Media reports this morning note disagreements have surfaced between the Administration and Congress over the final shape of a financial rescue package. However, commentators believe the partisan jockeying will not jeopardize passage of the bill at least not yet. The Wall Street Journal, for example, reports that "there's no sign yet that Congress will delay or derail the proposal," and that Congress and the Treasury Department "appear to be in agreement on the big picture, namely the need and the cost." The New York Times, similarly, notes the "bipartisan support" for the bailout but adds "senior lawmakers put forward some of their own ideas" including "greater Congressional oversight, more direct assistance for homeowners, and restraints on the pay of top executives." Roll Call says "Congressional leaders were confident Sunday that they will pass a $700 billion bailout package in the coming days, despite an emerging partisan split over homeowner protections and executive salary caps being part of the plan."
Still, says the New York Times, as of last night "competing interests were already complicating the negotiations," and "financial companies were already lobbying to broaden the plan." The Washington Times reports "key Democrats in Congress, backed by party presidential nominee Sen. Barack Obama on the campaign trail, made it clear Sunday that their support for the rescue blueprint...comes with a price." The Financial Times runs a similar story under the headline "Democrats Demand Further Measures."
Focusing on emerging disagreements, the Wall Street Journal says, "Congressional Democrats said they were wary of handing a lame duck administration what one aide called a 'blank check.'" In a sharply critical piece, meanwhile, McClatchy reports Paulson repeatedly said yesterday that the current "financial problems were long in the making. He should know. He was part of the Gold Rush that has brought the global financial system to the brink of collapse."
Under the headline "Dems Say They Won't Get Fooled Again," The Politico reports, "Sen. Patrick Leahy (D-Vt.) says he's seen this movie before: The Bush administration, citing an unprecedented national threat, puts the hammer on Congress to ram through gargantuan legislation with a minimum of review -- and the murkiest of repercussions."
The AP says while "Congressional Democrats said they understood the need for urgency," they "insisted that the measure needed to provide help for homeowners threatened with losing their homes. And some GOP leaders told the White House on Sunday to prepare to accept more oversight and guarantees that the Treasury will recoup some of the bailout money." AFP reports Sen. Charles Schumer "said the rescue was needed but had to be carried out in an open, transparent way and provide some relief for homeowners as well." Bloomberg News, Los Angeles Times, McClatchy and The Hill also report on Democratic plans to change the bill.
Paulson Urges Quick Action On "Clean" Bill USA Today reports Treasury Secretary Henry Paulson, appearing on four morning TV shows yesterday, "called for quick action on a $700 billion bailout bill but resisted Democratic calls to include further relief for homeowners." Paulson "expressed little interest in efforts by Democrats to include further relief for homeowners facing mortgage foreclosures, a $50 billion stimulus effort and a cap on compensation of executives at the troubled firms that will be bailed out. Such efforts, he said, would simply slow down attempts to get a rescue package in place soon." NBC Nightly News noted Paulson "says the crisis needs action now. There will be time for reform later."
The Washington Post reports Paulson "warned lawmakers to resist adding too many provisions to the bill," saying, "We want this to be clean, and we want this to be quick, and it's urgent that we get this done." ABC World News said Paulson "was very blunt, today, calling this" bailout "a humbling, humbling time for the United States."
Paulson Called US' "Most Powerful Leader" Newsweek's Daniel Gross, in a cover story on Treasury Secretary Paulson, writes, "At a time when President Bush seems to have largely checked out, the teetotaling 62-year-old has emerged as the nation's most powerful leader -- the investment banker in chief." Paulson "has the credibility and the respect of the markets, as well as power and authority. As a result, he has operated with considerable autonomy."
U.S. News and World Report says, "The job of keeping the Great Unwind from turning into another Great Depression has now fallen to" Federal Reserve Chairman Ben Bernanke and Paulson. Newsweek's Fareed Zakaria writes, "In Paulson, America is extremely fortunate to have a man of tremendous intelligence, drive and pragmatism, who will engage in 'bold and persistent experimentation' until the job is done."
Deficit Could Reach Trillion Dollars The Financial Times reports the "US Treasury's $700bn rescue plan for distressed mortgage assets seems likely to give us another: the trillion-dollar deficit." Whatever the "final cost to American taxpayers will be, they are now directly or indirectly providing a backstop for assets worth a great deal more than the federal government's current $5,400bn...in debt." The Washington Times also reports, "As the US government embarks on a financial-rescue mission -- whose cost is impossible to predict -- the nation is already headed for a sustained period of budget deficits on a scale never seen before, said Peter R. Orszag, director of the Congressional Budget Office."
The Federal Reserve approved the request by Goldman Sachs and Morgan Stanley to change their status from independent investment banks to bank holding companies. The move offers advantages to the two firms, such as wider access to loans from the Fed's discount window, but comes at the cost of increased regulation. The AP reports the change "in status will allow them to create commercial banks that will be able to take deposits, bolstering the resources of both institutions." The Fed "central bank said that to provide increase funding support to the two institutions during the transition period, they would be allowed to get short-term loans from the Federal Reserve Bank of New York against various types of collateral."
