yeah. Is there a sense of urgency? Dick Durbin went into the well of the Senate the other day and said 'why does this feel like Iraq all over again? Why does there feel like there has to be a rush to get this done?' Richard Shelby on the other side said this is neither adequate nor -- does this have to happen this week or by next week?

CLINTON: Well, something has to happen because of the neglect of the administration in handling this problem in the past. You know, you covered the campaign. I talked about this for 18 months. I said this is coming. We've got a big problem, we've got to figure out what to do about these mortgages, we have to rein in the banks, we need new regulation. And I remember, having said that, I gave a speech on Wall Street last December making some of those points and the administration basically brushed me off, said, 'you know, she's wrong, it's contained.' Well, they were wrong. So now we've got the crisis. The house is on fire. Yes, we got to call the fire department, we got to put the fire out, but for goodness sake's, with he need to then take a step back and say why did this happen? We can't ever let it happen again. But I think that the calls for being careful about this, coming from the Congress, are absolutely right. The markets do need to be stabilized and there's a lot of psychology in the markets. You know, people are all worked up, they're selling stuff that -- because they aren't sure what is going to happen next, so we've got to stabilize the markets, but I really respect what my colleagues in Congress and I are trying to do, which is to say to the administration, 'look, you got to do some additional steps here. This is not going to be enough and we don't like giving you this much authority with no accountability.'

SMITH: Right.

CLINTON: So we're working that out.

SMITH: Just over 40 days to the general election.

CLINTON: That's right.

SMITH: Who's going to win?

CLINTON: Barack Obama's going to win.

SMITH: No doubt in your mind?

CLINTON: No doubt. And here's why, if anybody looks at the mess we're in today, why would they reward the Republicans? I mean, that makes no sense to me at all.

SMITH: John McCain would say 'I'm a maverick, I've always stood away from these guys, they're not me.'

CLINTON: Well, I have a lot of respect for Senator McCain, he's a friend of mine, but his record is continuing efforts for deregulation and beginning to, you know, try to get the market to take even more responsibility, including even for health care, which his health care plan suggests. So I think we should look at what's worked in the past. Democrats have done it before. We saw what my husband did. Barack Obama is being advised by the same people who got us out of the ditch in 1993, after 12 years of Republicanism.

SMITH: But as close as these polls are, some people say it's going to end up, this is -- the real -- it's going to hinge on gender. Some people say it's going to hinge on race. Should Barack Obama have chosen you as a running mate?

CLINTON: You know, he had every right to choose who he wanted to choose and he made a great choice. Joe Biden's a friend of mine and he is a champion of working people, he is a great strategist about the world. I think our ticket is well equipped for handling the mess they're going to inherit, because make no mistake about it, this is going to be one of the most difficult presidential transitions, because of everything that President Bush has done to our country's detriment. And I think that, you know, Barack and Joe are ready, they're ready to lead, they're ready to make these tough decisions and that's what the country desperately needs.

SMITH: What about the issue of race, because this new poll came out from Stanford and from Yahoo talking about this notion that there's still a lot of Americans who might say publicly one thing and do something privately.

CLINTON: Well, race and gender were issues in all of the polling and in the primary campaign. That is, you know, just a fact of life. But when it comes to making this important decision that voters have to make, I think the vast majority of Americans are not going to look at anything other than what's the best choice for me and my family and my country. And the choice is so clear. You know, I've campaigned all over for Barack. I've been to Florida, Ohio, Nevada, New Mexico, from, you know, New Hampshire to California, and I always say to people, I know how interested you are in this election, but instead of asking each other who are you for, ask who is for you? And there isn't any other answer, except Barack Obama and Joe Biden.

SMITH: Very quickly. Do you think Sarah Palin's being treated fairly?

CLINTON: [Takes deep breath] Look, I think that any woman in politics, at the level of presidential and vice presidential politics, is going to run into a lot of the same, you know, issues and questions, but the bottom line is who is on the top of the ticket? And Senator McCain, with all due respect, is a Republican. We have seen what the Republicans have done to our country. Here at home and around the world. And I think that voters have to ask themselves do we really want four more years of eight more years of the same?

SMITH: Alright. Senator Clinton, thank you so much.

CLINTON: Thanks.

SMITH: I love the [Mimics Clinton's deep breath and laughs]. Pleasure to see you, thank you.

CLINTON: Thanks, Harry.

—Kyle Drennen is a news analyst at the Media Research Center.