KING: Welcome back.

New York's Governor David Paterson has been dogged for weeks now by rumors of womanizing and illegal drug use. He says the charges are unfounded and vows that he will not be driven from office. He plans to run for another four-year term in November.

He joins us now with things like the "New York Post's" "I did not have sex with that woman." "The Daily News," "Captain Chaos." "Newsday," "Only Voters Can Oust Me."

What's going on, Governor?

GOV. DAVID PATERSON (D), NEW YORK: Well, Larry, you're right. For the last two weeks, I've been depicted in unflattering ways. The predicate of all of this is a "New York Times" profile piece --

KING: Not yet printed.

PATERSON: Not yet printed. But was described by aspects of the media sourcing the "Times" as being a bombshell that will drive the governor out of office because of a scandal.

Now the information that was justifying this predicted outcome manifested itself in salacious and outrageous charges that only uninformed sources could produce.

KING: I want to get to -- for the record a spokeswoman for the "Times," Diane McNulty, has told us this. "We didn't start the rumors about the governor. We haven't trafficked in those rumors.

And the "Times" metropolitan editor Joe Sexton says, quote, "Obviously we're not responsible for what other news organizations are reporting. It's not coming from the 'Times.'"

PATERSON: Well --

KING: What do you make of that?

PATERSON: They said the same thing to me when I talked to them several times and I take them at their word.

KING: So nothing's been printed. So?

PATERSON: They didn't start the rumors when they sat down with me for an hour and a half to talk about the profile piece. They did not ask me questions about any of this. But I would think -- look, I'm going to leave for the journalist like yourself and other analyzers of the media to come to a conclusion.

I'm not a journalist. But I am an elected official. And I think I have a right to say this. The human decency, if not journalists ethics, I think would compel an organization when they see a person being slandered for over two weeks now -- I've been waiting for three weeks for this article to come out -- to clear the air and at least say that the charges that are being made are not in the perimeters of our investigation.

KING: So you're saying "The New York Times" should print something tomorrow?

PATERSON: I wish they would so I could be out of my misery because the reality is that these charges have been unsubstantiated. They are speculations. And Larry, it's like a Kafka-esque scenario that --

KING: Let's get rid of them then. All right. Chance to set the record straight.

PATERSON: I've set the record straight.

KING: One by one. PATERSON: And I don't want to do that. And I'll tell you why. Because I've already denied these charges in several media outlets. And I think every time I even address the charges I give them momentum. There was no source, there's no one that said any of this.

KING: Well, the "New York Post" -- they said that about 10 weeks ago a trooper -- a state trooper caught you snuggling with a woman in a closet at the governor's mansion. They quoted a police source saying the trooper opened the door. First thing he saw was the governor and a woman inside. Two of them snuggling together, embracing.

Nothing more than that. Snuggling and had their clothes on. Is that a false story?

PATERSON: It's not only a false story, Larry. But there is no such closet as they described in the executive mansion and there are no troopers in the executive mansion. The troopers do not patrol or check inside the mansion at any time.

KING: Who's after you?

(CROSSTALK)

PATERSON: You know something, Larry? I won't kid you. I think I have thought about who might be after me, but for me to speculate about it would be as wrong as the speculations that were made about me.

I can't prove it. I don't know who it is. Maybe those in the media might check their sources more. Maybe those in the media might investigate why the sources are saying what they're saying.

But until that time I'm not going to commit the same act that has injured me.

KING: Do you think it's some sort of plot, conspiracy against you? A group, a person, an -- what?

PATERSON: Larry, I --

KING: What do you think? What goes through your mind? We won't name names. Is somebody after you?

PATERSON: Well, clearly somebody is. Three different media outlets were contacted in the first quarter of the Super Bowl and they called us before the first quarter could end to confirm that the governor's resigning over a scandal. And there was no such conversation about resigning because none of this is true. It's a flat-out lie.

But what I would say is that what this has happened in the last two weeks, it's distracted us from one of the most difficult deficits we've had in our time. Our sources are depleted. Our revenues are depleted. We've cut $33 billion in the two years I've been governor. It is four times as much as any governor ever cut in a similar period of time.

