John McCain on Saturday kept up his attacks on Barack Obama's tax policies, saying that he would turn the IRS into a giant welfare agency and likened his economic plan to socialism.

"At least in Europe, the Socialist leaders who so admire my opponent are upfront about their objectives," McCain said in a radio address. "They use real numbers and honest language. And we should demand equal candor from Sen. Obama. Raising taxes on some in order to give checks to others is not a tax cut; it's just another government giveaway."

McCain leveled the charge before a pair of appearances aimed at restoring his lead in critical battleground states. In both North Carolina and Virginia, where McCain was to speak later in the day, his campaign has surrendered its lead to Obama in various polls. President Bush, a Republican, won both states in 2004.

The state dips mimic larger national trends that have given Obama a lead over McCain following Wall Street chaos that focused the race on who is best equipped to restore the economy.

Obama reacted incredulously to McCain's charge that his tax cut is welfare.

 "...John McCain is so out of touch with the struggles you are facing that he must be the first politician in history to call a tax cut for working people 'welfare,'" Obama said at a rally in St. Louis Saturday.

"The only 'welfare' in this campaign is John McCain's plan to give another $200 billion in tax cuts to the wealthiest corporations in America -- including $4 billion in tax breaks to big oil companies that ran up record profits under George Bush," Obama added.

On Sunday, McCain was to travel to Ohio, where he might appear with "Joe the Plumber," the Holland, Ohio, plumber Joe Wurzelbacher whom the senator has been portraying as emblematic of people with concerns about Obama's tax plans.

Wurzelbacher became the focal point of the final presidential debate after he met Obama earlier in the week and said the Democrat's tax proposal could keep him from buying the two-man plumbing company where he works. However, reports of Wurzelbacher's annual earnings suggest he would receive a tax cut rather than an increase under Obama's plan.

Obama has said his tax policies would cut payments for 95 percent of working Americans, while increasing them only for families making more than $250,000 a year. McCain has argued that 40 percent of Americans don't pay income taxes, either because they are seniors or don't meet minimum earnings thresholds, so the only way to cut their taxes is to give them various credits.

"In other words, Barack Obama's tax plan would convert the IRS into a giant welfare agency, redistributing massive amounts of wealth at the direction of politicians in Washington," McCain said in the radio address.

The Associated Press contributed to this report.