McCain, Paul, and the ‘Plunge Protection Team’

"I'm very well versed in economics" is how John McCain responded to a Tim Russert question at last night's GOP presidential debate that referred to a past, possibly self-deprecating statement McCain made about his lack of economic expertise. Yet McCain really seemed to have no clue what Ron Paul was talking about when Paul asked him a question about the President's Working Group on Financial Markets—the so-called Plunge Protection Team—consisting of the Treasury secretary, the Fed chairman, and government regulators—that meets at a principals level during times of financial crisis. Some have conspiratorially speculated that the team has nudged Wall Street banks to buy shares to prop up the U.S. stock market. Here is the exchange:

REP. PAUL: My—my question is for Senator McCain. This is an economic question that I wanted to ask. It has to do with the President's Working Group on Financial Markets. I'd like to know what your opinion is of this and whether you would keep it in place, what their role would be, or you would get rid of this group. And if you kept the group, would you make sure we would see some sunlight and know what they're doing and how they're being involved in our markets?

SEN. MCCAIN: Well, obviously we'd like to see more sunshine. But I as president, as every other president, rely primarily on my secretary of the Treasury, on my Council of Economic Advisers, on the head of that. I would rely on the circle that I have developed over many years of people like Jack Kemp, Phil Gramm, Warren Rudman, Pete Peterson, and the Concord Group. I have a process of leadership, Ron, that is sort of an inclusive one that I have developed, a circle of acquaintances and people that are supporters and friends of mine who I have worked with for many, many years.

REP. PAUL: So you'd get rid of the group?

SEN. MCCAIN: You remember back in 1982 when Phil Gramm—Phil Gramm and Warren Rudman and Gramm-Latta and all of those people got the first real tax cuts done, the real—first real restraints in taxes. I was there. You were there. And I rely on those people to a much larger degree than any, quote, "formal" organization, although the secretary of Treasury is obviously one of the key and important posts that I would have.

Instead of answering Paul's question, McCain gave a general question about whom his economic advisers might be rather that how he would coordinate with the Treasury, the Fed, and Wall Street during crises, such as last August's credit meltdown or the recent market selloff.