European governments are trying to deal with a growing credit crunch.

European governments are trying to deal with a growing credit crunch.

European governments are trying to deal with a growing credit crunch.

A summary of what's in the major U.S. newspapers.
Oct. 6 2008 6:33 AM

Europe's Turn

The New York Timesleads with, and the Wall Street Journal fronts, a look at how European governments are taking steps to prevent major banks from going under while trying to prevent panic from spreading by boosting insurance levels on private accounts. What at first looked like a problem that was limited to American mortgage-backed securities has now expanded (this may sound familiar) as European banks are growing more reluctant to lend to one another. And while there's little question that they take the problem seriously, the WSJ points out that yesterday's "frantic and disparate moves raise questions about whether European governments, regulators and bankers have a comprehensive approach to addressing the deepening financial crisis." The crisis is making it clear that while their economies may be integrated, there are still deep divisions among European governments.

Today marks the deadline for voter registration in many states and the Washington Postand USA Todayuse that timely hook to take a fresh look at how Democrats have been far more successful at registering new voters, which could be critical to Barack Obama's success in November. The Los Angeles Timesleads with a local focus on the news that Countrywide Financial has agreed to what is almost certainly the "largest predatory-lending settlement in history." The deal could provide as much as $8.7 billion in relief to 400,000 borrowers, most of whom might see reductions in their interest rates and principal. The Wall Street Journal leads its world-wide newsbox with a look at the small but crucial minority of voters who say they are still undecided or who may only be leaning toward one candidate. Some of them are voters who chose President Bush in the last two elections but are unhappy with his presidency. As hard as it may be for news junkies to believe, many of these voters say they don't feel as if they have enough information about the candidates, especially Obama, to make a decision.

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In a surprise move, the German government said that all private bank deposits would be guaranteed and also announced details of a new bailout package for Hypo Real Estate, a large property lender. Meanwhile, the governments of Belgium and Luxembourg announced that a French bank will take over most of what is left of Fortis, a banking and insurance giant, after last week's bailout package failed to shore up the company. And these are just the two biggest examples of how European governments are trying to deal with the crisis after the leaders of Europe's largest countries vowed to protect the financial system from collapse.

The NYT says this financial crisis "appears to be the most serious one to face the Continent since a common currency, the euro, was created in 1999." Officials had hoped the $700 billion bailout package approved by Congress last week would calm markets around the world, but that is increasingly starting to look like a pipe dream. Early-morning wire stories report that Asian stock markets plunged today out of increasing fears that the crisis is spreading.

USAT takes a look at eight key states that register voters by party and notes that while Democrats have increased their rolls by about 800,000 voters, Republicans have lost 300,000. These numbers are likely to change as officials deal with a wave of late-filing registrants. So far, according to the WP, about 4 million voters have been registered in a dozen battleground states over the past year. In some cases the difference between Democratic and Republican registrations is staggering, as in North Carolina, where the ratio is 6 to 1.

The WP says the "trend is clear" even in states that don't register voters by party, as a disproportionate number of new voters live in Democratic areas. While Republicans recognize they're at a disadvantage in terms of voter registration, which saw a big boost during the heated primary fight, they also insist there's a big difference between registering voters and actually getting them to the polls.

The WP and WSJ front a look at the intensifying fight between Citigroup and Wells Fargo over Wachovia that now has Federal Reserve officials acting as middlemen to speed up a compromise. In the end, Wachovia might be split up between the two buyers, but nothing is quite clear yet, and it could all very well result in a protracted legal battle. One could find it encouraging that an institution seen as close to collapse last week now has two potential buyers. But Fed officials' worries that uncertainty about Wachovia's future could create bigger problems illustrates the vulnerability of the industry and the increasing involvement of the government in deciding the future of big financial institutions.

The LAT fronts a look at three crashes in the early days of John McCain's aviation career that reveal a pilot who "was cocky, occasionally cavalier and prone to testing limits." Although crashes were more frequent when McCain started flying than they are now, the LAT talks to some experienced pilots who say that three is an unusually high number. It's likely the Navy would have launched a review of the accidents before McCain was deployed to Vietnam to determine whether he should have been permitted to continue flying. But the results of any review would have been confidential and the McCain campaign isn't talking. It's hardly a secret that many considered McCain undisciplined when he was younger, but it's interesting to read about other parts of the nominee's military career that are often ignored.

The WSJ takes a detailed look at the days leading up to Lehman Bros. filing for bankruptcy protection, days that raise questions about whether executives went too far in expressing confidence in the company's future. All financial firms that are in trouble have to play a complicated balancing act, since so much of their business is based on trust, but Lehman executives might have taken this to an extreme. The FBI is investigating whether the firm deliberately misled investors. Some think that the misrepresentation went beyond the public statements and say that Lehman kept the value of its real-estate holdings artificially high even after it was clear that the financial crisis was decimating the value of these types of securities.

All politicians are evasive, so why were Gov. Sarah Palin's efforts to ignore moderator Gwen Ifill's questions at the debate last week so jarring? The WP suggests Palin may have just been too honest about what she was doing. While other candidates might try to make a transition between the question's subject and what he or she actually wants to discuss, Palin was more explicit and even declared, at one point, that she was switching topics. Psychologists say politicians are unlikely to pay a price for skillfully dodging questions, because most people aren't good at remembering what was asked in the first place. "Voters say they prefer candid politicians," writes the Post's Shankar Vedantam, "but the experiments suggest politicians may pay a higher price for intellectual honesty than dishonesty."

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