McCain vows to deal with severe economic crisis

By Tim Gaynor

PRESCOTT, Arizona (Reuters) - Republican presidential candidate John McCain said on Saturday he would not underestimate the severity of the ongoing U.S. economic crisis and would keep open all options to deal with it.

"When Alan Greenspan says this is the worst crisis since World War II, we have a major challenge and we should never underestimate it, nor exhaust all the measures that we need to put into effect," McCain said, referring to the former Federal Reserve chairman.

The economy has become increasingly important in the presidential campaign, surpassing the Iraq war as the top concern of voters heading into the November election.

A protracted downturn could bode ill for the Arizona senator, whom Democrats are trying to taint with allegiance to polices of President George W. Bush.

McCain, who will run in November against Democrat Barack Obama or Hillary Clinton, spoke about the economy a day after a bleak report on jobs convinced many analysts the economy was in recession. The government report showed U.S. employers cut payrolls in March for a third month in a row and the jobless rate jumped to a 2-1/2-year high of 5.1 percent.

McCain told reporters he would oppose any big government bailouts, saying they had not worked in the past and would not work in the future. But he expressed support for the Senate's economic stimulus package.

"We have got to restore confidence on the part of the American consumer to invest, to save, to do the things that make our economy run," the Arizona Republican said.

"We have got to find the floor on the cost of houses. When we find the floor, then there will be people who will come in and purchase some of these at bargain rates," he said.