The Note: Savings and Bailouts

Sept. 19, 2008— -- Six lessons of a tumultuous week in the presidential race:

1. The distance between John McCain's short list and John McCain's pink-slip list is sometimes short (and his desires may not have any relationship to actual presidential power).

2. The distance between Joe Biden's brain and Joe Biden's mouth is also sometimes short.

3. It's always going to be about Bill Clinton, to some degree, stupid.

4. Palin power has its limits.

5. Pig futures and cosmetic prices don't qualify as economic issues.

6. Neither John McCain nor Barack Obama got where he is because of the economy, but neither will either man get where he needs to go without it.

There is exactly one issue that matters right now (which means only one way to make news before the first debate).

And on that issue, the candidates may be only minor players. Staying out of everyone's way is the smart play at this moment -- and that's Obama's policy as of Friday morning -- and will soon be McCain's, too.

Perhaps the most consequential political fallout of this week that brought us a new overriding subject (in a campaign that was desperate for one) is the way in which the candidates' running room has narrowed.

Outside events -- including fresh actions Friday from a we're-still-here Bush administration and a we're not-going-home-yet Congress -- are reshaping the political field.

"Already, even before it is fully played out, the crisis means the next president -- that would be President Obama or President McCain -- will enter office with handcuffs on," Gerald Seib writes in his Wall Street Journal column. "Options are being reduced for the next president every day, as the real and psychological costs of the crisis mount. . . . The mega question -- what is the role of the U.S. government in the nation's economy? -- isn't just on the table, but at the center of the table."

"John McCain and Barack Obama acted Thursday as if either one could be the next victim of Wall Street's epic meltdown," David Saltonstall reports in the New York Daily News. "The supercharged environment led to some red-hot rhetoric on the campaign trail on the all-important -- and possibly decisive -- issue: Who can restore American prosperity?"

"The financial crisis has transformed the race, wiping away almost all other issues. In a purely political sense, the developments are highlighting economic anxiety and putting the spotlight on a topic that Democrats believe will benefit them," The New York Times' Jackie Calmes and Jeff Zeleny write.

"But what is worse for Mr. Obama and Mr. McCain is that they are on the sidelines and yet expected to act as if they have the best information available," they continue. "Another complication is that the candidates have to balance the political need to look boldly presidential against the danger of further agitating the markets or stoking Americans' anxiety."

"This is the September surprise," ABC's George Stephanopoulos said on "Good Morning America" Friday. The fall out from the current crisis is "probably going to do more to affect this presidential race than any other single factor."

At the end of a dismal messaging week for the McCain campaign, he's seeking to turn things around -- and he has a bit of window to make it happen. (Maybe one day to avoid another bad week of news cycles?)

Friday brings a McCain Chamber of Commerce speech in Wisconsin -- a late add to McCain's schedule where he'll seek to toss aside a week of poor "fundamentals" and bad surrogate work and confused radio interviews by going back to the basics.

A preview, from McCain's event Thursday night: "Republican presidential candidate John McCain brought a sharpened economic message with him to the state Thursday night, hammering Democratic rival Barack Obama as a job-killing, tax-hiking, do-nothing, old-school politician," per Greg J. Borowski of the Milwaukee Journal-Sentinel.

"McCain accused Sen. Barack Obama of 'cheerleading' the gloomy financial news, urged the ouster of the chairman of the Securities and Exchange Commission, and said that Obama's running mate believes raising taxes is 'patriotic,' " Robert Barnes and Michael D. Shear write in The Washington Post.

Welcome to the GOP comfort zone: "John McCain is trying to shift the 2008 economic debate to an issue where Republicans historically have had an edge over Democrats: taxes," Greg Hitt writes in The Wall Street Journal. "Republicans have reason to hope a sharpened focus on taxes specifically will help Sen. McCain. That is because Sen. Obama is trying to do what no national politician has done since Ronald Reagan transformed the tax debate in 1980: win on a platform that includes significant tax increases."

Joe Biden helps makes the case for him: "It's time to be patriotic," he told ABC's Kate Snow, on the need for wealthier Americans to pay more taxes. "Time to jump in, time to be part of the deal, time to help America out of the rut, and the way to do that is they're still gonna pay less taxes than they did under Reagan."

McCain gets a boost from a Washington Post editorial: "It's fair to say that Mr. McCain has dramatically ramped up the regulatory rhetoric in the wake of the meltdown on Wall Street," the editorial reads. "However, when it comes to regulating financial institutions and corporate misconduct, Mr. McCain's record is more in keeping with his current rhetoric. . . . Mr. Obama's attack does not give a fair reading of the McCain record."

