WaMu failure raises the stakes even higher

Both major-party presidential candidates, in Washington on the proposed Wall Street bailout and perhaps headed to Mississippi for their first debate tonight, have weighed in on the latest sign of how bad the financial crisis is -- the federal takeover Thursday night of Washington Mutual, the largest bank failure in US history.

"The government-brokered sale of Washington Mutual is the latest sign of the perilous situation facing our financial system and our economy. Although Americans with deposits at Washington Mutual should rest assured that they are safe under this arrangement, the failures of our financial institutions threaten economic instability, jobs, and the incomes of American families. This is a time to rise above politics for the good of the country. We cannot risk an economic catastrophe. This is not a Democratic problem or a Republican problem – this is an American problem. Now, we must find an American solution," Democrat Barack Obama said in his statement.

Republican John McCain issued this statement: "Today's financial crisis threatens all Americans and the sale of Washington Mutual is just the latest indicator of the stresses in our financial markets that threaten to cut off the credit needed by our families, businesses, and state and local governments. I am committed to working with all parties of good faith in both houses of Congress, the Administration, and among Democrats and Republicans to reach an agreement to stabilize our financial markets. We can do so in a timely and effective fashion while protecting the taxpayer from excessive demands on their strained checkbooks. It is our obligation to restore the confidence of Americans in these valuable institutions, and demonstrate to taxpayers that Washington will be capable of addressing great national problems."

McCain's camp also issued a memo Thursday night disputing reports -- and accusations from Democrats -- that McCain torpedoed a tentative bailout deal on Thursday:

"Despite today's news reports, there never existed a 'deal,' but merely a proposal offered by a small, select group of Members of Congress. As of right now, there exists only a series of principles, including greater oversight and measures to address CEO pay. However, these principles do not enjoy a consensus in Congress.

"At today's cabinet meeting, John McCain did not attack any proposal or endorse any plan. John McCain simply urged that for any proposal to enjoy the confidence of the American people, stressing that all sides would have to cooperate and build a bipartisan consensus for a solution that protects taxpayers.

"However, the Democrats allowed Senator Obama to run their side of the meeting. That did not work as the meeting quickly devolved into a contentious shouting match that did not seek to craft a bipartisan solution.

"At this moment, the plan that has been put forth by the Administration does not enjoy the confidence of the American people as it will not protect that taxpayers and will sacrifice Main Street in favor of Wall Street.

"The bottom line is that as of tonight, there are not enough Republican or Democrat votes for the current plan. However, we are still optimistic that a bipartisan solution will be found. Republicans and Democrats want a deal that will protect the taxpayers."