As noted in the previous post, I'm quite convinced that some drastic action needs to be taken to avoid a cascading and debilitating series of crises. But the more I look at this plan, the more wrongheaded it seems. But if I'm understanding this deal, the taxpayers are going to pony up close to a trillion dollars to take bad debts off the hands of financial institutions who were foolish enough to make the deals in the first place. And in exchange, I think the tax payers get nothing? Sebastian Mallaby makes the good point that this is radically different than the S&L Crisis RTC which was liquidating the assets of thrifts that had already gone belly up -- paid the ultimate price, as it were. And as the insurer on the accounts, the government inherited the assets anyway. It was just a matter of selling them off. But here the point is to take these bad debts off these companies' hands so they can go back to being profitable businesses. This is moral hazard on steroids if I'm understanding this right.

Also, according to the Journal, finance industry lobbyists are already giving orders to Republican hill staffers not to allow any meaningful reforms or protections for taxpayers. So, just the money. No strings attached.

House Republican staffers met with roughly 15 lobbyists Friday afternoon, whose message to lawmakers was clear: Don't load the legislation up with provisions not directly related to the crisis, or regulatory measures the industry has long opposed.

"We're opposed to adding provisions that will affect [or] undermine the deal substantively," said Scott Talbott, senior vice president of government affairs at the Financial Services Roundtable, whose members include the nation's largest banks, securities firms and insurers.

A deal killer for the group: a proposal that would grant bankruptcy judges new powers to lower the principal, interest rate or both on a mortgage as part of a bankruptcy proceeding.

Late Update: Mulling this more and listening to the insights in your emails, the key clearly is how much the government pays for these distressed assets. They may be bad debts. But that doesn't mean they have no value at all. Bought at the right prices and given time on the books -- which the government is uniquely in a position to allow them to do -- the government could even turn a profit on some of them. But the key is at what price they're bought and whose get bought. That seems like precisely the kind of process that requires oversight and accountability to make sure the taxpayer doesn't get fleeced.

Dancing on the Edge of the Abyss Update: Paul Krugman has a post up that I think tracks basically along the lines I've raised -- only from the viewpoint of someone who has a profound understanding of these things rather than no understanding at all. He says, no deal.

Yep, It's Crap Update: I can't seem to find any of the people who I respect thinking the bailout plan, as presented, is a good idea.

There are subjects I know a lot about and others I know very little about. And the high-wire financial mess we're currently in falls clearly into the latter category. But I know enough to be troubled that we appear ready to give upwards of a trillion dollars in unfettered and unreviewable spending authority to the ... let's face it, the Bush administration, the folks who did such a bang up job in Iraq and New Orleans.

This morning a friend told me it's like the Iraq War all over again -- Shock & Awe, followed by an occupation of Wall Street, and all with no exit plan.

In all seriousness, Paulson seems like a very able guy. And without a roadmap in hand, he appears at least to have avoided catastrophe so far. But let's take a moment to realize just how much money we're talking about.

It is probably inevitable in such cases that the public gets stuck with a lot of the bill for the recklessness and perhaps even criminality of the people who got us into this mess. Even if it is their 'fault', we (as a country and its citizens) are simply too bound up with the consequences of their actions to let them play out in an unfettered manner.

But we need both some orderly system of decision making and some conditions imposed on the people, and the industries, that brought us into the ditch.

Here's a note received today from one TPM Reader ...

The current proposal for the bailout -- $700 billion to be used however the administration chooses to use it -- should not be allowed to pass in its current form. This is the same administration that has mismanaged Iraq, DOJ, Katrina. Why can they be trusted to preside over this in a way that is even-handed and for the benefit of the taxpayers? As Krugman and Atrios have pointed out, if insolvency rather than liquidity is the real problem, then this may not even fix the problem. Even if there is some modest stimulus package appended to the bill, the bill will still be a bad idea if it gives such unprecedented and unchecked power to the Bush administration.

It would be great if you guys could lead a push -- like the anti-SS privatization one from a couple of years ago -- to impose limits and rules on the bailout. The Dean Baker post on your site is a good proposal and maybe it makes sense to press congressman to agree to elements of it, particularly the caps on executive comp which has gone completely out of control here. It also makes sense to regulate the CDS market -- $65 trillion in it, more than in banks, with no transparency.

Make those who are to be rescued agree to some conditions so that this will not happen again. Otherwise, this is basically giving Wall Streeters (who are to be fair friends with both parties) a lot of money for nothing in exchange.

We'll be publishing more of your emails. So please let us know your thoughts.

Bush asks Congress for $700 billion for Wall Street/Mortgage bailout.

John McCain: "Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation."

