The Note: Fundamentally Unsound

NIAGARA FALLS, N.Y. -- When it comes to the fundamentals, there's nothing like a full-blown economic crisis to make things very serious very fast in the race.

When it comes to the fundamentals, there's a very real opening for a candidate to jump through with an economic message that connects.

And when it comes to the fundamentals, Sen. John McCain widened that opening for his rival Monday when he said, again -- on a day of economic turmoil nearing panic on Wall Street and far beyond -- that the "fundamentals of our economy are strong."

Seven weeks out from Election Day, Team McCain is about to learn that some things even Gov. Sarah Palin can't make better.

(And as Palin's credibility takes a hit -- there are some things that even a stretch in the gubernatorial tanning bed can't make sunny -- could the Palin phenom be cresting?)

McCain, R-Ariz., did damage control Monday and into the Tuesday morning shows. Seems that whole fundamentally strong economy thing was a misinterpretation. Not only is it not fundamentally strong, but apparently the economy needs a 9/11 Commission.

"I said the fundamental of our economy is the American worker. I know that the American worker is the strongest, the best, and most productive and most innovative. They've been betrayed by a casino on Wall Street of greedy, corrupt excess -- corruption and excess that has damaged them and their futures," he said on GMA.

"And we're going to fix and make sure that every American who has a deposit in a bank, that their deposit is ensured. We're going to need a 9/11 commission to find out what happened and what needs to be fixed. I warned two years ago that this situation was deteriorating and unacceptable. And the old-boy network and the corruption in Washington is directly involved, and one of the causes of this financial crisis that we're in today. And I know how to fix it, and I know how to get things done."

But much of the damage is done:

"We know you meant what you said the first time because you've said it before," Obama said Monday night in Pueblo, Colo., per ABC's Jake Tapper. "I think it's good that Sen. McCain is celebrating the American worker today. But it would have been nice if some time over the last 26 years he stood up for them once in a while!"

Given a Democrat's built-in advantage on all things economic this year, the pieces are in place for Sen. Barack Obama to regain the momentum by tying it all together on a big issue -- something that suddenly matters here in Upstate New York just as urgently as it does in Lower Manhattan.

Does it all add up to a (Palin) buzz-kill? Or will it be another in a line of missed opportunities?

Obama, D-Ill., turns an ad in a hurry -- featuring McCain's fateful quote no less than three times. "How can John McCain fix our economy," the new spot asks, "if he doesn't understand it's broken?"

Sen. Hillary Rodham Clinton sees Obama jumping at the right time: "He's doing it -- he's talking about the economy, he's talking about what's at stake in this election," Clinton, D-N.Y., told ABC's Diane Sawyer aboard the "Good Morning America" "Whistle-Stop Express" in Albany.

(Asked whether "part of you [will] be cheering" for Palin to succeed, Clinton chided her former supporters who are now backing McCain-Palin. "So many people are missing the boat here," Clinton said. "I don't think that it's inconsistent for a lot people to say, 'Well hey, that's exciting, what an exciting pick,' and still say, 'But that's not the ticket for me and my family.' ")

(And Clinton responds to Palin's assertion that Obama probably regrets not choosing her: "I'm very happy going out campaigning as hard as I can for both Barack and Joe.")

Tapping into economic frustrations is -- and by rights should be -- Obama's wheelhouse, if only by default.

"That's the way it is: Your party occupies the White House, you take some of the hit when bad things happen, particularly when it appears those bad things have been taking shape for years," Gerald Seib writes in his Wall Street Journal column.

"Bad day for this kind of a gaffe," Phil Singer blogs. "This one is going to have legs."

"Over the weekend, the moneyed class became much more vulnerable," columnist E.J. Dionne Jr. writes. "All of a sudden, the culture war seems entirely beside the point, an unaffordable luxury in a time of economic turmoil."

"Barack Obama on Monday sought to use the Wall Street crisis to force a shift in presidential campaign dynamics, hoping to move the fight onto economic terrain potentially friendlier to a Democrat and also create a break in the public's fascination over John McCain's running mate," John McCormick and Jill Zuckman write in the Chicago Tribune.

