Obama, McCain clash over causes, cures of financial crisis


NASHVILLE, Tennessee — Democrat Barack Obama and Republican John McCain clashed repeatedly over the causes and cures for the worst economic crisis in 80 years and the Iraq war Tuesday night in their critical second presidential debate.

Both candidates shied away from the rancor and character attacks of the days leading up to the face-off.

The crumbling U.S. financial system dominated the face-off, as McCain fought to stem his slippage in the polls. That apparently prompted him to propose a striking $300 billion program for the federal government to buy up bad home mortgages and allow homeowners to keep their houses.

McCain said: “Until we stabilize home values in America, we’re never going to start turning around and creating jobs and fixing our economy, and we’ve got to get some trust and confidence back to America.”

McCain said he would direct the federal government to buy mortgages directly from homeowners and mortgage providers. The loans would be replaced with fixed-rate mortgages, ostensibly at a loss to the government.

McCain also said America’s troubled economy would require the government to scale back benefits now enjoyed by older Americans, and both men agreed that U.S. government entitlement programs – social security retirement payments and medical insurance for the elderly – had to be overhauled.

Neither candidate offered new proposals on the Iraq war, which McCain supports and Obama has opposed from its inception.

The 72-year-old four-term Arizona senator said Obama would bring U.S. troops home from Iraq in defeat. Obama, a 47-year-old first-term senator from Illinois, said the war was draining the U.S. Treasury of $10 billion a month, money that was needed to put a floor under the country’s failing financial system.

In one pointed confrontation on foreign policy, Obama bluntly challenged McCain’s steadiness. “This is a guy who sang bomb, bomb, bomb Iran, who called for the annihilation of North Korea – that I don’t think is an example of speaking softly.”

That came after McCain accused him of foolishly threatening to invade Pakistan and said, “I’m not going to telegraph my punches, which is what Sen. Obama did.”

While standing back from angry confrontations that were presaged by the vitriol-laced days immediately before the debate, McCain did quip at one point that trying to pin down Obama’s tax plan was like “trying to nail Jell-O (gelatin) to the wall.”

Obama shot back, “Sen. McCain, I think the Straight-Talk Express lost a wheel on that one,” referring to the name McCain has applied to his campaign bus and jet.

They were generally polite, but the strain of the campaign showed. At one point, McCain referred to Obama as “that one,” rather than speaking his name.