Late Update: Obviously, to rejigger that wonderful line, this is not excellent news for John McCain. If the Obama folks are smart -- and they are -- they'll ride this one all the way to the election. But among ourselves let's admit that you could only be surprised by this statement if you were willfully ignorant to what McCain and his key advisors believe. Remember, his top economics advisor is former Sen. Phil Gramm, the legislative architect of the banking and financial services deregulation that led to the current crisis. And his health care proposals are all off-the-rack Heritage Foundation-style initiatives based on the premise that people have too much, not too little insurance. The only thing jarring about the statement is the degree to which it has been overtaken by events as McCain now tries -- a la Palin the Earmark-Killer -- to rebrand himself as a Mr. Wall Street oversight and transparency when he's been pushing deregulation for 25 years.

Let me ask you a favor. It helps TPM bring you more breaking videos you want to see, costs you nothing, and takes only ten or fifteen seconds. Please take a moment, go to our TPMtv page at Youtube and subscribe by clicking on the yellow 'subscribe' button on the upper left.

So if I haven't already convinced you, please take a moment and go over to the TPMtv Youtube page and subscribe to our TPMtv channel so you won't miss a single episode.

Did John McCain just make his first edge toward that (hollow) apology that Joe Klein says he'll never accept?

(To be clear: Joe was referring to McCain's established pattern of engaging in sleazy or dishonest behavior knowing he can latter come back to the Washington bigs, moral hat in hand, for absolution.)

So after running the sleaziest and most dishonest campaign in modern presidential campaign history, now McCain 'regrets' the negativity.

From a longtime reader ...

A week ago, as the McCain campaign continued to drive the media narrative and consolidate its lead in the polls, you wrote:

"...I take it that their position now is that they're not going to get knocked off their game. Instead they're staying focused on the ground game in the dozen and a half states where they believe the race will be won or lost....So we're left to take it on faith that they know what they're doing, without having much way of seeing for ourselves."

It's a fair point. And though it's tempting now to dismiss the last few weeks as a rapidly-dissipating bounce, and to applaud the Obama campaign for sticking to its game plan, the truth is that we don't know much more about how the campaign is unfolding on the ground than we did a week ago. If the polls didn't tell the whole story then, they're not much more enlightening now.

With that in mind, it's worth paying attention to a little-noted development this week in Michigan. The Obama campaign filed suit in state court to block the GOP's "Lose your home, lose your vote" scheme, a plan to challenge the eligibility of voters whose homes have entered foreclosure - despite the fact that many remain resident in those homes.
It's a typical GOP disenfranchisement campaign, and it's nice to see the Obama folks taking a proactive position.

But the really interesting part of the filing is the effort by the Obama campaign to demonstrate, in a court of law, that this behavior is "part of a broader state and nationwide campaign by the Republican Party to suppress the vote." And, upping the ante, the filing alleges that "Defendant Republicans have a long history of engaging in coordinated, systematic campaigns to suppress and deny the right to vote of American
citizens. Those campaigns are often targeted at various racial groups, language minorities, or individuals of low or modest economic circumstances whom Defendant Republicans believe are unlikely to support them in political campaigns."

The filing is aimed at a particularly egregious and politically ill-advised initiative. Not only are the Republican claims here tendentious, but they're targeted at a sympathetic group - largely white, financially-struggling voters, caught up in the economic crisis.
But the suit invites the court to go a step further - to recognize a persistent pattern of egregious misconduct; to find that this is a local instance of a state and national campaign; and in so doing, to link this initiative with other, less politically toxic drives.

The court is more likely to rule narrowly than to recognize those claims in its decision. But by intervening directly in a local case, the Obama campaign is signaling that a national campaign to disenfranchise voters will receive a national response. And by reframing a technical debate over local election laws as a broader discussion of fundamental rights, the Obama campaign has already won. The GOP has long employed the chimerical notion of "voter fraud," and preyed upon unpopular groups
like students, non-Anglophone Americans and ex-felons. But they made a strategic miscalculation by going after homeowners suffering foreclosures. And by linking this effort at disenfranchisement to the others, the Obama campaign is going to make them pay.

(The filing is here.)

Anybody seen Bush lately?

After a day of gasps, guffaws and eyes rolled over John McCain's decision to reassign Spanish Prime Minister Zapatero to run an unnamed country in Latin America, it seems we are arriving at a rough consensus about what happened and what part of it matters.

As I posited earlier today, the most logical conclusion is that McCain simply didn't understand the question and tried to wing it. It may have been due to fatigue, lack of attention, confusion or simply an inability to penetrate the interviewer's fairly thick accent, or perhaps a combination of one or more of the above. It is only if you insist on the preposterous assumption that McCain fully understood and grasped what the interviewer was asking him (i.e., the position of McCain's foreign policy advisor Randy Scheunemann) that you have to conclude that McCain believes that Spain is a country in Latin America which may be bent on America's destruction.

In itself mishearing or misunderstanding a question isn't the worse thing in the world, though being too proud to ask for the question to be repeated and going with the assumption that the mystery leader must be some Hugo Chavez type character out of Woody Allen's Bananas does suggest a certain recklessness of character.

