Here's one vote against the town hall format from Tuesday's debate.

It's not the questions from the audience or the public at large that trouble me; I think they were good questions and reflected people's serious concerns. But there was no chance to follow up, no give-and-take as we saw in the first debate.

And there were times we needed it.

I think John McCain made big news early in the debate when he said, "As president of the United States, I would order the secretary of the treasury to immediately buy up the bad home loan mortgages in America and renegotiate at the new value of those homes, at the diminished value of those homes and let people make those, be able to make those payments and stay in their homes. Is it expensive? Yes."

That may have been the single most significant statement of the debate - and we heard no more. I suspect we will in the next few days. That's a dramatically different approach than the one taken last week to target banks and other financial institutions. There were some advocates of targeting homeowners instead. Let's see where that goes.

I also wanted to hear more about health care as right or responsibility.

An obvious follow-up for McCain would have been, "Whose responsibility?"

And for Obama, "Is this an unchecked right to all the most advanced (and expensive) treatments? Without responsibility for any of the cost?"

One point in favor of Tuesday's format: Having an audience present discouraged either candidate from sinking into a playground session of "His neighbor is a terrorist" and "His patron bankrupted a lot of old people in the savings and loan scandal."

I look forward to the last debate. I wish there were more of them. But we need a format that breaks away from sound bites from stump speeches and digs for details. That's the strength of the moderator model.

What do you think?

-- Jim Sweeney

The state Legislature adopted a budget less than a month ago, and it's already may have turned upside down. If it hasn't, there's little doubt that it will soon. The budget was intended to push the mess into next year and onto the next Legislature. In that sense, it only may succeed because the election is coming up fast.

Gov. Arnold Schwarzenegger meets Wednesday with the party leaders from the state Senate and Assembly. The Big Five didn't make much progress on the budget this summer, and there are plenty of lawmakers angry that their bills were vetoed. Schwarzenegger set a record by vetoing about 35 percent of the legislation passed this year, in many cases saying the late budget didn't give him time to review bills in detail.

The next food fight may start sooner than we think.

We will editorialize on the budget in Wednesday's paper. But the best description I've seen yet was in a column today by Dan Walters of the Sacramento Bee. He included this quote from an as-yet-unpublished commentary by Al Checchi, the mega-investor who ran for governor in 1990 and lost the Democratic primary to Gray Davis:

"The self-delusion manifested in the manner that California 'balanced' the current fiscal year budget, the myopia involved in ignoring the magnitude of future year shortfalls, and the abdication of fiscal responsibility in failing to provide a feasible basis for funding the long-term pension and health care obligations promised California's public employees, make Wall Street executives, by comparison, paragons of fiscal responsibility."

Ouch.

-- Jim Sweeney

Here's the statement from Rep. Mike Thompson explaining why he voted for the bailout package today after rejecting it on Monday. Both he and Rep. Lynn Woolsey were among those who voted for the bill today. The bill passed on a House vote of 263 to 171. President Bush quickly signed it into law about an hour ago.

Here's what Thompson had to say:

"In the last few days it's become clear that we must take action to restore a measure of confidence in our economy. You don't have to look any further than today's unemployment report, which showed our economy shedding more than 159,000 jobs in the last month. And unemployment in California is higher than at any point in the last 12 years. This just added to the growing pile of evidence that we can't afford to wait for the perfect piece of legislation. We have to do something to get our credit markets working again."

"This week I heard from people all across the district who are starting to feel the credit crunch in a real way. I heard from Dick Caletti at Standard Structures in Windsor. He was about to finalize a $10 million order from a Texas company until they got word this week that the project was stalled because of the credit crisis. There are fifty jobs tied to that one contract. Many more of our small businesses will be forced to lay off workers or wait on hiring new workers if they don't have access to credit."

"I've said from the beginning that we must pass regulatory reform to address the underlying causes of this crisis, and I've received written commitments from Speaker Pelosi and Chairman Frank that passing regulatory reform legislation will be at the top of our agenda moving forward and will stay there until we get it done."

"At the end of the day I had to set aside my outrage at all of the flawed policies, greed and incompetence that got us to this point and do what was best for our district and our country moving forward. I had to choose to either do nothing or vote for an imperfect rescue package. I voted for the bill because I believe it was the only option that we had available to begin to work our way out of this crisis. I would not have made this vote without commitments from Speaker Pelosi and Chairman Frank that Congress will address the needed regulatory adjustments to help protect the taxpayers and establish a safer financial system."

- Paul Gullixson

9: 15 a.m. The tension this morning is high. It seems like the world is waiting to see what the U.S. House of Representatives decides to do today.
Russia shut down one of its leading stock exchanges three times today to stem a free-fall in shares, a decline triggered by growing concerns about the global economy.

But the news since then has been more encouraging. The Dow was up nearly 200 points on news the House was close to reaching an agreement and possibly could have a vote this afternoon. You can bet this time a vote won't be held unless Speaker Nancy Pelosi is certain she has the votes to see it through. She won't make that mistake twice.

Meanwhile, investors also are encouraged by news that Wells Fargo will be taking over Wachovia. Why? Because this is the first rescue plan in a while that was not orchestrated by federal officials or was lubricated with federal money. The free market is showing that it's still alive.

- Paul Gullixson

Closing thoughts: This was an energetic debate - more interesting than the first Obama-McCain debate. Both Sarah Palin and Joe Biden spoke in terms that connect with everyday Americans. Both used stories to connect with viewers.

Palin did what she needed to do. She held her own and didn't embarrass herself too much, although I believe she did mess up on the name of the NATO commander in Afghanistan. She called him McClellan when I believe his name is McKiernan.