The New York Times reports the transformation will subject the banks "to far greater regulation." It was "a blunt acknowledgment that their model of finance and investing had become too risky and that they needed the cushion of bank deposits that had kept big commercial banks like Bank of America and JPMorgan Chase relatively safe amid the recent turmoil."
The Washington Post reports the story on the front page under the headline, "Giant Investment Banks Grasp For Government Safety Net." The "conversion of investment banks into the kind of banking companies that once were their rivals will have profound and long-lasting implications for the economy."
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The New York Sun reports that in the wake of two "major terrorist attacks on Western targets" in Yemen and Pakistan, the US "counterterrorism community is warning that Al Qaeda may launch more overseas operations to influence the presidential elections in November." US "military and intelligence agencies intercepted a series of messages" in August "from Al Qaeda's leadership to intermediate members of the organization asking local cells to be prepared for imminent instructions."
President Bush will make his final visit to the United Nations this week. The AP reports the President "is sharing the spotlight this week with candidates, the crisis on Wall Street and world standoffs with Russia, North Korea and Iran" as he prepares to deliver "his farewell address to the world body on Tuesday." His speech "will stress the need for multination diplomacy, but it comes at a time when many of these collective diplomatic ventures he's championed are stuck in reverse."
The Washington Post reports Bush "is not a huge fan of the more formal kinds of socializing presidents do, but he appears to be in a sentimental mood" as "the round of goodbyes continues this week." Though he "has typically used his time in New York to have one-on-one meetings with world leaders gathered for the opening of the UN session," he "has chosen to have most of those meetings at the White House this time."
The AP reports that during his three-day visit to New York, Bush and Iraqi President Jalal Talabani "will co-host a meeting to show appreciation to countries that participated in the US-led coalition on the ground in Iraq." The event "is a thank-you, but it also is a means of trying to show the world that the US is a team player," adds the AP.
Newsweek reports that former CENTCOM commander retired Gen. John Abizaid's "remarks at a Marine Corps University conference last week appeared to echo the thinking of at least some in the upper echelons of the U.S. military: Israel is incapable of seriously damaging Iran's nuclear program." Abizaid "caused a stir last year by publicly asserting the United States could live with a nuclear-armed Iran through a strategy of cold-war-style deterrence."
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The New York Times reports this morning on its front page that both Sens. John McCain and Barack Obama said yesterday in interviews with the paper that there should be more oversight of the federal government's $700 billion plan to stabilize the financial markets, but "said the potentially enormous expenditure would not force them to scale back their ambitious governing agendas." The Wall Street Journal similarly reports, "In a pair of interviews Sunday with CNBC, neither candidate said the $700 billion bailout would stop their tax cuts or spending plans. Asked whether he could still balance the budget in his first term, Sen. McCain said he could as long as spending is restrained. Sen. Obama said he would continue to press his domestic agenda as long as it is all paid for with offsetting cuts and tax increases."
Obama Criticizes McCain, Echoes Democratic Leaders' Criticism Of Bailout Other media stories focus on both candidates' statements on the crisis throughout the day. Bloomberg News notes Obama "echoed the concerns of congressional Democrats who are raising objections to elements of Treasury Secretary Henry Paulson's plan to buy as much as $700 billion in soured assets from financial firms." Speaking "to about 25,000 people at a rally in Charlotte, North Carolina," Obama "repeated his call for the rescue plan to put the interests of average Americans at the top of the agenda." The Washington Post also reports Obama "cautioned that any final deal must offer protection to taxpayers and homeowners as well as to Wall Street." ABC World News showed Obama saying in North Carolina, "I'm a little hot under the collar about these failed economic policies."
Asked on CBS's 60 Minutes to identify who is to blame for the current credit crisis, Obama said that "there were a lot of factors involved. But I think there is no doubt that if we had had a regulatory system that had kept pace with the changes in the financial system, that would have had an enormous impact in containing some of the problems that are out there."
McCain Hammers Bush Administration In a story headlined "John McCain boldly slams President Bush for Wall Street meltdown," the New York Daily News reports, "With Wall Street's binge likely to become Main Street's hangover," McCain "launched his sharpest shots to date Sunday night at fellow Republican George W. Bush. 'I say the Bush administration has failed,' McCain said...after agreeing that he placed 'a great deal' of responsibility on the President for the financial meltdown." On CBS's 60 Minutes, McCain said that Americans "should be deeply concerned about the fact that innocent Americans that don't work on Wall Street, and don't work in Washington, are the victims of the greed, the excess, and, yes, in some cases, corruption. There's a social contract that Adam Smith talked about between capitalism and the people. That contract has been broken."
McCain Says He Would Replace Cox With Cuomo Asked who he would pick to replace SEC Chairman Chris Cox, who he has said should be "fired," McCain said on CBS's 60 Minutes, "This may sound a little unusual, but I've admired Andrew Cuomo. I think he is somebody who could restore some credibility, lend some bipartisanship to this effort. ... And he has respect and he has prestige."