The McCain campaign might simply have said that he was on the phone and didn't understand. But they're obviously unwilling to do that since they've staked so much of his candidacy on his foreign policy chops.

In any case, a consensus appears to be emerging that the really shocking lapse was not the original gaffe but how the campaign chose to deal with it. Rather than copping to the goof, they decided to stick to the nonsensical statements and risk, should McCain win in November, significant damage to our relations with a major NATO ally. Coming to basically similar conclusions are Newsweek, Joe Klein in Time, Chris Orr at The New Republic and many others.

So to restate, I think the simplest explanation is that McCain didn't understand what he was being asked. And instead of trying to clarify, he assumed the interviewer, who had already asked him about Chavez and Castro, must be quizzing him on some other Latin American strongman who was up to no good. As so often with McCain, he tried to wing it. I think the available evidence is consistent which much less generous readings of the event. But this read is plausible. And Scheunemann, whose lack of experience in press work was painfully on display today, acted with characteristically knuckle-headed aggression and doubled-down on McCain's nonsensical statement.

And whatever the misunderstanding, let's face it. When a president or presidential nominees gets confused in an interview, appears to say that a European country is in the Western Hemisphere and inadvertently makes highly belligerent statements toward a major ally, that's a big problem.

(ed.note: For more on the Inane On Spain controversy, check out Americablog, where John Aravosis has been on the story all through the day.)

We've been bringing you the latest through the day. Now in today's episode of TPMtv, you can hear John McCain's Spain goof and the two reasons why the explanation from his top foreign policy adviser just doesn't add up ...

Full-size video at TPMtv.com.

Georgian President Saakashvili denies hiring Washington lobbyists ...

President Saakashvili has strongly denied that his administration was in any kind of "lobbying relations" with Randy Scheunemann, a foreign policy advisor of the Republican presidential candidate, John McCain.

He was asked about the matter at the BBC's HARDtalk, when President Saakashvili was speaking about the huge support Georgia had in the United States.

"We've been getting huge support from the U.S. administration," he said and added that this support was coming not only from President Bush and his administration, but also from the both presidential candidates in the United States.

When saying this, an anchor, Stephen Sackur, interrupted Saakashvili and asked him: "Nobody would deny it for one second, that you have fantastic PR in Washington and many supporters, some say that partly because you spend millions of dollars on lobbying and PR in Washington not least with Mr. McCain's chief foreign policy advisor [Randy Scheunemann], he has received lot of money in his strategy organization [Orion Strategies] from your government; so you do have PR friends, but when it comes to practicalities what have the Americans have actually done for you to stop the Russians doing what they want on your territory?"

"You've just sounded like Mr. Putin right now," Saakashvili responded with smile on his face. "What millions of dollars? What lobbyist?.. We do not have millions of money to spend for anything especially for lobbying."

Needless to say, Saakashvili had McCain's foreign policy Scheunemann on the payroll until quite recently. And he still retains Scheunemann's firm.

(ed.note: Special thanks to TPM Reader AR for the tip.)

Wow, Time's Michael Scherer might want to dial in on the Social Security policy debate a bit more thoroughly next time. Ouch. Not pretty. (He doesn't seem to know any of the backstory about privatization, private accounts, personal accounts, etc. ... Did I mention 'ouch'?

Ouch ... (from CNN) ...

Sarah Palin likes to tell voters around the country about how she "put the government checkbook online" in Alaska. On Thursday, Palin suggested she would take that same proposal to Washington.

"We're going to do a few new things also," she said at a rally in Cedar Rapids. "For instance, as Alaska's governor, I put the government's checkbook online so that people can see where their money's going. We'll bring that kind of transparency, that responsibility, and accountability back. We're going to bring that back to D.C."

There's just one problem with proposing to put the federal checkbook online - somebody's already done it. His name is Barack Obama.

It seems the Post's Karen DeYoung isn't buying Randy Scheunemann's line that McCain wasn't confused just hardcore (from an online chat this morning) ...

McCain seemed sort of foggy in the interview, much of which was about U.S. relations with Latin American baddies Hugo Chavez and Evo Morales. Then interviewer asked about Zapatero and McCain seemed to be winging it, appearing to think that Zapatero was the leader of someplace in Latin America and reciting the same rote answer as for the others about not meeting with leaders who don't support freedom and the U.S.

Meanwhile, Joe Klein thinks it's not such a hot idea to put "a chill in the relationship with one of our NATO allies simply because McCain misheard a question."

Meanwhile, Marc Ambinder gave Randy Scheunemann another bite at the apple after it became clear that McCain said precisely the opposite in April of what Scheunemann says he intended to say yesterday. Saith Schuenemann ...

In this week's interview, Senator McCain did not rule in or rule out a White House meeting with President Zapatero, a NATO ally. If elected, he will meet with a wide range of allies in a wide variety of venues but is not going to spell out scheduling and meeting location specifics in advance. He also is not going to make reckless promises to meet America's adversaries. It's called keeping youtr options open, unlike Senator Obama who has publically committed to meeting some of the world's worst dictators unconditionally in his first year in office.

