By Steve Holland and Irene Klotz
CAPE CANAVERAL, Florida (Reuters) - President Barack Obama sought to blunt criticism of his new space policy on Thursday by telling NASA employees his plan would save some jobs and advance exploration of the solar system.
Obama laid out his case on a visit to Kennedy Space Center, where a sense of a looming crisis has taken hold because thousands of jobs are drying up when the space shuttle is retired at the end of the year. Many also fear the U.S. space program will no longer be a world leader.
Obama told a crowd of about 200 people at Kennedy Space Center, a key source of jobs in the election battleground state of Florida, that he understood their worries and addressed some of the critics, who included Neil Armstrong, first man on the moon.
"The bottom line is, nobody is more committed to manned space flight, to human exploration of space, than I am. But we've got to do it in a smart way," Obama said to applause.
He said a $6 billion increase in NASA's budget will help ramp up exploration of the solar system, increase Earth-based observation to improve an understanding of climate change and bolster support for private space companies which he said have formed a bedrock of America's space programs.
To those who would return America to the moon as had been planned, Obama said: "I just have to say pretty bluntly -- we've been there before ... There's a lot more space to explore and a lot more to learn when we do."
Obama has faced sharp criticism for proposing to abandon the Constellation moon program after $9 billion has been spent and allocate $6 billion to support private companies in developing space rockets to carry astronauts to the International Space Station.
Getting a glimpse of what he hopes will be the future of the space program, Obama took a walk to look at a Falcon 9 rocket set to lift off in a test next month. It is a product of SpaceX, a private company, and company chief Elon Musk was on hand to tell Obama about the rocket.
In his speech, the president announced that he wants to accelerate development of a large, heavy-lift rocket to carry astronauts beyond low-earth orbit. He called for making a decision on the new rocket design in 2015.
"I think we can make the decision much sooner," said Florida Democratic Senator Bill Nelson, who accompanied Obama on the trip. "We're going to keep testing the monster rockets at Kennedy Space Center."
Obama stuck to his decision to cancel the Constellation program, designed by the previous Bush administration to return Americans to the moon but behind schedule.
He would salvage from Constellation a crew capsule called Orion, which was to carry astronauts to the moon but will serve instead as an emergency escape vehicle at the International Space Station.
That would free American astronauts from having to rely on Russia's Soyuz capsule to return to Earth in an emergency.
The Obama administration estimates the new plan would create an estimated 2,500 jobs in the Cape Canaveral area.
To ease the transition for workers dislocated, Obama proposed a $40 million fund to help transform the regional economy around NASA's Florida facilities and prepare its workforce for new opportunities.
The skeptical and disheartened community expects to lose 9,000 Kennedy Space Center jobs when the shuttle program ends and Constellation is shut down.
Another 14,000 job losses could take place in related industries, including restaurants, hotels and retail shops.
"It's not just the local community that will be affected. It'll be the whole nation. We won't be No. 1 in space anymore," said Karan Conklin, who oversees the U.S. Space Walk of Fame Museum in Titusville, Fla.
"After 50 years of manned spaceflight, now all of a sudden in what seems like a weekend, it's gone."
The changes prompted Apollo 11 astronaut Armstrong to emerge briefly from his habitual reclusion to complain that the U.S. space program, long the world leader, was at risk of being reduced to a "second or even third rate stature."
"Without the skill and experience that actual spacecraft operation provides, the USA is far too likely to be on a long downhill slide to mediocrity," he said in letter to NBC writtenly jointly with astronauts James Lovell of the Apollo 13 mission and Eugene Cernan of the Apollo 17 mission.
Armstrong's Apollo 11 colleague, Edwin "Buzz" Aldrin, however, has backed Obama's new plan.
Aldrin flew with the president to Cape Canaveral on Air Force One, which landed on the space shuttle landing strip.
(Editing by Cynthia Osterman)