curious things, places where a guy named "jimmy who" began his journey to become president carter. places where inevitable winners like hillary clinton and howard dean lost. places where somebody could rewrite the story that this republican race has come down to mitt versus newt. somebody like ron paul. >> newt gingrich has been on both sides of a long list of issues. sometimes in the same week. >> it's wrong to go around and adopt radically different positions. because then people have to ask themselves what will you tell me next time? ron paul hit newt gingrich pretty hard this week and he's got the money to keep at it. $3.6 million in cash. even better, he's got the army, "time" magazine reports paul insiders claim to have hard pledges from 20,000 caucusgoers, a record 120,000 iowans showed up in the 2008 republican caucuses. and one more number. 30. congressman paul joins me now from his home state of texas. congressman, you were greeted this morning by a new "des moines register" poll that i want to share with our audience. it is showing newt gingrich on top at 25%. and then coming in second, ron paul at 18%. beating out mitt romney at 16%. and everyone else in the single digits. how do you take these numbers and roll it into a victory in january? have you got the manpower to do it? >> of course it is very encouraging because we're getting pretty close to it being within the margin of error. so i think we continue to do what we're doing. we've had the flavors of the month up and down so far in this campaign. i'd like to think of myself as the flavor of the decade. we keep plodding along on a couple of issues that are really striking a chord with the people. and that is, of course, the wars, the end of the wars going on, as well as the financial condition of the country, because i've been talking about the housing bubble and the financial situation that we have and the crisis going on and even the recent promises that we, the united states, with our dollar, will bail out europe. so these issues are, you know, striking a chord with the people and i think this is why we are doing so well in the polls. not only in iowa but we have some similar results up in new hampshire. >> you are in fact doing well in new hampshire. but i wanted to ask you, i want to show another poll that we have done. this is a cnn/orc poll. the question is, which republican candidate has the best chance to beat president obama? mitt romney, 40%. newt gingrich, 21%. herman cain was still in it when this poll came out, 16%. you are down at 4%. this is a poll among republicans. so the very -- there are republicans in iowa putting you in second place, and yet only 4% of republicans see you as the one best able to beat president obama. can you explain that to me? >> well, if you're starting to talk about the general election, that poll doesn't mean very much because you take -- even in the primary up in new hampshire, you know, the largest number of registered voters in new hampshire are independent. but go out and do a poll just on independents and put my name up against obama. all of a sudden, the disenfranchised and the people from the left who are upset with the constant wars and the attack on our civil liberties, they're really down on the president. and they're down on the economy. so i would bet you we get a completely different result. you don't win just with the hardcore republican base. you have to have a candidate that's going to appeal across the political spectrum, and i think with my views they're quite different than the hard-edged views that so many on the republican side frequently are showing. >> well, in fact, you're right, it does take more than just republicans, or for democrats, just democrats, to win a general election. but, would you agree with the premise that when it -- when it comes down to that night in iowa and when it comes down to that primary night in new hampshire, what republicans most want -- and they are the ones who are going to decide the nominee -- what they most want is someone who can beat president obama and they rate so many people above you. that's why i think it is important to talk about electability, because it is a factor in how people view you. >> yeah. you know, i would say that if the people in iowa wouldn't consider me a good option to beat obama i wouldn't be a close second there. so it is already reflecting a favorable rating for that. but i think you point out -- maybe you're giving me subtly some good advice. you better keep working, and that is what we have to convince the primary voters that we can do a good job in the general and that, of course, is part of the campaign. i think that's where we're making progress. >> congressman, you don't want to take election advice from me no matter what. let me ask you about the departure of herman cain. what is it inside -- this was a man with huge appeal to the tea party. >> right. >> and who does leave some voters in iowa and elsewhere looking for another candidate. what is it in ron paul's campaign that might attract a former herman cain supporter? >> well, i think you mentioned the right word -- the tea party people -- because actually the tea party was started during the last campaign four years ago with our campaign. it's morphed into different things and it's broad-based and it is not monolithic. but there are a lot of people who call themselves tea party people that did like the independent mind in this of herman cain. so i think that we'll probably do better, even though some people are saying, oh, no, they're all going to go to so-and-so. but, no, i think that -- we're paying a lot of attention to that, because obviously they're going to go somewhere in the next week or so. that's going to happen. so i'm optimistic that we'll pick up some votes from there. >> i don't know if you know it, but you are in a bit of a tiff with donald trump at this point, who was told that you were not going to participate in a debate that he apparently is going to host. he said nobody takes him seriously, he's a clown, et cetera, et cetera. i know you didn't -- you did not want to participate in the debate because you feel similarly about donald