So saying he might meet with Zapatero might amount to making "reckless promises to meet America's adversaries"? It's not easy being as deep in a hole as Randy is at the moment. But America's adversaries? He might want to take a glance back at the NATO charter, which of course commits the United States to treating any attack on Spain as an attack on America. He's really willing to create a diplomatic incident just to avoid admitting that McCain got confused about what he was being asked. On the other hand, I guess Randy's nonchalance about binding NATO treating obligations puts his insistence on getting Georgia into NATO into a rather different light.

For the moment I guess he's sticking to the line that McCain actually has Spain on probation as a potential member of the Axis of Evil 2.0. And on this US News has some helpful follow up.

Okay, a moment to take stock on the embarrassing McCain gaffe. As noted earlier, despite the fact that McCain repeatedly suggests that Spain is a country in Latin America, McCain's foreign policy advisor Randy Scheunemann, insists that McCain wasn't confused, knew exactly who Zapatero was and meant every word of what he said. So with the McCain campaign sticking to its guns, let's review the possibilities of what happened here.

Option #1: McCain is so addled he not only doesn't know who Zapatero is but doesn't even know where Spain is located.

Option #2: McCain was not confused but actually meant his very belligerent comments about Spain and the Zapatero government (Scheunemann's line).

Option #3: Through some mixture of confusion and inability to understand the interviewer's accent, McCain was confused about who he was talking about and decided to wing it, assuming that the person he was being asked about was some other left-wing strong man from Latin America and answering with the standard boilerplate about standing up to America's enemies.

So let's run through the options. I do think McCain's age and sharpness are real issues and legitimate campaign issues. But while I think it's possible that McCain's doesn't remember who 'Zapatero' is, I obviously don't believe that in a calm moment he wouldn't be able to locate Spain on a map. So let's rule out option one is a possible but unlikely option.

So what about option #2? It's true that the neocons around McCain really do not like Zapatero. There are several nonsensical reasons but it at least started with his position against the Iraq War -- and the fact that he shortcircuited right wing efforts to exploit the ghastly Madrid train bombings. So it is true that they don't like him. But this option isn't credible either for two and possible three reasons. First, in the exchange, McCain repeatedly refers to Spain as a country in Latin America. So if Randy really wants to stick to this explanation, he needs to explain why McCain thinks Spain is a country in Latin America, which I assume he doesn't want to do. You just can't have it both ways. Either he misunderstood at some level what he was being asked or he has a presidential disqualifying level of ignorance about geography. The second reason is that back in April McCain explicitly said that he wanted to move past earlier disagreements with Spain and said specifically that he wanted to Zapatero to visit him at the White House if he is elected president. So even if we set aside the geographical confusion, McCain's camp would need to explain why he's changed his policy 180 degrees since April. A possible third explanation is that McCain would not take such a confrontational stance toward a NATO ally. But let's be honest, I wouldn't put it past him. Still, one and two are dispositive.

So we're on to option #3. Some version of option #3 is the only credible answer. Whether it was because of ignorance, confusion or inability to understand what the interviewer was saying, McCain clearly didn't understand what he was being asked. And rather than stop and say, I didn't understand your question, could you restate it?, (Or, who are you referring to?) he decided to wing it and assumed he was being asked a question about another Latin American strong man bad guy. This is simply the only credible explanation that takes account of all the evidence. I think it's a generous read to conclude that the only issue was that McCain couldn't understand the interviewer's accent. But it's definitely possible. Even that, though, puts McCain in a pretty bad light.

Equally bad, Randy Scheunemann would rather further inflame Spanish-American relations by ridiculously insisting that McCain knew exactly what he saying than admit the obvious -- that he didn't understand the question. It wouldn't be that surprising. But given McCain has premised his whole campaign on foreign policy experience they've clearly decided it would simply be too damaging to admit he was either a) confused, b) ignorant or c) reckless enough to spout off aggressive remarks when he didn't even know who he was being asked about.

Jonathan Martin, who covers the Republican side/McCain campaign for The Politico takes a look at McCain's Zapatero gaffe and doesn't seem to be buying the McCain camp's explanation.

TPM Reader EM ...

Enough. John McCain should not get a free pass on this one. On a cynical level, can you imagine if this had been said by either Obama, Biden--or for that matter, Palin?

I'm astonished by the amount of rationalizing and excuses being put out there on this "gaffe." Yeah, I suppose the possibility of being confused by the line of questioning, the accent is plausible for you and me but for the potential POTUS--I don't think so. Furthermore, Spain was attacked by the same terrorist group that orchestrated 9/11. Does pulling the troops out of Iraq trump that? Honestly? Our relationship with this European ally is that precarious.