As for McCain's vow to "fire" the SEC commissioner, Chris Cox: "While the president nominates and the Senate confirms the SEC chair, a commissioner of an independent regulatory commission cannot be removed by the president," ABC's David Wright reports.

Obama does the economic thing as well on Friday, meeting with advisers in Florida: "Some of the most respected names in the business world were pitching in Friday, including billionaire investor Warren Buffett, former Federal Reserve Chairman Paul Volcker, former Treasury secretaries Robert Rubin, Lawrence Summers and Paul O'Neill and Laura Tyson, former head of the Council of Economic Advisers under President Clinton," the AP's Terence Hunt reports.

"Less than seven weeks before Election Day, the high-profile consultations appeared designed to portray Obama in a presidential-like setting, grappling with the nation's gravest problems and making decisions with the help of a big-name team of experts," Hunt writes.

Says Obama, in a statement Friday morning: "Given the gravity of this situation, and based on conversations I have had with both Secretary Paulson and Chairman Bernanke, I have asked my economic team to refrain from presenting a more detailed blue-print of how an immediate plan might be structured until the Treasury and the Federal Reserve have had an opportunity to present their proposal."

As for that proposal: "The nation's congressional and economic leaders say they are committed to quickly forging a bipartisan plan to stabilize the teetering U.S. finance industry and calm tremors felt all the way to Main Street, U.S.A.," ABC's George Stephanopoulos, Charles Herman, and Michael S. James report. "The plan, which Congressional leaders hope to get today, would allow the federal government to buy up toxic assets, such as bad mortgages, held by troubled banks and other institutions. Congressional leaders said they expected to act on the plan before taking a pre-election recess."

"The basic concept would be to authorize the government to begin to buy up illiquid assets in a systematic fashion rather than in ad hoc actions such as this week's AIG bailout," David Rogers and Patrick O'Connor write for Politico. "Federal Reserve Chairman Ben Bernanke, who attended the meeting together with Treasury Secretary Henry Paulson, is expected to announce new steps as well Friday to try to ease the crisis."

"We're going to work together," Sen. Chris Dodd, D-Conn., the chairman of the Senate Banking Committee, told ABC's Diane Sawyer on "Good Morning America" Friday.

"Is this their super-plan? We want to see the details . . . This is not a done deal yet, but we know there's crisis, there's stress in the financial markets," said the committee's ranking Republican, Sen. Richard Shelby of Alabama. Estimated price tag: between $500 billion and $1 trillion, Shelby said.

Are the candidates even minor players in this drama? (And as both sides fight over advisers -- does anyone really care about them?)

A worry for McCain: "Some Republicans expressed concern at their party leader's regulatory zeal. Expanding that system would be a monumental task, says one market specialist who occasionally advises the McCain campaign, adding that the scope of the policy isn't practical," Elizabeth Holmes, Laura Meckler and Nick Timiraos write in The Wall Street Journal.

Just because they're talking doesn't mean anyone is hearing what they want to: "Creating media buzz is one thing, but capturing public opinion is another. Several attendees [of a McCain-Palin event] said going in that they wanted to hear what the Republican ticket was going to do to repair Michigan's economy. Some left still thirsty for answers," McClatchy's William Douglas writes.

The AP's Liz Sidoti sees "momentum and the political environment tilting toward the Democrats." "In recent days, Democrat Obama has seemed to regain his footing amid Wall Street's chaos and a renewed focus on the economy, a Democratic strength with a Republican in the White House. Also, McCain's late-summer boost, credited to his choice of Palin as his running mate, has appeared to dissipate."

"As global investors lost more than $3 trillion in market value this week, Barack Obama saw his own stock gaining among American voters," Bloomberg's Kristin Jensen and Kim Chipman write.

"John McCain can't decide whether he's Barry Goldwater or Dennis Kucinich," Obama said Thursday, per ABC's Jake Tapper and Sunlen Miller. "He's not clear about what he thinks or what he believes."

"Obama, who had been aggressive earlier in the week in depicting McCain as 'out of touch' for saying that the economy's fundamentals were 'sound' while the markets reeled, took a more measured route," Stephen Braun and Noam N. Levey report in the Los Angeles Times. "In Espanola, N.M., the Democrat called for legislation that would bolster 'liquidity to enable our financial markets to function.' " (A proven vote-getter.)

And yet: "Obama has used the opening to attack his opponent effectively. But he has fallen short in projecting an image of an economic crusader -- a man who can deliver something better," the Washington Independent's Sridhar Pappu writes, calling on Obama to channel Bill Clinton '92.

