Here’s the transcript and video of President Obama’s Weekly Address. The topics are the economy, the difficulty of bipartisanship in an increasingly partisan Washington and the “pay as you go” rule Obama signed into law last night. The transcript was provided by the White House and downloaded from WhiteHouse.gov on Feb. 13, 2010 at approximately 10:15 a.m. Eastern.

All across America, people work hard to meet their responsibilities. You do your jobs, take care of your families, pay your bills. Sometimes, particularly in tough times like these, you have to make hard choices about where to spend and where to save. That’s what being responsible means. That’s a bedrock value of our country. And that ought to be a value that our government lives up to as well.

Yet, over the past decade, this hasn’t always not been the case. Ten years ago, we had a big budget surplus with projected surpluses far into the future. Ten years later, those surpluses are gone. In fact, when I first walked through the door, the government’s budget deficit stood at $1.3 trillion, with the budget gap over the next decade projected to be $8 trillion.

Partly, the recession is to blame. With millions of people out of work, and millions of families facing hardship, folks are paying less in taxes while seeking more services, like unemployment benefits. Rising health care costs are also to blame. Each year, more and more tax dollars are devoted to Medicare and Medicaid.

But what also made these large deficits possible was the end of a common sense rule called “pay as you go.” It’s pretty simple. It says to Congress, you have to pay as you go. You can’t spend a dollar unless you cut a dollar elsewhere. This is how a responsible family or business manages a budget. And this is how a responsible government manages a budget, as well.

It was this rule that helped lead to balanced budgets in the 1990s, by making clear that we could not increase entitlement spending or cut taxes simply by borrowing more money. And it was the abandonment of this rule that allowed the previous administration and previous congresses to pass massive tax cuts for the wealthy and create an expensive new drug program without paying for any of it. Now in a perfect world, Congress would not have needed a law to act responsibly, to remember that every dollar spent would come from taxpayers today – or our children tomorrow.

But this isn’t a perfect world. This is Washington. And while in theory there is bipartisan agreement on moving on balanced budgets, in practice, this responsibility for the future is often overwhelmed by the politics of the moment. It falls prey to the pressure of special interests, to the pull of local concerns, and to a reality familiar to every single American – the fact that it is a lot easier to spend a dollar than save one.

That is why this rule is necessary. And that is why I am pleased that Congress fulfilled my request to restore it. Last night, I signed the “pay as you go” rule into law. Now, Congress will have to pay for what it spends, just like everybody else.

But that’s not all we must do. Even as we make critical investments to create jobs today and lay a foundation for growth tomorrow – by cutting taxes for small businesses, investing in education, promoting clean energy, and modernizing our roads and railways – we have to continue to go through the budget line by line, looking for ways to save. We have to cut where we can, to afford what we need.

This year, I’ve proposed another $20 billion in budget cuts. And I’ve also called for a freeze in government spending for three years. It won’t affect benefits through Medicare, Medicaid, or Social Security. And it will not affect national security – including benefits for veterans. But it will affect the rest of the budget.

Finally, I’ve proposed a bipartisan Fiscal Commission to provide recommendations for long-term deficit reduction. Because in the end, solving our fiscal challenge – so many years in the making – will take both parties coming together, putting politics aside, and making some hard choices about what we need to spend, and what we don’t. It will not happen any other way. Unfortunately this proposal – which received the support of a bipartisan majority in the Senate – was recently blocked. So, I will be creating this commission by executive order.

After a decade of profligacy, the American people are tired of politicians who talk the talk but don’t walk the walk when it comes to fiscal responsibility. It’s easy to get up in front of the cameras and rant against exploding deficits. What’s hard is actually getting deficits under control. But that’s what we must do. Like families across the country, we have to take responsibility for every dollar we spend. And with the return of “pay as you go,” as well as other steps we’ve begun to take, that is exactly what we are doing.

Thanks.

President Obama held a news conference following a bipartisan meeting with House and Senate Republicans and Democrats. Here is the full transcript of the president’s remarks and complete video of the news conference. Press Secretary Robert Gibbs spoke for about 30 minutes but that is not part of the transcript. The transcript was provided by the White House and downloaded from WhiteHouse.gov on Feb. 10, 2010 at approximately 10:00 a.m. Eastern.

1:38 P.M. EST

THE PRESIDENT: Hello, everybody. I am glad to see that all of you braved the weather to be here. A little while ago I had a meeting with the Democratic and Republican congressional leaders, and it went very well. In fact, I understand that McConnell and Reid are out doing snow angels on the South Lawn together. (Laughter.) Can you picture that, Chuck? Not really?

The meeting did go well, and I appreciate them making the trek. We had a good and frank conversation and it’s one that I hope we can continue on a more regular basis.

We all understand that there are legitimate and genuine differences between the parties, but despite the political posturing that often paralyzes this town, there are many issues upon which we can and should agree. That’s what the American people are demanding of us. I think they’re tired of every day being Election Day in Washington. And at this critical time in our country, the people sent us here expect a seriousness of purpose that transcends petty politics.

That’s why I’m going to continue to seek the best ideas from either party as we work to tackle the pressing challenges ahead. I am confident, for example, that when one in 10 of our fellow citizens can’t work, we should be able to come together and help business create more jobs. We ought to be able to agree on providing small businesses with additional tax credits and much needed lines of credit. We ought to agree on investments in crumbling roads and bridges, and we should agree on tax breaks for making homes more energy-efficient — all of which will put more Americans to work. Many of the job proposals that I’ve laid out have passed the House and are soon going to be debated in the Senate. We spent a lot of time in this meeting discussing a jobs package and how we could move forward on that. And if there are additional ideas, I will consider them as well. What I won’t consider is doing nothing in the face of a lot of hardship across the country.

We also talked about restoring fiscal responsibility. There are few matters on which there is as much vigorous bipartisan agreement, at least in public, but unfortunately there’s also a lot of partisan wrangling behind closed doors. This is what we know for sure: For us to solve this extraordinary problem that is so many years in the making, it’s going to take the cooperation of both parties. It’s not going to happen in any other way.

I’m pleased that Congress supported my request to restore the pay-as-you-go rule, which was instrumental in turning deficits into surpluses during the 1990s. I’ve also called for a bipartisan fiscal commission. Unfortunately this measure, which originally had received the support of a bipartisan majority of the Senate and was cosponsored by Senators Conrad and Gregg, Democrats and Republicans, was blocked there. So I’m going to be creating this commission by executive order. And during our meeting I asked the leadership of both parties to join in this serious effort to address our long-term deficits, because when the politics is put aside, the reality of our fiscal challenge is not subject to interpretation. Math is not partisan. There ought to be a debate about how to close our deficits. What we can’t accept is business as usual, and we can’t afford grandstanding at the expense of actually getting something done.

During our meeting we also touched briefly on how we can move forward on health reform. I’ve already announced that in two weeks I’ll be holding a meeting with people from both parties, and as I told the congressional leadership, I’m looking forward to a constructive debate with plans that need to be measured against this test. Does it bring down costs for all Americans as well as for the federal government, which spends a huge amount on health care? Does it provide adequate protection against abuses by the insurance industry? Does it make coverage affordable and available to the tens of millions of working Americans who don’t have it right now? And does it help us get on a path of fiscal sustainability?

We also talked about why this is so urgent. Just this week, there was a report that Anthem Blue Cross, which is the largest insurer in the largest state, California, is planning on raising premiums for many individual policyholders by as much as 39 percent. If we don’t act, this is just a preview of coming attractions. Premiums will continue to rise for folks with insurance; millions more will lose their coverage altogether; our deficits will continue to grow larger. And we have an obligation — both parties — to tackle this issue in a serious way.

Now, bipartisanship depends on a willingness among both Democrats and Republicans to put aside matters of party for the good of the country. I won’t hesitate to embrace a good idea from my friends in the minority party, but I also won’t hesitate to condemn what I consider to be obstinacy that’s rooted not in substantive disagreements but in political expedience. We talked about this as well, particularly when it comes to the confirmation process. I respect the Senate’s role to advise and consent, but for months, qualified, non- controversial nominees for critical positions in government, often positions related to our national security, have been held up despite having overwhelming support. My nominee for one important job, the head of General Services Administration, which helps run the government, was denied a vote for nine months. When she finally got a vote on her nomination, she was confirmed 96 to nothing. That’s not advise and consent; that’s delay and obstruct.

One senator, as you all are aware, had put a hold on every single nominee that we had put forward due to a dispute over a couple of earmarks in his state. In our meeting, I asked the congressional leadership to put a stop to these holds in which nominees for critical jobs are denied a vote for months. Surely we can set aside partisanship and do what’s traditionally been done to confirm these nominations. If the Senate does not act — and I made this very clear — if the Senate does not act to confirm these nominees, I will consider making several recess appointments during the upcoming recess, because we can’t afford to allow politics to stand in the way of a well-functioning government.

My hope is that this will be the first of a series of meetings that I have with leadership of both parties in Congress. We’ve got to get past the tired debates that have plagued our politics and left behind nothing but soaring debt and mounting challenges, greater hardships among the American people, and extraordinary frustrations among the American people. Those frustrations are what led me to run for President, and as long as I’m here in Washington, I intend to try to make this government work on their behalf.

So, you know, I’m going to take a couple of questions, guys.

Major.

Q After meeting with you, John Boehner came out and told us, “The House can’t pass the health care bill it once passed; the Senate can’t pass the health care bill it once passed. Why would we have a conversation about legislation that can’t pass?” As a part of that, he said you and your White House and congressional Democrats should start over entirely from scratch on health care reform. How do you respond? Are you willing to do that?

THE PRESIDENT: Well, here’s how I responded to John in the meeting, and I’ve said this publicly before. There are some core goals that have to be met. We’ve got to control costs, both for families and businesses, but also for our government. Everybody out there who talks about deficits has to acknowledge that the single biggest driver of our deficits is health care spending. We cannot deal with our deficits and debt long term unless we get a handle on that. So that has to be part of a package.

Number two, we’ve got to deal with insurance abuses that affect millions of Americans who’ve got health insurance. And number three, we’ve got to make health insurance more available to folks in the individual market, as I just mentioned, in California, who are suddenly seeing their premiums go up 39 percent. That applies to the majority of small businesses, as well as sole proprietors. They are struggling.

So I’ve got these goals. Now, we have a package, as we work through the differences between the House and the Senate, and we’ll put it up on a Web site for all to see over a long period of time, that meets those criteria, meets those goals. But when I was in Baltimore talking to the House Republicans, they indicated, we can accomplish some of these goals at no cost. And I said, great, let me see it. And I have no interest in doing something that’s more expensive and harder to accomplish if somebody else has an easier way to do it.

So I’m going to be starting from scratch in the sense that I will be open to any ideas that help promote these goals. What I will not do, what I don’t think makes sense and I don’t think the American people want to see, would be another year of partisan wrangling around these issues; another six months or eight months or nine months worth of hearings in every single committee in the House and the Senate in which there’s a lot of posturing. Let’s get the relevant parties together; let’s put the best ideas on the table. My hope is that we can find enough overlap that we can say this is the right way to move forward, even if I don’t get every single thing that I want.

But here’s the point that I made to John Boehner and Mitch McConnell: Bipartisanship can’t be that I agree to all the things that they believe in or want, and they agree to none of the things I believe in and want, and that’s the price of bipartisanship, right? But that’s sometimes the way it gets presented. Mitch McConnell said something very nice in the meeting about how he supports our goals on nuclear energy and clean coal technology and more drilling to increase oil production. Well, of course he likes that; that’s part of the Republican agenda for energy, which I accept. And I’m willing to move off some of the preferences of my party in order to meet them halfway. But there’s got to be some give from their side as well. That’s true on health care; that’s true on energy; that’s true on financial reform. That’s what I’m hoping gets accomplished at the summit.

Q Do you agree the House and Senate bill can’t pass anymore?

