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Reports of Tea Party's demise greatly exaggerated?

This is a rush transcript from "The Five," June 18, 2013. This copy may not be in its final form and may be updated.

DANA PERINO, CO-HOST: The Tea Party movement roaring back to life with its largest gathering in Washington, D.C. since 2010. Thousands of supporters gathered outside the Capitol to stand up from targeting from the IRS and push back on big government.

Several Republican lawmakers were there, including Ted Cruz, Rand Paul, and Steve King.

(BEGIN VIDEO CLIPS)

SEN. TED CRUZ, R-TEXAS: What's happening with the IRS is an absolute outrage.

SEN. RAND PAUL, R-KY.: And we're sick and tired of government bullies, and we need to send them home.

REP. STEVE KING, R-IOWA: If this broad federal government can track every phone call, if they can track every Internet activity you have, if they can track your credit card, if they can track your cell phone, and if the IRS then can have a software package to focus their enforcement on the enemies of the president of the United States, this big brother has gotten creepier than George Orwell thought it would ever get.

(END VIDEO CLIPS)

PERINO: All right. We're going to kick this around.

Eric, I wanted to ask you how after maybe a little time of being apart, the mainstream Republicans or establishment and the Tea Party actually have a reason to come together with fresh ideas or fresh ammunition because of the IRS scandal, and then the possibility of the IRS, now in law, IRS taking over and implementing Obamacare.

(CROSSTALK)

ERIC BOLLING, CO-HOST: You made the face! You are so busted.

KIMBERLY GUILFOYLE, CO-HOST: You made weird faces at me, and I'm glad you said it.

GREG GUTFELD, CO-HOST: I didn't know anybody was paying attention.

BOLLING: I am looking at her --

PERINO: Was it at me?

BOLLING: No, he was making a face at Kimberly.

GUILFOYLE: And then I made one back. It was really good.

BOLLING: Anyhow --

PERINO: Welcome to the most mature hour on television on cable news.

OK. What I was saying is that Republicans under the big tent have a renewed vigor to, you know, again, I don't know -- I am looking at Greg, wondering if he is making other comments.

BOB BECKEL, CO-HOST: Don't worry about him.

PERINO: But don't worry about Greg. What do you think about it?

BOLLING: So, I had this long conversation. Someone stopped me in the street, all the scandals, are they going to have effect on Obama? I said, no, they're not going to have effect on Obama but they will have effect on the 2014 midterm elections. These scandals, Benghazi, DOJ, IRS, NSA, you know, independently wouldn't have had much of effect, but aggregately, you know people are going to remind, all the commercials, all the political commercials in 2014, hey, do you want more of this? Do you want more of these Democrats? The transparency Obama promised isn't going to happen.

I think what it did was it's going to guarantee the GOP the House again, and it's going to actually get some seats for the GOP in the Senate. And really, that's kind of more important than winning the White House in `16.

PERINO: Oh, look at our resident skeptic is there with his --

BECKEL: I -- being a resident skeptic, bringing the GOP together looking at those speakers, you've got the fringe of the fringe speaking, number one.

PERINO: That's who got the people to come out though.

BECKEL: Well, sure. I mean, they come out for those people because they're far to the right. That picture, by the way, I have seen a lot of demonstrations in Washington, whenever you want to make a demonstration look bigger, you always use a smaller lens in your camera.

The Tea Party is not a very potent force this time around, I don't think. They had Obamacare last time. I don't think frankly they're that big a deal. And I think the Republican mainstream is running away from them.

PERINO: But even with this new round of scandals, do you think that they're pulling together?

GUTFELD: Bob is so wrong. Remember when President Obama said we are the ones we were waiting for?

PERINO: Right.

GUTFELD: This is actually it. He inadvertently created a new modern movement, and it's like what Eric said.

OK, you start with class warfare. First, you start with Obamacare, disaster, class warfare, Benghazi, DOJ, IRS, NSA, targeting innocents since 2008. The Tea Party is the tip of this arrow, and America has to get behind it with that arrow, stab the beast of big government, and watch it ride and die.

The IRS is the beating heart of that beast and you've got to do it.

You look at those people, Bob, you think they're funny looking and whatnot, but the most explosive thing there is potato salad, the only bomb you're going to find there is lip balm.

