Live

Watch CBSN Live

McCain: Paulson, Bernanke Misled Me on Bank Bailout

(CBS)
Sen. John McCain said he was misled by former Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke about the intent of the Troubled Asset Relief Program (TARP), or the bank bailout, the Arizona Republic reports.

Facing an aggressive primary challenge from Arizona conservative talk radio host J.D. Hayworth, McCain has been compelled in recent months to tack right on partisan issues and explain past votes.

In a meeting Thursday with the Republic's editorial board, McCain reportedly said Paulson and Bernanke initially assured him the $700 billion bailout would focus on the mortgage meltdown that spurred the financial crisis.

"Obviously, that didn't happen," McCain told the newspaper. "They decided to stabilize the Wall Street institutions, bail out (insurance giant) AIG, bail out Chrysler, bail out General Motors. . . . What they figured was that if they stabilized Wall Street - I guess it was trickle-down economics - that therefore Main Street would be fine."

McCain defended his vote for TARP, saying "Something had to be done because the world's financial system was on the verge of collapse."

Hayworth, however, has blasted McCain for failing to be a "consistent conservative."

"Rather than calling his bus the straight talk express – given the gulf between his current campaign rhetoric and his record of performance – he might want to name that the double talk express," Hayworth told CBS News.

View CBS News In