THE PRESIDENT: What I agree with is that the public has soured on the process that they saw over the last year. I think that actually contaminates how they view the substance of the bills. I think it is important for all of these issues to be aired so that people have confidence if we’re moving forward on such a significant part of the economy as health care, that there is complete transparency and all of these issues have been adequately vetted and adequately debated.

And this gives an opportunity not just for Democrats to say here’s what we think we should do, but it also gives Republicans a showcase before the entire country to say here’s our plan; here’s why we think this will work. And one of the things that John Boehner and Mitch McConnell both said is they didn’t think that the status quo was acceptable, and that’s, right there, promising. That indicates that if all sides agree that we can’t just continue with business as usual then maybe we can actually get something done.

Q Mr. President, one of the reasons Anthem said — Anthem Blue Cross says that it’s raising its premiums is because so many people are dropping out of individual coverage because the economy is so bad and that leaves the people in the pool who are people who need medical care driving up costs. One of the reasons why businesses are not expanding right now, in addition to some of the credit issues you’ve talked about, at least according to business leaders, is they say there’s an uncertainty of what they need to plan for because of the energy bill, because of health care. That’s what they say. I’m not saying it’s true or not, but that’s what they say. What do you say when you hear that?

THE PRESIDENT: Well, I think that the biggest uncertainty has been we just went through the worst recession since the Great Depression and people weren’t sure whether the financial system was going to melt down and whether we were going to tip into a endless recession. So let’s be clear about the sources of uncertainty in terms of business investment over the last several years: A huge contraction, trillions of dollars of losses in people’s 401(k)s; people have a lot of debt coming out of the previous decade that they still haven’t worked out; the housing market losing a whole bunch of value.

So the good news is that where we were contracting by 6 percent the economy is now growing by 6 percent. The CEOs I talked to are saying they are now making investments, and I anticipate that they’re going to start hiring at a more rapid clip. What I’ve also heard is them saying that we would like to feel like Washington is working and able to get some things done.
There are two ways of interpreting the issue of uncertainty. One way would be to say, well, you know what, we’ll just go back to what we were doing before on, let’s say, the financial markets. We won’t have the regulations that we need; we won’t make any changes in terms of “too big to fail.” That will provide certainty — until the next financial crisis.

That’s not the kind of certainty I think that the financial markets need. The kind of certainty they need is for us to go ahead and agree on a bipartisan effort to put some rules of the road in place so that consumers are protected in the financial markets; so that we don’t have banks that are too big to fail; that we have ways of winding them down and protecting the overall system without taxpayer bailouts. That requires legislation. The sooner we can get that done, the better.

The same would be true when it comes to health care. A lot of CEOs I hear from will say, boy, we’d like you to get health care settled one way or another, but they will acknowledge that when they open up their latest invoice for their premiums and they find out that those premiums have gone up 20 percent or 25 percent, that’s the kind of uncertainty that also tamps down business investment.

So I guess my answer would be this: The sooner the business community has a sense that we’ve got our act together here in Washington and can move forward on big, serious issues in a substantive way without a lot of posturing and partisan wrangling, I think the better off the entire country is going to be. I absolutely agree on that.

What I think is important is not to buy into this notion that is perpetrated by some of the business interests that got a stake in this who are fighting financial reform, for example, to say, boy, we’d be doing fine if we just didn’t try to regulate the banks. That I think would be a mistake.

Q Just to play devil’s advocate on that — a small business, let’s say, not somebody who’s going to be affected by the regulatory reform, small business — you have proposed, you would acknowledge, a bold agenda. And a small business might wonder, I don’t know how the energy bill is going to affect me, I don’t know how the health care reform bill is going to affect me — I’d better hold off on hiring.

THE PRESIDENT: The small businesses I talk to — and I’ve been talking to a lot of them as I’ve been traveling around the country over the last several months — their biggest problem is right now they can’t get credit out of their banks so they’re uncertain about that. And they’re still uncertain about orders — do they just have enough customers to justify them doing more.

It’s looking better at this point. But that’s not the rationale for people saying, I’m not hiring. Let me put it this way. Most small businesses right now, if they’ve got enough customers to make a profit and they can get the bank loans required to boost their payroll, boost their inventory, and sell to those customers, they will do so. Okay?

Let’s see, let’s get a print guy here. David.

Q You heard McConnell talk about nuclear power, offshore drilling, free trade — that’s a lot of Republican stuff. Is your party going to go for that if you decide to support that –

THE PRESIDENT: You know, I think that on energy there should be a bipartisan agreement that we have to take a both/and approach rather than an either/or approach. What do I mean by that? I am very firm in my conviction that the country that leads the way in clean energy — solar, wind, biodiesel, geothermal — that country is going to win the race in the 21st century global economy. So we have to move in that direction.

What is also true is that given our energy needs in order to continue economic growth, produce jobs, make sure our businesses are competitive around the world, that we’re going to need some of the old, traditional energy sources as we’re developing these new ones and ramping them up. So we can’t overnight convert to an all-solar or an all-wind economy. That just can’t happen. We’re going to have needs in these traditional sources.

And so the question then is, are we going to be able to put together a package that includes safe, secure nuclear power; that includes new technologies so that we can use coal — which we have in abundance and is very cheap, but often is adding to our greenhouse gases — can we find sequestration technologies that clean that up; can we identify opportunities to increase our oil and natural gas production in a way that is environmentally sustainable? And that should be part of a package with our development of clean energy.

And my hope is that my Republican friends, but also Democrats, say to themselves, let’s be practical and let’s do both. Let’s not just do one or the other; let’s do both. Over time I think the transition is going to be more and more clean energy and over time fossil fuels become less prominent in our overall energy mix. But we’ve got to do both.

Q How confident are you there will be that kind of consensus for that double-edged approach?

THE PRESIDENT: I am just a eternal optimist — (laughter) — and so — it’s the right thing to do. And all I can do is just to keep on making the argument about what’s right for the country and assume that over time people, regardless of party, regardless of their particular political positions, are going to gravitate towards the truth. Okay?

I’m going to take two more. Let’s see –

Q How about the back? (Laughter.)

THE PRESIDENT: Well, I just want to make sure that I was getting a balance here, so — go ahead, Chuck.

Q Awwww –

THE PRESIDENT: Why is everybody moaning about Todd?

Q He’s too good. His questions are too precise. (Laughter.)

Q Iran — we got the news today that they’re doing more of these — trying to enhance this uranium even more. Obviously Secretary Gates today in Paris was quoted as saying basically the dialogue seems to be over and now the question is sanctions. Where are we on sanctions? How close is this? I know you had sort of an end-of-the-year deadline when you stood up there with Sarkozy and Brown. It’s now February. How quickly is this moving along?

THE PRESIDENT: Well, it’s moving along fairly quickly. I think that we have bent over backwards to say to the Islamic Republic of Iran that we are willing to have a constructive conversation about how they can align themselves with international norms and rules and reenter as full members of the international community.

The most obvious attempt was when we gave them an offer that said we are going to provide the conversion of some of the low-enriched uranium that they already have into the isotopes that they need for their medical research and for hospitals that would serve up to a million Iranian citizens. They rejected it — although one of the difficulties in dealing with Iran over the last several months is it’s not always clear who’s speaking on behalf of the government, and we get a lot of different, mixed signals. But what’s clear is, is that they have not said yes to an agreement that Russia, China, Germany, France, Great Britain and the United States all said was a good deal, and that the director of the IAEA said was the right thing to do and that Iran should accept.

That indicates to us that, despite their posturing that their nuclear power is only for civilian use, that they in fact continue to pursue a course that would lead to weaponization. And that is not acceptable to the international community, not just to the United States. So what we’ve said from the start was we’re moving on dual tracks. If you want to accept the kinds of agreements with the international community that lead you down a path of being a member of good standing, then we welcome you. If not –

Q Haven’t they responded, though? I mean, by deciding to do what they did, with these –

THE PRESIDENT: Well, I’m getting to that.

Q Okay.

THE PRESIDENT: And if not, then the next step is sanctions. They have made their choice so far, although the door is still open. And what we are going to be working on over the next several weeks is developing a significant regime of sanctions that will indicate to them how isolated they are from the international community as a whole.

Q What do you mean by “regime of sanctions”?

THE PRESIDENT: Well, meaning that there’s going to be a –

Q Some will be U.N. and some will be –

THE PRESIDENT: We are going to be looking at a variety of ways in which countries indicate to Iran that their approach is unacceptable. And the U.N. will be one aspect of that broader effort.

Q China will be there? You’re confident?

THE PRESIDENT: Well, the — we are confident right now that the international community is unified around Iran’s misbehavior in this area. How China operates at the Security Council as we pursue sanctions is something that we’re going to have to see. One thing I’m pleased about is to see how forward-leaning the Russians have been on this issue. I think they clearly have seen that Iran hasn’t been serious about solving what is a solvable dispute between Iran and the international community.

All right? I’m going to make this the last question. And I’ll take somebody from the back — yes.

Q Me?

THE PRESIDENT: Yes.

Q Thanks for doing this. It’s been a while. (Laughter.) On health care, the Republicans are asking whether the February 25th session will include economists and public interest groups and people supporting your side, or will it just be the members of Congress? And on Anthem Blue Cross, do you have the authority to go in and tell a private company they can’t charge that — how will you stop them?

THE PRESIDENT: Well, I don’t have the authority as I understand it — I can’t simply issue an executive order lowering everybody’s rates. If I could I would have done that already and saved myself a lot of grief on Capitol Hill. That’s why reform is so important. That’s why the status quo is unacceptable.

But there is no shortcut in dealing with this issue. I know the American people get frustrated in debating something like health care because you get a whole bunch of different claims being made by different groups and different interests. It is a big, complicated, tough issue. But what is also true is that without some action on the part of Congress, it is very unlikely that we see any improvement over the current trajectory. And the current trajectory is premiums keep on going up 10, 15, 20, 30 percent. The current trajectory is more and more people are losing health care.

I don’t know if people noted, because during the health care debate everybody was saying the President is trying to take over — a government takeover of health care. I don’t know if anybody noticed that for the first time this year you saw more people getting health care from government than you did from the private sector — not because of anything we did, but because more and more people are losing their health care from their employers. It’s becoming unaffordable. That’s what we’re trying to prevent.

We want people to be able to get health care from their employers. But we also understand that you’ve got to fix the system so that people are able to get it at affordable rates and small businesses can afford to give their employees insurance at an affordable rate. And that’s not happening right now.

To your question about the 25th, my hope is that this doesn’t end up being political theater, as I think some of you have phrased it. I want a substantive discussion. We haven’t refined exactly how the agenda is going to go that day. We want to talk with both the Democratic and Republican leaders to find out what they think would be most useful. I do want to make sure that there’s some people like the Congressional Budget Office, for example, that are considered non-partisan, who can answer questions.

In this whole health care debate I’m reminded of the story that was told about Senator Moynihan, who was I guess in an argument with one of his colleagues, and his colleague was losing the argument so he got a little flustered and said to Senator Moynihan, “Well, I’m entitled to my own opinion.” And Senator Moynihan said, “Well, you’re entitled to your own opinion, but you’re not entitled to your own facts.” I think that’s the key to a successful dialogue on the 25th or on health care.

Let’s establish some common facts. Let’s establish what the issues are, what the problems are, and let’s test out in front of the American people what ideas work and what ideas don’t. And if we can establish that factual accuracy about how different approaches would work, then I think we can make some progress. And it may be that some of the facts that come up are ones that make my party a little bit uncomfortable. So if it’s established that by working seriously on medical malpractice and tort reform that we can reduce some of those costs, I’ve said from the beginning of this debate I’d be willing to work on that. On the other hand, if I’m told that that is only a fraction of the problem and that is not the biggest driver of health care costs, then I’m also going to insist, okay, let’s look at that as one aspect of it, but what else are we willing to do?