GUILFOYLE: Isn't that true?

GUTFELD: Yes, people blame -- you know, when the marathon bombing took place, what did Michael Moore suggests? That it was people like that that do this stuff. These are good people. This is the calmest, sweetest revolution probably ever, and they deserve the respect for being right for the past five years.

PERINO: You know with a metaphor like that of stabbing the beast, no wonder that Republicans are considered the monsters that you painted not to be. I want Kimberly in here -- after we listen to somebody that you and I have a crush on, somebody very wise.

BOLLING: You guys can't talk about me.

PERINO: That we actually have a crush on.

(BEGIN VIDEO CLIP)

CHARLES KRAUTHAMMER, CONSERVATIVE COMMENTATOR: We see what's happening with the IRS, with the DOJ, all these huge institutions, which are obviously failing the American people, being abusive, in some cases corrupt. This is time for an ideological offensive on the part of the conservatives, the vindication of the idea of smaller government. So, stop the navel gazing and make the case. If conservatives do, they will win.

(END VIDEO CLIP)

PERINO: Kimberly, I wanted to ask you, are Republicans too mired in self analysis, and putting themselves on the couch, and wondering what's going to happen to them, what do they mean? They should just get together and do it.

GUILFOYLE: Yes, you have to at certain point make the jump past ideology and jump into action. That's why the Tea Party resonated with so many people.

And I think more than anything, Bob, sorry to say, they're back, and you know why they are significant? Your side is afraid of them, why would they be targeting them with the IRS, and auditing them, making sure that they don't get their tax-exempt status, because they are fearful, because they did have an impact on midterm elections and they will again, because people are tired of the government abuse. All the problems of the scandals that we have seen with this administration, the Tea Party is addressing a lot of that in their platform.

So, it is a concern for your side.

BECKEL: Just for the record, I have nothing against these people. I think they have every right to protest. I am not making fun of what they look like. Look at me.

But the point is --

(CROSSTALK)

BECKEL: The point is, are they going to have impact in terms of the voting booth. I think some of these scandals collectively will bring out more people to the midterm elections than normally are there. That has nothing to do with Tea Party, but people like the Tea Party, who don't like big government.

GUILFOYLE: It's the vehicle. They'll jump on the bus.

BECKEL: Whatever you want to call it. But there will be an increase in voter turnout and it will not be in the Democrats' favor. But I just can't consider this a resurgent Tea Party movement. You can consider this a resurgent small government movement.

GUILFOYLE: That's the same thing.

BOLLING: Isn't that exactly what the Tea Party is there for? I mean, you always say, and we all agree that presidents, you know, during elections, presidential elections, you know, the right will move to the right during the primaries, move to center for the general. Well, midterm elections are like the primary's primary.

All these scandals with what you just mentioned, they turn out more during the midterm elections, this is very, very good for the GOP. Scandals happening now couldn't have happened at a better time.

BECKEL: But let's remember, there will be 20 million fewer voters at the polls in midterm election that will be presidential election. If you have a million people or 2 million who haven't been there before in selective states and selective districts, it will make a difference. I said from the beginning, I thought the Senate would be for the scandals. I thought the Senate was likely to be picked up by the Republicans.

GUILFOYLE: Yes. But, Bob, the problem for the Democrats is this is fortuitous timing, right? The Tea Party has a good message, platform that resonates, and there are a lot of facts -- specific facts and circumstances right now that align with what they're trying to say, government abuse, government is too big, go for smaller government, less taxation, more privatization, less expanding of the government. Forget about Obamacare, giving those government money when they don't work.

BECKEL: Dana's point about this is, this navel picking for the Republicans, you have been in this position, this has been your message for 10, 20 years. I mean, I don't see, unless you can get into a coherent kind of message, and you think you're doing it around negatives, things like scandals and the rest of it, does that emphasize small government?

Certainly it does.

But I just don't see anybody carrying that thing forward.

GUILFOYLE: What are you laughing?

BECKEL: What?

GUTFELD: Navel picking.

BOLLING: Navel picking. Navel gazing.

GUTFELD: Some people (INAUDIBLE) their navel.

