The Political Snitch

Obama outlines 'mission' of rebuilding American dream, as hurdles await his election-year agenda

2012-01-25T04:30:00.001-08:00

President Obama heads out on the road Wednesday to visit battlegrounds states where he will try to sell his agenda, and his reelection bid, outlined in a lengthy address to Congress and the nation on Tuesday night.

In his annual State of the Union address, President Obama suggested Americans try to follow the lead of U.S. military forces. He said Americans must get past personal ambition and partisan obsession to "focus on the mission at hand": keeping alive the American dream by restoring the U.S. economy.

Â The president said that the "defining issue of our time" is finding the means to uphold the promise that if people work hard, they will succeed.

"No challenge is more urgent. No debate is more important. 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. 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," he said.

But the devil is in the details, and Republicans are unlikely to agree to many of the proposals the president laid out. Indiana Gov. Mitch Daniels, who delivered the GOP response, said that the president's rigid adherence to ideology was suffocating innovation.

"We do not accept that ours will ever be a nation of haves and have nots; we must always be a nation of haves and soon to haves," Daniels said.

In a speech heavy in focus on manufacturing, job training and tax reform, Obama said Tuesday that the most immediate priority for a divided Congress is to stop a tax hike on 160 million working Americans and prolong a payroll tax cut set to expire next month.Â

At the same time, Obama proposed raising taxes on the wealthiest Americans. He said anyone who makes more than $1 million a year should not pay less than 30 percent in federal taxes and should get no special subsidies or deductions.

"Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else? ... Because if we're serious about paying down our debt, we can't do both," he said.

Saying that the country can get its mojo back, the president said the "house of cards" collapsed in 2008 as a result of mortgages being sold to people "who couldn't afford or understand them," banks that bet using other people's money and profited either way and regulators who looked the other way or didn't have the authority to stop the bad behavior.Â

Since then, he said, American manufacturers are hiring again and new rules have been put in place to hold Wall Street accountable.Â

"The state of our union is getting stronger, and we've come too far to turn back now" Obama said.

While the president wants to look at the "sunny side," Daniels said the president was elected to fix problems he did not cause, but "he cannot claim that the last three years have made things anything but worse."

"When President Obama claims that the state of our union is anything but grave, he must know in his heart that this is not true," Daniels said.

Daniels also focused heavily on the entitlement system that is paying out far beyond what it can afford.

"It's absolutely so that everyone should contribute to our national recovery, including of course the most affluent among us. There are smart ways and dumb ways to do this: the dumb way is to raise rates in a broken, grossly complex tax system, choking off growth without bringing in the revenues we need to meet our debts. The better course is to stop sending the wealthy benefits they do not need, and stop providing them so many tax preferences that distort our economy and do little or nothing to foster growth," he said.

The president said a new American economy must be "built to last" through government and financial systems that play by the rules and give everyone a fair shot. Borrowing the slogan from General Motors, the president called for restoring the economy and ending favoritism.Â

"What's at stake are not Democratic values or Republican values, but American values. We have to reclaim them," he said.

Offering an array of suggestions for getting businesses to start hiring in the U.S. again, the president suggested incentivizing in-sourcing by doubling tax deductions for high-tech manufacturers that make products in the U.S., and extra help with financing for relocating in hard-hit communities.Â

"Ask yourselves what you can do to bring back jobs to your country and your country will do everything it can to help you succeed," he said.

The president added that companies that outsource jobs should not get a tax break while every "multinational company should have to pay a basic minimum tax."Â

"And every penny should go towards lowering taxes for companies that choose to stay here and hire here," he said.

The president challenged lawmakers to pass several proposals that are unlikely to get any pick-up this election year. Obama called for Congress to pass comprehensive immigration laws, make college education cheaper and "double down" on clean energy.

Recognizing that differences in Congress are too deep to pass climate change legislation, Obama said he is directing the development of clean energy on public land and announced that the Navy will purchase enough capacity to power a quarter of a million homes each year..

He called on Congress to fund "great projects" using half the money "we're no longer spending at war" and use the other half to pay down the debt.Â

Though he requested Congress grant him authority to take several action, the president, who rehearsed his presentation with a weekend video to supporters that was prepared by his re-election team, acknowledged that the cynicism for action is great. Â

He said while he's willing to cooperate with Congress, he will notÂ let Republicans hold up his plans.

"I intend to fight obstruction with action," he said.Â "With or without this Congress, I will keep taking actions that help the economy grow. But I can do a whole lot more with your help."

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.

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."

Adding that the flag that the Navy SEALs team took with it on the mission to get bin Laden is his proudest possession, the president said inevitably it falls on everyone to help lift the country.

"This nation is great because we get each other's backs," he said.Â

State of the Union, SOTU on OTUS, Class Confrontation, Mitt's Millions, Warren Buffett's Secretary, Planet Obama (PM Note)

2012-01-25T04:00:00.001-08:00

ABC Newsâ Z. Byron Wolf (@zbyronwolf) reports:

Tonight: State of the Union â" Thatâs SOTU in DC Speak. Keep up with it on OTUS News http://http://bit.ly/sj5NiO

Weâll be on a new frontier of user engagement with Snappy TV. Make your own clips of the speech. See ours in real time.

Also at OTUSnews.com â" Live analysis from Nightline Anchor Terry Moran, ABC Political Director Amy Walter and Yahoo DC Bureau Chief David Chalian.

Secretaries at SOTU â" Secretary of State, Secretary of Defense, Warren Buffettâs Secretary: http://abcn.ws/xDrvq3

Confrontation on Tax Fairness: Obama to Congress â" from Devin Dwyer â" Obama will use his third State of the Union Address to promote what aides describe as a populist economic agenda that heâs already spent weeks pitching directly to voters, insisting the ideas deserve bipartisan support. Now, in the face of what heâs framed as Republican obstruction, Obama will draw an election-year line in the sand. This is a âmake-or-break moment for the middle class and folks trying to work their way into the middle class,â Obama said, previewing the address in a video posted on his re-election campaign website and emailed to supporters. âBecause we can go in two directions: One is towards less opportunity and less fairness, or we can fight for where I think we need to go: building an economy that works for everyone, not just a wealthy few.â http://abcn.ws/AaESWQ

Theme: America Built to Last â" Sounds like a car commercial.

First Ladyâs Box â" An Astronaut, a science teacher -Â Michelle Obama will watch her husbandâs State of the Union address surrounded by some familiar (and not-so-familiar) names â" http://abcn.ws/xVEHMY

The Hottest Seat in Town â" Jon Karl on how lawmakers get an aisle seat â" http://abcn.ws/zAUNFh

A Different World â" Boehner calls politics of the Obama administration âalmost un-American,â says he and the president hail from different metaphorical planets and speak a different language.Â More from Jonathan Karl â" http://abcn.ws/whYhH5

Planet Obama â" Newt Gingrich draws largest crowd of his campaign and mocks âPlanet Obamaâ â" From Falcone/Saenz â" http://abcn.ws/w6xNt5

Sensing an Obama as alien theme from the current and former speakerâ¦

RSVPeeved â" Who is snubbing President Obama? From defensive linemen to supreme court justices, our report from Amy Bingham. â" http://abcn.ws/xW888E

OTUS Political Stock Market â" Newt Gingrich is within about 4 of Mitt Romney at our OTUS political stock market. Thatâs a new high for Gingrich. But both men are well behind Obama. http://bit.ly/sj5NiO

Mittâs Millions -$42 million â10, â11 Income, 13.9 percent tax rate â" http://abcn.ws/wJKrIu

Tax Rates Thru Time: What Mitt Romney would have paid under past Presidents â" http://abcn.ws/zsxEOW

â¦the .006 Percentâ¦ http://abcn.ws/yTVPvX

What $21 Million Buys â" What could Romneyâs $21.7 million yearly income buy? http://abcn.ws/zjZ9ig

Newt Gingrich: The Lobbyist Who Wasnât There â" Matt Negrinâs report on what we know about Newtâs involvement with Freddie Macâ¦ The technicalities are a bit arcane and muddied. Gingrich never officially registered himself as a lobbyist, but he did meet with elected officials to talk about legislation related to Freddie Mac. According to the federal governmentâs lobbying rules, people who spend at least 20 percent of their time lobbying are officially lobbyists. But itâs virtually impossible to measure or enforce that. âItâs totally fudge-able and totally nebulous,â said Meredith McGehee, the policy director at the Campaign Legal Center, which advocates for ethics changes. http://abcn.ws/ylNccg

Romney Defines âInfluence Peddlingâ â" Per Emily Friedman, hereâs what he said at a foreclosed-upon house in Lehigh Acres, Florida: One thing I know he was doing is that he was standing up as the former speaker of the house and someone who many people respected as a conservative leader, he was standing up and defending Freddie Mac and Fannie Mae and so conservatives in congress and conservatives around the country instead of arguing to get rid of these entities to scale them back and let the free market work they said well if Newt Gingrich thinks itâs a good idea why we oughtta go along with it. Thatâs whatâs known as influence peddling. You get paid and then you go out and say things that influence other people

June Nominee? â" Jake Tapper explains why the GOP race could last until June, and why Democrats would be thrilledÂ â" http://abcn.ws/AqZK75

Power Players â" Jake Tapper Behind the Scenes on Obamaâs Disney Trip â" http://abcn.ws/ydgi09

Newt Gingrich uses anti-Charlie Crist rhetoric to bash Mitt Romney in Florida â" Arlette Saenz â" Â http://abcn.ws/zLLfCC

Mitt Romney on Tuesday charged that Obamaâs State of the Union would be nothing more than re-election rhetoric from a âdesperate chief.â More from Emily Friedman â" http://abcn.ws/xQei4l

ABCâs Matthew Dowd on the mood of the country â" A Yearning for the Past? http://abcn.ws/zLIkEA

The State of the Union Isâ¦? Â Republicans speculate on the contents of President Obamaâs address, as well as offer their own opinions on state of the union. http://abcn.ws/yxawPr

Senate GOP Hammers Obamaâs State of Union, Pre-Delivery â" http://abcn.ws/A9CeP1

Santorum says Obamaâs speech will just be âflowery rhetoricâ â" http://abcn.ws/ABs3QG

ABCâs Alexa Keyes contributed to this report.

