Eighteen months ago, as the housing crisis began to gain pace in the United States, the Republican and Democratic camps wondered how much the economy would become a key election issue.

Well, now they know. Nine weeks from election day, key polls show that the economy, the housing crisis and the worsening credit conditions on Wall Street are seen as the most important issues for the American electorate.

With one in every 464 households at serious risk of losing their home, foreign policy and the war in Iraq have slipped down the priority list for the American voter. Furthermore, many areas that appear to be experiencing the worst housing foreclosure rates, such as Ohio, are political swing states.

It has become imperative for John McCain and Barack Obama to prove their economic credentials, something that neither has shown to be a strong point during the skirmishing to secure their parties’ nominations.

Mr McCain, in particular, had a good deal of ground to cover. In January, he told reporters that the issue of economics was “not something I’ve understood as well as I should”. Worse, the Republican appeared to be politically hamstrung - endorsed by President Bush, whose tax cuts and support of universal home ownership have been blamed for sowing the seeds of the sub-prime mortgage debacle and for America’s crippling deficit.

He has, however, gained valuable ground. First, Mr McCain publicly backed a Bill to allow offshore drilling for oil, a move that is hoped will increase supply, ease the surging price of gasoline (petrol) and address one of the biggest threats to the American economy - inflation.

He has also kept his message simple, concentrating on jobs. With 450,000 Americans losing their employment every week, Mr McCain’s plans to cut corporate tax from 35 per cent to 25 per cent are aimed at coaxing companies to stay in the United States rather than outsource labour abroad. He is also seeking to apply the brakes to public spending.

Mr Obama, whose message of change is played against a background of echoes from the past, with unspoken parallels to President Kennedy and Martin Luther King, is trying to create jobs by promising to splash out on infrastructure projects, as part of the Democrats’ more modest version of the 1930s’ New Deal.

Don Kettl, Professor of Public Affairs at the University of Pennsylvania, said: “The economy is going to be the most important issue in November. But, in reality, there is very little that whoever is sworn in in January will be able to do. There is a very clear risk of inflation, but it’s hard to spend your way out of it with the deficit getting bigger. Bush’s tax cuts are set to expire very soon and also there is about to be a huge rise in the number of retirees. Put all together, everyone wants something to happen but there’s not a lot the new president is going to be able to do.

“Issues such as the weakness of the dollar, the mortgage meltdown and global trade are complex and interconnected. Very few people understand them, even fewer know how to solve them.

“The candidate who wins on the economy will not be the one with the best 16-point plan but the one who is able to create confidence.”

Mr Obama’s main solution appears to centre on taxing the rich. The Democrats are proposing that families who earn more than $250,000 a year will assume more of the tax burden, with those on lower incomes paying less. Mr Obama believes that he can stimulate the jobs market - especially among the middle classes - by launching big infrastructure projects and spending on alternative energy.

Larry Sabato, Professor of Politics at the University of Virginia, said that neither candidate should worry about pandering to Wall Street: “It is probably better to run against Wall Street than with it, in terms of the voters. The corporate endorsements both candidates have secured are largely irrelevant beyond fundraising.”

John McCain, Republican

Key economic policies:

Freeze nonmilitary, discretionary federal spending for one year, then cap spending at 2.4 per cent a year

Comprehensive review of government procurement programmes

Help homeowners struggling to keep up with their mortgage payments by allowing them to take out new, federally guaranteed loans with lower rates

Reduce corporate tax rate from 35 per cent to 25 per cent

Backers:

Henry Kravis, founder of Kohlberg Kravis Roberts, the American private equity giant

Carly Fiorina, former chairman and chief executive of Hewlett Packard

John Thain, chairman and chief executive of Merrill Lynch

Meg Whitman, former president and chief executive of eBay

Fred Smith, founder and head of FedEx

John Chambers chief executive of Cisco Systems

Barack Obama, Democrat

Key economic policies

Changing personal income tax codes so families on more than $250,000 a year pay more

Windfall-profits tax on oil, crackdown on speculators, opening strategic oil reserve

Pensions - default savings account Spending on alternative energy and infrastructure in order to create more middle-class jobs

Wall Street - force banks to increase capital reserves and streamline regulation

Backers:

Warren Buffett, founder of Berkshire Hathaway, world’s richest man.

Eric Schmidt, chief executive of Google

Paul Volcker, former Federal Reserve chairman

Robert Wolf, president of UBS

William Daley, director of JPMorgan Chase

Michael Froman, head of Citi Alternative Investments

Penny Pritzker, chairman of Classic Residence by Hyatt

Laurence Fink, chief executive of BlackRock

Explore Economics

• Pre-Budget Report 2008

• Budget 2009

• World Economic Forum

• The Times MPC

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