And this is where it gets back to the point I was making earlier. Bipartisanship cannot mean simply that Democrats give up everything that they believe in, find the handful of things that Republicans have been advocating for and we do those things, and then we have bipartisanship. That’s not how it works in any other realm of life. That’s certainly not how it works in my marriage with Michelle, although I usually do give in most of the time. (Laughter.) But the — there’s got to be some give and take, and that’s what I’m hoping can be accomplished. And I’m confident that’s what the American people are looking for.

So, all right?

Q Jobs question?

THE PRESIDENT: Okay, since there wasn’t a jobs question –

Q Well, I just –

THE PRESIDENT: I’ll make this the last one, jobs question.

Q At the stakeout, the Republicans were saying, well, the jobs package we’ve seen, it’s not really ready yet, we’re a little worried about the cost. Are you satisfied that there is something that can be quickly moved through Congress on jobs?

THE PRESIDENT: Well, my understanding is — first of all, the House has moved forward a jobs package that has some good elements in it. My understanding is, is that there is bipartisan talks taking place as we speak on the Senate side about some elements of a package.

I think there are some things that a lot of people agree on. Just to give you an example, the idea of eliminating capital gains for small businesses — something we can all agree on. I talked about it at the State of the Union address. My hope would be that we would all agree on a mechanism to get community banks who are lending to small businesses more capital, because that is something that I keep on hearing is one of the biggest problems that small businesses have out there.

So I think that it’s realistic for us to get a package moving quickly that may not include all the things I think need to be done, and it may be that that first package builds some trust and confidence that Democrats and Republicans on Capitol Hill can work together and then we move on to the next aspect of the package and so forth. It may take a series of incremental steps, but the one thing I’m absolutely clear about is, is that we’ve got an economy that’s growing right now, a huge boost in productivity — that’s the good news. The bad news is, is that companies still haven’t taken that final step in actually putting people on their payroll full-time.

We’re seeing an increase in temporary workers, but they haven’t yet taken on that full-time worker. And so providing some additional impetus to them, right as the economy is moving in a positive direction, I think can end up yielding some good results.

All right? Thank you, guys. That was pretty good, thanks.

END
2:11 P.M. EST

While data and statistics don’t tell the whole story about our flailing economy and unemployment, but this chart created on Feb. 5, 2010 by the Bureau of Labor Statistics is pretty cool. Jobs are being created, even if slower than we’d like.

Here we go again. Just like in 2003, groupthink is sweeping the nation. When the war drums were beating their loudest to attack Iraq, the media and pundits were onboard with the Bush administration lies. No one challenged what everyone knew to be true – that Saddam Hussein had weapons of mass destruction and he was going to attack the US. Now seven years later, we’re back at it again, but this time it’s that deadly deficit that will surely kill you and your family before the year is through.

Economist Paul Krugman has been calling for more deficit spending since the recession began. He wrote that “running big deficits in the face of the worst economic slump since the 1930s is actually the right thing to do. If anything, deficits should be bigger than they are because the government should be doing more than it is to create jobs.”

And according to Krugman, he’s not a lone ranger supporting deficit spending.

“Many economists take a much calmer view of budget deficits than anything you’ll see on TV. Nor do investors seem unduly concerned: U.S. government bonds continue to find ready buyers, even at historically low interest rates,” Krugman said in his Feb. 4 column.

So what’s all the fuss about deficits? It’s politics of course. The GOP and their talk radio and Fox News echo chamber have created the illusion that deficit spending is bad and needs to stop now.

Krugman wrote that “the current sense of panic is that deficit fear-mongering has become a key part of Republican political strategy, doing double duty: it damages President Obama’s image even as it cripples his policy agenda.”

And like the media’s duck-walking in lockstep with Bush’s push for war with Iraq, Americans will suffer if deficit spending is stopped now. Americans need jobs and they need them now. State governments can’t run deficits, but the federal government can.

“For the fact is that thanks to deficit hysteria,” Krugman said, “Washington now has its priorities all wrong: all the talk is about how to shave a few billion dollars off government spending, while there’s hardly any willingness to tackle mass unemployment. Policy is headed in the wrong direction — and millions of Americans will pay the price.”

Read Krugman’s column Fiscal Scare Tactics.”

The following remarks of President Barack Obama as prepared for delivery were supplied by the White House. Town hall meeting in Nashua, New Hampshire on Feb. 2, 2010.

Hello, Nashua! It’s great to be back in New Hampshire today. Now, as some of you might remember, I’ve spent a little time in this state. I’ve had beers at the Peddler’s Daughter here in Nashua and manned the scoop at ice cream socials from Sunapee to Dover to Hudson. I’ve walked Main Street in Concord, and visited with folks in all ten counties. I even once flew into the airport in Milan, which has got to be one of the only airports with a functioning wood stove.

So I’ve had the privilege of getting to know folks here in New Hampshire. I’ve seen firsthand that spirit of independence and self-reliance. I know how hard you all work, and how tough and resilient you all are.

But I also know that folks here in New Hampshire have been tested by these last two years.

We’ve gone through the deepest recession since the Great Depression, and folks here have had their lives uprooted by lost jobs, foreclosed homes, shuttered businesses, and vanished savings. Many good, hard-working people who met their responsibilities are now struggling because folks on Wall Street and in Washington didn’t meet theirs.

So when I took office, we knew the first thing we had to do was break the back of this recession. That meant doing some things that weren’t easy, and that I know weren’t popular. It wasn’t popular to prevent our financial system from collapsing by throwing a lifeline to the very Wall Street banks that helped cause this crisis in the first place. But if we hadn’t taken these steps, the entire system could have gone down and taken our economy and millions of families and businesses with it.

Because of the steps we took, the markets have stabilized. No one’s worrying about another Great Depression like they were a year ago. The worst of the storm has passed. But the devastation remains. Today, one in ten Americans still can’t find work.

That is why jobs will be our number one focus in 2010. And we’re going to start where most new jobs do – with small businesses. These are the companies that begin in basements and garages when an entrepreneur takes a chance on his dream, or a worker decides it’s time she became her own boss. They’re companies like ARC Energy, which I visited earlier today. These folks are hard at work on a new manufacturing process for ultra-efficient LED lights that will make them affordable for ordinary people. The technology they’ve created is the only of its kind in the world. They’re this little business in a condo out on Amherst Street, and they have the potential to revolutionize an industry. Right here in Nashua.

Small businesses like ARC Energy have created roughly 65 percent of all new jobs over the past decade and a half. And I think we should make it easier for them to open their doors, expand their operations, and hire more workers. That’s why I’ve proposed a new tax credit for more than one million small businesses that hire new workers or raise wages – and a tax incentive for all businesses to invest in new plants and equipment. And while we’re at it, we should eliminate all capital gains taxes on small business investment, so these folks can get the capital they need to grow and create jobs.

That’s particularly critical right now, as bank lending standards have tightened, and many small businesses are struggling to get loans.

That’s why today, I’m announcing a proposal to take $30 billion of the money that was repaid by Wall Street banks, and use it to create a new Small Business Lending Fund that will provide capital for community banks on Main Street. These are the small, local banks that work most closely with our small businesses – that provide them their first loan, and watch them grow through good times and bad. The more loans these banks provide to creditworthy small businesses, the better a deal we’ll give them on capital from this Fund. Combined with my proposal back in December to continue waiving fees and increasing guarantees for SBA-backed loans, this will help small banks do even more of what our economy needs – ensure that small businesses are once again the engine of job growth in America.

This is just one example of what we’ve been doing to create jobs this past year. As some of you might remember, last February, we passed the Recovery Act, which had three parts. One third was tax relief for small businesses and 95 percent of working families. One third was emergency relief like increasing unemployment benefits and helping states keep teachers and police officers from losing their jobs. And one third was putting people to work on infrastructure, renewable energy, medical research and more.

Now, I understand why some people are wondering whether the Recovery Act has really worked. Because while these steps mean 2 million Americans are working right now who’d otherwise be unemployed, and our economy is growing again instead of shrinking – and growing at the fastest rate in 6 years – we lost 7 million jobs during this recession. So we’ve still got a pretty big hole to fill. And if you or a member of your family is one of those 7 million, I know it’s not particularly satisfying or reassuring to hear that it could have been a whole lot worse.

And because there’s no magic wand that will make economic problems that were years in the making disappear overnight, it’s easy for politicians to exploit the anger and anguish folks are feeling right now. But I have to say, I’ve noticed that some of the very same folks in Congress who opposed the Recovery Act – and claim that it hasn’t worked – have been all too happy to claim credit for Recovery Act projects in their districts and the jobs those projects have produced. In other words, they’ve found a way to have their cake and vote against it too.

So we’re making progress here, but it can’t come fast enough. And we know that if we truly want to have long-term economic growth in this country, then we need to start addressing the struggles middle-class families have been grappling with for years, long before this recession ever hit.

This past decade has been one of the toughest our middle class has faced in generations, as folks have seen their paychecks shrink and their housing prices fall, while the cost of everything from groceries to health care to college has gone up. They’re working two jobs; they’re working longer hours – but it’s not adding up. And a lot of people put their kids to bed at night wondering whether they’ll be able to give them the opportunities in life that they deserve.

I didn’t run for president to kick these challenges down the road. I didn’t run for president to play it safe and keep my poll numbers as high as possible for the next election. I ran to solve problems for the next generation. I ran to get the hard things done. And I won’t rest until businesses are hiring again, and wages are rising again, and the middle class is thriving again, and we’ve finally got an economy that works for all Americans again. I won’t rest until we do what we know will secure our continued leadership in the 21st century global economy. I’m not ready to cede the future to China or India or any other country. I’m not willing to settle for second place. Not for the United States of America.

But here’s the thing, Nashua: I can’t do this alone. Democrats can’t do this alone – nor should we. We’ve got two parties in this country. And that’s a good thing. It means we have heated debates and vigorous disagreements. And messy as that is, it means bad ideas can be discarded, good ones can be made better, and we don’t go too far to any one extreme. That’s the genius of our democracy.

So I was pleased when the House Republican Caucus graciously invited me to attend their retreat last week. For more than an hour, we had a frank conversation about the issues facing our country. We aired some grievances. We shared some ideas. There were plenty of things on which we didn’t agree. But there were also things on which we did – and many on which we should if we could just focus on solving problems instead of scoring political points.

We all agree that education is the key to a twenty-first century economy. We agree that the best anti-poverty program around is a world-class education. So why don’t we work together to transform our schools, so that every child in America can compete with their counterparts, from Beijing to Bangalore. Let’s work together to upgrade our community colleges, which are the gateway to a career for the children of so many working families. And in an era when a high school diploma is no longer a guarantee of a good job, let’s make college affordable for every qualified student. No graduate should have to pay more than ten percent of his or her income on student loans each year. We can see to it that they don’t – and we should.

Republicans and Democrats may not see eye to eye on the threat of global warming, but shouldn’t we agree that American grown energy is good for our security, and that new clean energy jobs are good for our economy? And surely, we can all agree that these jobs shouldn’t be going to China, or Germany – they should be here in America. So let’s invest in innovation. Let’s put people to work on solar panels and wind towers and cutting-edge batteries. Because the nation that leads the clean energy economy will be the nation that leads the global economy, and America must be that nation.

These are key parts of the foundation we need to build a better future for our families and our country. And so is fixing a health insurance system that too often works better for the insurance industry than it does for the American people.

No one should be satisfied with a system that allows insurance companies to deny care to folks with pre-existing conditions, or to kick people off their plans when they get too sick. No one should accept a system where small businesses are forced to pay outrageous premiums to get their workers covered, and seniors have big gaps in their Medicare prescription coverage. No one should accept another decade in which health insurance premiums double and millions lose their coverage altogether.

These are the things I hear about every day in the letters I get – from families going bankrupt; from small businesses crushed by their health care costs. So I won’t walk away from these efforts. I won’t walk away from these people. And I don’t think Congress should either. I think we should keep working to get this done – Democrats and Republicans together.

