WASHINGTON -- Barack Obama and John McCain sparred over the economy Monday, with domestic issues returning to the limelight in the 2008 presidential race as the Democrat discussed tax increases and the Republican called for more offshore oil drilling.

Both candidates gathered economic experts around them to argue their cases. Obama met in Washington, D.C., with a star-studded panel of economic advisers that included investor Warren Buffett; Eric Schmidt, chairman and CEO of Google; former Bush administration Treasury Secretary Paul O'Neill; Clinton administration treasury secretaries Robert Rubin and Larry Summers as well as Robert Reich, who served Bill Clinton as secretary of labor.

Obama told the group he wanted a second stimulus package on top of the $168 billion package that passed earlier this year. He also lambasted President Bush for presiding over a budget that is projected to be in deficit next fiscal year to the tune of $490 billion.

"I believe that more action is necessary. I believe we need a second round of economic stimulus," he said, adding that he would move "rapidly and vigorously" to put in place new incentives to revive the ailing economy.

Obama was quick to blame corporate America and Washington for the downturn, and listed key battleground states as targets for his economic focus in the next three months.

"It was not an accident or a normal part of the business cycle that led us to this situation," Obama said. "There were some irresponsible decisions that were made on Wall Street and in Washington.

"This is an emergency we feel not only when reading the Wall Street Journal, but when we travel across Ohio and Michigan, New Mexico, no matter where you meet people day after day who are one foreclosure, one illness, one pink slip away from economic disaster," he said.

Obama is planning to travel to other battlegrounds of Missouri and Iowa later in the week. He will also raise money in Texas before heading to Florida. He warned his economic advisers that the current crunch was "a direct result of putting off tough decisions for too many years. ... The economic emergency is more and more severe."

Meanwhile, McCain's camp held a conference call with its own finance superstars, including Meg Whitman, former president and CEO of eBay; Carly Fiorina, former CEO of Hewlett Packard; Harvard University professor and president of the National Bureau of Economic Research Martin Feldstein; and Stanford University professor John Taylor.

Fiorina called the Obama get-together "yet another photo op" and noted that while Obama posed with the likes of former Federal Reserve chairman Paul Volcker, "John McCain has been talking with (current Federal Reserve chairman) Ben Bernanke and (current Treasury Secretary) Hank Paulson and a whole set of folks over the last year-plus to make sure that he continues to keep his pulse on the American economy."

On Monday, McCain, an earmark hawk, called wasteful spending the culprit for the economic downturn.

"There is no more striking reminder of the need to reverse the profligate spending that has characterized this administration's fiscal policy," McCain said in a statement.

"As president, I have committed to balancing the budget by the end of my first term," McCain said. "Today's news makes that job harder but should not change our resolve to make the tough decisions and the genuine effort to reach across the aisle that are needed to ensure a lasting solution to the spending problem that threatens the very stability of our economy."

McCain repeated Sunday that reducing dependence on foreign oil would be a primary goal of his administration. To that end he has called for increased offshore oil drilling, a position that has been criticized for overlooking the needs of Americans now, who are now paying roughly $4 a gallon for gas.

Feldstein and Taylor made the point that McCain's energy plan will reduce gas prices in the short term. Since oil companies will realize that with more drilling, prices will eventually go down, oil providers will have the incentive to boost the amount of supply entering the market in the short-term.

"Something's that going to change the supply and demand five years, 10 years, 20 years from now will have an impact on today's prices. ... If the price is going to be lower in the future because of more supply and less demand that price is going to come down in the future, that gives producers and others an incentive to sell more today rather than hoarding it, inventorying it, or failing to bring it out of the ground. An that's an incentive that affects not just American firms but also the Middle East oil providers who look ahead and see policies coming into place which are going to affect the demand and supply over the long term,” Feldstein said.

McCain Communications Director Jill Hazelbaker earlier criticized Obama for not supporting offshore drilling.

"There is a short term component and a long-term component ... and that's the issue of drilling," Hazelbaker told FOX News. "John McCain has said that states need to have the ability to open up their own coast to offshore drilling, decided, of course, by the states themself. Barack Obama has been opposed to that. He's also opposed to short term relief at the pumps for a gas tax holiday. He's been Dr. No on this issue."

At a time when all the major polls show U.S. voters consumed primarily with economic issues -- growing joblessness, high fuel costs, rising food prices and a crisis in home financing -- Obama has offered his own prescription for an economic course correction. He has called for tax hikes on people making more than $250,000 a year to pay for a massive budget deficit and investment in infrastructure he wants to make.

"We've got to deal with the fact that a lot more people are unemployed and are going to need unemployment benefits. We've got to shore up the housing market because people are experiencing foreclosures," he said in an interview taped in London on Friday and aired on FOX News on Monday.

Obama said he will raise taxes on families making $250,000 or more but pledges that anyone earning $150,000 or less will get a tax cut under his proposed budget plan.

The presumptive Democratic presidential candidate told FOX News that he defines the middle class as anyone making under $250,000.

"What I would say is, if you are making more than $250,000, than you're more than middle class. You're doing better. If you are making less than $250,000, then you are definitely somewhere in the middle class. And if you're making $150,000 or less, than I think most Americans would agree that you're middle class. So that's why the fact that if you are making less than $250,000, you will not see your taxes go up under an Obama administration," Obama said.

"I think that's the right way to promote the kind of bottom-up economic growth that's going to make a difference in people's lives," he added.

Over the weekend, Obama repeated his call for increasing the income on which Social Security payroll taxes are levied. He told voters in Ohio it's unfair for middle-class earners to pay the Social Security tax "on every dime they make," while millionaires and billionaires pay it on "only a very small percentage of their income."

Right now the first $102,000 of each worker's income is taxed at a 6.2 percent rate, which employers then match. Obama's aides have quietly suggested a proposed tax rate on incomes above $250,000 at a rate of about 2 percent to 4 percent.

It's also possible that it would apply to more types of income, including dividends and investments.

The Associated Press contributed to this report.