WRAPUP 2-Obama thanks McCain for remarks, presses attack

* Obama thanks McCain for defending him at a rally

* Newsweek poll gives Obama 11-point lead

* McCain camp: Palin acted properly in ethics matter

By Caren Bohan and Matt Spetalnick

PHILADELPHIA/DAVENPORT, Iowa, Oct 11 (Reuters) - Democrat Barack Obama praised his rival John McCain for toning down the vitriol of the U.S. presidential race on Saturday but pressed an effort to cast him as out of touch on the economy.

McCain faced fresh troubles after an ethics inquiry found that his running mate, Alaska Gov. Sarah Palin, abused her authority in a matter involving the firing of a state trooper.

At at raucous rally at a theater in Davenport, Iowa, the Republican White House nominee made no mention of the Alaska inquiry but described Palin as someone who would help him shake up government.

"I can't wait to introduce her to Washington D.C.," McCain said. "One thing I heard from Americans at every stop is they're angry -- they're angry about the mess in Washington."

"I'm angry too. When Sarah Palin and I get to the White House we'll turn Washington upside down," the Arizona senator added.

With just over three weeks left before the Nov. 4 election, polls showed a growing lead for Obama, 47, as voters anxious over the turmoil on Wall Street have given the Democratic candidate higher marks for economic leadership.

Obama sought to bolster his perceived advantage on the economy on Saturday as he toured Philadelphia, the biggest city in the battleground state of Pennsylvania.

A street-fair atmosphere prevailed at a series of neighborhood rallies, as Obama spoke on outdoor stages decorated with giant American flags.

The four rallies, aimed at boosting turnout in a strongly Democratic city, were held one after another in various parts of Philadelphia and drew a combined total of about 60,000 people.

"I know these are difficult times. I know a lot of you are worried. But I also know that now is not the time for fear or panic," Obama said, adding that McCain "doesn't really seem to get what's going on."

MILDER TONE

But before launching into his attack, Obama thanked McCain for having tried to "tone down the rhetoric" of his campaign.  Continued...