VP debate: Economy, Iraq take center stage in St. Louis

ST. LOUIS -- Vice presidential candidates Sarah Palin and Joe Biden sparred Thursday about economic policy, pursuit of the war in Iraq and the records of their party nominees in an eagerly anticipated debate that included humor, emotion and sharp elbows.

Palin, the Alaska governor and running mate of Republican John McCain, and Biden, the Delaware senator and pick of Democrat Barack Obama, faced off in their only debate. It was the eighth matchup of vice presidential nominees since the first such meeting in 1976.

The debate at Washington University in St. Louis — coming a day after the Senate overwhelmingly passed a $700 billion rescue package for Wall Street — quickly focused on the nation's financial meltdown.

Biden repeatedly tried to tie Palin and McCain to the unpopular Bush administration and the current economic crisis that has threatened credit markets worldwide.

"The economic policies of the last eight years have been the worst economic policy we've ever had," Biden said. "The wealthy have done very well. Corporate America has been rewarded. … Barack Obama will change it."

Palin, meanwhile, praised McCain's call in 2006 for greater oversight of mortgage giant Fannie Mae and blamed "predatory lenders" for the financial fears of Americans current crisis. "Go to a soccer game on Saturday, turn to any parent on the sidelines and ask them how they feel about the economy," Palin said. "I bet ya you're going to hear some fear."

Biden charged that McCain was slow to recognize the magnitude of economic problems, calling the Arizona Republican "out of touch." And he said McCain's opposition to oversight for Wall Street contributed to the cascade of bad lending at the heart of the meltdown.

Both candidates claimed the mantle of change for their tickets, with Palin saying she and McCain are known "for putting partisan politics aside." She cast the GOP nominees as reformers who would get government out of the lives of ordinary people. Biden, meanwhile, said he and Obama would "make significant changes so that we are once again the most respected nation in the world."

The candidates agreed on U.S. support for Israel and differed on Obama statement in a Democratic primary debate that he would step up talks with rogue nations such as Iran and Cuba without preconditions. Biden said U.S. allies "are on that same page" with Obama on increased diplomatic efforts. Palin, however, said Obama's stance goes "beyond naïvete and goes beyond bad judgment."

The often-friendly tone of the debate shifted sharply on the war in Iraq.

The Alaska governor criticized Biden for having been "for the war" before he was against it. He responded by saying that McCain went along with the Bush administration's prediction that the war would be short and successful. "John McCain was lockstep with (Vice President) Dick Cheney," he said.

Palin, whose eldest son is serving in Iraq, and Biden, whose son is to deploy today, clashed on strategies for ending the war. "For John McCain there is no end in sight. Fundamental difference. We will end this war," Biden said of Obama's plan for withdrawing U.S. combat troops in 16 months.

"Your plan is a white flag of surrender in Iraq," Palin shot back.