(LAUGHTER)

BECKEL: Don't you -- is that why you were laughing at me, Dana?

GUTFELD: You have a navel the size of a hub cap.

GUILFOYLE: Oh!

(CROSSTALK)

GUILFOYLE: No, Bob's navel is the size of the hubcap.

GUTFELD: It actually is a positive message that we're talking about here. We're talking -- I think limited government is a positive message, but what Bob is saying is you're up against something that's about free stuff, the Occupy Wall Street philosophy was make everything free, which is something that's hard to argue against, unless you have intelligence, which is what the Republican Party must find.

Look, look at how the media is going to frame this, the Tea Party is the most dangerous group. Just below the Taliban, Nambla (ph) and Maroon 5.

Why is that? Because they remind everybody of their parents, parents tick you off because they're right.

So, the media is going to ignore them. They're going to mock them. If there's one poorly spelled sign at that rally, "The Daily Show" will spend 20 minutes mocking that sign to make themselves feel smarter while ignoring the fundamental issue and fundamental message, which is you're screwed. Big government is screwing you and it's time to screw big government.

PERINO: Can I give a specific to that? Based on Kimberly's reaction. You're going to be mad.

GUILFOYLE: I'm mad of it.

PERINO: The Internal Revenue Service, the IRS is about to pay $70 million in employee bonuses, despite Obama administration said during sequestration, let's cut nondiscretionary spending. What they're saying, I have a quote from the IRS, the reason that they have to do this is because the IRS is under a legal obligation to comply with its collective bargaining agreement --

GUILFOYLE: Oh, boy.

PERINO: -- union -- which specifies the terms by which awards are paid to bargaining unit employees.

Bad timing with bonuses?

GUILFOYLE: There's the problem with this collective bargaining and unions, they're inherently flawed when you have a situation like this when you have sequestration, we're supposed to be tightening the belt, and not going it -- by the way, and rewarding bad behavior that's been going on at the IRS, we're going to pay all out bonuses.

It's the most flawed business model ever because it operates as disincentive. Why do I care if I do my job well, because I'm going to go ahead and get a better job if I am in public scandal, I'm going to get a bonus, paid up because I am part of union, regardless of whether I target, you know, hardworking Americans and deny them tax exempt status.

BECKEL: If you don't mind me saying so, there's a lot of hardworking Americans who are public government employees. You're trying to punish the IRS for a couple of bad apples that are there, one. Two, collective bargaining is an agreement. It was signed, part of the way --

GUILFOYLE: It's legal.

BECKEL: And it's legal. Why is it such a big deal?

PERINO: Don't you think it is persuasive, Bob, maybe the union from a pr standpoint should have said in time of sequestration, when the entire agency is under investigation, could we delay these three months? But they don't do that.

GUILFOYLE: They don't care.

BOLLING: Can I make one more observation? The NTE, National Treasury Employees Union, which is a union that's claiming they need to be paid because of collective bargaining agreement that Bob points out, was also the group, I can't remember her last name, Colleen something, who visited the White House on March 31st, 2010, the next day, April 1st and April 2nd were days they began to target conservatives.

So, was there discussion, hey, whomever at the White House?

PERINO: It wasn't the Easter egg roll.

BOLLING: Whomever, if that comes out --

BECKEL: That is a conspiracy you're going to have a hard time convincing a Rubik's cube. What are you talking about? Because they went to see the president of the United States. He said you start looking into Tea Party groups, is that what you're suggesting?

GUTFELD: Yes.

BECKEL: That's absolutely crazy, crazier than you normally are.

GUTFLED: I think the message I get from the Tea Party thing is that every American needs to get involved in this. If you get a target on your back, the target oddly enough becomes a shield, because we have learned that the IRS is now getting in deep trouble for targeting people. If you decide you want to be a target, they can't touch you, and you could bring the IRS down.

PERINO: Very good advice. Think about that. That's very good.

GUTFELD: Thank you very much. I took my pills this morning.

GUILFOYLE: You are in a better mood.

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The Five, hosted by Bob Beckel, Eric Bolling, Kimberly Guilfoyle, Greg Gutfeld, Dana Perino, Juan Williams, and Andrea Tantaros, airs on Weekdays at 5PM ET on Fox News Channel.