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HindustanTimes Wed,24 Sep 2014

World

Economy 'highest priority' as fights loom: Obama
AP
Galesburg, July 25, 2013
First Published: 11:16 IST(25/7/2013)
Last Updated: 11:20 IST(25/7/2013)

President Barack Obama sought to build momentum for looming fiscal fights with Republicans in Congress, declaring in a speech that the economy would be the "highest priority" of his second term.

The president's remarks did not include new policy proposals or fresh solutions for addressing the partisan divide in Washington ahead of potential showdowns over raising the US borrowing limit and curtailing across-the-board federal budget cuts.

A day after he kicked off the tour in Illinois and Missouri, Obama was traveling Thursday to a seaport in Jacksonville, Florida, to yet again decry the wide gulf between his vision for a new American prosperity driven by a burgeoning middle class and the intense gridlock snarling Congress.

The first six months of Obama's second term largely have been consumed by social issues like gun control and immigration, as well as foreign policy crises including leaks about the National Security Agency's domestic spying programs.

The economy has been slowly but steadily improving. The housing market is recovering, the stock market is soaring and unemployment, while still high at 7.6%, is falling.

But the White House fears that standoffs this year over the debt ceiling and the budget cuts could hurt that progress. The president has declared that he will not negotiate over the debt ceiling and expects Republicans to lift the borrowing limit without concessions. He's also pushing to end the federal budget cuts before they extend into the next fiscal year, which begins October 1.

The president called the cuts a "meat cleaver" that has "cost jobs, hurt our military and gutted investments in American education."
Themes he outlined Wednesday included the need for the US to be better prepared to compete in a global economy.

The economy in Illinois, the setting for Obama's first speech, reflects the problems facing many Americans. A manufacturing plant in the town closed in 2004, leaving hundreds of people unemployed. Today, the factory sits vacant. Galesburg's unemployment rate is just under 8%, and nearly a quarter of its population lives in poverty.

"Those old days aren't coming back," Obama said. He said the proposals he will outline in later speeches will be aimed at adapting the US economy to an increasingly competitive and interconnected world.

Obama also spoke about growing income inequality.

"Even though our businesses are creating new jobs and have broken record profits, nearly all the income gains of the past 10 years have continued to flow to the top 1 percent," Obama said to heavy applause. "The average CEO (chief executive officer) has gotten a raise of nearly 40% since 2009, but the average American earns less than he or she did in 1999.

And companies continue to hold back on hiring those who have been out of work for some time."

Top Republicans in Washington issued withering criticism of the president's return to economic issues.

"Welcome to the conversation, Mr. President. We've never left it," said House Speaker John Boehner. He suggested that approving the Keystone XL oil pipeline from Canada to the US Gulf Coast and delaying Obama's health care overhaul would do more to create jobs than delivering speeches.


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