The Washington Post's Dan Balz and Robert Barnes: "McCain faces the bigger challenge. As the Republican nominee, he must answer for what has happened on President Bush's watch and offer a plausible explanation for why his conservative administration would be genuinely different. Obama already is attacking him as ill-equipped to deal with the financial crisis and has aggressively moved to tie a future McCain administration to a lobbyist-dominated Washington culture."

"His record on the issue, and the views of those he has always cited as his most influential advisers, suggest that he has never departed in any major way from his party's embrace of deregulation and relying more on market forces than on the government to exert discipline," Jackie Calmes writes in The New York Times. "He has consistently characterized himself as fundamentally a deregulator and he has no history prior to the presidential campaign of advocating steps to tighten standards on investment firms."

"I am fundamentally a deregulator," McCain said last March (and there's that word again).

"The economy is in crisis," McCain declares in an ad now on the air -- seemingly disputing himself.

For Obama, it fits into a larger theme: "After a string of tactical successes by McCain and his running mate, Alaska Gov. Sarah Palin, over the past two weeks, the Obama campaign sought to regain its footing on Monday. The shift followed a series of internal meetings, including a rare Sunday evening session at the campaign's Chicago headquarters that Obama attended," Anne Kornblut and Shailagh Murray report in The Washington Post.

"Advisers reinforced the division of labor in the days ahead: Obama will articulate the campaign's broader message of 'change' and outline how the Democratic ticket will govern, while Biden will deliver attacks against the GOP ticket, drawing on his 30-year-old relationship with McCain to undercut the Arizona senator's standing, especially among working-class voters," they report.

"Obama's renewed emphasis on reform comes as Republicans John McCain and Sarah Palin are casting themselves as mavericks bent on changing Washington's insular culture," write Michael Finnegan and Noam N. Levey of the Los Angeles Times.

But in a Bloomberg TV interview Monday night, Obama was more interested in talking about how Republican philosophies are responsible for the economic mess than precisely how to get out of it.

Eschewing "Monday morning quarterbacking" he called it "premature for us to offer up very detailed prescriptions" for how a new regulatory framework should work. And that's not all that's premature to be thinking about in detail – so is, said Obama, the idea of the government buying up mortgages ala Barney Frank – "premature for us to move forward on that (and besides it couldn't pass Congress)," he told Bloomberg's Peter Cook.

The economy is not necessarily is an automatic winner for the Dem: "For Obama to take advantage of this moment, he has to convince voters he's going to change their lives. He can't use it as merely another opportunity to paint McCain as out of touch," Slate's John Dickerson writes. "If Obama can't get anything more out of the McCain-is-out-of-touch strategy, then a day full of lampooning McCain may not do much to help Obama."

"While Obama tried to seize the moment Monday, McCain rebounded to hold his own, playing up unrelated issues like oil exploration and casting himself in the unlikely role of defender of the working class," Massimo Calabresi writes for Time.

"McCain later expanded on his remarks, saying he believes that the economy's fundamental strengths include the quality of the American worker, and the strength of American innovation and entrepreneurism," reports Bloomberg's Kristin Jensen.

Whether it works for Obama or not, the race has changed:

"All of a sudden, lipstick and pigs don't seem that important," Politico's Roger Simon writes.

"In a dizzying day of speeches and statements, neither White House hopeful offered any fresh ideas for turning things around," the AP's Liz Sidoti writes. "Instead each relied on the same vague, though vastly different, pitches he has sounded over the past few months for fixing what ails the country. . . . This is the backdrop with some seven weeks left in the campaign, and both Obama and McCain are trying to find a message that resonates with anxious voters who are fretting about their retirement nest eggs, home mortgages and job security."

"The truth is that neither candidate has done a sterling job until now of providing leadership on the issue or laying out a compelling, coherent economic plan,"'s Chris Cillizza writes.

Politico's Jeanne Cummings takes a looks at the contributions and bundlings from the two former brokerage firms benefited both candidates for different reasons (with an edge to McCain, whose $1.3 combined from Merrill and Lehman trumps Obama's half million).

"The money flow reflects key differences between the two candidates on the issue of reform. McCain has called for a commission to study the investment industry and recommend changes, including consolidating the various institutions charged with regulating them. Obama gave a speech in March, at the time of the Bear Stearns bailout, blasting the industry and the wealth gap that has emerged between Wall Street and Main Street."

