"Let them fail," says Libertarian Party spokesperson Andrew Davis, referring to the mortgage institutions Freddie Mac and Fannie Mae, who the Bush administration has said it plans to rescue from financial collapse.

"Let them fail, and let them learn from their mistakes on their own dime," says Davis. "Bailing out these two institutions will only delay the inevitable outcome of any financial firm insulated from the market by government backing. The long run damage of continuing a policy of bailouts far exceeds any short term woes in letting the market consume failing institutions."

The Libertarian Party is calling for an end to government bailouts, which it equates to nothing more than welfare for businessmen. The Party believes that government support of these institutions decreases the incentive to make responsible decisions, and unfairly socializes the risk--putting taxpayers on the line for costly mistakes.

"It's like giving more candy to problem children," says Davis. "Lenders should recognize that there are repercussions for risky loans, and borrowers should realize that there are consequences for taking loans they can't repay. If it's financial collapse, or having your house foreclosed--so be it. It's bad economics to remove the incentives, even if they are negative, which encourage sensible and responsible decisions."

The Party says Freddie and Fannie should be fully independent of government support, and subject to the same levels of market competition other firms face.

"I could not agree more with the editorial page of yesterday's Financial Times when it said that the current structure of these institutions cannot be maintained, and that government should prepare a 'decent burial' for them," says Libertarian Party National Chairman William Redpath. "Freddie and Fannie are not needed for mortgage finance in the United States. No credible commentator thinks that the failure of these two institutions would add even as much as one percentage point over the long-term to mortgage rates. Congress and the President need to quickly move Fannie and Freddie to privatization with no strings attached to the federal government and taxpayer."

The Democratic Party's presidential nominee, writing in The New York Times yesterday, said that while US troops had performed "heroically" in Iraq, Afghanistan was the real frontline in the battle against al-Qa'eda.

The comments came a day after nine US soldiers were killed in a gun battle when al-Qa'eda-Taliban forces attacked a base in eastern Afghanistan, the deadliest attack they have suffered in three years.

Mr Obama added that the conditions that led him to oppose the war in Iraq and last year's "surge" of US forces had not altered.

"The strain on our military has grown, the situation in Afghanistan has deteriorated and we've spent nearly $200 billion more in Iraq than we had budgeted," he wrote.

The article will be followed by a major foreign policy speech today in which the candidate will lay out his vision for his presidency.