Romney says Obama cronyism 'stinks' as campaign gets uglier

BATON ROUGE, Louisiana (Reuters) - After days of damaging attacks about his business record, presidential candidate Mitt Romney fired back on Monday, accusing President Barack Obama of crony capitalism that “stinks.”

Romney’s allegation that Obama gave too much economic stimulus money to campaign contributors is not new but the Republican’s focus on the issue looked like an effort to move away from tough questions about his business past.

The Romney campaign released a video, titled “Political Payoffs and Middle Class Layoffs,” that accuses Obama of favoring political donors while failing to help the 23 million Americans who are out of work.

And a top Romney adviser told journalists the White House gave a loan guarantee of hundreds of millions of dollars to electric carmaker Fisker after an Obama fundraiser invested in the company.

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“It is taking your tax dollars and putting it in businesses owned by contributors to his campaign,” Romney said at an event in Baton Rouge. “And that is smelly at best. It stinks.”

His remarks were further evidence of the campaign rhetoric heating up as the two men run close in opinion polls ahead of the November 6 election.

“It’s getting kind of ugly, worse than I’ve ever seen,” said Maureen Johnson, 76, a retired schoolteacher at an Obama campaign event in Ohio. “But I don’t think it’s going to stop.”

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Romney blasted Obama for the 8.2 percent unemployment rate and said the real jobs problem could be much worse.

Romney has tried to make the weak economy the center of his campaign but has been forced in recent days to defend his time as a private equity executive at Bain Capital. He went on a blitz of TV interviews on Friday to demand an apology from Obama for attacks on his record at Bain.

‘INCOMPETENT PRESIDENT’

Obama has refused to apologize for a senior member of his campaign team who suggested last week that Romney could have broken the law by misrepresenting his position at Bain. An Obama ally, Chicago Mayor Rahm Emanuel, told Romney on Sunday to “stop whining.”

Louisiana Governor Bobby Jindal, considered to be a possible running mate on the Republican ticket, jumped to Romney’s defense.

“This president cannot run on his record so he has to lie about Governor Romney’s record,” Jindal told a small crowd at the Baton Rouge fundraiser event with Romney.

He described Obama as “most liberal, incompetent president since Jimmy Carter was in the White House.”

The Romney campaign’s pollster, Neil Newhouse, released a memo that said despite the onslaught of attacks from Obama’s team, the race remains tied.

But some polls - including a Reuters/Ipsos survey last week that had Obama 6 percentage points ahead - show the incumbent with a clear lead.

Speaking at a townhall-style meeting in Ohio on Monday, Obama poked fun at his rival, who he often accuses of outsourcing U.S. jobs to countries like China when he was in business.

“There is a new study by non-partisan economists that says Governor Romney’s economic plan would in fact create 800,000 jobs. There is only one problem. The jobs wouldn’t be in America,” Obama said.

Obama and his campaign have repeatedly questioned why Romney was listed as chief executive officer of Bain from 1999-2001 even though Romney said Friday he had “no role whatsoever” with the firm when it was cutting jobs at companies it owned in those years.

“I can assure you that the nightly conversation at the dinner table that Americans have is not consumed with the question of when was it that Mitt Romney left Bain Capital,” Romney aide Eric Fehrnstrom said. “They’re concerned about jobs and the economy.”

(Writing by Alistair Bell; additional reporting by Matt Spetalnick; Editing by Eric Beech)