Finally, shouldn’t we all agree that we have got to do something about our deficits? These deficits won’t just burden our kids and grandkids decades from now – they could damage our markets, drive up our interest rates, and jeopardize our recovery right now

This isn’t how responsible families do their budgets. When times are tough, you tighten your belts. You don’t go buying a boat when you can barely pay your mortgage. You don’t blow a bunch of cash in Vegas when you’re trying to save for college. You prioritize. You make tough choices. And it’s time your government did the same.

That’s why I’ve proposed cutting more than 120 government programs – consolidating ones that are duplicative, reducing ones that are wasteful, and eliminating those that just don’t work. That’s why I’ve proposed to cap government spending over the next three years. Spending related to Medicare, Medicaid, Social Security and our national security will not be affected. But all other discretionary government programs will. And that’s why I’m grateful that both the House and Senate have now voted to reinstate the PAYGO rule that helped create those record surpluses back in the 1990s instead of the record deficits we had when I came into office. The concept here is very simple: you pay as you go. You want to start a new program? Go ahead. But you’ve got to cut another one to pay for it.

That’s how we’ll make sure we’re spending your money wisely. That’s how we’ll get our deficits under control. And that’s something on which Democrats and Republicans should be able to agree, if we could just get past the Washington game. Yet just last week, the Senate blocked a law I supported to create a bi-partisan Fiscal Commission that would come up with a set of recommendations for cutting our deficits in the long term – because solving this difficult challenge is something we can only do together. But this law failed when seven Republicans who had co-sponsored this idea suddenly walked away from their own proposal after I endorsed it. Now, it’s one thing to have an honest difference of opinion on something. There’s nothing wrong with that. It’s another to walk away from your responsibilities to confront the challenges facing this country because you think it’s good short-term politics. That’s what we can’t afford.

The message you all sent when you elected me, and that folks made clear this past month, is that you’re out of patience for this kind of business as usual. You made it clear that you want us to start worrying less about our jobs and more about yours. You want us to worry less about our elections and more about solving your problems. And for once, you’d like your government to reflect the sense of responsibility, decency, and generosity with which you live your lives.

It’s the spirit that led students here at Nashua North to spring into action in the wake of the tragedy in Haiti – planning fundraisers, selling ribbons, collecting money at lunch – all to help folks they’ve never known in a place they’ve never been.

It’s the spirit that drives small business owners like Kedar Gupta, the CEO of ARC Energy. Years before Kedar founded ARC, he co-founded a company called GT Solar with just $1,000 – and it now has 343 employees and hundreds of millions in revenue. All along, he made sure his employees shared in the company’s profits. When the company hit tough times, he cut his own salary first. And when talking about his philosophy of business, he explains that many CEOs take a “Me, me and me” approach, but that his approach is about “we” – about not just benefitting himself, but lifting his employees too.

We’ve come through a tough year and a tough decade, but that fundamental decency – that determination to do what’s right that has always been at the core of the American people – that should fill us all with optimism about what lies ahead. So let’s put aside the small things. Let’s come together and do what’s hard, and do what’s necessary to help the middle class succeed again; to give our kids a shot at their dreams again; and to fulfill the promise of this great country in our time. Thank you, God bless you, and God bless the United States of America.

The following is the complete transcript of President Obama’s speech announcing the fiscal year 2011 budget. This has been transcribed by the White House and downloaded on Feb. 2, 2010 at 10:45 a.m. Eastern.

Remarks by the President on the Budget
Grand Foyer

10:40 A.M. EST

THE PRESIDENT: Good morning, everybody. This morning, I sent a budget to Congress for the coming year. It’s a budget that reflects the serious challenges facing the country. We’re at war. Our economy has lost 7 million jobs over the last two years. And our government is deeply in debt after what can only be described as a decade of profligacy.

The fact is, 10 years ago, we had a budget surplus of more than $200 billion, with projected surpluses stretching out toward the horizon. Yet over the course of the past 10 years, the previous administration and previous Congresses created an expensive new drug program, passed massive tax cuts for the wealthy, and funded two wars without paying for any of it -– all of which was compounded by recession and by rising health care costs. As a result, when I first walked through the door, the deficit stood at $1.3 trillion, with projected deficits of $8 trillion over the next decade.

If we had taken office during ordinary times, we would have started bringing down these deficits immediately. But one year ago, our country was in crisis: We were losing nearly 700,000 jobs each month, the economy was in a free fall, and the financial system was near collapse. Many feared another Great Depression. So we initiated a rescue, and that rescue was not without significant cost; it added to the deficit as well.

One year later, because of the steps we’ve taken, we’re in a very different place. But we can’t simply move beyond this crisis; we have to address the irresponsibility that led to it. And that includes the failure to rein in spending, as well a reliance on borrowing –- from Wall Street to Washington to Main Street –- to fuel our growth. That’s what we have to change. We have to do what families across America are doing: Save where we can so that we can afford what we need.

Now, I think it’s very important to understand: We won’t be able to bring down this deficit overnight, given that the recovery is still taking hold and families across the country still need help. We will continue, for example, to do what it takes to create jobs. That’s reflected in my budget; it’s essential. The budget includes new tax cuts for people who invest in small businesses, tax credits for small businesses that hire new workers, investments that will create jobs repairing roads and bridges, and tax breaks for retrofitting homes to save energy.

We also continue to lay a new foundation for lasting growth, which is essential as well. Just as it would be a terrible mistake to borrow against our children’s future to pay our way today, it would be equally wrong to neglect their future by failing to invest in areas that will determine our economic success in this new century.

That’s why we build on the largest investment in clean energy in history, as well as increase investment in scientific research, so that we are fostering the industries and jobs of the future right here in America.

That’s why I’ve proposed a more than 6 percent increase in funding for the Education Department. And this funding is tied to reforms that raise student achievement, inspire students to excel in math and science, and turn around failing schools which consign too many young people to a lesser future — because in the 21st century there is no better anti-poverty program than a world-class education.

And that’s why we eliminate a wasteful subsidy to banks that lend to college students, and use that money to revitalize community colleges and make college more affordable. This will help us reach the goal I’ve set for America: By 2020 we will once again have the highest proportion of college graduates in the world.

These are the investments we must make to create jobs and opportunity now and in the future. And in a departure from the way business had been done in Washington, we actually show how we pay for these investments while putting our country on a more fiscally sustainable path.

I’ve proposed a freeze in government spending for three years. This won’t apply to the benefits folks get through Social Security, Medicaid, or Medicare. And it won’t apply to our national security –- including benefits for veterans. But it will apply to all other discretionary government programs. And we’re not simply photocopying last year’s budget; freezing spending does not mean we won’t cut what doesn’t work to pay for what does.

We have gone through every department’s spending line by line, item by item, looking for inefficiency, duplication, and programs that have outlived their usefulness. That’s how we freeze discretionary spending. Last year, we found $17 billion in cuts. This year, we’ve already found $20 billion.

Now, some of these cuts are just common sense. For example, we cut $115 million from a program that pays states to clean up mines that have already been cleaned up. We’re also cutting a Forest Service economic development program that strayed so far from any mission that it funded a music festival. And we’re saving $20 million by stopping the refurbishment of a Department of Energy science center that the Department of Energy does not want to refurbish.

Other cuts, though, are more painful, because the goals of the underlying programs are worthy. We eliminate one program that provides grants to do environmental clean up of abandoned buildings. That’s a mission I support, but there are other sources of private and public funds to achieve it. We also eliminated a $120 million program that allows folks to get their Earned Income Tax Credit in advance. I am a big supporter of the Earned Income Tax Credit. The problem is 80 percent of people who got this advance didn’t comply with one or more of the program’s requirements.

So I’m willing to reduce waste in programs I care about, and I’m asking members of Congress to do the same. I’m asking Republicans and Democrats alike to take a fresh look at programs they’ve supported in the past to see what’s working and what’s not, and trim back accordingly.

Like any business, we’re also looking for ways to get more bang for our buck, by promoting innovation and cutting red tape. For example, we consolidate 38 separate education programs into 11. And last fall, we launched the “SAVE Awards” to solicit ideas from federal employees about how make government more efficient and more effective. I’m proud to say that a number of these ideas — like allowing Social Security appointments to be made online — made it into our budget.

I also want to note even though the Department of Defense is exempt from the budget freeze, it’s not exempt from budget common sense. It’s not exempt from looking for savings. We save money by eliminating unnecessary defense programs that do nothing to keep us safe. One example is the $2.5 billion that we’re spending to build C-17 transport aircraft. Four years ago, the Defense Department decided to cease production because it had acquired the number requested — 180. Yet every year since, Congress had provided unrequested money for more C-17s that the Pentagon doesn’t want or need. It’s waste, pure and simple.

And there are other steps we’re taking to rein in deficits. I’ve proposed a fee on big banks to pay back taxpayers for the bailout. We’re reforming the way contracts are awarded, to save taxpayers billions of dollars. And while we extend middle-class tax cuts in this budget, we will not continue costly tax cuts for oil companies, investment fund managers, and those making over $250,000 a year. We just can’t afford it.

Finally, changing spending-as-usual depends on changing politics-as-usual. And that’s why I’ve proposed a bipartisan fiscal commission: a panel of Democrats and Republicans who would hammer out concrete deficit reduction proposals over the medium and long term, but would come up with those answers by a certain deadline. I should point out, by the way, that is an idea that had strong bipartisan support, was originally introduced by Senators Gregg on the Republican side and Conrad on the Democratic side; had a lot of Republican cosponsors to the idea. I hope that, despite the fact that it got voted down in the Senate, that both the Republican Leader Mitch McConnell and the Republican Leader in the House John Boehner go ahead and fully embrace what has been a bipartisan idea to get our arms around this budget.

That’s also why we’re restoring pay-as-you-go: a simple rule that says Congress can’t spend a dime without cutting a dime elsewhere. This rule helped lead to the budget surpluses of the 1990s, and it’s one of the most important steps we can take to restore fiscal discipline in Washington.

You can read more about the budget at budget.gov — very easy to remember — budget.gov. But the bottom line is this: We simply cannot continue to spend as if deficits don’t have consequences; as if waste doesn’t matter; as if the hard-earned tax dollars of the American people can be treated like Monopoly money; as if we can ignore this challenge for another generation. We can’t.

In order to meet this challenge, I welcome any idea, from Democrats and Republicans. What I will not welcome -– what I reject -– is the same old grandstanding when the cameras are on, and the same irresponsible budget policies when the cameras are off. It’s time to hold Washington to the same standards families and businesses hold themselves. It’s time to save what we can, spend what we must, and live within our means once again.

Thanks very much.

END
10:51 A.M. EST

Transcribed by the White House and downloaded on Jan. 30, 2010 at 10:41 a.m.
Original source
Remarks of President Barack Obama
As Prepared for Delivery
Weekly Address
January 30, 2010

At this time last year, amidst headlines about banks on the verge of collapse and job losses of 700,000 a month, we received another troubling piece of news about our economy. Our economy was shrinking at an alarming rate – the largest six-month decline in 50 years. Our factories and farms were producing less; our businesses were selling less; and more job losses were on the horizon.

One year later, according to numbers released this past week, this trend has reversed itself. For the past six months, our economy has been growing again. And last quarter, it grew more quickly than at any time in the past six years.

This is a sign of progress. And it’s an affirmation of the difficult decisions we made last year to pull our financial system back from the brink and get our economy moving again.

But when so many people are still struggling – when one in ten Americans still can’t find work, and millions more are working harder and longer for less – our mission isn’t just to grow the economy. It’s to grow jobs for folks who want them, and ensure wages are rising for those who have them. It’s not just about improvements we see in quarterly statistics, but ones people feel in their daily lives – a bigger paycheck; more security; the ability to give your kids a decent shot in life and still have enough to retire one day yourself.

That’s why job creation will be our number one focus in 2010. We’ll put more Americans back to work rebuilding our infrastructure all across the country. And since the true engines of job creation are America’s businesses, I’ve proposed tax credits to help them hire new workers, raise wages, and invest in new plants and equipment. I also want to eliminate all capital gains taxes on small business investment, and help small businesses get the loans they need to open their doors and expand their operations.

