The Note: 'A Simple Mistake'?

Oct. 9, 2008— -- John McCain was hoping that the mortgage buy-up plan that he offered during Tuesday's debate could help separate him from President Bush while also differentiating himself from Barack Obama. It now appears, however, that he may have given the Obama campaign a new opening.

Politico's Mike Allen reports that from Tuesday to Wednesday McCain changed his mortgage buy-up plan, making it "more generous to financial institutions and more costly for taxpayers."

The McCain campaign told reporters in a Tuesday issue paper that lenders "must recognize the loss that they've already suffered."

But when McCain posted the plan to his campaign website on Wednesday, that sentence was missing.

"It's another example of John McCain's erratic response to the economic crisis," Obama communications directions director Dan Pfeiffer tells ABC News.

Pfeiffer advises that Obama will respond to McCain's mortgage plan on the campaign trail, and the campaign is launching a new television ad.

"Who wins?" asks the narrator in Obama's new ad.

"The same lenders that caused the crisis in the first place. Putting bad actors ahead of taxpayers? We can't afford more of the same."

Watch it: http://my.barackobama.com/page/content/tested_ad

A McCain campaign official sought to downplay the change in the Arizona senator's plan.

"That language was mistakenly included in the initial draft and it's been corrected. It doesn't reflect the intentions of the initiative, which necessitated the correction and the removal of the sentence," a McCain official told Politico. "A simple mistake."

The reviews of McCain's plan in Thursday's papers are less than positive.

"McCain Plan Draws Doubts From Experts on Mortgages," blares the Washington Post.

"Alan Blinder, a former vice chairman of the Board of Governors of the Federal Reserve, said he and others have supported the government buying loans at a discount and then restructuring them. But buying them at face value [as McCain is now proposing] is a dramatic departure, he said."

"It is 'outright loss for the taxpayer,' said Blinder, an Obama supporter who said he has answered queries from the Obama campaign. 'I don't see why anybody, Republican or Democrat, would want to do that. Ironically, you would be giving the biggest gifts to the lenders who made the worst mortgages.'"

"Taxpayers, Not Lenders, Would Bear Costs of McCain's Mortgage Proposal," blares the New York Times.

"Beyond the costs, the proposal could encounter a backlash from voters, especially those who have had to work hard and sacrifice to keep current on their mortgage payments and who might resent bailing out fellow homeowners who got themselves into financial trouble."

The Times' Jackie Calmes notes that the funding for McCain's proposal would come from three sources: the bailout money, the FHA's separate authority to refinance up to $300 billion in mortgages, or the mortgage-finance companies Fannie Mae and Freddie Mac, which the government now owns. (On Tuesday, the McCain campaign said the plan would come strictly from the bailout money).

On the Washington Post's op-ed page, George F. Will writes that conservatives participating in MSNBC's dial group "wrenched their dials in a wrist-spraining spasm of disapproval" when McCain unveiled his plan during Tuesday's debate.

The Wall Street Journal's John D. McKinnon writes that McCain's proposal "could make winners out of investors – including predatory mortgage lenders – that the Bush administration and Congress have tried to exclude form the government's largesse."