Santorum: 'I Wish I'd Made a Gazillion Dollars Last Year'

2012-01-25T03:30:00.001-08:00

Jan 24, 2012 7:29pm

PUNTA GORDA, FLA. â" GOP contender Rick Santorum does not begrudge Mitt Romneyâs recently revealed wealth, telling a Tea Party crowd here that he wishes he had also made a âgazillion dollars.â

âPeople ask me, âWhat do you think about Mitt Romney, you know, making a gazillion dollars last year?â Good for him, thatâs what I say, good Â for him. I wish Iâd made some gazillion dollars last year. Iâd be in a little better shape financing my own campaign,â he said just hours after Romney released his much anticipated 2010 and 2011 tax returns.

Romney, who has faced pressure for weeks to release his returns, revealed he had made $42.5 million in the past two years. But he paid only 13.9 percent in taxes on the 2010 income, and the rate for his 2011 income is a projected 15.3%.

Addressing a crowd of about 300 people under a balmy Florida sun, Â Santorum did not wear his signature sweater vest and tried to get away from the persona that he is a buttoned-up Mr. Nice Guy.

Instead, Santorum insisted he could be âmeanâ and had earned a reputation as a âbomb throwerâ during his two terms in the Senate.

âThank you for thinking Iâm such a nice guy,â Santorum told a woman who asked if he was tough enough to âkick some buttâ in Washington. Â âThe attitude, itâs so funny because when I was in Congress I was Â known as a bomb thrower. I was known as the guy that would come in and blow things up.â

Asked to comment on Sen. Rand Paulâs reported detention by the TSA before catching a flight to Washington, Santorum admitted he joked with Paulâs father-candidate, Ron Paul, at Monday nightâs GOP debate.

Santorum said that rather than shaking Ron Paulâs hand before the debate started, he instead played a joke, pretending to frisk him Â instead.

âYou know, I said hello to Romney, and I said hello to Newt, and then I Â saw Ron Paul and I went over and I frisked him. And said I want to make sure Iâm safe with you here, Ron, todayâ¦. We both had a big laugh at that,â he said.

Obama State of the Union Makes Case for Economic 'Fairness'

2012-01-25T03:00:00.001-08:00

President Barack Obama tonight presented an argument for his presidency and a second term with a State of the Union address that outlined a sweeping vision for American exceptionalism sustained by an economy rooted in "fairness."

"The defining issue of our time is how to keep that promise alive. No challenge is more urgent. No debate is more important," Obama said of the need to enact an agenda that bolsters the middle class.

"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. 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," he said.

"What's at stake are not Democratic values or Republican values, but American values," he added. "We have to reclaim them."

Obama's moment in the spotlight and on the national stage came at a crucial moment in his first term, with the economy showing continued signs of progress, his job approval ratings up slightly, and his Republican rivals divided over choosing their nominee.

Obama seized the opportunity to highlight his accomplishments over the past three years and "set the tone" for his re-election campaign, tacitly framing the November election as a choice between two starkly different political philosophies, rather than a referendum on his controversial tenure.

Jim Watson/AFP/Getty Images

US President Barack Obama delivers his annual... View Full Size

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The president accentuated themes from a fiery populist speech he delivered in Kansas in December, telling his audience because of his economic and foreign policies "the state of our Union is getting stronger."

"We've come too far to turn back now," he said.

At the heart of Obama's case for the restoration of "American values" was formally imposing the so-called Buffett Rule -- the idea that millionaires and billionaires should not pay a lower percentage rate in taxes than members of the middle class.

"You can call this class warfare all you want. But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense," he said, calling for a new legal requirement that Americans making more than $1 million a year pay a minimum effective tax rate of at least 30 percent.

The secretary of billionaire investor Warren Buffett was a the guest of first lady Michelle Obama this evening so as to illustrate that point made by her boss. (See the full list of guests in the first lady's box.)

Obama also discussed proposals to boost American manufacturing, invigorate energy production and expand the skill sets of U.S. workers that included a series of new taxes and new spending measures as well as at least two new government departments.

He called for an end to tax deductions for housing, health care, retirement and child care for millionaires and the elimination of federal subsidies, such as food stamps, for the same, an idea put forth by Republican Sen. Tom Coburn of Oklahoma.

Adding details to an idea he hinted at last week, Obama called for an end to tax incentives for companies that move work overseas or shut down their factories, while proposing new, lower overall tax rates for U.S. manufacturers, particularly those that relocate factories to economically hard-hit communities.

"It's time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America," he said. "Send me these tax reforms, and I'll sign them right away."

Obama State of the Union Address to Make Pitch for Economic Fairness

2012-01-25T02:30:00.001-08:00

WASHINGTON â" President Obama, confronting a Congress where Republicans have been determined to stymie him, will use his third State of the Union address on Tuesday night to offer a populist pitch for greater economic fairness as part of his re-election campaign.

âWe can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by,â Mr. Obama says in brief excerpts of the speech released by the White House Tuesday evening. âOr 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.â

For weeks, Mr. Obama and his aides have been signaling that the theme of Tuesdayâs speech, scheduled to begin at 9 p.m. Eastern time, would be that the richest Americans should shoulder more of the nationâs tax burden, that the middle class should have a shot at prosperity and that the disadvantaged should be provided social scaffolding to help them climb upward.

And while Mr. Obamaâs themes are cast in terms of seemingly universal appeal, like economic fairness, fiscal frugality, efficiency in government and national pride, on almost every point there are profound differences between the political parties that no number of applause lines can really bridge.

And he will repeat â" this time, directly to a Congressional audience â" his frequent warnings on the campaign trail that he would use executive powers to force action where he can.

âI intend to fight obstruction with action, and I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place,â he will say.

Indeed, there is little prospect that the administration will be able to break the pervasive gridlock with Congress on many of the substantive issues the speech highlights. Still, the speech, which is expected to be watched by one of the biggest audiences the president may receive before the November election, comes just as the election campaign reaches a boil, with his leading Republican opponents in a full-throated competition over how best to defeat the president.

House Speaker John A. Boehner, who will sit behind Mr. Obama, said after a meeting of his caucus on Tuesday that he expected the presidentâs speech to be âa rerun of what we have seen before.â

Some of the themes in the speech were personified in the guests invited by the White House to sit in Michelle Obamaâs box overlooking the cavernous House chamber. There will be Debbie Bosanek, the secretary to Warren E. Buffett, a poster-child for Mr. Obamaâs thesis that it is unfair to tax an ordinary worker at higher effective rates than her billionaire boss. Alongside her will be 20 extraordinary and ordinary people drawn from commerce, education, technology, politics, the military and the struggling working class.

Not to be outdone, Mr. Boehner announced that he would welcome as visitors to the Capitol tonight a group of energy business managers whose enterprises are being hurt by the Obama administrationâs refusal to approve the cross-country Keystone XL pipeline.

So it will go, blow by blow, in an event that for all its ceremonial staging is also a political prize fight.

âTonight, I want to speak about how we move forward, and lay out a blueprint for an economy thatâs built to last â" an economy built on American manufacturing, American energy, skills for American workers, and a renewal of American values,â Mr. Obama will say.

âWhatâs at stake are not Democratic values or Republican values,â he plans to say, âbut American values.â But the differences between the parties are in fact as sharp as ever, especially on the subject of taxes, where his proposals â" the latest formulation of a policy that would limit tax breaks for millionaires without raising taxes on the less wealthy â" run directly counter to those of the Republicans.

And if both sides agree, for example, that American reserves of natural gas should be exploited, there is much less agreement on how the nationâs fossil fuels should be developed and transported, or about how alternative forms of energy should be encouraged.

If Mr. Obama chooses, as expected, to support consumer protections and enforcement actions taken under landmark financial regulations passed during his first term, or to recommend new efficiencies in government, Republicans counter with calls to repeal the law â" and to abolish entire federal agencies.

The formal Republican response is to come from Gov. Mitch Daniels of Indiana, chosen by the Republican leaders because of his record on taxes and spending.

