CHARLOTTE, N.C. – Democratic presidential candidates Barack Obama and Hillary Clinton escalated their battle over a gas-tax holiday as they campaigned Friday in North Carolina.

“Yes, we do have to have a long-term energy strategy,” Clinton told more than 500 people at Greensboro’s Guilford College. “But we also need to give folks some relief right now.”

Obama, speaking later at Charlotte’s Cricket Arena, dismissed the plan.

“This is a political gimmick,” he told a boisterous rally of about 7,500. “It is not designed to lower gas prices. It’s designed to get somebody through the election.”

The proposed tax holiday has emerged as one of the sharpest differences between the candidates as they head toward Tuesday’s primaries in North Carolina and Indiana.

Both candidates appeared Friday night at the Democrats’ annual Jefferson-Jackson Day gathering in Raleigh. A thousand people paid $125 each for dinner and a seat on the floor of Dorton Arena while the stands filled with $25 ticketholders. Party officials said attendance broke all previous records for the event.

Earlier Clinton spoke in Kinston, a city she added to her schedule late Thursday after the double-digit lead that Obama had enjoyed in state polls began to ebb.

Saturday Clinton will stump in other North Carolina cities, including Gastonia and Mooresville, as both candidates push hard for the state’s 115 pledged delegates.

Clinton has been running a TV ad criticizing Obama’s opposition to a gas tax holiday also supported by presumptive Republican nominee John McCain.

“People are hurting,” a narrator says. “It’s time for a president who’s ready to take action – now.”

On Friday, Obama responded with an ad of his own.

“Here’s what she’s not saying,” his ad says. “USA Today calls her three-month gas tax holiday “political pandering.’ It’s an election-year gimmick that would save Carolinians just pennies a day.”

Speaking in Charlotte, Obama said he would tax oil companies’ windfall profits and use that money to invest in alternative energy. He would also give working families a permanent, $1,000 annual tax cut.

At issue is the 18.4-cents-per-gallon tax on gasoline and 24.4-cents tax on diesel. The money goes into a trust fund to build roads and bridges. Quoting a trade group, Obama’s campaign says suspension of the tax will cost North Carolina 7,000 jobs while saving each consumer less than $30.

Clinton also has called for a tax on oil company profits.

“It’s time to go after the oil companies,” she said in Greensboro. “They have these record profits. They need to be part of the solution, not part of the problem.”

Speaking to reporters this week, her pollster, Geoff Garin, said that while the tax savings “may not seem like a lot to some people for working families, every penny counts.”

The economy, health care and education also were on the agenda Friday.

In Greensboro, Clinton was joined by Gov. Mike Easley. He focused on the same connection between education and economic development that he had when endorsing her this week.

“We’ve got to make progress. And we’ve got to make it quick,” Easley said. “I don’t exaggerate when I say America has to move immediately. If we don’t, we could slip to a second-tier nation very easily.”

For Clinton, the college crowd represented a break in a day she otherwise spent visiting small towns. She talked about making student loans and college more affordable, expanding health care for young adults and reducing the federal deficit.

In Charlotte, Obama was interrupted by chants of “O-ba-ma.” He ticked off a list of statistics: local layoffs, the number of textile plant closings, the number of uninsured North Carolinians.

“In such circumstances, Charlotte, we cannot afford to wait,” he said.

He promised again to change the country’s politics. And he alluded to what’s become a contentious primary battle.

“It’s a healthy thing,” he said. “It’s registering voters. It’s bringing excitement to the party. But no matter what happens, when we go to the polling place in November the name “George Bush’ will not be on the ballot.”