Scheunemann ratcheted up the bravado. I say we call them on it. He and his campaign have reminded us time and time again of his foreign expertise compared to Obama's. McCain needs to explain.

The Washington Post has gotten hold of McCain's Spain goof. And McCain advisor Randy Scheunemann has sent the Post an email suggesting that McCain knew exactly who Zapatero was and was simply repeating the neocon anti-Zapatero line.

Now, I was away Tuesday and Thursday, so I still want to come back to whether Scheunemann was working with bamboozler Amir Taheri on his made-up Obama-Iraq piece. So we'll get back to that.

But on this, nice try, Randy. I don't doubt that Scheunemann and his neocon pals still have it in for Zapatero for pulling his troops out of Iraq. I admit it is difficult to believe that McCain either doesn't know who Zapatero is or doesn't know which continent Spain is currently a part of. And we can question the wisdom of a major party presidential candidate suggesting that a major NATO ally might be part of his Axis of Evil -- along with Hugo Chavez. But Randy's attempted save here does not add up. If McCain knew who Zapatero was, why did he repeatedly refer to him as a Latin American leader? Spain is not in Latin America. I'm certain of it.

I mean, maybe McCain did know exactly who he was talking about and just got confused about Spain being a country in Latin America. But I'm not sure that's much better.

Read the transcript or listen to the interview. The most logical explanation of this gaffe is that McCain got asked about Zapatero right after being asked about Chavez, Castro and Morales. Not remembering who Zapatero was, he assumed he must be some other Latin American tinpot dictator and answered the question accordingly. We could be generous and assume he was just upping the ante on the normal neocon line. But by repeatedly referring to Spain as a country in Latin America, McCain just doesn't make that interpretation tenable for any fair-minded reader.

Face it, he got confused.

Late Update: We're getting a flood of good emails interpreting what happened here. The most generous interpretation we're hearing is that McCain couldn't understand what the interviewer was saying -- she's a native Spanish speaker speaking in an accented English, though she says repeatedly she's talking about Spain. Rather than ask her to clarify he decided to wing it, assuming she must be talking about some other Latin American bad guy. I think there's a good chance this is what happened. (I don't think that if you actually walked up to McCain today and asked him whether Spain is in Europe or Latin America that he wouldn't know. But on the fly he did seem to get confused.) But I don't think this puts him in a very good light. And, needless to say, this interpretation is entirely inconsistent with Scheunemann's suggestion that McCain knew exactly who he was talking about and just wanted to stick it to Zapatero. Whether he got confused about who Zapatero was or was too proud to admit he didn't understand the question, he still shot from the hip and insisted that Zapatero, the Prime Minister of a major NATO ally country, is from Latin America. He's not ready for prime time.

Well, we've heard the interview now. And John McCain either doesn't know who the Prime Minister of Spain is, thinks Spain is a country in Latin America, or possibly both.

In case, you haven't seen our updates from last night, yesterday John McCain was interviewed on the Florida affiliate of Spanish radio network Union Radio. And in the interview McCain appeared not to know who the Prime Minister of Spain was and assumed he was some anti-American leftist leader from South America.

After the interviewer presses him a couple times on the point and tries to focus him on the fact that Prime Minister Zapatero isn't from Mexico and isn't a drug lord either McCain comes back at her saying, "All I can tell you is that I have a clear record of working with leaders in the Hemisphere that are friends with us and standing up to those who are not. And that's judged on the basis of the importance of our relationship with Latin America and the entire region."

Then there's a moment of awkward pause before she says. "But what about Europe? I'm talking about the President of Spain."

McCain: "What about me, what?

Interviewer: "Are you willing to meet with him if you're elected president?"

McCain: "I am wiling to meet with any leader who is dedicated to the same principles and philosophy that we are for humans rights, democracy and freedom. And I will stand up to those who do not."

At this point, the interviewer gets tongue-tied presumably because she can't get over McCain not knowing what Spain is.

Spanish Prime Minister Zapatero on McCain not knowing who he is (from Time)...

As for Zapatero himself, the prime minister is apparently taking this latest attack to his ego with characteristic equilibrium. McCain may not know who Spain's leader is, but Zapatero promised to work with the new administration "whatever it is."

A final update of the evening on McCain's uber-gaffe.

There's some unclarity whether the interviewer was done by a Spanish reporter or a Spanish language reporter Caracol from 1260 in Miami. I suspect they may have had some joint arrangement since they both appear to claim it as their own exclusive. Or perhaps the local station in Miami is working as the affiliate of the Spanish radio network.

That doesn't change the underlying story. But TPM Reader RC points out that if you go to the Caracol1260 website and scroll down below the fold to the section of audio links on the left under the headline "Hoy por Hoy", these folks have their own version of the recording. They spliced the Spanish translations in differently. And in the way they did it, you can hear much more of McCain's actual English. It's still a bit difficult to hear McCain since the translator is speaking simultaneously. But you can hear most of what he says. It's pretty clear that McCain doesn't remember who Zapatero is. And he keeps referring to his approach to Latin America even after the interview keeps pointing that she's asking him a question a Spain, which is actually in Europe.

