John McCain committed a potentially fatal public relations error yesterday in his presidential campaign. We’ll know for sure on the night of Nov. 4. However, as a public relations counselor, I would like to focus on the enormously significant PR lessons from this episode because they do cross over to the boundaries of what the financial services industry will need to do as Congress comes to terms on the unprecedented bailout package. The temptation to do a full-blown political analysis is hard to resist but instead I will zero in on some background facts, the crisis communication aspects here and the ramifications for transformative leadership at this time.

McCain’s announcement that he was suspending his campaign and calling for a delay of the first presidential debate so that he could focus on the financial crisis struck me initially as a desperate stroke to avoid a full-blown campaign meltdown. Recent polls have suggested that Obama could be breaking open this election in broad ways. However, I decided to hold judgment at bay until there was more information available and some opinions had been canvassed. Also, there was the event of President Bush’s speech last night.

So this is what we have learned in the 25 hours following McCain’s announcement. First, lawmakers appear to have struck their compromises on the omnibus bailout bill which likely could be passed before markets open next week.

Second, both presidential candidates issued a joint statement yesterday on the crisis. Interestingly enough, Obama asked McCain to add his support to a set of five principles. McCain disagreed so the principles were left out of the formal joint statement. A half hour later in his speech, Bush essentially articulated the same principles McCain had nixed. There have been some reports that McCain will vote against the bailout in an attempt to reinvigorate his maverick status among the conservative base of his party and to distance himself from the lame-duck administration.

Third, McCain admitted in a television interview he had not yet read the original plan that, incidentally, in its first form, was no more than three pages.

Fourth, campaign activities are proceeding as usual, including meetings with campaign supporters, an appearance at the Clinton Global Initiative and a television interview — all before he left for Washington, D.C. to deal urgently with this crisis. (By this time, lawmakers had moved from major sticking points to secondary issues that required reconciliation.) Also, while he asked for campaign ads to be pulled from broadcasts, the order was next to impossible to carry out because their scheduled broadcasts had already been coded and locked for airing. His wife Cindy and running mate Sarah Palin are continuing business as usual.

Fifth, his recent track record belies his immediate urgency. Of 643 votes in the current Senate session, he has missed 412, including the new GI bill and a slate of energy legislation. He also has missed 109 of 110 votes since March. While his opponent has introduced five bills dealing with the banking and housing industries, McCain has zero to his credit for the current Senate session.

Was this a good PR move for McCain? There is no poll today that suggests it was a good decision. The corresponding volume of editorials and op-ed pieces overwhelmingly challenge the rationality of this decision. David Birdsell, dean of the school of public affairs at Baruch College in New York and an expert on presidential debates, calls it a “stunt,” a “ploy,” a “very high-risk strategy.”

Adding that McCain is not yet president and that pulling out of a debate is unprecedented, Birdsell says: “That notion that we take one of the most sacred obligations and rituals of American politics and suspend it because there’s an urgent national question is highly problematic.”

Birdsell’s words emphasize the need for the response should be measured proportionally to the comprehensive situational analysis at hand. This is the first commandment of public relations in a crisis mode. To wit, the words in today’s Wall Street Journal editorial:

“Last we checked, the President of the United States was still George W. Bush, the Secretary of the Treasury was still Henry Paulson, the Chairman of the Federal Reserve was still Ben Bernanke, and Congress still had 533 members not running for President who are at least nominally competent to debate and pass legislation.

“So count us as mystified by Senator John McCain’s decision yesterday to suspend his campaign and call for a postponement in Friday’s first Presidential debate so that he and Barack Obama can work out a consensus bill to stabilize the financial system. This is supposed to be evidence of leadership?”

Good point because the bailout will require a whole new approach of messaging, positioning, and branding. The best thing that any presidential candidate can do now is to set the tone for what will be an undoubtedly painful process of reassuring a worried citizenry and restoring trust in a national financial services industry. First, no one should be hiding under a rock now — elected officials as well as corporate officers and communicators of banks and financial service companies. Where there are lots of questions about the stability of markets and one’s capacity to ensure market health means one must rise above fearful silence and communicate substantively. As one PR executive wisely suggests, “Control what you can and don’t get fixated on what you can’t. The old rules of transparency and consistency still apply.”

And, for a candidate whose actions and words haven’t matched up all that well recently, spin is never an effective strategy when one is operating in a crisis mode. Ditto for corporate communicators, according to PR expert Eric Starkman: ““A financial communicator who truly has a seat at the table, his or her role today is to serve as a reality check and to say, ‘Are we certain that the statement we’re going to issue today can definitely be true tomorrow?’”

The problem is that McCain created his own campaign crisis. Had he avoided sweeping generalizations or on-the-spot proclamations such as his recent statement that the nation’s economic fundamentals were strong, he might have been able to give credence to his decision. Instead, he may have unleashed his inevitable — and potentially humiliating defeat — at the polls.