2008 first presidential debate, at Ole Miss: on Budget & Economy

Barack Obama: We’re in the worst financial crisis since Great Depression

A: We are going through the worst financial crisis since the Great Depression. As we engage in this important rescue effort, we’ve got to make sure that we’ve got oversight over this whole process. $700 billion, potentially, is a lot of money. We’ve got to make sure that taxpayers have the possibility of getting that money back--and gains--if & when the market returns. We’ve got to make sure none of that money is going to pad CEO bank accounts or t promote golden parachutes. We’ve got to make sure we’re helping homeowners, because the root problem has to do with the foreclosures taking place all across the country. This is a final verdict on 8 years of failed economic policies--a theory that says w can shred regulations & consumer protections and give more to the most, and somehow prosperity will trickle down. It hasn’t worked. The fundamentals of the economy have to be measured by whether or not the middle class is getting a fair shake.

Barack Obama: The lax regulation that Bush favored got us in this disaster

A: We haven’t seen the language yet, & there’s constructive work being done. I am optimistic about the capacity of us to come together with a plan. But how did we get into this situation in the first place? Two years ago, I warned that because of the subprime lending mess, because of lax regulation, that we were potentially going to have a problem & tried to stop some of the abuses in mortgages that were taking place at the time. Last year, I wrote to the secretary of the Treasury to make sure that he understood the magnitude of this problem and to call on him to bring all the stakeholders together to try to deal with it. We’ve have to intervene to solve this problem short-term. But we’re also going to have to look at how is it that we’ve shredded some many regulations, we did not set up a 21st century regulatory framework to deal with these problems. And that, in part, has to do with an economic philosophy that says regulation is always bad.

Barack Obama: Pay attention to Main Street, not just Wall Street

McCAIN: We’ve got fundamental problems in the system. And Main Street is paying a penalty for the excesses and greed in Washington, DC, and in the Wall Street. There’s no doubt that we have a long way to go, and obviously stricter interpretation and consolidation of the various regulatory agencies that weren’t doing their job that has brought on this crisis. But I have a fundamental belief in the goodness and strength of the American worker. And the American worker is the most productive, the most innovative.

Barack Obama: Decide financial rescue plan on future slower tax revenues

A: There are a range of things that are probably going to have to be delayed. We don’t yet know what our tax revenues are going to be. The economy is slowing down. So it’s hard to anticipate right now what the budget’s going to look like next year. But there’s no doubt that we’re not going to be able to do everything that needs to be done.

Barack Obama: Spending freeze is like a hatchet where you need a scalpel

McCAIN: How about a spending freeze on everything but Defense, Veterans Affairs and entitlement programs? We ought to seriously consider, with the exceptions of caring for our veterans, national defense and several other vital issues.

OBAMA: The problem with a spending freeze is you’re using a hatchet where you need a scalpel. There are some programs that are very important that are currently underfunded. I want to increase early childhood education. We’re currently spending $10 billion a month in Iraq when they have a $79 billion surplus. It seems to me that if we’re going to be strong at home as well as strong abroad, that we’ve got to look at bringing that war to a close.

John McCain: Have no doubt about the magnitude of financial crisis

John McCain: Recoup financial bailout cost by cutting spending

A: We’ve got to cut spending. We’ve let government get completely out of control. Obama has the most liberal voting record in the US Senate. It’s hard to reach across the aisle from that far to the left. The point is we need to examine every agency of government. First of all, I’d eliminate ethanol subsidies. Particularly in defense spending, we have to do away with cost-plus contracts.

John McCain: Freeze on everything but Defense, Veterans & entitlements

A: How about a spending freeze on everything but Defense, Veterans Affairs and entitlement programs? We ought to seriously consider, with the exceptions of caring for our veterans, national defense and several other vital issues.

John McCain: I have fought against excessive spending my entire career

A: We have to obviously cut spending. I have fought to cut spending. We can adjust spending around to take care of the very much-needed programs including taking care of our veterans. A healthy economy with low taxes, with not raising anyone’s taxes, is probably the best recipe for eventually having our economy recover. And spending restraint has got to be a vital part of that. One of the major reasons why we’re in the difficulties we’re in today is because spending got out of control. We owe China $500 billion. And spending can be brought under control because I have fought against excessive spending my entire career. And I’ve got plans to reduce and eliminate unnecessary and wasteful spending. If there’s anybody here who thinks there aren’t agencies of government where spending can be cut and their budget slashed, they have not spent a lot of time in Washington.