FACTBOX: McCain, Obama react to Fannie and Freddie rescue

(Reuters) - Democrat Barack Obama called the U.S. government's takeover of mortgage finance companies Fannie Mae and Freddie Mac a necessary move, and his Republican presidential rival John McCain views it as an good step but wants eventual privatization, advisers said.

The U.S. Treasury Department plan announced on Sunday would place the two government-sponsored enterprises into federal conservatorship. Fannie Mae and Freddie Mac own or guarantee almost half of the country's $12 trillion in outstanding home mortgage debt.

Below are responses on Sunday from Obama, his vice presidential running mate Sen. Joe Biden, and McCain's campaign:

DEMOCRATIC NOMINEE SEN. BARACK OBAMA OF ILLINOIS:

"Given the substantial role that Fannie Mae and Freddie Mac play in our housing system, I believe that some form of intervention is necessary to prevent a larger and deeper crisis throughout our entire economy," Obama said in a statement.

"I will be reviewing the details of the Treasury plan and monitoring its impact to determine whether it achieves the key benchmarks I believe are necessary to address this crisis."

He said any plan needed to focus on strengthening the economy, helping struggling homeowners, and protecting taxpayers. The plan must also make clear to investors that they are not putting money in a risk-free proposition.

DEMOCRATIC VICE PRESIDENTIAL NOMINEE SEN. JOE BIDEN OF

DELAWARE, ON NBC'S MEET THE PRESS:

"It's not an official reorganization. It will be left to the next administration and Congress to make those judgments."

REPUBLICAN NOMINEE SEN. JOHN MCCAIN OF ARIZONA'S SENIOR

ECONOMIC ADVISER, NANCY PFOTENHAUER, ON CNN'S LATE EDITION

"Fannie and Freddie are an example of crony capitalism. I mean, basically these entities were set up, they were given the upside, the return, but not the risk. The taxpayers bore the risk."

"They would use their lobbying power to reinforce their entrenchment and what we have seen is the result of that. And so I think politicians in both parties, if they voted for entrenching these powers, have to answer to that.

"Senator McCain thinks this is a step in the right direction and we need to protect the taxpayers and need to never allow this to happen again."

MCCAIN CHIEF ECONOMIC ADVISER DOUGLAS HOLTZ-EAKIN, TO

REUTERS:

"In future the long-term reforms are to scale down Fannie and Freddie so their size is no longer a threat. And then privatize them. Get them off the taxpayer's books entirely."

(Compiled by Randall Mikkelsen, additional reporting by Nancy Waitz, Deborah Charles and Jason Szep, editing by Jackie Frank)