I am sure my thoughts on this are not going to be in the mainstream -- but here they are anyway.
The President is the Commander in Chief, and that comes with a lot of power. Additionally, after 9/11, the Executive Branch was granted by Congress a lot of power in conducting the war on terror with the 2001 Authorization to Use Military Force, which gives the President authority to use all necessary force to destroy Al Qaeda and its affiliates.
I was a firm believer at the time, and remain a firm believer, that this includes the power to kill enemy combatants wherever they might be located -- and regardless of their nationality. If you grant that the President has the power to use drone strikes to target Al Qaeda and its affiliates, then it stands to reason that such ability also includes US citizens who have taken up arms against their government and supported these terror organizations.
If you accept that the President has the power to kill terrorists, who are also American citizens, on a foreign battlefield, then why would that power stop at the border of the United States? I think Holder stated the position poorly, but I think his position is correct. In theory, the President does have the power to kill an American citizen inside the United States via a drone strike -- if that person is acting in support of Al Qaeda or their affiliates. Now, the liklihood of this actually occuring is close to zero -- as I would argue that the collateral damage from such a strike in a populated area would be completely unacceptable and violate the rights of those who were the collateral damage. That said, I can see a scenario where this would not be the case -- in which I would have no problem with a drone strike killing an American citizen who is working with these terror groups.
So, Senator Paul's filibuster made for great political theatre, but not much else. He framed the argument as a group of noncombatants might suddenly be blown up in a drone strike while sitting in a cafe -- but that is a straw man argument. The government can only target enemy combatants -- who might also happen to be citizens. Now, we can get into a debate of transparency about how those affiliations are defined -- but to the question of does the President possess this power -- the answer is a clear yes -- and rightfully so in my opinion.