McCain, Obama question each other's judgment

Democrat Barack Obama and Republican John McCain battled over spending, taxes and the Iraq war on Friday, sharply questioning each other's judgment and ability to lead on the biggest issues facing the United States.

In a 90-minute debate that gave undecided voters their first chance to directly compare the White House candidates in the November 4 election, McCain and Obama traded heated jabs over the economy and security, highlighting broad policy differences but producing no major blunders or knockout blows.

McCain, 72, questioned the first-term senator's readiness for the White House.

"I honestly don't believe that Senator Obama has the knowledge or experience, and (he) has made the wrong judgments in a number of areas," the Arizona senator said.

Obama, 47, repeatedly tied McCain to the policies of unpopular Republican President George W. Bush and said both men had been too focused on the Iraq war while ignoring other problems. "The next president has to have a broader strategic vision about all the challenges we face," he said.

Neither candidate appeared to score a clear victory in the debate at the University of Mississippi, the first of three such encounters.

The debate between the vice presidential contenders, Republican Gov. Sarah Palin of Alaska and Democratic Sen. Joe Biden of Delaware, is next up on Thursday.

"I hope I made you proud tonight," McCain told cheering supporters at a small rally after the debate. He headed immediately back to Washington to take part in negotiations on a bailout package for the US financial industry.

Both McCain and Obama said they were optimistic Congress would come up with a $700 billion rescue plan but agreed the huge price tag would limit their agendas as the next president.

McCain said he would freeze federal spending as president on most programmes other than defense and veterans' care, and accused Obama of being a big-spending liberal who could not bring together Republicans and Democrats.

"Senator Obama has the most liberal voting record in the Senate," said McCain, who aggressively attacked Obama and at times put him on the defensive. "It's hard to reach across the aisle from that far to the left."

Obama said McCain would cut taxes for the wealthy and slash corporate tax rates, and said support of anti-regulatory approaches by Republicans like McCain had led to the collapse on Wall Street.

"This is a final verdict on eight years of failed economic policy promoted by George Bush and supported by Senator McCain," he said of the financial crisis.

McCain ended days of suspense earlier on Friday when he flew to Mississippi for the debate, backing away from his promise to skip the showdown if negotiations were not completed on the financial industry rescue.

The debate had been scheduled to focus on foreign policy and national security, but the turmoil on Wall Street has dominated the presidential campaign trail for nearly two weeks and was the first topic raised.