Will candidates’ financial plans work? – CNN.com

(CNN) — In the wake of the country’s financial meltdown, Sens. Barack Obama and John McCain have been telling voters they’ll fix the economy while their opponent would only make it worse.

As the economy dominated voters’ concerns, McCain and Obama stepped up the political blame game and got more specific about how they would deal with the country’s financial problems.

The candidates’ focus on the economy comes during a week of roller coaster activity in the financial markets:

There was the collapse of U.S. investment bank Lehman Brothers, a Bank of America buyout of Merrill Lynch and a government bailout of insurer AIG. Then, President Bush on Saturday asked Congress for the authority to spend up to $700 billion to purchase troubled mortgage assets and get things under control.

To summarize:

McCain wants to fire the current SEC chief (who is leaving at the end of the Bush Administration anyway); set-up a Mortgage and Financial Institutions Trust to protect companies against bankruptcy; and set-up a commission to streamline government agencies. What’s missing? Funding.

Obama wants to pass a Homeowner and Financial Support Act to “provide funds to prevent catastrophic failures in the financial industry and help keep people in their homes”; a $50-billion emergency economic stimulus package to create a million jobs rebuilding infrastructure and schools, and assist local governments so they don’t have to cut services; and ease bankruptcy laws for individuals. Again, what’s missing? Funding.

For the most part, I obviously prefer Obama’s plan, since provides for jobs and education. I’m not sure I agree with easing the bankruptcy laws … the people who got mega-mortgages and now can’t afford to pay them have to pay some price for their stupidity. Somehow, allowing them to keep their McMansions doesn’t seem quite like the right way to do it.

When I was buying my current home, I bought a tiny little condo, because I wanted to make sure that I could afford to pay my mortgage no matter what. I wanted a 30-year fixed; and that’s what I got. So why should someone who makes less money than I do, but who bought a $400,000 home on an option-ARM get to keep their house?

Maybe that sounds cruel, but somewhere along the line, you’ve got to inject a little reality into the discussion.