Sununu disagrees with McCain on fundamentals of economy

U.S. Sen. John Sununu: Senator's Office PhotoU.S. Sen. John Sununu (R-Waterville Valley) disagrees with his close friend, U.S. Sen. John McCain (R-Ariz.), who has been arguing that the foundation of the U.S. economy is sound.

"I think it's very difficult to make a statement about the fundamentals given the significant changes we've seen in the last couple of days," Sununu said on a conference call with reporters, but he added that steps are being taken to strengthen the financial market.

"The Federal Reserve and other central banks have taken the appropriate steps on liquidity," he said. "I think we have an interest rate environment that's going to be important and helpful in the recovery of the real estate market and I do think if we don't allow the tax rates to go back up we have tax rates in place that will, over time, encourage investment activity and longer-term economic growth."

Speaking at a rally in Jacksonville, Florida McCain said "the fundamentals of our economy are strong."

"Our economy, I think, is still -- the fundamentals of our economy are strong, but these are very, very difficult times,'' McCain said."I promise you, we will never put America in this position again. We will clean up Wall Street."

Sununu said the government should not bail out investment banks like Lehman Brothers, which has filed for bankruptcy.

"Neither Congress nor the Treasury should put taxpayers on the hook for bad decisions made by company executives and shareholders," Sununu said.

The state's junior U.S. senator also said the government should institute stronger oversight and adapt policies that would benefit small businesses.

Sununu said that his rival, former Gov. Jeanne Shaheen (D-Madbury), "is the last person the last person we need an economic crisis is someone like Jeanne Shaheen who's first step has always been to purpose a tax increase and raising taxes in a very weak economy would be the wrong step, absolutely the wrong step for New Hampshire small businesses for their employees and for the country."

Shaheen's campaign said Sununu has helped "put the fox in charge of the henhouse" when dealing with oversight of financial institutions.

"John Sununu has been in Congress for 12 years voting to put the fox in charge of the henhouse by easing regulation on massive Wall Street institutions and predatory lenders," said Kate Bedingfield, Shaheen's communications director. "We need a new direction that means real accountability and oversight that prevents this kind of crisis from undermining our economy."

The Shaheen campaign also questioned Sununu's role on the Senate Banking Committee.

"John Sununu sat on the banking committee in the Senate for five years while this crisis was developing and did nothing prevent it," Bedingfield said. "He has consistently voted to protect predatory lenders, including those who violate the Truth in Lending Act and sat back while the Bush administration gutted oversight of Wall Street. He is boasting about a 12-year record that has led to one of the greatest crises on Wall Street in decades."

UPDATE: “Jeanne Shaheen is distorting Senator Sununu’s record by citing an erroneous vote and procedural motions in an attempt to distract from her own failed proposal and lack of credibility in dealing with the home mortgage crisis," Stefani Zimmerman, Sununu's press secretary said. "Ms. Shaheen, who recently called for the expansion of Fannie Mae and Freddie Mac, completely lacks understanding of this critical issue- whereas in stark contrast, John Sununu, as early as 2000 was calling for greater regulations that would have protected the interest of taxpayers and prevented the collapse of these mortgage giants. Unfortunately, Jeanne Shaheen’s allies like Senator Chuck Shumer have blocked these reform efforts every step along the way."

Also on PolitickerNH.com:

-RELEASE: SUNUNU DISCUSSES CURRENT FINANCIAL CRISIS AND PLAN TO STRENGTHEN OUR ECONOMY

-The Direct Result of the George Bush and John Sununu Economic Agenda