But as we work to create jobs, it is critical that we rein in the budget deficits we’ve been accumulating for far too long – deficits that won’t just burden our children and grandchildren, but could damage our markets, drive up our interest rates, and jeopardize our recovery right now.

There are certain core principles our families and businesses follow when they sit down to do their own budgets. They accept that they can’t get everything they want and focus on what they really need. They make tough decisions and sacrifice for their kids. They don’t spend what they don’t have, and they make do with what they’ve got.

It’s time their government did the same. That’s why I’m pleased that the Senate has just restored the pay-as-you-go law that was in place back in the 1990s. It’s no coincidence that we ended that decade with a $236 billion surplus. But then we did away with PAYGO – and we ended the next decade with a $1.3 trillion deficit. Reinstating this law will help get us back on track, ensuring that every time we spend, we find somewhere else to cut.

I’ve also proposed a spending freeze, so that as we increase investments in things we need, like job creation and middle class tax cuts – we cut spending on those we don’t, like tax cuts for oil companies and investment fund managers, and programs that are redundant, obsolete, or simply ineffective. Spending related to Medicare, Medicaid, and Social Security will not be affected – and neither will national security – but all other discretionary government programs will.

Finally, I’ve called for a bi-partisan Fiscal Commission – a panel of Democrats and Republicans who would sit down and hammer out concrete deficit-reduction proposals by a certain deadline. Because we’ve heard plenty of talk and a lot of yelling on TV about deficits, and it’s now time to come together and make the painful choices we need to eliminate those deficits.

This past week, 53 Democrats and Republicans voted for this commission in the Senate. But it failed when seven Republicans who had co-sponsored this idea in the first place suddenly decided to vote against it.

Now, it’s one thing to have an honest difference of opinion about something. I will always respect those who take a principled stand for what they believe, even if I disagree with them.

But what I won’t accept is changing positions because it’s good politics. What I won’t accept is opposition for opposition’s sake. We cannot have a serious discussion and take meaningful action to create jobs and control our deficits if politicians just do what’s necessary to win the next election instead of what’s best for the next generation.

I’m ready and eager to work with anyone who’s serious about solving the real problems facing our people and our country. I welcome anyone who comes to the table in good faith to help get our economy moving again and fulfill this country’s promise. That’s why we were elected in the first place. That’s what the American people expect and deserve. And that’s what we must deliver.

Thank you.

This is the complete text of President Obama’s State of the Union delivered on Jan. 27, 2010 and transcribed by the White House.

Madam Speaker, Vice President Biden, members of Congress, distinguished guests, and fellow Americans:

Our Constitution declares that from time to time, the President shall give to Congress information about the state of our union. For 220 years, our leaders have fulfilled this duty. They’ve done so during periods of prosperity and tranquility. And they’ve done so in the midst of war and depression; at moments of great strife and great struggle.

It’s tempting to look back on these moments and assume that our progress was inevitable — that America was always destined to succeed. But when the Union was turned back at Bull Run, and the Allies first landed at Omaha Beach, victory was very much in doubt. When the market crashed on Black Tuesday, and civil rights marchers were beaten on Bloody Sunday, the future was anything but certain. These were the times that tested the courage of our convictions, and the strength of our union. And despite all our divisions and disagreements, our hesitations and our fears, America prevailed because we chose to move forward as one nation, as one people.

Again, we are tested. And again, we must answer history’s call.

One year ago, I took office amid two wars, an economy rocked by a severe recession, a financial system on the verge of collapse, and a government deeply in debt. Experts from across the political spectrum warned that if we did not act, we might face a second depression. So we acted — immediately and aggressively. And one year later, the worst of the storm has passed.

But the devastation remains. One in 10 Americans still cannot find work. Many businesses have shuttered. Home values have declined. Small towns and rural communities have been hit especially hard. And for those who’d already known poverty, life has become that much harder.

This recession has also compounded the burdens that America’s families have been dealing with for decades — the burden of working harder and longer for less; of being unable to save enough to retire or help kids with college.

So I know the anxieties that are out there right now. They’re not new. These struggles are the reason I ran for President. These struggles are what I’ve witnessed for years in places like Elkhart, Indiana; Galesburg, Illinois. I hear about them in the letters that I read each night. The toughest to read are those written by children — asking why they have to move from their home, asking when their mom or dad will be able to go back to work.

For these Americans and so many others, change has not come fast enough. Some are frustrated; some are angry. They don’t understand why it seems like bad behavior on Wall Street is rewarded, but hard work on Main Street isn’t; or why Washington has been unable or unwilling to solve any of our problems. They’re tired of the partisanship and the shouting and the pettiness. They know we can’t afford it. Not now.

So we face big and difficult challenges. And what the American people hope — what they deserve — is for all of us, Democrats and Republicans, to work through our differences; to overcome the numbing weight of our politics. For while the people who sent us here have different backgrounds, different stories, different beliefs, the anxieties they face are the same. The aspirations they hold are shared: a job that pays the bills; a chance to get ahead; most of all, the ability to give their children a better life.

You know what else they share? They share a stubborn resilience in the face of adversity. After one of the most difficult years in our history, they remain busy building cars and teaching kids, starting businesses and going back to school. They’re coaching Little League and helping their neighbors. One woman wrote to me and said, “We are strained but hopeful, struggling but encouraged.”

It’s because of this spirit — this great decency and great strength — that I have never been more hopeful about America’s future than I am tonight. (Applause.) Despite our hardships, our union is strong. We do not give up. We do not quit. We do not allow fear or division to break our spirit. In this new decade, it’s time the American people get a government that matches their decency; that embodies their strength. (Applause.)
And tonight, tonight I’d like to talk about how together we can deliver on that promise.

It begins with our economy.

Our most urgent task upon taking office was to shore up the same banks that helped cause this crisis. It was not easy to do. And if there’s one thing that has unified Democrats and Republicans, and everybody in between, it’s that we all hated the bank bailout. I hated it — (applause.) I hated it. You hated it. It was about as popular as a root canal. (Laughter.)

But when I ran for President, I promised I wouldn’t just do what was popular — I would do what was necessary. And if we had allowed the meltdown of the financial system, unemployment might be double what it is today. More businesses would certainly have closed. More homes would have surely been lost.

So I supported the last administration’s efforts to create the financial rescue program. And when we took that program over, we made it more transparent and more accountable. And as a result, the markets are now stabilized, and we’ve recovered most of the money we spent on the banks. (Applause.) Most but not all.

To recover the rest, I’ve proposed a fee on the biggest banks. (Applause.) Now, I know Wall Street isn’t keen on this idea. But if these firms can afford to hand out big bonuses again, they can afford a modest fee to pay back the taxpayers who rescued them in their time of need. (Applause.)

Now, as we stabilized the financial system, we also took steps to get our economy growing again, save as many jobs as possible, and help Americans who had become unemployed.

That’s why we extended or increased unemployment benefits for more than 18 million Americans; made health insurance 65 percent cheaper for families who get their coverage through COBRA; and passed 25 different tax cuts.

Now, let me repeat: We cut taxes. We cut taxes for 95 percent of working families. (Applause.) We cut taxes for small businesses. We cut taxes for first-time homebuyers. We cut taxes for parents trying to care for their children. We cut taxes for 8 million Americans paying for college. (Applause.)

I thought I’d get some applause on that one. (Laughter and applause.)

As a result, millions of Americans had more to spend on gas and food and other necessities, all of which helped businesses keep more workers. And we haven’t raised income taxes by a single dime on a single person. Not a single dime. (Applause.)

Because of the steps we took, there are about two million Americans working right now who would otherwise be unemployed. (Applause.) Two hundred thousand work in construction and clean energy; 300,000 are teachers and other education workers. Tens of thousands are cops, firefighters, correctional officers, first responders. (Applause.) And we’re on track to add another one and a half million jobs to this total by the end of the year.

The plan that has made all of this possible, from the tax cuts to the jobs, is the Recovery Act. (Applause.) That’s right — the Recovery Act, also known as the stimulus bill. (Applause.) Economists on the left and the right say this bill has helped save jobs and avert disaster. But you don’t have to take their word for it. Talk to the small business in Phoenix that will triple its workforce because of the Recovery Act. Talk to the window manufacturer in Philadelphia who said he used to be skeptical about the Recovery Act, until he had to add two more work shifts just because of the business it created. Talk to the single teacher raising two kids who was told by her principal in the last week of school that because of the Recovery Act, she wouldn’t be laid off after all.

There are stories like this all across America. And after two years of recession, the economy is growing again. Retirement funds have started to gain back some of their value. Businesses are beginning to invest again, and slowly some are starting to hire again.

But I realize that for every success story, there are other stories, of men and women who wake up with the anguish of not knowing where their next paycheck will come from; who send out resumes week after week and hear nothing in response. That is why jobs must be our number-one focus in 2010, and that’s why I’m calling for a new jobs bill tonight. (Applause.)

Now, the true engine of job creation in this country will always be America’s businesses. (Applause.) But government can create the conditions necessary for businesses to expand and hire more workers.

We should start where most new jobs do — in small businesses, companies that begin when — (applause) — companies that begin when an entrepreneur — when an entrepreneur takes a chance on a dream, or a worker decides it’s time she became her own boss. Through sheer grit and determination, these companies have weathered the recession and they’re ready to grow. But when you talk to small businessowners in places like Allentown, Pennsylvania, or Elyria, Ohio, you find out that even though banks on Wall Street are lending again, they’re mostly lending to bigger companies. Financing remains difficult for small businessowners across the country, even those that are making a profit.

So tonight, I’m proposing that we take $30 billion of the money Wall Street banks have repaid and use it to help community banks give small businesses the credit they need to stay afloat. (Applause.) I’m also proposing a new small business tax credit
– one that will go to over one million small businesses who hire new workers or raise wages. (Applause.) While we’re at it, let’s also eliminate all capital gains taxes on small business investment, and provide a tax incentive for all large businesses and all small businesses to invest in new plants and equipment. (Applause.)

Next, we can put Americans to work today building the infrastructure of tomorrow. (Applause.) From the first railroads to the Interstate Highway System, our nation has always been built to compete. There’s no reason Europe or China should have the fastest trains, or the new factories that manufacture clean energy products.

Tomorrow, I’ll visit Tampa, Florida, where workers will soon break ground on a new high-speed railroad funded by the Recovery Act. (Applause.) There are projects like that all across this country that will create jobs and help move our nation’s goods, services, and information. (Applause.)

We should put more Americans to work building clean energy facilities — (applause) — and give rebates to Americans who make their homes more energy-efficient, which supports clean energy jobs. (Applause.) And to encourage these and other businesses to stay within our borders, it is time to finally slash the tax breaks for companies that ship our jobs overseas, and give those tax breaks to companies that create jobs right here in the United States of America. (Applause.)

Now, the House has passed a jobs bill that includes some of these steps. (Applause.) As the first order of business this year, I urge the Senate to do the same, and I know they will. (Applause.) They will. (Applause.) People are out of work. They’re hurting. They need our help. And I want a jobs bill on my desk without delay. (Applause.)

But the truth is, these steps won’t make up for the seven million jobs that we’ve lost over the last two years. The only way to move to full employment is to lay a new foundation for long-term economic growth, and finally address the problems that America’s families have confronted for years.

We can’t afford another so-called economic “expansion” like the one from the last decade — what some call the “lost decade” — where jobs grew more slowly than during any prior expansion; where the income of the average American household declined while the cost of health care and tuition reached record highs; where prosperity was built on a housing bubble and financial speculation.

From the day I took office, I’ve been told that addressing our larger challenges is too ambitious; such an effort would be too contentious. I’ve been told that our political system is too gridlocked, and that we should just put things on hold for a while.

For those who make these claims, I have one simple question: How long should we wait? How long should America put its future on hold? (Applause.)