Not waiting for Mr. Obama to speak, they responded in some detail hours before his delivery.

Mitt Romney, a leading contender for the Republican presidential nomination, said in a speech of his own on Tuesday that the presidentâs address was nothing but âpartisan plans for his re-election campaignâ and âtall tales about America.â

âPresident Obama has amassed an actual record of debt, decline and disappointment,â Mr. Romney said. âInstead of solving the housing crisis and getting Americans back to work, President Obama has been building a European-style welfare state.â

Mr. Boehner said, âThe presidentâs policies have made our economy worseâ and predicted that Mr. Obama would âdouble down on what hasnât worked.â

Lawmakers sometimes call a truce on the occasion of the presidentâs annual address to Congress. But Republican comments on Tuesday suggested that the president would receive a cool reception from some prominent members of the party.

âThe presidentâs policies have failed,â said Representative Jeb Hensarling of Texas, the chairman of the House Republican Conference. âThatâs why heâs resorting to policies of envy and division.â

All day long, the White House signaled that the president would insist, as he has done many times before, that wealthier households should be shouldering more of the burden.

âWe are going to outline that specifically tonight,â said David Plouffe, a senior White House adviser, on ABCâs âGood Morning America.â âThe point is, we need to change our tax system. We need to make sure that middle-class workers are not paying more in effective tax rates than people who are making forty, fifty, a hundred million dollars a year.â

Editorial Board: State of the Union speech is full of soaring rhetoric but skips over some major challenges

2012-01-25T02:00:00.001-08:00

Aâ STATE OF THE UNION address from a president seeking reelection is always an odd event. Especially in the face of a divided Congress, the presidentâs proclaimed program stands little chance of enactment. The ambitious agenda of years past gives way to the knowledge, born of painful experience, of how difficult that will be to achieve. Meanwhile, the presidentâs proposals are made in the context of the race about to be joined, stacked up against the pie-in-the-sky promises of his opponents. The subtext is, inevitably, less a blueprint of the year to come than an explanation of why the president deserves reelection and a sneak preview of a second-term agenda.

In that context, President Obamaâs speech Tuesday night combined soaring rhetoric with crowd-pleasing, often small-bore proposals. Mr. Obama spoke movingly about the eroding economic security of much of the middle class. Building on themes he sounded a few months ago in Osawatomie, Kan., the president argued against, as he put it, âsettl[ing] for a country where a shrinking number of people do really well, while a growing number of Americans barely get by.â To raise this issue is not, as former Massachusetts governor Mitt Romney (R) asserted even before the presidentâs speech, âdivisive rhetoric from a desperate campaigner in chief.â

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The presidentâs biggest new idea was attaching a number to his previously articulated âBuffett Ruleâ â" billionaire Warren Buffettâs position that he should not pay a smaller share of his income in taxes than his secretaryâs; she was in attendance in the first ladyâs box. Mr. Obama announced that not only billionaires but all those earning $1 million or more a year should pay at least 30 percent of their income in taxes. Think of this as a new version of the alternative minimum tax.

This position sets up a politically useful contrast between Mr. Obama and Mr. Romney. It is not a fleshed-out proposal that the administration expects, for example, to produce as a line item in the forthcoming budget. Administration officials could not tell us how much revenue such a change would produce. But Mr. Obama is right to take on the unlevel and distorting playing field of a code that taxes ordinary earned income at a much higher rate than investment income.

Mr. Obama has said he wants to make the tax code simpler, but his proposals would further complicate it, adding or reshuffling preferences for manufacturing. This kind of picking and choosing between manufacturing and other businesses, or between different kinds of manufacturers (the president said he wants to double the deduction for high-tech manufacturers), or between towns that have lost factories and towns that havenât, introduces needless complexity into an already unwieldy code. It also relies on a vision of manufacturing as an engine of jobs that may not be realistic in an age of increasingly automated factories.

Once again Mr. Obama slighted the threat that the federal deficit poses to the growth he said he wants. As with last yearâs State of the Union speech, when he relegated the debt to a near-aside late in the speech, Mr. Obama did not go beyond a rhetorical nod to the issue. Indeed, in arguing for increased investment in U.S. infrastructure â" a worthy idea â" Mr. Obama gave up on the traditional approach of paying with an increase in the gasoline tax or similar user fees. Instead, he relied on the dodge of âpaying forâ those costs by using some of the savings from winding down operations in Iraq and Afghanistan. The administration is right to be frustrated by congressional unwillingness to consider real pay-fors, but wrong to respond with a measure that would just make the deficit worse.

Mr. Obamaâs discussion of foreign policy focused on the two achievements likely to be a major focus of his election campaign, the withdrawal of the last troops from Iraq and the killing of Osama bin Laden. He vowed that America would remain (borrowing President Clintonâs phrase) the one âindispensableâ nation, even as he cuts a half-trillion dollars from the military budget. The president did not hint at any significant foreign policy initiatives for the coming year; even on Iraq, he failed to discuss future relations with that strategic oil producer, which has headed toward renewed internal conflict since the last U.S. soldiers pulled out.

Indiana Gov. Mitch Daniels, delivering the Republican rebuttal, had the fiscal question right when he said: âIf we drift, quarreling and paralyzed, over a Niagara of debt, we will all suffer, regardless of income, race, gender, or other category.â But his eloquence is undercut by his partyâs refusal, far more doctrinaire than Mr. Obamaâs, to entertain responsible proposals to pay for the nationâs needs.

Obama cranks up populist pitch

2012-01-25T01:30:00.001-08:00

President Obama used his election-year State of the Union address to issue a loud call for economic equality based on âresponsibility from everybody,â a theme prefacing his 2012 campaign message.

Cranking up the volume on the populist message that the wealthy should pay higher taxes, Obama said the goal of economic equality was a return to American values and âthe defining issue of our time.â

In the addressâ"dubbed a âBlueprint for America Built to Lastââ" a pugnacious Obama used the power of the bully pulpit before a sharply divided joint session of Congress to take the offensive and pledge that while he would work with lawmakers, he also intended to âfight obstruction with action.â

Repeating that he would not âback down,â Obama said, âno challenge is more urgentâ than to support the middle class.

âWe can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by 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,â Obama said. âWhatâs at stake are not Democratic values or Republican values but American values. We have to reclaim them.â

The address has been dubbed as the presidentâs first major stump speech of the year, and Obama took an indirect swing at GOP presidential candidate Mitt Romneyâ"who released his much anticipated tax returns earlier in the day-â"by renewing his call for the so-called âBuffett Rule,â named after billionaire investor Warren Buffett.

The rule seeks to ensure that middle-class workers do not pay a higher tax rate than their well-to-do bosses and Obamaâs proposal dictates that those making more than $1 million would pay a minimum effective rate of at least 30 percent, more than double the rate Romney expects to pay this year.

It would also eliminate tax deductions for those making more than $1 millionâ"including for housing, health care, retirement and child careâ"and would end federal subsidies such as food stamps and unemployment benefits for millionaires.

To drive the message home, Obama invited Buffettâs secretary Debbie Bosanek to attend; she sat with first lady Michelle Obama.

âNow you can call this class warfare all you want,â a feisty Obama said. âBut asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense.

âWe donât begrudge financial success in this country,â the president continued. âWe admire it. When Americans talk about folks like me paying my fair share of taxes, itâs not because they envy the rich. Itâs because they understand that when I get tax breaks I donât need and the country canât afford, it either adds to the deficit or somebody else has to make up the differenceâ¦Thatâs not right. Americans know itâs not right.â

Romney, who has seen his command of the GOP race unravel due to a surge in support for Newt Gingrich, offered a retort to Obama a half-day before the president delivered his address, ripping the president as the âCampaigner-in-Chiefâ to an audience in Florida for using the State of the Union to âdivide our nation.â

Indiana Gov. Mitch Daniels, who delivered the formal GOP response to Obama, also criticized the president for his divisive rhetoric. He said Itâs ânot fair and itâs not trueâ for Obama to cast congressional Republicans as obstacles.

The address on Tuesday night had a much different air from the one which took place last year, in the days after the attempted assassination of Rep. Gabrielle Giffords (D-Ariz.) when lawmakers in both parties sought to ease tensions and put aside the vitriol that became commonplace on Capitol Hill.

While the chamber gave Giffords a rousing standing ovation upon her arrival on Tuesday night, Obama was met with a partly grim-faced crowd when he discussed his prioritiesâ"including a renewed call to prevent a tax hike on a 160 working class Ameircans-- with a partly-combative tone.

âPeople cannot afford losing $40 out of each paycheck this year,â he said. âThere are plenty of ways to get this done. So letâs agree right here, right now: No side issues. No drama. Pass the payroll tax cut without delay. Letâs get it done!â

Obamaâs speech expanded on the vision he sketched out in an address last month in Kansas. He set out to provide Congress with a wish list of sorts to achieve a sound economy, and his hour-long address included four major cornerstones: manufacturing, energy, education and values.

