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CNN "The Situation Room" - Transcript - Government Shutdowns and Budgets

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SEN. RAND PAUL (R), KENTUCKY: Describe sort of pastorally where we are.

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BLITZER: We're following the breaking news up on Capitol Hill. The Senate has just passed the compromised budget plan approved earlier by the House of Representatives. The vote in the Senate, 64- 36.

Republican Senator Rand Paul of Kentucky was among those voting against it.

Senator, thanks very much for joining us.

PAUL: Good to be with you, Wolf.

BLITZER: Let's talk a little bit about your vote. Would you have rather seen another government shutdown, the last one 16 days and cost the U.S. economy, what, about $24 billion?

PAUL: Yes, no, I wasn't in favor of a shutdown, and I think that's sort of a false choice. You're setting it up as if that was only choice. Really, what we've been doing in the past is passing a continuing spending resolution which doesn't mean shutdowns, but current law is actually better than what the deal is. The current law included some budget caps from 2011, and now we've abandoned those caps, so I think this is really a step backwards for the country, and really we've allowed us to say, you know what, we don't care so much about the debt. And I think that's a big mistake.

BLITZER: But isn't it good that for at least two years now no one will have to wore about another government shutdowns, all the uncertainty, the pain and the cost that those shutdowns incur?

PAUL: A shutdown is not good but I'm worried about the future of the country. I'm worried about a $17 trillion debt and I'm worried about the fact that we're borrowing a million dollars every minute. So, really, there's concern about shutdown, but there's also concern about the long-term fiscal stability of the country, and I think we've got so much debt that it was a mistake for us to give up on the budget caps.

BLITZER: Will you vote to reinstate those benefits for military veterans that would reduce in this plan approved by the Senate today, earlier by the house and that's about to be signed into law by the president?

PAUL: Given a chance, yes. But, see, that's the problem with the Senate right now. The Democrats don't allow any amendments, so we end up passing bad legislation which they make mistakes that they say are mistakes. But this could easily be fix if we have a more open process.

So, right now, there's not much collegiality going on. It is a poisonous atmosphere where the majority is just shoving things down the throat of the minority, and because of it we can't fix legislation like this. So, disabled veterans will lose part of their pension. People who have sacrificed their limbs will lose part of their pension because Democrats are in a hurry to get their way, and they want their way or the highway. They don't want any amendments.

BLITZER: But there was collegiality and cooperation and compromise in the House of Representatives earlier and now in the Senate. Those were pretty lopsided votes.

PAUL: Yes, but compromise in the wrong direction, Wolf. What happened is Republicans said we want more money to spend on the military. Democrats said we want more money to spend on social welfare, so they compromised in the wrong direction. They compromised to add $60 billion in new spending, all of it borrowed, and even borrowing from disabled veterans.

The money that they are not going to pay to disabled veterans, they are not saving it or going towards the debt. They are immediately spending it on more weapons systems. So, no, it's a huge step backwards, and can you say that's compromise, but its compromise in the wrong direction. It's compromise towards accumulating more debt. It's a big mistake and a big step backwards for the country.

BLITZER: So John Boehner, the speaker and Paul Ryan, the chairman of the house budget committee, you believe they were totally wrong in supporting this deal.

PAUL: Absolutely. When we had the budget caps that we passed in 2011 which people called the sequester, S&P said that they were inadequate and they downgraded our debt. So, we've taken something that even in 2011 people thought wasn't enough, and we abandoned it.

So really, I think the number one threat to our national security and to our country is our debt, and by going through with this budget motion, everybody wants to be all giddy and joyful. It's a compromise. It's pragmatic. Yes, but it's a compromise going in the wrong direction. It's a compromise towards not really being serious about our debt.

BLITZER: The next big fight could be raising the nation's debt ceiling once again. The treasury department says that has to take place in February, maybe March at the latest.

Here's the question. What will it take for you, senator, to support an increase in the nation's debt ceiling once again?

PAUL: You know, I supported a proposition called cut, cap and balance two years ago which is, yes, I'll add more debt if you'll agree to balance your budget from here on out. If you're not going to reform the price, if there's not going to be any conditions and see the president has already said, hey, I'm not going to negotiate with a gun to my head, he won't negotiate with or without any leverage, or with or without any deadlines, my problem is I can't in good conscience vote to raise the debt ceiling without budgetary restraint.

BLITZER: But you realize, of course, Senator, and you're obviously a smart guy, the Republicans in the Senate is the minority, the president is in the White House. In order to reach these kinds of grand deals, if you will, you need to cooperate. You need to compromise. You can't just have 100 percent your way.

PAUL: Well, we are getting 100 percent the president's way. He got Obamacare with no Republican votes. He's getting the budget, you know, the spending. He's getting the debt ceiling. He's getting all of those basically his way or the highway so really there's not any compromise coming from the administration when the president says I will not compromise. I will not negotiate. It sounds to me not like our side is the problem. It sounds like their side is unwilling to negotiate.