You see, Washington has been telling us to wait for decades, even as the problems have grown worse. Meanwhile, China is not waiting to revamp its economy. Germany is not waiting. India is not waiting. These nations — they’re not standing still. These nations aren’t playing for second place. They’re putting more emphasis on math and science. They’re rebuilding their infrastructure. They’re making serious investments in clean energy because they want those jobs. Well, I do not accept second place for the United States of America. (Applause.)

As hard as it may be, as uncomfortable and contentious as the debates may become, it’s time to get serious about fixing the problems that are hampering our growth.

Now, one place to start is serious financial reform. Look, I am not interested in punishing banks. I’m interested in protecting our economy. A strong, healthy financial market makes it possible for businesses to access credit and create new jobs. It channels the savings of families into investments that raise incomes. But that can only happen if we guard against the same recklessness that nearly brought down our entire economy.

We need to make sure consumers and middle-class families have the information they need to make financial decisions. (Applause.) We can’t allow financial institutions, including those that take your deposits, to take risks that threaten the whole economy.

Now, the House has already passed financial reform with many of these changes. (Applause.) And the lobbyists are trying to kill it. But we cannot let them win this fight. (Applause.) And if the bill that ends up on my desk does not meet the test of real reform, I will send it back until we get it right. We’ve got to get it right. (Applause.)

Next, we need to encourage American innovation. Last year, we made the largest investment in basic research funding in history — (applause) — an investment that could lead to the world’s cheapest solar cells or treatment that kills cancer cells but leaves healthy ones untouched. And no area is more ripe for such innovation than energy. You can see the results of last year’s investments in clean energy — in the North Carolina company that will create 1,200 jobs nationwide helping to make advanced batteries; or in the California business that will put a thousand people to work making solar panels.

But to create more of these clean energy jobs, we need more production, more efficiency, more incentives. And that means building a new generation of safe, clean nuclear power plants in this country. (Applause.) It means making tough decisions about opening new offshore areas for oil and gas development. (Applause.) It means continued investment in advanced biofuels and clean coal technologies. (Applause.) And, yes, it means passing a comprehensive energy and climate bill with incentives that will finally make clean energy the profitable kind of energy in America. (Applause.)

I am grateful to the House for passing such a bill last year. (Applause.) And this year I’m eager to help advance the bipartisan effort in the Senate. (Applause.)

I know there have been questions about whether we can afford such changes in a tough economy. I know that there are those who disagree with the overwhelming scientific evidence on climate change. But here’s the thing — even if you doubt the evidence, providing incentives for energy-efficiency and clean energy are the right thing to do for our future — because the nation that leads the clean energy economy will be the nation that leads the global economy. And America must be that nation. (Applause.)

Third, we need to export more of our goods. (Applause.) Because the more products we make and sell to other countries, the more jobs we support right here in America. (Applause.) So tonight, we set a new goal: We will double our exports over the next five years, an increase that will support two million jobs in America. (Applause.) To help meet this goal, we’re launching a National Export Initiative that will help farmers and small businesses increase their exports, and reform export controls consistent with national security. (Applause.)

We have to seek new markets aggressively, just as our competitors are. If America sits on the sidelines while other nations sign trade deals, we will lose the chance to create jobs on our shores. (Applause.) But realizing those benefits also means enforcing those agreements so our trading partners play by the rules. (Applause.) And that’s why we’ll continue to shape a Doha trade agreement that opens global markets, and why we will strengthen our trade relations in Asia and with key partners like South Korea and Panama and Colombia. (Applause.)

Fourth, we need to invest in the skills and education of our people. (Applause.)

Now, this year, we’ve broken through the stalemate between left and right by launching a national competition to improve our schools. And the idea here is simple: Instead of rewarding failure, we only reward success. Instead of funding the status quo, we only invest in reform — reform that raises student achievement; inspires students to excel in math and science; and turns around failing schools that steal the future of too many young Americans, from rural communities to the inner city. In the 21st century, the best anti-poverty program around is a world-class education. (Applause.) And in this country, the success of our children cannot depend more on where they live than on their potential.

When we renew the Elementary and Secondary Education Act, we will work with Congress to expand these reforms to all 50 states. Still, in this economy, a high school diploma no longer guarantees a good job. That’s why I urge the Senate to follow the House and pass a bill that will revitalize our community colleges, which are a career pathway to the children of so many working families. (Applause.)

To make college more affordable, this bill will finally end the unwarranted taxpayer subsidies that go to banks for student loans. (Applause.) Instead, let’s take that money and give families a $10,000 tax credit for four years of college and increase Pell Grants. (Applause.) And let’s tell another one million students that when they graduate, they will be required to pay only 10 percent of their income on student loans, and all of their debt will be forgiven after 20 years — and forgiven after 10 years if they choose a career in public service, because in the United States of America, no one should go broke because they chose to go to college. (Applause.)

And by the way, it’s time for colleges and universities to get serious about cutting their own costs — (applause) — because they, too, have a responsibility to help solve this problem.

Now, the price of college tuition is just one of the burdens facing the middle class. That’s why last year I asked Vice President Biden to chair a task force on middle-class families. That’s why we’re nearly doubling the child care tax credit, and making it easier to save for retirement by giving access to every worker a retirement account and expanding the tax credit for those who start a nest egg. That’s why we’re working to lift the value of a family’s single largest investment — their home. The steps we took last year to shore up the housing market have allowed millions of Americans to take out new loans and save an average of $1,500 on mortgage payments.

This year, we will step up refinancing so that homeowners can move into more affordable mortgages. (Applause.) And it is precisely to relieve the burden on middle-class families that we still need health insurance reform. (Applause.) Yes, we do. (Applause.)

Now, let’s clear a few things up. (Laughter.) I didn’t choose to tackle this issue to get some legislative victory under my belt. And by now it should be fairly obvious that I didn’t take on health care because it was good politics. (Laughter.) I took on health care because of the stories I’ve heard from Americans with preexisting conditions whose lives depend on getting coverage; patients who’ve been denied coverage; families — even those with insurance — who are just one illness away from financial ruin.

After nearly a century of trying — Democratic administrations, Republican administrations — we are closer than ever to bringing more security to the lives of so many Americans. The approach we’ve taken would protect every American from the worst practices of the insurance industry. It would give small businesses and uninsured Americans a chance to choose an affordable health care plan in a competitive market. It would require every insurance plan to cover preventive care.

And by the way, I want to acknowledge our First Lady, Michelle Obama, who this year is creating a national movement to tackle the epidemic of childhood obesity and make kids healthier. (Applause.) Thank you. She gets embarrassed. (Laughter.)

Our approach would preserve the right of Americans who have insurance to keep their doctor and their plan. It would reduce costs and premiums for millions of families and businesses. And according to the Congressional Budget Office — the independent organization that both parties have cited as the official scorekeeper for Congress — our approach would bring down the deficit by as much as $1 trillion over the next two decades. (Applause.)

Still, this is a complex issue, and the longer it was debated, the more skeptical people became. I take my share of the blame for not explaining it more clearly to the American people. And I know that with all the lobbying and horse-trading, the process left most Americans wondering, “What’s in it for me?”

But I also know this problem is not going away. By the time I’m finished speaking tonight, more Americans will have lost their health insurance. Millions will lose it this year. Our deficit will grow. Premiums will go up. Patients will be denied the care they need. Small business owners will continue to drop coverage altogether. I will not walk away from these Americans, and neither should the people in this chamber. (Applause.)

So, as temperatures cool, I want everyone to take another look at the plan we’ve proposed. There’s a reason why many doctors, nurses, and health care experts who know our system best consider this approach a vast improvement over the status quo. But if anyone from either party has a better approach that will bring down premiums, bring down the deficit, cover the uninsured, strengthen Medicare for seniors, and stop insurance company abuses, let me know. (Applause.) Let me know. Let me know. (Applause.) I’m eager to see it.

Here’s what I ask Congress, though: Don’t walk away from reform. Not now. Not when we are so close. Let us find a way to come together and finish the job for the American people. (Applause.) Let’s get it done. Let’s get it done. (Applause.)

Now, even as health care reform would reduce our deficit, it’s not enough to dig us out of a massive fiscal hole in which we find ourselves. It’s a challenge that makes all others that much harder to solve, and one that’s been subject to a lot of political posturing. So let me start the discussion of government spending by setting the record straight.

At the beginning of the last decade, the year 2000, America had a budget surplus of over $200 billion. (Applause.) By the time I took office, we had a one-year deficit of over $1 trillion and projected deficits of $8 trillion over the next decade. Most of this was the result of not paying for two wars, two tax cuts, and an expensive prescription drug program. On top of that, the effects of the recession put a $3 trillion hole in our budget. All this was before I walked in the door. (Laughter and applause.)

Now — just stating the facts. Now, if we had taken office in ordinary times, I would have liked nothing more than to start bringing down the deficit. But we took office amid a crisis. And our efforts to prevent a second depression have added another $1 trillion to our national debt. That, too, is a fact.

I’m absolutely convinced that was the right thing to do. But families across the country are tightening their belts and making tough decisions. The federal government should do the same. (Applause.) So tonight, I’m proposing specific steps to pay for the trillion dollars that it took to rescue the economy last year.

Starting in 2011, we are prepared to freeze government spending for three years. (Applause.) Spending related to our national security, Medicare, Medicaid, and Social Security will not be affected. But all other discretionary government programs will. Like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don’t. And if I have to enforce this discipline by veto, I will. (Applause.)

We will continue to go through the budget, line by line, page by page, to eliminate programs that we can’t afford and don’t work. We’ve already identified $20 billion in savings for next year. To help working families, we’ll extend our middle-class tax cuts. But at a time of record deficits, we will not continue tax cuts for oil companies, for investment fund managers, and for those making over $250,000 a year. We just can’t afford it. (Applause.)

Now, even after paying for what we spent on my watch, we’ll still face the massive deficit we had when I took office. More importantly, the cost of Medicare, Medicaid, and Social Security will continue to skyrocket. That’s why I’ve called for a bipartisan fiscal commission, modeled on a proposal by Republican Judd Gregg and Democrat Kent Conrad. (Applause.) This can’t be one of those Washington gimmicks that lets us pretend we solved a problem. The commission will have to provide a specific set of solutions by a certain deadline.

Now, yesterday, the Senate blocked a bill that would have created this commission. So I’ll issue an executive order that will allow us to go forward, because I refuse to pass this problem on to another generation of Americans. (Applause.) And when the vote comes tomorrow, the Senate should restore the pay-as-you-go law that was a big reason for why we had record surpluses in the 1990s. (Applause.)

Now, I know that some in my own party will argue that we can’t address the deficit or freeze government spending when so many are still hurting. And I agree — which is why this freeze won’t take effect until next year — (laughter) — when the economy is stronger. That’s how budgeting works. (Laughter and applause.) But understand — understand if we don’t take meaningful steps to rein in our debt, it could damage our markets, increase the cost of borrowing, and jeopardize our recovery — all of which would have an even worse effect on our job growth and family incomes.

From some on the right, I expect we’ll hear a different argument — that if we just make fewer investments in our people, extend tax cuts including those for the wealthier Americans, eliminate more regulations, maintain the status quo on health care, our deficits will go away. The problem is that’s what we did for eight years. (Applause.) That’s what helped us into this crisis. It’s what helped lead to these deficits. We can’t do it again.

Rather than fight the same tired battles that have dominated Washington for decades, it’s time to try something new. Let’s invest in our people without leaving them a mountain of debt. Let’s meet our responsibility to the citizens who sent us here. Let’s try common sense. (Laughter.) A novel concept.

To do that, we have to recognize that we face more than a deficit of dollars right now. We face a deficit of trust — deep and corrosive doubts about how Washington works that have been growing for years. To close that credibility gap we have to take action on both ends of Pennsylvania Avenue — to end the outsized influence of lobbyists; to do our work openly; to give our people the government they deserve. (Applause.)

That’s what I came to Washington to do. That’s why — for the first time in history — my administration posts on our White House visitors online. That’s why we’ve excluded lobbyists from policymaking jobs, or seats on federal boards and commissions.