"Think about the America within our reach, a country that leads the world in educating its people. An America that attracts a new generation of high-tech manufacturing and high paying jobs," Obama said. "A future where we're in control of our own energy, and our security and prosperity aren't so tied to unstable parts of the world. An economy built to last, where hard work pays off, and responsibility is rewarded."

Obama provided new details in the speech on how to invest in jobs domestically though âinsourcing.â

He proposed eliminating tax deductions for companies that move U.S. jobs overseas and called for an âinternational minimum taxâ to be imposed on a companyâs overseas profits. He also proposed a tax credit for companies that move jobs back to the U.S.

The president also unveiled a new mortgage crisis unit that will be directed by New York Attorney General Eric Schneiderman. The new office would be created within the Unit on Mortgage Origination and Securitization that investigates misconduct and illegal activity in the housing market. He also announced that he would be creating a Trade Enforcement Unit that will investigate âunfairâ trade practices in countries like China.

In a nod to the Hispanic voters who will be a key factor in the fall campaign, Obama called for building a 21st century immigration system intended to give âresponsible young peopleâ a chance to earn their citizenship.

âWe should be working on comprehensive immigration reform right now,â Obama said. âBut if election-year politics keeps Congress from acting on a comprehensive plan, letâs at least agree to stop expelling responsible young people who want to staff our labs, start new businesses and defend this country.â

While the focus of the address is on the economy, Obama also touted his foreign policy accomplishments. Keeping up with his campaign pledge, Obama said he brought the troops home from Iraq. He also said he delivered justice to 9/11 mastermind Osama bin Laden and that the nation has made important progress in Afghanistan and joined with allies and partners to protect the Libyan regime of Moammar Gadhafi.

The presidentâ"who has chided Congress in recent months for refusing to actâ"most recently in the payroll tax debate, has demonstrated that he will go it alone, using a string of "We Can't Wait" initiatives to move ahead with his proposals. Earlier this month, he angered GOP lawmakers by recess-appointing three people to the National Labor Relations Board and Richard Cordray, who was invited to the State of the Union, to head the Consumer Financial Protection Bureau.

In his address on Tuesday, Obama vowed to work with "anyone in this chamber" to build on momentum to achieve a sound economy. But at the same time, he added, "I intend to fight obstruction with action, and I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place.

âWith or without this Congress, I will keep taking actions that help the economy grow,â Obama warned.

He did just that when he informed the chamber that he would be signing an executive order that would clear away that red tape that stalls construction projects.

And he did it again when he said he was directing his administration âto allow the development of clean energy on enough public land to power three million homes.â Obama said the Department of Defenseâ"the worldâs largest consumer of energyâ"would make a commitment to clean energy by having the Navy purchase enough capacity to power more than 200,000 homes a year.

âThe differences in this chamber may be too deep right now to pass a comprehensive plan to fight climate change,â Obama said. âBut thereâs no reason why Congress shouldnât at least set a clean energy standard that creates a market for innovation. So far you havenât acted. Well tonight, I will.â

While some are dubbing the address as the first major stump speech of the year, the White House has refuted the suggestion, calling it a policy heavy speech that largely steers clear of politics.

On Wednesday, Obama will attempt to sell the points of his address in a three-day road trip to five battleground states in Iowa, Arizona, Nevada, Colorado and Michigan.

This story was posted at 9:15 p.m. and updated at 10:47 p.m.

Gingrich, to Huge Crowd, Mocks 'Planet Obama'

2012-01-25T01:00:00.001-08:00

Jan 24, 2012 4:36pm

Joe Raedle/Getty Images

ABC Newsâ Michael Falcone and Arlette Saenz report:

SARASOTA, Fla. â" It was easy to see the symbols of Newt Gingrichâs momentum in the Republican presidential race: they filled three-quarters of a 27,000 square foot airplane hanger here on balmy Tuesday afternoon.

âYou have to imagine looking out over this crowd and what it just does to make you feel good about Florida,â Gingrich told an estimated 2,500 people. âThis crowd says a lot about this election.â

With a large American flag at his back, his campaign bus to his right, and President Obamaâs State of the Union address just hours away, Gingrich said he would be happy to âsuggest a few things that would improve the state of the union.â

âYou always have to wonder after Obama speaks, which country he thinks heâs talking about,â Gingrich said, âyou always have to wonder what his source material is.â

The former House Speaker who is giving rival Mitt Romney a stiff challenge in the Republican nominating contest spoke to a crowd of Floridians that far surpassed his next-largest event in Salem, N.H. earlier this month. And those who gathered at a private jet airport in Sarasota waited nearly 40 extra minutes to hear Gingrich who was running behind schedule on Tuesday. Many waved hand-held flags and chanted, âNewt! Newt! Newt!â

What they got was the candidateâs own preview of the State of the Union address, which Gingrich said would show the president was living on âPlanet Obama.â

âHe doesnât seem to operate on the same planet you and I do,â Gingrich joked.

âTonight the president will explain that was all George W. Bushâs fault,â Gingrich said predicting Obamaâs explanation for the countryâs economic slump. âThis is the fourth year of his presidency. He needs to get over it.â

Gingrich spent the day making his way down the western coast of Florida â" an important region in his quest to overtake Romney. A win here would give him the unmistakable upper hand heading into the rest of the primary season. But apart from a few passing references to the former Massachusetts governor, Gingrich focused on the president.

âI am for creating jobs, he is for getting people dependent on government. I am for the Declaration of Independence, he is for Saul Alinsky. I am for strength in foreign policy, he is for weakness in foreign policy,â Gingrich said of Obama. âI think itâs that big a gap.â

Obama to Address 'Do-Nothing' Congress

2012-01-25T00:30:00.001-08:00

President Obama has spent the past three months railing against a "do-nothing Congress," and tonight he has the opportunity to deliver his message face to face.

Obama will use his third State of the Union Address to promote what aides describe as a populist economic agenda he's already spent weeks pitching directly to voters, insisting the ideas deserve bipartisan support. Now, in the face of what he's framed as Republican obstruction, Obama will draw an election-year line in the sand.

This is a "make-or-break moment for the middle class and folks trying to work their way into the middle class," Obama said, previewing the address in a video posted on his re-election campaign website and emailed to supporters.

"Because we can go in two directions: One is towards less opportunity and less fairness, or we can fight for where I think we need to go: building an economy that works for everyone, not just a wealthy few."

Obama intends to make tax fairness a central theme to illustrate his point, renewing a push for what he calls the Buffett Rule, a principle for tax reform that would ensure billionaires and millionaires do not pay a lower effective tax rate than members of the middle class.

The White House also plans to put a face on the issue, hosting Debbie Bosanek, aka Warren Buffet's secretary, who famously pays a higher tax rate (as a percentage of her income) than her billionaire boss, in the presidential box for the address.

Shahar Azran/WireImage

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The class contrast and tax fairness issues, two of Obama's major re-election campaign themes, will get what is arguably it tjeor biggest audience yet with the nationally televised address in prime time. An estimated 43 million viewers watched Obama's State of the Union last year.

But as Obama lays out what he calls a "blueprint" for the county, viewers may find that many of the ideas aren't all that new.

Proposals Obama put forward in 2011, from eliminating subsidies for oil companies, to overhauling No Child Left Behind and the nation's immigration system, remain unresolved. Many of the infrastructure investments the president heralded have not gotten off the ground, while sweeping tax reform to "simplify the system and get rid of the loopholes" is still elusive.

"I think that any State of the Union address which lays out an agenda has to be ambitious. And if you got through a year and you achieved everything on your list, then you probably didn't aim high enough. So I think this president aims high," White House press secretary Jay Carney said Monday.

"There are absolutely things that remain undone that need to be done, that he will call on all of us to work together to get done in this address and beyond," he added. "But there is also a fairly comprehensive list of proposals that have been achieved, that I'm sure we'll be discussing as the year goes on."

Among those accomplishments are newly signed trade deals with South Korea, Panama and Colombia that had been in works since the Bush administration, a recently-launched effort to streamline and reorganize the federal agencies, and a new website for how tax dollars are spent -- all mentioned in the address one year ago.

Perhaps the biggest areas of achievement Obama will tout are in foreign and military policy: a successful raid that killed Osama bin Laden, a targeted international military operation in Libya that helped in the overthrow of Moammar Gadhafi, and an end to the war in Iraq.

White House aides say the overarching framework of the address, with the sweeping rhetoric and broad policy priorities of State of the Unions past, will "bookend" Obama's "fair shot" speech in Osawatomie, Kan., one month ago.

He will underline a vision of revitalizing American manufacturing, boosting energy production, invigorating skills training programs for American workers and a return to "American values," they say.

But will Republicans buy it?

Claims of optimism for a bipartisan embrace notwithstanding, the short answer is no.

News Analysis: Obama Sets Sights on Romney in State of the Union

2012-01-25T00:00:00.001-08:00

WASHINGTON â" President Obama did not mention Mitt Romney on Tuesday evening, but he didnât need to. Mr. Romney, whom the presidentâs aides still view as his most likely opponent in the fall, was the unspoken adversary in Mr. Obamaâs call for a more equitable society â" the natural foil for his proposals to level the playing field for middle-class Americans, from taxes to trade policy.

