Market turmoil, a series of bank failures, rising foreclosures and a tough job market have many Americans feeling antsy about the economy. In early October, Congress passed a $700 billion bailout plan intended to shore up the nation's lenders. Read about the stances of the presidential candidates below. The views of the vice presidential candidates are shown where available.
Supported the $700 billion Wall Street bailout package. On October 3, he said: "America is facing one of the greatest financial crises in history, and today's passage of an emergency rescue plan was absolutely necessary to prevent an economic catastrophe that could have cost millions of jobs and forced businesses across the country into bankruptcy."
Advocates a series of reforms for the financial sector that include new oversight of investment banks, more disclosure by financial firms, higher capital requirements for firms used to operating with a minimal cash backstop, and more consistent rules that apply to all financial institutions, not just regular banks.
Supported increasing the federal insurance for money deposited in personal bank accounts to $250,000.
Advocates a $50 billion emergency economic stimulus plan. The money would go toward 1 million jobs for rebuilding infrastructure and schools, and helping local governments avoid budget cuts, the campaign says.
Proposes a Homeowner and Financial Support Act. "First, it will provide capital to the financial system. Second, it will provide liquidity to enable our financial markets to function. And third, it will do what I've been calling for since I supported legislation on it early last spring, which is to get serious about helping struggling families to restructure their mortgages on more affordable terms so they can stay in their homes," he said during a September speech.
Economic rescue plan
Proposed existing businesses will receive a $3,000 refundable tax credit for each additional full-time employee hired during 2009 and 2010. Proposed raising the small-business investment expensing limit to $250,000 through the end of 2009 and eliminating all capital gains taxes on investments made in small business.
Would create a $25 billion "Jobs and Growth Fund" to invest in infrastructure, such as roads and bridges, and to save jobs.
Called for new legislation that would give families the option of withdrawing as much as 15 percent of their retirement savings --- up to a maximum of $10,000 --- without facing a tax penalty this year or next. Also called for a temporary lifting of taxes on unemployment insurance benefits as a way of giving more relief to families.
Called on the Treasury Department to suspend the required 401(k) and IRA withdrawals for retirees over the age of 70 1/2 years.
Proposed a 90-day foreclosure moratorium "for homeowners acting in good faith" and called for $25 billion for states to help avoid property tax increases.
Under the plan, the Federal Reserve and the Treasury would provide much the same kind of backing to state and municipal governments as the recent federal bailout did to the commercial credit market.
Says Congress should immediately extend unemployment insurance for an additional 13 weeks to help families that are being hit hardest by the downturn.
Advocates closing the loophole in the bankruptcy code "that allows bankruptcy judges to modify the terms of mortgages on investment properties and vacation homes but not on primary residences" and says the legal liability of mortgage servicers should be clarified "so that servicers who work with struggling homeowners to modify their mortgages will receive legal protections." CNNMoney: More on Obama and Wall Street
Says he would balance the federal budget by ending the Iraq war and eliminating the associated expenditures, and ending tax cuts for the wealthy. Advocates rolling back oil speculation and confronting OPEC to bring down oil prices. Would invest in U.S. infrastructure - bridges, dams, roads and airports - as a means of creating jobs. Would expand the research and development tax credit and the earned income tax credit. Would crack down on predatory lending and provide tax breaks for small businesses.
Supported the $700 billion Wall Street bailout package. "This rescue bill isn't perfect, and it is an outrage that it's even necessary, but we have to stop the damage to our economy done by corrupt and incompetent practices on Wall Street and in Washington. The action Congress took [on October 3] is a tourniquet. It is not a permanent solution," he said.
Advocates reform of the financial sector. "The McCain-Palin administration will replace the outdated and ineffective patchwork quilt of regulatory oversight in Washington and bring transparency and accountability to Wall Street," he said in a statement.
Supported increasing the federal insurance for money deposited in personal bank accounts to $250,000
During the first presidential debate in September, he advocated a spending freeze to help solve the financial crisis. "How about a spending freeze on everything but defense, veteran affairs and entitlement programs?" he said. "I think we ought to seriously consider, with the exceptions the caring of veterans, national defense and several other vital issues."
Advocates creating a top-level commission to study streamlining and strengthening federal agencies charted with protecting the economy.
Called for the creation of a Mortgage and Financial Institutions Trust (MFI) to help companies avoid bankruptcy while protecting their customers. The money would also help consumers restructure loans so they can keep their homes
"The underlying principle of the MFI or any approach considered by Congress should be to keep people in their homes and safeguard the life savings of all Americans by protecting our financial system and capital markets. This trust will work with the private sector and regulators to identify institutions that are weak and fix them before they become insolvent," he said during a campaign speech in September.
During the second presidential debate on October 7, McCain unveiled a proposal aimed to ease mortgage troubles for many Americans. The plan would direct the federal government to buy up bad mortgage loans from banks and homeowners. They then would be converted into low-interest loans insured by the Federal Housing Administration.
To qualify, homeowners would have to be delinquent in their payments or be likely to fall behind in the near future. They also would have to live in the home in question -- no investment properties would be eligible. They would need to have demonstrated their creditworthiness when they purchased the property by making a substantial down payment and by providing documentation of their income and other assets.
The McCain campaign's Web site said that the "direct cost of this plan would be roughly $300 billion because the purchase of mortgages would relieve homeowners of 'negative equity' in some homes." It added that money from the $700 billion economic bailout could be used to fund the plan.
IRA and 401(k) proposal
McCain has proposed suspending the requirement that investors begin dissolving their IRAs and 401(k)s soon after age 70. "We must also protect investors, especially those relying on their investments for retirement," McCain said during an October 10 campaign rally in Wisconsin. "Current rules mandate that investors must begin to sell off their IRAs and 401(k)s when they reach age 70 and one half. To spare investors from being forced to sell their stocks at just the time when the market is hurting the most, those rules should be suspended."
The Pension and Family Security Plan
Proposes that withdrawals from tax preferred accounts -- IRAs and 401(k)s -- should be taxed at the lowest rate of 10 percent in 2008 and 2009. The policy would apply to the first $50,000 withdrawn from such accounts each year.
Proposes increasing the amount of capital losses which can be used in tax years 2008 and 2009 to offset ordinary income from $3,000 to $15,000 and reducing in the maximum tax rate on long term capital gains to 7.5 percent in 2009 and 2010
Proposes ending the taxation of unemployment insurance benefits for 2008 and 2009. The McCain campaign says the plan is targeted "to help those most in need, those who were making less than $100,000." CNNMoney: More on McCain and Wall Street
Stated during the vice presidential debate October 2, "It was the predator lenders, who tried to talk Americans into thinking that it was smart to buy a $300,000 house if we could only afford a $100,000 house. There was deception there, and there was greed and there is corruption on Wall Street. And we need to stop that.
"We need to make sure that as individuals we're taking personal responsibility through all this. It's not the American people's fault that the economy is hurting like it is, but we have an opportunity to learn a heck of a lot of good lessons through this and say never again will we be taken advantage of."
Advocates more federal oversight of investment and savings firms.