WASHINGTON — Declaring the American dream under siege, President Barack Obama delivered a populist challenge Tuesday night to shrink the gap between rich and poor, promising to tax the wealthy more and help jobless Americans get work and hang onto their homes. Seeking re-election and needing results, the president invited Republicans to join him but warned, “I intend to fight.”
In an emphatic State of the Union address, Obama said ensuring a fair shot for all Americans is “the defining issue of our time.” He said the economy is finally recovering from a deep and painful recession and he will fight any effort to return to policies that brought it low.
“We’ve come too far to turn back now,” he declared.
Obama outlined a vastly different vision for fixing the country than the one pressed by the Republicans confronting him in Congress and fighting to take his job in the November election. He pleaded for an active government that ensures economic fairness for everyone, just as his opponents demand that the government back off and let the free market rule.
Obama offered steps to help students afford college, a plan for more struggling homeowners to refinance their homes and tax cuts for manufacturers. He threw in politically appealing references to accountability, including warning universities they will lose federal aid if they don’t stop tuition from soaring.
Standing in front of a divided Congress, with bleak hope this election year for much of his legislative agenda, Obama spoke with voters in mind.
“We can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by,” Obama said. “Or we can restore an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules.”
At the core of Obama’s address was the improving but deeply wounded economy — the matter still driving Americans’ anxiety and the one likely to determine the next presidency.
“The state of our union is getting stronger,” Obama said, calibrating his words as millions remain unemployed. Implicit in his declaration that the American dream is “within our reach” was the recognition that, after three years of an Obama presidency, the country is not there yet.
He spoke of restoring basic goals: owning a home, earning enough to raise a family, putting a little money away for retirement.
“We can do this,” Obama said. “I know we can.” He said Americans are convinced that “Washington is broken,” but he also said it wasn’t too late to cooperate on important matters.
In a signature swipe at the nation’s growing income gap, Obama called for a new minimum tax rate of at least 30 percent on anyone making over $1 million. Many millionaires — including one of his chief rivals, Republican Mitt Romney — pay a rate less than that because they get most of their income from investments, which are taxed at a lower rate.
“Now you can call this class warfare all you want,” Obama said, responding to a frequent criticism from the GOP presidential field. “But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense.”
In a flag-waving defense of American power and influence abroad, Obama said the U.S. will safeguard its own security “against those who threaten our citizens, our friends and our interests.” On Iran, he said that while all options are on the table to prevent Iran from acquiring a nuclear weapon — an implied threat to use military force — “a peaceful resolution of this issue is still possible.”
With Congress almost universally held in low regard, Obama went after an easy target in calling for reforms to keep legislators from engaging in insider trading and holding them to the same conflict-of-interest standards as those that apply to the executive branch.
With the foreclosure crisis on ongoing sore spot despite a number of administration housing initiatives over the past three years, Obama proposed a new program to allow homeowners with privately held mortgages to refinance at lower interest rates. Administration officials offered few details but estimated savings at $3,000 a year for average borrowers.
Obama proposed steps to crack down on fraud in the financial sector and mortgage industry, with a Financial Crimes Unit to monitor bankers and financial service professionals, and a separate special unit of federal prosecutors and state attorneys general to expand investigations into abusive lending that led to the housing crisis.
At a time of tight federal budgets and heavy national debt, Obama found a ready source of money to finance his ideas: He proposed to devote half of the money no longer being spent on the U.S. military in Iraq and Afghanistan to “do some nation-building right here at home,” to help create more jobs and increase competitiveness. The other half, he said, would go to help pay down the national debt.
Obama will follow up Tuesday night’s address with a three-day tour of five states key to his re-election bid. On Wednesday he’ll visit Iowa and Arizona to promote ideas to boost American manufacturing; on Thursday in Nevada and Colorado he’ll discuss energy, and in Michigan on Friday he’ll talk about college affordability, education and training.
Printed on Wednesday, January 25, 2012 as: Economy top concern for the State of the Union