BLITZER: Let's talk about the NSA surveillance programs. I don't know if you've had a chance to go through this report that was released today by -- these recommendations for curbing and reforming some of the NSA surveillance programs. If you have -- you want to give us your immediate reactions to these recommendations.

PAUL: You know, my reaction is that the judge the other day said that it was unconstitutional is exactly right. I think even the president's own team now is coming up with recommendations that acknowledge that the president has allowed this to get away from himself. He's allowed the NSA program to be intrusive, go against the bill of rights, go against the fourth amendment. And even his own team is now recommending that he needs to rein this in.

I don't think they go far enough in the sense that I think the fourth amendment should protect your personal information and that you do have a right to privacy, whether the papers are in your house or whether they are kept at your bank. I think you do have a right to privacy and we'll continue to fight this.

BLITZER: Well, when you say fight this, are you ready to file, as there have been reports, and you're familiar with them, a class action lawsuit against the NSA to stop it?

PAUL: We have tens of thousands of people who have signed up for it. We're still exploring the legal aspect of whether we can file a class action suit. When you hear of class action suits, you hear of them mostly on liability. This would be a class action suit on a constitutional question, and it might be the first of its kind if we can file it.

The problem is the court sometimes say you have no standing, and the NSA will say, hey, prove we were spying on you, but we won't give you any information whether we were or weren't. So we're exploring it from all different ways.

I'm also exploring legislation that would give people an easier time standing in court and then if the phone company gets an order from a secret court, the FISA court, that they could appeal this into a public court or the Supreme Court.

There's a lot of venues that we're trying to reform. Bottom line I don't think the NSA should be spying on Americans. I think they should be spying on terrorists.

BLITZER: Do you believe Edward Snowden, and arguably we're having this discussion right now because of his leaks, do you believe he broke the law or was a whistleblower?

PAUL: You know, that's a real question. If he were here I think he would probably say he technically broke the law, but in favor of a higher law which is the constitution. Now we have a federal judge that's saying the information that he gave us was about an unconstitutional program.

I think there have to be rules about leaks. I don't think you can give away national security secrets. But at the same time, I'm very offend that the intelligence director lied to Congress which is perjury and punishable by time in jail, and the president has glibly gone on his way, has not asked for his resignation, has not said that he will try him in court for lying to Congress. I find that really -- that clapper is lying to Congress is probably more injurious to our intelligent capabilities than anything Snowden did because Clapper has damaged the credibility of the entire intelligence apparatus and I'm not sure what to believe anymore when they come to Congress.

BLITZER: Well, let me just press you on that, Senator. You believe Clapper is more of a potential criminal when it comes to national security secrets than Snowden who by all accounts took about 1.7 million classified documents?

PAUL: I think the law is the law and they both broke the law and that one shouldn't get off scot-free. And even Snowden, I think really broke the law and we can't have people revealing secrets. But at the same time, there is some question whether or not you can be a whistleblower in our society and whether you can release information that you think that the government is breaking the law, and that is the argument here, and now it's been upheld by a federal court saying that the government is breaking the law. And I do think what you're government is doing is unconstitutional. And I really think that in order to restore confidence in our intelligence community, I think James Clapper should resign.

BLITZER: So just to be precise. If it were up to you, you'd have the justice department file charges, criminal charges, against James Clapper?

PAUL: Otherwise you're just encouraging people to lie to us, and then we have no confidence now -- if the intelligence community says we're not spying on Americans, well, and they are, and then they say we're not collecting any data, it's hard to have confidence in them. Now, they are saying, we capture terrorists with this data. Are we to believe them or not to believe them?

If they are going to come to us and lie it really damages the credibility, and it's damaged our credibility worldwide, but really with the American people because we don't know what to believe. So, I don't know how you can have someone in charge over intelligence who has known to lie in a public forum to congress, to lie without repercussions. I really blame the president for not taking a better handle on things.

BLITZER: One final question before I let you go, Senator.

On these U.S. drone strikes, there's now a report that a drone strike in Yemen instead of killing al-Qaeda terrorists that was the suspected targets wound up killing, this is according to a government official in Yemen, killing a wedding convoy, including 14 civilians who had nothing to do with al-Qaeda. What's your position on these U.S. drone strikes?

PAUL: You know, I think you do have to worry about the unintended consequences. You remember the very articulate little girl, Malala or young woman now from Pakistan who was shot by the Taliban, when she had a chance to talk to the president, her first words you're not helping, you're hurting America's cause because when innocent people die in Pakistan, there is more hatred for America.

So, I think drones are useful for killing out enemy in battle. But a lot of the drone strikes are going towards people who are not currently involved in battle, and they are intermixed with their families and occasionally we're making mistakes. So, there's an upside and a downside. And I think right now the downside is creating such enmity in parts of Pakistan and other places around the world that they may be more deleterious than they are helpful.

BLITZER: Senator Paul, thanks very much for joining us.

PAUL: Thanks, Wolf.

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