Larry Kudlow: That’s right, folks. My lead story tonight is an exclusive interview with Congressman Ron Paul, he’s still very much a factor in the Republican race. And the sizzle story today is the shocking charge that Ron Paul has an alliance with Mitt Romney that could lead to his son, Senator Rand Paul, being installed as the Romney vice-president. Take a listen to all this.
Joining us exclusively now is Texas Republican Congressman, and presidential candidate, Ron Paul. Dr. Paul, welcome back to the show, as always, sir. Let me begin with this: Rick Santorum was whining this morning on the Laura Ingraham Radio Show, he was whining that you are attacking him too much, and you never attack Mitt Romney, and he’s accusing you of having an alliance with Mitt Romney. What’s your reaction to that? I thought this would be a great spot for you to respond to this Santorum business.
Ron Paul: Well, if anybody would check the records very carefully, you know, I’ve had Mitt in the ads as well, or earlier on, and I called him a flip-flopper and all these things. But I think it’s partially strategy, if I have to compete against Mitt Romney, I have to take away the votes from the other people who are competing with me. So it’s a bit of strategy, but it’s also because he’s topping the polls right now and I’m very honest about his voting record, it wasn’t like I made it up. And I try very hard to stick to the voting record when I criticize him, but he really wasn’t a real good conservative.
Larry Kudlow: That’s the thing, you called him a fake during the debate, and I wondered if you’d expand on that thought?
Ron Paul: Well, it was whether or not I would defend it, because that’s in our ad, because he pretends he’s the most conservative and he’s the conservative alternative to Romney but, philosophically, I don’t see a whole lot of difference. But Rick has gotten himself into more trouble because he was the whip, and when he said he was a team player, that was one of the things that has annoyed me the most. Because when they’re whipping you and they think they can get your vote, they finally come down. The ultimate test is for the speaker to come to somebody in the House and say, “You got to do it, you got to be part of the team. And this is what Santorum was saying, “It’s a team thing”. And I think that’s what is wrong that’s what I said in the debates, I think that’s what’s wrong with Washington. I said, “No, it isn’t, it’s good economic policy, good foreign policy, follow the oath of office, follow your promises. But it’s not to go along to get along and to participate”. I don’t know if you’ve recognized over the years, when we have a Republican president, the Republican Congress sort of whips out. Right now, I vote much more with the Republicans in the Congress, but when we had a Republican president, that wasn’t the case. And I think when Santorum was there, he had to defend the moderate policy of a moderate president, and that’s how he gets himself into trouble. But to claim that he’s a real sound fiscal conservative, I think that’s where I think he’s faking it.
Larry Kudlow: Let me take this up; okay, he’s faking it. My friend, Joe Scarborough, former House member (you probably know him), has been speculating and ruminating that you do have an alliance with Mr. Romney. But Scarborough’s take is, and I want to get your reaction to this, that it’s about your son, Senator Rand Paul. Because there could be a deal that Rand Paul will go under a Romney ticket as vice president, or would serve in a position in the cabinet in a Romney administration. So now we’ve gone from a potential from whining from Santorum to an alliance between you and Romney in order to get Senator Rand Paul a job as VP, or a cabinet secretary. Your reaction to that train of thinking?
Ron Paul: Well, I don’t think my son needs my help to get him a job. Besides, I think that’s a distraction from Rick’s performance, because he knows now that he was knocked down a few points and, therefore he has to distract from that and say it was something sinister or some type of alliance, and the media likes that kind of stuff. But the truth is, Rand and I have never had a talk along those lines, about what our political strategy is, because there really isn’t any. There are times when different candidates align themselves in different ways depending on what states they’re in, but I have to admit, it’s been easier to talk. My staff has an easier time talking to Mitt Romney and, of course, I’ve known him for a long time and at least we’re respectful to each other, which is a little bit different with what happens with the other candidates.
Larry Kudlow: But you can’t say there is no clear alliance between you and Mr. Romney?