Biden did what he needed to do. He came across as well-informed as well as gracious. He didn't brow-beat or embarrass Palin.

I doubt this will change many minds. But overall, I would give this one to Biden in terms of content. In terms of being personal and personable, I call it a tie.

What did you think?

- Paul Gullixson

Opening: Both are gracious in welcoming each other. Gov. Sarah Palin starts off looking nervous. But she is doing a better job of looking into the camera and speaking directly to viewers. Ronald Reagan was a master at that. So was Bill Clinton. Neither John McCain or Barack Obama did that very much during their debate. Biden hasn't looked at the camera yet.

6:15 p.m. Did Joe Biden just try to wink at moderator Gwen Ifill, when she changed the subject to tax policy? A pretty feeble attempt at playing Palin's winking game.

Meanwhile, Palin is holding her own. But she needs to tone down the folksy talk. When asked about the bailout, she answered by talking about going to a soccer game and asking other parents how they are doing. "I betcha you're going to hear some fear in that parent's voice," she said.

Well, that's true. But what's that got to do with the bailout plan?

6:35 p.m. - I'm watching CNN. That graph showing the reactions of uncommitted Ohio voters is a little distracting, but it's interesting. Palin's numbers went up high when she talked about providing tax relief and when she said "Government is going to have to be more efficient."

The line also went up when Biden talked about how 95 percent of America's middle class will get a tax break under Obama's tax plan.

When asked how Obama and Biden would adjust their platforms based on the nation's economic crisis, Biden responded that they would need to scale back on their promise to double overseas funding. Palin said she and McCain would change nothing. Really? How about that pledge to balance the budget in four years?

Score that round for Biden.

6:45 p.m. Biden is starting to get animated when he talks about national security. Doing a much better job of looking at the camera. Ohio voters are responding favorable. I love that graph.

6:55 p.m. The topic has switched to Middle East. Biden is doing a much better job now. As chairman of the Senate Foreign Relations Committee, they are in his wheelhouse. Palin is in over her head. When asked if the Bush administration's policies concerning the Middle East, she smiled and said "no." She then goes on to say "there's just too much finger-pointing." It strikes me that she is smiling too brightly for a discussion about a five-year war that has cost 4,000 American lives.

7:05 p.m. Biden strongly denies supporting McCain's plan on the Iraq War. Going into the war, he said, "John McCain said exactly what Dick Cheney said." Ouch. Palin really stumbled over her response and avoided the question about McCain's support of the war. "John McCain knows how to win a war," she says. "He knows what evil is . . ." What does that mean?

7:10 p.m. The CNN graph shows both scored well with Ohio undecideds on the "heartbeat away" answers. Both basically said they would continue Obama's/McCain's policies should they become president. Biden used it as an opportunity to talk about restoring the middle class, creating affordable health care and assuring a college education. Palin said something about supporting McCain's policies for helping middle America and getting government "out of the way."

7:20 p.m. Biden got a little choked up right there. Ohio voters liked it. They both were asked what their real Achilles' Heel is. Palin denied it was her inexperience. She said she would put her mayoral and small business "experience to good use." She said her strength is "my connection with the heartland of America." She then went on to talk about being the mother of a special needs child, of being the mother of a soldier in Iraq, etc.

Biden was asked if his Achilles' Heel was his "lack of discipline." He laughed. He said he wasn't going to change and then started rambling about Bosnia and other policies when he suddenly switched to being personal, "I know what it's like to be a single parent," he said. He talked about losing his wife and child. "I know what it's like to have a child who might not make it . . ." That's when he got a little emotional. The Ohio undecideds liked that personal side. I want to see a replay of that segment.

7: 30 p.m. In their closing remarks, Palin did a good job of being gracious and folksy. "We are going to fight for your freedoms." She said.

Biden, believe it or not, actually came across as more middle America. He talked about how in his town of Scranton, Penn when he was growing up it was "all about integrity and respect." He shared the story of when his father told him, "Champ, when you get knocked down, you've got to get up." He then said America needed to get up. A good ending.

I'll file another blog item wrapping up some of my thoughts.

- Paul Gullixson

So what now?

Clearly Wall Street was not impressed with a 228-205 House vote today to reject the $700 billion bailout plan. The Dow plummeted 777 points, its largest single-day points decline ever.

Both of our local Congressional representatives, Mike Thompson, D-St. Helena, and Lynn Woolsey, D-Petaluma, joined an odd, bipartisan consortium of legislators in opposing the plan.

We tried to reach Woolsey and Thompson this afternoon to discuss their votes, but they were unavailable. In prepared statements, both Woolsey and Thompson said they wanted something more from this package.

Thompson said he voted against it "because it did not contain the market reforms necessary to address the underlying cause of this problem, nor did it have strong enough taxpayer protections."

Woolsey said in a statement read on the House floor that the package "fails to address the root cause of the financial crisis facing our Nation" and "does little or nothing to secure the underlying problem of mortgage foreclosures and economic suffering that hardworking are facing every single day."

Woolsey went on to state, "Where is the comprehensive economic stimulus package that will assist 95 percent of the taxpayers - a package that includes unemployment benefits, food stamps, infrastructure investment, and of course, foreclosure relief? Stability should come from the bottom up. We need an economic package that will allow those in foreclosure to pay their mortgages and stay in their homes, bringing value back to the mortgage-backed securities that are clogging the financial system."

The question is, will a better bailout plan be coming and, if so, what will happen to the financial markets in the meantime?

I spent time on the phone today trying to reassure my 83-year-old mother, a Santa Rosa resident, that her investments would be safe. But I had a hard time finding the words.

- Paul Gullixson