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Straight Talk with Sen. John McCain Uncut and 'On the Record'

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This is a rush transcript from "On the Record," February 3, 2010. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Tonight, Senator John McCain uncut and "On the Record."

(BEGIN VIDEOTAPE)

VAN SUSTEREN: Senator, nice to see you, sir.

SEN. JOHN MCCAIN, R - ARIZ.: Thank you, Greta. Thanks for having me back.

VAN SUSTEREN: Thank you for letting us come to your office. You had some tough words for the attorney general of the United States, Eric Holder. You said he botched the arrest of the underwear bomber in Michigan. In light of the fact that we hear he is talking, change your mind or not?

MCCAIN: Well, first of all, we need more details on that, but intelligence has got a very short shelf life. And as rapidly as you can get the information, the more rapidly you can react, particularly since the enemy knows you have that individual in your hands.

But fundamentally -- fundamentally -- we should never have had this guy in that situation. We should have had him in a military tribunal, not a civilian court. A military tribunal is what terrorists are supposed to be put into. And we need to -- one, clarification, and two, to tell the American people there'll never be a situation where someone who tries to commit a terrorist act on the United States of America would ever have access to Miranda rights and will be interrogated to try to get whatever information we can get to save American lives.

VAN SUSTEREN: Well, it seems to me you have two choices in this situation. Either you can try him as a civilian or charge him as a civilian upon -- or, you know, when you get your hands on him, or you can consider him an enemy combatant. If you charge him as a civilian and he gets Miranda rights, I don't think we can back up. If you treat him as an enemy combatant and you decide later to charge him as a civilian, I think that's probably constitutional.

Is the problem that the sort of the hair trigger was to charge him criminally and not to sort of consider enemy combatant, or don't you think they even thought that?

MCCAIN: There should have been no consideration to give this person the rights that American citizens have -- Miranda rights, the rights to a civil trial. He is an enemy combatant. An enemy combatant should be placed under the jurisdiction of the military and should be tried by a military commission. We should make that absolutely clear!

VAN SUSTEREN: Do you think they want a -- they'd like a do-over on that, or do you think that the next time -- I guess the American people wonder, OK, the next time -- we hope there isn't a next time, but the next time this happens, do you have a sense from this White House, this attorney general, that he will be treated as an enemy combatant, not civilian and get Miranda rights right away, or is this still up in the air? Or is that still the way they approach it?

MCCAIN: We need clarification. We need clarification. And I would also remind you of the process. None of the three heads of our intelligence agencies -- Homeland Security, DNI or Counterterrorism -- were ever asked or consulted before they decided to give this Christmas bomber the Miranda rights.

VAN SUSTEREN: Why not? Why wasn't anybody called?

MCCAIN: We have no answer to that question.

VAN SUSTEREN: So it was just a single decision made by, presumably, the attorney general.

MCCAIN: Well, they said it was the attorney general in consultation with lower-level FBI. There's many things that are coming out about this story. Supposedly, they have a group that's formed up that is supposed to be tailored to interrogate these suspects. Well, number one, that never happened. But number two, we now hear that that has -- is still not in being. The HIG, as they call it, high intelligence group or -- interrogator group, something like that -- a group of qualified individuals who are supposed to be dispatched when one of these individuals is apprehended to do the interrogation. That group not only wasn't there, but apparently, they haven't been formed up yet and it's been a number of months.

Watch Greta's interview with Sen. McCain: Part 1 | Part 2

VAN SUSTEREN: You know, it's sort of interesting that -- sort of the late night comedy about the underwear bomber and he came and blew himself - - all the jokes. But setting the jokes aside, you know, We really got lucky because had that bomb gone off, there would have been over 250 people murdered. I mean, we really got lucky on that one.

MCCAIN: I think we got lucky. And I also think that it's interesting that Usama bin Laden claimed credit for it, and there appears to be ties that this individual had to al Qaeda. We don't need to go through all the fact that his father went to the embassy, that he showed up on a one-way ticket, that -- all of the things that should have connected the dots -- a phrase I hate, by the way. But we should have. It never should have reached that point. And thank God for some brave people who were on that airplane.

VAN SUSTEREN: Well, even (INAUDIBLE) it's almost to the point of delusional, with all those red flags, that -- you know, that we didn't -- you know, we got so lucky on that one. Real lucky.

MCCAIN: We certainly did.

VAN SUSTEREN: "Don't Ask, Don't Tell." You are still in favor of that policy in light of what Secretary of Defense Gates and Admiral Mullen said, or you think that things have now evolved and you're in favor of gays serving openly in the military?

