Sept. 22 (Bloomberg) -- John McCain called for limiting pay for executives of companies bailed out by the government as he and Barack Obama said an administration plan to rescue U.S. financial markets needs more oversight.

The Republican presidential candidate said taxpayers shouldn't foot the bill for ``golden parachutes'' for officers of companies that have crumbled in the upheaval on Wall Street.

``The senior executives of any firm that is bailed out by Treasury should not be making more than the highest paid government official,'' McCain said at a campaign event in Scranton, Pennsylvania. The president is the highest paid federal official, with a salary of $400,000 a year.

Obama, the Democratic candidate, said in Green Bay, Wisconsin, that any action to bail out banks and other financial institutions must give ``hardworking Americans relief instead of using taxpayer dollars to reward CEOs on Wall Street.''

Both presidential candidates made comments today aligning them with congressional Democrats who are urging modifications in a $700 billion plan put forward by President George W. Bush's administration to deal with a financial crisis that is being called the worst in the U.S. since the Great Depression.

The economy has become a flashpoint between the two candidates. Obama, an Illinois senator, is seeking to tie McCain's past support for deregulation of markets to the current turmoil.

`Common-Sense Rules'

Obama said today that the Arizona senator has ``fought time and time again against the common-sense rules of the road that could've prevented this crisis.''

McCain hit Obama for not offering a specific proposal to deal with the crisis.

``Senator Obama has declined to put forth a plan of his own,'' he said. ``At a time of crisis, when leadership is needed, Senator Obama has simply not provided it.''

Obama is leading McCain in Gallup Inc.'s daily tracking poll, 48 percent to 44 percent. The Illinois senator has held an edge in the poll since the start of last week, when the upheaval on Wall Street reached a crisis point. Most surveys show the economy is the top issue for voters.

McCain, 72, said he was concerned that the Bush rescue plan gives the Treasury secretary ``unprecedented power to spend $1 trillion -- trillion -- dollars without any meaningful accountability.''

``Never before in the history of our nation has so much power and money been concentrated in the hands of one person. This arrangement makes me deeply uncomfortable,'' McCain said. ``When we are talking about a trillion dollars of taxpayer money `trust me' just isn't good enough.''

Oversight

He wants to recruit financial experts for an independent, bipartisan board to oversee the bailout. He said those he has in mind for such a panel include billionaire investor Warren Buffett, the chairman of Berkshire Hathaway Inc. who is supporting Obama, New York Mayor Michael Bloomberg, the founder and majority owner of Bloomberg News parent Bloomberg LP and a political independent, and former Massachusetts Governor Mitt Romney, an unsuccessful Republican presidential candidate and former chief executive officer of Bain Capital LLC.

Democratic Senator Christopher Dodd, chairman of the Banking Committee, today proposed setting up a five-member oversight board to supervise the Treasury secretary's purchase and sale of distressed mortgage debt.

Compensation Limits

Dodd and House Financial Services Committee Chairman Barney Frank also want limits on compensation of corporate executives who benefit from the program.

Treasury Secretary Henry Paulson is resisting such restrictions, saying it would put the rescue plan at risk.

``If we design it so it's punitive and so institutions aren't going to participate, this won't work the way we need it to work,'' he said yesterday on the ``Fox News Sunday'' program.

McCain, who has been criticized by Obama for repeatedly saying before the market meltdown that the fundamentals of the economy are strong, predicted ``more tough economic news before the election.''

He called on Congress to ``act quickly'' to adopt the rescue plan. He did not address whether his call for an oversight board would slow the congressional debate.

``My commitment to the American people is to fix the Wall Street mess, reform Washington, and most importantly, enact a pro-growth agenda to create jobs for Americans and get this country back on track,'' he said.

`No Blank Check'

Obama yesterday called the $700 billion price tag of the Bush administration's proposed rescue plan ``staggering'' and said ``there must be no blank check when American taxpayers are on the hook for this much money.''

The Democratic nominee says any rescue measure must help homeowners stay in their homes, insist that other countries join the U.S. in securing the financial markets and put in place new rules to ensure such a crisis never happens again.

Obama, 47, today focused largely on ways to change the structure of federal operations and make them more effective and accountable to taxpayers.

He promised to make government more transparent by publicly posting corporate tax breaks, pork-barrel projects and meetings between lobbyists and government agencies. He also outlined ways to cut spending, including ending the war in Iraq and saving $40 billion a year by cutting private contracts and improving their management.

``We will fire government managers who aren't getting results, we will cut funding for programs that are wasting your money, we will use technology and lessons from the private sector to improve efficiency across every level of government,'' Obama said.

Obama and McCain are preparing for their first debate, which is scheduled for Sept. 26. The subject is foreign policy and national security.

To contact the reporters on this story: Edwin Chen in Scranton, Pennsylvania Echen32@bloomberg.net; Julianna Goldman in Green Bay, Wisconsin at Jgoldman6@bloomberg.net.

Last Updated: September 22, 2008 16:30 EDT