And we need to be focusing on how we're going to balance our budget and not be put in the place where other states are.

KING: Let me get a break.

Governor Paterson, by the way, is here the rest of the way. We'll have a Clinton update next. Don't go away.

(COMMERCIAL BREAK)

KING: We're talking to New York Governor David Paterson about the rumors swirling around him. We've got some more questions for him.

But first let's check in, get the latest on the Bill Clinton breaking news with CNN's Mary Snow at New York's Columbia Presbyterian Hospital. Mary?

MARY SNOW, CNN CORRESPONDENT: Larry, President Clinton is said to be up and walking around. He was described as being in great spirits. Secretary of State Hillary Clinton and her daughter Chelsea also here at the hospital tonight.

President Clinton's cardiologist said that President Clinton had felt discomfort in his chest for the past couple days that he came in. When tests were done it was found that this bypass graft stemming back from his surgery in 2004 was blocked and he was treated with two stents.

Now his cardiologist said the procedure lasted about one hour today and that the president was back and up at about two hours after that. That his prognosis is said to be excellent.

And his doctor also stressed that there was no sign of any heart attack. And he also stressed that this was not a result of his lifestyle or diet which he said were excellent. And President Clinton is said to have gotten the green light to go back to work on Monday. Larry?

KING: Thank you, that update from Mary Snow. President Clinton will be released from the hospital hopefully tomorrow.

We're back with the governor of New York, David Paterson. Just after the governor was sworn in, he went public with this admission about the past. Let's get rid of that and listen to it.

(BEGIN VIDEO CLIP)

PATERSON: I betrayed a commitment to my wife several years ago and I do not feel I betrayed my commitment to the citizens of New York state. I haven't broken any laws. I don't think I've violated my oath of office. I saw this as a private matter, but both of us committed acts of infidelity.

(END VIDEO CLIP) KING: You have an open marriage, Governor?

PATERSON: No. We were separated actually at the time.

KING: Why did you go public with that?

PATERSON: I went public with it because since I become governor overnight, and the state was already alarmed, we had a duel crisis. We had a fiscal crisis going on at the same time as the government crisis.

I thought the open and transparent way to address it, and my wife thought so, too, is that we've been separated during our marriage. And we wanted to clear that up.

KING: Fair enough.

PATERSON: And I cleared up a few other things, and I thought at that time it was the right thing to do and I still do. However, the basis of those admissions I have always thought have created a feeding frenzy that any time anybody has a problem with me they go to those revelations under --

KING: Would you --

PATERSON: What I think is a premise --

KING: If you could go back in time would you not have said it?

PATERSON: I think it was right to say it.

KING: OK.

(CROSSTALK)

KING: What do they have with you? They report two witnesses saw nuzzling the neck of a family friend at a New Jersey steakhouse. The "New York Post" seems to have a daily headline.

PATERSON: Larry --

KING: You think they have it --

KING: Larry, I've already addressed that. Several people in the restaurant contacted our office. The manager threw two "New York Post" reporters out for harassing two people that they later used as sources. And the sources told the manager of the restaurant that he's trying to put words in her mouth. So this is --

KING: Why is the "Post" after you?

PATERSON: Well, I'm on a pretty big list of people the "Post" has big problems with.

(LAUGHTER)

KING: OK. What about -- and this is --

PATERSON: What I would say, Larry, is our state had a change in leadership in a rather shocking way a couple of years ago. And I think people have still a sort of sensitivity to that to the point that people would tend to believe anything they hear these days. And that opens the door for these kinds of scurrilous rumors that only uninformed kind of sources could produce.

KING: Let's deal with the serious allegations that you might put away or discuss. The question of drug use. Have you been ever a drug user?

PATERSON: I denied that just the other day. When I was younger in my 20s, I did try it -- drugs.

KING: What's your wife -- how's your wife handling all this? How are your children handling it?

PATERSON: I think my wife sets an example for me. She seems to be one of those people who can walk through walls and has a real indomitable spirit. So I kind of borrow from her.

