Calling someone a 'psycho' at the outset is really really not productive. Ed's usually more respectful than that, so I'm guessing this was some producer's idea. Anyway, he didn't even give Paul a chance to say anything so why even have him there in person?
I don't know about getting rid of these agencies completely, but they're definitely bloated, the Dept. of Agriculture in particular. Paul's right in that most of the money for farm subsidies actually winds up going not to family farms but to Cargill and Monsanto et al. They don't need the help. As far as safety, how many inspectors are there per facility? Not that many. At least get rid of the subsidies and raise the number and quality of inspectors.
The Education Dept. is another matter. While it's true that No Child Left Behind is a joke, and it's true that spending per student does not determine student success exclusively, it's also too much administration at the local level, too little parental involvement (possibly cause they're working too much or care too little), and a subculture that just doesn't care about education is at least as important as a Fed agency. Oh, and school boards that still think Jesus had a pet Terradactyl. They don't help.
There were points there that Paul was making sense, as far as I'm concerned. It was actually Big Ed that seemed nuts.
Watch it for yourself:
http://www.msnbc.msn.com/id/30031533/