The more the map's changed, the more it looks the same: "It comes down to an Electoral College slugfest over 14 states," ABC's Jennifer Parker writes. "A new poll of voters in the eight states home to Big 10 universities show Obama and McCain in a statistical tie in seven of the states: Ohio, Iowa, Michigan, Wisconsin, Minnesota, Indiana and Pennsylvania."

Then there's Bill. There is an actual presidential race going on between two candidates, neither of whom is Sen. Hillary Rodham Clinton. Yet former President Bill Clinton was on CNBC Thursday saying his wife had "the most detailed position" on how to handle the economic crisis, then went on to heap praise on McCain and even Sarah Palin.

Lots of buts: "I've never concealed my admiration and affection for Sen. McCain. I think he's a great man," Clinton told Maria Bartiromo. "But, I think, on the issues that matter to our future, the Obama-Biden team is, is more right. . . . And I believe they're gonna win. But, I think that it will be competitive until the end."

"See if you can find an endorsement in here from the ex-president, a sound bite or relevant point that would actually help Obama, or is it merely a verbal wandering and pro forma party prediction that no one can criticize," Andrew Malcolm blogs for the Los Angeles Times.

The Palin files get still more interesting: "The 3.2-mile-long partially paved 'road to nowhere' meanders from a small international airport on Gravina Island, home to 50 people, ending in a cul-de-sac close to a beach. Crews are working to finish it. But no one knows when anyone will need to drive it," reports Erika Hayasaki of the Los Angeles Times.

"That's because the $26-million road was designed to connect to the $398-million Gravina Island Bridge, more infamously known as the 'bridge to nowhere.' Alaskan officials thought federal money would pay for the bridge, but Gov. Sarah Palin killed the project after it was ridiculed and Congress rescinded the money. Plans for the road moved forward anyway."

From the annals of transparency: "Alaska Gov. Sarah Palin's husband has refused to testify in the investigation of his wife's alleged abuse of power, and key lawmakers said Thursday that uncooperative witnesses are effectively sidetracking the probe until after Election Day," per the AP's Matt Volz.

Serious skepticism, from a McCain friend: "You get a passport for the first time in your life last year? I mean, I don't know what you can say. You can't say anything," said Sen. Chuck Hagel, R-Neb., saying something to the Omaha World-Herald's Joseph Morton. "I think it's a stretch to, in any way, to say that she's got the experience to be president of the United States. . . . I think they ought to be just honest about it and stop the nonsense about, 'I look out my window and I see Russia and so therefore I know something about Russia.' "

No Hagel endorsement, but a GOPer for Obama: "Rep. Wayne Gilchrest, a maverick Republican from Maryland, endorsed Illinois Democratic Sen. Barack Obama for president in an interview Wednesday with WYPR, Baltimore's National Public Radio station," per Politico.

The Washington Post looks at Palin's governing style: "The woman chosen by Republican Sen. John McCain as his vice presidential running mate has little interest in political give-and-take, or in sustained working relationships with legislators or other important figures around the state. Nor has she proven particularly attentive to the details of public policy," write Amy Goldstein, Kimberly Kindy, and Steven Mufson. "But those who know her say Palin, 44, is uncommonly deft at something else: sensing the mood of her constituents, shaping her public messages and harnessing a remarkable personal popularity to accomplish what she wants."

Not this again: "Vice President Dick Cheney has said his office only partially belongs to the executive branch. Democratic vice presidential nominee Joe Biden disagrees and Republican rival Sarah Palin isn't saying," The Hill's Kevin Bogardus reports.

Something else she isn't saying: The Palin-McCain team (yes, governor, it can work in that direction too, we suppose) still hasn't taken a position on a certain Senate race in Alaska.

Their silence "may be an opportunity for [Ted] Stevens," William Yardley writes in The New York Times. "Ms. Palin has long had a distant relationship with Mr. Stevens, but as she has moved to the national stage, Mr. Stevens has risen in some opinion polls in Alaska, a benefit some have attributed at least in part to the Republican enthusiasm Ms. Palin has generated."

Stevens isn't the only incumbent who may be helped: "After months of fundraising doldrums, recruitment misfires and daunting polls, Republicans believe they are finally on the rebound in the battle for Congress," Shailagh Murray and Paul Kane write for The Washington Post. "Both sides concede that the GOP stands almost no chance of taking back the House or Senate in November, but party leaders think the Palin factor and an increasingly competitive fight for the White House have generated enthusiasm and momentum that could limit GOP losses to only a few Senate seats and perhaps fewer than a dozen House seats."

