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Obama: Elkhart's fate, his own linked

From NBC's Athena Jones

WAKARUSA, Ind. -- President Obama returned to Elkhart County, where he made his first outside-the-beltway trip as president, to announce a grant program to help bring jobs to this struggling community and dozens like it.

The visit was meant to show how hard hit areas would benefit from stimulus funds, even as critics argue the massive $787 billion bill is not working.

The administration is using $2.4 billion in Recovery Act money to help fund 48 projects some two dozen states. The grants will help U.S.-based companies develop and manufacture advanced batteries and electric vehicles, which officials says will result in "tens of thousands of manufacturing jobs" and help reduce America's dependence on foreign oil, an oft-stated goal of the president's.

Video: In an exclusive NBC News interview, President Barack Obama answers questions from NBC's Chuck Todd and msnbc.com readers in Indiana.

Obama told the crowd he understood their economic concerns and sought to explain what his administration was doing to help.

"I know these are tough times," he told an audience of some 250 factory workers and elected officials at the Monaco RV plant here in an area known as the RV capital of the world. Navistar International Corportation, which owns Monaco, will receive a $39 million grant to build electric trucks.

Video: Speaking in hard-hit Elkhart County, Ind., President Obama announces that the federal government will distribute $2.4 billion in taxpayer grants to create electric cars and recreational vehicles.

Although the economy contracted less than expected in the last quarter, the jobless rate nationwide reached a 26-year high of 9.5 percent in June. Matters are even worse in places like Elkhart, where unemployment has reached 16.8%. Obama noted as much in his speech, pointing out the jobless rate here went up 10 points in a year -- the second greatest increase in the unemployment rate in the country.

"This area has been hit with a perfect storm of economic troubles," he said. "Over the last few decades, you've borne the brunt of a steadily weakening of American manufacturing in the face of global competition. You've felt the impact of the struggles of American auto industry and the repercussions that have hit the Midwest especially hard."

The White House is sensitive to the complaints of everyday Americans who say the government has bailed out banks and auto companies but hasn't done enough for ordinary people. 

When asked during an interview with NBC after the event, whether it was fair to say the fortunes of this region and the president's own are "entwined" -- as an article on the front page of a local newspaper put it -- Obama said "absolutely."

The president was not the only one out hailing what he sees as economic progress today. Vice President Joe Biden, who yesterday rattled off a list of statistics to show the stimulus was doing what it set out to do, was in Detroit today to talk about the economy, highlighting grant money going to companies there. Other administration officials spread out across the country to do the same, with Energy Secretary Steven Chu traveling to Charlotte, N.C., EPA Administrator Lisa Jackson visiting St. Petersburg, Fla., and Commerce Secretary Gary Locke hitting Kansas City, Mo.

Indiana -- which went blue in November for the first time since 1964 -- and Michigan are the largest recipients on a dollar basis of the $2.4 billion, officials said. There are seven grant recipients in Indiana and eleven in Michigan.

The grants are aimed at establishing a domestic manufacturing industry able to produce the batteries and drive systems for the next generation of advanced vehicles here in the U.S.

The program provides $1.5 billion to companies to produce batteries and their components and to expand battery recycling capabilities, $500 million to manufacture electric drive components for vehicles including electric motors, power electronics and other components and $400 million grants to purchase and test thousands of plug in hybrid and all electric vehicles for test demonstrations in dozens of locations and to build electric charging infrastructure and to educate and train workers in electric transportation technology. The $2.4 billion investment will be coupled with another $2.4 billion in cost sharing from the award winners.

Under Recovery Act guidelines, 70 percent of the money must be spent by Sept. 30 of 2010 and 100 percent by Sept. 30 of 2011, though officials said some longer term research projects may not meet this standard.