Candidates respond to voters economic fears

SOUTH BEND, Indiana (Reuters) - Facing job losses, rising mortgage rates and higher gasoline prices, U.S. voters in 2008 want their next president above all to listen to their anger and fix the economy.

As the U.S. economy sinks into a possible recession, all three top White House contenders, Republican John McCain and Democrats Barack Obama and Hillary Clinton, say they speak for middle class voters whose real income has stagnated for years and has begun to decline while the very rich get richer.

In a recent CBS/New York Times poll, 81 percent of voters said the country was on the wrong track, an unprecedented figure. Seventy-eight percent said things were worse than five years ago.

The candidates are echoing the views of voters like, Marvin Kline, 61, who feels a privileged few are benefiting while the middle class struggles.

Talking to Obama over orange juice at the Sunrise Cafe in South Bend, Indiana, Kline told of being laid off from his job of nearly 40 years at a foundry. Two years ago, the plant closed and moved overseas and Kline now lives off his pension.

“These plants have gone and this happens every day, and all of it is corporate greed -- to see how much money you can make off the backs of the American people,” he said. “When is this going to stop?”

A sense that there is unfairness is not limited to those who have lost jobs. Mary Magargee, a 63-year-old teacher who attended an Obama rally in Malvern, Pennsylvania, on Wednesday, said she found it shocking to learn of large pay packages for oil executives as Americans pay record-high prices for fuel.

“It’s unconscionable that they’re making all that money and people are paying almost $4 a gallon for gasoline,” she said.

Historically, when economic times are hard, the party holding the White House has an uphill fight to retain control.

McCain, the presumptive Republican nominee, must find a way to respond to voter anger without totally divorcing himself from Republicans who still support President George W. Bush.

Clinton and Obama have no such problem.

“Under George Bush, we’ve seen tax cuts for the wealthiest Americans who don’t need them and didn’t ask for them,” Obama, an Illinois senator, said in Gary, Indiana. “We’ve been extending a hand to Wall Street, but not lifting a finger for Main Street.”

Obama, who would be the first black president, and Clinton, who would be the first woman to win the White House, are vying to be their party’s nominee to run against McCain in November.

Clinton was the first of the three to strike a populist note, pledging to fight for the interests of truckers, auto workers and waitresses.

BOXING GLOVES

At a General Motors factory in Lordstown, Ohio, in February, Clinton held up a pair of boxing gloves to show she was tough enough to take on Wall Street and corporate America.

“We’ll take on the oil companies and harness their record profits to create millions of clean energy jobs, high-wage jobs you can raise a family on,” the New York senator said. “We’ll take on the credit card companies so that you and your families aren’t drowning in debt.”

Both Democrats would roll back the Bush tax cuts on the wealthiest Americans and are pledging tougher scrutiny of free trade agreements.

They also favor a more interventionist approach to the mortgage crisis than McCain, who has said he is wary of having the government “bail out and reward those who act irresponsibly,” whether they are bankers or people who took out excessively large mortgages to buy homes.

McCain on Thursday offered a plan to help homeowners caught up in the mortgage crisis obtain more manageable loans.

Democrats believe McCain is vulnerable on the economy and have hammered him by linking him to Bush.

One of the Arizona senator’s top economic themes is a promise to rid the budget of wasteful, special project spending, which he says often serves the interests of lobbyists rather than the public. He has joined Clinton and Obama in criticizing high compensation for CEOs, especially those whose firms were at the center of the financial and housing crises.

“I think it is outrageous when someone who is the head of Bear Stearns cashes in millions and millions of dollars in stocks,” McCain said. “I think it is unconscionable when the guy who is the head of Countrywide and his co-conspirators make huge amounts of money when Americans face the threat of losing their homes.”

(Editing by Alan Elsner and Eric Beech)