But we can’t stop there. It’s time to require lobbyists to disclose each contact they make on behalf of a client with my administration or with Congress. It’s time to put strict limits on the contributions that lobbyists give to candidates for federal office.

With all due deference to separation of powers, last week the Supreme Court reversed a century of law that I believe will open the floodgates for special interests — including foreign corporations — to spend without limit in our elections. (Applause.) I don’t think American elections should be bankrolled by America’s most powerful interests, or worse, by foreign entities. (Applause.) They should be decided by the American people. And I’d urge Democrats and Republicans to pass a bill that helps to correct some of these problems.

I’m also calling on Congress to continue down the path of earmark reform. Applause.) Democrats and Republicans. (Applause.) Democrats and Republicans. You’ve trimmed some of this spending, you’ve embraced some meaningful change. But restoring the public trust demands more. For example, some members of Congress post some earmark requests online. (Applause.) Tonight, I’m calling on Congress to publish all earmark requests on a single Web site before there’s a vote, so that the American people can see how their money is being spent. (Applause.)

Of course, none of these reforms will even happen if we don’t also reform how we work with one another. Now, I’m not naïve. I never thought that the mere fact of my election would usher in peace and harmony — (laughter) — and some post-partisan era. I knew that both parties have fed divisions that are deeply entrenched. And on some issues, there are simply philosophical differences that will always cause us to part ways. These disagreements, about the role of government in our lives, about our national priorities and our national security, they’ve been taking place for over 200 years. They’re the very essence of our democracy.

But what frustrates the American people is a Washington where every day is Election Day. We can’t wage a perpetual campaign where the only goal is to see who can get the most embarrassing headlines about the other side — a belief that if you lose, I win. Neither party should delay or obstruct every single bill just because they can. The confirmation of — (applause) — I’m speaking to both parties now. The confirmation of well-qualified public servants shouldn’t be held hostage to the pet projects or grudges of a few individual senators. (Applause.)

Washington may think that saying anything about the other side, no matter how false, no matter how malicious, is just part of the game. But it’s precisely such politics that has stopped either party from helping the American people. Worse yet, it’s sowing further division among our citizens, further distrust in our government.

So, no, I will not give up on trying to change the tone of our politics. I know it’s an election year. And after last week, it’s clear that campaign fever has come even earlier than usual. But we still need to govern.

To Democrats, I would remind you that we still have the largest majority in decades, and the people expect us to solve problems, not run for the hills. (Applause.) And if the Republican leadership is going to insist that 60 votes in the Senate are required to do any business at all in this town — a supermajority — then the responsibility to govern is now yours as well. (Applause.) Just saying no to everything may be good short-term politics, but it’s not leadership. We were sent here to serve our citizens, not our ambitions. (Applause.) So let’s show the American people that we can do it together. (Applause.)

This week, I’ll be addressing a meeting of the House Republicans. I’d like to begin monthly meetings with both Democratic and Republican leadership. I know you can’t wait. (Laughter.)

Throughout our history, no issue has united this country more than our security. Sadly, some of the unity we felt after 9/11 has dissipated. We can argue all we want about who’s to blame for this, but I’m not interested in re-litigating the past. I know that all of us love this country. All of us are committed to its defense. So let’s put aside the schoolyard taunts about who’s tough. Let’s reject the false choice between protecting our people and upholding our values. Let’s leave behind the fear and division, and do what it takes to defend our nation and forge a more hopeful future — for America and for the world. (Applause.)

That’s the work we began last year. Since the day I took office, we’ve renewed our focus on the terrorists who threaten our nation. We’ve made substantial investments in our homeland security and disrupted plots that threatened to take American lives. We are filling unacceptable gaps revealed by the failed Christmas attack, with better airline security and swifter action on our intelligence. We’ve prohibited torture and strengthened partnerships from the Pacific to South Asia to the Arabian Peninsula. And in the last year, hundreds of al Qaeda’s fighters and affiliates, including many senior leaders, have been captured or killed — far more than in 2008.

And in Afghanistan, we’re increasing our troops and training Afghan security forces so they can begin to take the lead in July of 2011, and our troops can begin to come home. (Applause.) We will reward good governance, work to reduce corruption, and support the rights of all Afghans — men and women alike. (Applause.) We’re joined by allies and partners who have increased their own commitments, and who will come together tomorrow in London to reaffirm our common purpose. There will be difficult days ahead. But I am absolutely confident we will succeed.

As we take the fight to al Qaeda, we are responsibly leaving Iraq to its people. As a candidate, I promised that I would end this war, and that is what I am doing as President. We will have all of our combat troops out of Iraq by the end of this August. (Applause.) We will support the Iraqi government — we will support the Iraqi government as they hold elections, and we will continue to partner with the Iraqi people to promote regional peace and prosperity. But make no mistake: This war is ending, and all of our troops are coming home. (Applause.)

Tonight, all of our men and women in uniform — in Iraq, in Afghanistan, and around the world — they have to know that we — that they have our respect, our gratitude, our full support. And just as they must have the resources they need in war, we all have a responsibility to support them when they come home. (Applause.) That’s why we made the largest increase in investments for veterans in decades — last year. (Applause.) That’s why we’re building a 21st century VA. And that’s why Michelle has joined with Jill Biden to forge a national commitment to support military families. (Applause.)

Now, even as we prosecute two wars, we’re also confronting perhaps the greatest danger to the American people — the threat of nuclear weapons. I’ve embraced the vision of John F. Kennedy and Ronald Reagan through a strategy that reverses the spread of these weapons and seeks a world without them. To reduce our stockpiles and launchers, while ensuring our deterrent, the United States and Russia are completing negotiations on the farthest-reaching arms control treaty in nearly two decades. (Applause.) And at April’s Nuclear Security Summit, we will bring 44 nations together here in Washington, D.C. behind a clear goal: securing all vulnerable nuclear materials around the world in four years, so that they never fall into the hands of terrorists. (Applause.)

Now, these diplomatic efforts have also strengthened our hand in dealing with those nations that insist on violating international agreements in pursuit of nuclear weapons. That’s why North Korea now faces increased isolation, and stronger sanctions — sanctions that are being vigorously enforced. That’s why the international community is more united, and the Islamic Republic of Iran is more isolated. And as Iran’s leaders continue to ignore their obligations, there should be no doubt: They, too, will face growing consequences. That is a promise. (Applause.)

That’s the leadership that we are providing — engagement that advances the common security and prosperity of all people. We’re working through the G20 to sustain a lasting global recovery. We’re working with Muslim communities around the world to promote science and education and innovation. We have gone from a bystander to a leader in the fight against climate change. We’re helping developing countries to feed themselves, and continuing the fight against HIV/AIDS. And we are launching a new initiative that will give us the capacity to respond faster and more effectively to bioterrorism or an infectious disease — a plan that will counter threats at home and strengthen public health abroad.

As we have for over 60 years, America takes these actions because our destiny is connected to those beyond our shores. But we also do it because it is right. That’s why, as we meet here tonight, over 10,000 Americans are working with many nations to help the people of Haiti recover and rebuild. (Applause.) That’s why we stand with the girl who yearns to go to school in Afghanistan; why we support the human rights of the women marching through the streets of Iran; why we advocate for the young man denied a job by corruption in Guinea. For America must always stand on the side of freedom and human dignity. (Applause.) Always. (Applause.)

Abroad, America’s greatest source of strength has always been our ideals. The same is true at home. We find unity in our incredible diversity, drawing on the promise enshrined in our Constitution: the notion that we’re all created equal; that no matter who you are or what you look like, if you abide by the law you should be protected by it; if you adhere to our common values you should be treated no different than anyone else.

We must continually renew this promise. My administration has a Civil Rights Division that is once again prosecuting civil rights violations and employment discrimination. (Applause.) We finally strengthened our laws to protect against crimes driven by hate. (Applause.) This year, I will work with Congress and our military to finally repeal the law that denies gay Americans the right to serve the country they love because of who they are. (Applause.) It’s the right thing to do. (Applause.)

We’re going to crack down on violations of equal pay laws — so that women get equal pay for an equal day’s work. (Applause.) And we should continue the work of fixing our broken immigration system — to secure our borders and enforce our laws, and ensure that everyone who plays by the rules can contribute to our economy and enrich our nation. (Applause.)

In the end, it’s our ideals, our values that built America — values that allowed us to forge a nation made up of immigrants from every corner of the globe; values that drive our citizens still. Every day, Americans meet their responsibilities to their families and their employers. Time and again, they lend a hand to their neighbors and give back to their country. They take pride in their labor, and are generous in spirit. These aren’t Republican values or Democratic values that they’re living by; business values or labor values. They’re American values.

Unfortunately, too many of our citizens have lost faith that our biggest institutions — our corporations, our media, and, yes, our government — still reflect these same values. Each of these institutions are full of honorable men and women doing important work that helps our country prosper. But each time a CEO rewards himself for failure, or a banker puts the rest of us at risk for his own selfish gain, people’s doubts grow. Each time lobbyists game the system or politicians tear each other down instead of lifting this country up, we lose faith. The more that TV pundits reduce serious debates to silly arguments, big issues into sound bites, our citizens turn away.

No wonder there’s so much cynicism out there. No wonder there’s so much disappointment.

I campaigned on the promise of change — change we can believe in, the slogan went. And right now, I know there are many Americans who aren’t sure if they still believe we can change — or that I can deliver it.

But remember this — I never suggested that change would be easy, or that I could do it alone. Democracy in a nation of 300 million people can be noisy and messy and complicated. And when you try to do big things and make big changes, it stirs passions and controversy. That’s just how it is.

Those of us in public office can respond to this reality by playing it safe and avoid telling hard truths and pointing fingers. We can do what’s necessary to keep our poll numbers high, and get through the next election instead of doing what’s best for the next generation.

But I also know this: If people had made that decision 50 years ago, or 100 years ago, or 200 years ago, we wouldn’t be here tonight. The only reason we are here is because generations of Americans were unafraid to do what was hard; to do what was needed even when success was uncertain; to do what it took to keep the dream of this nation alive for their children and their grandchildren.

Our administration has had some political setbacks this year, and some of them were deserved. But I wake up every day knowing that they are nothing compared to the setbacks that families all across this country have faced this year. And what keeps me going — what keeps me fighting — is that despite all these setbacks, that spirit of determination and optimism, that fundamental decency that has always been at the core of the American people, that lives on.

It lives on in the struggling small business owner who wrote to me of his company, “None of us,” he said, “…are willing to consider, even slightly, that we might fail.”

It lives on in the woman who said that even though she and her neighbors have felt the pain of recession, “We are strong. We are resilient. We are American.”

It lives on in the 8-year-old boy in Louisiana, who just sent me his allowance and asked if I would give it to the people of Haiti.

And it lives on in all the Americans who’ve dropped everything to go someplace they’ve never been and pull people they’ve never known from the rubble, prompting chants of “U.S.A.! U.S.A.! U.S.A!” when another life was saved.

The spirit that has sustained this nation for more than two centuries lives on in you, its people. We have finished a difficult year. We have come through a difficult decade. But a new year has come. A new decade stretches before us. We don’t quit. I don’t quit. (Applause.) Let’s seize this moment — to start anew, to carry the dream forward, and to strengthen our union once more. (Applause.)

Thank you. God bless you. And God bless the United States of America. (Applause.)

At an exclusive meeting with high-level bankers in London, former Federal Reserve Chairman Paul Volcker said that the exotic financial transactions that ruined the world economy needs to stop.

“Amid throngs of bankers arguing that new regulations should not impede on financial ‘innovation,’ Volcker pushed back, blasting Wall Street’s increasingly complex financial products as useless to economic growth,” reported the Huffington Post.

Volcker is one of a growing number of economists looking to return to the Glass-Steagall days. Glass-Steagall is a Depression-era law that separated Wall Street investment banking from Main Street commercial banking.

Volcker chairs President Obama’s Economic Recovery Advisory Board.