(ed.note: Another point about this version of the interview audio, Caracol seems to have completely dubbed out the interviewers voice in exchange for a translator speaking in Spanish. If you listen to the other version from the Spanish radio channel, it's clear that the original interview was entirely in English. The Caracol version also appears to cut portions of the the exchange. So we still need to hear the unaltered recording of the exchange.)

To recap, tonight we've been discussing Sen. McCain's bizarre interview in which he appeared not to know who Spanish Prime Minister Zapatero was and, in an effort to wing it, assumed he must be another left-wing, anti-American leader from Latin America. In the Spanish press analysis of the interview, at least, many seem uncertain whether McCain even knows where Spain is, though that strikes me as a bit excessive.

Just how this will get played in the American press will be interesting to see because it cuts to two of McCain's key vulnerabilities -- the first being his apparently rather shaky foreign policy experience if can't identify the leader of a major NATO ally and the second being what I guess we would call declining mental acuity.

Now, bear in mind that so far we've only been able to clearly hear the audio of the interview in the translations provided by the Spanish radio station that conducted the interview. But the interview, which was conducted entirely in English, was recorded. I'd assume that if this story gets any traction some media outlet here will prevail on the Spanish news organization to release the English language recording of the interview.

All of the Spanish language speakers I've heard from who've listened to the interview think there's no doubt that McCain just got confused and didn't know who Zapatero was or possibly didn't even know where Spain was. But again, in the released audio, you just hear the translator, with the original English sufficiently far in the background as to be largely inaudible. So we probably won't know just what happened until we hear the original.

Well, it doesn't appear to have registered in the American press yet. But the story keeps bubbling in the Spanish press about McCain's bizarre gaffe about the Spanish Prime Minister. Here's the front page cut out from the Spanish news channel that did the interview. They've talked to the interviewer now. Her take? McCain didn't know who Zapatero was ...

Late Update: So McCain is the candidate with the foreign policy experience ready to lead on day one. But he doesn't know who the leader of Spain is. He gets confused in an interview, apparently thinking Zapatero is someone from Latin America who is an enemy of the United States and manages to create a minor international incident.

Later Update: Here's another Spanish press reax. In Spain, there seem to be two lines of thinking. The great majority appear to think the McCain was simply confused and didn't know who Zapatero was -- something you might bone up on if you were about to do an interview with the Spanish press. The assumption seems to be that since he'd already been asked about Castro and Chavez that McCain assumed Zapatero must be some other Latin American bad guy. A small minority though think that McCain is simply committed to an anti-Spanish foreign policy since he's still angry about Spain pulling it's troops out of Iraq. Finally, a few of those who lean toward the first view speculate that McCain may have confused Zapatero with the Zapatista rebel group in Mexico.

Even Later Update: One representative reader response, from among many ...

I listened to the interview. The characterization is correct. I originally gave McCain the benefit of the doubt, thinking that he was just snubbing Zapatero (something that would be welcomed by the Spanish right). When I was there, there was a lot of agitation among Spanish conservatives because Zapatero was ignoring the country's relations with the U.S. and making overtures to more leftist countries in the Latin America--Cuba, Venezuela, Bolivia (all the countries mentioned in this interview before Spain). There was even a controversy because Zapatero sat down when the U.S. flag was passing by in a parade. I believe his excuse was "his legs were tired." So I figured McCain was giving the Zapatero the cold shoulder in the same manner as the Bush administration has done.

After listening to the interview, however, I agree with the characterization that McCain was unaware of our relations with Spain, or even the country's geographical and political position. When asked about meeting with Zapatero and the country's relationship with the U.S., McCain ignored the question and went into some boilerplate about America's friends and enemies and analyzing relations (think Palin and the Bush Doctrine). Then, he tried to transition his answer into more friendly territory, discussing President Calderon's government in Mexico. He never really addressed Spain, but pushed right into commenting about Mexico. The interviewer actually tried to redirect him several times (again, think Charlie Gibson and Palin), until she actually stated that she wasn't talking about Latin America anymore, but rather Europe. For whatever reason, McCain responded to this question by repeating what he said before about analyzing America's relationships with our friends and enemies.

Seriously, this was pretty bad.

We wanted to give you an update on the post below where we described Sen. McCain's latest gaffe in which he seemed to suggest that he might not be willing to meet with Spanish Prime Minster Zapatero because he is among those world leaders who want to harm America.

The story is already getting picked up pretty quickly in the Spanish press. And the way it's being interpreted in the Spanish press is that McCain got confused about the fact that Spain is a country in Europe, rather than a rogue state in Latin America.