trump. do you think the republican party hurts itself by having a high-profile debate with donald trump as the moderator? >> well, yeah. and of course some of that debate was going on from what the staffers that would like to take him on, but obviously he was representing me. but, yes. i think they hurt themselves. but in the statement that i approved, it said that one of the concerns that i had was really how he was treating the republican party of iowa. and he didn't treat them well because he had agreed to come to their biggest fundraiser of the year because he was talking about running. when he changed his mind about not running he canceled on them. they had to cancel an event. that was a bit of an insult to them. so i've gotten a lot of good, favorable responses from the people of iowa, even the people in the party that appreciated the fact that i mentioned that because they were very unhappy with the way he treated them by just stiffing them and walking away from it and they were left holding the bag. >> what do you make of his popularity? i mean, he said my poll numbers whether i was in are higher than ron paul's. why do you think people like him? newt gingrich is going to this debate. others have said they're going to the debate, but you don't want to. >> yeah, i don't quite understand it. i don't understand the marching to his office. i mean, i didn't know that he had an ability to lay on hands, you know, and anoint people. but i have to just do my thing. i don't think -- obviously -- you know, early on, even at cpac, he volunteered the first attack on me. but evidently, you know, he probably doesn't like my position on the federal reserve. easy credit for developers and investors, you know they like easy credit and they like the federal reserve and they like that for bailing out. so i don't know. maybe deep down philosophic. of course his position on china was quite different. so i think it is philosophic and probably his personality that doesn't like to be challenged. >> let me -- this week the president has gotten a lot of good news that might be able to sort of pump up his campaign. consumer confidence is up. new home sales are up. construction spending is up. and unemployment is down. do you think this helps his campaign? and it fits in to what certainly the obama re-elect people have told us, which is they just have to show people that the trajectory of the economy is going in the right direction, and certainly this week would say that it is. >> well, i think so. i think the headlines helped him. sometimes i think we overdo it. presidents get a lot of credit and a lot of blame, and sometimes they deserve neither. i think the headlines helps him. but when you go out and talk to the people, all of a sudden the people i talk to aren't that optimistic. and when you look at those unemployment figures, actually unemployment is still a serious problem. there's more people dropped out of the workforce than the people who got jobs. if you use the old-fashioned way of measuring unemployment, the statistics are pretty bad. the tendency of the government when it talks about unemployment or the cpi, the inflation rate, they fudge the figures if they're not very favorable. the unemployment, if you measure them the way we used to measure them, actually -- and i believe these figures -- the free-market economists who measure say we have 22% unemployment when you add up everybody who doesn't look for work, who are just partially employed or the people looking for jobs. so it is bad. people know it. the sentiment is bad, and they also understand that their cost of living is going up and their standard of living is going down and there's very little confidence out there. but, superficially and for a short time, maybe these headlines will give a little bump. but believe me, a bump from the very bottom on housing really doesn't re-assure that many people. >> congressman and presidential candidate ron paul, thank you for joining us today. if you want more of ron paul, check out "just in time for christmas," the ron paul family cookbook. coming up, michele bachmann and why she thinks she's the only real conservative in the race. both relieve coughs, snee, aches, fevers. tylenol: and i relieve nasal congestion. nyquil (stuffy): overachiever. anncr vo: tylenol cold multi-symptom nighttime relieves nasal congestion... nyquil cold & flu doesn't. 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[ electronic beeping ] [ male announcer ] still getting dandruff? neutrogena® t/gel shampoo defeats dandruff after just one use. t/gel shampoo. it works. neutrogena®. joining me from new york, michele bachmann, republican presidential candidate, and author of "core of conviction, my story." congresswoman, thank you so much for joining us. the latest thing in this race, obviously herman cain has withdrawn. how does that change the dynamic going forward? >> well, i think herman cain brought a really important, exciting, energetic voice to the race, and i think a lot of people are going to be very sorry to see him go. we've been talking with the herman cain campaign, and i look forward to having a full conversation with him. one thing that we've seen is that a lot of herman cain supporters have been calling our office, and they've been coming over to our side. i think part of that is because people see that i'm the tea party candidate in the race. they saw herman cain as an outsider, and i think they see that my voice would be the one that would be mow reflective of his. >> one thing that we're seeing, there is a new "des moines register" poll out where people are asked their second choices, because as you know, in those caucuses second choices very often count. what they are finding that when you take herman cain out of the mix, the person who benefits most from that is former speaker newt gingrich. how do you account for that? >> well, i think the dynamic is changing all the time in this race. it is almost like wall street, candy. it is the up-and-down political wall street, if you will. candidates are going up and candidates are going down. and really i think it is when the voters take a look at the candidates, they