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Two Financial Crises, Two McCain Tantrums

September 23, 2008

On Tuesday, paleo-conservative columnist George Will joined Mitt Romney and a long list of Republicans in warning Americans about John McCain's decidedly unpresidential temperament. "Under the pressure of the financial crisis," Will wrote, McCain reacted "furiously." Alas, McCain's rage now is just a repeat of his 1989 temper tantrum as the Keating Five scandal enveloped him during the last U.S. financial meltdown.
In a piece titled simply, "McCain Loses His Head," a horrified Will made the case that McCain's out-of-control temper, festering personal grudges, "impulsive" reactions and "boiling moralism" constituted a worrisome "a harbinger of a McCain presidency":

Under the pressure of the financial crisis, one presidential candidate is behaving like a flustered rookie playing in a league too high. It is not Barack Obama.
Channeling his inner Queen of Hearts, John McCain furiously, and apparently without even looking around at facts, said Chris Cox, chairman of the Securities and Exchange Commission, should be decapitated. This childish reflex provoked the Wall Street Journal to editorialize that "McCain untethered" -- disconnected from knowledge and principle -- had made a "false and deeply unfair" attack on Cox that was "unpresidential" and demonstrated that McCain "doesn't understand what's happening on Wall Street any better than Barack Obama does."

As it turns out, McCain's same "childish reflex" was on display 20 years ago during the Keating Five imbroglio that almost ended his career.

As I detailed previously, McCain's proposal on Thursday to essentially resurrect the Resolution Trust Corporation harkens back to S&L disaster in which he was a central figure. The RTC was an entity signed into law by President George H.W. Bush, which in the 1980's and 1990's ultimately poured $400 billion into hundreds of faltering savings and loan institutions. About $3 billion of that came from the collapse of Charles Keating's Lincoln Financial, the man for whom McCain interceded with federal thrift regulators.
While McCain was ultimately admonished by a Senate ethics panel only for "poor judgment," his behavior in response to the white hot press spotlight raises troubling questions about his fitness to lead. As the Arizona Republic recalled in March 2007:

On Oct. 8, 1989, The Arizona Republic revealed that McCain's wife and her father had invested $359,100 in a Keating shopping center in April 1986, a year before McCain met with the regulators.
The paper also reported that the McCains, sometimes accompanied by their daughter and baby-sitter, had made at least nine trips at Keating's expense, sometimes aboard the American Continental jet. Three of the trips were made during vacations to Keating's opulent Bahamas retreat at Cat Cay.
McCain also did not pay Keating for some of the trips until years after they were taken, after he learned that Keating was in trouble over Lincoln. Total cost: $13,433.
When the story broke, McCain did nothing to help himself.
"You're a liar," McCain said when a Republic reporter asked him about the business relationship between his wife and Keating.
"That's the spouse's involvement, you idiot," McCain said later in the same conversation. "You do understand English, don't you?"
He also belittled reporters when they asked about his wife's ties to Keating.
"It's up to you to find that out, kids."

Ultimately, the paper ran the story. After it broke, McCain held a news conference with his rage in check and calmly answered questions for 90 minutes. (In a preview of the 2008 campaign, McCain's defense was that his wife's finances - and extreme wealth - were separate from his own.)
But McCain's response also revealed another disturbing pattern that continues to this day. After launching a furious tirade against the media, McCain sought to forgiveness after the fact. As the Boston Globe described the episode:

When reporters questioned the investment, John McCain wrote in his autobiography, he "shouted at them, cursed them, and eventually slammed the phone down on them. It was ridiculously immature behavior."

Twenty years later, George Will couldn't agree more.


Jon Perr
Jon Perr is a technology marketing consultant and product strategist who writes about American politics and public policy.

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