Obama: No Blank Check on Bailout

CHARLOTTE, N.C. – Senator Barack Obama said the government plan to stabilize the nation's financial markets came with "a staggering price tag," but he told voters here on Sunday that any rescue plan needed to include new regulations of the financial system.

"First, there must be no blank check when American taxpayers are on the hook for this much money," Mr. Obama told supporters at an outdoor rally in downtown Charlotte. "Second, taxpayers shouldn't be spending a dime to reward C.E.O.s on Wall Street while they're going out the door."

In his first public remarks about the $700 billion proposal that the Treasury Department and the Federal Reserve presented to Congressional leaders, Mr. Obama offered qualified support for the bailout. Until complete details emerge this week on Capitol Hill, aides said, Mr. Obama would not render a final judgment. But he said any plan had to include protections for taxpayers and assistance for homeowners at risk of losing their property.

"This initial outlay of up to $700 billion is sobering," Mr. Obama said. "In return for their support, the American people must be assured that the deal reflects the basic principles of transparency, fairness, and reform."

Here in Charlotte, with the towering offices of Bank of America and Wachovia in the background, Mr. Obama devoted a significant portion of an afternoon address to the financial crisis as he derided lax government oversight of the mortgage and financial system. He said the Bush administration has "run this economy into the ground."

But Mr. Obama added that the country shouldn't shoulder the burden alone, declaring: "This is a global crisis and the United States must insist that other nations join us in helping secure the financial markets."

In a weekend interview aboard his campaign plane, Mr. Obama offered guarded praise of how Treasury Secretary Henry M. Paulson Jr. is managing the crisis. The Democratic presidential nominee stopped short of pledging to keep Mr. Paulson in place in an Obama administration, but said the gravity of the turmoil in the nation's financial markets was so serious that continuity would be important to avert further crisis.

"Getting a new person to start juggling those balls is going to be tricky," Mr. Obama said as he arrived here in North Carolina. "Regardless of who wins the election, the issue of transition to the next administration is going to be very important. And it's going to have to be executed with a spirit of bipartisanship and cooperation."

While he is critical of how the crisis began, Mr. Obama offered kind words for the instincts and judgment exercised by Mr. Paulson in recent weeks. The two have spoken on the phone nearly every day for the past week about the problem.

"He has been put in a situation where there are no great options," Mr. Obama said. "I think he's a serious person. I think he is not an ideologue. I think he's very practical-minded and he wants to solve the problem."

To a large crowd of supporters on Sunday, Mr. Obama delivered a blistering critique of Senator John McCain, whom he accused of leading the push for deregulation during his years in Washington.

"We're now seeing the disastrous consequences of this philosophy all around us," Mr. Obama said, adding: "He calls himself fundamentally a deregulator, when reckless deregulation and lack of oversight is a big part of the problem."

Tucker Bounds, a spokesman for Mr. McCain, said the Democratic candidate had failed to outline specific proposals to address the calamity on Wall Street that has caused ripples throughout the financial markets around the world.

"Barack Obama called for decisive action, while offering absolutely no new ideas, policies or concrete solutions," Mr. Bounds said in a statement. He added, "John McCain rejected complacency and political calculation in favor of a direct call for updated, effective regulations that will protect Americans' homes, savings and jobs."

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