As for Palin -- some fresh credibility problems emerge. This is campaigning on mythology, though not facts: "The teleprompter got messed up, I couldn't follow it, and I just decided I'd just talk to the people in front of me," Palin said in a fundraiser Monday in Canton, Ohio. "It was Ohio."

It may have been Ohio -- but the story is simply false. "This struck many of us -- who, as she spoke, followed along with her prepared remarks, and noted how closely she stuck to the script -- as an unusual claim," per ABC's Jake Tapper. "(Especially those of my colleagues on the convention floor at the time, reading along on the prompter with her, noticing her excellent and disciplined delivery, how she punched words that were underlined and paused where it said 'pause,' noting that 'nuclear' was spelled out for her phonetically.)"

"Reporters who saw the equipment that night say -- and the party has not denied -- that any teleprompter issue was minor at most. In the days after the event it was touted -- on a hush-hush, off the record basis -- by top Republicans as a way to show how swift-thinking is their newest star, despite her avoidance of any and all unscripted moments on the trail," Elizabeth Williamson reports for The Wall Street Journal.

Washington Post columnist Eugene Robinson dares utter the L-word: "What kind of person tells a self-aggrandizing lie, gets called on it, admits publicly that the truth is not at all what she originally claimed -- and then goes out and starts telling the original lie again without changing a word? . . . Maybe the Legend of Sarah Palin has become, on some level, more real to her than actual history."

New York Times columnist David Brooks dares question her readiness for the job: "Sarah Palin has many virtues. If you wanted someone to destroy a corrupt establishment, she'd be your woman. But the constructive act of governance is another matter. She has not been engaged in national issues, does not have a repertoire of historic patterns and, like President Bush, she seems to compensate for her lack of experience with brashness and excessive decisiveness."

On "troopergate" -- still cooperating fully, are we? Well: "The presidential campaign of Sen. John McCain is trying to put to rest the ethical controversy that's come to be known as 'Troopergate,' releasing e-mails supporting Alaska Gov. Sarah Palin's contention that she dismissed her public safety commissioner over budget disagreements, not because he wouldn't fire her ex-brother-in-law," the AP's Gene Johnson reports. "And, the campaign says, Palin is unlikely to speak with an investigator hired by the state legislature to look into the matter."

Who's a fiscal conservative now? "When Alaska government officials wanted to shut down a money-losing creamery, the governor overturned the decision after dairy farmers near her hometown complained the loss of subsidies would cripple them," Jim Carlton writes in The Wall Street Journal. "She then sacked the creamery board and replaced it. The new board, headed by one of her childhood friends, ordered the creamery kept open. Six months later -- after the business racked up more than $800,000 in additional losses, according to state officials -- the new board ordered it closed again."

At Newsweek, Sharon Begley takes another stab at the campaign narrative as panacea narrative of this campaign.

"The outsized power of the personal narrative today compared with even a generation ago (in 1980, Ronald Reagan ran not on personal narrative, but on hope and the promise of change) reflects something that has become almost a cliché in political analysis—namely, that emotions, more than a dispassionate and rational analysis of candidates' records and positions, determine many voters' choice on election day. The emotion can be hope or fear, pride or disgust. And don't be too quick to pat yourself on the back for thinking you cast your vote based on a logical parsing of a candidate's positions. For all but the most wonkish wonks, what matters is how the prospect of pulling out of Iraq or expanding oil drilling or any other policy makes you feel, and not a pro-and-con analysis of its pluses and minuses, which few people can figure out. (Would it be better to set up universal health insurance through a mandatory opt-in or opt-out? Exactly.)

All of this has been true for decades. What's new is that the circumstances of this election have conspired to push people away from the reason- and knowledge-based system of decision-making and more down the competing emotion-based one."

Candidate as fact-checker: "Did Barack Obama really call Sarah Palin a pig, as a John McCain ad leads people to believe? 'No,' McCain said Monday," per the AP's Brendan Farrington.

And Palin breaks with McCain, a melanoma survivor, on the critical question of tanning. Us Magazine reports: "Self-proclaimed 'hockey mom' Sarah Palin had a private tanning bed installed in the Governor's Mansion in Juneau, Alaska. . . . 'She did. She paid for it with her own money,' Roger Wetherell, chief communications officer of Alaska's Department of Transportation and Public Facilities told Us."

