Sept. 23 (Bloomberg) -- Presidential candidates Barack Obama and John McCain said any rescue plan for U.S. financial markets must include provisions for recouping government money and returning it to taxpayers.

In separate news conferences held as Congress debated a $700 billion measure to soak up troubled assets from the banking system, Obama and McCain clashed over how to respond to the crisis even as they agreed on the need to set limits for the government stepping in to stabilize the financial system.

Obama said the government should get a stake in any company that benefits from the rescue plan.

``If taxpayers are being asked to underwrite hundreds of billions of dollars to solve this crisis, they must be treated like investors,'' the Democratic presidential nominee said in Clearwater, Florida.

McCain, speaking in Freeland, Michigan, said the bailout involves ``an unprecedented sum and that money can't simply go into a black hole of bad debt with no means of recovering.''

The Bush administration and Congress are negotiating details of the plan to address the financial markets crisis by having the Treasury remove troubled assets from the banking system. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke warned lawmakers today that the U.S. must act quickly to return markets to normal functioning or risk a contraction of the economy.

Push for Action

The administration is pushing for action by the end of the week, though both Republicans and Democrats are raising questions about the plan. Most of the provisions cited by Obama and McCain already are part of the debate in Congress.

Obama said the plan to stabilize U.S. financial markets should include provisions for the government to purchase troubled mortgages directly, rather than just mortgage-backed securities, to provide help to taxpayers struggling to keep their homes. He also called for an independent oversight board and limits on executive compensation.

He suggested putting ``equity into those firms instead of buying their troubled assets,'' adding that ``regardless of how we structure the plan, if the government makes any kind of profit on the deal, we must give back every single penny back to the taxpayers who put up the money in the first place.''

Obama accused President George W. Bush of trying to panic lawmakers and the public into rushing forward with the rescue plan, saying American taxpayers shouldn't be expected to hand the administration a blank check.

`Stubborn Inflexibility'

``The president's stubborn inflexibility is both unacceptable and disturbingly familiar,'' Obama said, making an indirect reference to the administration's pressure on Congress in the run up to the Iraq War. ``This is not the time for my- way-or-the-highway intransigence from anyone involved.''

Obama, who said earlier today that the crisis may force him to delay some spending proposals if he's elected, took a hard line on limiting compensation for officers of companies that the government bails out. He said they are ``stewards'' responsible for their employees and communities.

``This plan cannot be a welfare program for Wall Street executives,'' the Illinois senator said.

McCain again called for limiting the amount of executive compensation paid by any firm taking part in the rescue plan to that of the highest paid government official, or $400,000 a year. Obama hasn't set a figure for the pay limit.

Oversight

The Arizona senator also wants a bipartisan board to oversee the Treasury secretary's implementation of the rescue.

``Never before in the history of our nation has so much power and money been concentrated in the hands of one person, and there must be protections and oversight in place,'' he said.

He also said the legislation and the bailout must be transparent, with details about which companies would be affected and how they were selected available ``online and elsewhere'' for the public to scrutinize.

Lawmakers also must not include any special spending projects, known as earmarks, in the legislation, he said.

Neither man would say whether they would vote against the rescue plan if their conditions aren't included.

``I will strongly recommend to Secretary Paulson that we go back to the drawing board,'' Obama said when asked if there was any single principle that, if eliminated, would cause him to drop his support.

He also said that he likely wouldn't return to Washington to cast a vote on legislation enacting the rescue plan unless ``this ends up being a close vote or a vote where the outcome is at all in question.''

Obama also reiterated his call for an additional economic stimulus package. He said it should be dealt with separately from the market rescue legislation.

``It is absolutely wrong to suggest that we cannot protect American taxpayers while still stabilizing our market and saving our financial system from collapse,'' Obama said. ``We can and must do both.''

Obama will spend the next three days in the battleground state of Florida, where he'll prepare for his first debate against McCain, scheduled for Sept. 26. McCain was in two other swing states, Ohio and Michigan, before heading to New York where he will meet up with his running mate, Alaska Governor Sarah Palin.

To contact the reporter on this story: Julianna Goldman in Clearwater, Florida at jgoldman6@bloomberg.net; Edwin Chen in Freeland, Michigan, at echen32@bloomberg.net

Last Updated: September 23, 2008 17:52 EDT