CHARLOTTE, North Carolina (Reuters) - Democratic presidential candidate Barack Obama on Sunday called the $700 billion price tag for a financial market bailout “staggering” and said the final product must protect U.S. taxpayers and include a commitment to new regulatory reforms.
At a rally in downtown Charlotte, North Carolina, Obama laid the blame for the Wall Street crisis on Republican economic policies favored by John McCain, his rival in the November 4 presidential election.
“We’re now seeing the disastrous consequences of this philosophy all around us -- on Wall Street as well as Main Street,” Obama told the crowd estimated at about 20,000.
“And yet Senator McCain, who candidly admitted not long ago that he doesn’t know as much about economics as he should, wants to keep going down the same, disastrous path,” the Illinois senator said.
Negotiations over the unprecedented $700 billion bailout opened on Sunday between Congress and the administration of President George W. Bush.
The sweeping proposal would have the Treasury buy up bad mortgage-related debts from financial institutions, including U.S. subsidiaries of foreign banks, to try to stem the worst financial storm since the Great Depression.
“As of now, the Bush administration has only offered a concept with a staggering price tag, not a plan. Even if the U.S. Treasury recovers some or most of its investment over time, this initial outlay of up to $700 billion is sobering,” Obama said.
“And in return for their support, the American people must be assured that the deal reflects the basic principles of transparency, fairness, and reform,” he said.
Obama said any final package must ensure that taxpayers and homeowners were protected. He said it should include a global response and a commitment to broad regulatory reforms that would prevent another crisis.
In separate interviews on financial cable TV channel CNBC, Obama and McCain both called for independent oversight of the financial rescue.
“I think we have to have oversight. I don’t think it can be a blank check,” Obama said. “We have to make sure that there’s some accountability mechanism in it.”
McCain also said the proposed bailout should set limits on leaders of financial institutions rescued by the government.
“No CEO of any corporation or business that is bailed out by us, that is rescued by American tax dollars, should receive any more than the highest paid person in the federal government,” McCain said.
Aides to Obama said he had spoken to Treasury Secretary Henry Paulson on Saturday and to congressional leaders including House Speaker Nancy Pelosi of California and Senate Democratic leader Harry Reid of Nevada, as well as New York Sen. Hillary Clinton and former President Bill Clinton over the weekend.
Obama has delayed his own proposal for reform until the details of the package are agreed upon. He criticized McCain’s approach on Saturday, saying the Arizona senator’s fondness for deregulation would put at risk retirement funds in Social Security and the health care plans of many Americans.
McCain addressed a convention of the National Guard in Baltimore on Sunday, largely talking about the war in Iraq and mentioning the financial crisis only briefly.
He said he has proposed a “plan for comprehensive reform of the broken institutions that allowed this crisis to become a grave threat to our economy. At the center of the plan is the principle that we must keep people in their homes and safe guard the life savings of all Americans by protecting our financial system and capital markets.”
The visit to North Carolina is Obama’s third in the general election campaign. The state is traditionally a Republican stronghold in presidential elections, but Obama has tried to make it competitive this year.
Additional reporting by Ellen Wulfhorst in Baltimore; editing by Cynthia Osterman