FLASHBACK: In 2007, McCain Admitted He ‘Did Not’ Anticipate Financial Crisis

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"FLASHBACK: In 2007, McCain Admitted He ‘Did Not’ Anticipate Financial Crisis"

This week, Sen. John McCain (R-AZ) has been repeatedly saying that the nation is in its current economic condition because no one listened to him. According to McCain, as far back as two years ago, he had “warned” federal officials of problems such as a potential subprime mortgage crisis. Watch a compilation:

However, as ABC points out, this claim seems to be an exaggeration. In an interview with the NH Sentinel Source in November 2007, McCain admitted that he was clueless about the economic mess:

Q: Well the dimension of this problem may be surprising to a lot of people, but to many people, to many others there were feelings that there was something amiss, something was going too fast, something was a little too hot. … Were you surprised?

McCAIN: Yeah. And I was surprised at the dot-com collapse and I was surprised at other times in our history. […]

I don’t know of hardly anybody, with the exception of a handful, that said “wait a minute, this thing is getting completely out of hand and is overheating.” So, I’d like to tell you that I did anticipate it, but I have to give you straight talk, I did not.

Watch it:

McCain claiming that he had more economic foresight than the rest of the country now seems odd, considering that also in this interview he said that this was “something that frankly I don’t know a lot about.” A month after that interview, in December 2007, McCain was still admitting, “The issue of economics is not something I’ve understood as well as I should.”

Transcript:

Q: Well the dimension of this problem may be surprising to a lot of people, but to many people, to many others there were feelings that there was something amiss, something was going too fast, something was a little too hot. Going back several years. Were you one of them? Or, I mean you’re a busy guy, you’re looking at a lot of things, maybe subprime mortgages wasn’t something you focused on every day. Were you surprised?

McCAIN: Yeah. And I was surprised at the dot-com collapse and I was surprised at other times in our history. I don’t know if surprised is the word, but —

Q: S&Ls?

McCAIN: I don’t — what did you say?

Q: The S&Ls.

McCAIN: Yeah, the S&Ls.

Q: Is this bigger than that?

McCAIN: I don’t know the dimensions of this. It’s hard to know what the dimensions are. As I say, I never thought I’d pick up the paper and see a city in Norway is somehow dramatically impacted by it. When I say “surprised” I’m not surprised when in capitalist systems that there’s greed and excess. I think it was Teddy Roosevelt who said “unfettered capitalism leads to corruption” or something like that, that people have disputed for years.

But so, in this whole new derivative stuff, and SIBs and all of this kind of new ways of packaging mortgages together and all that is something that frankly I don’t know a lot about.

But I do rely on a lot of smart people that I have that are both in my employ and acquaintances of mine. And most of them did not anticipate this. Most of them, I mean I can find some that did. But, a guy that’s on my staff named Doug Holtz-Eakin, who was once the head of the Office of Management and Budget, said that there was nervousness out there. There’s nervousness. There was nervousness that we had such a long period of prosperity without a downturn because of the history of our economy. But I don’t know of hardly anybody, with the exception of a handful, that said “wait a minute, this thing is getting completely out of hand and is overheating.”

So, I’d like to tell you that I did anticipate it, but I have to give you straight talk, I did not.

Update
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In his interview 2007 with the NH Sentinel Source, McCain erroneously refers to his economic adviser, Doug Holtz-Eakin, as “once the head of the Office of Management and Budget.” In fact, Holtz-Eakin is a former head of the Congressional Budget Office — not the OMB, which is an office in the White House.

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