WASHINGTON-On the presidential campaign trail, Sen. John McCain's financial services agenda has hardly been front-and-center.

After months of near silence on the housing crisis, the Arizona Republican raised the issue in March, yet he offered few specifics and downplayed the need for government intervention. He shifted gears two weeks later, backing government-aided workouts in a twist on a plan first championed by congressional Democrats.

Douglas Holtz-Eakin, the chief economic adviser to the presumptive Republican nominee, said McCain believes it is important to wait until the credit turmoil is better understood before committing government resources.

As the crisis unraveled, "he always said, Let's watch, let's monitor, let's just see what this is going to be like,'" Holtz-Eakin, a former Congressional Budget Office director and economic adviser to President Bush, told American Banker in an interview last week.

"Quite frankly, we still don't know. There's still some discussion about what the depth of the housing crisis will be. Monitoring is the right thing to do in these circumstances," Holtz-Eakin said.

Whether as a result of caution or a focus on other issues, McCain's financial services platform is less detailed than that of Sen. Barack Obama, the presumptive Democratic nominee.

McCain "believes there is a role for the government, [but] he demands that the government be judicious in its use of taxpayers' money," Holtz-Eakin said. And while Obama has said he wants tax cuts aimed at the middle class, McCain has indicated he favors tax cuts and a less intrusive government across-the-board.

The Republican candidate has said he would like to create a Justice Department task force to investigate potential mortgage abuses and help state attorneys general in their investigations of lending practices.

McCain also would expand the government's ability to guarantee student loans, because the credit crunch has reduced such financing.

According to Holtz-Eakin, McCain opposes government programs to help consumers trying to buy homes out of foreclosure-programs generally seen as a tool for affordable housing and for avoiding a buildup of vacant properties-because they could wind up encouraging foreclosures.

On the trail, the campaign has offered a few more clues, though with little specificity. McCain opposes the reduction of down-payment requirements for government-backed loans, and he has said he would remove certain tax and accounting obstacles for financial institutions to raise more capital, though he has not said which obstacles.

In the interview, Holtz-Eakin called for increased transparency in the securitization industry. For his part, McCain supports reform of financial regulation, but Holtz-Eakin said the Treasury Department's recent blueprint for revamping the agencies was not "perfect by any means."

His positions contrast with the extensive consumer-protection proposals that have been offered by Obama, as well as with McCain campaign's more detailed proposals in the areas of energy and tax policy.

Holtz-Eakin noted that foreclosures have spiked in only some states, but issues such as energy have an effect nationwide. "Obama puts forward broad use of money that doesn't target it very well," he commented.

Foreclosure is "an important problem," but "like many problems, it has places of targeted importance, and you try to have policies that are targeted as a result," the adviser said. "Gasoline is everywhere. Fear of losing a job is everywhere. Accordingly, you have broader solutions."

Holtz-Eakin said Sen. McCain's "Home plan" would help roughly as many borrowers as legislative proposals put forward by Rep. Barney Frank (D-Mass.), and Sen. Chris Dodd (D-Conn.). (The McCain plan seeks to help 300,000 to 500,000 borrowers; the Congressional Budget Office estimates the Frank-Dodd plan would help about 500,000.)

Similar in some ways to the Frank-Dodd legislative approach, McCain's plan would expand the Federal Housing Administration's power to move troubled borrowers into better loans, and it would force lenders to write down the original loans by 10%. (Frank's bill calls for a 15% haircut on affected loans; Dodd's calls for 13%.)

"I find it ironic that somehow" McCain "was viewed as either late" to the debate "or anything else, because he's ended up with a plan that's just as generous as Barney Frank," Holtz-Eakin said.

He highlighted one of the key differences in the plans. Under the Democratic legislation, lenders would choose which loans to process through the FHA program, but McCain's plan would put that power in the borrower's hands.

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