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MADISON, Wisconsin (Reuters) - Wisconsin state Senate Democrats fled the state on Thursday to protest a Republican plan to sharply curtail union rights for public employees, and President Barack Obama weighed in on their side.

"We were left with no choice," Democrat Sen. Jon Erpenbach said of the decision to leave Wisconsin rather than debate the plan in the legislature. He was speaking to WisPolitics, an online news service.

Asked when the Democrats would return, Erpenbach said, "The question is when are the Republicans going to sit down seriously with the other side on this issue and try to work something out."

Republican Gov. Scott Walker proposed sharply curbing the bargaining rights of public unions in order to make immediate budget savings. The move sparked outrage among union workers who protested at the Wisconsin state house this week.

Speaking about the issue Thursday in a television interview, President Barack Obama said that while he understands state governments' need to make cuts, the Wisconsin proposal seems like "an assault on unions."

"Some of what I've heard coming out of Wisconsin, where you're just making it harder for public employees to collectively bargain generally, seems like more of an assault on unions," Obama said.

Capitol police estimated 25,000 people, many carrying signs protesting the Republican plan, converged on the state Capitol building on Thursday, including 5,000 packed inside. The protests, which began on Monday, have grown in numbers every day this week, police said.

Scheduled debate on the proposal was scrapped because a quorum of 20 senators was needed and there are 19 Republicans. The state House of Representatives also has a Republican majority.

Walker issued a statement Thursday calling Democratic legislators "disrespectful" and calling on them to return to work.

Harley Shaiken, a labor professor at the University of California, Berkeley, said that Wisconsin pioneered collective bargaining for state workers in the 1960s.

"All this is taking place against a backdrop of mass protest in Cairo and elsewhere where people are trying to form unions..." said Shaiken. "It's an unusual moment with high stakes -- and not just for Wisconsin ... It has huge political implications."

U.S. state and local governments are struggling to balance their budgets this year, after the recession decimated their finances. Some states such as Wisconsin, Texas, Arizona and Ohio are trying to make deep cuts in spending to balance the books. Others such as Minnesota and Illinois, are raising taxes.

In Ohio, where the state Senate is considering a similar law known as SB5 that would eliminate collective bargaining for many state workers, thousands of demonstrators, some carrying signs that read "Kill SB5" or "Stop SB5" packed the lawn outside the state Capitol.

Among the protesters was former Ohio Governor Ted Strickland, a Democrat who lost the election last year to Republican John Kasich, who supports the measure.

By late afternoon, the Ohio protesters had moved into an atrium adjacent to the old state Capitol where loudspeakers were set up to monitor the debate inside the Senate chamber.

Many Wisconsin schools throughout the state closed Thursday -- the second consecutive day in the capitol of Madison -- after the state's largest teachers union called for members to join the protests at the state Capitol.

"This is not about protecting our pay and benefits. It is about our right to collectively bargain," teacher's union President Mary Bell said.

A component of Walker's plan that calls for a bond restructuring put the legislation on the fast track for approval. The governor wants the state to push principal payments on its general obligation bonds into future years to save $165 million.

Because those payments are due on March 15, the bill must be passed by February 25 to allow for time to sell the debt. The deal would involve about $210 million of bonds priced through lead underwriter Citigroup, according to Frank Hoadley, the state's capital finance director.

Senate Joint Finance Committee co-chair Alberta Darling, said the choice facing Wisconsin was either to get the concessions from unions, or lay off public employees.

"It's not like we're choosing to do this. We are broke," she said.

The Wisconsin battle is gaining national attention, with both liberal and conservative talk shows highlighting the issue and saying that this is a national fight over union rights.

The Wisconsin boycott is reminiscent of 2003, when Republicans took control of the Texas Legislature. Texas House Democrats fled to Oklahoma to avoid a vote on congressional redistricting.

The move blocked the Texas House from acting for four days. Senate Democrats later traveled to New Mexico, also to prevent a redistricting vote. Despite the Democrats' efforts, redrawn maps that favored Republicans, and were backed by then-U.S. House Majority Leader Tom DeLay, ultimately passed.

(Writing by Mary Wisniewski; reporting by Jeff Mayers in Madison, Jim Leckrone in Columbus, Corrie MacLaggen in Austin and Andrew Stern, James Kelleher and Karen Pierog in Chicago; editing by Greg McCune)

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STATE DEFICIT WOES

Democratic President Barack Obama weighed in during a television interview, saying while he understood that state governments needed to make cuts, the Wisconsin proposal "seems like more of an assault on unions."U.S. state and local governments are struggling to balance their budgets this year, after the recession devastated their finances. Some states such as Wisconsin, Texas and Arizona are trying to make deep cuts in spending to balance the books. Others such as Minnesota and Illinois are raising taxes.

In Ohio, where the state Senate is considering a similar law that would eliminate collective bargaining for many state workers, thousands of protesters packed the lawn outside the state Capitol in Columbus.

Wisconsin Senate Joint Finance Committee co-chair Alberta Darling, said the choice facing Wisconsin was either to get the concessions from unions or lay off public employees.

"It's not like we're choosing to do this. We are broke," she said.

Harley Shaiken, a labor professor at the University of California, Berkeley, said Wisconsin pioneered collective bargaining for state workers in the 1960s.

"All this is taking place against a backdrop of mass protest in Cairo and elsewhere where people are trying to form unions," he said. "It's an unusual moment with high stakes -- and not just for Wisconsin. ... It has huge political implications."

The Wisconsin boycott is reminiscent of 2003, when Texas House Democrats fled to Oklahoma to avoid a vote on congressional redistricting.

The quorum-busting move blocked the Texas House from acting for four days. Senate Democrats later traveled to New Mexico to prevent a redistricting vote. Despite their efforts, redrawn maps that favored Republicans ultimately passed.