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This is a rush transcript from "On the Record," January 9, 2012. This copy may not be in its final form and may be updated.
GRETA VAN SUSTEREN, FOX NEWS HOST: Congressman Ron Paul says, I'm in this, I'm a contender. And yes he is, because he is now running a solid second here in several New Hampshire polls. Can he defy the odds, though, and catch up to front-runner Government Mitt Romney? Griff Jenkins spoke with Congressman Paul on the campaign trail.
GRIFF JENKINS, FOX NEWS CORRESPONDENT: Congressman, you have quite a head of steam here coming in. You're rising in the polls and it looks like Mitt Romney is slipping. What is happening here?
RON PAUL, GOP PRESIDENTIAL CANDIDATE: It looks like our message is getting out. And it's a great state. They believe in a limited government and the issues I've been talking about. So we're very optimistic about the way things are going. And we have a ways to go to really get it, but I tell you what, if we get close to him it will be a real big news story.
JENKINS: Why are you getting closer? You've said on the campaign stump that you're doing the same message you've been doing, but it's starting to click. Why?
PAUL: I think the country and the world has changed. Certainly the financial situation has changed, worldwide domestically as well as international. And of course, that was my big issue for many, many years and motivated me to get involved in politics in the 70's, warning about a financial bubble and warning about the financial system and the monetary system. And it's come about. So we talked about the housing bubble before it burst. So now we have credibility on economics.
But we also credibility on the foreign policy, too, because the foreign policy we fought for the past 10 years contributed $4 trillion dollars worth of debt. That means money spent overseas on these wars was taken away from the people. And that's why we're having trouble paying the bills for medical care in this country.
And I think it's coming together. And of course the young people are enthusiast it can about these viewpoints.
JENKINS: You mentioned foreign policy. Some of your fellow candidates, Rick Santorum says you're dangerous. What would president Paul draw people to your fiscal and constitutional message, but questions your foreign policy and what do you think of Santorum is saying?
PAUL: I sort of chuckle because I can't say how a strict constitutionalist be dangerous and somebody who puts on high priority national defense, because there are so few things we're supposed to do at the national level and one is national defense. So my viewpoint is that what we do overseas undermines our national defense.
And we have too many conservatives who say if we spend more money overseas you're going to get more defense, but I don't believe that. You get more militarism. You want more defense by having a different foreign policy.
And they accept that reasoning domestically, you know, if the department of education isn't doing well, conservatives don't say, well, that's doubled as well. Sometimes they do double the size of the department of education, but that's not a conservative viewpoint, you know, just pumping more in, money, domestically.
And that's the way I'm consistent in I look at that nationally and just sending over more foreign aid and invade another country that hasn't done harm to us, that doesn't give us more defense. And people are catching on to this.
JENKINS: I know, you've been asked this, but if you become president, what is the first thing you would do policy-wise? And people know, you say, you know, once your president, what would be the first thing you would do?
PAUL: One area where the president would have a commander-in-chief so you don't have to go looking for another war and you don't have to intimidate people. You don't have to say we're going to put a lot of sanctions on you and disrupt trade around the world.
But you can say, well, our national security doesn't depend on a whole naval force in the Persian Gulf. We don't want China in the Gulf of Mexico. So we might say, reasonably speaking, is our country less secure by backing off a couple of miles? And I think that opens up the door for discussion.
And I think that's what the world needs instead of you do it our way. If you do it our way we'll give you a lot of money, and if you don't do it our way we'll send a drone missile over there and start picking at you.
So I think it's a completely different foreign policy. It's a very pro-America, strong national defense policy, but it also is living within reason that it's a policy we can afford right now. We can't afford this, and we have to get our budget under control.
JENKINS: A new poll today says that 56 percent says more than half of the voters here in New Hampshire are undecided, probably a lot of them in that. And what's your pitch with them with hours to go before the voters hit the polls?
PAUL: The same they think I've been pitching for 30 years -- more freedom, less government, lower taxes, strong national defense, looking into Federal Reserve, and a concentration and emphasis on personal liberty, because this is one state that understands what personal liberty is all about.
JENKINS: And depending how you do here, you've said you'll go straight to South Carolina. What's the path forward? You said maybe not going to Florida. What's the path forward?
PAUL: We'll -- I will stop in South Carolina on Wednesday as we leave here, and we don't have the full campaign in Florida, but we won't be absent, but we'll see how we do tomorrow, as well as in South Carolina, and then look at the budget.
JENKINS: Last question, do you-- you've been hesitant to answer the third party question, so let me try a creative way. What's your opinion on what Ross Perot did and how he ran?
PAUL: Well, he was very rich. I'm not very rich.
PAUL: I've contributed some services here and it distracted me a little bit from a medical practice. And also, you know, I gave up a pension, my federal pension fund, so I don't have that kind of money. So that's a different story completely. And it is a system that is very biased against third party movements. And right now I'm in this. I'm a contender.
JENKINS: We've tried to follow you around. You're like a rock star here.
PAUL: Yes. So that thought doesn't cross my mind. I'm not thinking if those terms.
JENKINS: Congressman, we appreciate your time and we forward to following you on the campaign trail.
PAUL: Thank you very much.