Obama Clarifies Sin City Comment in Letter to Sen. Reid — UPDATED

Feb 2, 2010 6:03pm

ABC News' Karen Travers and Rachel Martin report: 

What happens in Nashua NH doesn't stay in Nashua NH.

At a town hall meeting there today President Obama tried to hammer home his message that the federal government needs to rein in its spending in tough economic times, just as Americans shouldn't gamble their money away in Las Vegas.

"Responsible families don't do their budgets the way the federal government does," he said. "When times are tough, you — you tighten your belts."

"You don't go buying a boat when you can barely pay your mortgage. You don't blow a bunch of cash on Vegas when you're trying to save for college. You prioritize. You make tough choices. It's time your government did the same."

That "blow a bunch of cash" comment in Vegas did not sit well with Senate Majority Leader Harry Reid, who represents Nevada, has a vested interest in tourists continuing to come to Las Vegas and spending money-and if facing an uphill battle in his re-election effort.

Jon Ralston, political columnist for the Las Vegas Sun, reports that Reid spoke to the White House and said Obama "needs to lay off Las Vegas and stop making it the poster child for where people shouldn't be spending their money."

"To truly reenergize our economy, we need people to travel to Las Vegas," Reid said.  "I would much rather tourists and business travelers spend their money in Las Vegas than spend it overseas."

This isn't the first time Obama went after Las Vegas for excess and irresponsibility.

Last February, Obama singled out Las Vegas when scolding Wall Street executives for not being more responsible with taxpayers money.

"We're going to do something to strengthen the banking system," Obama said. "Your are not going to be able to give out these big bonuses until you pay taxpayers back. You can't get corporate jets. You can't go take a trip to Las Vegas or go down to the Super Bowl on the taxpayers' dime. There's got to be some accountability and some responsibility." 

Las Vegas Mayor Oscar Goodman doubled down and demanded an apology and a retraction from the president. 

Danny Tarkanian, the son of the legendary UNLV basketball coach, is a Republican candidate for US Senate in Nevada. He issued the following statement today:

"The President owes the always hospitable people of Las Vegas an immediate apology for once again treating them as a cheap applause line instead of as fellow American citizens.

"Las Vegas and the rest of Nevada provide world-class recreation and entertainment, both indoors and outdoors.  If you want to take a well-deserved vacation, come to Nevada.  You may never want to leave.

"Obviously, the President doesn't particularly care that Nevada is represented by the Majority Leader of the U.S. Senate – because he remembers that Harry Reid doesn't stand up for his constituents."

Obama is reportedly paying a visit to Las Vegas later this month

UPDATE: In a letter to Sen. Reid tonight, President Obama clarified his comments today about Sin City but didn’t exactly apologize for them. The president said he “wasn’t saying anything negative about Las Vegas” when he chastised Americans for blowing “a bunch of cash on Vegas when you're trying to save for college.”

“I was making the simple point that families use vacation dollars, not college tuition money, to have fun,” Obama writes to the Senate Majority Leader. “There is no place better to have fun than Vegas, one of our country’s great destinations. I have always enjoyed my visits, look forward to visiting in a few weeks, and hope folks will visit in record numbers this year.”

- Karen Travers and Rachel Martin 

ABC News' Teddy Davis contributed to this report.

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