Image: John McCain
Carolyn Kaster  /  AP
Republican presidential candidate John McCain, and his wife Cindy McCain greet volunteers at his campaign headquarters in Arlington, Va. Sunday, Oct. 12.
updated 10/12/2008 7:53:38 PM ET 2008-10-12T23:53:38

Republican John McCain, his presidential hopes battered by chaos in the American economy, has just three weeks left to come up with a consistent campaign message to close the widening gap that separates him from Democrat Barack Obama.

The veteran Arizona senator and running mate Alaska Gov. Sarah Palin, having spent the last week in a largely fruitless effort to hinder Obama's rise in the polls by attacking him on character issues, appeared over the weekend to have shifted tactics yet again — trying to convince voters that they are best placed to lead the country out of its worst economic crisis in 80 years.

The U.S. economy, the dominant issue in the presidential campaign for weeks, has now become a voter obsession as the stock market fell nearly 20 percent last week alone and vital sources of credit remain frozen.

With retirement savings vanishing in the stock market plunge, tens of thousands of homeowners facing mortgage foreclosure and unemployment rising, McCain's campaign has handled the financial crisis unevenly — hard-pressed to shed associations with President George W. Bush and the blame that attaches to the incumbent Republicans with their support for limiting government's role in regulating markets.

McCain considers new proposal
Sen. Lindsey Graham, a South Carolina Republican and key McCain adviser, said on Sunday that the candidate was considering a new proposal to lower taxes for investors by cutting back the share the government takes from capital gains and dividends.

"It will be a very comprehensive approach to jump-start the economy by allowing capital to be formed easier in America by lowering taxes," Graham said on CBS television.

McCain already has laid out proposals to address the crisis, including a $300 billion plan for the federal government to buy distressed mortgages and renegotiate them at a reduced price for hard-pressed homeowners. He argues the move is necessary to take thousands of bad mortgages off the books to stabilize home values and restart credit flows. Critics say the plan would reward financial institutions that made the bad loans in the first place.

Obama, for his part, also has offered plans to address the fiscal crisis but nothing as sweeping or controversial as McCain's. On Friday, the Illinois senator announced a $900 million plan to temporarily extend an expiring tax break that lets small businesses write off investments up to $250,000.

Boost from the Clintons
Obama's fortunes got a further boost Sunday when former President Bill Clinton and his wife, Sen. Hillary Rodham Clinton, made their first joint campaign appearance together on the Illinois senator's behalf — setting aside hard feelings left over from the Democratic primary contest in which Obama outdistanced the former first lady in a bitter, extended race.

The Clintons introduced Obama's running mate, Delaware Sen. Joe Biden, at a rally Sunday in the working-class town of Scranton, Pennsylvania, a city that has taken on outsized symbolism for Democrats this year. It was Biden's birthplace and Hillary Clinton's father grew up and is buried there.

Pennsylvania is one of the few Democratic-leaning states where McCain is campaigning aggressively in hopes of putting it into his column on Election Day.

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Hillary Clinton was interrupted repeatedly by applause from the big crowd as she delivered one-liners attacking Bush and McCain. At one point she said Republicans viewed middle class Americans not as "fundamental, but ornamental" to the functioning of the U.S. economy.

Biden hammered McCain as the candidate who would only bring the country four more years of the Bush administration, dismissing both men as unable to deal with the failing economy.

"We need more than a brave soldier, we need a wise leader," Biden said after pointedly saying McCain had been "erratic" in his response to the U.S. financial crisis.

Preparations for last debate
McCain had no campaign appearances scheduled Sunday as he prepares for Wednesday night's third and final presidential debate which offers one of his best remaining chances to gain ground on Obama.

McCain vowed Sunday to "whip" Democratic rival Barack Obama's "you-know-what" when the two presidential candidates meet Wednesday in their final televised debate.

Addressing several dozen volunteers at his campaign headquarters outside Washington, McCain promised some of his signature "straight talk" about the state of the race. National and many battleground state polls have shown him trailing Obama amid the deepening market crisis.

"We're a couple points down, OK, nationally, but we're right in this game," McCain said to cheers. "The economy has hurt us a little bit in the last week or two, but in the last few days we've seen it come back up because they want experience, they want knowledge and they want vision. We'll give that to America."

McCain said he and running mate Sarah Palin would continue campaigning hard in the three weeks left before Election Day, in places like Ohio, Pennsylvania, New Mexico, Nevada and Colorado. The two planned a joint appearance Monday in Virginia, a Republican stronghold turned battleground this time.

"We're going to spend a lot of time and after I whip his you-know-what in this debate, we're going to be going out 24/7," McCain said. Palin was headed to a rally in southeast Ohio, a critical swing state where polls show the race to be a tossup.

Toned down rhetoric
The Clintons were taking to the campaign trail a day after McCain toned down his rhetoric against Obama, apparently concerned with angry outbursts from supporters at some of his rallies — and criticism that he had gone too far.

Obama acknowledged this shift.

"I appreciated his reminder that we can disagree while still being respectful of each other," Obama told thousands of supporters at the first of four outdoor rallies in Philadelphia. Police estimated he drew more than 60,000 people to the four events.

"Sen. McCain has served this country with honor," Obama said later. "He deserves our thanks for that."

McCain kept his speech at a rally in Davenport, Iowa, focused on the economy and his policy differences with Obama, a striking change from just days ago when his campaign redoubled its challenge to the Democratic nominee over his association with a former 1960s radical. McCain also claimed that American voters did not really know Obama and his "radical" views.

The tone at McCain's and Palin's events during the past week had been turning toward the sour as disappointed supporters see his presidential campaign lag against Obama.

Angry rhetoric at rallies
Angry Republicans had shouted "terrorist" and "off with his head" at the mention of Obama's connections to former Weather Underground member William Ayers, whose group bombed federal buildings in protest of the Vietnam War when Obama was a child. The two had worked together on community projects in Chicago, and Obama has denounced Ayers' violent past.

On Friday during a town hall-style meeting in Lakeville, Minnesota, a supporter told McCain that he feared what would happen if Obama were elected. McCain drew boos when he defended his rival as a "decent person and a person that you do not have to be scared of as president of the United States."

McCain returned to that note of civility on Saturday as his quandary became clearer: He needed to excite his party's base without inciting them, challenge Obama while being an honorable opponent, and find a game-changing strategy for his faltering campaign without crossing the line.

In a statement issued Saturday, Rep. John Lewis, a Georgia Democrat and veteran of the civil rights movement, charged that the negative tone of the Republican presidential campaign reminded him of the hateful atmosphere that segregationist Gov. George Wallace fostered in Alabama in the 1960s.

Lewis, who is black, accused McCain and Palin of "sowing the seeds of hatred and division, and there is no need for this hostility in our political discourse."

McCain on Saturday called Lewis' remarks "shocking and beyond the pale."

Late Saturday, Lewis said he was not trying to directly compare McCain or Palin to Wallace.

"My statement was a reminder to all Americans that toxic language can lead to destructive behavior," he said.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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