Even as Congressional leaders and the White House were hammering out a federal rescue of the financial system over the weekend, House and Senate candidates were already using the crisis to score political points with voters.

The Democratic Senatorial Campaign Committee on Friday launched a new advertisement blaming Republican Senate nominee Bob Schaffer for the Wall Street meltdown, while the Democratic candidate in that race, Rep. Mark Udall, also used the financial crisis to bludgeon his opponent, a former GOP Congressman who left office in 2002.

In New Mexico, Rep. Steve Pearce (R) attacked his opponent in the Senate race, Rep. Tom Udall (D), and Treasury Secretary Henry Paulson, as he jockeyed for an advantage in a contest that finds him trailing significantly. Pearce on Friday went up with a television ad that argued that Udall is “too liberal” to trust in office in the midst of the financial crisis.

Neither of the campaigns on the receiving ends of these particular ads — nor their supporters in Washington, D.C. — went so far as to suggest that using the financial crisis for political gain was out of bounds. But each reacted with outrage at the charges leveled in the spots, calling them patently false.

“The DSCC seems to be confused,” National Republican Senatorial Committee spokeswoman Rebecca Fisher said, referring to the Colorado ad. “Mark Udall has been the politician in Washington doing nothing while this was happening — not Bob Schaffer.”

The DSCC was unapologetic and signaled that it intends to use the economic crisis as a political weapon in its bid to win nine Senate seats — and a filibuster-proof, 60-seat majority.

“Senate Republicans have blindly supported Bush’s economic policies, and now that those policies have led to an economic crisis, they shouldn’t be surprised that their records are making them vulnerable at home,” DSCC spokesman Matthew Miller said.

Late Thursday evening, after the conclusion of a high-level meeting at the White House that included President Bush, Congressional leaders and presidential candidates Sens. John McCain (R-Ariz.) and Barack Obama (D-Ill.), Udall attacked Schaffer for a proposal he floated as partial remedy to the the financial crisis.

In a news release and in the Colorado media, Mark Udall criticized Schaffer’s support for a temporary reduction of the repatriation tax as a way to pump money into the economy and stimulate growth. The repatriation tax is paid by U.S. companies operating overseas. Udall in a campaign statement used this suggestion by Schaffer to blame him for Wall Street’s troubles.

“For years, folks like Bob Schaffer and the Bush administration have been telling us that the key to economic success is giving the CEOs whatever they ask for,” Udall said. “Because of their policies … we now face the greatest economic crisis of our generation.”

The DSCC’s 30-second independent- expenditure ad revolves around a similar theme, tying Schaffer to Bush while specifically blaming both for a crisis that has enveloped the banking, investment and credit markets.

Schaffer chief strategist, Dick Wadhams, responded swiftly — noting in particular that Udall voted for the same temporary reduction in repatriation taxes that he criticizes his GOP opponent for supporting. Wadhams also emphasized that Schaffer has been out of Congress since 2002, adding that his candidate intends to fight back against what he called outright lies by Udall and the DSCC.

The Schaffer campaign provided a 2004 Udall quote that it obtained from the Congressional Record in which the Democrat discusses his support for a temporary reduction in the repatriation tax.

“They heap a lie upon a lie,” Wadhams said. “This absolutely underscores hypocrisy of this guy and how he tries to re-create himself.”

Campaign strategists who monitor House and Senate races are suggesting that a bipartisan rescue plan would provide cover for Democratic and Republican incumbents, effectively rendering the issue politically neutral.

But should any government-backed financial aid for Wall Street be received negatively by the voters, challenger candidates on both sides would probably use the issue for political advantage in the Nov. 4 elections. In this case, even a bipartisan deal could be a problem for incumbents running for re-election.

The National Republican Congressional Committee tends to agree with this argument. But the Democratic Congressional Campaign Committee believes the financial crisis in and of itself has created a political opening for its candidates.

In independent-expenditure ads that the DCCC is running against Republican incumbents and GOP challengers, the committee is charging that the Republican candidate supports privatizing Social Security. In light of stock market volatility and declining stock values that have accompanied the financial crisis, the DCCC sees this line of attack as especially ripe for exploitation.

Among the places where this ad is running are Pennsylvania’s 11th district, where Rep. Paul Kanjorski (D) is facing a tough challenge from Hazleton Mayor Lou Barletta (R), and Connecticut’s 4th, where Rep. Christopher Shays (R) is battling Greenwich Democratic Chairman Jim Himes.

“The economic crisis is a product of President Bush’s ‘anything goes’ policies for Wall Street that House Republicans consistently rubber-stamped,” DCCC spokesman Doug Thornell said. “They were in the passenger seat right next to the president as he drove the economy into a ditch.”

At least one Democratic House candidate has moved to capitalize on the crisis separately from the DCCC, with wealthy businessman Walt Minnick on Friday blaming Rep. Bill Sali (R) for the economic downturn as he seeks to upset the incumbent in Idaho’s 1st district.

NRCC spokeswoman Karen Hanretty, giving a window into a line of attack that could emerge from Congressional Republicans in the coming days, said Democrats are at least equally responsible for the financial crisis, if not more so.

Republicans have been arguing since early last week that Democrats blocked their attempts to strengthen the regulations governing Fannie Mae and Freddie Mac, whose willingness to back questionable home loans are credited at least partly for a collapse of the housing market, which in turn led to trouble in the banking, investment and credit sectors of the economy.

“For years, Democrats acted as enablers to Fannie and Freddie, and their reckless social agenda of putting people in homes they couldn’t afford has nearly stopped the economy dead in its tracks,” Hanretty said. “That Democrats like [House Financial Services Chairman] Barney Frank [Mass.] refuse to accept an ounce of responsibility for this fiasco … goes to the heart of how craven they are as a party.”

In New Mexico, Pearce attacked Tom Udall as “too liberal, too risky” to elect during the financial crisis, saying in a 30-second television ad that the Democrat’s record on taxes is proof he will make things worse. The spot’s voice-over calls the crisis “the greatest economic challenge of our lifetime,” charging that Udall’s policies would send the economy into a “tailspin.”

But one day before Pearce targeted Udall, he focused his ire on Paulson, noting in a campaign news release that the Treasury secretary was one of the chief reasons why he opposes a federal rescue for Wall Street.

“Paulson was chief executive officer at Goldman Sachs, one of the companies involved in creating the financial crisis,” Pearce said. “I don’t think anyone should be confident that he will hold accountable those who got us into this.”

The Udall campaign fought back against Pearce, charging that the Republican is hardly blameless in this crisis, as he has served on Financial Services Subcommittee on Financial Institutions and Consumer Credit.

The Udall campaign also criticized Pearce for trying to gain politically on the back of such a serious economic crisis.

“It says a lot that at a time when both parties are trying to come together and find a resolution to this economic crisis, Steve Pearce is focusing on political attacks,” Udall campaign spokeswoman Marissa Padilla said.