(CNN) – Does John McCain recommend a spending freeze to help stabilize the economy, or want the government to purchase bad mortgages from struggling homeowners? Well, according to his answers during Tuesday night’s debate, both.

Early in the debate, McCain recommended that the federal government buy up bad mortgages from landowners and replace them with lower cost, fixed-rate mortgages, which he said would help keep Americans in their homes.

“I would order the Secretary of the Treasury to immediately buy up the bad home loan mortgages in America and renegotiate at the new value of the homes at the diminished value of the homes and let people make those, make the payments and stay in their homes,” McCain said. “Is it expensive? Yes.”

But later in the debate, when asked what sacrifices the American people would need to make to help revive the economy, McCain recommended a “spending freeze.” The Republican nominee said the government should cut wasteful programs and eliminate earmarks.

“We're going to have to tell the American people that spending is going to have to be cut in America,” McCain said. “And I recommend a spending freeze that except for defense, veterans affairs and some other vital programs, we'll just have to have an across the board freeze.”

Obama said America is in the worst financial crisis since the Great Depression .

NASHVILLE, Tennessee (CNN) – Barack Obama said America is in the worst financial crisis since the Great Depression as he began his second presidential debate with Sen. John McCain.

He blamed President Bush and McCain for the crisis, saying they had worked to "strip away regulation."

Neither candidate was willing to agree with moderator Tom Brokaw that the economy would necessarily get worse before it got better, with Obama insisting he was "confident about the American economy," but saying leadership from Washington was required, as was American cooperation with other countries.

Watch: Sen. McCain said he will stabalize home values

McCain said what happened in the economy "depends on what we do."

McCain proposed having the government buy up and renegotiate bad home loans to stabilize the property market. He admitted the plan would be expensive but said it was necessary.

In response to a question from Brokaw, McCain floated the names of billionaire investor Warren Buffett — an Obama supporter — and Meg Whitman, the former eBay executive who is one of his economic advisors, as a possible Treasury Secretary.

Obama agreed that "Warren would be a pretty good choice," but declined to go into specifics about who he would nominate.

Watch Tuesday's episode of CNN=Politics Daily, The Best Political Podcast from The Best Political Team.

(CNN) – Sens. John McCain and Barack Obama are set to square off in their second debate Tuesday night — but this time there’s a twist: both will take questions directly from voters, as surveys show the electorate overwhelmingly focused on the economy, and the crisis in the nation’s financial system.

In the latest episode of CNN=Politics Daily, Suzanne Malveaux previews Tuesday’s debate.

Even after the passage of the $700 billion Wall Street bailout plan, stock markets around the world continue to be roiled by frozen credit markets in the U.S. and abroad. Allan Chernoff takes a look at what McCain and Obama plan to do to calm the country’s troubled economy.

Finally, American Morning’s John Roberts fills you in on new CNN/Time Magazine/Opinion Research Corporation poll results in five battleground states and changes to CNN’s Electoral Map.

Click here to subscribe to CNN=Politics Daily.

A new poll shows Americans think the country is headed for a depression. (AP Photo)

(CNN) — A new national poll suggests that six in ten Americans think another depression is likely.

In a CNN/Opinion Research Corporation poll out Monday afternoon, 59 percent of those questioned say that its very or somewhat likely that another depression could occur in the United States. Four in ten Americans say it not likely another depression will occur.

Watch: Poll: Economic depression is likely

The country went through a decade long depression following the stock market crash of 1929, in which roughly one out of four workers were unemployed, banks failed across the country, and millions of ordinary Americans were temporarily homeless or unable to feed their families.

Eight in ten of those polled say things are going badly in the country today and 84 percent rate the economic conditions as poor.

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The Obama campaign released another Sunday that has economic themes.

(CNN) – With a month until Election Day, the Obama campaign is trying keep voters’ attention focused on their pocketbooks and retirement savings accounts.

In “This Year,” the latest in a string of Obama ads with economic themes, the Democratic nominee uses images of locked factory gates and anxiety on the floor of the New York Stock Exchange. “Erratic in a crisis. Out of touch on the economy,” the ad says as images of Sen. John McCain getting off an airplane and riding a golf cart appear on screen.

The commercial comes amid talk of McCain preparing to adopt a more aggressive strategy in the final month of the general election campaign, first reported Saturday in the Washington Post.

“Struggling families can’t turn the page on this economy,” the ad says.

The McCain campaign has not responded to CNN's request for comment about "This Year."

The new ad will begin airing Monday on national cable outlets, according to the Obama campaign.

(Full script after the jump)

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Sens. Biden, McCain, and Obama returned to Capitol Hill Wednesday night to vote on a revised bailout plan. The House is expected to take up the bailout again Friday. (Photo Credit: Getty Images)

WASHINGTON (CNN) - The Senate has approved the $700 billion financial rescue plan in a just two days after the bailout failed in the House.

