Obama in NH: I'm tax -cutter, GOP should go along

While the White House insisted the president's stop was not about politics, the trip had a campaign feel, from the packed high school gymnasium where Obama spoke to the local restaurant where he dropped by to have lunch with a New Hampshire family.

Obama's campaign believes he can re-ignite voters' passion as they see more of him. His surrogates, including Vice President Joe Biden, will also be making frequent trips to New Hampshire.

The key for the campaign will be bringing New Hampshire independent voters back to the Democratic Party before next November's election.

Independents helped Republicans sweep the state's congressional elections and win veto-proof majorities in both chambers of the state Legislature. It was a dramatic shift for a state many believed had been shifting to the left over the past decade.

Billy Shaheen, a longtime Democratic operative in New Hampshire and the husband of Sen. Jeanne Shaheen, said Republicans' huge gains in the state in 2010 served as a wake-up call.

"After the 2010 election, New Hampshire got a taste of what the tea party can do, and it's not happy," he said. "We let our guard down in 2010."

The White House sees a year-end debate over extending payroll tax cuts, as well as renewing jobless benefits, as an opportunity to draw a distinction for voters between the president's priorities and those of Republicans. Economists have warned that letting both programs expire could be harmful to an economy still struggling to recover from recession.

Last year's cut in the 6.2 percent payroll tax, which raises money for Social Security, was accomplished with borrowed money. This time around, administration officials say the president may not insist on the cuts being paid for immediately.

The 2 percentage-point cut in the 6.2 percent payroll tax gave 121 million families a tax reduction averaging $934 last year at a total cost of about $120 billion, according to the Tax Policy Center.

Obama also wants to cut the payroll tax by another percentage point for workers and cut the employer share of the tax in half as well for most companies.

Associated Press writers Steve Peoples and Holly Ramer contributed to this report.