The Democratic presidential candidate launched a two-week economic tour on Monday that will take him to key battleground states in the November election. Obama was trying to make the economy the central theme of the general election campaign rather than national security issues where McCain has an advantage.
Polls show that the weak US economy has surpassed the Iraq war as the key concern for voters.
In his first speech since Democratic rival Hillary Rodham Clinton suspended her bid for the White House, Obama tried to win over her working class constituency, focusing on home mortgage foreclosures, staggering energy costs and growing unemployment.
Obama spoke in North Carolina, where the working class has been hard hit, but it is an issue that could reverberate across the electorate nationally.
North Carolina is not a state ordinarily pursued by Democratic presidential nominees. But it gave Obama a crucial victory in his primary battle against Clinton, and he hopes to put it in play this fall - or at least force McCain to spend time and money here.
The centerpiece of McCain's economic plan "amounts to a full-throated endorsement of George Bush's policies," Obama told about 900 people in Raleigh.
He took part of his speech from headlines across the United States, noting that the average price of gas had just hit US$4 ($NZ5.3)a gallon for the first time, far below prices in Europe and elsewhere, but a shock to Americans used to cheap gas.
Repeatedly linking McCain to Bush, Obama said, "our president sacrificed investments in health care, and education, and energy, and infrastructure on the altar of tax breaks for big corporations and wealthy CEOs."
Obama criticized McCain for originally opposing Bush's first-term tax cuts but now supporting their continuation. He said he would place a windfall profits tax on oil companies while McCain would reduce their taxes.
Obama offered no new policies in his speech. He used the occasion to summarize earlier proposals, including raising income taxes on wealthy Americans, granting a US$1000 tax cut to most others, winding down the Iraq war, tightening credit card regulations and pumping more money into education, alternative fuels and infrastructure such as roads and bridges.
Even before Obama spoke, McCain issued a statement through his spokesman that said Obama "has promised higher income taxes. Social Security taxes, capital gains taxes, dividend taxes and tax hikes on job-creating businesses."
"Barack Obama doesn't understand the American economy, and that's change we just can't afford," a McCain spokesman, Tucker Bounds, said.
McCain is airing TV ads in key states on the Iraq war, which he sees as a better issue for him in the November election. But he took questions on the economy from donors in Richmond, Virginia on Monday, and planned a speech on Tuesday to small business owners in Washington.
McCain noted that he supports a temporary summer suspension of the federal tax on gasoline, which Obama dismisses as a gimmick that will not bring down prices and enjoys little support among economists.
"Talk to somebody who owns a couple of trucks and makes a living with those trucks," McCain said. "Ask them whether they'd like to have some relief - 18 1/2 cents per gallon for gasoline and 24 1/2 cents for diesel. They say it matters."
In a potential boost to Obama, the AFL-CIO, the largest US labour organization, plans to have its members protest Bush and McCain at gas stations around the country. Union members will hold signs saying "Bush & McCain Love Big Oil" and complain about a McCain tax proposal they say would give the five largest oil companies US$3.8 billion in tax breaks.
Separately, Obama ramped up his search for a running mate on Monday, consulting with fellow Illinois Sen. Dick Durbin by phone and dispatching members of his vice presidential vetting team to the Capitol for meetings with top Democrats in the Senate and House of Representatives..
McCain, meanwhile, reversed course on Monday and allowed the media into three private fundraisers in Washington and Virginia that his campaign said had raised more than US$2 million. The four-term Arizona senator had kept such events off limits to the media for months with little or no explanation.
At one fundraiser, McCain chided Obama for his reluctance to agree to a series of town-hall meetings where both candidates would field questions from voters.
McCain said he would meet Obama wherever and whenever, then suggested this week in New York.
"He's not going to be there, but we'll keep asking," McCain said to a few chuckles. "Over time, maybe he'll agree. At least I hope so."
McCain has proposed 10 such meetings in the coming months and campaign managers for both sides said they had agreed in spirit to schedule some type of joint appearances.
McCain will need all the financial help he can muster as he moves toward the November vote against Obama's well-oiled fundraising machinery that has rolled up an astounding bankroll, much of it from small donors on the Internet.
Obama has raked in US$264 million in 16 months. McCain has raised less than half that much, $115 million, in 17 months. However, at the national party level, the Republican National Committee was ahead, raising $166 million to the Democratic National Committee's $82.3 million over the past 17 months.