The bailout was approved in a 74-25 vote. Both presidential candidates, Sens. Barack Obama, D-Illinois, and John McCain, R-Arizona, voted in favor, as did Democratic vice presidential candidate Sen. Joe Biden of Delaware.

"This has been a very difficult time for our country, but I'm very, very happy for this vote tonight," Majority Leader Harry Reid, D-Nevada, said after the vote. "It shows that when we work together we accomplish volumes."

The core of the Senate financial bailout bill is the Bush administration's original plan to buy troubled assets from banks, but the proposal includes a number of new provisions aimed at tax payers. The changes were intended to attract more votes from the House — especially from Republicans, two-thirds of whom voted against that version.

The House is expected to vote Friday, according to aides to Democratic leaders.

Full story

Sen. McCain's new television ad focuses on the economy as the nation faces a financial crisis.

(CNN) – John McCain decries partisanship in a new spot released Wednesday, pointing to battles between the two parties over the failure of a $700 billion bailout bill for the country’s troubled financial system.

“What a week,” McCain says as he looks directly at the camera in an ad that has a fireside feel. “Democrats blamed Republicans, Republicans blamed Democrats. We're the United States of America. It shouldn't take a crisis to pull us together.”

The Obama campaign fired back at McCain’s latest volley in the ad wars. “In the latest sign of his increasingly erratic campaign, John McCain is actually running an ad attacking behavior that he himself exhibited in blaming this financial crisis on Barack Obama,”Obama-Biden spokesman Hari Sevugan said in a statement released by the Obama campaign.

Since the onset of the crisis in the nation's credit markets early last week, a spate of campaign ads focused on economic issues have been released by the two campaigns and those allied with them.

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Gov. Palin met with fellow mothers of U.S. soldiers while campaigning in Philadelphia Sunday.

SEDONA, Arizona (CNN) — Sarah Palin on Tuesday called herself a “Joe-six pack American” and said that her family has lost $20,000 in the stock market because of the financial meltdown on Wall Street.

Palin made the comments in a radio interview with conservative talker Hugh Hewitt while taking a break from debate prep at John McCain’s ranch in Sedona.

“I know what Americans are going through there,” Palin said on the radio show. “And you know, even today, Todd and I are looking at what’s going on in the stock market, the relatively low number of investments that we have, looking at the hit that we’re taking, probably $20,000 dollars last week in his 401K plan that was hit.

“I’m thinking, ‘Geez, the rest of America, they’re facing the exact same thing that we are. We understand what the problems are.’”

Earlier: Palin takes a dig at Biden's age?

Hewitt asked Palin her reaction to the “extreme hostility” that she has faced from liberals.

“Oh, I think they’re just not used to someone coming in from the outside saying you know what? It’s time that a normal Joe six-pack American is finally represented in the position of vice presidency, and I think that that’s kind of taken some people off guard, and they’re out of sorts, and they’re ticked off about it,” she said.

WASHINGTON (CNN) – The Senate plans to vote on the $700 billion bank rescue plan Wednesday evening — two days after the House failed to pass it.

The bill adds provisions — include raising the FDIC insurance cap from $100,000 to $250,000 — and will be attached to an existing revenue bill that the House also rejected Monday, according to several Democratic leadership aides.

The vote is scheduled for after sundown, in observance of the Jewish holiday. Republican presidential nominee John McCain and Democratic nominee Barack Obama and his running mate Joe Biden confirmed that they would be present for the vote.

The bill also includes a "Mental Health Parity" provision, which would require health insurance companies to cover mental illness at parity with physical illness.

Democratic sources told CNN that they expect bipartisan support for the bill. Because tax bill must originate in the House, the Senate is attaching the rescue plan to a bill that deals with renewable energy tax incentives.

This would allow the Senate to vote before the House to approve a bailout bill.

More

The McCain campaign called Sen. Obama a hypocrite in a web video released Tuesday.

The Statement: In a Web video released Tuesday, September 30, the McCain campaign points out that Obama attacked McCain after McCain said repeatedly in mid September that the fundamentals of the economy are "strong." The video then uses a clip from an Obama speech in which Obama says, "We've got the long-term fundamentals that will really make sure this economy grows." The narrator says, "Strong fundamentals? Is Obama saying McCain's right? Or is Obama saying his own attacks are shameless? Either way, Obama's a hypocrite."

Get the facts!

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The Obama campaign launched a new ad Monday.

(CNN) – A day after the Dow Industrials index dropped nearly 800 points in reaction to the failure of the $700 billion bailout bill in the House of Representatives, economic issues are dominating the latest round of television ads in the presidential race.

