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Obama, McCain focus on US economy

US Democratic presidential candidate Senator Barack Obama talks with Sam Agolino, right, while having pie at the Avenue Diner in Wyoming, Pennsylvania, on Friday. PHOTO: AFP

Democrat presidential nominee Senator Barack Obama ridiculed Republican rival Senator John McCain and his running mate for claiming they would bring about the changes needed to get the country back on the right track.

Obama’s comments on Saturday came as both campaigns scrambled to react to the implications for taxpayers and the economy of a reportedly impending government takeover of mortgage giants Fannie Mae and Freddie Mac.

A day earlier the government reported that the US jobless rate hit a surprising 6.1 percent last month.

The latest economic setbacks only underscored how large a factor the troubled US economy has become in the presidential campaign, mostly eclipsing the Iraq War as voters worry about losing their jobs, homes and health insurance coverage.

Speaking to 800 people in a barn at a Terre Haute, Indiana, fairgrounds, Obama said people should not believe the claims by McCain and his vice presidential pick, Alaskan Governor Sarah Palin, that they were the agents of change ready to shake up business as usual.

“Don’t be fooled,” Obama said of the campaign’s comments at the Republican National Convention last week. “John McCain’s party, with the help of John McCain, has been in charge” for nearly eight years.

Obama and McCain said they were both briefed by US Treasury Secretary Henry Paulson on the mortgage crisis and the administration of US President George W. Bush’s steps toward a government takeover of the two financial companies, which together hold or back half of US mortgage debt.

News of a government takeover on Friday followed a report by the Mortgage Bankers Association that more than 4 million US homeowners with a mortgage, a record 9 percent, were either behind on their payments or in foreclosure at the end of June.

“Any action we take must be focused not on the whims of lobbyists and special interests worried about their bonuses and hourly fees, but on whether it will strengthen our economy and help struggling homeowners,” Obama told reporters after a campaign stop in Indiana.

He stopped short of making detailed proposals, saying “we need to carefully address” the possible impact on community and regional banks.

A government bailout could cost taxpayers around US$25 billion, the Congressional Budget Office said.

McCain and Palin addressed the crisis briefly at a rally in Colorado Springs, Colorado.

Palin said that the two financial companies have “gotten too big and too expensive to the taxpayers.”

“The McCain-Palin administration will make them smaller and smarter and more effective for homeowners who need help,” she said.

McCain said in an interview for CBS television’s Face The Nation scheduled to air yesterday that the mortgage giants needed to be restructured, saying they are “the classic example of why we need change in Washington” and reflect “the kind of cronyism, corruption, that’s made people so justifiably angry.”

McCain and Palin attracted thousands to the rally in Colorado Springs, a city that is home to many Christian conservatives and military families. They were to head later to New Mexico, trying to blunt Obama from making gains in Western states that went Republican in the 2004 election.

In the short time since McCain spirited the little known 44-year-old first-term governor out of Alaska and onto a national stage as his running mate, Palin has become an instant celebrity who has energized the party’s conservative base. At the Colorado rally thousands of supporters changed “Sa-rah! Pa-lin!” before McCain took the stage with her.

The McCain campaign was planning to keep Palin with McCain for several more days, rather than dispatch her to campaign by herself, keeping her out of the reach of reporters who might subject her to tough questions about her record in Alaska, including an ongoing ethics investigation into her firing of the state’s public safety commissioner.

At the convention, McCain, who has served 22 years in the Senate, tried to frame himself as a political outsider and maverick, borrowing the same message of change that Obama has made the centerpiece of his run for the White House.
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