MCCAIN: Well, first of all, I think -- I know that it's working. I spend a lot of time with the military. It's working. Second of all, this decision was made by the president, not by the military, who have their hands full in two wars. Third of all, I respect the views of Admiral Mullen, who said it was his individual opinion, that we have not heard from the rest of the military leadership. And I'd be very interested in hearing from our military on this issue.

And finally, I have a letter signed by over a thousand retired admirals and generals, over a thousand, thousands of years of experience, that say, Don't repeal "Don't ask, don't tell" because it could have an impact on our combat effectiveness. So they're going to, I hope, do a study. I hope we're going to get the opinion from our military leadership. And I have always said that I believe that "Don't ask, don't tell" was working, and I believe it is.

VAN SUSTEREN: In terms of the letter, how dated is it? Because I think that what some of the leaders have said is that, you know, that was then but that things have evolved, people's views. Is your letter, you know, in the last year or two? Is it -- how current is the letter?

MCCAIN: The current was -- the letter is as, I believe, October of last year.

VAN SUSTEREN: All right. What is it that you think -- if they serve openly, what is it, the sort of effect it would have? I mean, tell me -- play it out for me. What happens?

MCCAIN: Well, as you know, in combat, our members of the military live very close together. We are not prohibiting people who are that orientation that is homosexual or lesbian -- we are not prohibiting them from serving. We are just saying that we do not talk about the fact -- in other words, that's what "Don't ask," and we don't ask.

So I think, again, when I talk to men and women in the military, they say it's not broke, it's not broken, so we don't need to fix it. But again, I will be very interested in hearing the views of our military leaders, particularly our Marine Corps, as well as Army, as well as Air Force, as to what they think that this policy needs to -- whether it needs to be changed or not.

But my view now is that it is working. And we are in two wars and we need to have an assessment of the combat effectiveness and morale of our military if -- and that effect would be if we change the policy.

VAN SUSTEREN: Admiral Mullen said it's his personal view. Secretary Gates is speaking on behalf of the president. In the event that after a full study -- I think Secretary Gates called for a study. You know, let's say that six months down the road or a year down the road, that they conclude from the military leaders in theater who are fighting these wars - - they say that, you know, we can get away -- we can do away with "Don't ask, don't tell," would you then be in favor of doing it? Because it's a decision made here, not at the White House, right?

MCCAIN: Yes. We will have a number of hearings. We had many hearings back when -- before the policy of "Don't ask, don't tell" was adopted. We will have many hearings, be able to hear from our military leaders. And I believe that the system -- present policy is working. If they can show me the evidence that it needs to be changed, obviously, then I would give that serious consideration. That has been my consistent policy. But I do believe that the policy in effect today is working.

VAN SUSTEREN: The economy -- you got a big, fat suggested budget dropped on your doorstep here on Capitol Hill. What's your thought on the president's budget and the effect on the deficit, and what are you going to do with it?

MCCAIN: Well, I think it's horrific. I think that this incredible deficit and debt is going to -- is an act of generational theft that is unconscionable. And you know, somebody said the other day, you can't remain a world power if you owe the rest of the world such huge trillions of dollars of debt. I mean, and no country, no family, no business can continue to function if you have an ongoing debt and deficit of the magnitude we have.

And for the president to say we're going to having a spending freeze next year, which could be $15 billion in savings, and immediately turn around and say, But we need $100 billion jobs, i.e. stimulus, bill, they haven't learned anything. They haven't learned anything. And the deficits as percent of GDP size in every measurement are beyond anything that can be sustained for a long period of time.

VAN SUSTEREN: Is it -- all right, is one of the considerations -- I mean, obviously, one with this is standard of living and people's ability to hold jobs and build futures for their family. Is one consideration if the United States gets too far in debt with, for instance, china, that we sort of lose our authority in the world, that we look weak? Is that a consideration to you or not?

MCCAIN: If you continue to owe this amount of money, then you're not going to be able to pay it back. So then what happens? You debase the currency and so you can pay these debts back. Then you get inflation. Inflation is the greatest enemy of the middle class.

But also, fundamentally, we shouldn't owe all this money to foreign countries. Even though they wouldn't want to do it, particularly the Chinese, but they now have their hand on the throttle of the world's economy and our economy. And that's -- that is -- that is a terrible situation for America to find itself in.

And by the way, it didn't start with the Obama administration. The spending was out of control under the Bush administration. But the magnitude in just one year of the spending increases is unbelievable.

