| HENDERSONVILLE, North Carolina
HENDERSONVILLE, North Carolina Democratic presidential candidate Hillary Clinton and Republican John McCain hammered Democrat Barack Obama on Friday for refusing to support a proposal to suspend the federal gasoline tax.
The U.S. economy and record-high gasoline prices took center stage after a Labor Department report said U.S. employers cut 20,000 jobs in April, the fourth straight month of job losses and a new sign that the economy is flirting with a recession.
Clinton, fighting to overtake Obama's lead in North Carolina, criticized Obama for not backing a summer suspension of the 18.4-cent per gallon federal tax on gasoline to give Americans some relief during vacation season.
Obama has said the proposed suspension would save each American family less than $30 and would not solve the long-term problem.
Clinton attacked McCain for how he would make up the money raised by the gasoline tax. McCain would divert funds from general government revenues to pay for transportation projects funded by the tax; Clinton would levy a windfall profits tax on oil companies.
"Senator Obama doesn't want us to take down the gas tax this summer and Senator McCain wants us to, but he doesn't want to pay for it. I believe we should impose an excess profits tax on the oil companies," she said.
McCain, at a town hall meeting in Denver, said the money would come from eliminating wasteful special interest projects that both Obama and Clinton have supported in the past.
"Let's give low-income Americans a break for the summer and realize maybe they deserve it, given the increase in food costs, given the increase in the cost of gasoline, given the increase in expenses particularly when most of them are on fixed income or even worse, having lost their jobs," he said.
In Indianapolis, Obama castigated McCain and Clinton for backing the proposal, calling it an election-year gimmick.
The idea has appeal for a U.S. public anxious about rising gas prices and the prospect of expensive road trips during the vacation season. But it has been rejected by many economists who believe the savings would end up in the pockets of oil companies already reaping record profits, instead of easing the burden on consumers.
"This isn't a real solution," Obama said. "It's a political stunt. This is what Washington does whenever there's a big problem. Politicians pretend that they're looking out for you, but they're just looking out for their poll numbers."
North Carolina and Indiana hold nominating contests on Tuesday, the next votes in the process to determine whether Illinois Sen. Obama or New York Sen. Clinton will face Arizona Sen. McCain in the November presidential election.
Clinton and Obama are locked in a close duel for the Democratic presidential nomination. He leads in nominating delegates, while she has moved into a virtual tie with him in national polls after winning in Pennsylvania last month. The Democrats' pick is nominated by delegates at the party's convention in August.
Clinton is hoping that a month of problems for Obama, in particular a controversy over racially charged rhetoric by his former pastor, will undermine his credibility as an electable Democrat.
At a news conference in Indianapolis, Obama acknowledged having "a rough couple of weeks" and predicted tight races in North Carolina and Indiana.
"This campaign has been tight throughout. But I am very confident that the American people are looking for the kind of truth-telling and serious policymaking that's going to have an impact on their lives and as long as I'm talking about the issues that matter to them, I think we've got a terrific chance," he said.
(Additional reporting by Caren Bohan and John Whitesides; writing by Steve Holland; Editing by Patricia Zengerle)
(To read more about the U.S. political campaign, visit Reuters "Tales from the Trail: 2008" online at blogs.reuters.com/trail08/ )