Republican presidential nominee Sen. John McCain, R-Ariz., joined Joe Scarborough earlier this morning on "Morning Joe." McCain addressed some of the bailout bill's tax breaks saying the system in Washington needs to change.
A rush transcript of the interview is below.
JOE SCARBOROUGH, CO-HOST, 'MORNING JOE': We’ve got Sen. John McCain, and we can ask him. Let’s bring in now, Republican presidential nominee, Sen. John McCain.
Sen. McCain, all morning we’ve been showing some of the pork through tax extenders that was put into this bill last night. Please explain to Americans, and let’s put the list up again. You’ve got almost $200 million in this bill for tax breaks for Puerto Rican and Virgin Island rum producers, $128 million for people who make auto racing tracks, wool research, kids wooden arrows $6 million.
Here, we have what Warren Buffet’s calling our economic Pearl Harbor, and the Senate still can’t help themselves. Why did these items have to be in this critical bill?
SEN. JOHN MCCAIN, PRESIDENTIAL CANDIDATE: Well, that’s just the way the system is working in Washington and the reason why it’s got to be fixed and it’s got to be changed. And no matter what the stakes are, you’ve got to stop this by starting to veto bills that come across the president’s desk. They can’t help themselves.
And if you like some of those pork barrel projects, look at some of the ones that Sen. Obama has proposed. Over $932 million worth of pork of barrel projects.
SCARBOROUGH: You know, Senator, though, what’s so staggering is the fact that even before Obama was in the Senate, after 9-11, my God, 9-11, while Ground Zero was still smoldering, you all passed a bill to take care of it, to protect this country, and people used the 9-11 relief bill to put pork barrel projects in there.
It’s just-it’s insanity.
MCCAIN: It’s insanity, and it’s obscenity because it’s a waste of taxpayer’s dollars, and it goes on. And until we stop it, until we get, frankly, a president who will say I’m going to veto those bills, I’m going to make the people famous that put them on there, famous-and by the way, Joe, you know that this problem has grown and grown and grown.
The last couple of years, they’ve had some restraint, but it will continue to grow, and it’s-it’s-it’s terrible. And it really is corrupting because...
SCARBOROUGH: The buck, though, stops...
SCARBOROUGH: Go ahead. I’m sorry, Senator.
MCCAIN: The corruption in Washington is not the lobbyists. It’s the system that allows the lobbyists to take advantage of these backroom deals, these pork barrel projects, these outrageous procedures that the Americans don’t know about. You’ve got to fix the system. Then the symptoms of it, I think, in a large degree, are taken care of.
SCARBOROUGH: All right. Senator, explain this to me. When George W. Bush became president of the United States, we had a $105 billion surplus. We have now seen that-that surplus go to a deficit. We’ve going to have a $500 billion deficit year, a $5 trillion debt became a $10 trillion debt.
George W. Bush never vetoed a single spending bill while Rome was burning. Why not?
MCCAIN: Because they believed that having the majority for a long time-not the last two years-that they didn’t want to harm the old boy cozy network that existed and cause these earmark spending to lurch completely out of control. You remember they were literally auctioning off chairmanships of committees, and I and others fought tooth and nail against it, railed against it.
I was called the sheriff. I was able to eliminate a lot of these projects, and there’s a handful of us that have been fighting and warning that this could be incredibly harmful to the Republican Party.
We came to power in ‘94 to change Washington, and Washington changed us.
And there’s a sharp difference, a total difference between myself and President Bush on the issue of pork barrel and earmark and out-of-control spending and the growth of government without paying for it. Don’t forget that part.
SCARBOROUGH: No doubt about it. Let’s turn from the bill that was passed last night to what’s going to happen tonight. Sarah Palin’s going to be debating Joe Biden. Sarah has not done very well in some of these one-on-one interviews with Katie Couric and Charlie Gibson.
Do you believe-would you be willing to admit this morning that your campaign may not have handled Sarah Palin as well as they should have during the past month?
MCCAIN: No. I think we’ve handled her fine. I think the criticism and the attacks have been unprecedented. She’ll be just fine. She’ll do fine tonight.
Whenever she’s between her and the American people, she does just fine. She’s experienced. She’s knowledgeable. She’s very strong person. I’m proud of her record, and I’m proud of her.
MIKA BRZEZINSKI, CO-HOST, 'MORNING JOE': Senator, it’s Mika Brzezinski here in New York, and we’ll be watching the debate tonight to see what happens. I want to just ask you one final question, though, about the bill because I think given, especially what you’ve been just saying on our broadcast right now, why then didn’t you vote against a bill that is corrupting and stand up to pork and all this spending during an economic crisis that some say this-puts this country on the brink of-of economic disaster?
MCCAIN: Because of what you just said, Mika, that this bill is putting us on the brink of economic disaster. There were plenty of other bills that I fought against, voted against-well, the bill to-you know, the Medicare prescription drug program, I was-I voted against it because it didn’t-because of the fact that it wasn’t paid for. We’re laying the cost on to future generations of Americans.
I’ve fought against plenty of bills. I am proud of my work spending my campaign, coming back to Washington, getting the Republicans at the table which they were not, improving the bill, and I believe it will pass.
Sen. Obama phoned it in.
BRZEZINSKI: But if we’re going to have leadership through a crisis like this, and if we’re going to look to you for that leadership, don’t we have to stand up to the very things that are bringing Washington and, at this point, Wall Street, down?
MCCAIN: If you look at the Citizens for a Sound Economy, the National Taxpayers Union, the Citizens against Government Waste, I have been a hero to them because I have fought continuously, continuously against these.
Sen. Obama has never stood up to the leadership of his party on any issue. Not a one. And I fought the leadership of my party and I have had success. I saved the taxpayers $6.8 billion on a tanker deal that was-that was going to cost the taxpayers that much because of this cozy deal. It ended up with people in jail.
I investigated Jack Abramoff, the leading-and he’s now in jail. The leading lobbyist in Washington, I fought against his pork barrel spending. And my record is very clear. Sen. Obama never has. There’s a difference.
SCARBOROUGH: So Senator, of course, there’s an old saying that a week is a lifetime in politics.
SCARBOROUGH: The past two weeks have not been very good for you. A new Time-CNN group of polls from battleground states show you losing ground in Florida, Minnesota, Missouri, Nevada, Virginia. What’s happened over the past two weeks? Why did we go from a month where you had all the momentum, the wind was at your back, your poll numbers were going up, to the past two weeks where you have been dropping in just about every poll?
MCCAIN: Well, first of all, Joe, you know very well that these are temporary things. The fact is...
MCCAIN: ... the focus was on fiscal we were facing. I understand that. And I’d there’s going to be ups and downs in political campaigns. I’m happy with where I am. I’m happy with where we’re going. We’re the underdog. I love being the underdog. And we’re going to be just fine starting tonight with Sarah Palin’s performance. And I’m confident that as the polls bounce up and down, we’re going to be up late on election night.
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.
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.
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.