When Mr. Obama talked about levying a millionairesâ tax, he might have been referring to Mr. Romneyâs newly released tax return, which disclosed he paid a tax rate of 13.9 percent on income of more than $20 million in 2010.

When he referred to his administrationâs bailout of the auto industry, noting that âsome even said we should let it die,â he could have been talking about Mr. Romneyâs argument that the carmakers should have been allowed to fail. And when he said he would oppose âany effort to return to the very same policies that brought on this economic crisis in the first place,â he could have been referring to Mr. Romneyâs call for a rollback of regulations on Wall Street.

Nine months before he faces the voters, Mr. Obama seized what is likely to be one of his most prominent platforms of the year to draw a bright line between himself and Mr. Romney â" and, in the process, try to appeal to those frustrated by the deepening economic divide.

Gone was the soaring language of his last State of the Union address, when the president spoke of winning the future â" a challenge he likened to âour generationâs Sputnik moment.â With the tents of the Occupy protesters catching snow in American cities, he was tapping into a national sense of grievance.

âWhen Americans talk about folks like me paying my fair share of taxes, itâs not because they envy the rich,â Mr. Obama said, answering Mr. Romneyâs charge that the president engages in the âbitter politics of envy.â âItâs because they understand that when I get tax breaks I donât need and the country canât afford, it either adds to the deficit or somebody else has to make up the difference.â

It is a theme he has struck repeatedly as his campaign has geared up, and nowhere more forcefully than last month in Osawatomie, Kan., where he invoked the spirit of Theodore Roosevelt, a Republican aristocrat who nevertheless broke up monopolies and campaigned for a progressive income tax.

Mr. Obamaâs appeal on Tuesday, studded as it was with the policy proposals that fill these addresses, did not match that populist fury. But in the august setting of the Capitol, squaring off against an often-hostile Congress, the president rolled out an election-year message that offers voters a stark choice between his vision and what he paints as the Darwinian approach of Mr. Romney and other Republicans.

To some extent, Mr. Obama was also aiming his words at Florida, where Mr. Romney and the rest of the Republican field are competing in a primary next week over the right to challenge the president.

Every word in a State of the Union address is carefully chosen. So it was no accident that when the president discussed the auto industry and the future of American manufacturing, he said: âWhatâs happening in Detroit can happen in other industries. It can happen in Cleveland and Pittsburgh and Raleigh.â

Those cities happen to be in Michigan, Ohio, Pennsylvania and North Carolina â" battleground states totaling 69 electoral votes.

But much of the presidentâs message was clearly intended to push back at his Republican rivals and their critiques of his record.

Lest anyone forget Mr. Romneyâs background at Bain Capital as an avid buyer and seller of companies, Mr. Obama offered a paean to permanence â" to companies built on a sturdy foundation of manufacturing and skilled workers. These businesses, he said, are the basis of a competitive economy.

Mr. Obama also seemed to have Mr. Romney in mind when he announced new housing assistance and declared that âresponsible homeowners shouldnât have to sit and wait for the housing market to hit bottom to get some relief.â Last year, Mr. Romney went to Nevada, the state hardest hit by foreclosures, and told a Las Vegas newspaper that the housing market needed to bottom out.

Mr. Obama also said he would oppose efforts to repeal financial regulations, and he drew a direct link between the policies of his predecessor, George W. Bush, and the economic mess that has consumed his own presidency.

In recent weeks, Mr. Obama has had a useful surrogate in Newt Gingrich, the former House speaker, who has accused Mr. Romney of destroying jobs while at Bain and pressured him to release his tax returns.

But Mr. Gingrich, whose victory in the South Carolina primary has turned him into a real competitor, did not escape a few jabs Tuesday night. Mr. Obama called for new rules to reduce the influence of lobbyists. Left unsaid was Mr. Gingrichâs disclosure on Monday that he had been paid $1.6 million to advise the mortgage giant Freddie Mac.

Mr. Romney was not silent on Mr. Obamaâs big day, earlier laying out his own case for leadership in a speech at a shuttered factory in Tampa, Fla. He argued that his 25 years in business had given him the skills to turn around the economy. The president, Mr. Romney said, âputs his faith in government; we put our faith in the American people.â

âOurs is the party of free enterprise, free markets and consumer choice,â he said. âThe Republican Party stands for personal responsibility and equal opportunity. We donât demonize prosperity; we celebrate success.â

Mr. Obama countered that he had turned things around, pointing to the revived auto industry, a recovering economy and three million private-sector jobs. And he flatly rejected the contention of Mr. Romney, Mr. Gingrich and other Republicans that he is presiding over a country in decline.

âAnyone who tells you otherwise,â the president said, âanyone who tells you that America is in decline or that our influence has waned, doesnât know what theyâre talking about.â

Jonathan Weisman contributed reporting.

Daniels' GOP response to State of the Union speech

2012-01-24T23:30:00.001-08:00

Gov. Mitch Daniels delivers the Republican response, saying that the loyal opposition puts "patriotism and national success ahead of party or ideology" and says the GOP "program of renewal" will rebuild the American dream.

INDIANAPOLIS -- Here's the full text, as prepared for delivery,Â of Indiana Gov. Mitch Daniels' Republican response to the president's State of the Union address to the nation:

"The status of 'loyal opposition' imposes on those out of power some serious responsibilities: to show respect for the Presidency and its occupant, to express agreement where it exists. Republicans tonight salute our President, for instance, for his aggressive pursuit of the murderers of 9/11, and for bravely backing long overdue changes in public education. I personally would add to that list admiration for the strong family commitment that he and the First Lady have displayed to a nation sorely needing such examples.

"On these evenings, Presidents naturally seek to find the sunny side of our national condition. But when President Obama claims that the state of our union is anything but grave, he must know in his heart that this is not true.

"The President did not cause the economic and fiscal crises that continue in America tonight. But he was elected on a promise to fix them, and he cannot claim that the last three years have made things anything but worse: the percentage of Americans with a job is at the lowest in decades. One in five men of prime working age, and nearly half of all persons under 30, did not go to work today.

"In three short years, an unprecedented explosion of spending, with borrowed money, has added trillions to an already unaffordable national debt. And yet, the President has put us on a course to make it radically worse in the years ahead. The federal government now spends one of every four dollars in the entire economy; it borrows one of every three dollars it spends. No nation, no entity, large or small, public or private, can thrive, or survive intact, with debts as huge as ours.

"The President's grand experiment in trickle-down government has held back rather than sped economic recovery. He seems to sincerely believe we can build a middle class out of government jobs paid for with borrowed dollars. In fact, it works the other way: a government as big and bossy as this one is maintained on the backs of the middle class, and those who hope to join it.

"Those punished most by the wrong turns of the last three years are those unemployed or underemployed tonight, and those so discouraged that they have abandoned the search for work altogether. And no one has been more tragically harmed than the young people of this country, the first generation in memory to face a future less promising than their parents did.

"As Republicans our first concern is for those waiting tonight to begin or resume the climb up life's ladder. We do not accept that ours will ever be a nation of haves and have nots; we must always be a nation of haves and soon to haves.

"In our economic stagnation and indebtedness, we are only a short distance behind Greece, Spain, and other European countries now facing economic catastrophe. But ours is a fortunate land. Because the world uses our dollar for trade, we have a short grace period to deal with our dangers. But time is running out, if we are to avoid the fate of Europe, and those once-great nations of history that fell from the position of world leadership.

"So 2012 is a year of true opportunity, maybe our last, to restore an America of hope and upward mobility, and greater equality. The challenges aren't matters of ideology, or party preference; the problems are simply mathematical, and the answers are purely practical.

"An opposition that would earn its way back to leadership must offer not just criticism of failures that anyone can see, but a positive and credible plan to make life better, particularly for those aspiring to make a better life for themselves. Republicans accept this duty, gratefully.

"The routes back to an America of promise, and to a solvent America that can pay its bills and protect its vulnerable, start in the same place. The only way up for those suffering tonight, and the only way out of the dead end of debt into which we have driven, is a private economy that begins to grow and create jobs, real jobs, at a much faster rate than today.

"Contrary to the President's constant disparagement of people in business, it's one of the noblest of human pursuits. The late Steve Jobs - what a fitting name he had - created more of them than all those stimulus dollars the President borrowed and blew. Out here in Indiana, when a businessperson asks me what he can do for our state, I say 'First, make money. Be successful. If you make a profit, you'll have something left to hire someone else, and some to donate to the good causes we love.'

"The extremism that stifles the development of homegrown energy, or cancels a perfectly safe pipeline that would employ tens of thousands, or jacks up consumer utility bills for no improvement in either human health or world temperature, is a pro-poverty policy. It must be replaced by a passionate pro-growth approach that breaks all ties and calls all close ones in favor of private sector jobs that restore opportunity for all and generate the public revenues to pay our bills.

Praising the Midwestern conservatism and mentions of "protecting the safety net," Chris Matthews says he understands why the GOP establishment is said to be rooting for Gov. Daniels.

"That means a dramatically simpler tax system of fewer loopholes and lower rates. A pause in the mindless piling on of expensive new regulations that devour dollars that otherwise could be used to hire somebody. It means maximizing on the new domestic energy technologies that are the best break our economy has gotten in years.