Our review of the audio suggests the same conclusion. In the interview, McCain is asked about Hugo Chavez, the situation in Bolivia and then about Raul Castro. He responds to each of these with expected answers about standing up to America's enemies, etc. Then the interviewer switches gears and asks about Zapatero, the Spanish Prime Minister. And McCain replies -- very loose translation -- that he'll establish close relations with our friends and stand up to those who want to do us harm. The interviewer has a double take and seems to think McCain might be confused. So she asks it again. But McCain sticks to the same evasive answer.

This is obviously a story that's difficult to get a handle on because of multiple layers of translation and retranslation. So I would ask that those of you who are speak Spanish fluently to review this article in El Pais and the audio in the post below, and let us know any other information you find.

Did John McCain really just suggest that the Prime Minister of Spain might be one of America's enemies? One of those international leaders he'd refuse to meet with?

Does he want to liberate Spain too?

The passage in question is at the end of the interview linked here (with translation into Spanish) ...

McCain supporting Hillary Clinton backer Lady Lynn Forester de Rothschild, international financier who splits her time between homes in New York and London, says she can't support Obama because he's "an elitist" ...

In an interview with CNN this summer, Forester did not hide her distaste for eventual Democratic presidential nominee Barack Obama.

"This is a hard decision for me personally because frankly I don't like him," she said of Obama in an interview with CNN's Joe Johns. "I feel like he is an elitist. I feel like he has not given me reason to trust him."

Forester is the CEO of EL Rothschild, a holding company with businesses around the world. She is married to international banker Sir Evelyn de Rothschild. Forester is a member of the DNC's Democrats Abroad chapter and splits her time living in London and New York.

Sounds like a natural McCain supporter.

More of this the better. Can we arrange for Cruella de Ville's and Richie Rich's endorsement of McCain too? Even Endicott Billionson?

Presidential candidates usually have to wait until they're elected to start obstructing investigations into their own wrong-doing. But ready on day one as he is, John McCain and Sarah Palin are getting a jump on this front too. I'm not sure I've ever seen an instance of a president, let alone a presidential candidate, quite this nakedly doing everything in his power to shutdown an investigation. And look closely -- Palin herself has at this point entirely turned the obstruction over to the McCain campaign. They're even the ones who make the announcements. (I won't get into the battery of lawyers plumbers up in Alaska getting all the small fry to clam up and digging up dirt on all Palin's accusers.)

Meanwhile, the claim that the Obama camp has 'tainted' the trooper-gate investigation is truly risible. This investigation was well underway and already looking bad for Palin and her husband well before John McCain picked her as his running mate. (We know: we were already covering it.) What I do not think that many people know is that this investigation up in Alaska has actually been authorized and is being run by Republicans. They make up a majority in the state senate. The committee member overseeing the investigation happens to be a Democrat. But at any moment of their choosing, they could pull him off the case, overrule his decisions, or shut the investigation down entirely.

Palin's response to this -- to the question of how Obama could have tainted the investigation which is under the control of Alaska Republicans -- is to claim that there are actually a lot of Republicans in Alaska who oppose her. And that's true. But observing that a sizable number of officeholders of your own party think you're probably a crook too does not amount to an affirmative defense. Really, it doesn't.

The fall back defense, when claims about Obama's 'taint' fall flat, is that Palin's someone who 'shakes things up'. That's what she's done in Alaska and that's what she's going to do in Washington.

But a pattern of crony hiring and politicized firings of public officials all followed up by stonewalling and obstruction of justice really would not amount to 'shaking things up' in Washington. After eight years of President Bush, that's more like steady as she goes.

Ruth Marcus tries as hard as she can to balance it out but is finally forced to conclude that McCain is a liar and a disgrace.

Richard Cohen jumps waaaaaaaaaay off the tire swing.

I mean, this is betrayed lover counter-tire-swingism. Must read.

Kissinger, who is one of McCain's foreign policy advisors, is now openly supporting Obama's call for high level talks with Iran.

Let me get this straight. John McCain's top economic advisor, former Sen. Phil Gramm, is the guy who authored the deregulation law that most agree is the ultimate cause of today's financial meltdown. Tomorrow's and probably next week's too. But let's not get ahead of ourselves. John Thain, CEO of Merrill Lynch, which swirled into brokerage oblivion today, is one of McCain's top economic advisors too. And now McCain says he's going to clean up the mess by putting in tighter regulations and oversight even though he's always supported lax oversight and his top economics guy is the one who loosened the rules in the first place.

Down in the underbrush beneath Sarah Palin's forest of lies there's been this line that even if she was a big time earmarker that she still vetoed half a billion worth of earmarks as governor.

Well, not exactly.

Here's an interesting article by the AP's Brendan Farrington in which McCain gets quizzed on various of his lies. He admits some are lies but say it's okay. And in others, well ...

McCain cut off a question about the "Bridge to Nowhere," which Palin claims to have killed in Alaska even though Washington pulled back money for the project before she turned against it.

"The important thing is she's vetoed a half a billion dollars in earmark projects--far, far in excess of her predecessor and she's given money back to the taxpayers and she's cut their taxes, so I'm happy with her record," McCain said.

