McCain says Fed should stop government bailouts

[Guest guest]

Another reason to vote for him.

http://news.yahoo.com/s/ap/20080919/ap_on_el_pr/mccain_financial_crisi

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McCain says Fed should stop government bailouts By BETH FOUHY,

Associated Press Writer

6 minutes ago

Republican McCain said Friday the Federal Reserve needs to stop

bailing out failed financial institutions.

The Republican presidential hopeful said the Fed should get back

to " its core business of responsibly managing our money supply and

inflation " and he laid out several recommendations for stabilizing

markets in the financial crisis that has rocked Wall Street and

commanded the dialogue in the presidential campaign.

McCain made little mention of the massive proposal being crafted by

Treasury Secretary Henry son that could amount to a $1 trillion

taxpayer bailout of the mortgage industry. McCain said simply that

leaders should put aside partisan differences and " any action should

be designed to keep people in their homes and safeguard the life

savings of all Americans. "

The Fed engineered an $85 billion takeover of insurance giant AIG

this week after seizing control of housing giants Freddie Mac and

Fannie Mae. McCain said that to help return the U.S. to fiscal

solvency, the powerful central bank should instead focus on shoring

up the dollar and keeping inflation low.

" A strong dollar will reduce energy and food prices, " McCain said to

applause from the Green Bay Chamber of Commerce. " It will stimulate

sustainable economic growth and get this economy moving again. "

In the speech and later at a boisterous rally in Minnesota, McCain

sharply criticized Democratic rival Barack Obama for ties to Freddie

Mac and Fannie Mae and for advocating tax increases McCain said

would " turn a recession into a depression. "

Obama has said he would raise taxes on people making over $250,000 a

year and would cut taxes on the middle class. McCain restated his

claim that Obama had voted to raise taxes on people who make just

$42,000 a year — a claim that has been widely debunked by nonpartisan

fact check organizations.

McCain noted the Illinois senator had taken large campaign

contributions from both Fannie Mae and Freddie Mac and that the one-

time head of Obama's vice presidential search team, Jim , had

received a $21 million severance deal after stepping down as Fannie

Mae CEO. McCain's campaign released a new television ad Friday

hitting Obama for his connection to .

The Arizona senator neglected to say that some of his closest

advisers had ties to or lobbied for the home loan giants.

McCain is correct when he says Obama is the No. 2 recipient of

campaign money from employees of Fannie Mae and Freddie Mac. Obama

has collected $126,349 from those sources, according to a compilation

by the Center for Responsive Politics, second only to Senate Banking

Committee Chairman Sen. Dodd, D-Conn., who has received

$165,400. The ranking covers the period since 1989.

In Minnesota, the mention of 's severance deal brought loud

chants from thousands of McCain supporters who filled an airport

hangar. " Give it back! Give it back! " they shouted.

McCain renewed his call for tighter regulation of financial markets,

even though he has generally championed deregulation throughout his

career in the Senate and as chairman of the influential Commerce

Committee.

He called Securities and Exchange Commission a " good man "

but reiterated his view that should step down or be fired, saying

there needed to be greater accountability in Washington.

McCain said as president he would create a Mortgage and Financial

Institutions Trust to help homeowners avoid foreclosure. He said he

would propose and sign into law changes to prevent financial firms

from concealing " bad practices. "

Throughout the week, McCain and Obama have tangled over which

candidate is better to steer the U.S. out of its financial crisis.

One investment giant, Lehman Brothers, collapsed this week and

another, Merrill Lynch, was purchased by rival Bank of America for

less than half its value.

McCain spokesman Matt Mc said the campaign was reviewing the

son plan and McCain had not yet taken a position on it. " He's

supportive that there are steps being taken, " he said.

Copyright © 2008 The Associated Press. All rights reserved. The

information contained in the AP News report may not be published,

broadcast, rewritten or redistributed without the prior written

authority of The Associated Press.

[Guest guest]

He's right. The government is already spending more on existing programs than it takes in on taxes and it is going to get steadily worse as "Entitlement Spending" keeps growing.

I have also heard that there is a strong possibility that the US's credit rating may be dropped, primarily because of the bailouts rather than the private sector financial problems. If that happens, the debt is going to shoot up because interest rates will have to go up.

In a message dated 9/19/2008 6:05:13 P.M. Eastern Daylight Time, no_reply writes:

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