McCain will debate although no deal is reached

Washington -- John McCain's campaign announced Friday morning that the GOP candidate will debate tonight in Mississippi, despite his earlier pledge not to show up if a Wall Street bailout deal is not reached.

McCain's decision came at the end of a chaotic 48 hour period, in which lawmakers appeared to reach a deal on President Bush's $700 billion plan early Thursday afternoon only to find the agreement had collapsed by the end of the day.

The president spoke briefly to reporters outside the White House Friday morning and acknowledged that disagreements existed between the various parties but expressed confidence that "we are going to get a package passed." The president said it was "hard work" because there is a "big problem," but urged lawmakers to move quickly. "The legislative process is sometimes not very pretty," he said.

But on Capitol HIll, there was no immediate sign of progress.

The president's plan, which would give the Treasury Secretary authority to purchase billions of dollars worth of mortgage-related assets, was modified in negotiating sessions with House and Senate lawmakers, but House Republicans seemed to pull out of the deal Thursday afternoon and offered an alternative plan of their own.

Meanwhile, the presidential campaign collided with bailout politics as Senators John McCain and Barack Obama flew to Washington for an emergency meeting at the White House with President Bush and congressional leaders from both parties.

The meeting failed to produce a deal and both sides emerged frustrated from the process. Senate Majority Leader Harry Reid announced that Senator McCain was the last person to speak at the White House meeting and only spoke for a "couple of minutes." Other Democrats complained that McCain had pressed the issue of a White House meeting but had nothing to say at the meeting.

The Democrats were also confused about the day's events, and Rep. Barney Frank, who chairs the House financial services committee, accused House Republicans of abandoning a deal he said they had agreed to, in principle, earlier. Frank said Republicans in the meeting never mentinoed they had an alternative plan and never raised their substantive concerns at the meeting.

Other Democrats, including Reid, argued that the McCain-Obama meeting was a "photo op" tha distracted negotiators from reaching a compromise.

But in a sign of the precarious nature of the political climate, neither party wanted to be held responsible for a huge Wall Stree bailout that is seen as widely unpopular with the public. Senator Richard Shelby, a leading Republican, said that taxpayers should not be forced to pay the bill for Wall Street's mistakes.

As of 9:30 Friday morning, no deal had been reached and no final decisions had been made about Friday's presidential debate in Mississippi. Both Obama and McCain spent the night in Washington, and the Obama campaign said the candidate planned to fly to Mississippi on Friday. The McCain campaign would not commit to attending the debate.