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Obama, McCain Duel Over Market Turmoil

GOLDEN, Colo. – The presidential nominees escalated their fight Tuesday to gain an edge in light of the economic downturn, as John McCain called for the creation of a commission to probe the financial market crisis and Barack Obama rejected the proposal as an attempt to “pass the buck.”

It was the second consecutive day that the campaigns sparred almost entirely over the economy, racheting up the pressure on McCain and Obama, neither of whom has established dominance of the issue, to gain the upper hand on a top concern for voters.

There were sideshows, of course, but even those dealt with the economy.

The Obama campaign blasted out comments from top McCain economic adviser Carly Fiorina who said Tuesday that neither McCain nor his running mate is qualified to lead a large corporation. (She said the same about the Democratic candidates.)

And in one of the Republican nominee's numerous populist statements Tuesday, McCain criticized Obama for flying to Beverly Hills for two big money fundraisers, including one featuring entertainer Barbra Streisand.

“He talks about siding with the people – siding with the people – just before he flew off to Hollywood for a fundraiser with Barbra Streisand and his celebrity friends,” McCain said at a rally in Vienna, Ohio. “Let me tell you, my friends: There's no place I would rather be than here with the working men and woman of Ohio.”

Obama chief strategist David Axelrod scoffed at the attack, saying “their efforts to deflect attention … are just going to fail.”

“I don’t know who showed up down in Florida where he raised $5 million,” Axelrod said, referring to a Monday event, “but my guess is that it wasn’t a lot of nurses, firefighters and police officers.”

The day started on a substantive note.

By the time Obama woke up in this swing state, McCain had already stepped out with a specific response to the economic upheaval. Appearing on morning news programs, McCain proposed a panel similar to one that investigated the Sept. 11 terrorist attacks to probe what caused the crisis and how it can be prevented in the future. 

“We need a 9/11 commission," McCain said. “We need a commission to figure out what went wrong and how to fix it and I know we can do that and I'll do it.”

Within hours, Obama had dismissed the commission as the “oldest Washington stunt in the book.”

In a speech in Jefferson County, a critical swing county, Obama reissued a six-point plan, which he first outlined in March, to tighten government regulation of financial institutions. The Democratic nominee also repeatedly sought to link McCain with conservative economic policies that Obama blamed for the turmoil.

“This was not the invisible hand of the market at work,” Obama said in a speech here. “These cycles of bubble and bust were symptoms of the ideology that my opponent is running to continue. John McCain has spent decades in Washington supporting financial institutions instead of their customers.”

The bankruptcy of Lehman Brothers and the sale of Merrill Lynch, followed Monday by a 504-point drop in the Dow Jones Industrial Average, were “nothing less than the final verdict on an economic philosophy that has completely failed,” Obama said.

"Make no mistake: my opponent is running for four more years of policies that will throw the economy further out of balance," Obama said, citing McCain's tax cuts. "His newfound support for regulation bears no resemblance to his scornful attitude towards oversight and enforcement. John McCain cannot be trusted to re-establish proper oversight of our financial markets for one simple reason: he has shown time and again that he does not believe in it."

Campaigning in Florida, McCain avoided repeating his statement from Monday that the “fundamentals o our economy are strong” – a claim that the Obama campaign turned into a TV ad Tuesday – and instead emphasized that he believed Wall Street was in “crisis.”

McCain blamed corporate corruption, CEO greed and lax government oversight for putting American workers at risk.

“Too many people on Wall Street have been recklessly wagering instead of making the sound investments we expected of them,” McCain said. “And when their companies collapse, only the CEO's seem to escape the consequences. While employees, shareholders, and other victims are left with nothing but trouble and debt, the people who helped cause the collapse make off with tens of millions in severance packages.”

McCain repeated his populist indictment of Wall Street executives before a blue collar crowd in Vienna, Ohio, later Tuesday, including many seniors fretting over their pensions.

Re-uniting with his running mate Sarah Palin, McCain offered populist fodder to about 5,000 people who were jammed into and spilling out of an airplane hangar in Ohio’s industrial Mahoning Valley.

The visit to Vienna – and McCain’s language there – reflects the Arizona senator’s determination to pick up the sort of lunchbucket Democrats who overwhelmingly favored Hillary Clinton in the Democratic primary. 

Trumbull County, where Vienna is located, went 62-38% for John F. Kerry in 2004, but McCain aides believe they can do better because of a perceived cultural gap between Obama and the type of pro-gun Democrats who dominate the party here.

Playing directly at this angle, Palin used her introduction to recall Obama’s comments earlier this year about rural voters clinging to guns and religion. The crowd, which included some sporting NRA hats, roared its approval.

The differences between McCain and Obama on their approach to the crisis became only bit more clear Tuesday.
McCain’s remarks focused on encouraging transparency, fighting speculation, and hinted at consolidating regulatory agencies along the lines that Treasury Secretary Hank Paulson has proposed.

The Republican nominee essentially blamed the regulatory agencies – not the administration – for failing their mission.

“And there are so many of those regulators that the responsibility for oversight is scattered, unfocused and ineffective,” McCain said. “Among others, we've got the SEC, the CFTC, the FDIC, the SIPC and the OCC. But for all their big and impressive sounding names, the fact is they haven't been doing their job right, or else we wouldn't have these massive problems on Wall Street.”

Obama offered an indictment of deregulation and conservative economic policies. Like McCain, he advocated transparency and anti-manipulation measures, but he also called for increased oversight and capital requirements for investment banks.

Jonathan Martin and Avi Zenilman contributed to this story.