"There is a second item on our national must-do list: we must unite to save the safety net. Medicare and Social Security have served us well, and that must continue. But after half and three quarters of a century respectively, it's not surprising that they need some repairs. We can preserve them unchanged and untouched for those now in or near retirement, but we must fashion a new, affordable safety net so future Americans are protected, too.

"Decades ago, for instance, we could afford to send millionaires pension checks and pay medical bills for even the wealthiest among us. Now, we can't, so the dollars we have should be devoted to those who need them most.

"The mortal enemies of Social Security and Medicare are those who, in contempt of the plain arithmetic, continue to mislead Americans that we should change nothing. Listening to them much longer will mean that these proud programs implode, and take the American economy with them. It will mean that coming generations are denied the jobs they need in their youth and the protection they deserve in their later years.

"It's not fair and it's not true for the President to attack Republicans in Congress as obstacles on these questions. They and they alone have passed bills to reduce borrowing, reform entitlements, and encourage new job creation, only to be shot down time and time again by the President and his Democratic Senate allies.

"This year, it falls to Republicans to level with our fellow citizens about this reality: if we fail to act to grow the private sector and save the safety net, nothing else will matter much. But to make such action happen, we also must work, in ways we Republicans have not always practiced, to bring Americans together.

"No feature of the Obama Presidency has been sadder than its constant efforts to divide us, to curry favor with some Americans by castigating others. As in previous moments of national danger, we Americans are all in the same boat. If we drift, quarreling and paralyzed, over a Niagara of debt, we will all suffer, regardless of income, race, gender, or other category. If we fail to shift to a pro-jobs, pro-growth economic policy, there will never be enough public revenue to pay for our safety net, national security, or whatever size government we decide to have.

"As a loyal opposition, who put patriotism and national success ahead of party or ideology or any self-interest, we say that anyone who will join us in the cause of growth and solvency is our ally, and our friend. We will speak the language of unity. Let us rebuild our finances, and the safety net, and reopen the door to the stairway upward; any other disagreements we may have can wait.

"You know, the most troubling contention in our national life these days isn't about economics, or policy at all. It's about us, as a free people. In two alarming ways, that contention is that we Americans just can't cut it anymore.

"In word and deed, the President and his allies tell us that we just cannot handle ourselves in this complex, perilous world without their benevolent protection. Left to ourselves, we might pick the wrong health insurance, the wrong mortgage, the wrong school for our kids; why, unless they stop us, we might pick the wrong light bulb!

"A second view, which I admit some Republicans also seem to hold, is that we Americans are no longer up to the job of self-government. We can't do the simple math that proves the unaffordability of today's safety net programs, or all the government we now have. We will fall for the con job that says we can just plow ahead and someone else will pick up the tab. We will allow ourselves to be pitted one against the other, blaming our neighbor for troubles worldwide trends or our own government has caused.

"2012 must be the year we prove the doubters wrong. The year we strike out boldly not merely to avert national bankruptcy but to say to a new generation that America is still the world's premier land of opportunity. Republicans will speak for those who believe in the dignity and capacity of the individual citizen; who believe that government is meant to serve the people rather than supervise them; who trust Americans enough to tell them the plain truth about the fix we are in, and to lay before them a specific, credible program of change big enough to meet the emergency we are facing.

"We will advance our positive suggestions with confidence, because we know that Americans are still a people born to liberty. There is nothing wrong with the state of our Union that the American people, addressed as free-born, mature citizens, cannot set right. Republicans in 2012 welcome all our countrymen to a program of renewal that rebuilds the dream for all, and makes our 'city on a hill' shine once again."

TRANSCRIPT: GOP Rebuttal to State of the Union

2012-01-24T23:00:00.001-08:00

The following is the full text of Gov. Mitch Daniels' Republican Address to the Nation, as prepared for delivery:

State of the Union: Fact Checking the President

2012-01-24T22:30:00.001-08:00

ABC Newsâ Huma Khan, Elizabeth Hartfield, Matt Negrin, Chris Good, Amy Bingham, Jeunee Simon, Greg Krieg, Meg Fowler and Sarah Parnass report:

Fact Check 1 â" The Booming Economy
Fact Check 2 â" Obamaâs Plan for Foreclosures
Fact Check 3 â" The American Auto Industry is Back
Fact Check 4 â" Obamaâs Plug for Students
Fact Check 5 â" The Rich, Their Secretaries and Taxes
Fact Check 6 â" Soaring Energy Production and Advances in Offshore Drilling
Fact Check 7 â" Overseas Tax Breaks
Fact Check 8 â" Can Obama Tax the Rich to Save the Debt?
Fact Check 9 â" Who Took on China More?
Fact Check 10 â" Milk Versus Oil
Fact Check 11 â" Obama Repeats a Demand to Tone It Down
Fact Check 12 â" Stimulating the Stimulus and Using the War Funds to Pay Down the Debt

Fact or Fiction Number 1 â" The Booming Economy: Obamaâs Jobs Story

Did the economy crater before President Obamaâs inauguration, then rebound once his policies took effect?

It seems unlikely that the president would utter inaccurate jobs numbers during his State of the Union address, but while we wait for official White House citation, the president made at least one claim that for now looks iffy. The transcript:

âIn the six months before I took office, we lost nearly four million jobs. And we lost another four million before our policies were in full effect. Those are the facts. But so are these. In the last 22 months, businesses have created more than three million jobs. Last year, they created the most jobs since 2005.â

4 million jobs lost in 6 months before Obama took office: Looks like this total falls short of 4 million. Subtracting the total employment listed in the January 2009 Bureau of Labor Statistics employment report from the same total in August 2008, one arrives at 3.378 million jobs lost.**
Another 4 million jobs lost before Obamaâs policies took full effect. Using this Bureau of Labor Statistics table, starting at February 2009, the sum of monthly job losses surpass 4 million in October 2009. President Obamaâs stimulus was passed in February 2009â"though it took notoriously long for that money to make its way out the door.
3 million jobs created over 22 months, more jobs created in 2011 than in any year since 2005. Using total employment, Obamaâs numbers donât hold up. According to the same BLS table, the economy added 2.056 million jobs over 21 months (counting backward, the next month saw job losses). And 2011 saw more job growth than any year since 2006, not 2005. But Politifact notes that Obamaâs statement was accurateâ"he was talking about private-sector jobs.

**UPDATE: President Obama was referring exclusively to private-sector jobs when talking about jobs lost before his time in office, according to a White House official. Based on this private-sector jobs chart, the economy lost 3.506 jobs in the six months before his inauguration, not 4 million.

Fact or Fiction Number 2 â" Obamaâs Plan for Foreclosures

âThatâs why Iâm sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage, by refinancing at historically low interest rates. No more red tape. No more runaround from the banks. A small fee on the largest financial institutions will ensure that it wonât add to the deficit, and will give banks that were rescued by taxpayers a chance to repay a deficit of trust.â

The Obama administration has announced a number of programs to salvage the housing market, which continues to be a drag on the U.S. economy. Today, the president was referring to a plan he announced in October from the front porch of a home in Las Vegas, which has one of the highest foreclosure rates in the country. The presidentâs plan would allow struggling homeowners who have mortgages backed by Fannie Mae or Freddie Mac to refinance without getting a new appraisal or a full credit check. The program would also eliminate some risk-based fees for borrowers.

The proposal would alter the $75 billion Home Affordable Refinance Program, or HARP, which was launched in 2009 to help distressed homeowners.

If a homeowner has a mortgage of $250,000 at a 6 percent interest rate, they would be able to take advantage of record low interest rates and refinance their home. If they got a rate thatâs 4.5 percent or lower, the homeowner would save $250 a month, or $3,000 a year. Given that there are 4 million homeowners who are backed by government-sponsored entities, the administration says the program can help millions of Americans.

But the initial HARP program fell short of its initial goals, with only about 900,000 homeowners taking advantage of it, far less than what the administration had hoped. Additionally, many homeowners who took advantage of the program ended up defaulting again on their mortgage.

The president tonight touted this new proposal as having no red tape or runaround from banks, but there are a number of caveats in his program. Only those who signed a mortgage before May 31, 2009, and have not refinanced previously under the Home Affordable Refinance Program are eligible for the new scheme. The loan-to-value ratio has to be greater than 80 percent. Borrowers must also have good credit and must have kept up with their mortgage payments, with no late payment in the past six months and no more than one late payment in the past 12 months.

Some economists calculate that it would only benefit 1 million households, a relatively small number given that more than 6 million homeowners are facing foreclosure or have delinquent payments. Others say the restrictions are too stringent and automatically cut out those under-water homeowners who have bad credit.

Fact or Fiction Number 3 â" The American Auto Industry is Back

The manufacturing sector is a key part of Obamaâs âBlueprint for An America Built to Last,â which he outlined in his state of the union address, and a key part of that sector is the American automobile industry. âOn the day I took office, our auto industry was on the verge of collapse â¦ and tonight, the American auto industry is back,â Obama said in his address.

