The IMF is stepping up efforts to help emerging economies affected by the financial crisis.

The IMF is stepping up efforts to help emerging economies affected by the financial crisis.

The IMF is stepping up efforts to help emerging economies affected by the financial crisis.

A summary of what's in the major U.S. newspapers.
Oct. 24 2008 6:23 AM

Arrested Development

The New York Timesleads with word that Western officials are discussing ways in which they can help developing countries that are increasingly being affected by the financial crisis. The International Monetary Fund is the key player in all of this—it is currently working on setting up a "huge credit line" for emerging economies that are in desperate need of foreign capital and is negotiating with several countries to provide emergency loans to these troubled economies. The Washington Postleads with the lashing that Congress delivered to Alan Greenspan, the man who was once referred to as "the Oracle" of the economy. Angry lawmakers trampled over themselves to blame the former Federal Reserve chairman for the current crisis and criticize decisions Greenspan made during his 18-year tenure.

The Los Angeles Timesleads with a look at how many are praising Countrywide's mortgage-modification program that is being implemented and could eventually save borrowers as much as $8.4 billion. At a time when the government is under increased pressure to do more to help distressed homeowners, some key officials and consumer advocates are pointing to Countrywide's effort as an example that other mortgage-servicing companies should emulate. The Wall Street Journal leads its worldwide newsbox with Barack Obama's stepped-up efforts to help down-ticket Democrats with staff, funds, and appearances as his lead in the polls continues to hold. USA Todayleads with FBI statistics that show more than one-third of police officers killed last year were not wearing body armor. While most police officers have access to bullet-resistant vests, some estimate that up to 50 percent choose not to wear them, mostly because they're not exactly comfortable.

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Many developing countries that had been experiencing huge economic growth are suddenly living through a reversal of fortune as they find themselves engulfed by a crisis that started far from their borders. The WSJ says that the financial crisis has managed to undo "years of hard-won gains by emerging economies" in a matter of weeks. Banks in the developing world largely stayed away from the mortgage-backed securities that have been responsible for much of the trouble faced by their American and European counterparts. Rather, emerging economies are being hit particularly hard by the credit crunch as foreign capital has become harder to obtain, which has sent investors scrambling to reach safer waters amid growing fears that governments will have no choice but to default on their loans, which have suddenly become much more expensive.

The WSJ puts it in stark terms, noting that, over the past month, developing countries have seen borrowing costs increase "to levels that haven't been seen in six years," and there's no sign of relief in sight. The NYT points out that these troubles could represent "a volatile, dangerous new phase in the crisis." The chief economist of the Institute for International Finance does the best job of explaining why Western nations can't just sit back and watch these once-promising economies crumble: "Right now, it's a liquidity problem, but if it goes on long enough, it can become a solvency problem." The IMF currently has $250 billion at its disposal to make loans, but it's trying to shore up its piggy bank by soliciting pledges from central banks. The WP hears something different and says only the IMF would be involved because asking other countries to participate "might prove difficult." No one knows how much money would ultimately be made available, but the WP says the IMF's board will vote on the plan next week.

Meanwhile, congressional leaders continue on their determined path to look backward and assign blame. Yesterday, it was Greenspan's turn. And the man who once could do no wrong found himself on the receiving end of some scathing criticism. Greenspan expressed befuddlement, saying that he was in a state of "shocked disbelief" about the financial crisis, which "has turned out to be much broader than anything I could have imagined." The "Maestro" defended his tenure but also admitted some mistakes, particularly in his long-held belief that the free market would automatically self-correct to avoid a crisis of this magnitude. It was a dramatic scene that illustrated the view held by many economists that some of Greenspan's successes "were in fact illusory," as the WP puts it, and helped create the credit bubble that led to the current crisis.

Obama's efforts to help Democrats running for Congress marks a shift in strategy for a candidate who has been reluctant to divert attention from the presidential race  and who has worried that appearing with other candidates would hurt his image as an outsider. Some Democrats have been expressing frustration at Obama's resistance to help out other candidates. But now that he continues to lead in the polls, Obama seems more willing to lend a helping hand. But his campaign isn't rushing to highlight these efforts out of a concern that it could make Obama look overconfident.

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Still, you can't blame Obama if he's feeling a bit confident these days. The WP and NYT both front looks at how it seems increasingly unlikely that John McCain will be able to carve out a path to victory. McCain's advisers admit it won't be easy, but they insist the Republican candidate still has a chance. But while polls show Obama has many ways to reach the crucial 270 electoral votes needed to win, McCain basically has to win back all the Republican states that are now sliding toward Obama in order to remain competitive. The NYT says McCain and Obama aides agree McCain "remains very much in the game in Ohio and Florida," but he still faces an uphill battle.

In the final days of the campaign, McCain will primarily focus on taxes and spending as well as national security issues. In particular, McCain will keep highlighting Obama's comment to Joe the Plumber that he wants to "spread the wealth" as well as Joe Biden's comment that his running mate would be tested with an international crisis early in his presidency. The Republican will also emphasize the Democratic plans for the new Congress to point to "the perils of an Obama presidency with no checks and balances," as one McCain adviser tells the Post.

The WSJ points out that McCain will be releasing a new attack today that will claim Obama's tax plan will hurt families with special-needs children, particularly those that set up trusts to pay for expenses that come with a disability. It's not that families with special-needs children are such an important constituency, but McCain's campaign wants to show the "bizarre, unintended consequences" of Obama's tax plan, a McCain adviser said. Obama's campaign calls this new attack line a "blatant lie" and says that the Democratic candidate has often emphasized he would work with the Treasury Department to make sure that tax rates aren't inadvertently increased on families making less than $250,000.

The LAT fronts a look at how Sarah Palin wasn't shy about appointing donors and friends to state jobs when she became the governor of Alaska. The paper examined state records that show how, in many instances, Palin's "approach to government was business as usual" despite her claims of being an outsider keen on reform. Some of Palin's appointments created controversy because the donors and friends she plucked for the state jobs were particularly unqualified. Palin helped out donors not just with jobs but also with money as several went on to receive state-subsidized loans.

In an almost unbelievable—and certainly offensive—op-ed piece in the WP, Kathleen Parker suggests McCain picked Palin because his judgment was impaired when faced with such a hot woman. To be fair, Parker doesn't quite say it like that, and she takes pains to emphasize she's not "suggesting anything untoward between McCain and his running mate." But she cites a study that found "pretty women foil men's ability to assess the future" and wonders whether McCain will "join the pantheon of men who, intoxicated by a woman's power, made the wrong call." TP can't decide whether McCain or Palin should be more offended, though the WP should certainly feel embarrassed for publishing such sexist musings.

The NYT's editorial board endorses Obama today, saying that the senator from Illinois "has proved that he is the right choice." For those keeping track at home, that almost certainly rounds up endorsement season for the five papers that make up TP, as the NYT, WP, and LAThave all endorsed the Democratic nominee. USAT and the WSJ have a history of not endorsing candidates, though there was some talk a few months ago that the WSJ might switch tracks this year and endorse its first candidate since Herbert Hoover.

Daniel Politi has been contributing to Slate since 2004 and wrote the Today’s Papers column from 2006 to 2009. Follow him on Twitter.