"Well, I think it's unfortunate that too many people in politics right now want to be so politically correct that they dare not question a person's associations or their past record, or their voting record even, because they would fear that they would be called a racist," Palin said. "That's that political correctness that's going to do our country in, and I don't subscribe to that."
McCain aides said the decisions were eventually his, and that Palin had to go with the strategy of the campaign team.
"And we did go with the strategy. And we lost. And that's fine," Palin said.
But asked whether the outcome of the campaign would have been different had she been allowed to speak more freely, Palin said no.
"The economy tanked," she said. "Electorate was ready, sincerely, for change. But, no, I don't think that had I been able to bust out and really say what I felt. No, I don't think that that would've changed the outcome."
Palin has also become a vocal supporter of the so-called tea party movement, calling it "beautiful." This group of protestors, however, is staunchly against the bailout package, which Palin and McCain both supported in their campaign.
"Yep, that very first bailout, yes," she said. "Now, we have learned, too, it didn't fulfill the promises that were made by Congress, and by the White House, that bailing out these businesses that were 'too big to fail.'
"That did not put our economy back on the right track. So we learn from our mistakes. The tea party movement, beautiful. It energizes our country. More power to these people who are showing up there."
Even after last year's defeat, Palin remains one of the Republican Party's brightest stars. From Alaska, she has been weighing in on issues and influencing policy debate in Washington. She scored a major blow to Obama in August when she wrote on her Facebook page that under Obama's plan, the fate of the elderly and her son Trigg, who has Down syndrome, would be determined by "death panels."
In the interview with Walters, Palin acknowledged that "death panels" aren't part of Democrats' health care bills, but she likened the term coined by her to Ronald Reagan's cold war references to the "evil empire."
"It's kind like what Reagan used to do, though, when he talked about, say, the 'evil empire.' You're never going to find the evil empire on a map of the world," Palin said. "And yet he talked about that, in terms that people could understand -- kind of rationing down, not complicating the issue. But he, with the issue of the evil empire at the time, used those two words to get people to shake up, wake up, find out what's going on here. Now, had he been criticized and, and mocked, and, and condemned for ever using a term that wasn't actually there on a map, or in documents, we probably would never have succeeded in, in crushing the evil empire, and winning that."