Excerpted from the LA Times:
Though McCain, Clinton and Obama have talked often about taxes and spending cuts, discussing the tools available to the Federal Reserve to stem financial crises did not appear to be natural terrain for any of them.
On Monday, the three applauded the Fed's weekend move that paved the way for the buyout of Wall Street brokerage Bear Stearns. But none of the candidates offered specific economic policy proposals beyond their past statements addressing the months-old housing mortgage crunch.
Clinton issued a broad call "to be vigilant; to do everything in our power to maintain confidence in our financial system." Obama noted that when the nation faced adversity in the past, "we have summoned a spirit of cooperation and innovation to emerge stronger and more prosperous than we were before."
All of the candidates signaled an openness to consider at least some type of government intervention, such as increased regulation of financial markets. It was a noteworthy stance for McCain, who has staked out a more free-market approach to economic policy.
But comments from his chief economic advisor underscored the need for McCain to draw a distinction between himself and President Bush, who was the target of criticism Monday over what Democrats called his lack of leadership during the current economic crisis.
Asked whether McCain would consider heightened regulation to address the financial turmoil, advisor Douglas Holtz-Eakin said the candidate would not rule that out.
"He is interested in hearing a broad range of views, and he's interested in getting it right," Holtz-Eakin said. "This is too big a moment for the typical American family."
The upheaval in the financial markets has provided a pointed lesson in how little control candidates have at times over their campaigns' agendas and atmospherics. As much as they wanted, or expected, the 2008 race to hinge on the war or the demand for expanded healthcare coverage, the economy is now the No. 1 issue -- and it is forcing the candidates to formulate responses to problems without obvious solutions.
The increased focus on the economy may work to Democrats' advantage. Polls have shown that voters generally have more faith in Democrats to lead on that issue. And McCain, who has been supportive of Bush administration policies, has presented himself as a wartime military leader and even joked that economic policy was not his strong suit.
"Nothing looks good for McCain," said William Niskanen, an economist and chairman of the libertarian Cato Institute.