Sen. Paul: Tackle Medicare Separately

This is a rush transcript from "Your World," May 11, 2011. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST OF "YOUR WORLD": The Kentucky Republican senator joins me right now.


SEN. RAND PAUL, R- KY.: Hi, Neil.

CAVUTO: ... the issue I was getting into with your colleague from Pennsylvania was that, by not including Medicare in this initial plan, for whatever reason, it was sending a disturbing signal.

Are you disturbed?

PAUL: Well, I think, unless you look at the entire budget, you’re not really serious about balancing it. We’ve been looking at nonmilitary discretionary spending up here, and that’s about 12 percent of the budget.  You can eliminate all of that, and you won’t balance the budget.

So, if you’re serious about balancing the budget, you do have to look at entitlements. You have to look at non-military, and you have to look at military. You have to look at the entire budget. And even then, it’s a difficult process.

I mean, we have a budget plan; my office does, to balance it in five years. But it’s not easy. You have to eliminate some government programs.

CAVUTO: Well, does yours include Medicare?

PAUL: Our budget actually did not include Medicare. We’re going to tackle that separately. But we did it by eliminating departments, Department of Education, Housing and Urban Development, Commerce, having significant chunks of the Agricultural Department...

CAVUTO: And how much money would that raise or cut doing so?

PAUL: Well, what we do is, over five years; we get to a $19 billion surplus. In the first year, we cut the deficit by about half. And then we go down dramatically from there.

But if you do it dramatically, then you can allow government to go back to growing at about the cost of living, or at the rate of growth. The interesting thing -- and a lot of people don’t realize this -- if you take Bill Clinton’s last budget, and you let it grow by population and cost of living, it still balances.

The reason our budget doesn’t balance now is because Republicans and Democrats have been on a drunken spending spree up here. And it’s -- both parties have done it to the country. Now both parties need to clean it up.  But the only way to do it by is cutting spending.

CAVUTO: Yes, but it’s your party, Senator, it’s your party that, whatever your specific plan cuts, you have left out Medicare, maybe down the road something you say you will address.

PAUL: No, well, we have introduced separately already a fix for Social Security, which allows Social Security age to rise gradually.

CAVUTO: When? When?

PAUL: We are in – we’ve already introduced that. Senator Graham, Lee and I introduced that.

CAVUTO: But that’s not part of this. Yes, but, Senator, that’s not part of this.

PAUL: Well, it’s a separate bill, but it’s introduced. And it all needs to be done now. I’m not saying we wait.

We just chose to tackle them in three separate issues. We’re in the process of formulating a bill on Medicare which will allow the age to gradually rise, accounts for the baby boomers, and will means test-folks where, if you’re Warren Buffett, you’re going to have to pay the full price for your Medicare. And that’s the only way you fix Medicare. But, absolutely, you have to...


CAVUTO: Then -- sir, then...

(CROSSTALK) CAVUTO: ... me of my concerns that these Medicare town hall meetings that have popped up, where Paul Ryan’s plan to -- just to look at ways to make it more effective have -- has run into a buzz saw of criticism, a lot of Republicans have been feeling the heat -- you feel you have a good chance, that is Republicans, to retake the Senate.

You don’t think now is the time to fiddle with Medicare. It was a point I raised with Senator...

PAUL: No, I do think -- I do think it is.

CAVUTO: Wait a minute. It’s a point I raised with Senator Toomey.  Are you saying that that is not the view?

PAUL: I’m saying it absolutely is the time to tackle Social Security and Medicare now. And we are in the process of doing it.

And everywhere I go, to every town hall I go to, I say, look, it’s broken. There are too many people retired. There’s too much money being spent and not enough young people. It is a fact that it’s broken. And the only way you fix it is by allowing the age of eligibility to go up for both, for Social Security and Medicare.

CAVUTO: I know. I know that. But it isn’t part of these budget plans now, sir. That’s what I mean. I mean, you have the goal, and the hope springs eternal. But my worry and I think some Tea Party worries those who supported you is that you got nervous.

PAUL: No, not us at all, because, see, our budget actually balances in five years.

And we had that done before we’ve gotten the numbers back. We’re trying to get all the numbers crunched. Like, when we did our Social Security reform bill, which fixes Social Security by allowing the age to rise, we got it scored by Social Security. That took us a month-and-a- half.

So, sometimes, these issues are separate not because we’re bailing and not willing to fix the problem. You won’t meet anybody up here more willing to fix the problem and take on the entitlements. I’m willing to say exactly what it takes to fix the entitlements.

CAVUTO: But you’re treating it separately. For now, I’m clear...

PAUL: Just separate bills.

CAVUTO: ... you’re treating it separately. All right. We can argue about this for a while, but I don’t want to.


CAVUTO: I do want to address this issue you raised yesterday about the White House maybe keeping an enemies list, and a lot of people, a lot of organizations on that enemies list. What did you mean?

PAUL: Well, some of it was a rhetorical flourish, I will have to admit, but some of it’s really halfway serious.

And that is that it does appear that politics is playing a role in who they’re going after. You know, if Boeing had decided to locate in Chicago, and they were going to use union labor, my guess is there wouldn’t be a big dispute. But they’ve gone to a Republican state that’s right-to-work.

They’ve already built their facility. They have spent a billion dollars, and the government’s going to come in at the last minute and say, oh, no, you don’t. You’re not using union labor and you’re a non-union state. We’re going to shut you down.

It’s absurd, and particularly after they’ve already built the plant.  They’re ready to start building planes in the next week. I do see it as a form of political enemies list.

CAVUTO: All right.

PAUL: It comes on the heel of last week, where President Obama says he wants to know who you have contributed to. So, if you do work for government and you have given to Republicans, my assumption must be that you may go on the president’s enemies list.

CAVUTO: All right, Senator.

PAUL: At the very least, we ought to ask him.

CAVUTO: Who’s on that list?

All right, Senator, thank you very much.

PAUL: Yes. Thank you.

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