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The Federal Reserve's move to save American International Group Inc. with an $85 billion bridge loan elicited immediate responses from presidential candidates John McCain and Barack Obama Wednesday.
The Arizona senator had gone on CNBC Tuesday morning to deplore the
idea of a taxpayer bailout for AIG, saying, "I think you have to let it
fail. I know there are great efforts to raise capital to keep AIG in
business, but we cannot make taxpayers responsible." Democratic Vice
President candidate Joe Biden appeared on CNBC later in the day to
likewise decry government bailouts.
But by Tuesday evening, the current Republican administration was busy engineering a rescue, and Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke huddled with top congressional leaders from the House of Representives and members of the Senate Banking Committee to brief them on the deal. On Wednesday, the two candidates revised and extended their remarks. Obama called the AIG situation "the final verdict on the failed economic philosophy of the last eight years" and "a stark reminder of the failures of crony capitalism and an economic philosophy that sees any regulation at all as unwise and unnecessary." The McCain camp said,"These actions stem from failed regulation, reckless management and a casino culture on Wall Street." But with the deal was done, neither campaign came out directly against the takeover of AIG; except to say that shareholders and management shouldn't be bailed out. But whichever party takes over the White House in January, it is sure to have its work cut out for it installing a new set of regulatory structures and rules, after Fannie, Freddie and AIG broke all the existing ones. - George White See Dealscape post on AIG and regulation See Barack Obama statement on AIG See John McCain's statement on AIG See Dealscape post on McCain's comments See Dealscape post on Biden's comments See Dealscape post on AIG bailout See Crisis on Wall Street Dealwatch CategoriesComments Deal Video
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I am surprised McCain didn't go further in blaming Democrats instead of turning towards Wall Street which has been mainly on the Republican's side.