McCain: 'A waste of taxpayers' dollars'

JIM CRAMER, CNBC ANCHOR:  Sen. McCain, Jim Cramer here.

One of the things that we’ve heard is that Warren Buffet came out on CNBC and said this bill-this mortgage bill is going to be great for the taxpayer, and he wants in.  He actually wants to invest.  Why don’t you tell people that those who believe in the American people, those who believe that homeowners will fight to keep their homes are bankable and you want to be able to invest side by side with the U.S. Government because this plan will produce a profit?

MCCAIN: Well, I think that this plan will produce a profit. I’m glad to say that when it does, that the taxpayers will be paid back first, which is an important provision in this bill.

I also know, Jim, that you and I may have a difference on this curbing of CEO pay.  But the fact is CEO pay-CEOs have wrecked their reputation by these exorbitant bonuses and packages and stuff.  But the fundamentals of this package are good, they’re strong, and the options of loans or insurance or outright purchases of these institutions, I think, gives some tools to secretary of treasury and the oversight board that, I think, I think we can recover.

But, Jim, I know you’ve been saying this. This is a tourniquet. 

This isn’t a cure. OK?  This is a tourniquet to stop the bleeding. Now, we have to go about fixing the fundamental problems in our economy, and that’s going to be long and hard and tough. Let’s not dilute anybody about the tough road that lies ahead of us.

CRAMER: You’ve called for the resignation or firing of Christopher Cox, the SEC chairman.  He has been quite inept and has hurt Wall Street.  Would you go as far as to say that, perhaps, Ben Bernanke should be replaced given the fact he was worried about inflation when we have a deflationary spiral like 1932 happening?

MCCAIN: I’m not overall pleased with his performance, but I think it’s a little bit different from the person, the individual specifically assigned to regulate. And Chris Cox is a fine and honorable man, don’t get me wrong.  But when the captain is asleep in the cabin and the ship runs aground, it’s the captain that’s still responsible.

Accountability. Dwight David Eisenhower, the night before the invasion of Normandy, he wrote out two letters. One praising the men and women for their success who made that incredible invasion possible and the other a letter of resignation from the Army in case it had failed taking full responsibility. We need more leaders like Dwight David Eisenhower.

SCARBOROUGH:  Sen. McCain, I had a friend yesterday e-mail me, a 2003 New York Times article where the Bush Administration and some leaders on Capitol Hill were expressing concern already about Fannie and Freddie. He said he needed to take more control of it.

Barney Frank was very critical saying that nothing was wrong with Fannie and Freddie. Other Democrats said that that was the wrong step to take. Let me ask you, where were you in 2003 when the White House and treasury officials started-that’s five years ago-started warning about problems that were inside of Fannie and Freddie?

MCCAIN: I was partially engaged, let me say, that I also had those same concerns.  I articulated those concerns two years ago including co-sponsoring legislation to rein them in to stop these abusive practices.  I was actively engaged at that time.  A lot of us saw it coming.

Look, this is inside-the-Beltway cronyism of the worst kind, political campaign contributions.  It really is one of the sad stories of America, and it shows the incredible influence of lobbyists and special interest within-within Washington, D.C.

Yes.  I was against it and sponsored legislation to try to bring it under control a couple of years ago.

SCARBOROUGH:  All right.  And finally, Senator, you admitted this past week that you are a gambling man.  My question is this.  Can the Cubbies come back from a 1-0 deficit?  Can the Angels come back from a 1-0 deficit?  Who’s going to make it to the World Series?  And if you’re a gambling man, who would you put your money on?

MCCAIN:  I don’t know. I still kind of like the Red Sox. I have a sentimental favorite, look.  And I think that they’re going to do well now that my Diamondbacks have blown it.  I think the Dodgers are not to be underestimated given the fact that they got some pretty strong pitching.

SCARBOROUGH:  Yes.

MCCAIN:  So I think it’s very possible that both of those teams-both the Dodgers and the Red Sox could surprise everybody.

BRZEZINSKI:  Oh, boy.

SCARBOROUGH:  Boy, those are two class (inaudible).

MCCAIN:  But that shows you why I’m not a rich man.

(LAUGHTER)

SCARBOROUGH:  All right.  Sen. John McCain, thank you so much.

BRZEZINSKI:  And Senator, it’s such a complex issue, this crisis we’re facing.  We thank you for putting yourself out there and talking to Americans about it.  Thank you so much.

MCCAIN:  It’s a pleasure.

SCARBOROUGH:  Yes.  Thank you so much, Senator.  We appreciate it.

MCCAIN:  Thank you for having me on.

SCARBOROUGH:  Sen. McCain-say what you will, Mika Brzezinski, Sen. McCain doesn’t hide the morning after the vote.  He comes out and he talks about it and we greatly appreciate it.  And thank you, Mika, and of course, Jim Cramer, who’s been with us all morning.

CRAMER:  Thank you.

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