John McCain yesterday declared himself the underdog who “never gives up” even after falling far behind in the polls against an opponent already "measuring the drapes" for the White House.

At a rumbustious rally with 18,000 supporters at Virginia Beach he claimed that even now Barack Obama, together with the Congressional Democratic leadership of Nancy Pelosi and Harry Reid, were plotting on how to concede defeat in Iraq or raise spending.

Mr McCain then added, with a broad grin: “We’ve got them just where we want them.”

The reference to Mr Reid and Ms Pelosi is a tacit recognition not only that his campaign is making little headway against Mr Obama but also that a November landslide in both presidential and Congressional elections would leave Democrats dominant across Washington.

Mr McCain's speech, though widely billed as the relaunch for a floundering campaign, did not mention any of up to 30 new proposals for the economy that he had spent much of the weekend discussing with advisers.

Instead, mentioning "fight" and "fighting" 19 times but the word "economy" only six, Mr McCain emphasised his experience, and sympathised with the financial worries of ordinary Americans.

Mr McCain chose only to give a more coherent account than he has offered in recent weeks of existing policies for cutting taxes, capping spending, refinancing mortgages and rebuilding savings.

He sought to distance himself from President Bush's deeply unpopular Republican administration while also implying that his rival is too callow to lead.

"We cannot spend the next four years as we have spent much of the last eight: waiting for our luck to change. The hour is late, our troubles are getting worse, our enemies watch. We have to act immediately," he said.

"The next President won't have time to get used to the office. He won't have the luxury of studying up on the issues before he acts. He will have to act immediately. And to do that, he will need experience, courage, judgment and a bold plan of action to take this country in a new direction."

Senior Republicans have increasingly voiced dismay over the apparent disarray in his campaign, but Mr McCain has made a habit of improbable comebacks and he ended his speech with a trademark rallying call. "Stand up, stand up, stand up and fight," he said. "America is worth fighting for. Nothing is inevitable here. We never give up. We never quit. We never hide from history. We make history."

By contrast, Mr Obama used his own speech in Toledo, Ohio, to lay out a four-point "Economic Rescue Plan for the Middle Class" and deliver a sober warning that straitened circumstances will require all American to adopt a "new ethic of responsibility" if they are to break the cycle of debt.

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