US Election: Barack Obama and Mccain Lock Horns Over Wall Street Crisis

Barack Obama and John McCain were fighting to achieve a decisive advantage on the Wall Street meltdown yesterday, a critical campaign moment that could determine the outcome of the White House election.

Obama, at a rally in Colorado, sought to exploit what his team sees as a comment that could be potentially fatal to McCain's presidential chances: the Republican candidate's claim on Monday that the economy is "fundamentally strong". It is one likely to be played over and over by the Obama campaign in television ads.

The Republican presidential candidate backtracked yesterday, conscious that his remark was at odds with the experience of many Americans suffering from job losses, rising prices and the mortgage crisis.

Forced on the defensive for the first time since the arrival of Sarah Palin as his running mate re-energized his campaign last month, McCain did a media blitz, appearing on six morning television shows to say that he meant not that the American economy was strong, but that American workers were. "I was talking about the fundamentals of America, which is the workers, their productivity, their innovation, their incredible performance for many, many years," McCain said.

The Republican candidate, adopting a populist line, put the blame for the ailing economy on the "excess and greed" of Wall Street, which had "betrayed" the American working class.

Obama, campaigning in Golden, Colorado, ridiculed McCain's explanation, saying McCain's team had "sent him back out to clean up his remarks ... but McCain meant what he said the first time".

Obama said the election of McCain would mean a continuation of the economic philosophy pursued over the past eight years by President George Bush.

Despite Bush having presided over the economic downturn, Obama has failed to establish a clear lead over McCain on the economy. McCain, enjoying a poll bounce as a result of Palin's popularity, has a lead in some of the battleground states, while Obama has only a narrow lead in others, often smaller than those held by the failed Democratic candidates John Kerry in 2004 and Al Gore in 2000.