The AP reports Sens. Barack Obama and John McCain "together spent $94 million in August, a record spree mostly aimed at about a dozen states that will probably decide their historic presidential contest." Their campaign finance reports, "filed before Saturday's midnight deadline, shows that more than half of their $3-million-a-day spending rate was devoted to advertising that became increasingly negative during the month." The New York Times adds that Obama "significantly outspent" McCain last month, "with the Obama campaign spending $53 million that month, $32 million of which went to advertising." That "compared with the $41 million spent by the McCain campaign, $23 million of which went to advertising." The New York Daily News adds, "New figures show that Obama and the Democratic National Committee started this month with $95 million in the bank, compared with a war chest of $94 million for McCain and the Republican National Committee."
Gov. Sarah Palin headlined a rally in The Villages in Florida yesterday that the St. Petersburg Times calls "what appeared to be the largest crowd of any presidential rally in Florida this year" and says the crowd was "so excited it could have passed for a visit by the pope." The Fort Myers News-Press reports that the fire chief for The Villages, an upscale retirement community of more than 70,000, "estimated the crowd at 60,000," although the Tampa Tribune says that "security officials at the scene estimated" the crowd "at 25,000 or more." The Tribune does say, though, that the event was probably the largest political rally in Florida history. In a story headlined "Palin Draws Record Crowd In Central Florida," the Palm Beach Post says that Palin's speech was "fairly conventional fare," but "the similarities to a standard VP candidate appearance ended there." The Lakeland Ledger notes, "Many in the crowd said it was their first visit to any campaign event."
The Wall Street Journal reports that in preparing for Friday's debate, the Sens. Barack Obama and John McCain campaigns are "seeking even the smallest advantage. Obama advisers, for example, are considering how to provoke Sen. McCain into anger or showing what they say is how out of touch, or old, he is. Advisers have told Sen. McCain to watch out when Sen. Obama uses the phrase, 'As I've said before...' One McCain adviser said it is used 'when Obama actually changes his position, to pretend it's what he's always said.'" The AP adds that while McCain and Obama are slated to debate three times ahead of the November vote, "the opening presidential debate traditionally sets the tone for voters and it's often difficult for a candidate to overcome a poor performance."
The Washington Times reports Obama "will hunker down nearly all week to prepare for the most crucial 90 minutes of his political life -- the first presidential debate." USA Today notes, "It does not appear that McCain will conduct the kind of 'debate camp' used by Obama as well as previous presidential candidates," as he has a fairly full schedule throughout the week.
The Gallup daily presidential tracking poll of 2,720 registered voters taken September 18-20 shows Barack Obama leading John McCain 48%-44%. The Rasmussen Reports automated daily presidential tracking poll for September 21 shows Obama leading McCain 48%-47%.
Obama Has Narrow Lead In Pair Of Michigan Polls A Detroit News /Epic MRA poll of 602 likely Michigan voters taken September 14-17 shows Obama leading McCain 43%-42%. An American Research Group poll of 600 likely Michigan voters taken September 15-19 shows Obama leading McCain 48%-46%.
McCain Edges Obama In 2 Florida Polls A Miami Herald /St. Petersburg Times poll of 800 registered Florida voter takes September 14-17 shows McCain leading Obama 47%-45%. A Florida Times-Union/South Florida Sun Sentinel poll of 600 likely Florida voters taken September 15-18 by Research 2000 shows McCain leading Obama 46%-45%.
McCain Up 6 In Ohio An Ohio News Organization, a consortium of the state's eight biggest papers, poll of 869 likely Ohio voters taken September 12-16 shows McCain leading Obama 48%-42%.
McCain Up 4 In Missouri A Research 2000 poll of 800 likely Missouri voters taken "last week" for the St. Louis Post-Dispatch shows McCain leading Obama 49%-45%.
Race Tight In Nevada A Suffolk University poll of 600 likely Nevada voters taken September 17-21 shows McCain leading Obama 45.8% to 45.5%.
Obama Holds Solid Lead In Iowa A Research 2000 poll of 600 likely Iowa voters taken September 15-17 for the Quad City Times shows Obama leading McCain 53%-39%. An American Research Group poll of 600 likely Iowa voters taken September 17-20 shows Obama leading McCain 51%-44%.
McCain Tops Obama In Virginia An American Research Group poll of 600 likely Virginia voters taken September 17-20 shows McCain leading Obama 48%-46%.
Obama Up 1 In Minnesota An American Research Group poll of 600 likely Minnesota voters taken September 18-20 shows Obama leading McCain 48%-47%.
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Jay Leno: "Give you an idea how bad the American economy is -- Mexico is now calling for a fence along the border."
Jay Leno: "Barack Obama continues to criticize John McCain's economic plan. McCain would like to criticize Obama's economic plan, but nobody knows what it is yet."
Jay Leno: "President Bush has issued a new warning to Iran that it faces new economic sanctions after reports by the UN atomic watchdog committee that Iran is still enriching uranium. President Bush promising new economic sanctions. And believe me, if there's one thing the President is an expert on, it is ruining a country's economy."
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