Ron Paul: Absolutely not, because it would be foolish on his part and I think I did hear something this morning when they were interviewing Governor Pawlenty, and they were saying, “Yea, there is some conspiracy and there’s a backroom deal. And I thought Pawlenty cleared it up pretty well, he said, “If you think Ron Paul is going to do a backroom deal, you got another thought coming”, something along those lines
Larry Kudlow: Alright, we’ll leave it all there, I just want you to be clear and go on the record on that. Let me ask you, I want to talk taxes, you and I often talk about the Fed and money and so forth, but I thought we’d talk taxes this evening. Romney has come out with his 20% across-the-board tax cut, I wonder what’s your thoughts about it. And I wonder, especially, sir, specifically, what does your tax reform plan look like?
Ron Paul: Well, my ultimate goal would, of course, be to get rid of the income tax and get rid of the corporate tax, but you know that’s a ways off. Because you’d have to change the role of government, you’d have to change the attitude that we police the world and we have an entitlement system. But when I look at a bill or a proposal like that, if I have to accept it or reject it up or down, anything that lowers taxes, I’m for. In any way whatsoever, I’m going to lower taxes, but I’m always willing to cut the spending as well.
Larry Kudlow: But have you set any targets on the way to getting rid of the income tax, a to be desired. But in the mean time, Romney now has a top rate of 28%, Santorum has a top rate at 28%, Gingrich has a flat tax option with 15%. Have you ever pinpointed any of those specifics?
Ron Paul: Well, anything that’s lower. I aim for 0%. If they want 28%, I want 25%, if they want 25%, I’m going to aim for 20%. But that is secondary to the spending, so we have to deal with the whole program. But I think what was in my proposal was a corporate tax of 15%. But it doesn’t give us the answer, it’s this whole attitude that we have to collect all these revenues, and if we don’t collect the revenues, we have debt. So that’s why we have to address the spending and the deficit.
Larry Kudlow: But let me just dwell for a moment on the dollar. Oil prices, as you well know, are surging again, gasoline prices are surging. A lot of people are blaming it on a potential crisis with Iran, some people are blaming it because we don’t drill enough. I just want to ask you from your perspective, your Austrian free market view and your sound money view, is it possible that the chronic rise in the price of oil is because of the chronic devaluation or weakness or lack of confidence in the dollar? Is the dollar the key to the oil prices, or are there other external factors?
Ron Paul: No, I think the dollar is the key, but there’re the other factors, too; the Iranian crisis and the potential that the war is going to start there. So I always look to the oil price as maybe some serious talk behind the scenes that they’re actually getting ready to do something, which scares the living daylights out of me.
Larry Kudlow: Let me just ask you quickly, you mentioned that you’re scared to death about what Iran might do, there could be war in the Middle East. You are known for your non-interventionist foreign policy. If Iran did declare war in the Middle East, if Iran closed the Strait of Hormuz, which might drive oil prices, at least temporarily, to $200 a barrel, would you, as President Paul, take any action against Iran in those events?
Ron Paul: Well, first off, there’s zero chance of that happening, they’re not suicidal, they’re under the gun, they’re surrounded by 45 United States Air Bases and military bases around there country with the navy over there. So they’re not going to commit suicide. And they haven’t even threatened to closed down the Strait of Hormuz unless they’re attacked, they’re trying to say, “Look, you better be careful, or we might retaliate” But I don’t think they will then, too, because they’re going to lose as much as we would lose, because they have to export their oil as well. But the foolishness of this is driving the Iranians into the arms of the Chinese. First we have a new government in Iraq, and it’s not all that friendly, it’s breaking down, and we’ve driven Iraq into the arms of the Iranians, and the Iranians into the arms of the Chinese. The Chinese are making a lot of money from us, and what are they doing with it? They’re investing it around the world, they’re investing in oil and energy in Iran, in Africa and different places. So I think our policy is just foolhardy.
Larry Kudlow: Alright, I’m going to leave it there. Congressman Ron Paul, as always, sir, we enjoyed interviewing you, all the best on the campaign trail.
Ron Paul: Thank you, Larry.
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