This is very interesting. McCain is apparently trying to attack Obama for supporting the bailout and to out-Main Street him with his mortgage proposal sold in highly populist terms. Since no one likes the Paulson plan, this might be good politics in theory, but is going to be hard to pull off given McCain’s own support for the Paulson plan. From the McCain campaign (they sent this out yesterday evening, by the way — I tried to post on it last night, but my post disappeared into the ether for some reason):
Please see the following statement from McCain Senior Economic Adviser Doug Holtz-Eakin in response to Senator Barack Obama’s opposition to John McCain’s American Homeownership Resurgence Plan. John McCain’s plan calls for a greater portion of the recently passed legislative rescue plan to be designated directly to aid struggling homeowners:
“By opposing John McCain’s effort to help Americans stay in their homes, it is clear that Barack Obama would rather support a bailout of Wall Street than rescue Main Street America. Unlike Barack Obama, John McCain doesn’t believe that working to keep Americans in their homes is ‘too costly’ and ‘out of touch.’ From his campaign’s comments, it is clear that Barack Obama would rather see the taxpayers’ money go to corrupt Wall Street firms like AIG than keeping Americans in their homes. If Barack Obama wants to defend using the taxpayers’ money to prop up Wall Street instead of keeping people in their homes and providing jobs on Main Street, John McCain is happy to have that debate. Barack Obama says he wants to protect taxpayers but apparently that does not include protecting their homes.” – Doug Holtz-Eakin, McCain-Palin 2008 Senior Policy Adviser
In A Statement From The Obama Campaign, Economic Policy Director Jason Furman Calls John McCain’s Plan To Help Keep Americans In Their Homes “Out-Of-Touch” And Too “Costly.” “Senator McCain’s first response to this economic crisis was to say that the fundamentals of our economy are strong. Since then, he’s acknowledged that there is a crisis and offered multiple plans, sometimes conflicting. Last night, in his latest attempt to get it right, he threw out a proposal that appeared to give the Treasury authority it already has to re-structure troubled mortgages. But now that he’s finally released the details of his plan, it turns out it’s even more costly and out-of-touch than we ever imagined. 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. The biggest beneficiaries of this plan will be the same financial institutions that got us into this mess, some of whom even committed fraud.” (Ben Smith, “Obama Will Oppose McCain Mortgage Plan,” Politico, 10/8/08)