A delicate embrace

McCain, Obama both seek to take at least partial credit for outcome of the financial bailout plan

Associated Press

September 29, 2008

WASHINGTON - Democrat Barack Obama and Republican John McCain have gingerly embraced a newly negotiated congressional deal for a $700 billion bailout of the hobbled financial industry.

"This is something that all of us will swallow hard and go forward with. The option of doing nothing is simply not an acceptable option," McCain said yesterday. Obama said he was inclined to back it "because I think Main Street is now at stake."

True to form after a week of posturing, both campaigns sought to take at least partial credit for the outcome. Obama said McCain did not deserve any pats on the back.

"Here are the facts: For two weeks I was on the phone every day with [Treasury Secretary Henry M. Paulson Jr.] and the congressional leaders making sure that the principles that have been ultimately adopted were incorporated in the bill," Obama said in an interview on CBS' Face the Nation.

McCain said the latest version of the plan meets his insistence of an oversight body to monitor the Treasury secretary and limits the compensation of executives of financial institutions applying for loans.

"Let's get this deal done, signed by the president, and get moving, because the real effect of this is going to restore some confidence, and get some credit out there, and get the economic system moving again, which is basically in gridlock today," McCain told ABC's This Week.

The measure would allow the government to buy defaulted mortgages and other distressed housing-related assets, many of them held by Wall Street banks, in an effort to keep the worst financial crisis since the Great Depression from spreading throughout the entire economy.

Obama predicted quick passage of the measure, which he said contained important consumer-friendly provisions he had supported. "Today, thanks to the hard work of Democrats and Republicans, it looks like we have a rescue plan that includes these taxpayer protections," Obama said in remarks prepared for a Detroit rally. "And it looks like we will pass that plan very soon."

On Wednesday, McCain announced that he was "suspending" his campaign to return to Washington to help negotiate terms of a bailout agreement. He initially suggested that Friday's presidential debate be postponed if no deal was struck. But his campaign ads continued to air, and McCain attended the debate even though there was no deal.

While McCain is not on a Senate committee involved with the financial crisis, he said he rushed back to Washington yesterday because he was not going to "phone in" his advice.

"I'm a Teddy Roosevelt Republican. I've got to get in the arena when America needs it," McCain said.

Republicans generally have said his participation helped prod the agreement. Democrats countered that his presence had little effect on the outcome and might have even delayed a deal.

"Whether I helped or hurt, I'll be glad to accept the judgment of history," McCain said.

McCain said he planned to return to full-time campaigning today.

He also said he probably would have voted for legislation to keep the government running even though it contained thousands of the type of pork barrel projects he strongly opposes.

The $634 billion measure passed the Senate on Saturday. It also includes $25 billion in taxpayer-subsidized loans for automakers.

Like McCain, Obama spent parts of several days in Washington because of the bailout talks. But he has returned to the trail, and yesterday he and running mate Joe Biden planned to attend a rally in Detroit, the home of the nation's auto industry. Michigan is a key battleground state in November.

Obama said in his television interview that he was inclined to support the bailout because it includes increased oversight, relief for homeowners facing foreclosure and limits on executive compensation for chief executives of firms that receive government help.