WASHINGTON - John McCain's once-buoyant campaign appears to have stalled now that Americans have big worries about the shaky U.S. economy.
On almost every front, it's been a bad few days for the Republican presidential nominee, whose heady boost in the polls after his surprise pick of Alaska Gov. Sarah Palin as his running mate appears to be levelling off.
McCain was believed to have enjoyed a five-point lead over Democratic rival Barack Obama just a few days ago. Now, some polls are suggesting Obama may be back in the lead. A Gallup survey released Wednesday has Obama at 47-45 over McCain.
McCain's image troubles grew worse Wednesday over remarks he made over a federal bailout for insurance giant American International Group.
The Federal Reserve pumped $85 billion into AIG just a day after McCain said he was opposed to such a costly helping hand.
"I didn't want to do that," a tense-looking McCain told ABC News on Wednesday, saying the government was forced into the bailout. "And I don't think anybody I know wanted to do that."
"But there are literally millions of people whose retirement, whose investment, whose insurance were at risk here. They were going to have their lives destroyed because of the greed and excess and corruption."
His campaign couldn't offer any examples of corruption at AIG.
Just a day earlier, McCain was adamant that no federal help should be forthcoming for AIG, noting that the Fed had refused to bail out Lehman Brothers, the 158-year-old financial institution that sought bankruptcy protection Monday.
"No, I do not believe that the American taxpayer should be on the hook for AIG, and I'm glad that Secretary (Henry) Paulson has apparently taken the same line," McCain had said in an interview with NBC.
"They're on their own. We cannot have the taxpayers bail out AIG or anybody else. This is something that we're going to have to work through."
McCain, who's been selling himself as a straight-talking maverick on the campaign trail, is on the hot seat on another economic front -- his sudden insistence that the financial industry is in desperate need of regulation.
The Arizona senator's new stance comes after voting consistently for years against regulation, just like the vast majority of his Republican colleagues.
"McCain has developed a reputation over the years as someone who was very disinclined to want to regulate, and in that sense he was not a maverick at all but in fact a very mainstream Republican," Paul Beck, political science professor at Ohio State University, said Wednesday.
"And now he's caught in a situation were there was insufficient regulation and the economy is in trouble. It puts him in a very bad position because there's a real credibility problem here."
"For someone who's really tried to be a straight talker, he's scrambling and the positions he's taken in the past are coming back to haunt him."
McCain has been roundly attacked not just for his flip-flops on economic issues but for statements branded as misleading -- on issues such as Obama's tax proposals, his aim to teach young children about avoiding sexual predators, and Palin's handling of public finances in Alaska.
Even Republican mastermind Karl Rove had a gentle rebuke for the McCain campaign, telling Fox News it "has gone one step too far, attributing to Obama things that are, you know, beyond the 100 per cent truth test."
He said the Obama campaign, however, was doing the same thing.
The McCain campaign seems to realize the economy is on everyone's mind.
In two new television ads released Wednesday, McCain asserted that he is the right leader to keep Americans' savings safe.
"I'll meet this financial crisis head on," he says in one ad. "Reform Wall Street. New rules for fairness and honesty. I won't tolerate a system that puts you and your family at risk. Your savings, your jobs -- I'll keep them safe."
But Beck says that as long as the economy continues to falter, Obama has the upper hand. Beck predicts that public opinion polls will soon show another dramatic turnaround in a march to the White House that has become a horse race.
"The polls were most certainly be affected -- it's already starting to happen," Beck said.
"We are through the Palin surge period and things are going to settle down a bit. She will still draw strong support from the Republican base, and she's been very successful on that front, but swing voters are beginning to have second thoughts about Palin."
"The bloom is off the rose, and McCain will have to deal with that reality now and the fallout from events that he cannot control -- like economic bad news."
