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CNN "The Situation Room" - Transcript: Rift in the Republican Party

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BREAK IN TRANSCRIPT

BLITZER: A lot of people believe that. Jim Acosta reporting for us. Thanks very much.

And as Jim just mentioned, those Republicans internal battles are heating up, including one of the favorites of the Tea Party, Senator Rand Paul and the New Jersey governor, Chris Christie.

(BEGIN VIDEOTAPE)

BLITZER: And Senator Rand Paul of Kentucky is joining us right now. He's a member of the Foreign Relations Committee, Homeland Security, Government Affairs. He's got a busy job up there on Capitol Hill.

Senator, it looks like the war of words between you and Governor Christie heating up once again today. I want you to listen to what the New Jersey governor said about you today.

(BEGIN VIDEO CLIP)

GOV. CHRIS CHRISTIE (R), NEW JERSEY: So if Senator Paul wants to start looking at where he's going to cut spending to afford defense, maybe he should start looking at cutting the pork barrel spending that he brings home to Kentucky, um, at $1.51 for every $1.00 and not look at New Jersey, where we get $0.61 for every $1.00. So maybe Senator Paul could -- could, you know, deal with that when he's trying to deal with the reduction of spending on the federal side. But I doubt he would, because most Washington politicians only care about bringing home the bacon so that they can get reelected.

(END VIDEO CLIP)

BLITZER: All right, so are you going to take his advice, Senator?

SEN. RAND PAUL (R), KENTUCKY: This is the king of bacon talking about bacon. You know, we have two military bases in Kentucky. And is Governor Christie recommending that we shut down our military bases? He wants to be this great champion of national defense. What does he want to do, shut down military bases in Kentucky?

No, what this debate really is about is that in order to have enough money for national defense, which I think is a priority for the government, you have to be willing to cut spending in other places. And Governor Christie and others have been part of this gimme, gimme, gimme, gimme all this money.

And the thing is is that we could have done the relief for Sandy in a responsible way. I proposed that we do it year by year, $9 billion in the first year. And I would have offset that with spending cuts in foreign aid. I think we can take care of our country after a national disaster, but only if we're not sending billions to Egypt and Pakistan.

So really, the question is, where is the money going to come from that the governor wants? Gimme, gimme, gimme, all this federal money, but where is it going to come from if he's not willing to cut anywhere?

I am willing to cut. So for him to accuse me of pork barrel spending, I'm probably the most fiscally conservative member of Congress. I have a budget that balances in five years and I actually am allowed and able to provide some money back for the military and avoid the sequester because I eliminate several departments of government.

He's making a big mistake picking a fight with other Republicans, because the Republican Party is shrinking in -- in New England and in the Northeast part of our country. I'm the one trying to grow the party by talking about libertarian ideas of privacy and the Internet. And attacking me isn't helping the party. He's hurting the party.

BLITZER: He's obviously angry at you for twice voting against the supplemental assistance package to New Jersey residents as a result of the Sandy super storm, as you will, even though you -- you would support federal assistance to Kentucky residents who suffer from a tornado or from a flood, for example.

PAUL: Well, where he's mistaken is, is that I did vote for Sandy assistance. I voted to make it year by year. I had my own amendment, in fact, to Sandy, which would have given it year by year, which would have had adequate oversight, which would have eliminated, you know, fisheries in Alaska and all of the other pork barrel stuff they stuck on the bill.

BLITZER: Are you willing to take the same position, Senator, when it comes to emergency assistance --

PAUL: Absolutely.

BLITZER: -- to residents of Kentucky?

PAUL: Absolutely. If we have a disaster in Kentucky, I'll vote for the aid, but I will vote to offset the aid with spending cuts from another part of the budget.

BLITZER: He went after you the other day, earlier, by suggesting that you were only interested in what he called these esoteric debates.

Here -- I guess here's the question.

PAUL: (INAUDIBLE).

BLITZER: Are we on the --

PAUL: (INAUDIBLE).

BLITZER: -- are we on the eve of a -- of a Republican contest right now, for the prop -- for the presidential nomination, let's say, between you and Christie?

PAUL: You know, who knows?

I -- what I would say is that I want to grow the party bigger. And so I don't think The Bill of Rights is esoteric. I don't think the Fourth Amendment is esoteric. And I think the idea that we should have a right to privacy is not esoteric to a lot of people in our country.

Ask, uh, any people who have cell phones whether they want the government to willy-nilly be going through all of their records without a warrant. I think most Americans would say hey, I'm OK with spying on terrorists, but I'm not so excited about them spying on Americans.