want to see who's the most consistent conservative. as the layers are peeled back, we find out who the candidates are, if they've supported everything from the health care mandate to the wall street bailout, they turn away. when they find out that i'm the candidate who stands the most for their values, that's when they come home. people saw this in the iowa straw poll that i won, that i wasn't expected to win that race and i won because people ultimately saw i was the most consistent conservative. that's really also the title of my book, "core of conviction." i think they're going to see that now also on january 3rd and i think they're going to be moving over. we've got 30 days. that is an eternity in this race. >> it is an eternity, and yet as you know every day counts. and you bring up that you're the tea party candidate. certainly you framed yourself that way. but i want to show you a poll about republicans' choice for nominee among tea party supporters. this was a poll of tea party supporters. this was before herman cain went out. 29%, followed by newt gingrich at 21%, mitt romney at 18%, and then michele bachmann at 7%. so it seems that that tea party patina has somewhat come off of you. how do you gain that back? how do you explain this? >> well, i think again it has to do with people finding out where people truly stand on the issues. if you look at, for instance, both mitt romney and newt gingrich, both of them have supported the essence of obama care. that's not something that the tea party supports. i'm the biggest fighter against obama care. of all the candidates in the race, i'm the one that's actually going to get rid of it as president of the united states, and the same thing with the global warming initiatives. both newt gingrich and mitt romney also supported the global warming initiatives. that's not something that the tea party stands for or the wall street bailout. i'm the one who opposed the wall street bailout. both mitt romney and newt gingrich supported the wall street bailout. so as tea partiers see where the candidates stand, they're going to come home. i think on january 3rd in iowa they're going to come home and vote for me in that caucus. >> do you think any of this -- because certainly voters in iowa at this point ought to be pretty familiar with your record. you've been there a lot. as well as in new hampshire. but more in iowa. do you think any of this could be in whether people view you as electable? because it does tend in the polls to show that more people view the others as electable rather than you. >> well, the best poll that you have is the iowa straw poll. clearly they saw that i was the most electable. if you also look at the polls, upwards of 70% of the people are still undecided. they take this process very seriously, and they're vetting all of the candidates. weighing each one of them because they realize barack obama cannot have a second term. we have to have a strong, bold candidate for president. so they're taking a look at the candidates. and there is a lot of surprises that they're finding in this race and a lot of surprises with the candidates. after they look at them, they're going to see, of all of the candidates, i'm the one who doesn't have the political surprises. that's why we have a website nosurprises2012.com. people see i am the consistent conservative who will shred barack obama's policies in the debates. >> let me ask you about the trajectory, if you will, of tea party support. a pew poll that was in early november, do you agree or disagree with the tea party? agree, 20%. disagree, 27%. all the polling, ours and others, also show that the negativity of how people view the tea party has gone way up. is it possible that the tea party has overplayed its hand and is seen as too hard core? >> oh, for heaven's sakes, no. if people know -- if you ask people what the tea party stands for, if you say, do you believe that you're taxed enough already, that's the essence of the tea party. most people agree with the tea party. if you ask people do you think that government should spend less money than what it takes in, most people agree with that. do you think that the government should follow the constitution. most people agree. those are the three core principles of the tea party movement. so people agree with the essence of the tea party. that's why i believe fundamentally they have the strength. the strength is not with occupy wall street. if you go to the essence of what occupy wall street stands for, it's having other people pay for their stuff. that's not where the american people are at. that's why i think you're going to see a very strong, bold turnout in the elections, because people are turning against barack obama in his failed policies. >> let me ask you about those tax cuts, because you are opposed to extending the tax cuts now in place whereby people are not paying as much in payroll taxes as they had been last year. so that's a tax cut. it will go away in january unless congress does something. and yet you oppose extending that tax cut. how does that square with the idea that people should have more of their money to spend? >> well, i opposed it when it first came up a year ago last december. i voted against it and i'll tell you why. because it blows a hole of $111 billion in the social security trust fund. that's what it goes to fund. >> but couldn't you argue the bush tax cuts blow a hole in the deficit? i mean you can argue that for other tax cuts that you favor. so i'm trying to figure out why this one is different. >> well, because the payroll tax directly funds the social security trust fund. right now we need that $111 billion in the social security trust fund. and you also have to remember, candy, the president's reason. he said he wanted to lower that -- the payroll tax cut because it would create jobs. even the administration admits it didn't create jobs. it hasn't helped to turn the economy around. as president of the united states, i know what to do to turn the economy around. i'm a former federal tax lawyer. i created and i run a successful business as a private business woman. i get the economy. this payroll tax deduction didn