Of course, your children, that's the reason when we were separated that we never really discussed it or publicized it and never told our children that we were having these problems because the unfortunate effects of separation, adult problems, manifesting themselves in the lives of children is what we wanted to avoid.

And we agreed that if we ever got to that situation, we agreed when we got married that that's how we'd handle it.

KING: How old are you children?

PATERSON: My daughter is now 21 and graduating from Ithaca College in New York, and my son is in high school.

KING: How are they dealing with this?

PATERSON: I think they have become immune to these kinds of attacks and scurrilous charges.

KING: You think your eyesight has an effect on the way you can challenge some of this? The fact that you can be -- not a pun intended -- blind to this? Because people have to read these headlines to you, right?

PATERSON: Well, that's true. I mean I don't think my legal blindness has anything to do with this.

KING: No, not to do with the problem. To do with the way you can respond to the problem.

PATERSON: Well, I would say that my disability probably causes me to look at life through a different prism and really at times when I never thought I would finish college, at times I never thought anyone would hire me, the anxiety I went through at that particular time is far more manifested than going through this today.

KING: Do you think it makes you tougher?

PATERSON: I think that overcoming challenges makes everyone tougher.

KING: We'll be right back with the governor of New York. Don't go away.

(COMMERCIAL BREAK)

KING: Anderson Cooper is standing by in Port-au-Prince, Haiti.

What's up tonight, Anderson?

ANDERSON COOPER, CNN ANCHOR: Larry, obviously, we're going to have continuing coverage of the condition of former President Bill Clinton. As you know, he's still hospitalized as you've been covering. We'll take -- we'll get the latest on his condition.

We'll talk to Paul Begala, David Gergen, and Dr. Sanjay Gupta about the former president's health and about what this may mean for his work moving forward. In particular his work here in Haiti.

We also got a lot of stories from Haiti. The latest on those 10 American missionaries still in custody. A lot of rumors today that they might be released. That did not happen. Some of the Haitian government officials saying they -- some of them at least could be released in the coming days. We'll get the latest update on that.

And we're also going to introduce you some American missionaries who are doing everything right in Port-au-Prince. Working with the Haitian government. Not trying to take kids out of the country illegally. But trying to help the kids who are here now live better lives here by supporting families and by supporting orphanage.

We'll show -- take you to a remarkable orphanage. We're going to meet some great kids and see the work that these American missionaries and their Haitian counterparts are doing to save lives and give new lives to a lot of very needy kids -- Larry.

KING: Anderson Cooper, 10:00 Eastern, 7:00 Pacific.

We're with Governor David Paterson.

Are you surprised that more fellow Democrats aren't coming forward to support you?

PATERSON: I think they are. I'll tell you what, Larry, when I came on the show tonight I knew that I'd get asked about the scurrilous unsubstantiated rumors that I shouldn't even have to answer because they're not even sourced.

But the reason I came on here tonight is I wouldn't want anyone, no matter who they are, to be subjected to what I've gone through in the last few weeks, particularly when they're informed that there's no remedy for this.

So I think that Democrats and Republicans -- this isn't a political issue. This is an issue about fairness. This isn't good for people. This isn't good for elected officials. And it sure isn't good for people who would think of running for office in the future that they'd be treated this way.

KING: What is the remedy?

PATERSON: I think the remedy is fairness. I think the remedy are standards. I'll leave to you and your journalistic colleagues to determine what they are. But for me, the remedy is to try to get New Yorkers and this country back on the real issue that New York is basically flat broke.

We are struggling for survival living on the margins of our means. We're going to have to learn that we can't spend money that we don't have. And that's what we're doing in this budget process.

KING: He hasn't announced yet, but everyone expects the attorney general, Andrew Cuomo, son of a former governor, to run for this office. Has he said anything at all publicly about what you're going through?

PATERSON: Not that I'm aware of.

KING: Do you expect him to?

PATERSON: No. He hasn't said much about anything in the last year. That's the new political strategy in America. You sit back and let everyone else fight the real serious problems and sail in perhaps if it's permissible and get elected.

KING: Why they reported last year that the White House urged you to drop out of the race in favor of Cuomo? Did that happen?