The Obama campaign launched a new ad, “Same Path,” Monday. In the spot, Obama speaks directly to the public for nearly two minutes about the nation’s troubled economy and what Obama proposes to do about it.

“I know that that we can steer ourselves out of this crisis. But not by driving down the very same path,” Obama says. “On taxes, John McCain and I have very different ideas,” he also says before detailing changes to the tax code that he would push for as president in order to help small and startup businesses, middle class families, and senior citizens living on fixed incomes.

The ad will air in “key states” nationally, according to a statement issued by the Obama campaign Tuesday.

While the Obama camp’s new ad details changes to the tax code Obama would advocate for if elected, the Republican National Committee’s new ad seeks to portray Obama’s tax policies and spending proposals as a potential fatal blow to the struggling economy.

The 30-second spot, “Worse,” begins with images of Wall Street while an announcer asks, “Can it get any worse?” The ad suggests things can get worse if Obama wins the White House. “New taxes. New spending. New debt. Barack Obama’s plan: It will make the problem worse,” an announcer says in the ad. The RNC says that “Worse” will air in Wisconsin, Ohio, Michigan, Pennsylvania, Virginia and Indiana.”

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This is the first of a new audio slideshow series from the CNN Election Express bus. Through the rest of the campaign we will be exploring the issues facing small towns, big cities, and everything in between.

Pres. Bush made the case for his administration's financial bailout plan directly to the nation on live television Wednesday night.

WASHINGTON (CNN) — President Bush addressed the economic crisis, saying, "We're in the midst of a serious financial crisis, and the federal government is responding with decisive actions."

Watch: Bush explains the "rescue effort"

Bush pointed out that the collapse of several major lenders was rooted in subprime mortgage that thrived over the past decade.

He urged Congress to approve his administration's $700 billion bailout proposal to restore confidence in the market.

"I'm a strong believer in free enterprise so my natural instinct is to oppose gov intervention," he said. But, "these are not normal circumstances. The market is not functioning properly, there has been a widespread loss of confidence.

"Without immediate action by Congress, America can slip into a major panic."

Full story

Sens. Obama and McCain issued a rare joint statement Wednesday about the financial and economic challenges the country is facing.

(CNN) — Presidential hopefuls John McCain and Barack Obama issued a joint statement Wednesday night on the economic crisis stating "now is a time to come together — Democrats and Republicans — in a spirit of cooperation for the sake of the American people."

Released about 15 minutes before President Bush's scheduled televised address on the economy, the joint statement labeled Bush's proposed economic bailout plan as "flawed."

"The plan that has been submitted to Congress by the Bush Administration is flawed, but the effort to protect the American economy must not fail," the statement said.

In a separate statement, Obama outlined five principles he said were necessary for the proposal.

The principles included creating economic plan that helped "millions of families facing foreclosure" and not just Wall Street, creating "an independent, bipartisan board to ensure accountability and complete transparency" and protecting taxpayers by creating a economic plan that did not include earmarks.

"This plan cannot be a welfare program for CEOs whose greed and irresponsibility has contributed to this crisis," Obama's statement said.

Jim and Peggy Vinson

ABOARD THE ELECTION EXPRESS

BATESVILLE, Mississippi (CNN)– Whatever they end up doing in Washington about bailing out the Wall Street financial giants– and whatever John McCain and Barack Obama may say about it if it should come up in the debate Friday night– there’s only one word that concisely sums up what people around here are saying about the government’s rescue mission:

Unfair.

Batesville is a rural town of around 7,000 people, about half an hour’s drive from Oxford, where the debate will be held. Economic conditions here are, to put it kindly, not good. We’re staying in Batesville before heading over to Oxford for the event; in town I ran into Jim Vinson, the chief financial officer of the Tallahatchie Valley Electric Power Association.

Full Story

Jim and Peggy Vinson

ABOARD THE ELECTION EXPRESS

BATESVILLE, Mississippi (CNN)– Whatever they end up doing in Washington about bailing out the Wall Street financial giants– and whatever John McCain and Barack Obama may say about it if it should come up in the debate Friday night– there’s only one word that concisely sums up what people around here are saying about the government’s rescue mission:

Unfair.

Batesville is a rural town of around 7,000 people, about half an hour’s drive from Oxford, where the debate will be held. Economic conditions here are, to put it kindly, not good. We’re staying in Batesville before heading over to Oxford for the event; in town I ran into Jim Vinson, the chief financial officer of the Tallahatchie Valley Electric Power Association.

(If that word sounds vaguely familiar: yes, this is the part of northern Mississippi about which the great and haunting 1967 Bobbie Gentry hit, “Ode to Billie Joe,” was written: “. . .the day that Billie Joe McAllister jumped off the Tallahatchie bridge. . . .”)

