updated 7/10/2008 4:49:58 PM ET 2008-07-10T20:49:58

John McCain sharply broke from an economic adviser who dubbed the United States "a nation of whiners" in a "mental recession" as the Republican presidential candidate sought to counter criticism that he's weak on the economy.

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Sensing an opening, Democrat Barack Obama turned the remarks against his rival.

"I strongly disagree" with Phil Gramm's remarks, McCain told reporters in what amounted to nothing short of a smackdown against one of his top surrogates and longtime friends. "Phil Gramm does not speak for me. I speak for me."

The Republican presidential hopeful said a person who just lost a job or a mother struggling to pay for a child's education "isn't suffering from a mental recession."

"America is in great difficulty. And we are experiencing enormous economic challenges as well as others," McCain said, seeking to stem the fallout from Gramm's comments.

Gramm, a former Texas senator who is a vice chairman of the Swiss bank UBS and has a doctorate in economics, made the remarks in an interview with The Washington Times. Friends and colleagues for years, McCain served as a top surrogate when Gramm ran for president in 1996, and the Texan has returned the favor this year, campaigning frequently on McCain's behalf.

The economy is the top issue for voters and the No. 1 subject in the presidential campaign. McCain and Obama are seeking to portray the other as out of touch with the country's struggles while arguing they are the leader able to pull the nation out of tenuous times.

Gramm's comments gave McCain heartburn and Obama an opportunity.

Campaigning in Fairfax, Va., Obama seized on Gramm's comments as he tried to paint McCain as out of touch: "America already has one Dr. Phil. We don't need another one when it comes to the economy."

He drew cheers and laughter with that comment referencing television psychologist "Dr. Phil" McGraw — and boos and hisses when he read Gramm's quotes to his audience. He contrasted them with rising gas and food prices, home foreclosures and job layoffs.

"It's not just a figment of your imagination," Obama said at a town-hall event focused on helping women advance economically. "Let's be clear. This economic downturn is not in your head."

Video: McCain: 'Gramm does not speak for me' "It isn't whining to ask government to step in and give families some relief," he said, drawing a standing ovation from the nearly 3,000 people in a high school gymnasium. "And I think it's time we had a president who doesn't deny our problems or blame the American people for them but takes responsibility and provides the leadership to solve them."

McCain, a four-term Arizona senator with decades of experience on national security, has had difficulty making the case that his economic plans can get the country roaring again, especially as Democrats try to tie him to President Bush and the nation's current financial woes.

During the Republican primary, McCain acknowledged that the economy is not his strongest suit, and delivered some tough talk to economically ailing Michigan. He told voters there that lost jobs weren't coming back. He also promised to create new employment opportunities, but that was lost as then-opponent Mitt Romney used McCain's words against him.

Back in Michigan on Thursday, McCain tried to counter the criticism from Obama, arguing that the Democrat opposes offshore drilling and nuclear power to try to solve energy woes. "You talk about Dr. Phil, he is Dr. No on energy," McCain said.

Gramm attracted the attention when he told the Times: "You've heard of mental depression; this is a mental recession." He noted that growth has held up at about 1 percent despite all the publicity over losing jobs to India, China, illegal immigration, housing and credit problems and record oil prices. "We may have a recession; we haven't had one yet."

"We have sort of become a nation of whiners," Gramm said. "You just hear this constant whining, complaining about a loss of competitiveness, America in decline" despite a major export boom that is the primary reason that growth continues in the economy, he said.

Later asked if Gramm would have a role in a McCain administration, McCain raised the possibility of what could be seen as a less-than-desirable job. "I think Senator Gramm would be in serious consideration for ambassador to Belarus although I'm not sure the citizens of Minsk would welcome that."

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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