PATERSON: No, they actually did not. And the sources said they did but the individual who was sent to tell me to get out of the race said on the record that he didn't ask me to do that.

KING: Have you ever thought with this -- have you ever thought of saying, hey, I don't need this. Good-bye.

PATERSON: Larry, I think anybody that's in an anxious situation feels that way but there are so many situations that are more challenging than this in my life that I feel that you fight your way through these problems.

I think you stand up for what you think is right. I think you do what you're called upon to do. And my purpose is to continue to talk about the fiscal condition of my state and my country and hope that more people will hear it so that we leverage ourselves and discipline ourselves so we don't go further into this recession than we're already in.

KING: No plans to resign? PATERSON: Larry, when you hear I've resigned it means you've been invited to my funeral.

KING: Are you definitely running for re-election?

PATERSON: I'm announcing on February 20th.

KING: That are you running?

PATERSON: That I'm running for re-election.

KING: And you're positive that nothing of this is ever going to come forward and prove true?

PATERSON: I've already --

KING: Because all your friends pray that none of this is true.

PATERSON: Asked and answered.

KING: We'll be back with our remaining moments with Governor -- that sound like "Law and Order."

(LAUGHTER)

KING: We'll be back with Governor David Paterson right after this.

(COMMERCIAL BREAK)

KING: Saying goes that perception is reality, Governor. If perception is reality, do you think you're hurting your party?

PATERSON: No. Not at all. Because reality is real. And none of this we've talked about is real.

By the way, Larry, I'd just like to say that I'm very happy that President Clinton is recovering. I hope he comes on your show tomorrow to dispel the latest rumor denying that I had anything to do with his heart condition.

(LAUGHTER)

KING: Pretty cute. Cute, David.

Eliot Spitzer was forced to resign. What is with this office and sex allegations? Is this part of the New York governor -- never heard about Mario.

PATERSON: I think this is a carryover from that situation.

KING: Really?

PATERSON: I think that's actually victimized me. And -- but what we're trying to do is to make sure that the state is solvent which is a lot more important than these ridiculous -- KING: How is all of this, though, frankly, impacting ability to govern? Got to impact it in some way.

PATERSON: It's certainly been a distraction in terms of the media, as I try to get my message across, but for me, you have to learn to tune these things out particularly when they're not true and not give it any more time or energy than it actually deserves.

Because that's the whole notion. That's the reason that I'm being attacked, to try to distract me and try to get me not to run for office.

Well, I'm running for office and I hope that all those who are making up rumors will probably make some more up.

KING: But you agree that "The New York Times" is one of the most distinguished journalistic publications in the world?

PATERSON: From the time I was a child I thought that they were really the paragon of ethics and journalistic virtue.

KING: I've never heard anyone say "The New York Times" is out to get someone. So -- and this story, they say, is based on what -- nothing they've said because they haven't printed it yet. And they're still working on it. They called you today with questions.

PATERSON: Well, they asked me a lot of questions about the story. And I am not accusing "The New York Times" of being out to get me. I felt that "The New York Times" owed me for common decency or perhaps professional journalistic ethics -- that they would clear the air so I wouldn't be subjected to these rumors that I've had to deny and not one of them has a source.

KING: So are you calling on them to print something to straighten out this matter?

PATERSON: Well, I hope they'll print this article soon so that we can get back to the business of the state, but I don't have any control over that.

KING: Who's writing the article?

PATERSON: A -- an Albany bureau chief, Danny Hakim.

KING: Have you asked him when they intend to print?

PATERSON: Yes.

KING: And what did he say?

PATERSON: They're not sure.

KING: Do you expect it soon? I mean do you have some expectation from them?

PATERSON: Well, I don't know when the article is going to be printed, but I will really not worry about it. What I'm worried about right now is the fiscal condition of my state and that's my priority as I try to get a budget passed by the deadline.

KING: Thank you, Governor. I hope the rumors that Bill Clinton did hear about this got so upset.

(LAUGHTER)

KING: That he had to have two stents put in just because he's worried about what they're doing to you.

Thank you, David.

PATERSON: That would be my highest honor.

(LAUGHTER)

KING: Governor David Paterson.