Obama Hits McCain on Economy, Calls for New Taxes

RALEIGH, N.C. (Fox News) — Democrat Barack Obama on Monday seized on heightened concerns about the economy, tying John McCain to the Bush administration’s recent record of soaring gasoline prices and slumping employment. Launching a two-week economics tour in a state the GOP usually considers safe, Obama warned that McCain’s policies on taxes, spending and energy would continue the nation’s slump, which some fear is already a recession. He called for new taxes on oil companies and wealthy individuals, along with $1,000 tax cuts for most working families.

With the presidential general election now fully engaged, McCain pushed back, saying Obama’s bid to end the administration’s tax cuts for upper-income earners would only worsen the economy. He is airing TV ads in key states on the Iraq war, which he sees as a better issue this fall. But he took questions on the economy from donors in Virginia on Monday, and planned a speech Tuesday to small-business owners in Washington.

With many voters blaming Bush for the economic woes, Republican candidates for federal and state offices are scrambling to distance themselves from the bad news without abandoning core principles such as low taxes and modest government intervention in activities like banking and lending.