This is a rush transcript from "On the Record," April 6, 2010. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: We are live at the fabulous Caesars Palace in Las Vegas, Nevada.

The most powerful U.S. senator, Senate Majority Leader Harry Reid, represents this state of Nevada, but he is in a political dogfight. You just heard from Sue Lowden, one of the Republicans trying to unseat Senator Reid. Now, Lowden's Republican primary opponent Danny Tarkanian goes "On the Record."

(BEGIN VIDEOTAPE)

VAN SUSTEREN: How are you going to get past this June 8th primary?

DANNY TARKANIAN, NEVADA SENATE CANDIDATE: You have to compare and contrast my positions to State Senator Lowden's positions. And we've been doing that throughout the campaign. There's different things that she believes in politically than I believe in, and we'll let the voters decide which ones they feel would best represent the interests of the state.

VAN SUSTEREN: But if someone says I'm a Republican and I can't decide between the two of you, give me an issue, where are you so different?

TARKANIAN: Four issues. Former State Senator Lowden has defended the first bailouts. I think the bailouts were wrong, been against them completely and would never have voted for them. Former State Senator Lowden feels that Harry Reid has fail the state because he doesn't bring enough federal sending back to the state.

VAN SUSTEREN: Some of that stimulus money, you mean?

TARKANIAN: Stimulus money, or pork money, whatever revenue money that comes in. Nevada has always been at the bottom of the list. You can make up for that by doing one of two things -- spend more money bringing it back to Nevada, or cutting the spending across the other states and lower the debt.

That along with her tax record as state senator and her support for Harry Reid in six different elections, donating and voting for him, makes a big difference between herself and myself.

VAN SUSTEREN: What would you do about -- let me go back to the spending issue. Would you bring the money back from Washington here or cut spending?

TARKANIAN: We need to cut spending. He need to eliminate all federal pork projects.

I've come out very strongly saying if the state wants to have a project done, the state should pay for that project. The federal government should have no involvement in that.

If the people in Florida want to build a turtle tunnel so turtles don't get hit by cars crossing the road, let the people of Florida do it. People in Nevada shouldn't have to pay for those things. Cut the spending, cut the debt of the government, that's our big biggest risk right now is skyrocketing debt.

VAN SUSTEREN: Now, Governor Sarah Palin breezed through here about 10 days ago with the Tea Party Express. To what extent is the Tea Party movement in Nevada created a voter issue come June 8th and through November?

TARKANIAN: The Tea Party movement is a collective group of people frustrated with what is happening in the state. They are frustrated with high government spending, the government intervention into the financial health care and auto industries.

There's a movement to get our country back to the few limited purposes of the federal government should be. These are values I feel strongly about. I relate very well with those voters. We anticipate getting many of them on Election Day.

VAN SUSTEREN: Do you feel part of the Tea Party movement?

TARKANIAN: You are making it seem like it is a party.

VAN SUSTEREN: Isn't there actually a party forming here in Nevada, or not?

TARKANIAN: Not by the Tea Party people. By some guy that says he's a Tea Party person created his own party.

VAN SUSTEREN: You have a Tea Party issue.

TARKANIAN: The Tea Party representatives have stated they don't know who and the guy has no involvement in the party.

But with respect to the collective movement of people under the Tea Party umbrella, they have political philosophies that they want the government to get back, which is limited government, personal responsibility, self-determination, and individual liberties.

And these are things that I feel strongly about. And we talk about them everywhere as we go around the state.

VAN SUSTEREN: There are some issues that are national issues, some are more local having to do with the state of Nevada. I imagine immigration is a national issue and also has a profound effect in this state as well. What is your solution or idea about immigration?

TARKANIAN: There is a simple solution to a very complex problem if you can get people in office with the convictions to do it. First and foremost we have to secure our borders not only for immigration issues but with the national defense issues.

VAN SUSTEREN: How are you going to secure the borders?

TARKANIAN: Build a fence and use new technology that can help identify people when they cross the border. That's a small part if you want to reverse the immigration trend.

If you want to reverse the immigration trend, you've got enforce the laws that are out there by taking incentives away for people to come into the country illegally. If people come into the country illegally they are not entitled to taxpayer education, health care, jobs, welfare. They shouldn't be provided this.

We should as a government and a society be able to ask people are you here legally before they get these benefits. Once you are identified as not here legally, you are not entitled to them, and these people can no longer get them, many will go back on their own and reverse the trend of illegal immigration.

VAN SUSTEREN: What do you do about the employer who hires somebody illegal?

TARKANIAN: You have to penalize the employer more than he's saving by hiring somebody illegally by paying them lower wages. Once you make the penalty higher, then the benefits are saved and they will stop doing so, including taking away their license if they continue to abuse this.

VAN SUSTEREN: What is your explanation for why Nevada is higher than other states in unemployment? What happened here?

TARKANIAN: Nevada has two major economies -- gaming and construction. Construction is determined on gaming. Once gaming stopped, and that means people with discretionary income didn't have that income anymore and they weren't coming here to gamble, you had a reduction in the gaming business, and with that people who had jobs lost their jobs and therefore the construction ended.

Right now we have a stalemate in our gaming industry. It's been going down and now leveling off. Construction won't start back up again until new construction the gaming industry happens, and that won't be for decades. Our construction industry is decimated.

VAN SUSTEREN: Even if you are a Republican, why would you want to get rid of your United States senator when he's the most powerful one, Senate majority leader? Everyone has to admit he's the most powerful U.S. senator. And even though he might be of another party of a particular voter, why would you dare get rid of somebody like that?

TARKANIAN: Because what he's doing with that power is detrimental to not only the people in Nevada but the whole country. When you have the most powerful person in the Senate taking government ownership of the financial institutions, health care, insurance, auto industries, running our debt up to $14 trillion plus and going to double in five years, these are things that are going to hurt people in Nevada and the whole country.

Do we want to go down this continuously dangerous road where we're close to being past the point of no return? The people of Nevada understand that and believe Reid is using his power to the detriment of the state and country.

(END VIDEOTAPE)

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