Credit Crisis Has Given Obama a Distinct Edge

McCain Ready for A Change Of Subject
Credit Crisis Has Given Obama a Distinct Edge

By Dan Balz and Shailagh Murray
Washington Post Staff Writers
Sunday, September 28, 2008; A01

In the two weeks that the Wall Street financial crisis has dominated the political debate, the presidential race has shifted from what had been essentially a dead heat to one in which Sen. Barack Obama has opened up a narrow but perceptible advantage nationally, as well as in a number of battleground states.

The burden now falls on Sen. John McCain to reverse the effects of the focus on the economy, and to keep the contest close enough so that a dominant debate performance, a gaffe by Obama or some outside event can shift the momentum back to him.

Although Friday's debate in Oxford, Miss., produced no outright winner, strategists in both parties said the coming weeks, which will include three more debates -- two between McCain and Obama and the third between vice presidential candidates Gov. Sarah Palin and Sen. Joseph R. Biden Jr. -- could be decisive in determining whether the election remains on a trajectory favorable to Obama or shifts back toward too-close-to-call status.

McCain advisers are well aware that the past two weeks have brought a shift in the race, but they say that between now and Election Day, there is plenty of time for the fortunes of the two candidates to change again.

"The first lesson of this campaign, going back to 2007, is not to be panicky or reactive to poll numbers," said McCain senior adviser Steve Schmidt. "A few weeks back, we had a clear lead, albeit a narrow one, and there were a lot of people on the Democratic side haranguing the Obama campaign in the sense of panic. We always understood not only would that lead dissipate but bounce back the other way and then bounce back again."

For McCain, the danger is that previously undecided voters will become comfortable that Obama is ready to be president. The longer Obama can hold even a small lead, the more difficult it will be for McCain to reverse it, absent something unexpected happening. McCain's best hope, strategists said, is for the crisis atmosphere around Wall Street and the credit markets to lessen, allowing the campaign debate to focus on other questions as much as the economy. The agreement reached early this morning on Capitol Hill about a Wall Street relief package may help with that.

Schmidt said the campaign will press two arguments as forcefully as possible in the coming days. One is that Obama is not ready to be commander in chief and that, in a time of two wars, "his policies will make the world more dangerous and America less secure." Second, he said, McCain will argue that, in a time of economic crisis, Obama will raise taxes and spending and "will make our economy worse."

Obama signaled yesterday that his focus will be on painting McCain as out of touch on the economy. Appearing at a rally in Greensboro, N.C., Obama ripped into his rival's remarks about the economy during the debate -- but more for what McCain didn't say.

"The truth is, through 90 minutes of debating, John McCain had a lot to say about me, but he had nothing to say about you. He didn't even say the words 'middle class.' Didn't say the words 'working people,' " Obama told a cheering crowd of about 20,000 people on a rainy morning. He later appeared in Fredericksburg, Va., and spoke at the Congressional Black Caucus Foundation dinner in Washington. [Story, A14.]

The middle-class omission also is the subject of an Obama television ad that the campaign rolled out yesterday, asserting: "McCain doesn't get it. Barack Obama does."

McCain, who returned to Washington immediately after the debate, remained largely out of sight yesterday. Aides said he was working the phones with congressional leaders, monitoring the pace of negotiations over a financial rescue package that officials hope to have ready for a vote by the beginning of the week. They argued that without his input, the package under consideration earlier last week was doomed to fail.

But strategists said McCain will be challenged to reverse current trends, particularly in a year in which voters are gloomy about the state of the country and are looking for a change in direction after eight years of President Bush's policies.

"What begins to happen is that the margin that's been in place begins to solidify more and more," said Matthew Dowd, who was Bush's chief strategist in 2004 and is now an independent analyst. "There's only two ways this can go," he added. "It will either solidify with an Obama four- to five- point lead, or it will loosen and go back to close and go back and forth."

Both campaigns launched a war of ads and news releases yesterday as each side claimed victory in their first general-election showdown, held at the University of Mississippi.

The McCain campaign e-mailed four "volumes" of reviews about his performance, described by various pundits and editorial writers as "emphatic," "assured" and "authoritative."

Obama aides said the Democratic nominee cleared a major hurdle with undecided voters by projecting confidence, giving crisp answers and standing his ground when pressed by McCain on a range of foreign policy issues, including the fate of Iraq and Afghanistan and the challenges posed by Russia and Iran.

Overnight polls suggested Obama had won, although the samples in one case were tilted toward Democrats.

Obama and McCain will not debate again until Oct. 7, but Palin and Biden will meet in St. Louis on Thursday for their only debate. Palin had an immediate and positive effect on the race when she was chosen, but that has dissipated over the past two weeks. She struggled through an interview with CBS anchor Katie Couric last week, and polls show rising unfavorable ratings, including among independent female voters. As a result, Palin faces a major test in the debate against the more experienced Biden.

The second presidential debate will have a town hall format, which makes combat between the two candidates more difficult. If the race stands essentially as it does today by the time of the third debate on Oct. 15, strategists predict a fierce and confrontational 90 minutes. By then it will become clear whether McCain made the right decision politically to suspend most campaign activities last week and return to Washington to get involved in the financial package negotiations. Aides hope that, if Congress passes a rescue package, McCain's actions will be seen as having contributed to the deal. More important, they hope an agreement will push the economy story off the front pages for a while.

Their hope is to keep things fluid for the next few weeks.

"You've got to get it over with and start having a normal campaign," one McCain adviser said. "I think you can't make any campaign judgments until this is over.

Murray, traveling with the Obama campaign, reported from North Carolina.