When Obama took office in 2008 the American auto industry was indeed in crisis. General Motors, Chrysler, and Ford were all facing financial turmoil, and seeking government bailouts in order to stay afloat. In 2009, Obama hired Steve Rattner to serve as his car czar, and oversee the federal bailout of these three American institutions.

Today, General Motors, Chrysler, and Ford have turned around. General Motors recently reclaimed its place as the top-selling automaker in the world, ousting the previous top-seller, Toyota. Chrysler is currently Americaâs fastest growing car company, and Ford recently announced plans to invest $446 million in manufacturing in Brazil.

As part of this claim, Obama gave a subtle jab to his one of the GOP presidential candidates, Mitt Romney. On the topic of the auto industry, Obama said âsome even said we should let it die.â That comment was likely a reference to the former Massachusetts governorâs 2008 Op-Ed piece in the New York Times titled âLet Detroit Go Bankrupt,â in which Romney argued against a bailout for the industry.

Fact or Fiction Number 4 â" Debt Serious: Obamaâs Plug for Students

In his State of the Union speech tonight, President Obama said Congress should slow interest rates on student loans because âAmericans owe more in tuition debt than credit card debt.â

As of late 2010, thatâs true. In September, a student aid study reported that Americans owed $830 billion in student loan debt, and $825 billion in credit card debt.

The National Center for Education Statistics says: â38 percent [of all undergraduates in 2007-08] took out an average of $7,100 in student loans â¦ and 4 percent of students had parents who took out an average of $10,800 in Parent PLUS loans. â¦ 34 percent of all undergraduates took out federal Stafford loans averaging a total of $5,000. Subsidized Stafford loans were received by 30 percent of undergraduates and averaged $3,400, while 22 percent received an average of $3,200 in unsubsidized Stafford loans.â

Fact or Fiction Number 5 â" The Rich, Their Secretaries and Taxes

Treasury Secretary Geithner yesterday declined to answer a key question about the presidentâs proposed âBuffett Ruleâ: How many millionaires and billionaires pay lower tax rates than middle-income families?

The answer: not that many.

Read more from ABC Newsâ Jon Karl here.

Fact or Fiction Number 6 â" Soaring Energy Production and Advances in Offshore Drilling

Nowhere is the promise of innovation greater than in American-made energy. Over the last three years, weâve opened millions of new acres for oil and gas exploration, and tonight, Iâm directing my Administration to open more than 75 percent of our potential offshore oil and gas resources. Right now, American oil production is the highest that itâs been in eight years. Thatâs right â" eight years. Not only that â" last year, we relied less on foreign oil than in any of the past sixteen years.

The president tonight touted the rise in domestic energy production and a decrease in U.S. oil imports during his term. While his claims on oil production are true, they donât quite live up to the facts when it comes to imports.

In 2010 â" the most recent full year for which the U.S. Energy Information Administration has published data â" crude oil production was the highest since 2003. Total energy production, which includes fossil fuels and renewable energy, was the highest it has been since the EIA started recording the data in 1949. Read more from the EIA here.

In the first seven months of 2011, total production was more than 5 percent higher than during the same time period in 2009, and the total numbers for the full year 2011 looked to surpass 2010. Read more from the EIA here.

Meanwhile, offshore oil production has grown under Obama despite the moratorium on deepwater drilling that he imposed in 2010, following the BP oil spill in the Gulf of Mexico. Oil production in the Gulf of Mexico was at record levels that year. In 2009, total oil production from the U.S. Outer Continental Shelf was the highest since 2003, according to data from the Bureau of Ocean Energy Management, Regulation and Enforcement.

Imports have dropped over the years, especially from oil-rich Middle Eastern countries. But the presidentâs assertion that foreign oil imports are the lowest in the past 16 years may not completely be true. The United States imported more petroleum in 2010 than it did in 2009, according to the EIA. And total imports in 2010 â" including that of oil and coal â" were lowest in 13 years.

Fact or Fiction Number 7 â" Overseas Tax Breaks

Obama called tonight for America to âstop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America.â

âRight now, companies get tax breaks for moving jobs and profits overseas,â Obama said at in his third State of the Union address Tuesday night.Â âMeanwhile, companies that choose to stay in America get hit with one of the highest tax rates in the world.Â It makes no sense, and everyone knows it.â

The president was correct in saying that business can lower their tax rates by fleeing U.S. soil. Of the 34 developed countries that make up the Organization for Economic Cooperation and Development, America has the second-highest corporate tax rate.

U.S.-based companies are taxed at 35 percent by the federal government. Add state taxes to that and the average corporate tax rate is 39.2 percent. Only Japanâs is higher at 39.5 percent, according to OECD data from 2011.

But when tax deductions and loopholes are factored into the equation, the U.S. corporate rate falls to roughly 27 percent, according to the Tax Foundation.

And according toÂ a study by the Citizens for Tax Justice and the Institute on Taxation and Economic Policy, 280 of the corporations on the Fortune 500 list paid an average rate of 18.5 percent.

Obama also called for a âbasic minimum taxâ on every multinational corporation to prevent companies from outsourcing to overseas tax havens.

Obamaâs approach on this issue is virtually the opposite of his GOP presidential rivals. Nearly every Republican presidential candidate has called for U.S. companies that earn profits overseas to be able to bring those profits back to America tax-free.

As the tax code stands now, those companies have to pay the U.S. government the difference between the lower, foreign tax rates and the often higher U.S. tax rate.

The president said he wants to increase tax cuts for American manufacturers and double the deduction for high-tech manufacturers.

Manufacturers already receive multiple tax credits and deductions that the lower their collective taxes by about $58 billion annually,Â the Fiscal Times reports.

As of 2010, tax credits for investing in new facilities focused primarily on energy efficiency. For example, $240 million of deductions were given to corporations that invested in clean coal facilities in 2011. About $39 billion worth of deductions went to support investments in machinery and equipment.

Fact or Fiction Number 8 â" The Tax Man Is Hereth: Can Obama Tax the Rich to Save the Debt?

President Obama suggested in his speech tonight that taxing the rich will âreduce our deficit.â Unfortunately, tax experts disagree.

Obama need look no further than the two men he chose to lead his deficit commission, Alan Simpson and Erskine Bowles. TheyÂ wrote in The Washington Post: âThe president must be willing to support real savings in entitlements that deal with long-term costs. We canât simply cut or tax our way out of this problem. Bringing our debt under control will require tackling the growth of entitlements and reforming the tax code to promote economic growth and generate enough revenue to meet our commitments.â

Hereâs what Obama said in his speech:

âWe need to change our tax code so that people like me, and an awful lot of members of Congress, pay our fair share of taxes.Â â¦ If you make more than $1 million a year, you should not pay less than 30 percent in taxes.Â â¦ Asking a billionaire to pay at least as much as his secretary in taxes?Â Most Americans would call that common sense.Â â¦ When I get a tax break I donât need and the country canât afford, it either adds to the deficit, or somebody else has to make up the difference â" like a senior on a fixed income; or a student trying to get through school; or a family trying to make ends meet.Â Thatâs not right.Â Americans know itâs not right.Â They know that this generationâs success is only possible because past generations felt a responsibility to each other, and to the future of their country, and they know our way of life will only endure if we feel that same sense of shared responsibility.Â Thatâs how weâll reduce our deficit.Â Thatâs an America built to last.â

Fact or Fiction Number 9 â" Manchurian Trade Rate: Who Took on China More?

President Obama said tonight that heâs âbrought trade cases against China at nearly twice the rate as the last administration.â

President Bush filed seven complaints with the World Trade Organization against China, over eight years. Obama has filed five in three years.

Obamaâs team must have done some math: If Obama keeps that rate the same, heâll have filed about 13 by the time his (presumptive) second term ends. Thatâs just one short of 14, which would be, as Obama said, twice as much as Bushâs seven.

The White House didnât support the anti-piracy bill known as SOPA, though the administration did voice support for a kind of legislation that addressed piracy. âAny provision covering Internet intermediaries such as online advertising networks, payment processors, or search engines must be transparent and designed to prevent overly broad private rights of action that could encourage unjustified litigation that could discourage startup businesses and innovative firms from growing,â a White House statement said.

Fact or Fiction Number 10 â" A Milk Spill Was Equal To An Oil Spill In The Eyes of Federal Rules

As an example of his record on getting rid of unnecessary federal regulations, President Obama cited the elimination of a rule that classified a milk spill as a type of oil spill.

While the comparison seems odd, it is indeed based in an old federal law. An obscure quirk in an EPA rule called the Oil Spill Prevention, Control and Countermeasures (SPCC) rule classified milk as a type of oil. The logic behind the rule, which went into effect in the 1970s, was that milk fat is a type of animal fat, and is therefore technically a type of oil. The rule was finally altered in August 2011, resulting in the exemption of milk and milk product containers.

The larger claim Obama sought to make through the utilization of this milk example is that he has generally been against increasing regulations. He asserted that he has approved fewer regulations in the first three years of his presidency than George W. Bush did in his first three years. This claim is true. In the first 33 months of his presidency Obama approved 613 federal rules, while President George W. Bush had approved 643 in the same time frame, according to an analysis byÂ Bloomberg News.