A closer reading of the Sex Ed law that Obama supported as a state Senator yields this nugget to Byron York at National Review: "The wording of that provision suggests lawmakers were at least as concerned with protecting children from each other as from adults, and it doesn't seem directed toward the youngest children, as Obama maintained. But there is no doubt that the bill did address the question of inappropriate touching. On the other hand, there is also no doubt that, looking at the overall bill, the "touching" provision did not have the prominence that Team Obama has suggested it had, and it certainly wasn't the bill's main purpose."

Story of the day (for a second day) if you're on Team McCain: "Sen. Barack Obama has tried in private to persuade Iraqi leaders to delay an agreement on a draw-down of the American military presence," Amir Taheri writes in his New York Post column. "According to Iraqi Foreign Minister Hoshyar Zebari, Obama made his demand for delay a key theme of his discussions with Iraqi leaders in Baghdad in July. 'He asked why we were not prepared to delay an agreement until after the US elections and the formation of a new administration in Washington,' Zebari said in an interview."

"As much resemblance to the truth as a McCain campaign commercial," responds Obama spokeswoman Wendy Morigi.

It's Day Two of ABC's "50 States in 50 Days" tour -- New York on Tuesday, Ohio Wednesday. Check out the latest tales from the rails.

The Sked:

Obama spends a second straight day in Colorado Tuesday, with a town hall in Golden, Colo., at 11:30 am ET.

He then goes from feeling the pain of the working man in Colorado, to yukking it up with Babs for bucks in California. No cameras will be getting in there, though.

Not-to-be-forgotten Sen. Joe Biden holds a town hall in Media, Pa., at 5:30 pm ET.

Michelle Obama holds a roundtable discussion with women in Fishers, Ind., and then addresses the National Baptist Convention in Cincinnati at 1:30 pm ET.

McCain holds two rallies Tuesday: one solo in Tampa at noon ET and one with his crowd-drawing No. 2 in Vienna, Ohio at 4:10 pm ET.

Part Two of Todd Palin's debut interview airs Tuesday night on "On the Record with Greta van Susteren."

Sarah Palin has no other scheduled events beside the Vienna rally.

Also in the news:

"Believers for Barack": "God-o-Meter has learned that the Obama campaign is about to email religious supporters an [announcement] about a new line of Obama faith merchandise--bumper stickers, buttons, and signs with three different messages,"'s Dan Gilgoff reports.

House Ways and Means Chairman Charlie Rangel, D-N.Y., hangs on -- for now: "Watchers of the powerful tax-writing panel are already looking at its roster of senior Democrats to try to figure out who would succeed Rangel if he decides to step aside," Roll Call's Tory Newmyer reports. "Rangel met with Speaker Nancy Pelosi (Calif.) and other Democratic leaders Monday evening but declined to discuss the session afterward."

Colin Powell, on the fence: "I have been watching both individuals, I know them both extremely well, and I have not decided who I am going to vote for," Powell said at a forum in Washington Monday. "And I'm interested to see what the debates are going to be like because we have to get off of this 'lipstick on a pig' stuff and get into issues."

Tightening in the Garden State: "Fueled by a surge of support from white voters, Republican Sen. John McCain has narrowed a 10-point gap and now trails Democratic Sen. Barack Obama 48-45 percent among New Jersey likely voters, according to a Quinnipiac University poll released today."

The New York Post's Brendan Scott calls it a move by McCain on the "Dem Empire" in a story about some tightening poll numbers in New York.

And the Boston Globe's Scott Helman recognizes the arc of this campaign, which could return to the two states that set off the Obama and McCain campaigns in the primaries:

For those who vote with their stomachs, the Boston Globe has this entrée into McCain's ribs and calamari and Obama's arugula and Mexican:

Sen. McCain opted against the pancakes Monday, when he had to cancel his pancake breakfast event and move to a bigger venue to accommodate a crowd of 3,000 in Orlando, according to the Miami Herald. Not Obama numbers, but more people are coming out for the Arizona Senator even when he doesn't have his running mate in tow.

Meanwhile, will riff on McCain's favorite form of address, cobbling together video of him addressing crowds as "My friends" with a checklist of lobbyist cum campaign workers.

The Kicker:

"For me it wasn't a huge surprise." -- Todd Palin, to Fox's Greta Van Susteren, on his wife's selection for the presidential ticket. (He's the one.)

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