America's tragedy is that we have three neoliberals left in the presidential race at a time when, as Martin Wolf correctly pointed out in Wednesday's Financial Times, neoliberalism has collapsed. The bailout by the Fed of Bear Stearns sounded the death knell for 30 years of deregulation.

How have McCain, Clinton and Obama adjusted to the new facts of life, at a moment when the entire system is still tottering?

The Republican, John McCain, has confirmed his own low estimates of his grasp of economic policy by announcing that he is opposed to any strengthening of financial regulation to prevent the shenanigans that caused the suprime and "securitization" catastrophes which have provoked the current credit crisis. At a moment when the costs of federal bailout and decline in economic indicators are certain to require a big increase in the government deficit, he wants to cut spending.

Hillary Clinton shuttles between criticisms of McCain's stance and her formal declaration in one recent speech that she wants Clinton-era Treasury secretary Robin Rubin and former Fed chairmen Alan Greenspan and Paul Volcker to lead a "high-level emergency working group" to recommend ways to restructure at-risk mortgages to help avert more foreclosures.

Her nomination of Rubin and Greenspan scarcely encourages confidence in Clinton's oft-proclaimed capacity to hit the ground running in times of crisis. Rubin was the arch deregulator in Bill Clinton's second term. It was Rubin who successfully pushed for repeal in 1999 of the Glass-Steagall Act, which, amidst the onrush of the Great Depression and financial collapse in early 1933 (when Roosevelt closed down the banking system altogether), placed regulatory barriers between commercial and investment banking.

As Fed chairman in the Clinton and early Bush years, Greenspan deliberately encouraged the growth of speculative bubbles. He chose in 1996 not to set margin requirements on stock-market speculators and in later years fiercely advocated the deregulation of the financial system. His fingerprints are all over the subprime disaster.

This brings us to the man who, on the basis of current delegate counts, will be the Democratic nominee, Barack Obama. His track record in matters of economic policy is slight, beyond some big favors extended in his senatorial term to Wall Street, which have earned him grateful campaign funding from this quarter. It would be the matter of an hour for any capable and economically informed speech writer to draft a speech for Obama, which could politely savage Clinton's claims that she has the maturity and experience to handle the nation's economic affairs in what is sure to be a darkish time, at the start of 2009.

In recent days, partially released records of Clinton's White House log have disclosed that contrary to recent assertions she was an ardent lobbyist for the trade treaties that have shut down American factories by the thousand.

Equally, he could deride her blue-ribbon panel of Rubin, Greenspan and Volcker.

But here we come to the disturbing fact that Obama hasn't the kidney for political roughhousing and cannot bring himself, as a Democrat, to rock the boat by pointing out that the Clinton era was a feeding trough for the rich but sparse in rewards for everyone else.

Obama is careful, far more than he is courageous. Even a casual reading of the Philadelphia speech on race now touted as his finest hour confirms this. The junior senator from Illinois is a master at drowning the floundering swimmer, while earning credit for extending a hand in human solidarity. With his pastor, the Rev. Jeremiah Wright, Obama began by tossing him over the side:

"The remarks that have caused this recent firestorm weren't simply controversial. They weren't simply a religious leader's effort to speak out against perceived injustice. Instead, they expressed a profoundly distorted view of this country — a view that sees white racism as endemic, and that elevates what is wrong with America above all that we know is right with America; a view that sees the conflicts in the Middle East as rooted primarily in the actions of stalwart allies like Israel, instead of emanating from the perverse and hateful ideologies of radical Islam."

A "perceived injustice" isn't really an injustice at all. Israel is stalwart, and the perceived horror of its siege of Gaza is not even to be mentioned, as against the perversities of Islam. Then comes anathema, as pronounced by any conversationalist, divisiveness: "Reverend Wright's comments were not only wrong but divisive, divisive at a time when we need unity — racially charged at a time when we need to come together to solve a set of monumental problems."

This is courage? I don't think Obama is a real fighter. He's too pretty, and he doesn't want to get his looks messed up. Clinton probably is the tougher of the two, though there's no evidence that when the red phone rings at 2 a.m., she'll know what to say.

Alexander Cockburn is coeditor with Jeffrey St. Clair of the muckraking newsletter CounterPunch. He is also co-author of the new book "Dime's Worth of Difference: Beyond the Lesser of Two Evils," available through www.counterpunch.com. To find out more about Alexander Cockburn and read features by other columnists and cartoonists, visit the Creators Syndicate Web page at www.creators.com.

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