The paycheck struggles of Americans were at the centre of the Presidential campaign, as Democratic candidate Barack Obama and Republican rival John McCain pushed their economic plans amid fresh reports of surging inflation and sagging wages.Their head-to-head battle began in earnest this week, following Hillary Rodham Clinton's departure from the race, and has focused squarely on fiscal issues - trumping the unpopular Iraq war as the pressing issue on voters' minds and putting McCain at a distinct disadvantage.The public splits between McCain and Obama as to who could handle Iraq best, but Obama is viewed as the one best to handle the economy.McCain is seeking to frame an economic policy that defends extending President George W. Bush's tax cuts but embraces quick measures that the president opposes. Obama, benefiting from public disapproval of Bush's economic policies, has continued to link McCain to Bush.The Labour Department reported Friday that consumer prices rose by 0.6 percent last month - the biggest one-month increase in inflation since last November - pushed up by surging gasoline costs. After adjusting for inflation, weekly earnings for non-supervisory workers were down 1.2 percent in May, compared to a year ago, the department said in a separate report.With the unemployment rate in May jumping to 5.5 percent, McCain said Friday he would support extending jobless assistance and said he was willing to discuss other short-term measures to boost the economy. "I think we should explore a number of options," he told reporters following a town hall meeting in Pemberton, New Jersey.McCain argued for continuing Bush's tax cuts, most of which are set to expire in 2010. Failure to extend them, he said, would result in tax increases.Obama has proposed tax cuts for low- and middle-income taxpayers, but would restore pre-Bush tax rates to the wealthiest Americans. During an appearance in Ohio, Obama called for higher payroll taxes on wage-earners making more than $250,000 annually, a step that would affect the wealthiest 3 percent of Americans.The presidential candidate told senior citizens in Columbus, Ohio, that it is unfair for middle-class earners to pay the Social Security retirement benefit tax "on every dime they make," while millionaires and billionaires pay it on only "a very small percentage of their income."An independent, liberal-leaning think tank, the Tax Policy Centre, issued an analysis of the candidates' tax plans that concluded that McCain's would primarily benefit very high income taxpayers, while Obama's would increase taxes for the wealthiest.McCain said that in extending Bush's reductions, he would spur economic activity that would actually raise government revenue.The Tax Policy Center concluded that Obama's would offer much larger tax breaks to low-and middle-income taxpayers than McCain would. Also Friday, Obama rejected McCain's proposal for 10 joint town-hall appearances, question-and-answer gatherings before small audiences that the Republican senator tends to favour.The Democrat has performed best at massive, emotional rallies drawing tens of thousands of people. Obama has offered to meet McCain in five joint appearances between now and the Nov. 4 election, but only one of those would be town hall-style and it would be on the July 4th Independence Day holiday, when few Americans would be watching.McCain called the offer "a very disappointing response." McCain had said the more intimate town-hall format would allow real interaction with voters and would be more revealing than formal televised debates. It also would give him free media attention alongside the better-funded Obama.Meanwhile, shock rippled through the American political world Friday as one of its most prominent journalists, NBC television's Tim Russert, died suddenly of a heart attack Friday at age 58.Russert had covered the election intently and was the network's Washington bureau chief. Obama said he was "grief-stricken" and McCain praised him as "a man of honesty and integrity."
