Obama delivers economy pep talk to hard-hit town

President Obama, returning to one of the economically hardest-hit towns in the country, announced $2.4 billion in new clean-energy grants as he encouraged the unemployed to not lose hope.

In Wakarusa, Ind., a town with nearly 17 percent unemployment, the president sought to reassure citizens by announcing the new competitive grants for the creation and development of next-generation electric vehicles.

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This is the president's second visit to the town, where unemployment has increased by 10 percent since last year, in a swing state that narrowly went for him last fall.

"This area's been hit with a perfect storm of economic troubles," the president said, calling the increase since last year "an astonishing statistic."

With polls showing increasing concern about Obama's ability to handle the struggling economy, and more troubling unemployment numbers expected on Friday, members of the Obama administration spread out around the country Wednesday to announce the awarding of the grant money.

Before leaving for Indiana on Wednesday morning, White House press secretary Robert Gibbs warned again that the administration expects to see "hundreds of thousands" of more jobs lost when the July unemployment figures are released on Friday. Currently, the national unemployment rate is 9.4 percent, but Obama and administration officials have warned they expect it to hit 10 percent soon.

Obama hailed the work of his $787 billion stimulus package, saying that "before we can rebuild our economy for tomorrow, we have to rescue it today."

But he said the focus moving forward should be on jobs created through innovation like developing new automobiles that run on sources of energy other than oil.

"For too long we failed to invest in this kind of innovative work even as countries like China and Japan were racing ahead," Obama said.

The president said he is "committed to a strategy that ensures America leads," and the $2.4 billion "is about creating the infrastructure of innovation."

Obama also received warm applause when he promised that healthcare reform will pass by the end of this year "because the American people need it."