Paul is very critical of FEMA:
http://www.foxnews.com/politics/2011/08/28/paul-fema-is-real-disaster/
I assume by his language he would end it.
All in all...FEMA is very bad. It creates false dependency and a lack of accountability. It also does what private insurance is supposed to do and if there is any role for government in aiding areas hit by a disaster...it should be on the state government...not on the federal government.
If people are accountable for their actions, they will less likely build along flood plains, in tsunami zones, earth quake area, in the middle of wild-fire prone forests and on the shores of hurricane states. They will also build their buildings to be more resistant to these types of events.
Too often when a natural disaster strikes...it's too complicated and nuanced for the federal government to launch effective help. Often times it is locals who do most of the rescuing and rebuilding because they know the area best. Volunteers and not-for-profit aid organizations do a much better job than FEMA in reacting to disaster areas.
Too often the case, states apply for FEMA aid just because it is free money...not because they actually need it. In Wisconsin, whenever there is any type of minor flooding or tornadoes...our politicians whine and lobby the feds to declare counties 'disaster zones' so they can get free checks. The entire process is subjective, complicated, time consuming and a complete mess that locals should be addressing. Wisconsin always wants their money because they point our (rightfuly so) that states like California and Florida hog the share of FEMA funds.
As for Yellowstone

...interesting story. I'm not worried myself. Put your finger over a garden hose and you get a strong tall stream of water. Remove the finger and the water just bubbles around harmlessly enough. The caldera that Yellowstone is in is too wide and thin. For a massive explosion to happen, a high concentration of gasses would have to be released in one small little area...but because the caldera would be too wide and fragile...I don't see this happening...and worse case scenario we just have a lot of bubbling and gas.