PARMA, OH -- As the final stretch of the midterm election season approaches, the Obama administration has been eager to make the case to voters that their chief concern -- the economy -- is also the White House's.
After spending months and precious political capital on passing a landmark health-care law and the most sweeping overhaul of the financial regulatory system since the 1930s, the White House has struggled to convince the American public that it has put the economy back on the right track after a punishing recession. President Obama spent 45 minutes making that argument when he traveled to this suburb of Cleveland on Wednesday for what the White House billed as a major economic speech -- the sort of event that is accompanied by background briefings, fact sheets, and conference calls.
"My hope was that the crisis would cause everybody, Democrats and Republicans, to pull together and tackle our problems in a practical way. But as we all know, things didn't work out that way," he told the audience at Cuyahoga Community College on this his tenth trip to this state since taking office. "With the nation losing nearly 800,000 jobs the month I was sworn into office, my most urgent task was to stop a financial meltdown and prevent this recession from becoming a second depression. We've done that."
With unemployment at 9.6% nationwide (and higher in Ohio), the housing market still shaky, and businesses and consumers wary of spending, the president traveled here to spell out his plan for kick-starting the flagging recovery. The economy grew just 1.6% in the second quarter -- revised down from the 2.4% pace projected earlier -- and some private economists have downgraded their growth forecasts for the year while predicting the jobless rate will hover near 10%.
In addition to the small business jobs bill that Obama wants Congress to pass as the first order of business when lawmakers return next week, the president has proposed spending $50 billion immediately to improve roads, bridges, railways and runways. Today, he called on lawmakers to expand, simplify, and make permanent research and development tax credits, as well as allow companies to deduct the full cost of capital investments through the end of 2011 -- measures he believes will encourage businesses to spend and to hire. According to the White House, accelerating tax deductions as proposed would be "the largest temporary investment incentive in American history."
The administration has resisted calling these proposals additional "stimulus," since the original $787 billion stimulus package has largely been deemed a failure -- at least in a public relations sense -- even though economists believe it helped lift the economy and boost employment. Just 30% of those polled in the latest NBC/Wall Street Journal survey said the stimulus made things better.
Even if these proposals make it into law in the few weeks that Congress will be in session before lawmakers hit the campaign trail again, their ability to significantly lower the jobless rate -- a key barometer for worried voters -- before the election is questionable. Obama aides say that in order to stem losses in November, they'll need to sharpen their message on what the Democratic Party has done to bring the economy back from the brink of collapse and where the Republican Party will take the country. The president's remarks in Ohio were reminiscent of speeches he made on the campaign trail as a presidential candidate, a period he referenced several times.
"A lot has changed since I came here in those final days of the last election, but what hasn't changed is the choice facing this country," the he said. "It's still fear versus hope; the past versus the future. It's still a choice between sliding backward and moving forward. That's what this election is about. That's the choice that you will face in November."
The president has consistently argued a GOP takeover of Congress would mean a return to the same agenda that brought the economy to the edge of the abyss, like policies that favor corporations and the rich, while gutting regulations and consumer protections. Still, the NBC/WSJ poll showed just 39% approved of his handling of the economy and that 58% of those polled thought Republicans would bring new ideas.
Here in Ohio, Obama said Congress should permanently extend the Bush-era tax cuts for middle class families, while allowing those for individuals making over $200,000 a year (and households making more than $250,000 a year) to expire, arguing the country cannot afford tax cuts for the wealthy.
"With all the other budgetary pressures we have -- with all the Republicans' talk about wanting to shrink the deficit -- they would have us borrow $700 billion over the next 10 years to give a tax cut of about $100,000 to folks who are already millionaires," said Obama as he made the case that middle class families would be more likely to spend their tax savings than the wealthy, providing a better stimulus for the economy. "Keep in mind: Wealthy Americans are just about the only folks who saw their incomes rise when Republicans were in charge."
The choice of the Cleveland area as a venue for today's remarks was no accident. House Minority Leader John Boehner of Ohio spoke here last month, laying out his party's recipe for the economy and the White House wanted to use the same turf for their rebuttal. Obama mentioned the congressman by name at least half a dozen times.
Boehner's office responded after the speech, “If the president is serious about finally focusing on jobs, a good start would be taking the advice of his recently departed budget director and freezing all tax rates, coupled with cutting federal spending to where it was before all the bailouts, government takeovers, and ‘stimulus’ spending sprees.” The statement referred to a recent op-ed by former White House OMB Director Peter Orszag, who recommended extending the Bush tax cuts -- for all Americans -- for two years before ending them completely.