White House hopeful John McCain pitched a $300 billion plan to help struggling homeowners today, as he sought to dent a lead Barack Obama has built over his handling of economic issues.
The morning after a sometimes tense second presidential debate, the ailing economy once again took centre stage in the White House contest, even as a cut in global interest rates failed to stop the continuing tumult on Wall Street.
Two snap polls judged Obama the winner of the Nashville, Tennessee, debate on Tuesday night. That suggested that McCain, a Republican, could be running out of chances to recast the November 4th race, which has been trending toward his Democratic opponent.
McCain today offered more details on a plan he suggested in Nashville to have the government to buy up troubled loans from homeowners who have seen values fall below their debt. The loans would then be structured into more affordable mortgages.
"Under my orders as president, the secretary of the Treasury will carry out a home ownership resurgence plan," McCain told a rally in Bethlehem, Pennsylvania. "The dream of owning a home should not be crushed under the weight of bad mortgages."
The Arizona senator called the plan a "a critical first step our country must take to get through this time of crisis."
But the Obama campaign dismissed the idea "more costly and out-of-touch than we ever imagined" and noted that the Treasury already has authority under a $700 billion rescue plan approved by Congress to buy up distressed debt.
"John McCain wants the government to massively overpay for mortgages in a plan that would guarantee taxpayers lose money, and put them at risk of losing even more if home values don't recover," Obama campaign economic policy director Jason Furman said.
Mr Obama, an Illinois senator, has sought to portray Mr McCain as an erratic leader in the financial crisis. Democrats sharply criticised McCain last month when he offered to suspend his campaign to try to help lawmakers reach a deal on the bailout package.
Mr McCain's critics suggested his move hindered, rather than helped, the talks.
"This is a time for resolve and steady leadership," Mr Obama told an outdoor rally at a mud-soaked fairgrounds in Indianapolis.
Mr Obama also accused McCain of offering the policies of President George W. Bush "that led us into this mess in the first place."
But Mr McCain's running mate, Sarah Palin, said r Obama's efforts to tie Mr McCain to Mr Bush were "starting to wear pretty darn thin."
Polls show voters favour Mr Obama on economic issues, giving him a lead between four and nine percentage points in national surveys released in the past few days.
Both candidates applauded the US Federal Reserve's cut of a key lending rate by a half percentage point in a coordinated effort with central banks around the world.
Reuters