However that same analysis notes that while the number of regulations approved by Obama alone is smaller, he has approved a larger number of federal rules that carry a price tag of more than $100 million than his Republican predecessor had at the same point in his presidency. Obama has approved 129 of these rules, while Bush had approved 90.

Fact or Fiction Number 11 â" Itâs Getting Hot in Here: Obama Repeats a Demand to Tone It Down

Remember last January, when President Obama flew to Arizona after Rep. Gabrielle Giffords was shot and called on the countryâs political class to take it down a notch?

âBut at a time when our discourse has become so sharply polarized â" at a time when we are far too eager to lay the blame for all that ails the world at the feet of those who think differently than we do â" itâs important for us to pause for a moment and make sure that we are talking with each other in a way that heals, not a way that wounds,â Obama said a year ago. âWhat we canât do is use this tragedy as one more occasion to turn on one another.Â As we discuss these issues, let each of us do so with a good dose of humility. Rather than pointing fingers or assigning blame, let us use this occasion to expand our moral imaginations, to listen to each other more carefully, to sharpen our instincts for empathy, and remind ourselves of all the ways our hopes and dreams are bound together.â

Twelve months later, Obamaâs message is about the same. To be sure, itâs been a heated year â" with the debt ceiling debate, the Republican primary and more.

Obama said near the end of his State of the Union speech tonight: âNone of these reforms can happen unless we also lower the temperature in this town.Â We need to end the notion that the two parties must be locked in a perpetual campaign of mutual destruction, that politics is about clinging to rigid ideologies instead of building consensus around common sense ideas.â

Fact or Fiction Number 12 â" Can President Obama Stimulate the Stimulus and Use the War Funds to Pay Down the Debt and Build New Roads?

President Obama has promised quite a lot tonight, but never so much as in the fevered paragraph below.

Weâll take it line by line:

In the next few weeks, I will sign an Executive Order clearing away the red tape that slows down too many construction projects.

The president wasnât the first to say it, but he did admit as much â" âShovel ready wasnâtÂ quite as, uh,Â shovel readyÂ as we thought,â he told his Council on Jobs and Competitiveness when they met in Durham, N.C., last June. He was referring to the AmericanÂ Recovery and Reinvestment Act, better known as âthe stimulus,â a plan to spend approximately $787 billion on infrastructure renewal, âcreating and savingâ millions of jobs in the process. But the building of the roads and rails has been slow. Bickering over contracts and other issues have plagued the program. It is not clear what, if anything, the president can do to stimulate his stimulus.Â A single executive order hardly seems like itâd be enough.

But you need to fund these projects.

True, but that was what the stimulus Â money had been meant for, right?

Take the money weâre no longer spending at war, use half of it to pay down our debt, and use the rest to do some nation-building right here at home.

Sounds simple, right? Not so fast. When it comes to government, âa penny savedâ is often confused with âa penny not spent.â The dollars that the U.S. will not spend in Iraq and Afghanistan (as the latter conflict winds down) do not get thrown back into some imaginary pot (Republicans might say, âslush fundâ) for paying down the debt or building high-speed railways. In fact, the billions authorized by the Federal government for fighting abroad helped to create that debt. Less spending on the war front will surely help with the bottom line, but it is not a newly realized rainy-day fund.

Obama declares 'we've come too far to turn back now'

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Kevin Lamarque / Reuters

U.S. President Barack Obama attends a campaign fund raiser at the Apollo Theater in New York January 19, 2012.

By Tom Curry, msnbc.com National Affairs Writer

With a still unfinished legislative agenda from last year and with Election Day nine months from now, President Barack Obama will go before a joint session of Congress at 9 p.m. ET to offer his proposals for this session of Congress and to paint sharp contrasts with his Republican foes.

In excerpts from the speech released by the White House, Obama paints a dire scenario of a nation divided into a wealthy elite and a mass of struggling Americans on the verge of insolvency.

âWe can either settle for a country where a shrinking number of people do really well, while a growing number of Americans barely get by,â Obama said in the prepared remarks. âOr 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."

The president vows that âwe will not go back to an economy weakened by outsourcing, bad debt, and phony financial profitsâ and says he wants to âlay out a blueprint for an economy thatâs built to last â" an economy built on American manufacturing, American energy, skills for American workers, and a renewal of American values."

In a nod to bipartisanship, Obama says in the prepared remarks, "I will work with anyone in this chamberâ to build on the momentum of a growing economy.Â

But he adds that âI intend to fight obstruction with action, and I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place."

David Plouffe, a senior adviser to President Obama, talks to TODAY's Ann Curry about the 2012 presidential race and previews President Obama's State of the Union address.

Obama will speak against the backdrop of an improving economy which is slowly recovering from the recession of 2007-2009. Employment has shown signs of revival in recent months, with the jobless rate falling from 10 percent in October of 2009 to 8.5 percent last month.

But there were still almost one million fewer people employed last month than when Obama signed his $825 billion stimulus bill into law in February 2009.

Obama also speaks at a time when his re-election prospects are uncertain, even though his would-be Republican presidential rivals have been spending most of their energy launching rhetorical assaults on each other.

In the most recent Gallup Poll, Obama has a 44 percent approval rating.Â Gallup said that, compared to other elected presidents' third-year averages, âObama's 44 percent is among the lowest, better than only Jimmy Carter's 37 percent average in 1979-1980.â

But Gallup added that Ronald Reagan's third-year average approval rating of 45 percent was similar to Obama's.

Faced with a recession and a recovery as Obama now is, Reagan ended up winning a second term by a landslide over Democrat Walter Mondale.

Obama will speak Tuesday night with his signature first-term achievement â" a historic overhaul of health insurance and an expansion of Medicaid â" under the shadow of a pending decision by the Supreme Court.

Oral arguments before the justices on the constitutionality of the health insurance overhaul will stretch over three days in late March. The high court is considering not only whether the requirement to buy insurance is constitutional, but whether the states can be forced to expand their Medicaid programs, as the law orders them to do.

Meanwhile, Obamaâs ability to get Congress pay for any new proposal he might make is boxed in by controls on spending which he signed into law last year as part of an accord with Congress to raise the limit on federal borrowing.

Any new program would likely come in the category of discretionary outlays, the part of the budget that Congress controls through annual appropriation bills. Discretionary spending amounted to $1.35 trillion in 2011, 40 percent of total outlays, according to the Congressional Budget Office. Slightly more than half of that spending was for defense.

But the Budget Control Act which Obama signed last summer imposes limits on discretionary spending. For 2012 and 2013, the caps would keep spending for items other than the Afghanistan war below the 2011 spending level and would limit the growth of those appropriations to about two percent a year from 2014 to 2021, according to the CBO.

Meanwhile entitlement spending â" the 40 percent of the budget that goes to Medicare for the elderly, Medicaid for the poor, and Social Security for the disabled and retired â" continues to grow steadily, driven by an aging population.

Obama faces a House of Representatives with 242 Republicans â" the most that any Democratic president has had to face since Harry Truman in 1947.

As Truman did in the 1948 presidential campaign, Obama is sure to lambaste the Republican majority as an obstructionist, do-nothing Congress. Republicans are returning fire by saying the House has passed more than two dozen separate job creation bills and the Democratic-controlled Senate hasnât acted on them.

âWe donât blame the president and the Democratic Congress thatâs been running this place for the last three years for what theyâve inherited,â said Tennessee Republican Sen. Lamar Alexander. âBut we do hold them responsible for what they have done during the last three years. Theyâve been in charge, theyâve made it worse, and we know how to make it better. Weâve advanced a number of proposals to close tax loopholes, reduce the debt, lower tax rates, lower health care costs, find more American energy and use less.â

Obama is expected to expand Tuesday night on the âfairnessâ theme he discussed in his Kansas speech last month.Â In that speech Obama said, ârebuilding this economy based on fair play, a fair shot, and a fair share will require all of us to see that we have a stake in each otherâs success.â

He made the case for raising taxes on higher-income people who have income from capital gains and dividends.

Obama advisor David Plouffe was asked on the Today show Tuesday about GOP presidential contender Mitt Romneyâs 2010 tax return which showed him paying $3 million in income taxes on $21.6 million in income.

Plouffe said, âItâs a good example â¦ Â of the tax reform we need. Warren Buffett said he should not be paying less taxes â" as a rate â" than his secretary. The president is going actually tonight to lay out some specifics on the Buffett rule â" what it means how itâs going to work.â

About 80 percent of Romneyâs income came from dividends and capital gains which are taxed at 15 percent, instead of at the top rate for wage and salary income, 35 percent. With only a brief interval, capital gains have enjoyed preferential tax treatment since the 1920s.

Obama proposalâs to revive American manufacturing comes after more than half a century in which manufacturingâs share of employment has been falling.

According to the Congressional Budget Office report, âthe rapid growth of productivity in manufacturing has accounted for a substantial fraction of the decline in manufacturing employment and hours.â The CBO said productivity in manufacturingÂ â" more output from fewer workers â" had risen by about one-third from 2000 to 2008.

Obama to lay out blueprint for economy 'built to last' in SOTU

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