What did Truman mean when he claimed that McCarthy was an "asset" to the Kremlin?

At a press conference in Key West on March 30, 1950, President Truman said that "I think the greatest asset that the Kremlin has is Senator McCarthy." When asked to elaborate what he meant by that, the President deflected the question. However, it is possible to infer what Truman meant by this statement.
Senator McCarthy had recently made the unsupported accusation that the State Department was harboring as many as two hundred communists. By sowing doubt and suspicion about the loyalties of important government officials in the federal government, McCarthy was weakening the effectiveness of the diplomatic instruments necessary to counter the threats of the Soviet Union.
Truman had every bit of faith and confidence in the State Department and in Secretary of State Dean Acheson. He saw Republican McCarthy's attacks as a form of political mudslinging aimed at his Democratic administration. By using the backdrop of the Cold War to score political points in this way, Truman felt that McCarthy was weakening the strength of the United States government as a symbol of a functional democracy. As such, the Soviet Union might be able to point to this dysfunction as a sign that liberal democracies are not as strong as they claim to be.

He meant that McCarthy's controversial behavior was a propaganda gift to the Soviet Union. Senator McCarthy had been conducting a campaign against alleged Communist infiltration in the institutions of US government and the military. The methods he used were highly controversial. In many cases, McCarthy had no evidence whatsoever that the people he accused really were Communists or even in the least bit sympathetic towards Communists. The hearings of his notorious Senate subcommittee proceeded on the basis of smear, innuendo, hearsay, and in some cases, outright fabrication.
To many, including President Truman, McCarthy was undermining the traditions of American liberty and democracy. In doing so, he was damaging the United States' reputation abroad. More seriously, McCarthy's actions would allow the Soviets to claim that the United States' self-image as a beacon of freedom was nothing more than a sham. McCarthy's anti-Communist witch hunt could also be used by the Soviets as a convenient excuse to accuse the Americans of hypocrisy whenever they attacked the USSR over its deplorable record on democracy and human rights.