(END VIDEOTAPE)

VAN SUSTEREN: Next, more with Senator McCain. Majority Leader Reid called Senator McCain a sore loser and accuses Senator McCain of being a name caller. Well, we asked Senator McCain about Senator Reid. And well, stick around and see what Senator McCain has to say about Senator Reid. That's next.

(COMMERCIAL BREAK)

VAN SUSTEREN: Continuing with Senator John McCain.

(BEGIN VIDEOTAPE)

VAN SUSTEREN: I know that the numbers we hear are in the trillions, so that now billions don't seem like much. But even millions are beginning not to seem like much. But I'm sort of curious, and I read coming over here that the United States has purchased an ad on the Super Bowl, $2.5 million, to advertise the census. I'm thinking, $2.5 million for 30 seconds. Frankly, I know how I feel, but I'm curious -- I know it's not a whole lot, but are you in favor of it or against that one?

MCCAIN: I don't think it's necessary, but it's symptomatic of the spending practices of the federal government and the Congress in a way that is completely out of touch with what's going on out there in the real world. In the city of Phoenix and across my home state of Arizona, 48 percent of the home mortgages are underwater. In other words, they're worth less than the payments people are making -- 17 percent real unemployment. And so we spend a couple million dollars on irritable bowel syndrome and we spend a couple of million dollars on an ad in the Super Bowl Sunday, and we continue the practices that infuriate our citizenry because they're hurting so badly. They're having to tighten their belts.

This is -- this is what feeds the tea parties. This is what feeds the anti-incumbency mood that's out there, an out-of-touch Congress and an out- of-touch administration.

VAN SUSTEREN: When you mention the sort of out of touch -- President Obama said to the Democrats today that they need to stop paying attention to cable news. And we didn't get singled out particularly this time.

MCCAIN: I don't know who they were referring to.

VAN SUSTEREN: Well, actually, they were referring -- I think he actually said CNN and Fox News. But he said that they needed to go out and pay attention to their constituents. Is this president paying attention to his constituents? Are the members of the House, both parties, paying attention to constituents or not?

MCCAIN: Well, first of all, I advise my friends to go ahead and watch the cable news because our constituents are. Listen, I'll walk down the street...

VAN SUSTEREN: I'll take that plug.

MCCAIN: Yes. Listen, I'll walk done the street in Phoenix, and they'll say, I saw you on Greta, you know?

VAN SUSTEREN: I'll take that plug!

MCCAIN: And they may say, Lousy job.

(LAUGHTER)

MCCAIN: But they'll say, I saw you on Greta. People watch, and people get a lot of their news and information and opinion from cable news. So I would advise members of Congress just the opposite because you want to know what information that your constituents are getting.

Second of all, it's always the way that we have politicians do, in all due respect, shoot the messenger -- shoot the messenger, don't worry about the message. And the message is that we're hearing is they're sick and tired of business as usual.

Some polls have the approval rating of Congress in single digits, and that -- you get down to blood relatives and paid staffers. And so you -- you know, we're -- the message I think may come in this November, and it might be the most interesting political election that you and I have seen.

VAN SUSTEREN: Speaking of elections, and one of your colleagues, Senate Majority Leader Harry Reid has been -- he has had some things to say you about you on a Las Vegas talk show. Here's the litany. He accuses you of playing petty politics, being stuck in the 2008 campaign, refusing to do good things for the country. He says you're a great name caller. And he says you should leave President Barack Obama alone.

What's going on between you guys?

MCCAIN: I'm very appreciative of all the attention that Senator Reid gives me. I'm fascinated he hardly passes up an opportunity to mention my name, and maybe I'll run in Nevada if...

VAN SUSTEREN: What's going on? What -- I mean, like -- I mean, it's -- that -- it's, like, the level of vitriol seems to be cranked up a little bit in this.

MCCAIN: I don't quite understand it, but despite what Senator Reid says, I'm fighting every day for the people of Arizona and the things that I believe in. And if anybody says that I'm still dwelling on the last campaign, they don't know me. The best thing I've done is move forward and work hard, and Americans and my fellow citizens of the state of Arizona need me more than ever.

VAN SUSTEREN: In terms of name calling, you got a name for him? It might be a good name for him. He said you're a name caller.

(LAUGHTER)

MCCAIN: The Majority Leader...

(LAUGHTER)

MCCAIN: Who may not be in that position next January. Maybe. We'll see. It's -- this is going to be -- these are exciting and interesting times. And so I just -- look, I just go ahead and do my job.

VAN SUSTEREN: Senator, thank you, sir.

MCCAIN: Thank you.

(END VIDEOTAPE)

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