Post's Ignatius hops off the tire swing and suggests McCain is selling his soul to the devil.

I like to think I have some pride of place as prime online disseminator of Sarah Palin's endless list of lies. But Andrew Sullivan is giving me a run for my money.

US News: "John McCain's Journey from Maverick to Liar"

AP catches Palin and McCain lying about Obama's tax plan too.

As I noted below, the big press story of the campaign is shaping up to be how reporters are and will react to McCain's deliberate strategy of full-court-press lying. The corrupt, though normal, approach is for reporters to try to dig up whatever Obama exaggerations they can find to try to balance the coverage. If that doesn't work, then they will try to hang the charges on Democrats -- i.e., "what Democrats are calling 'lies'" etc. And of course using the dictionary term -- "lies" -- for repeated and intentional misstatements of fact is almost always forbidden.

But the lying is so extreme in this case that a few reporters are beginning to actually report the story accurately.

So keep an eye out for examples in both categories -- egregious refusals to identify McCain's lies properly and instances where reporters actually decide not to mince words and accurately report the story before them. If you find them, send them in and we'll start keeping a list.

Palin repeats the Bridge to Nowhere lie this morning in Colorado ...

You'll note that while Palin is continuing to restate the lie, there's a tone of defensiveness in her voice this morning, since they clearly know they've been caught.

Of all the shortcomings of the establishment press today, none is more central to the corruption of the profession than the decision to prioritize balance over accuracy. That corruption is visibly on display in the current coverage of the McCain campaign's policy of deliberate lies. And you won't find a better example than Cathleen Decker's piece in yesterday's LA Times.

Read into the article and you'll see numerous instances of McCain's repeated use of false claims and lies and one instance Decker is able to dig up of an Obama campaign claim that arguably leaves out some information.

But the conclusion and packaging of the article is that both candidates deceive equally and that they do so because it works. (There was another example, though not quite as egregious, by Jonathan Weismann last week in the Post.)

We hear a lot about the steep and perhaps terminal decline of the business model underlying daily print newspapers. But this corruption in the basic conception of the craft -- which is actually related to the economic decline -- gets discussed much less.

This is what gives liars a clear strategic advantage over non-liars. And it's an open question whether McCain's level of dishonesty turns out to be so great that it overwhelms reporters' unwillingness to report accurately on it.

The man most responsible for the financial services and banking deregulation that made today possible, fmr. Sen. Phil Gramm, is the man John McCain wants to put in charge of the whole economy.

Now Army Times finds another McCain lie.

Edsall ....

The McCain campaign, in running TV ads which defy prior political standards, is gambling that the traditional rules governing what is permissible in presidential contests -- as defined by the mainstream media -- can safely be discarded this year.

The normally cautious and even-handed Associated Press on Thursday declared, "Even in a political culture accustomed to truth-stretching, McCain's skirting of facts has stood out this week." The controversies have surrounded McCain television commercials and stump speeches asserting that Barack Obama "supports" comprehensive sex education in kindergarten, that Obama called Sarah Palin a "pig in lipstick," and that Palin stood firmly against the "bridge to nowhere" -- despite videotape evidence that the Alaskan governor provided support for the earmark before she opposed it.

So far, based on polling over the past two weeks, McCain's roll of the dice has paid off. Not only has McCain made substantial gains, pulling modestly ahead in most national polls, but his assaults on Obama appear to have damaged the Democratic Party as well, raising Republican hopes of minimizing House and Senate losses.

The Obama campaign has now clearly taken the leap into openly attacking John McCain for the series of lies and fraudulent statements he and his campaign have now told over the previous two weeks. The evidence is beyond question and even mainstream news organizations which place balance over accuracy in reportage have confirmed his deceptions. Presumably they will soon move to the obvious and more consequential corollary. If voters can't trust John McCain to tell the truth about even the most basic facts of the campaign, how can they trust him when he says he's going to bring change?

Obama raises $66 million in August.

Yesterday I asked what consequences John MccCain might face for repeated instances of lying if he were still in the Navy. The UCMJ covers official lies and, more generally, immoral conduct. But there's also the US Naval Academy Honor Concept. The USNA makes clear it's not a 'code', in that it's not a specific set of rules but a general statement of moral conduct. But in the more colloquial sense most of us understand, it's the Academy's honor code, the rules of conduct midshipman are supposed to live by and against which they are judged.

The first two lines of the Concept are ...

Midshipmen are persons of integrity: They stand for that which is right.

They tell the truth and ensure that the full truth is known. They do not lie.

As many reporters noticed, Gov. Palin dropped her "Bridge to Nowhere" lie from her stump speech during her trip to Alaska last week, presumably because too many locals knew about her actual role as a major supporter of the project. So I'd been wondering whether the line would return once she returned to the lower 48. Sure enough, today in Carson City, Nevada, she's back at it.