COSTA MESA — The California economy and AIG bonuses were on the mind of President Barack Obama on Wednesday when he appeared at a town hall-style gathering in Costa Mesa at the start of a two-day visit to the Southland.

In his opening remarks at the spirited gathering at the Orange County fairgrounds in Costa Mesa, the president took full responsibility for the millions of dollars in retention bonuses paid to the insurance company’s executives shortly after it received billions of dollars from the taxpayers via a federal bailout.

“It’s hard to understand that a company that is relying on extraordinary assistance from taxpayers to keep its doors open would be paying anybody lavish bonuses,’’ he said. “It goes against our most basic sense of what’s fair and what’s right. It offends our values.’’

But the president said the buck stops with him.

“Listen, I’ll take responsibility,’’ he said. “I’m the president. We didn’t draft these contracts. We’ve got a lot on our plate, but it is appropriate when you are in charge to make sure that stuff doesn’t happen like this.’’

Obama also tried to offer words of hope for a state facing high unemployment, teacher layoffs and other financial problems.

“One out of every 10 Californians is out of work right now,’’ he noted. “You’ve got one of the highest foreclosure rates in the nation. Budget cuts are threatening the jobs of thousands of teachers across the state. But here is what I want you to know — we are not only going to make it through this crisis, we are going to come out on the other side a stronger and more prosperous nation.’’

After making brief remarks that were repeatedly interrupted by fans yelling “we love you’’ and chanting “O-bam-a,’’ the president answered questions for nearly an hour in the sweltering weather, garnering applause when he said he was going to take off his jacket because of the heat.

Only about a half-dozen protesters were seen at the event in what is considered Republican turf, but security was high.

When asked how the federal government’s stimulus package will help teachers who are in danger of losing their jobs. Obama said the funds are intended to retain teachers. However, he said keeping teachers in their jobs is just one part of the educational equation.

“We’ve got to provide better teacher training. There are teachers who may not know their subject matter as well as they should. They’ve got to be given more time for professional development. We’ve got to have more flexibility, I believe, in terms of how we reward teachers,’’ Obama said.

Questioned on the issue of organized labor, the president said actions need to be taken to ensure that employee wages keep pace with the cost of living, something that did not happen over the last decade.

“All I’m trying to do is restore some balance to our economy so that middle class families who are working hard —  they’re not on welfare, they’re going to their jobs every day, they’re doing the right things by their kids — they should be able to save, buy a home, go on a vacation once in a while,’’ Obama said. “They should be able to save for retirement, send their kids to college. That’s not too much to ask for, that’s the American dream.’’

Obama also answered a question on the sensitive issue of immigration.

He said it is “intolerable’’ for a half-million illegal immigrants to cross the border each year, and that there needs to be a crackdown on employers who employ illegals. But he also said there needs to be a pathway to citizenship for undocumented workers, and that the entire issue must be tackled at the same time or it won’t work.

Obama also brushed off criticism that he is attempting to solve too many problems at one time.

“When you’re president, you’ve got to walk and chew gum at the same time,’’ he said.

The town hall meeting was the first stop on Obama’s two-day visit to the Southland — his first since becoming president — that includes a second town hall meeting, a tour of an electric vehicle plant in Pomona and an appearance on “The Tonight Show with Jay Leno.’’

The “Tonight Show’’ visit will mark the first time a sitting president has appeared on a late-night talk show.

Air Force One landed at Long Beach Airport around 3 p.m., and Obama headed to Costa Mesa to lead the first town hall meeting in Building 12 of the Orange County Fair and Event Center.

“It is always good to get out of Washington for a little while and come to places like Costa Mesa. The climate is a lot nicer, and so is the conversation,’’ he told the enthusiastic crowd.

Thousands of people lined up at the fairgrounds Monday night and Tuesday morning, hoping to get some of the limited free tickets for the event. Most left disappointed, with only few hundred people at the front of the line walking away with tickets.

On Thursday, Obama will take a private tour of the Edison International Vehicle Electrics Plant in Pomona. Thursday afternoon he will lead another town hall at the Miguel Contreras Learning Complex near downtown Los Angeles. Tickets for that event were given away by a lottery.

Los Angeles Mayor Antonio Villaraigosa will introduce the president at the second town hall, according to his office. Gov. Arnold Schwarzenegger is also expected to attend.

Thursday night, Obama will appear on “The Tonight Show.’’ According to a statement from NBC, Obama will discuss his economic plan.

Obama will depart from Long Beach Airport at 6 p.m. Thursday.