The 2008 race for the White House has been shaken up by angry exchanges over a joke about Senator Barack Obama, the Democratic presidential contender whose name has been confused with Osama Bin Laden.

A televised debate between Democratic candidates scheduled for Nevada in August was cancelled on Friday after local party leaders took offence at a joke told by Roger Ailes, chairman of the Fox News network.

The row over Ailes’s remarks at a broadcasting awards dinner sharpened animosity between Democratic activists and Fox News, which was sponsoring the Nevada debate despite accusations of conservative bias.

In a letter to Fox, Nevada’s two most senior Democrats complained that Ailes had gone “too far” when he joked that Obama was “on the move” and that President George W Bush might have telephoned President Pervez Musharraf of Pakistan and asked: “Why can’t we catch this guy?”

Most of those at the awards banquet on Thursday interpreted Ailes’s remarks as a dig at Fox’s rival, CNN, which was recently forced to apologise after mistakenly broadcasting the caption “Where’s Obama?” over a story about the hunt for Bin Laden.

At the same dinner Ailes also made mildly derogatory jokes about several other political figures, including Senator Hillary Clinton.

But Democrats seized on the Obama remark as evidence of a supposed conservative conspiracy to damage the party’s chances of regaining the White House in 2008.

The choice of Fox News as the broadcaster of the Nevada debate had already angered Democratic activists who gathered 265,000 signatures for an online petition calling it “a mouthpiece for the Republican party” and urging Nevada officials to cancel. Many Democrats were furious that Fox had broadcast a story claiming Obama attended a radical Muslim school in Indonesia when he was six.

Obama’s team had no comment on the fuss, but Fox executives were unrepentant.

David Rhodes, vice-presi-dent of Fox News, blamed “radical fringe out-of-state interest groups” for stirring up the row.

Rhodes said other news organisations should “think twice” before getting involved with the Nevada Democrats.

Several commentators noted that the argument had provided the Nevada party with a convenient way of extracting itself from an embarrassing political mess.

The state’s Democratic senator, Harry Reid, said Fox had been chosen because it would allow Democratic candidates to reach a broader, right-leaning audience.

But the decision was attacked by liberal bloggers and by MoveOn.org, an internet activist group. Eli Pariser, an executive director of MoveOn.org, declared the Nevada decision should “set a precedent for all Democrats” in their dealings with Fox News.

Yet other Democrats were alarmed at the prospect of friction with Rupert Murdoch, chairman and chief executive of News Corporation, which owns Fox. The company is also the ultimate owner of The Sunday Times.

Party strategists acknowledge that whoever wins the White House in 2008 will need to connect with middle-of-the-road voters, many of whom watch Fox.

The party has recently been on reasonably affable terms with Murdoch, who has described Hillary Clinton “a very impressive, able woman”.

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