Candidates back aid for big banks

Both John McCain and Barack Obama grudgingly supported the Bush administration's plan to invest $250 billion in the nation's biggest banks, and cautioned that the executives who caused the problem shouldn't be rewarded.

McCain told supporters in Pennsylvania that the plan should only last until the banks are on a solid ground again.

"When that is accomplished, government will relinquish its interest in these private companies. We're going to get the government out of the business of bailouts and equity stakes and back in the business of responsible regulation," McCain said. "We will learn from this crisis to prevent the next one, with much stricter oversight. No more wild overleveraging, no more liabilities concealed from the public and from shareholders, no more bundling of assets to maximize profit by assuming insane risks. Those days are over on Wall Street."

Obama, who is off the campaign trail today preparing for Wednesday night's debate, issued a statement:

"The Treasury Department’s concept of investing money directly into struggling banks so they can lend money to families and businesses is the right one. But we must make sure this plan is implemented in a way that helps homeowners and does not enrich Wall Street CEOs at the taxpayers’ expense, something I have warned against from the first day of this financial crisis. Taxpayers who are now invested in Goldman Sachs should not be treated worse than when Warren Buffett invested in Goldman Sachs. Injecting capital into our financial institutions is essential to stabilizing our economy, but we must make sure we are not giving sweetheart, insider deals that shift the risk to taxpayers without giving them sufficient upside. And we must make sure that these institutions are helping homeowners stay in their homes, which includes abiding by a 90 day moratorium on foreclosures for families who are making a good faith effort to pay their mortgages. Finally, the plan appears to extend a broader set of guarantees to banks without requiring any additional regulation, which represents more of the same failed philosophy that got us into this mess.

“I will be studying the details of this deal to make sure we can advance the core concept while still protecting taxpayers and ensuring that CEOs are not being enriched on our dime.”