So I think he's on the wrong side of history here. And I think they're getting desperate because, actually, our movement within the Republican Party is growing and the old stale, moss-covered, you know, let's go bomb everybody into oblivion, that kind of attitude in the Republican Party, I think, is actually shrinking.

BLITZER: Well, Peter King, the congressman from New York, who's also thinking of running for the Republican presidential nomination, he goes after you on many of the national security and international issues. And he -- he said this. I'm going to play the clip and then you can -- you can respond.

(BEGIN VIDEO CLIP)

REP. PETER KING (R), NEW YORK: He said the party will go in the right direction, the country will go in the right direction and we can have a healthy debate with two legitimate candidates, not the fringes, like Rand Paul in, uh, 2016.

(END VIDEO CLIP)

BLITZER: Fringes --

PAUL: Yes --

BLITZER: -- that's what he's calling you.

PAUL: Well, what I would say is, you know, it's a similar wing of the party, if not the same of the wing of the party. It's the tax-and- spend liberal wing of the Republican Party. They're all for blowing up stuff. They're all for getting involved in wars. But they're not too conserved with -- concerned with fiscal responsibility and balanced budgets.

There's nobody up here who's more fiscally conservative or who's produced more balanced budgets than I have.

And I also, in doing so, have set out that national defense is the number one priority of our country. It is constitutional. And I've said absolutely, without question, I'll do everything within my power to save money in other parts of the budget in order to have a strong national defense.

(END VIDEOTAPE)

BLITZER: We'll going to hear much more from Senator Rand Paul in just a minute. I'll ask him if he's willing to accept President Obama's so-called "grand bargain" on jobs and taxes.

And later, I'll compare my trip to North Korea with the CNN correspondent Ivan Watson, who is just back from a rare visit himself. So, has anything changed over the past two-and-a-half years?

(COMMERCIAL BREAK)

BLITZER: Now more of my interview with Senator Rand Paul of Kentucky, including his reaction to a new offer to Republicans today from President Obama.

(BEGIN VIDEOTAPE)

BLITZER: I want you to respond to what the president said today in Chattanooga about a grand bargain. Listen to this.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: So, again, here's the bottom line. I'm willing to work with Republicans on reforming our corporate tax code as long as we use the money from transitioning to a simpler tax system for a significant investment in creating middle class jobs.

(APPLAUSE)

OBAMA: That's the deal.

(END VIDEO CLIP)

BLITZER: Are you with him on that deal?

PAUL: Well, you know, I've got a counter-proposal for him. I've -- I've said that we should reduce the taxes on corporations doing business overseas. And I'm willing to put all that money into infrastructure.

If we would tax corporations at five percent on their foreign profit, let them bring it home and put that tax revenue into the transportation fund, I have an amendment that would do that. If he'll come to the Hill today, he could help me pass my amendment, and it would double the amount of money left over for infrastructure. And I think that would be a great thing for the nation.

I don't see him coming to us on these issues. Lowering the corporate income tax is good, but if he wants to expand government, government is already too big. We have a trillion-dollar deficit.

I'm willing to lower the corporate income tax. It's absolutely the right thing to do. But we shouldn't have to trade something really bad, like expanding government. I don't know what he means by helping the middle class. I want to help the middle class. Lowering the corporate income tax would help the middle class. So if that's what he's for, I am. But I have no idea what his speech making means (INAUDIBLE) --

BLITZER: I -- I think what he wants to do is spend more money in investments to help the middle class. That's the -- the main point of his speeches over the past few days.

But let me -- get your thoughts -- you and a few other Republican senators came out with a new initiatives -- initiative today to help poor minority students, uh, get into charter schools, if you will, have a little -- uh, move away from some of the public schools. What exactly are you seeking?

PAUL: Well, I'm excited about school choice. I think every kid in Washington, D.C. should have the same choice that the president has for his children.

The president has a lot of money so he can send his kids to a very elite private school in D.C. I think a poor kid in the poorest neighborhood in D.C. should have the same choice. And so I would let them have vouchers.

And I would hope that the president would come out and say that it can only be fair that every kid in the community should get the same choice that his kids get. So I think vouchers that let kids choose where they go to school would be great. I'm for attaching Title 1 funds, the federal money, and saying let the kid take that to the school of their choice.

I'm for charter schools which are public school are able to have more innovation. So I'm for all of the above on school choice.

BLITZER: Senator Paul, thanks so much for coming in.

PAUL: Thanks, Wolf.

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