SOUTH BEND -- There's a lot of smart people in Washington, Sen. Evan Bayh says, but sometimes nothing beats a little Midwest wisdom.

"Very often you don't have as much practical knowledge in Washington," the junior Indiana senator said Wednesday. "It's a lot of theory, but not always a lot of common sense."

The Democrat spent about two hours in South Bend on Wednesday, meeting with area business, labor and government officials.

He was there, he said, to listen to local leaders' ideas about how to cure the nation's many ills -- high unemployment, the housing crisis and frozen credit markets.

"I'd rather do more listening, rather than talking," he said.

Bayh said he heard lots of practical solutions Wednesday while in Fort Wayne and South Bend, especially ideas on lowering the cost of health care and reducing unemployment.

Once the Barack Obama administration takes over in January, he said, they'll be looking to immediately fund what Bayh called "two-fers" -- 2-for-1 types of projects that get people working while also improving America's long-term growth potential.

Indiana can be integral in that development, Bayh said. There are plausible ways here, he said, to lower health care costs through electronic record keeping and billing, as well as infrastructure and public works projects that will be set to start when Obama takes office.

The state can be on the forefront of energy efficiency, he said, as it's ideally situated to produce biofuels as well as hybrid and electric cars.

"I'd expect a broader energy bill coming early next year," he said, "and Indiana can be a part of that."

With Congress adjourned until next month, Bayh is spending the week making similar stops across the state. He visited Fort Wayne on Wednesday, will stop in Richmond, Evansville and Jeffersonville today and heads to West Lafayette and Indianapolis Friday.

He expressed disappointment over the Senate's failure last week to pass a $14 billion rescue plan for the nation's Big Three automakers.

A General Motors or Chrysler bankruptcy would be disastrous for Indiana, he said. The state has the third-highest number of auto-related jobs, he said, and as many as 140,000 people could be unemployed if the companies go under.

"They can't go down," he said. "We'll lose too many jobs if they do."

Bayh said he hopes the Treasury Department will loan GM and Chrysler enough money to survive until January, when the new Congress can work on a long-term solution.

But the senator emphasized that throwing money at the companies is not the answer, and a practical fix must be found soon.

"The bottom line," he said, "is I don't know how long they'll last, but they don't have long."

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