With Wall Street in meltdown mode, U.S. Rep. Phil English has agreed that the $700 billion bailout package for major financial institutions buried under a mountain of bad mortgage debt is crucial.

“On the general bailout, I think it’s imperative that we pass a rescue bill now,” said English, Erie, R-3rd District.

His Democratic opponent, Kathy Dahlkemper, was singing a similar tune but also calling English and Washington Republicans responsible for the mortgage market problems at the root of the financial turmoil.

Mrs. Dahlkemper, also of Erie, accused English and Republicans of causing the crisis by deregulating the mortgage industry. English pinned its cause on poor performance by government oversight agencies and a bipartisan failure of Congress to boost the oversight of the mortgage businesss that went sour.

Mrs. Dahlkemper — a small business owner — called the bailout a necessary evil, and said she also supports a string of Democratic amendments offered so far that would bring some of the relief to Main Street.

English said he supports some of those amendments, which include a cap on payouts to the executives presiding over failing financial institutions and more government scrutiny of the bailout money to prevent abuses.

Democrats are also pushing for a change that would permit judges to adjust the mortgages of some homeowners in danger of losing their homes. Mrs. Dahlkemper also supports that measure, but English was more hesitant.

He said that Congress has passed a real estate market-related bill already. “We need to measure anything else we add . . . against the fact that we’ve already passed a (real estate) bill.”

English added that any vote he makes will depend on how the bill looks when it hits the House floor. Mrs. Dahlkemper said her opinions are only based on what’s been reported on the potential bill and amendments so far.

On preventing a future crisis, Mrs. Dahlkemper said that a tightening of the rules in some markets will be the best remedy.

“I’m not promoting more regulation in all industries,” said Mrs. Dahlkemper. “But in certain industries the regulation needs to be in there to protect the consumer. In this instance, we certainly see the downside of deregulation.”

More regulation of mortgage brokers and government oversight of the packaging of mortgages into investment secruities are both in the cards, said English. Overall, he said Congress should work to make mortgage markets more transparent rather than tighten rules.

On regulation English said he’s a “Teddy Roosevelt Republican.”

“I believe in vigorous competition in capital markets but also vigorous oversight,” English said.

In a release, Mrs. Dahlkemper accused English of staying silent on the economic decline. English shot back that it was “one of the stupidest things” he’d seen in the campaign, and pointed out a recent statement on his Web site about the economic crisis and also his prior work on a second economic stimulus package that failed to get traction in Congress.