Source: http://www.huffingtonpost.com/2009/12/09/paul-volcker-former-fed-c_n_385274.html

WASHINGTON — President Barack Obama is setting out fresh plans to reinvigorate the U.S. economy, focusing on incentives to small businesses and hiring to bring down the country’s 10 percent unemployment rate.

http://www.huffingtonpost.com/2009/12/08/obama-jobs-speech-help-fo_n_383803.html

The economic collapse most of us are still suffering through isn’t over. Sure Wall Street bounced back in just a few short months, but for the rest of us, we’re left struggling to pay our rent and to buy food. And we’re going to continue to fight, scratch and claw our way from meager paycheck to meager paycheck for a long time to come and here’s why.

To know how we got where we are today, we have to look at history. The most glaring example of economic failure was the Great Depression. What lead to this economic collapse was simply unchecked greed. You see, the Henry Fords of the time, The Gilded Age elites, were outrageously wealthy, while the average worker had next to nothing. We didn’t have a progressive taxation system, or any meaningful regulatory agencies, and so the rich were extremely rich and everyone else was poor. There was no middle class.

This gaping hole between the super-rich and the rest of America lead to the economic collapse and the Great Depression.

And so to rebuild the nation’s economy, regulatory agencies were setup so that another big economic bust would never happen again and the rich were expected to pay a lot more money in taxes. Labor unions gained some traction. Working conditions improved. Wages went up. And the middle class in America was born. That’s why everyone romanticizes the 1950s, well everyone besides African Americans living in the Jim Crow South, but that’s another story.

Since the end of the Great Depression, most of what was created to keep a healthy middle class happy is gone. The regulatory agencies are patsies for the bankers. The taxes on the wealthy have been slashed over and over again – pushing the deficit up and squeezing the middle class. The alarming disparity between the filthy rich and poor is back once again to pre-Great Depression proportions. Labor unions are essentially non-existent. Manufacturing has been exported. Education has been outsourced. Health care costs have skyrocketed. The middle class has been decimated.

What we’re watching unfold in our own lives, communities and on cable news is the slow slide into another Great Depression. Unemployment continues to go up. Millions of families are losing their homes. Banks are failing at an alarming rate. The only thing the government seems capable of doing is throwing money at Wall Street and hoping things will work out, or maybe they just don’t care.

And the reality is that it’s not going to end any time soon.

The biggest problem is unemployment. But what’s being done to fix our jobless problem? What can be done? To claw themselves out of the Great Depression, Americans had a strong manufacturing sector to rely on. Sure the banks failed and the money all dried up, but once the cash started to flow again, the factories fired up and people went back to work. But we don’t have any more factories. Starting with President Reagan, we decided that we didn’t need to make things anymore so we watched as our manufacturing businesses moved to Mexico and then to Asia. We were going to be a service-based economy.

By the end of the 1990s we had our big dot-com bubble and everyone was happy. But then a few years later that bubble burst and we all panicked for a second or two, but then we got the great housing bubble. Developers were building condos and housing subdivisions like mad and people had jobs again. But then that bubble burst and now we’re here and there aren’t any more bubbles.

Now we have to face the music and the song goes something like this: we gutted our manufacturing, slash taxes on the rich, let health insurance companies and bankers squeeze every last dime from our wallets and all we’re left with are mortgages we can’t afford, kids we can’t send to college and nowhere to work. It doesn’t have a nice ring to it, but that’s our reality.

We’re not going to be able bring back manufacturing. It’s gone. And unless something magical happens, Congress isn’t going to restore a progressive taxation system that properly redistributes the wealth from the super-rich to the rest of us. Let’s face it, Congress is a broken legislative body. Real estate isn’t going to save us again. Another dot-com bubble is going to re-inflate. What we’re left with are low paying jobs, overwhelming health care costs and over-inflated mortgages. The fact is that without a serious deflationary period, we can’t afford to live in our own country anymore. We may never recover from this economic collapse.

My response to Bob Herbert’s column today about unemployed twenty-something college graduates is – “that sucks.” Now imagine what it’s like to be 55-years-old and out of work. That really sucks.

The financial eggheads who didn’t see the economic disaster looming over the horizon back in 2006 are now telling us that the recession is over, but they’re wrong.

The recession is over when we say it’s over, and clearly we’re still very much recessed, unless of course you work for Goldman Sachs – then you’d probably think the Gilded Age is back again. But for the rest of us, times are tough.

Read Herbert’s column.

Paul Krugman won a Nobel Prize in Economics last year and he’s apparently one of the only economists who knows what’s going on with our economy. In today’s column he takes on the Federal Reserve and the old-school mentality that interest rates should go up at the same time unemployment is increasing.

If the Fed does raise interest rates, and unemployment continues going up, the possibility of another Great Depression is real. Krugman believes we’ve avoided a depression, but the signs are there that maybe we haven’t. The economy is teetering on the edge of total failure, with Goldman Sachs firmly in charge, it certainly should give us all pause.

Read Krugman’s column “Misguided Monetary Mentalities”

Bright, eager—and unwanted. While unemployment is ravaging just about every part of the global workforce, the most enduring harm is being done to young people who can’t grab onto the first rung of the career ladder.

Read BusinessWeek story

If you listen to wind-bags like Glenn Beck and Sean Hannity you’d think that America is the greatest country ever formed and anyone who disagrees with them is a commie-terrorist-socialist-bastard. But if you look at where we’ve been, and more importantly, where we’re headed, the United States of America is no longer, if it ever was, the greatest country in the world.

First let’s set aside the rhetoric of the so-called patriots and let’s look at the reality of life in the US.

We once were a powerful industrialized nation that made things. We used to make everything from cars people actually purchased to televisions, radios, fans, suitcases, clothes and whatever else we needed. Now we make bankers, insurance policies and print money when we need more of it. Our manufacturing sector has been thoroughly gutted. We now import just about everything and export jobs to Taiwan, India, China and wherever corporations can find cheap labor. As a result, real wages in America continue to fall and consumer debt has skyrocketed. In August, Americans were shouldering $2.4 trillion in debt, with revolving debt at about $900 billion. Check the Federal Reserve stats on consumer debt

We also should look at education as Paul Krugman did in this column today.

If you had to explain America’s economic success with one word, that word would be “education.” In the 19th century, America led the way in universal basic education. Then, as other nations followed suit, the “high school revolution” of the early 20th century took us to a whole new level. And in the years after World War II, America established a commanding position in higher education.

But that was then. The rise of American education was, overwhelmingly, the rise of public education — and for the past 30 years our political scene has been dominated by the view that any and all government spending is a waste of taxpayer dollars. Education, as one of the largest components of public spending, has inevitably suffered.

Like manufacturing, education in American has been gored, gutted and tossed in the dumpster. Teachers are underpaid, students and parents don’t seem to give a rip, higher education is way too expensive and politicians tell us that all government spending on anything other than military is just wrong. While we’ve yet to truly realize the destruction of creating generations of uneducated citizens, when we do, it will be too late to do anything about it.

We’re seeing some of the impact of poor education with the so-called tea bag protesters who don’t know why they’re mad – they just are. They can’t think critically about any issue because they haven’t been taught the value of critical thought. This is just the beginning. In another 20 years we’re going to have millions of citizens who can barely read and write trying to compete with countries like India, China, France and Germany that actually do believe that education is the key to their nation’s success.

Our priorities are completely out of whack in the US. We’d rather spend more than $1 trillion fighting the wars in Iraq and Afghanistan with no clear objective in mind, than on health care, education and building industries of the future. So what can we do to change this? Unfortunately, the answer is not much. Our political system has been hijacked by defense contractors, ideologues and corporations. Everything that we do has to involve the “profit motive,” which is another way of saying, corporations need to make money off of education, war, health care and anything else the government does. And if you think we should just elect people to Congress who can change this – we can’t. At least 90 percent of all House of Representative seats are not competitive because of elaborate gerrymandering and the high cost of running a campaign.

The only way to change the direction of this country from continuing down the rabbit hole is for a complete overhaul of our political process and political parties. And the only way for that to happen is through an outright rebellion by the people. Our only hope is to organize. We need to make use of technology to communicate and coordinate a takeover of the government and put the power in the hands of people. Anything short of a true revolution will not result in any meaningful change.

The New York Times columnist Tom Friedman likes to position himself as a centrist. He’s pro-war, pro-environment, pro-business, and I guess against deficit spending. I usually agree with about 60 percent of what he writes. The problem is that he works too hard to sit precariously on the fence. In today’s column he says that deficit spending is bad and that liberals will have to sacrifice some of their social programs to balance the budget, but as usual Friedman overlooks the glaring $500 billion defense budget.

Certainly some spending on the defense of the country is necessary, but it shouldn’t be the largest line-item of the budget. If you add the Global War on Terror to defense spending, we’re looking at close to $700 million a year. And these are based on the 2008 budget that didn’t include the wars in Iraq or Afghanistan.

So why do liberals need to sacrifice health care, Social Security, welfare, education and whatever Friedman feels they should give up, while the Dept. of Defense continues to pillage the treasury?

Do we need to have all of those Cold War weapons systems and bases? I thought everything changed after 9/11. I think not.

Also, couldn’t the nation sacrifice subsidies to oil companies, drug companies, insurance companies and stop paying farmers to not grow food? Would it be completely beyond-the-pale to expect the wealthiest of the wealthy to pay their fair share?

Friedman does mention a tax increase in his column, but I’m certain he’s not talking about restoring the progressive taxation system that we once had in the US. A percentage here and a percentage point there and the rest will be placed on the backs of the poorest of the poor by gutting the social safety net.

In true Friedman fashion he misses the mark and remains perched on the fence careful to not anger the right and tossing a few grains of sand in the eye of the left while leaving the rest of us hoping that no one in power is actually paying attention to what he says.

Read Friedman’s column.
Wiki about 2008 US budget.

The Nation’s Katrina Vanden Heuvel wrote today: “These next few months are a time of reckoning.

Every so often in American political history, a window for change opens, and the combination of crisis, leadership, and political movement makes big, positive reforms possible.”

Read Katrina Vandan Heuvel story “The Fight for Financial Reform”

The recession isn’t over, and there’s more evidence that we’re crawling towards another depression. Unemployment continues to increase. Conservative estimates peg unemployment at 9.8 percent and under-employment at 17 percent. The one sector of the economy seeing growth is finance, which has benefited from the taxpayer bailout, while regular folks struggle to make ends meet.

Sooner or later a movement of the people will push back against our rigged so-called “free market” overtly pro-wealthy government agenda. The question is will it happen next year or the year after, but something will have to be done to help real people and not just line the pockets of the Elite. What will the government do to stop it? They can’t trick us into voting because we all have that. Will the government create new social programs to alleviate the financial pain the middle class is feeling? I doubt it. Perhaps a real revolution will not be stopped this time.

Forbes story about unemployment

The Hill reported today that President Obama and the other G-20 members said that the bank bailouts successfully averted another Great Depression; all that’s left is just a bit of regulatory tweaking and we’ll be right as rain. I’m sure they’re right – all government needed to do to fix the economic crisis was to throw billions and billions of dollars at the banks who screwed everything up in the first place.

We’ve become a nation run by banks, insurance companies, Big Pharma, Big Oil and the military industrial complex there to make sure they all get what they need from other countries either through the “free” market or force if necessary. Politicians follow the money, not the votes. How many Americans actually think the banks should have been bailed out?

G-20 leaders say recovery worked, agree to new reforms
Subprime Meltdown: From U.S. Liquidity Crisis To Global Recession
G-20 protesters in Pittsburgh on Sept. 24, 2009

Top inspector for the Troubled Asset Relief Program says that banks are “far more dangerous” now than before the economic collapse and subsequent bailout. So a year after last year’s run-on-the-Treasury by too-big-too-fail banks, the Troubled Asset Relief Program has done a lot to help banks get bigger and nothing to help protect the economy or taxpayers said TARP Inspector Neil Barofsky.

Watch the interview with Barofsky by the Huffington Post.