Debate highlights stark differences

updated 20 minutes ago

Debate highlights stark differences

Squaring off in the second of three debates, Barack Obama and John McCain drew sharp differences over the origin of domestic and international problems -- and how to tackle them. Obama tied McCain to President Bush on Iraq and economic deregulation, while McCain painted Obama as overly reliant on government and himself as a "steady hand at the tiller." developing story

(CNN) -- Sens. John McCain and Barack Obama went head-to-head on the economy, domestic policy and foreign affairs as they faced off in their second presidential debate.

Sen. Barack Obama challenged Sen. John McCain's views on Iraq.

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The debate was set up like a town hall meeting, and the audience was made up of undecided voters.

The candidates spoke directly to each other at times, but at other times they spoke as if their opponent were not in the room.

The debate over foreign policy boiled down to who has the better judgment.

McCain said he knows how to handle foreign affairs and questioned Obama's ability to do so.

"My judgment is something that I think I have a record to stand on," McCain said.

McCain said the "challenge" facing a president considering using military force "is to know when to go in and when not."

Obama questioned McCain's judgment in
supporting the invasion of Iraq.

"When Sen. McCain was cheerleading the president to go into Iraq, he suggested it was going to be quick and easy -- we would be greeted as liberators. That was the wrong judgment," he said.

Obama vowed to get Osama bin Laden and defeat al Qaeda.

"We will kill bin Laden, we will crush al Qaeda," he said.

McCain responded in equally strong terms: "I'll get him. I know how to get him. But I am not going to telegraph my punches as Sen. Obama did."

McCain and Obama seemed to agree that there were situations when the United States should be willing to use force to stop a humanitarian crisis, even when America was not directly threatened.

Earlier, Obama said the country has a "moral commitment as well as an economic imperative" to address the health care problem.

The Illinois senator said health care is a "crushing burden" for small businesses and is "breaking family budgets."

Obama and McCain both proposed computerizing medical records to reduce costs and limit errors.

McCain argued that Obama's plan included fines for small businesses that did not insure their employees, while his was based on "choice" rather than "mandates."

Obama said health care was a "right," while McCain said it was a "responsibility."

Obama's health care plan includes the creation of a national health insurance program for individuals who do not have employer-provided health care and who do not qualify for other existing federal programs. His plan does not mandate individual coverage for all Americans, but requires coverage for all children.

McCain opposes federally mandated universal coverage. He believes competition will improve the quality of health insurance.

McCain says he would reform the tax code to offer choices beyond employee-based health insurance coverage. Under the plan, all taxpayers would receive a direct refundable tax credit of $2,500 for individuals and $5,000 for families

During the first half of the debate, the candidates focused on their plans to fix the economy.

McCain said the system in Washington "cries out for bipartisanship" and pushed his record as a reformer.

He and Obama were asked how voters could trust either one of them to fix the economy when both parties contributed to the financial crisis. Watch the candidates explain why they can be trusted »

Obama said "while it is true that nobody is completely innocent here, we have had over the last eight years the biggest increases in deficit spending and national debt in our history."

Obama said the country is in the worst financial crisis since the Great Depression as he began his second presidential debate with Sen. John McCain.

He blamed President Bush and McCain for the crisis, saying they had worked to "strip away regulation."

McCain proposed having the government buy up and renegotiate bad home loans to stabilize the property market. Watch McCain talk about his plan for the economy »

He admitted the plan would be expensive but said it was necessary.

McCain also hammered away at his rival's tax policies, saying that "nailing down Sen. Obama's various tax proposals is like nailing Jello to the wall." Watch McCain slam Obama's tax plan »

"I am not in favor of tax cuts for the wealthy. I am in favor of leaving the tax rates alone," McCain said.

McCain charged that "Obama's secret that you don't know" is that he would increase taxes on small business revenue, which he said would lead to job cuts.

Obama shot back, saying "the Straight Talk Express lost a wheel on that one." Watch Obama talk about his plan for the middle class »

"Let's be clear about my tax plan and Sen. McCain's," he said. "I want to provide a tax cut for 95 percent of Americans."

In response to a question from moderator Tom Brokaw, McCain floated the names of billionaire investor Warren Buffett -- an Obama supporter -- and Meg Whitman, the former eBay executive who is one of his economic advisers.

Obama agreed that "Warren would be a pretty good choice," but declined to go into specifics about who he would nominate.

The debate was set up like a town hall, and the candidates are fielding questions from audience members, the moderator and Internet participants.

The two faced off at Belmont University in Nashville, Tennessee.

The debate follows several days of intense sparring from both nominees' camps.

Gov. Sarah Palin, McCain's running mate, accused Obama of "palling around with terrorists who would target their own country," and Obama's campaign released an ad quoting editorials that called McCain "erratic" and "out of touch."

On Monday, the Obama campaign released an online documentary criticizing McCain over his involvement in the Keating Five scandal of the 1980s. Fact check: Did McCain intervene on behalf of Charles Keating?

Obama's campaign said Tuesday's town hall setting would benefit McCain.

Going into debates, campaigns generally try to build up expectations for their opponent while lowering the bar for their candidate.

"When it comes to sheer format, we enter today's debate the decided underdog," said Obama spokesman Bill Burton in a memo sent to reporters.

"John McCain does extremely well in town hall settings. It's been his favorite format throughout his career and we think that he will of course do very well."

Palin agreed that the format should play in McCain's favor, telling reporters on her campaign plane that she thinks "he'll be feeling very much at home."

The Alaska governor was watching the debate from a restaurant in Greenville, North Carolina.

Sen. Joe Biden, Obama's running mate, was watching the debate with his family at his home in Delaware.