Jim Vinson was with his wife, Peggy; she’s a teacher at the North Delta School in town. When I brought up the financial calamity on Wall Street, they looked at each other and he said: “I was just ranting a little bit about that."

“Why and how did we let it get so bad?” Mrs. Vinson said. “Everyone knew it was coming; as a teacher of economics at a high school in Mississippi, I saw it coming. So they knew it was coming, and they let it happen."

That, they said, is where the unfairness comes in. If an individual American does a sloppy job of handling his or her personal finances, then he or she loses everything. But if prestigious Wall Street financial giants do a sloppy job, the taxpayers are expected to bail them out– and the taxpayers are threatened that if they balk at the bailout, the entire economy will collapse.

“I’ll tell you one thing about the salary side of it,” Jim Vinson said. “If there is a bailout, then the compensation of the key executives at those companies should be taken down to zero. The bailout money shouldn’t go to any of them, that’s for sure.”

Did he think that was a harsh punishment for the Wall Street titans– taking their entire paychecks away?

“I’ll tell you what would happen if the place where I work found itself in the same situation– I’d be out and they’d be looking for a new CFO,” he said.

Peggy Vinson said: “All of us are going to be paying for the mistakes of individuals who took advantage of deregulation, of the rules being relaxed. But I tell my students that every market, no matter what, has to have rules that people follow and play fair."

Jim Vinson said that, as a man who works with numbers and has to make them balance, this is by far the worst national financial situation he has seen in his lifetime.

But, he said, his real fear is that it may be even more dire than that.

“Peggy’s dad is 81, and lived through the Great Depression," he said. “He sees a lot of similarities between what’s happening now and what happened then.”

I asked them if they believed that either of the presidential candidates who are coming to their part of Mississippi for the debate Friday night has a plan or a program that will quickly lead the nation out of this crisis.

“No,” he said.

“No,” she said.

Nelson Roe, from left, Crystall Brandfass and Paula Smith are feeling the economic crunch.

ABOARD THE ELECTION EXPRESS

CAMBRIDGE, Ohio (CNN) — There are moments — sometimes fleeting and quiet — that make you stop and consider anew just how much is at stake on that day in November when a new president will be elected.

And some of those moments carry not even a sliver of partisanship. Not a hint of anger or acrimony.

We had pulled into Cambridge, Ohio, for lunch. It was a sunny afternoon in the town of 13,000, with a farmers' market on the courthouse lawn across from the Advantage Bank building. The setting felt like a vintage postcard; the local newspaper, the Jeffersonian, featured stories about a "Bark in the Park" event for the dogs of Guernsey County, and an announcement of the cast for the Deersville Community Players' fall theatrical production, "A Wing and a Prayer."

Some staff members of the bank came outside, and we started talking about the campaign, and one of them — Paula Smith, 43, a loan processor — said:

"I hope the candidates ask themselves sometimes if they're being completely honest with us about everything they put on the table."

I asked her what she meant.

"All this bashing of each other — I hope when they lay their heads down at night, they think about that. Because there are a lot of us out here who are depending on whoever wins, and I hope that in the middle of all the things they're saying, they pause once in a while to think about that."

Full Story

Paulson called on Congress to move swiftly.

NEW YORK (CNNMoney.com) — Treasury Secretary Henry Paulson on Sunday called on Congress to move swiftly on the Bush administration's $700 billion proposal to bail out the financial system

"We need this to be clean and quick," Paulson said on ABC's "This Week."

President Bush asked Congress on Saturday for the authority to spend as much as $700 billion to purchase troubled mortgage assets and contain the financial crisis.

Full story

CINCINNATI, Ohio (CNN) Pulling up to the Election Express: Bobby Hilton, a pastor with a radio show show in Cincinnati. He says he was listening to CNN on his car radio, heard “Ballot Bowl” and decided to come look for us.

What are his listeners talking about? No mystery here.: the economy. Ohio’s unemployment is higher than the national average at 7.4 percent. “People are hurting”, he says and they want to hear more from the candidates.

Hilton is a Barack Obama supporter. He says he’s glad to hear Obama talk about helping Main Street. But, Hilton says, he still isn’t convinced he is hearing enough specifics from either candidate. What’s his reaction to the Wall Street crisis? “Shock”. But he says Cincinnati has been feeling the ripple effects of a weak economy for some time.

  

Garry Hogue plays the harmonica in Cambridge, OH

CAMBRIDGE, Ohio (CNN)  Cambridge is a small community about an hour from the West Virginia border. We were on our way from Pittsburgh to Cincinnati, so we decided to stop there for lunch.  

Whenever we roll into a small town we attract a lot of attention…a forty-five foot bus with CNN emblazoned on the side tends to catch the eye, so It's usually not hard to find people to talk to.  There was a farmers market going on in the small park at the front of the towns courthouse, so we chatted with a few vendors to see how business was.