"New polling suggests that the Republican Party is beginning to regain some of its luster and, perhaps as important, is experiencing a surge in excitement among its political base," Politico's David Paul Kuhn writes.

Serving her purpose? "Though the Palin experiment is still in its early stages, she has already contributed something crucial to the ticket: she is allowing John McCain to run as John McCain," Jennifer Rubin writes for the New York Observer. "Just by being on the ticket, Palin has given the conservative base more than they could have hoped for when McCain won the nomination."

Not that the new McCain looks much like the old one: "As Mr. McCain worked his way through Florida and Ohio this week as the Republican presidential nominee, he was a candidate transformed," Adam Nagourney writes in The New York Times. "He unsmilingly raced through a series of relatively brief speeches, reading often from a teleprompter, and served up a diet of the kind of sound-bite attacks that he used to dismiss with an eye roll."

The Sked:

Obama holds a 9:45 am ET economic policy meeting in Coral Gables, Fla., and holds a women's rally at 11:45 am ET.

Running mate Joe Biden and wife Jill spend their Friday in Sterling, Va., where they will hold a women's rally at noon ET.

McCain and Palin remain inseparable on the campaign trail -- they will spend the morning in Green Bay, Wis., where McCain will speak at the Resch Center at 9 am ET. They then travel to Blaine, Minn., for rally at 1 pm ET.

Also in the news:

After being featured in an Obama radio ad, Rush Limbaugh swings back -- hard: "Barack Obama -- the supposedly postpartisan, postracial candidate of hope and change -- has gone where few modern candidates have gone before," he writes in a Wall Street Journal column.

"Mr. Obama's campaign is now trafficking in prejudice of its own making. And in doing so, it is playing with political dynamite. What kind of potential president would let his campaign knowingly extract two incomplete, out-of-context lines from two radio parodies and build a framework of hate around them in order to exploit racial tensions? . . . Any candidate who employs the tactics of the old segregationists is unworthy of the presidency."

And he's the foreign-policy expert? "John McCain either doesn't want to meet Spain's prime minister any time soon or isn't quite sure who he is," per the AP's Daniel Woolls. "In a radio interview broadcast in Spain and other Spanish-speaking countries Thursday, the Republican presidential candidate repeatedly dodged questions as to whether he would invite Socialist Prime Minister Jose Luis Rodriguez Zapatero to the White House if McCain wins in November."

"Some Spaniards are wondering whether John McCain has turned cool toward their prime minister -- or maybe can't remember him -- after confusing comments by the Republican presidential candidate," Paul Richter reports in the Los Angeles Times.

Nothing much doing in those e-mails: "A person taking credit for hacking into Alaska Gov. Sarah Palin's personal Yahoo account claims to have read the Republican vice-presidential candidate's e-mails to find something that 'would derail her campaign' after using publicly available biographical data to reset her password, according to a posting on the Internet," Kara Rowland writes for the Washington Times. " 'There was nothing there, nothing incriminating -- all I saw was personal stuff, some clerical stuff from when she was governor,' the person wrote in a message on 4chan.org that was later erased, according to Wired.com, which copied the account on its Web site."

Religious appeals: "An official with Barack Obama's campaign tells The Brody File that beginning next week the campaign will start an official faith tour in key battleground states called 'Barack Obama: Faith, Family and Values Tour,' " per the Christian Broadcasting Network's David Brody. "The subheading of the tour is as follows: 'Voting ALL Our Values.' "

Brody also catches up with Palin's childhood pastor, who has this to say about the governor as a girl: "When she was a little younger, she was a little fidgety, but as she began to hear the music and began to hear the different illustrations given, it seemed to attract her and she was more motivated to respond and I think that drew her to the final commitment of stepping out and saying I want to be that kind of person."

Sorry, Sarah: "The organizers of an anti-Iran rally at the United Nations Monday have withdrawn their invitation for Alaska Gov. Sarah Palin to speak, fearing that her appearance would give the event a partisan cast," Newsday's Craig Gordon writes.

Elizabeth Edwards speaks: "When you mention trust, that's probably the most difficult hurdle," she told the Detroit Free Press. "My concern at the present time is that these children can live with their father being an advocate for poverty, not for this current picture of him to be the one they carry with them, as young people and as adults."

The Kicker:

"I got just sandwiched and knocked out cold." -- Joe Biden, recalling his short-lived football career, during a visit to the Pro Football Hall of Fame.

"We've gotten the two questions in. You were promised two -- you were trying to sneak in three." -- Barack Obama, ending a local TV interview after losing a battle with a fly.

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