Sen. Barack Obama said Sunday that Republican rival Sen. John McCain is "out of touch, out of ideas and running out of time."

Video: '60s Figure At Center Of '08 Debate | Palin Repeats Attack | Obama Counterattacks

With less than a month to go before Election Day, Obama made a campaign swing through North Carolina on Sunday, and hit McCain on the economy and health care, trying to gain an advantage.

Obama spoke to thousands of supporters who filled a high school football stadium in Asheville. He blamed McCain and President George W. Bush for "disastrous" economic policies, and he said the Arizona senator has a health plan that will benefit insurance companies more than people.

"He wants to deregulate the insurance industry like he fought to deregulate the banking industry," Obama said. "We can all see how well that turned out." For his own plan, Obama promised to lower health care costs by $2,500 per person and spend $65 billion to buy insurance for people who can't afford it. "I'm going to cover that remaining cost with a portion of the money I'll save by ending George Bush's tax breaks for people making more than a quarter million dollars a year," Obama said. The McCain camp has responded, saying that Obama previously estimated the cost of his plan to be as high as $150 billion. But if Obama is elected, the real cost of the plan would be in the hands of Congress.

Obama also complained that McCain's recent line of aggressive television ads is simply a ploy to distract voters. McCain has raised his presence in North Carolina, a state that hasn't gone to the Democrats in 32 years.

Meanwhile, GOP veep candidate Gov. Sarah Palin was in California and on her way to Nebraska Sunday. Palin defended her attack on Obama after accusing him Saturday of "palling around with terrorists."

Palin said it's legitimate to discuss Obama's association with 1960s radical William Ayers. She said "it's important" to talk about how Obama "kicked off his political career in the guy's living room."

Obama on Sunday called the attacks a "distraction from real issues."

"You're worried about whether your job will be there a month from now," Obama said. "You can't ignore the economy."

Palin appeared recharged after last week's debate, and has been working to fire up the GOP conservative wing with attacks against Obama.

The charge was also discussed on the Sunday morning shows. Connecticut Sen. Joe Lieberman told Fox News Sunday that the McCain campaign has every right to question Obama's relationship with the former Weather Underground radical. But Missouri Sen. Claire McCaskill dismissed the effort as "ridiculous," saying the American people deserve better. She also noted that Obama was 8 when Ayers was part of the Weather Underground.

Democratic vice presidential candidate Sen. Joe Biden did not make planned campaign stops in Virginia on Sunday. The Obama-Biden campaign canceled Biden's scheduled weekend stops in Roanoke and Richmond due to the death Sunday of his wife's mother, Bonny Jean Jacobs. She had died after a long illness.

McCain is spending the weekend at his family retreat outside Sedona, Ariz. He went to a resort hotel Sunday to prepare for his second debate with Obama. They're set to meet in a town-hall format Tuesday at Belmont University in Nashville for the second of three debates.