Economic Crises Challenge Candidates

The cascading crisis on Wall Street has underlined the economy as the No. 1 issue in the presidential campaign as the two sides jostle for an advantage in the unfolding financial disaster.

Both John McCain and White House rival Barack Obama issued cautious statements that offered no specifics about how they would deal with the financial market meltdown, but McCain used sharper language in a speech before a crowd in Jacksonville, Fla., that quickly came under attack from Obama.

"The fundamentals of our economy are strong, but these are very, very difficult times, so I promise you: We will never put America in this position again," McCain vowed. "We will clean up Wall Street."

At a later stop in Orlando, McCain added, "We will stop multimillion dollar payouts to CEOs who have broken the public trust. We will put an end to running Wall Street like a casino. ... We will make sure that your savings, IRA, 401k and pension accounts are protected."

In addition, the Republican campaign put out a new ad titled "Crisis," which declared "Our economy in crisis. Only proven reformers John McCain and Sarah Palin can fix it."

The campaign wrestled over the economic issue amid the Lehman Brothers bankruptcy, the fire sale of Wall Street icon Merrill Lynch and the desperate restructuring efforts of insurance behemoth AIG.

Obama, a Democrat, has enjoyed an edge in public opinion polls when it comes to who is believed to be best equipped to handle the economy, and he has repeatedly described the McCain economic philosophy as a continuation of the Bush administration's policies.

Obama pounced on McCain's statement as evidence that his Republican rival is unaware of how Wall Street's problems affect average Americans.

"Just a few hours ago, this morning [McCain] said that the fundamentals of the economy are still strong," Obama told a crowd at the Cross Orchards Historic Site in Grand Junction, Colo.

As the crowd booed, Obama said, his voice rising, "Senator McCain, what economy are you talking about? ... What's more fundamental than knowing your life's savings is secure? What's more fundamental than knowing you'll have a roof over your head at the end of the day?"

Obama called the latest of Wall Street's disasters the "most serious financial crisis since the Great Depression" and blamed it on Republican policies.

"I certainly don't fault Sen. McCain for these problems," Obama said, "but I do fault the economic philosophy he subscribes to."

He called the current Wall Street crisis more "evidence that too many folks in Washington and on Wall Street weren't minding the store," Obama said. He pointed to "eight years of policies that have shredded consumer protections, loosened oversight and regulation, and encouraged outsized bonuses to CEOs."

Obama noted that a new TV ad for McCain and his running mate, Alaska Gov. Sarah Palin, borrows one of Obama's trademark lines, saying McCain and Palin offer "leadership, experience, for the change we need."

"Instead of borrowing some of my lines, he needs to borrow some of my ideas," Obama said. "Change isn't about slogans. It's about substance."

Fannie Mae, Freddie Mac and Bear Stearns Challenging Candidates

Neither side offered specifics on how to deal with the unfolding economic drama, a stance similar to what occurred earlier this month when the federal government stepped in to bail out Fannie Mae and Freddie Mac, two gigantic quasi-governmental agencies that were threatened with collapse.

Both candidates said that Fannie and Freddie, as they are known on Wall Street, had become too big and needed to be restructured with closer supervision.

When the federal government backed loans in March that allowed J.P.Morgan Chase to buy the faltering Bear Stearns investment house, McCain senior adviser Dough Holtz-Eakin said the threat to jobs made the use of taxpayer money in that instance "appropriate policies."

At the time, Obama said he was generally opposed to bailouts, but that exceptions could be made to avoid a "cascading decline in credit markets."

Hank Sheinkopf, a political consultant who usually works with Democratic candidates, said, "Neither one has a plan," a situation that should help Obama "because the economic argument should benefit the Democrats."

"The Dems should be able to take advantage, but Obama is not hitting them hard on the economy. And if you don't hit hard, you have no argument," Sheinkopf said.

"It is the economy stupid, but no one's paying attention. For the Democrats to be successful, you have to punch hard and Obama doesn't seem to be able to do that," Sheinkopf added.

Massie Ritsch, spokesman for the Center for Responsive Politics, which tracks political donations, noted that both candidates "have been very reliant on contributions from Wall Street and some of the very firms that are going under have been big contributors to their campaigns."

The donations are usually funneled to the campaigns through employee donations and the CRP has calculated that employes of the securities industry is the third largest contributor to McCain's war chest, and the fourth largest donor to Obama's campaign.

"Both candidates got to where they are with a lot of help from Wall Street," Ritsch said.

ABC News' Jake Tapper contributed to this report.