DAYTON, OHIO — The campaign for president pivoted sharply to character and temperament Thursday as Democrat Barack Obama accused his Republican counterpart of "erratic behavior" and John McCain offered his most public -- if still elliptical -- criticism of Obama's acquaintance with a onetime domestic bomber.
With the free-falling stock market as a fearful backdrop, Obama sought to use McCain's newest economic proposal -- a mortgage bailout plan he announced in Tuesday's debate -- to suggest in his sharpest language yet that McCain is unfit to be president.
He criticized a change the Arizona senator made to the mortgage plan that would give a break to lenders that had made bad loans.
"So banks wouldn't take a loss, but taxpayers would take a loss," said Obama, characterizing the switch as "just the latest in a series of shifting positions. . . . This is the kind of erratic behavior we've been seeing out of Sen. McCain."
Each candidate has tried to characterize the other as the riskier choice for voters, and on Thursday McCain's effort to portray Obama as iffy presidential timber took a page from the 1960s. Campaigning with running mate Sarah Palin at a town hall-style event in Waukesha, Wis., McCain was asked by a participant about Obama and "the people that he has hung with."
Without mentioning the name of Weather Underground co-founder William Ayers, McCain alluded to him as "an old, washed-up terrorist" and said that "we need to know the full extent of the relationship because of whether Sen. Obama is telling the truth to the American people or not."
McCain also launched an Internet ad about Obama and Ayers. The two live near each other in Chicago, and in the mid-1990s Ayers, now an education professor, introduced Obama at a political event at his home. The Illinois senator was 8 when Ayers and his colleagues planted bombs to protest the Vietnam War, and it was not clear when he learned of Ayers' past behavior. The two are not close, and Obama has criticized the bombings as "detestable."
The moves by Obama and McCain in middle America suggested the outlines of the campaign 26 days before election day: Obama, riding a surge in national and bellwether-state polls, was campaigning in southwestern Ohio, where Republicans have often built up strong margins to win the crucial state. Obama is trying to offset Republican efforts by marshaling his legions of newly registered Democrats. And he was using the economy, by far the most important issue to voters, as a cudgel.
McCain was campaigning as the underdog in Wisconsin, where he was trying to stoke concerns about Obama's background and relative lack of national experience to peel away voters who might otherwise be pulled into the Democratic camp by Obama's momentum. It remained unclear, however, whether voters would see McCain's argument as germane or irrelevant in an electoral environment that for weeks has been rocked by dire economic news.
More bluntly than he has in the past, McCain conceded Thursday what political analysts have suggested for weeks -- that his campaign was in trouble, and time for a shift in fortunes was diminishing.
"In case you missed it, this is about the seventh or eighth time that pundits have said, 'McCain's campaign is in trouble,' " the senator said at a second event in Mosinee, in a reference to his Lazarus-like resurgence before winning the nomination. "We fooled them then, and we'll fool them again."
Policy matters took a back seat to character issues Thursday, but the campaigns did bicker over McCain's mortgage plan. The plan would spend as much as $300 billion to buy up mortgages to stabilize the housing market. As initially announced Tuesday, it would have made lenders responsible for "the loss that they've already suffered." By the next morning, the campaign said that line was a mistake.
Obama pounced on the change Thursday as evidence that McCain favored banks over homeowners. "We have to act to fix our broken economy and restore the credit markets, but taxpayers shouldn't be asked to pick up the tab for the very folks who helped create this crisis," Obama said in Dayton.
For Obama, the back-and-forth over policy was less important than pressing the notion that McCain had moved unpredictably on an economic issue. He has been drumming the same theme for weeks, ever since McCain's scattered early response to the credit market's collapse.
"We need a steady hand in the White House. We need a president you can trust in times of crisis," Obama told the crowd at a later rally in Cincinnati, where he said McCain was "lurching all over the place" on the economy.
McCain, for his part, has used the Ayers issue sporadically in recent days, raising it in interviews but declining to do so in rallies or when he was onstage with Obama in Tuesday's debate. But in making the connection more directly on Thursday, McCain misstated the facts.
He described Ayers as someone "who still, at least on Sept. 11, 2001, said he still wanted to bomb more" -- implying that's how Ayers responded to the terrorist attacks. McCain's reference was to a New York Times interview published Sept. 11 -- based on an interview given before that day's terrorist attacks -- which quoted Ayers as saying he did not regret setting bombs and that "we didn't do enough."
Ayers complained at the time that his quotes were juxtaposed, and said he meant only that he felt he didn't do enough to stop the Vietnam War.
Finnegan reported from Ohio, Nicholas from Wisconsin. Times staff writer Cathleen Decker contributed to this report.